Kratos Defense & Security Solutions Reports Strong Q4 Results

Highlights accelerating demand across national security product lines and continued investment in facilities and R&D.

Published on Feb. 27, 2026

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Kratos Defense & Security Solutions (NASDAQ:KTOS) reported strong fourth-quarter and full-year 2025 results, with revenue exceeding guidance and 20% organic growth. The company cited accelerating demand across several national security-focused product lines, including hypersonics, and continued heavy investment in facilities and internally funded development programs.

Why it matters

Kratos is a key player in the defense and national security technology space, providing critical products and services to government and military customers. The company's strong performance and growth outlook, particularly in high-priority areas like hypersonics, underscore the increasing demand for advanced defense capabilities.

The details

Kratos reported Q4 revenue of $345.1 million, above the company's estimated range, and adjusted EBITDA of $34.1 million, slightly above guidance. CEO Eric DeMarco highlighted the company's record backlog of $1.573 billion and opportunity pipeline of $13.7 billion, as well as a 1.3-to-1 book-to-bill ratio in Q4. The space and satellite business ended the quarter with a record $600 million backlog. DeMarco emphasized hypersonics as a key growth driver, with 120 rocket motors on order and a new Maryland facility to support the ramp-up. In unmanned systems, the company is planning to increase Valkyrie production from 8 to 40 aircraft annually by 2028.

  • Kratos reported Q4 2025 and full-year 2025 results on February 27, 2026.
  • The company expects Q1 2026 to be the lowest quarter for revenue and adjusted EBITDA due to the impact of the Q4 2025 federal government shutdown.
  • Kratos guided to full-year 2026 revenue of $1.59 billion to $1.675 billion, implying 12.7% to 18.5% organic growth over 2025.

The players

Kratos Defense & Security Solutions

A technology-driven company that specializes in national security and defense solutions for government and military customers, with core capabilities spanning unmanned systems, satellite communications, missile defense, cyber security, and directed-energy weapons.

Eric DeMarco

Chief Executive Officer of Kratos Defense & Security Solutions.

Deanna Lund

Chief Financial Officer of Kratos Defense & Security Solutions.

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What they’re saying

“We must not let individuals continue to damage private property in San Francisco.”

— Robert Jenkins, San Francisco resident (San Francisco Chronicle)

What’s next

Kratos is planning to increase Valkyrie production from about 8 aircraft annually to about 40 aircraft annually by the end of 2028, while maintaining some 'white tail' aircraft in inventory.

The takeaway

Kratos' strong performance and growth outlook, particularly in high-priority areas like hypersonics, underscore the increasing demand for advanced defense capabilities and the company's position as a key player in the national security technology space.