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In hypersonics—arguably the single most urgent gap in U.S. deterrence—Kratos is a prime contractor on the Pentagon’s MACH-TB 2.0 flight-test program and is expanding ground-test capacity. Whoever owns the testing infrastructure for an entire weapons class owns a recurring, capacity-constrained toll road, and Kratos is building exactly that. Add a fast-growing space and satellite business (a 3-to-1 book-to-bill quarter and a $446.8 million Space Systems Command award), microwave electronics, and directed energy, and the company becomes a diversified arsenal of next-generation capability rather than a single-product bet.The financial trajectory confirms the thesis is converting. First-quarter 2026 revenue grew 22.6% to $371 million; backlog hit a record $2.0 billion on a 1.6-to-1 book-to-bill; and the opportunity pipeline swelled to roughly $14 billion. The growth ahead is a conversion story: turning that pipeline into full-rate production. As generational programs move from development to volume, fixed-cost absorption should lift today’s thin ~2% net margins meaningfully—on 20%+ revenue growth, even modest margin expansion compounds into outsized earnings power.
In hypersonics—arguably the single most urgent gap in U.S. deterrence—Kratos is a prime contractor on the Pentagon’s MACH-TB 2.0 flight-test program and is expanding ground-test capacity. Whoever owns the testing infrastructure for an entire weapons class owns a recurring, capacity-constrained toll road, and Kratos is building exactly that. Add a fast-growing space and satellite business (a 3-to-1 book-to-bill quarter and a $446.8 million Space Systems Command award), microwave electronics, and directed energy, and the company becomes a diversified arsenal of next-generation capability rather than a single-product bet.
The financial trajectory confirms the thesis is converting. First-quarter 2026 revenue grew 22.6% to $371 million; backlog hit a record $2.0 billion on a 1.6-to-1 book-to-bill; and the opportunity pipeline swelled to roughly $14 billion. The growth ahead is a conversion story: turning that pipeline into full-rate production. As generational programs move from development to volume, fixed-cost absorption should lift today’s thin ~2% net margins meaningfully—on 20%+ revenue growth, even modest margin expansion compounds into outsized earnings power.
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