Karman (KRMN) Q2 Revenue Jumps 35%

Core Insights - Karman reported strong financial results for Q2 fiscal 2025, with GAAP revenue of $115.1 million and non-GAAP adjusted EPS of $0.10, both exceeding Wall Street expectations [1][2] - The company experienced significant year-over-year growth in revenue and profitability metrics, driven by strong demand across its key markets [5][8] Financial Performance - Non-GAAP EPS increased by 233.3% year-over-year, from $0.03 in Q2 fiscal 2024 to $0.10 in Q2 fiscal 2025 [2] - GAAP revenue rose by 35.3% year-over-year, from $85.0 million in Q2 fiscal 2024 to $115.1 million in Q2 fiscal 2025 [2] - Adjusted EBITDA reached $35.3 million, a 28.7% increase from $27.4 million in the same quarter last year [2] - Funded backlog increased to $719.3 million, marking a 24.1% rise compared to the end of Q4 fiscal 2024 [6] Business Overview - Karman specializes in aerospace and defense, focusing on mission-critical systems for space and missile defense, tactical missiles, and launch applications [3] - The company serves a diverse customer base, including government agencies and prime defense contractors, with over 100 funded programs [3] Strategic Initiatives - Karman is expanding through internal product development and acquisitions to enhance technical capabilities and market reach [4] - Recent acquisitions, including MTI and ISP, aim to strengthen the company's design and manufacturing footprint, although they have increased expenses [7] Market Dynamics - The company achieved double-digit revenue growth across all main end markets, with notable contributions from hypersonics, strategic missile defense, space and launch, and tactical missiles [5] - Increased contract activity in high-urgency areas, such as hypersonics, continues to drive revenue growth [6] Future Outlook - Management raised its financial guidance for fiscal 2025, projecting revenue between $452 million and $458 million, and non-GAAP adjusted EBITDA between $138.5 million and $141.5 million [10] - The revised forecasts imply approximately a 32% year-over-year increase at the midpoint, reflecting confidence in order activity and contract execution [10]