Mercury Systems Reports 1.5% Revenue Increase and Improved Net Loss in Q3 Fiscal 2025

Mercury Systems, Inc. reported a modest increase in revenue for the third quarter of fiscal 2025, achieving $211.4 million, up 1.5% from $208.3 million in the same period last year. The company’s net loss for the quarter was $19.2 million, or $0.33 per diluted share, a significant improvement compared to a net loss of $44.6 million, or $0.77 per diluted share, in the prior year. For the nine months ended March 28, 2025, total revenues reached $638.9 million, an 8.9% increase from $586.7 million in the previous year, while the net loss narrowed to $54.3 million from $126.9 million.

The company’s gross margin improved to 27.0% in the third quarter, up from 19.5% a year earlier, primarily due to favorable changes in estimates on programs recognized over time and lower inventory reserves. Operating expenses decreased to $74.5 million from $86.3 million, driven by reductions in research and development costs and restructuring charges. The company incurred $4.9 million in restructuring costs during the quarter, down from $9.8 million in the prior year, as it continues to streamline operations following workforce reductions initiated in previous fiscal periods.

Mercury Systems has made strategic moves to enhance its operational efficiency, including a workforce reduction that eliminated approximately 145 positions in January 2025. The company also reported a significant increase in cash and cash equivalents, which rose to $269.8 million as of March 28, 2025, compared to $180.5 million a year earlier. This increase was attributed to improved cash flow from operations, which generated $100.8 million during the nine months, a turnaround from an outflow of $11.4 million in the same period last year.

The company continues to focus on its core markets, with products deployed in over 300 programs across 35 countries. Mercury Systems has also been active in exploring acquisitions to expand its technological capabilities, particularly in the sensor and effector markets. As of the latest report, the company had 2,200 employees and is committed to fostering a diverse and inclusive workplace to drive innovation.

Looking ahead, Mercury Systems anticipates that existing cash, cash generated from operations, and available credit will be sufficient to meet its cash requirements for at least the next twelve months. The company remains cautious about potential impacts from tariffs and trade policies, which could affect manufacturing costs and demand for its products.