Mercury Systems reported second-quarter earnings that significantly exceeded analyst expectations, driving a notable surge in its stock price. The company posted an adjusted earnings per share (EPS) of $0.07, a stark contrast to the anticipated loss of $0.08 per share. This represents an earnings surprise of 187.50%. Revenue for the quarter reached $223.13 million, surpassing the consensus estimate of $180.52 million by 23.60% and marking a 13% increase year-over-year. The strong performance was bolstered by substantial growth in its Sensor & Effector segment, particularly in the Radar category, which saw a 255.4% increase in revenue compared to the previous year.
The company's operational achievements were further highlighted by a record backlog of $1.4 billion, reflecting a 6% increase from the previous year. Mercury Systems also reported a significant improvement in adjusted EBITDA, reaching $22.0 million, alongside a record operating cash flow of $85.5 million. CEO Bill Ballhaus expressed confidence in the company's strategic initiatives and execution improvements, indicating that the results were meeting or surpassing expectations. This optimistic outlook, coupled with the strong financial performance, has likely contributed to the positive investor sentiment surrounding the stock.
Mercury Systems (MRCY) shares are up 21.34% to $51.07 as of 6:41 am on February 5th, compared to its previous close of $42.09 on February 4th.