Kratos Defense & Security Solutions(NASDAQ) KTOS

Kratos makes high-tech hardware and software used for national security and defense. The company builds robotic aircraft, satellite tools, and rocket engines for government and commercial customers. These products help protect countries and keep satellite communications running smoothly.

High-Tech Defense Tools

• Unmanned Systems: High-performance jet drones for target practice and tactical missions; includes aerial, ground, and seaborne robotic vehicles.
• Space and Satellite: Software and ground systems that control satellites and track signals to prevent interference.
• Microwave Electronics: Internal components for missiles, radars, and air defense systems that help them communicate and find targets.
• Turbine Technologies: Small jet engines and propulsion systems designed for drones, missiles, and hypersonic vehicles.
• C5ISR and Training: Modular systems for combat electronics and virtual reality simulators used to train military personnel.

Recent Growth and Partnerships

• Formalized a teaming agreement with GE Aerospace in June 2025 to develop and mass-produce small jet engines for drones.
• Won the Mach TB 2.0 contract in 2025, a five-year deal valued at $1.45 billion to create affordable hypersonic test beds.
• Successfully flew the Zeus 1 and Zeus 2 solid rocket motors for the first time in October 2024.
• Launched the Erinyes hypersonic flight system in June 2024 to collect data during high-speed test missions.
• Introduced the OpenSpace platform, the first fully virtualized ground system for satellite communications, to the commercial market.

What Makes Kratos Different

Kratos focuses on "affordability as a technology," using proven designs to build and field equipment faster than traditional contractors. The company uses its own money to develop products like the Valkyrie drone, allowing it to own the designs and move quickly to meet urgent military needs.

A Look at the Numbers

• Revenue reached $345.1 million in Q4 2025, up 21.9% from Q4 2024.
• Net income rose to $5.9 million in Q4 2025, a 51.3% increase year-over-year.
• Operating income jumped to $10.3 million in Q4 2025, up 243.3% from the previous year.
• Total backlog grew to $1.57 billion by December 28, 2025, compared to $1.45 billion at the end of 2024.
• Operating cash flow was $12.1 million in Q4 2025, down 73.5% from the $45.6 million reported in Q4 2024.

The Bottom Line

Kratos has transformed from a services provider into a technology company that owns its own product designs and manufacturing plants. By focusing on low-cost, rapidly produced drones and engines, it has positioned itself as a nimble alternative to larger defense firms.