Financial Data and Key Metrics Changes - The company reported bookings of $325 million for the quarter, with a book-to-bill ratio of 1.65, resulting in a backlog of $1.3 billion, which is up over $160 million or 14% year-over-year [13][27] - Revenues for the quarter were $197 million, down $32 million or 14% compared to the prior year, primarily due to a shift in focus towards challenge programs and a higher mix of development programs [13][14] - Gross margin for the second quarter decreased to 16% from 35.3% in the prior year, largely due to cost growth impacts and higher manufacturing adjustments [14][15] - GAAP net loss was $45.6 million, compared to a loss of $10.9 million in the prior year, driven by approximately $48 million of costs incurred in the quarter [15][17] - Free cash flow for the quarter was $37.5 million, an increase from $22.2 million in the prior year, attributed to strong collections and favorable billing terms [16][29] Business Line Data and Key Metrics Changes - The company made progress in retiring risks associated with challenge programs, completing or exiting four additional programs, totaling eight out of approximately 20 challenge programs [5][30] - The challenge program cost growth was primarily driven by one specific program, which included development, low-rate production, and a long production run [54][61] - The company is transitioning from a high mix of development programs to production programs, which is expected to improve margins and predictability in the future [30][38] Market Data and Key Metrics Changes - The company anticipates strong demand and bookings momentum to continue through the year, with full-year bookings expected to exceed $1 billion [32][37] - The company has a record backlog, indicating robust customer health and demand for its products [57][59] Company Strategy and Development Direction - The company is focused on four priority areas: enhancing execution for predictable performance, driving organic growth, addressing cost structure to expand margins, and improving free cash flow [38] - A reorganization was announced to streamline operations and eliminate redundancy, consolidating multiple business units under a single operating structure [24][28] - The company aims to complete the majority of challenge programs by the end of the fiscal year, which is critical for transitioning to higher-margin production programs [30][37] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that fiscal '24 is a transitional year, with expectations for revenue and earnings to be below prior year levels due to higher-than-expected cost growth [30][37] - The company is withdrawing its full-year GAAP and non-GAAP net earnings guidance, focusing instead on revenue guidance due to ongoing volatility [49][50] - Management remains optimistic about the long-term growth potential, targeting low to mid-20% adjusted EBITDA margins as the business stabilizes [61][62] Other Important Information - The company reported a significant improvement in net working capital, decreasing by approximately $70 million in the quarter [29][36] - Cash and cash equivalents at the end of the quarter were $169 million, with net debt of $448 million, reflecting free cash flow generation [29][48] Q&A Session Summary Question: What is the status of the challenge program that caused the $14 million cost growth? - Management indicated that the program will remain active for a while, but they have gained a clearer understanding of the production costs and execution requirements moving forward [54][61] Question: Are any of the businesses impaired due to the cost growth? - Management stated that impairment assessments are conducted at a gross level, and they do not see significant impairment risks at this time [56] Question: What does the decrease in sales to key customers indicate? - Management noted that fluctuations in sales percentages to key customers are normal and reflect a diversified backlog, emphasizing the strength of their current backlog and bookings [57][58]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ________________________________________________________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 29, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to COMMISSION FILE NUMBER: 001-41194 ________________________________________________________________ ...

Financial Performance Q1 FY24 - Bookings decreased by 28% from $266.9 million in Q1 FY23 to $191.5 million in Q1 FY24[4] - Revenue declined by 20% from $227.6 million in Q1 FY23 to $181.0 million in Q1 FY24[4] - Organic revenue also declined by 20% from $227.6 million in Q1 FY23 to $181.0 million in Q1 FY24[4] - Gross margin decreased by 640 basis points from 34.3% in Q1 FY23 to 27.9% in Q1 FY24[4] - Adjusted EBITDA decreased by 94% from $31.2 million (13.7% of revenue) in Q1 FY23 to $2.0 million (1.1% of revenue) in Q1 FY24[4] - Free cash flow was negative $47.1 million in Q1 FY24, compared to negative $73.4 million in Q1 FY23[4] - GAAP net loss increased from $14.3 million in Q1 FY23 to $36.7 million in Q1 FY24[4] Working Capital and Cash Flow - The company is focused on transitioning to a more cash-efficient approach to reduce working capital[3] - Efforts are underway to improve the long-term working capital posture[2] FY24 Outlook - Revenue is projected to be between $950.0 million and $1,000.0 million, representing a decrease of 2% to an increase of 3% compared to FY23 revenue of $973.9 million[34] - Adjusted EPS is expected to be between $1.19 and $1.54, compared to $1.00 in FY23[34] - Adjusted EBITDA is projected to be between $160.0 million and $185.0 million, representing 16.8% to 18.5% of revenue, compared to $132.3 million (13.6% of revenue) in FY23[34]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 For the quarterly period ended September 29, 2023 FORM 10-Q ________________________________________________________________ OR ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to COMMISSION FILE NUMBER: 0-23599 ________________________________________________________________ ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO . COMMISSION FILE NUMBER 0-23599 MERCURY SYSTEMS, INC. (Exact name of registrant as specified in its charter) Massachusetts 04-2741391 (State or other jurisdiction of incorpor ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ________________________________________________________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to COMMISSION FILE NUMBER: 0-23599 ________________________________________________________________ MERC ...

2 © Mercury Systems, Inc. Does not contain Technical Data. / /Mercury Proprietary/ No Tech Data/ / | --- | --- | |-----------------------------------------------------------------------------------------------------|-------| | | | | Focus on operational excellence, execution continues | | | Leadership driving continuous improvement in key operations, execution areas | | | Progress on late-stage development programs, new product introductions to continue in Q4, FY24 | | | Efforts continue to further enhance ...

Financial Data and Key Metrics Changes - Q3 total revenue increased by 4% year-over-year, reaching approximately $263 million compared to $253 million in Q3 2022 [41][11] - GAAP net income for Q3 was $5.2 million or $0.09 per share, an increase from $4.1 million or $0.07 per share in the same quarter last year, primarily due to a tax benefit of over $10 million [60] - Adjusted EBITDA for Q3 was $43.5 million, down from $52.5 million year-over-year, reflecting lower gross margins [61][11] - Gross margins decreased to 34.3% from 39.4% in Q3 last year, attributed to a higher concentration of development program revenues and pandemic-related execution delays [42][43] Business Line Data and Key Metrics Changes - The proportion of development program revenues increased from approximately 20% in fiscal 2021 to about 40% in fiscal 2023, impacting gross margins negatively [49][58] - Bookings for Q3 totaled $245 million, yielding a book-to-bill ratio of 0.93, which is lower than the first half of the fiscal year [46][13] - Q3 backlog grew by 10% year-over-year, indicating strong future revenue visibility [40][13] Market Data and Key Metrics Changes - The defense spending outlook remains positive, with expectations for growth in both domestic and international defense spending [35][36] - Supply chain conditions are beginning to improve, with a 30% reduction in supplier decommits observed in Q3 [64][31] - Semiconductor lead times have decreased from a peak of 52 to 99 weeks to a range of 13 to 78 weeks, although constraints still exist in certain areas [31][32] Company Strategy and Development Direction - The company is focused on transitioning from development to production contracts, which is expected to improve gross margins and cash flow in fiscal 2024 [75][76] - A strategic review of alternatives is ongoing, with no new developments disclosed during the call [9] - The company aims to leverage its strong backlog and increased defense spending to drive high single-digit to low double-digit revenue growth in the coming years [80][75] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about overcoming current execution challenges and returning to pre-pandemic margin levels as supply chain conditions normalize [26][76] - The company anticipates a significant reduction in unbilled receivables and improved cash flow as development programs are completed [105][66] - Management highlighted that the challenges faced are not related to end-market demand, which remains strong [26][31] Other Important Information - The company expects fiscal 2023 revenue to be in the range of $990 million to $1.01 billion, reflecting flat to 2% growth year-over-year [70] - Free cash flow is expected to be negative for fiscal 2023, influenced by cash outflows related to R&D tax legislation [72][62] - The company has made progress in improving manufacturing yields and expects to see continued improvements in Q4 and fiscal 2024 [28][31] Q&A Session Summary Question: Concerns about the change in adjusted EBITDA guidance - Management explained that delays in development programs and follow-on award delays for high-margin business contributed to the change in guidance [87][88] Question: Future bidding approach for development programs - Management indicated a shift towards cost-plus fixed fee structures for new development programs where feasible, to mitigate risks associated with cost growth [90][89] Question: Specific programs driving current challenges - Management refrained from disclosing specific programs but confirmed that the capabilities being developed are critical and unique [94][92] Question: Working capital release expectations - Management projected a reduction of about $30 million from unbilled receivables as development programs are completed, with an additional $60 million expected from other programs [104][99] Question: Confidence in resolving yield issues - Management expressed confidence in resolving yield issues and ramping up production, with significant improvements already noted [108][107]

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to COMMISSION FILE NUMBER: 0-23599 ________________________________________________________________ MERCURY SYSTEMS, INC. UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ________________________________________________________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended ...

Mercury Systems, Inc. (NASDAQ:MRCY) Q4 2022 Earnings Conference Call January 31, 2023 5:00 PM ET Company Participants Mark Aslett - President & Chief Executive Officer Michael Ruppert - Executive Vice President, Chief Financial Officer & Treasurer Conference Call Participants Peter Arment - Baird Seth Seifman - JPMorgan Ken Herbert - RBC Jonathan Ho - William Blair Sheila Kahyaoglu - Jefferies Michael Ciarmoli - Truist Securities Austin Moeller - Canaccord Noah Poponak - Goldman Sachs Operator Good day, eve ...