Financial Data and Key Metrics Changes - Gross revenue for the third quarter totaled $2.6 billion, representing a roughly 10% decline year-over-year and a 7% decline on a revenue ex-billable basis [18] - Adjusted EBITDA for the third quarter was $285 million, translating to an adjusted EBITDA margin of 10.9% [22] - Third-quarter net income was $200 million, a 7% increase year-over-year, while adjusted net income increased by about 9% to $215 million [22] Business Line Data and Key Metrics Changes - The national security portfolio declined about 1% year-over-year, but grew approximately 4% when adjusting for the impact of the government shutdown [19] - The civil business experienced a significant decline of about 28% year-over-year, with expectations for stability in the remainder of the fiscal year [19] - Net bookings for the third quarter totaled $888 million, resulting in a quarterly book-to-bill ratio of 0.3 times [20] Market Data and Key Metrics Changes - Funded backlog fell 10% year-over-year, but ended the calendar year with a record year-end backlog of over $38 billion, up about 2% from the prior year [21] - The qualified pipeline for fiscal year 2027 stands at nearly $53 billion, which is 12% higher than the fiscal year 2026 pipeline at the same point last year [21] Company Strategy and Development Direction - The company is focusing on three priorities: reducing costs, accelerating the transition to outcome-based contracting and product sales, and concentrating investments on growth vectors like cyber, national security, partnerships, and AI [6][11] - A new partnership with Andreessen Horowitz (A16Z) aims to co-create unique commercial technology for national security and public safety, with Booz Allen committing to deploy up to $400 million in A16Z's late-stage venture fund [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's operational and strategic trajectory, anticipating continued demand for national security technology and expertise [27] - The company expects quarter four funding to improve over quarter three but remain slower than usual, tightening revenue guidance to between $11.3 billion and $11.4 billion [26] Other Important Information - The company recognized a $7 million pre-tax gain from the divestiture of DARPA's Cedar work, which is excluded from non-GAAP adjusted income [23] - The board of directors approved a quarterly dividend of $0.59 per share, payable on March 2nd [25] Q&A Session Summary Question: End market expectations for FY27 - Management indicated that the national security business is expected to grow, while civil may remain flat, with signs of improvement in the civil sector [29] Question: Cost reduction plan - The cost reduction actions have been completed, with some impact expected in Q4, but the full effect will be felt in the next fiscal year [33][34] Question: Funded backlog and growth in fiscal 2027 - Management noted that awards are beginning to accelerate, with strong funding activity observed in December and January, positioning the company for growth [47] Question: Increased competition from new players - The competitive landscape has evolved, with a focus on leveraging unique relationships with tech companies to create opportunities [48] Question: Tactical selling and on-contract growth - Management acknowledged the importance of matching customer needs with solutions, noting encouraging signs in funding and pipeline growth [50]

Booz Allen Hamilton (BAH) came out with quarterly earnings of $1.77 per share, beating the Zacks Consensus Estimate of $1.26 per share. This compares to earnings of $1.55 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of +40.76%. A quarter ago, it was expected that this defense contractor would post earnings of $1.49 per share when it actually produced earnings of $1.49, delivering no surprise.Over the last four quarters, the co ...

Booz Allen reports fiscal third-quarter earnings per share of $1.77 from sales of $2.6 billion. Wall Street was looking for per-share profit of $1.27 from sales of $2.7 billion. ...

Financial Performance - Q3 FY26 - Revenue decreased by 10.2% to $2.6 billion, primarily due to a slowed procurement and funding environment, including the government shutdown[47] - Revenue excluding billable expenses decreased by 6.7% to $1.8 billion[13, 24] - Adjusted EBITDA decreased by 14.2% to $285 million, with adjusted EBITDA margins at 10.9%, a decrease of 50 bps[13, 24] - Adjusted Diluted EPS increased by 14.2% to $1.77, driven by profitability and tax benefits[13, 14] - Free Cash Flow increased by 85.1% to $248 million due to higher collections, lower payables, and lower tax payments[13, 47] Backlog and Book-to-Bill - Backlog increased by 2% year-over-year to $38 billion[14] - Quarterly book-to-bill was 0.3x, and LTM book-to-bill was 1.1x[14] Capital Deployment - $125 million was deployed in share repurchases during the third quarter, representing 1.1% of outstanding shares[16] - The board approved a quarterly dividend of $0.59 per share, a 7% increase[16] - A $400 million capital commitment was made for a partnership with Andreessen Horowitz (a16z)[16] FY26 Financial Outlook - Revenue is projected to be $11.3 - $11.4 billion, representing a decrease of 5.0 - 6.0%[18] - Adjusted EBITDA is expected to be $1,195 - $1,215 million, with adjusted EBITDA margin on revenue in the mid 10% range[18] - Adjusted Diluted EPS is projected to be $5.95 - $6.15[18] - Free Cash Flow is expected to be $825 - $900 million[18]

Core Viewpoint - Booz Allen Hamilton has raised its profit outlook for the fiscal year due to effective cost-saving measures initiated in response to funding cuts for consultants by the Trump administration [1] Group 1 - The company’s cost-saving efforts are beginning to yield positive results, contributing to an improved financial outlook [1] - The adjustments made by the company are a direct response to changes in government-contract funding, indicating a proactive approach to market conditions [1]

Financial Performance - Revenue for the three months ended December 31, 2025, was $2,620 million, a decrease of 10.2% compared to $2,917 million for the same period in 2024[12] - Operating income for the nine months ended December 31, 2025, was $770 million, down 29.7% from $1,095 million in 2024[12] - Net income for the three months ended December 31, 2025, was $200 million, an increase of 6.9% from $187 million in 2024[15] - Earnings per share (EPS) for the three months ended December 31, 2025, was $1.64, compared to $1.46 for the same period in 2024, reflecting a 12.3% increase[12] - Revenue decreased by 10% to $2,620 million for the three months ended December 31, 2025, and by 6% to $8,434 million for the nine months ended December 31, 2025, compared to the prior year period[81] - Operating income fell by 21% to $230 million for the three months ended December 31, 2025, and by 30% to $770 million for the nine months ended December 31, 2025, reflecting a decrease in operating margin from 10% to 9%[88] - Net income increased by 7% to $200 million for the three months ended December 31, 2025, but decreased by 13% to $646 million for the nine months ended December 31, 2025, compared to the prior year[91] Assets and Liabilities - Total assets as of December 31, 2025, were $7,051 million, a decrease from $7,312 million as of March 31, 2025[10] - Total liabilities as of December 31, 2025, were $6,026 million, down from $6,309 million as of March 31, 2025[10] - Total stockholders' equity as of December 31, 2025, was $1,025 million[18] - The company had total debt of $3,940 million as of December 31, 2025, with a long-term debt net of current portion amounting to $3,857 million[37] - Long-term debt, net of current portion, was $3,857 million as of December 31, 2025, slightly down from $3,915 million as of March 31, 2025[110] Cash Flow and Investments - Cash and cash equivalents at the end of the period were $882 million, slightly down from $885 million at the beginning of the period[17] - Net cash provided by operating activities for the nine months ended December 31, 2025, was $801 million, compared to $790 million in 2024, indicating a 1.4% increase[17] - Net cash provided by operations was $801 million for the nine months ended December 31, 2025, compared to $790 million in the prior year period, primarily driven by lower tax payments[101] - Net cash used in investing activities was $52 million for the nine months ended December 31, 2025, a decrease from $184 million in the prior year, mainly due to the previous year's acquisition of PGSC[102] - Net cash used in financing activities was $752 million for the nine months ended December 31, 2025, compared to $706 million in the prior year, attributed to an increase in share repurchases of $24 million and term loan payments of $22 million[103] Shareholder Actions - The company repurchased common stock worth $521 million during the nine months ended December 31, 2025[17] - The company repurchased 1.3 million shares of Class A Common Stock for $125 million during the three months ended December 31, 2025[18] - For the nine months ended December 31, 2025, the company repurchased 4.7 million shares for $486 million[18] - The company declared a quarterly cash dividend of $0.59 per share on January 23, 2026, payable on March 2, 2026, with total dividends of $67 million and $205 million for the three and nine months ended December 31, 2025, respectively[104] - The company repurchased 4.7 million shares for an aggregate of $486 million during the first nine months of fiscal 2026, with approximately $759 million remaining under the repurchase program[105] Operational Metrics - Revenue from cost-reimbursable contracts accounted for 58% of total revenue in Q3 2025, while time-and-materials and fixed-price contracts contributed 22% and 20%, respectively[29] - Defense customers generated $1,454 million in revenue, representing 55% of total revenue for the three months ended December 31, 2025, compared to 50% in the same period of 2024[29] - Total backlog as of December 31, 2025, was $38.456 billion, an increase of 2% from $37.879 billion as of December 31, 2024[76] - Funded backlog decreased from $4.658 billion in December 2024 to $4.206 billion in December 2025[76] - Unfunded backlog increased from $8.478 billion in December 2024 to $10.059 billion in December 2025[76] - Additions to funded backlog totaled $11.0 billion for the twelve months ended December 31, 2025, compared to $11.8 billion for the same period in 2024[77] Tax and Compliance - The effective income tax rates for the three months ended December 31, 2025, and 2024, were (7.0)% and 24.7%, respectively, with a tax benefit of $57 million recognized during the same period[41] - As of December 31, 2025, the company recorded $78 million in reserves for uncertain tax positions, primarily related to research and development tax credits, with a reduction of $86 million due to IRS examination adjustments[42] - The company recorded long-term income tax receivables of $176 million as of December 31, 2025, related to amended U.S. federal return refund claims[43] - The company is subject to various risks including changes in U.S. government spending and potential impacts from government shutdowns, which may affect future performance[113] Strategic Initiatives - The company is implementing actions to reduce costs by approximately $150 million annually due to a slowed procurement environment[66] - The company plans to relocate its headquarters to new office space in Reston, Virginia, with estimated total undiscounted base lease payments of $222 million[56] - The company plans to opportunistically access financing markets to secure additional debt capital resources for strategic acquisitions and investments[100] Reporting and Compliance - The company reported its quarterly financial results for the three and nine months ended December 31, 2025, with a focus on condensed consolidated balance sheets and statements of operations[101] - The financial statements include comprehensive income and cash flow statements for the same periods, highlighting key performance metrics[101] - The report is formatted in Inline XBRL, enhancing the accessibility and usability of the financial data for stakeholders[101] - Certifications from the Chief Executive Officer and Chief Financial Officer were filed, ensuring compliance with regulatory requirements[31.1][31.2][32.1][32.2] - The company is committed to transparency and accuracy in its financial reporting, as evidenced by the detailed disclosures in the quarterly report[101] - The report includes notes to the condensed consolidated financial statements, providing additional context and insights into the company's financial position[101] - The company continues to adhere to the Securities Exchange Act of 1934, maintaining its obligations as a registrant[130] - The financial results will inform future strategic decisions and operational adjustments as the company navigates market conditions[101] - The report emphasizes the importance of accurate financial reporting in supporting investor confidence and market stability[101] - The company is focused on leveraging its financial data to drive growth and enhance shareholder value moving forward[101]

Revenue Performance - Revenue for Q3 fiscal 2026 was $2.6 billion, a 10.2% decrease year-over-year, adjusting to a 6% decrease excluding the impact of the government shutdown[6] - Total revenue for the nine months ended December 31, 2025, was $8.4 billion, a 6.3% decrease year-over-year[7] - Revenue for the three months ended December 31, 2025, was $2,620 million, a decrease of 10.2% compared to $2,917 million for the same period in 2024[29] - Revenue from the Defense sector for the three months ended December 31, 2025, was $1,454 million, slightly up from $1,453 million in 2024[43] Profitability Metrics - Adjusted EBITDA for Q3 was $285 million, representing a 14.2% decrease, with an adjusted EBITDA margin of 10.9%, down 50 basis points from the previous year[6] - Adjusted diluted EPS for Q3 was $1.77, a 14.2% increase compared to the previous year[6] - Net income for Q3 increased by 7.0% to $200 million, while adjusted net income rose by 8.6% to $215 million[6] - Operating income for the nine months ended December 31, 2025, was $770 million, down 29.7% from $1,095 million in 2024[29] - Net income for the nine months ended December 31, 2025, was $646 million, a decrease of 13% compared to $742 million for the same period in 2024[31] - Basic earnings per share for the three months ended December 31, 2025, was $1.64, an increase of 12.3% from $1.46 in 2024[29] Cash Flow and Capital Management - Free cash flow for Q3 was $248 million, compared to $134 million in the prior year, marking an 85.1% increase[7] - Free cash flow for the nine months ended December 31, 2025, was $739 million, compared to $717 million for the same period in 2024[32] - Capital deployment for the quarter amounted to $195 million[6] - The company repurchased 1.1% of outstanding shares during the third quarter[6] - The company repurchased common stock worth $521 million during the nine months ended December 31, 2025[31] Guidance and Future Outlook - The updated fiscal year 2026 revenue guidance is projected to be between $11.3 billion and $11.4 billion, with revenue growth expected to be between -5.0% and -6.0%[8] - The company anticipates future improvements in operating margins and revenue growth, although specific forecasts were not provided[28] Backlog and Demand Indicators - The company reported a record backlog of $38 billion and a quarterly book-to-bill ratio of 0.3x, indicating strengthening demand across Civil and National Security portfolios[6] - Total backlog as of December 31, 2025, was $38,456 million, an increase from $37,879 million in 2024, with funded backlog at $4,206 million[41] - The company reported a book-to-bill ratio of 0.3x for the three months ended December 31, 2025, down from 0.6x in the same period of 2024[42] Balance Sheet Highlights - Total assets as of December 31, 2025, were $7,051 million, down from $7,312 million as of March 31, 2025[30] - Total liabilities as of December 31, 2025, were $6,026 million, a decrease from $6,309 million as of March 31, 2025[30] - Cash and cash equivalents at the end of the period were $882 million, compared to $885 million at the beginning of the period[31] - Net cash provided by operating activities for the nine months ended December 31, 2025, was $801 million, an increase from $790 million in 2024[31] - The company reported total debt of $3,940 million as of December 31, 2025, with a net leverage ratio of 2.5[37] Contract Types and Revenue Composition - Cost-reimbursable contracts accounted for 58% of total revenue for the three months ended December 31, 2025, up from 57% in the same period of 2024[44] - Time-and-materials contracts represented 22% of total revenue for the three months ended December 31, 2025, consistent with the previous year[44] - Fixed-price contracts made up 20% of total revenue for the three months ended December 31, 2025, unchanged from the same period in 2024[44] - For the nine months ended December 31, 2025, cost-reimbursable contracts increased to 59% of total revenue, compared to 57% in the same period of 2024[44] - Time-and-materials contracts remained at 22% of total revenue for the nine months ended December 31, 2025, similar to the previous year[44] - Fixed-price contracts decreased to 19% of total revenue for the nine months ended December 31, 2025, down from 20% in 2024[44] Workforce Changes - Total headcount decreased to 31,600 as of December 31, 2025, from 35,900 in 2024, with customer staff headcount at 29,000[43]

Core Insights - Booz Allen Hamilton Holding Corporation announced preliminary results for the third quarter of fiscal year 2026, emphasizing its commitment to technology that supports critical U.S. missions [1] - The company is focused on investing and accelerating its growth strategy to position itself for future opportunities [1] Financial Performance - The company reported revenue of $12.0 billion for the 12 months ending March 31, 2025 [5] - As of December 31, 2025, Booz Allen employed approximately 31,600 people globally [5] Upcoming Events - A live conference call to discuss the financial results for the third quarter of fiscal year 2026 is scheduled for 8 a.m. EST on January 23, 2026 [2] - The conference call will be available for public webcast and a replay will be accessible starting at 11 a.m. EST on the same day, continuing for 12 months [3] Company Overview - Booz Allen is an advanced technology company that focuses on delivering outcomes for critical defense, civil, and national security priorities [4] - The company utilizes AI, cyber, and other cutting-edge technologies to enhance national security and empower its clients [4]

Core Viewpoint - Booz Allen Hamilton is expected to report a decline in earnings and revenue for the upcoming third quarter, reflecting potential challenges in the current market environment [1]. Financial Performance - Analysts predict Booz Allen Hamilton will report earnings of $1.27 per share for the fourth quarter, down from $1.55 per share in the same period last year [1]. - The consensus estimate for quarterly revenue is $2.73 billion, a decrease from $2.92 billion reported in the previous year [1]. Recent Developments - On January 12, Booz Allen announced a partnership with Andreessen Horowitz aimed at accelerating and scaling advanced technology for government applications [2]. - Following the announcement, shares of Booz Allen Hamilton increased by 0.2%, closing at $95.76 [2]. Analyst Ratings - Citigroup analyst John Godyn maintained a Neutral rating and raised the price target from $93 to $109 [3]. - Jefferies analyst Howard Rubel maintained a Hold rating and reduced the price target from $100 to $95 [3]. - UBS analyst Gavin Parsons maintained a Neutral rating and lowered the price target from $115 to $93 [3]. - Goldman Sachs analyst Noah Poponak maintained a Sell rating and cut the price target from $93 to $80 [3]. - JP Morgan analyst Seth Seifman maintained an Underweight rating and decreased the price target from $122 to $90 [3].

Booz Allen Hamilton Holding Corporation (NYSE:BAH) will release earnings for its third quarter before the opening bell on Friday, Jan. 23.Analysts expect the McLean, Virginia-based company to report fourth-quarter earnings of $1.27 per share. That’s down from $1.55 per share in the year-ago period. The consensus estimate for Booz Allen Hamilton’s quarterly revenue is $2.73 billion (it reported $2.92 billion last year), according to Benzinga Pro.On Jan. 12, Booz Allen disclosed a partnership with Andreessen ...