Science Applications International reported $1.88 billion in revenue for the second quarter of fiscal 2027, a 6.3% increase year over year (5.3% on an organic basis), and narrowed to a net income of $102 million, the company said Monday.
Operational results and guidance
SAIC said adjusted earnings before interest, taxes, depreciation and amortization came to $193 million, equal to 10.3% of revenues. Adjusted diluted earnings per share were $3.01 for the quarter, down from an adjusted $3.63 in the prior-year quarter. Operating income for the period was $152 million, an operating margin of 8.1%.
Following the quarter, the company raised its fiscal 2027 guidance for revenue, adjusted EBITDA, adjusted EBITDA margin and adjusted diluted EPS while reiterating its free cash flow outlook. Management set adjusted EBITDA guidance at $750 million to $755 million with margin guidance of 10.3%–10.5%.
Contracts, bookings and backlog
SAIC reported net bookings of approximately $1.2 billion for the quarter, producing a quarterly book-to-bill ratio of 0.6 and a trailing 12-month book-to-bill of 0.8. Estimated backlog stood at about $22.1 billion, of which roughly $3.8 billion is funded.
Notable contract awards during the quarter included several multi-year recompetes and task orders supporting U.S. national security customers. Key awards reported by the company included:
- About $400 million over five years supporting a U.S. intelligence agency (recompete).
- About $330 million over five years for U.S. Army systems-of-systems, systems engineering, live-virtual-constructive and modeling and simulation work.
- About $130 million over five years providing airborne electronic warfare systems testing and acquisition support to the U.S. Navy.
SAIC also disclosed notable awards after the reporting period, including an approximately $740 million five-year recompete with the U.S. Department of Homeland Security for Customs and Border Protection operations and maintenance, and placement on the COMET indefinite-delivery/indefinite-quantity vehicle with MSIC, an IDIQ SAIC estimated at $14 billion total vehicle value.
Segment and cash performance
On a segment basis, Defense and Intelligence revenues totaled $1,449 million with an adjusted operating margin of 9.5%. Civilian revenues were $431 million with an adjusted operating margin of 13.0%. Operating cash flow for the quarter was $146 million, and free cash flow was $131 million.
During the quarter the company repurchased $90 million of its shares and paid $16 million in dividends.
| Metric | Q2 Fiscal 2027 |
|---|---|
| Revenue | $1.88 billion |
| Net income | $102 million |
| Adjusted EBITDA | $193 million (10.3%) |
| Adjusted diluted EPS | $3.01 |
| Estimated backlog | $22.1 billion (~$3.8B funded) |
Implications for federal technology and defense spending
The quarter highlights SAIC's continued reliance on multiyear contracts with U.S. defense and civilian agencies. A sizable backlog and several recompetes with federal customers underscore the company's embedded role in sustaining and modernizing government systems, from intelligence operations to modeling and simulation and airborne electronic-warfare testing.
Analysts watching the sector typically view book-to-bill ratios and funded backlog as indicators of near-term revenue visibility. With a quarterly book-to-bill of 0.6 and trailing 12-month book-to-bill of 0.8, SAIC's bookings in the quarter lagged billings, even as the company secured large recompetes that extend revenue opportunity over multiple years.
As federal agencies continue to prioritize technology modernization and readiness, companies such as SAIC that provide engineering, integration and life-cycle support play a central role. The raised guidance signals management confidence in margin expansion and cash generation for fiscal 2027, while continued share repurchases and dividend payments reflect a balance between returning cash to investors and investing in contract delivery.
Future performance will hinge on execution of multiyear taskings, the pace of funded workflow from customers and broader federal procurement trends.
