KBR Reports Revenue Increase and Net Income Growth in Q2 Fiscal 2026

KBR, Inc. reported a slight increase in revenue for the second quarter of fiscal 2026, with total revenues reaching $1.984 billion, up from $1.952 billion in the same period last year. The company’s net income attributable to KBR rose to $96 million, compared to $73 million in the prior year, reflecting a 32% increase. Basic earnings per share from continuing operations were $0.74, down from $0.81 a year earlier. The increase in revenue was primarily driven by growth in the Sustainable Technology Solutions (STS) segment, which saw a 10% rise in revenues, while the Mission Technology Solutions (MTS) segment experienced a 2% decline.

In the first half of fiscal 2026, KBR's total revenues decreased by 2% to $3.907 billion from $3.970 billion in the same period of the previous year. The decline was attributed to reduced contingent activity within the MTS segment, which offset gains in the STS segment. The company reported a net income of $200 million for the six months ended July 3, 2026, compared to $173 million in the prior year. The decrease in revenues was accompanied by a reduction in selling, general, and administrative expenses, which fell by 8% to $262 million.

KBR has been actively preparing for the planned spin-off of its Mission Technology Solutions business, which is expected to be completed on January 4, 2027. The company incurred $31 million in spin-off costs during the second quarter and $46 million in the first half of the fiscal year. This strategic move aims to create a standalone, publicly traded company, allowing KBR to focus on its core operations and enhance shareholder value. The spin-off is subject to customary conditions, including regulatory approvals and favorable tax treatment.

Operationally, KBR's backlog of unfilled orders increased to $17.805 billion as of July 3, 2026, up from $16.864 billion at the beginning of the year. The MTS segment accounted for $12.282 billion of this backlog, while the STS segment contributed $5.523 billion. The company expects that approximately 38% of its backlog will be executed within the next year. KBR's equity in earnings from unconsolidated affiliates also saw an increase, rising to $103 million for the first half of fiscal 2026, compared to $93 million in the previous year.

Looking ahead, KBR anticipates continued growth driven by defense modernization and sustainable technology initiatives. The company remains focused on maintaining responsible leverage, funding organic growth, and pursuing strategic acquisitions. Despite the challenges posed by market conditions and geopolitical factors, KBR is well-positioned to capitalize on opportunities in both the defense and sustainable technology sectors.