Detailed financial statements for Kratos Defense & Security Solutions, Inc. (KTOS): income statement, balance sheet and cash-flow summary. Track margins, debt, liquidity and profitability trends year over year: ten fiscal years free and up to 20 with Premium.
Kratos Defense & Security Solutions, Inc. primarily functions as a contractor for the United States Department of Defense. Its business operations are organized into two distinct divisions: Kratos Government Solutions and Unmanned Systems.
Analysis Summary
Kratos Defense & Security Solutions, Inc. reported revenue of $1.35B in the most recent fiscal year, growing at a 5-year CAGR of 12.5%. Net income reached $22.0M, with a -22.7% 5-year CAGR.
Trailing-twelve-month margins: gross margin 22.0%, operating margin 1.5%, net margin 2.0%.
At the current price of $43.07, KTOS trades at a P/E of 250.55 and an ROE of 1.14%. Market capitalisation stands at $8.1B.
Balance sheet quality for KTOS: current ratio of 4.1, net cash position of $414.8M. A debt-to-equity below 1.0 typically signals conservative capital structure, while a current ratio above 1.5 indicates comfortable short-term liquidity.
Cash flow quality is below average: free cash flow of -$137.4M represents -625% conversion of reported net income. High conversion (above 90%) suggests earnings translate cleanly into cash; lower conversion may indicate working capital tightness or accounting timing differences.
Income Statement (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $668.7M | $751.9M | $618.0M | $717.5M | $747.7M | $811.5M | $898.3M | $1.04B | $1.14B | $1.35B |
| Cost of Revenue | $515.1M | $554.6M | $448.3M | $527.5M | $544.5M | $586.4M | $672.3M | $768.5M | $849.1M | $1.05B |
| Gross Profit | $153.6M | $197.3M | $169.7M | $190.0M | $203.2M | $225.1M | $226.0M | $268.6M | $287.2M | $298.3M |
| Research & Development | $13.9M | $17.8M | $15.6M | $18.0M | $27.0M | $35.2M | $38.6M | $38.4M | $40.3M | $40.0M |
| Selling, General & Admin | $132.6M | $147.5M | $110.9M | $130.8M | $144.5M | $160.2M | $182.8M | $197.8M | $214.0M | $230.6M |
| Operating Expenses | $160.2M | $178.4M | $135.4M | $152.0M | $173.9M | $197.2M | $228.9M | $237.5M | $258.2M | $270.6M |
| Operating Income | -$18.6M | -$5.8M | $30.5M | $38.0M | $29.3M | $27.9M | -$2.9M | $31.1M | $29.0M | $27.7M |
| EBITDA | $5.2M | -$5.8M | $48.1M | $74.3M | $64.4M | $62.8M | $26.2M | $77.5M | $93.6M | $103.8M |
| Interest Expense | $34.7M | $29.1M | $21.6M | $23.5M | $23.6M | $23.7M | $18.3M | $21.7M | $15.2M | $10.5M |
| Pre-tax Income | -$52.3M | -$50.8M | $8.7M | $15.7M | $6.8M | $4.4M | -$33.0M | $11.1M | $26.5M | $34.0M |
| Income Tax | $8.1M | -$8.2M | $4.6M | $4.8M | -$73.5M | $3.9M | $200,000 | $8.7M | $10.2M | $12.0M |
| Net Income | -$60.5M | -$42.7M | -$3.5M | $12.5M | $79.6M | -$2.0M | -$36.9M | -$8.9M | $16.3M | $22.0M |
| EPS | $-0.99 | $-0.48 | $-0.03 | $0.12 | $0.69 | $-0.02 | $-0.29 | $-0.07 | $0.11 | $0.13 |
| EPS (Diluted) | $-0.99 | $-0.48 | $-0.03 | $0.11 | $0.67 | $-0.02 | $-0.29 | $-0.07 | $0.11 | $0.13 |
| Shares Outstanding (Diluted) | $61.3M | $89.5M | $106.1M | $109.2M | $118.7M | $128.0M | $126.7M | $130.4M | $150.9M | $173.1M |
Income Statement (Quarterly)
| Year | 2025-Q3 | 2025-Q4 | 2026-Q1 | 2026-Q2 |
|---|---|---|---|---|
| Revenue | $347.6M | $345.1M | $371.0M | $458.8M |
| Gross Profit | $77.1M | $73.8M | $83.8M | $100.1M |
| Operating Income | $7.1M | $10.3M | $7.7M | -$1.6M |
| EBITDA | $23.8M | $31.3M | $34.5M | $28.9M |
| Net Income | $8.7M | $5.9M | $11.9M | $4.4M |
| EPS | $0.05 | $0.03 | $0.07 | $0.02 |
| EPS (Diluted) | $0.05 | $0.03 | $0.07 | $0.02 |
Balance Sheet (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Cash & Equivalents | $69.1M | $129.6M | $182.7M | $172.6M | $380.8M | $349.4M | $81.3M | $72.8M | $329.3M | $560.6M |
| Short-term Investments | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Receivables | $234.0M | $212.3M | $237.4M | $264.1M | $272.2M | $284.6M | $328.3M | $329.1M | $323.7M | $457.3M |
| Inventory | $55.4M | $50.4M | $46.8M | $61.1M | $81.2M | $91.7M | $125.5M | $156.2M | $162.1M | $188.2M |
| Total Current Assets | $373.1M | $471.3M | $494.7M | $522.2M | $764.8M | $758.1M | $582.6M | $594.2M | $872.1M | $1.26B |
| Property, Plant & Equipment | $49.8M | $61.2M | $67.1M | $159.0M | $186.7M | $206.8M | $260.5M | $289.3M | $325.8M | $405.3M |
| Goodwill | $485.4M | $461.2M | $425.7M | $455.6M | $483.9M | $493.9M | $558.2M | $569.1M | $568.9M | $595.7M |
| Intangible Assets | $32.6M | $22.0M | $16.1M | $39.5M | $43.0M | $43.2M | $55.2M | $62.4M | $53.8M | $53.9M |
| Total Assets | $948.6M | $1.02B | $1.01B | $1.19B | $1.56B | $1.59B | $1.55B | $1.63B | $1.95B | $2.47B |
| Accounts Payable | $52.7M | $34.7M | $46.6M | $53.8M | $55.4M | $50.4M | $57.3M | $63.1M | $82.0M | $69.6M |
| Short-term Debt | $1.0M | $800,000 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Total Current Liabilities | $196.5M | $188.9M | $164.7M | $182.7M | $197.6M | $221.1M | $234.2M | $292.5M | $296.7M | $311.0M |
| Long-term Debt | $431.0M | $293.5M | $294.2M | $295.1M | $301.0M | $296.7M | $250.2M | $219.3M | $174.6M | 0 |
| Total Liabilities | $672.2M | $512.5M | $490.8M | $596.9M | $622.7M | $629.2M | $604.0M | $634.0M | $597.7M | $470.9M |
| Retained Earnings | -$678.1M | -$720.8M | -$724.5M | -$712.0M | -$632.4M | -$634.4M | -$671.3M | -$680.2M | -$663.9M | -$641.9M |
| Total Equity | $276.4M | $511.5M | $519.3M | $574.1M | $925.3M | $945.1M | $936.3M | $976.0M | $1.35B | $2.00B |
| Total Debt | $432.0M | $294.3M | $294.2M | $342.6M | $348.5M | $339.5M | $301.8M | $321.4M | $282.0M | $145.8M |
| Net Debt | $362.9M | $164.7M | $111.5M | $170.0M | -$32.3M | -$9.9M | $220.5M | $248.6M | -$47.3M | -$414.8M |
| Working Capital | $176.6M | $282.4M | $330.0M | $339.5M | $567.2M | $537.0M | $348.4M | $301.7M | $575.4M | $951.9M |
Balance Sheet (Quarterly)
| Year | 2025-Q3 | 2025-Q4 | 2026-Q1 | 2026-Q2 |
|---|---|---|---|---|
| Cash & Equivalents | $565.9M | $560.6M | $1.46B | $1.44B |
| Total Assets | $2.42B | $2.47B | $4.04B | $4.09B |
| Total Liabilities | $441.8M | $470.9M | $632.7M | $663.0M |
| Total Equity | $1.98B | $2.00B | $3.41B | $3.43B |
| Total Debt | $134.3M | $145.8M | $185.4M | $193.6M |
Cash Flow (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Net Income | -$60.5M | -$42.7M | -$3.5M | $12.5M | $79.4M | -$1.6M | -$36.9M | -$8.9M | $16.3M | $22.0M |
| Depreciation & Amortization | $22.8M | $22.5M | $17.9M | $36.1M | $34.0M | $34.7M | $41.7M | $44.7M | $51.9M | $59.3M |
| Stock-based Compensation | $5.1M | $7.8M | $7.2M | $11.0M | $21.0M | $25.8M | $26.3M | $25.3M | $29.8M | 0 |
| Change in Working Capital | $2.1M | -$48.1M | -$13.5M | -$28.2M | -$13.4M | -$26.1M | -$83.2M | -$11.2M | -$53.4M | -$168.0M |
| Operating Cash Flow | -$12.4M | -$27.0M | $18.1M | $30.0M | $46.6M | $30.8M | -$25.7M | $65.2M | $49.7M | -$42.1M |
| Capital Expenditure | -$9.2M | -$26.5M | -$22.6M | -$26.3M | -$35.9M | -$46.5M | -$45.4M | -$52.4M | -$58.2M | -$95.3M |
| Acquisitions | -$5.1M | $700,000 | -$2.9M | -$17.7M | -$51.5M | -$12.3M | -$132.2M | $300,000 | -$11.5M | $12.0M |
| Stock Repurchased | 0 | 0 | -$1.1M | -$900,000 | 0 | 0 | -$12.5M | 0 | 0 | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Free Cash Flow | -$21.6M | -$53.5M | -$4.5M | $3.7M | $10.7M | -$15.7M | -$71.1M | $12.8M | -$8.5M | -$137.4M |
Cash Flow (Quarterly)
| Year | 2025-Q3 | 2025-Q4 | 2026-Q1 | 2026-Q2 |
|---|---|---|---|---|
| Operating Cash Flow | -$13.3M | $12.1M | -$28.5M | -$9.9M |
| Capital Expenditure | -$28.0M | -$24.2M | -$19.9M | -$17.2M |
| Free Cash Flow | -$41.3M | -$12.1M | -$48.4M | -$27.1M |
| Dividends Paid | 0 | 0 | 0 | 0 |
| Stock-based Compensation | $9.1M | -$26.4M | 0 | $31.3M |
Growth & Margins (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue Growth (YoY) | +12.4% | -17.8% | +16.1% | +4.2% | +8.5% | +10.7% | +15.5% | +9.6% | +18.5% | |
| Net Income Growth (YoY) | +29.4% | +91.8% | +457.1% | +536.8% | -102.5% | -1,745.0% | +75.9% | +283.1% | +35.0% | |
| EPS Growth (YoY) | +51.5% | +93.0% | +456.1% | +475.0% | -102.9% | -1,350.0% | +75.9% | +257.1% | +18.2% | |
| Shares Change (YoY) | +46.0% | +18.5% | +2.9% | +8.7% | +7.8% | -1.0% | +2.9% | +15.7% | +14.7% | |
| FCF Growth (YoY) | -147.7% | +91.6% | +182.2% | +189.2% | -246.7% | -352.9% | +118.0% | -166.4% | -1,516.5% | |
| Gross Margin | 23.0% | 26.2% | 27.5% | 26.5% | 27.2% | 27.7% | 25.2% | 25.9% | 25.3% | 22.1% |
| Operating Margin | -2.8% | -0.8% | 4.9% | 5.3% | 3.9% | 3.4% | -0.3% | 3.0% | 2.6% | 2.1% |
| EBITDA Margin | 0.8% | -0.8% | 7.8% | 10.4% | 8.6% | 7.7% | 2.9% | 7.5% | 8.2% | 7.7% |
| Net Margin | -9.0% | -5.7% | -0.6% | 1.7% | 10.6% | -0.2% | -4.1% | -0.9% | 1.4% | 1.6% |
| FCF Margin | -3.2% | -7.1% | -0.7% | 0.5% | 1.4% | -1.9% | -7.9% | 1.2% | -0.7% | -10.2% |
| Effective Tax Rate | -15.5% | 16.1% | 52.9% | 30.6% | -1,080.9% | 88.6% | -0.6% | 78.4% | 38.5% | 35.3% |
Per-Share Data (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| FCF Per Share | $-0.35 | $-0.60 | $-0.04 | $0.03 | $0.09 | $-0.12 | $-0.56 | $0.10 | $-0.06 | $-0.79 |
| Dividends Per Share | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| Shares Outstanding (Basic) | $61.3M | $89.5M | $103.8M | $106.0M | $115.5M | $124.6M | $126.7M | $130.4M | $149.0M | $172.2M |
What to look at in Industrials
Aerospace, defence, machinery, transport. Semi-cyclical. Key: backlog, operating margins, and FCF conversion.
- 5y revenue growth — Without growth, there is no long-term value creation
- Operating margin — The best indicator of operational discipline in industrials
- ROIC — Quality industrials have ROIC >15% — the rest destroy capital
- FCF conversion — FCF / Net Income — in industrials good >85%
- Net debt / EBITDA — Cyclical industrials with high debt suffer hard in recessions
- Capex / Revenue — Maintaining the machinery. <4% = possible underinvestment (future decline)
- Altman Z-Score — Bankruptcy model (NYU 1968) — combines liquidity, leverage and profitability. Key in cyclicals
Profitability
| Return on Equity | 1.14% |
| Return on Invested Capital | 0.48% |
| Return on Assets | 0.76% |
| Gross Margin | 21.99% |
| Operating Margin | 1.54% |
| Net Margin | 2.03% |
Financial Health
| Debt / Equity | 0.06 |
| Current Ratio | 5.54 |
| Piotroski F-Score | 5 |
| Altman Z-Score | 17.68 |
Key Ratios (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| P/E | -7.47 | -22.06 | -418.10 | 150.08 | 39.75 | -970.00 | -35.59 | -289.86 | 241.09 | 595.92 |
| P/B | 1.64 | 1.85 | 2.82 | 3.33 | 3.42 | 2.56 | 1.40 | 2.71 | 2.92 | 6.68 |
| P/S | 0.68 | 1.26 | 2.37 | 2.66 | 4.24 | 2.98 | 1.46 | 2.55 | 3.48 | 9.91 |
| Gross Margin | 23.0% | 26.2% | 27.5% | 26.5% | 27.2% | 27.7% | 25.2% | 25.9% | 25.3% | 22.1% |
| Operating Margin | -2.8% | -0.8% | 4.9% | 5.3% | 3.9% | 3.4% | -0.3% | 3.0% | 2.6% | 2.1% |
| Net Margin | -9.0% | -5.7% | -0.6% | 1.7% | 10.6% | -0.2% | -4.1% | -0.9% | 1.4% | 1.6% |
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Explore sector: Industrials · Aerospace & Defense
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