Mercury Systems Q2 Earnings Beat Estimates Despite Loss
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Should l Buy MRCY?
Source: seekingalpha
- Earnings Beat: Mercury Systems reported adjusted earnings of $0.16 per share for Q2, surpassing the consensus estimate of $0.06, although the company still posted a net loss of $15 million, indicating ongoing profitability challenges.
- Revenue Growth: The company achieved revenue of $233 million in Q2, exceeding Wall Street's expectation of $211.4 million and slightly up from $223 million a year ago, reflecting stable market demand.
- Bookings and Backlog: Q2 bookings totaled $288 million, an 18.6% year-over-year increase, resulting in a book-to-bill ratio of 1.23, with total backlog reaching a record $1.5 billion, indicating strong future revenue potential.
- Cash Flow Status: Operating cash flow was $52 million, down from the prior year, while free cash flow stood at $46 million, reflecting pressure on cash management compared to last year's unusually strong cash generation.
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Analyst Views on MRCY
Wall Street analysts forecast MRCY stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for MRCY is 81.20 USD with a low forecast of 49.00 USD and a high forecast of 102.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
6 Analyst Rating
4 Buy
1 Hold
1 Sell
Moderate Buy
Current: 93.890
Low
49.00
Averages
81.20
High
102.00
Current: 93.890
Low
49.00
Averages
81.20
High
102.00
About MRCY
Mercury Systems, Inc. is a technology company that delivers mission-critical processing power to the edge where signals and data are collected to solve the most pressing aerospace and defense challenges. The Mercury Processing Platform is the unique advantage the Company provides to its customers. It comprises the technologies the Company has developed and acquired that bring integrated, mission-critical processing capabilities to the edge. Its processing platform spans the full breadth of signal processing from the RF front end to the human-machine interface to rapidly convert meaningful data, gathered in the most remote and hostile environments, into critical decisions. It allows the Company to offer standard products and custom solutions from silicon to system scale, including components, modules, subsystems, and systems, and it embodies the customer-centric approach the Company takes to delivering capabilities that are mission-ready, secure, software-defined, and open and modular.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Mercury Systems Set to Release Q2 Earnings on February 3rd
- Earnings Announcement: Mercury Systems (MRCY) is scheduled to announce its Q2 fiscal year 2023 earnings on February 3rd after market close, with consensus EPS estimate at $0.06, reflecting a 14.3% year-over-year decline, which could negatively impact investor sentiment.
- Revenue Decline: The expected revenue for the quarter is $211.35 million, down 5.3% year-over-year, indicating challenges the company faces in the current economic environment that may affect future growth potential.
- Historical Performance Review: Over the past two years, Mercury Systems has beaten EPS estimates 63% of the time and revenue estimates 75% of the time, although recent downward revisions in EPS and revenue forecasts indicate growing market concerns about its future performance.
- Market Reaction: In the last three months, there have been no upward revisions to EPS estimates, with 7 downward adjustments, and similarly, revenue estimates have seen 8 downward revisions, suggesting a weakening analyst confidence that could lead to stock price volatility.
See More
Mercury Systems Q2 Earnings Beat Estimates Despite Loss
- Earnings Beat: Mercury Systems reported adjusted earnings of $0.16 per share for Q2, surpassing the consensus estimate of $0.06, although the company still posted a net loss of $15 million, indicating ongoing profitability challenges.
- Revenue Growth: The company achieved revenue of $233 million in Q2, exceeding Wall Street's expectation of $211.4 million and slightly up from $223 million a year ago, reflecting stable market demand.
- Bookings and Backlog: Q2 bookings totaled $288 million, an 18.6% year-over-year increase, resulting in a book-to-bill ratio of 1.23, with total backlog reaching a record $1.5 billion, indicating strong future revenue potential.
- Cash Flow Status: Operating cash flow was $52 million, down from the prior year, while free cash flow stood at $46 million, reflecting pressure on cash management compared to last year's unusually strong cash generation.
See More
Mercury Systems Q2 Earnings Exceed Expectations
- Strong Earnings Performance: Mercury Systems reported a Q2 non-GAAP EPS of $0.16, beating expectations by $0.10, which indicates a significant improvement in profitability and boosts investor confidence.
- Robust Revenue Growth: The company achieved revenues of $232.8 million in Q2, a 4.3% year-over-year increase, surpassing market expectations by $21.45 million, demonstrating sustained growth in the defense electronics sector.
- Healthy Order Situation: Total bookings for Q2 reached $288 million, resulting in a book-to-bill ratio of 1.23, reflecting the company’s successful expansion of market share amid strong demand.
- Optimistic Strategic Outlook: With expanding margins, Mercury Systems' defense electronics stock is viewed as a compelling investment opportunity, suggesting further growth potential and enhanced market competitiveness in the future.
See More
VisionWave Holdings Strategic Expansion and Technology Integration
- Defense Budget Surge: The Pentagon's 2026 budget authorization reaches $900.6 billion, prompting a comprehensive overhaul of electronic warfare and sensing technologies to address the complexities of modern threats, with the electronic warfare market projected to hit $20.01 billion this year, highlighting the urgent demand for AI signal processing.
- Strategic Transaction: VisionWave Holdings has entered into a strategic exchange agreement valued at $7 million with SaverOne 2014 Ltd., aiming to acquire approximately 51% of the company, which will integrate VisionWave's RF sensing and AI analytics into SaverOne's VRU platform to enhance concealed threat detection capabilities.
- Technology Acquisition and Integration: VisionWave recently acquired the qSpeed computational acceleration engine, valued at $99.6 million, designed to reduce decision latency between threat detection and response execution from minutes to seconds, with a commercially deployable solution expected to be demonstrated in 2026, further enhancing its market competitiveness.
- Southern Europe Market Expansion: VisionWave, through its subsidiary Solar Drone Ltd., has secured follow-on hardware orders and distribution agreements in Italy and Spain, planning to invest up to $10 million over the next 6 to 12 months to accelerate commercialization timelines and meet the demands of the infrastructure maintenance market.
See More
VisionWave Holdings Strategic Expansion and Technology Integration
- Defense Budget Surge: The 2026 U.S. defense budget reaches $900.6 billion, propelling the electronic warfare market to an expected $20.01 billion, highlighting a critical demand for AI signal processing technologies and creating significant market opportunities for companies like VisionWave Holdings.
- Strategic Transaction: VisionWave has entered into a strategic exchange agreement valued at $7 million with SaverOne, aiming to acquire approximately 51% of the company, which will integrate VisionWave's RF sensing and AI analytics into SaverOne's VRU platform to enhance concealed threat detection capabilities.
- Technology Acquisition and Integration: VisionWave's acquisition of the qSpeed computational acceleration engine, valued at $99.6 million, is expected to reduce decision latency from minutes to seconds, enhancing the responsiveness of its WaveStrike fire control systems and Argus counter-drone technology, thereby strengthening its competitive position in the market.
- Southern Europe Market Expansion: Through its subsidiary Solar Drone Ltd., VisionWave has secured follow-on hardware orders in Italy and Spain, planning to invest up to $10 million over the next 6 to 12 months to accelerate commercialization timelines, further solidifying its position in the critical infrastructure maintenance market.
See More
VisionWave Holdings Secures $151 Billion Defense Contract, Advances qSpeed Integration
- Defense Contract Award: The Pentagon awarded over 2,400 firms a total of $151 billion in contracts to mobilize the U.S. industrial base for the Golden Dome missile defense architecture, emphasizing domestic manufacturing resilience, which positions VisionWave favorably.
- qSpeed Integration Progress: VisionWave is advancing the system-level integration of its qSpeed computational acceleration engine, expected to compress decision latency from minutes to seconds, significantly enhancing response times in modern warfare and strengthening the company's competitive edge in defense.
- Patent Protection Enhanced: VisionWave secured U.S. Patent No. 12,499,578, ensuring enforceable protection for the core architecture of its Argus counter-UAS system and SkyWeave high-frequency communications backbone, solidifying its dominance in the space-enabled counter-drone market.
- European Market Expansion: VisionWave is expanding into Southern Europe through its subsidiary, Solar Drone Ltd., having secured follow-on hardware orders and a strategic distribution agreement covering Italy and Spain, further enhancing its market share in high-voltage insulator cleaning and power grid maintenance.
See More
Mercury Systems Set to Release Q2 Earnings on February 3rd
- Earnings Announcement: Mercury Systems (MRCY) is scheduled to announce its Q2 fiscal year 2023 earnings on February 3rd after market close, with consensus EPS estimate at $0.06, reflecting a 14.3% year-over-year decline, which could negatively impact investor sentiment.
- Revenue Decline: The expected revenue for the quarter is $211.35 million, down 5.3% year-over-year, indicating challenges the company faces in the current economic environment that may affect future growth potential.
- Historical Performance Review: Over the past two years, Mercury Systems has beaten EPS estimates 63% of the time and revenue estimates 75% of the time, although recent downward revisions in EPS and revenue forecasts indicate growing market concerns about its future performance.
- Market Reaction: In the last three months, there have been no upward revisions to EPS estimates, with 7 downward adjustments, and similarly, revenue estimates have seen 8 downward revisions, suggesting a weakening analyst confidence that could lead to stock price volatility.
See More
Mercury Systems Q2 Earnings Beat Estimates Despite Loss
- Earnings Beat: Mercury Systems reported adjusted earnings of $0.16 per share for Q2, surpassing the consensus estimate of $0.06, although the company still posted a net loss of $15 million, indicating ongoing profitability challenges.
- Revenue Growth: The company achieved revenue of $233 million in Q2, exceeding Wall Street's expectation of $211.4 million and slightly up from $223 million a year ago, reflecting stable market demand.
- Bookings and Backlog: Q2 bookings totaled $288 million, an 18.6% year-over-year increase, resulting in a book-to-bill ratio of 1.23, with total backlog reaching a record $1.5 billion, indicating strong future revenue potential.
- Cash Flow Status: Operating cash flow was $52 million, down from the prior year, while free cash flow stood at $46 million, reflecting pressure on cash management compared to last year's unusually strong cash generation.
See More
Mercury Systems Q2 Earnings Exceed Expectations
- Strong Earnings Performance: Mercury Systems reported a Q2 non-GAAP EPS of $0.16, beating expectations by $0.10, which indicates a significant improvement in profitability and boosts investor confidence.
- Robust Revenue Growth: The company achieved revenues of $232.8 million in Q2, a 4.3% year-over-year increase, surpassing market expectations by $21.45 million, demonstrating sustained growth in the defense electronics sector.
- Healthy Order Situation: Total bookings for Q2 reached $288 million, resulting in a book-to-bill ratio of 1.23, reflecting the company’s successful expansion of market share amid strong demand.
- Optimistic Strategic Outlook: With expanding margins, Mercury Systems' defense electronics stock is viewed as a compelling investment opportunity, suggesting further growth potential and enhanced market competitiveness in the future.
See More
VisionWave Holdings Strategic Expansion and Technology Integration
- Defense Budget Surge: The Pentagon's 2026 budget authorization reaches $900.6 billion, prompting a comprehensive overhaul of electronic warfare and sensing technologies to address the complexities of modern threats, with the electronic warfare market projected to hit $20.01 billion this year, highlighting the urgent demand for AI signal processing.
- Strategic Transaction: VisionWave Holdings has entered into a strategic exchange agreement valued at $7 million with SaverOne 2014 Ltd., aiming to acquire approximately 51% of the company, which will integrate VisionWave's RF sensing and AI analytics into SaverOne's VRU platform to enhance concealed threat detection capabilities.
- Technology Acquisition and Integration: VisionWave recently acquired the qSpeed computational acceleration engine, valued at $99.6 million, designed to reduce decision latency between threat detection and response execution from minutes to seconds, with a commercially deployable solution expected to be demonstrated in 2026, further enhancing its market competitiveness.
- Southern Europe Market Expansion: VisionWave, through its subsidiary Solar Drone Ltd., has secured follow-on hardware orders and distribution agreements in Italy and Spain, planning to invest up to $10 million over the next 6 to 12 months to accelerate commercialization timelines and meet the demands of the infrastructure maintenance market.
See More
VisionWave Holdings Strategic Expansion and Technology Integration
- Defense Budget Surge: The 2026 U.S. defense budget reaches $900.6 billion, propelling the electronic warfare market to an expected $20.01 billion, highlighting a critical demand for AI signal processing technologies and creating significant market opportunities for companies like VisionWave Holdings.
- Strategic Transaction: VisionWave has entered into a strategic exchange agreement valued at $7 million with SaverOne, aiming to acquire approximately 51% of the company, which will integrate VisionWave's RF sensing and AI analytics into SaverOne's VRU platform to enhance concealed threat detection capabilities.
- Technology Acquisition and Integration: VisionWave's acquisition of the qSpeed computational acceleration engine, valued at $99.6 million, is expected to reduce decision latency from minutes to seconds, enhancing the responsiveness of its WaveStrike fire control systems and Argus counter-drone technology, thereby strengthening its competitive position in the market.
- Southern Europe Market Expansion: Through its subsidiary Solar Drone Ltd., VisionWave has secured follow-on hardware orders in Italy and Spain, planning to invest up to $10 million over the next 6 to 12 months to accelerate commercialization timelines, further solidifying its position in the critical infrastructure maintenance market.
See More
VisionWave Holdings Secures $151 Billion Defense Contract, Advances qSpeed Integration
- Defense Contract Award: The Pentagon awarded over 2,400 firms a total of $151 billion in contracts to mobilize the U.S. industrial base for the Golden Dome missile defense architecture, emphasizing domestic manufacturing resilience, which positions VisionWave favorably.
- qSpeed Integration Progress: VisionWave is advancing the system-level integration of its qSpeed computational acceleration engine, expected to compress decision latency from minutes to seconds, significantly enhancing response times in modern warfare and strengthening the company's competitive edge in defense.
- Patent Protection Enhanced: VisionWave secured U.S. Patent No. 12,499,578, ensuring enforceable protection for the core architecture of its Argus counter-UAS system and SkyWeave high-frequency communications backbone, solidifying its dominance in the space-enabled counter-drone market.
- European Market Expansion: VisionWave is expanding into Southern Europe through its subsidiary, Solar Drone Ltd., having secured follow-on hardware orders and a strategic distribution agreement covering Italy and Spain, further enhancing its market share in high-voltage insulator cleaning and power grid maintenance.
See More
