Kratos Sales Up 36%, Free Cash Flow Negative: Rapid Earnings Reaction
Kratos Defense & Security Solutions reported 36% revenue growth to $471.8 million in Q3 with record backlog of $2.65 billion, driven by strong defense demand. However, the company posted a GAAP operating loss of $4.9 million and negative free cash flow of $29.4 million in the quarter, with expectations to consume $110-120 million in cash for the full year. Heavy investment spending is expected to continue pressuring free cash flow through 2027.