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 ...

Financial Data and Key Metrics Changes - Mercury's Q2 revenue grew 4% year-over-year, aligning with guidance, while organic revenue turned positive with a 1% increase compared to a 13% decline in Q2 of fiscal '22 [5][13] - GAAP net loss for Q2 was $10.9 million, with adjusted EBITDA at $35.7 million, down 6% from the previous year due to lower gross margins [55][26] - Free cash flow for Q2 was approximately $22 million, despite delays in customer payments [27][26] Business Line Data and Key Metrics Changes - Bookings for Q2 increased 14% year-over-year, with significant contributions from F-35 and F-18 programs, marking the largest booking in the company's history at nearly $60 million for the F-35 order [6][32] - Backlog grew 17% year-over-year to a record $1.12 billion, providing solid visibility for future growth [13][32] Market Data and Key Metrics Changes - The defense appropriations bill was approved, leading to substantial spending increases in response to national security threats, although risks to FY '24 discretionary spending remain [45][46] - The semiconductor supply chain continues to face challenges, with lead times ranging from 36 to 72 weeks, although some improvements were noted [47][68] Company Strategy and Development Direction - The company is focused on executing its strategic plan for growth and value creation, including exploring strategic alternatives such as a potential sale [10][40] - The five-year plan includes margin expansion through better execution and improved program mix, aiming for stronger profitability and working capital efficiency [33][46] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about returning to organic growth for the year, despite short-term program delays and inefficiencies [12][44] - The outlook for defense spending remains positive, with expectations for increased domestic and international defense budgets [46][87] Other Important Information - The company is undergoing leadership transitions, with the appointment of an interim CFO and a search for a permanent successor [11][22] - The impact of R&D tax legislation is expected to affect cash flow in the second half of the fiscal year [30][27] Q&A Session Summary Question: What is the status of the impact program savings? - Management indicated that the impact program is on track, with savings expected to offset some headwinds faced [35] Question: How does the free cash flow guidance split between Q3 and Q4? - Free cash flow is expected to be breakeven to slightly positive in Q3, with a stronger performance anticipated in Q4 due to higher net income and working capital release [73][76] Question: What are the expectations for bookings in the second half of the year? - Management expects strong bookings in H2, with a positive book-to-bill ratio, driven by a robust demand environment [111][106] Question: How is the company addressing semiconductor supply chain issues? - Management noted incremental improvements in lead times but emphasized that significant challenges remain, with expectations for better conditions in the second half of fiscal '24 [68][119] Question: What pricing actions have been taken to mitigate inflation? - The company implemented across-the-board price increases on commercial products and is focused on strategic pricing to offset inflationary pressures [81][103]

| --- | --- | --- | --- | |--------------------------------------------------------------------------------------------------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | SECOND QUARTER FISCAL YEAR 2023 FINANCIAL RESULTS | | | | | Mark Aslett | | | | | President and CEO | | | | | Michael Ruppert Executive Vice President and CFO | | | | | January 31, 2023, 5:00 pm ET | | | | | Webcast login at www.mrcy.com/investor Webcast replay available by 7:00 p.m. ET January 31, 2023 | | | | | © Me ...

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 September 30, 2022 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 ________________________________________________________________ ...

| --- | --- | --- | --- | --- | |--------------------------------------------------------------------------------------------------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | FIRST QUARTER FISCAL YEAR 2023 FINANCIAL RESULTS | | | | | | | | | | | | Mark Aslett President and CEO | | | | | | Michael Ruppert Executive Vice President and CFO | | | | | | November 1, 2022, 5:00 pm ET | | | | | | Webcast login at www.mrcy.com/investor Webcast replay available by 7:00 p.m. ET ...

Financial Data and Key Metrics Changes - Bookings increased by 34% year-over-year in Q1 2023, with a book-to-bill ratio of 1.17, compared to 0.89 in Q1 2022 [6][29] - Total revenue rose by 1% year-over-year to $228 million, exceeding guidance [30] - Adjusted EBITDA for Q1 was $31.2 million, down 19% year-over-year, with adjusted EBITDA margins at 13.7% [9][31] - Free cash flow was an outflow of $73 million, expected to improve in Q2 and throughout the second half of fiscal 2023 [9][40] Business Line Data and Key Metrics Changes - Organic revenue decreased by 4% year-over-year, with expectations for positive growth in Q2 [8] - Major revenue programs included F-35, LTAMDs, Aegis, F-18, and SEWIP [9] - Adjusted EBITDA margins decreased primarily due to a smaller proportion of higher-margin production revenue [30] Market Data and Key Metrics Changes - Backlog grew by 22% year-over-year, reaching a record $1.08 billion [29] - The company anticipates strong bookings and improved visibility into revenue for the remainder of fiscal 2023 [29][44] Company Strategy and Development Direction - The company is optimistic about entering a multiyear period of accelerating growth and profitability, similar to the post-sequestration period in 2013 [11][15] - The strategic focus includes enhancing procurement and pricing strategies to mitigate inflationary pressures [54][70] - The company is positioned to benefit from increased defense spending and supply chain improvements [18][49] Management's Comments on Operating Environment and Future Outlook - Management noted that current challenges are supply and timing-related rather than demand-related, with expectations for improved conditions in the second half of fiscal 2023 [10][14] - The geopolitical environment is viewed as challenging, with potential for increased defense spending [16][18] - Management expects to see a return to organic growth and improved cash flow as supply chain issues subside [14][40] Other Important Information - The company has implemented the 1MPACT initiative to streamline operations and improve margins [24][70] - Significant investments in working capital have been made to support performance obligations and mitigate supply chain risks [33][34] Q&A Session Summary Question: Understanding pricing actions and their impact on gross margins - Management discussed initiatives to improve procurement and pricing to offset inflationary pressures, which have been successful [54][56] Question: Concerns about customer payment behavior - Management expressed confidence in the collectibility of receivables, attributing delays to supply chain challenges rather than asset quality [57][58] Question: M&A environment and return profiles - Management acknowledged changes in the M&A environment due to rising rates but emphasized a disciplined approach to acquisitions [67][69] Question: Successes and challenges of the 1MPACT initiative - Management highlighted achievements in procurement and digital transformation, while noting that benefits are not yet fully realized due to supply chain challenges [70][72] Question: Dynamics of customer payment holdbacks - Management explained that holdbacks were observed at the end of the quarter, influenced by timing of orders and customer behaviors [75][76]