SAIC Reports 2% Revenue Growth to $1.877 Billion, Net Income Declines by 12%

Science Applications International Corporation (SAIC) reported its financial results for the three months ended May 2, 2025, revealing a revenue increase of 2% to $1.877 billion, compared to $1.847 billion in the same period last year. The company's operating income decreased by 8% to $121 million, down from $131 million, reflecting a decline in operating income as a percentage of revenues from 7.1% to 6.4%. Net income also fell by 12% to $68 million, compared to $77 million in the prior year, resulting in diluted earnings per share of $1.42, down from $1.48.

The financial performance was influenced by a ramp-up in volume from existing and new contracts, which was partially offset by contract completions. The cost of revenues increased by 2% to $1.668 billion, primarily due to higher operational expenses. Selling, general, and administrative expenses rose by 5% to $89 million, contributing to the decline in operating income. The effective income tax rate increased to 20.6% from 19.0% in the previous year, primarily due to lower tax benefits from employee share-based compensation.

SAIC's operational metrics indicate a stable business environment, with approximately 1,700 active contracts and a workforce of around 24,000 employees. The company reported a total backlog of $22.343 billion as of May 2, 2025, which includes $3.265 billion in funded backlog. The company achieved net bookings of approximately $2.4 billion during the quarter, reflecting ongoing demand for its services, particularly in the Defense and Intelligence segment, which generated $1.433 billion in revenues, virtually unchanged from the previous year.

Strategically, SAIC continues to focus on integrating emerging technologies into its service offerings, with an emphasis on IT modernization, digital engineering, and artificial intelligence. The company has maintained its commitment to innovation through its Innovation Factory, which develops enterprise-class solutions to meet complex customer needs. Despite facing challenges such as increased competition and potential government budget constraints, SAIC remains optimistic about its future, citing its strong customer relationships and technical expertise as key differentiators in the market.

Looking ahead, SAIC anticipates continued revenue growth driven by its extensive backlog and the potential for new contract awards. However, the company acknowledges the risks associated with government spending and regulatory changes that could impact its operations. Management remains focused on leveraging its capabilities to navigate these challenges and capitalize on opportunities in the evolving landscape of government contracting.