SAIC Reports Decrease in Revenues but Increase in Net Income for Q2 Fiscal 2026

Science Applications International Corporation (SAIC) reported its financial results for the second quarter of fiscal 2026, revealing a decrease in revenues and a notable increase in net income compared to the same period last year. For the three months ended August 1, 2025, SAIC generated revenues of $1.769 billion, a decline of 3% from $1.818 billion in the prior year. However, net income rose significantly to $127 million, up 57% from $81 million in the same quarter of the previous year. The company's diluted earnings per share also increased to $2.71, compared to $1.58 a year earlier.

In the first half of fiscal 2026, SAIC's revenues totaled $3.646 billion, down slightly from $3.665 billion in the same period last year. The decrease in revenue was attributed primarily to contract completions and a reduction in volume on existing contracts, although this was partially offset by new contracts. Operating income for the six months was $260 million, a decrease from $265 million in the prior year, while the operating margin improved slightly to 7.1% from 7.2%. The company’s effective tax rate also saw a significant drop to -17.2% for the quarter, largely due to a $47 million benefit from an IRS audit settlement.

SAIC has made strategic moves to enhance its market position, including a focus on integrating emerging technologies into its service offerings. The company operates through two reportable segments: Defense and Intelligence, and Civilian, with a total of approximately 1,700 active contracts. As of August 1, 2025, SAIC reported a total backlog of $23.172 billion, which includes $3.594 billion in funded backlog. The company expects to recognize a substantial portion of this backlog as revenue in the coming year.

Operationally, SAIC's workforce has decreased to approximately 24,000 employees, down from 26,000 a year prior, reflecting ongoing adjustments to align with contract demands. The company reported net bookings of $2.6 billion for the quarter, contributing to a total backlog that positions it well for future revenue generation. The company continues to focus on cost management and efficiency improvements, which are critical in a competitive bidding environment for government contracts.

Looking ahead, SAIC remains cautiously optimistic about its growth prospects, particularly in light of recent government spending packages that could increase funding for defense and technology initiatives. However, the company acknowledges potential risks associated with government budget approvals and the competitive landscape. SAIC's management is committed to leveraging its established relationships and technical expertise to navigate these challenges and capitalize on emerging opportunities in the market.