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Segment Information
 6 Months Ended
Jun. 29, 2025
Segment Reporting [Abstract]  
Segment Information Segment Information
 
The Company operates in two reportable segments, KGS and US. The KGS reportable segment is comprised of an aggregation of KGS operating segments, including our microwave electronics products, space, satellite and cyber, training solutions, C5ISR/modular systems, turbine technologies, and defense and rocket support services operating segments. The US reportable segment consists of the Company’s unmanned aerial, unmanned ground, unmanned seaborne and command, control and communications system products. The KGS and US reportable segments provide products, solutions and services for mission critical National Security programs. KGS and US customers primarily include National Security related agencies, the DoD, intelligence agencies and classified agencies, and to a lesser degree, international government agencies and domestic and international commercial customers.

There were not any significant intersegment sales, cost of sales and profit for the three and six month periods ended June 29, 2025 and June 30, 2024.

The Company’s chief operating decision maker is the President and Chief Executive Officer. The chief operating decision maker uses segment operating income (loss) predominantly in the annual budget and forecasting process. The chief operating decision maker considers budget-to-actual variances on a quarterly basis when making decisions about the allocation of operating and capital resources to each segment. The chief operating decision maker also uses segment operating income (loss) to assess the performance of each segment by comparing the results of each segment with one another and in determining the compensation of certain employees.

(a)    Summary Operating Results

The tables below provide information about the Company’s reportable segments. In these tables total segment operating income (loss) of the reportable business segments is reconciled to the corresponding consolidated amount. “Unallocated amounts” includes costs for merger and acquisition expenses, stock-based compensation expenses, interest expense, net, and other income (expense), net, items not considered part of management’s evaluation of segment operating
income. See Note 3 (Revenue Recognition) to these condensed consolidated financial statements for segment revenues disaggregated by contract type, customer and geographic region. The summary operating results for the Company’s reportable segments for the three and six month periods ended June 29, 2025 and June 30, 2024, are as follows (in millions):
Three Months Ended June 29, 2025
Kratos Government Solutions
Unmanned Systems
Totals
Service revenues$133.0 $1.9 $134.9 
Product sales145.3 71.3 216.6 
Total revenues278.3 73.2 351.5 
Cost of service revenue105.4 1.8 107.2 
Cost of product sales110.7 59.8 170.5 
Total cost of sales216.1 61.6 277.7 
Selling, general & administrative expenses40.0 11.3 51.3 
Research & development expenses9.6 0.6 10.2 
Total segment operating income (loss)
12.6 (0.3)12.3 
Reconciliation of segment operating income
Unallocated amounts:
Stock compensation expense$(8.6)
Interest income (expense), net
(1.2)
Other income (expense), net
2.1 
Income before income taxes$4.6 

Revenues from foreign customers were approximately $61.2 million or 17% of total revenue for the three months ended June 29, 2025. Revenues from any one foreign country did not exceed 10% of total revenues.
Six Months Ended June 29, 2025
Kratos Government Solutions
Unmanned Systems
Totals
Service revenues$233.7 $3.6 $237.3 
Product sales284.1 132.7 416.8 
Total revenues517.8 136.3 654.1 
Cost of service revenue179.9 3.0 182.9 
Cost of product sales212.1 111.7 323.8 
Total cost of sales392.0 114.7 506.7 
Selling, general & administrative expenses77.0 22.6 99.6 
Research & development expenses19.2 1.0 20.2 
Total segment operating income29.6 (2.0)27.6 
Reconciliation of segment operating income
Unallocated amounts:
Stock compensation expense$(17.3)
Interest income (expense), net
(2.1)
Other income (expense), net
1.8 
Income before income taxes$10.0 

Revenues from foreign customers were approximately $122.3 million or 19% of total revenue for the six months ended June 29, 2025. Revenues from any one foreign country did not exceed 10% of total revenues.
Three Months Ended June 30, 2024
Kratos Government SolutionsUnmanned SystemsTotals
Service revenues$104.7 $1.8 $106.5 
Product sales109.6 84.0 193.6
Total revenues214.385.8300.1
Cost of service revenue75.7 1.3 77.0 
Cost of product sales77.2 68.7 145.9 
Total cost of sales152.9 70.0 222.9 
Selling, general & administrative expenses37.3 10.6 47.9 
Research & development expenses8.6 1.6 10.2 
Total segment operating income15.5 3.6 19.1 
Reconciliation of segment operating income
Unallocated amounts:
Stock compensation expense$(6.6)
Interest income (expense), net 0.1 
Other income (expense), net
0.1 
Income before income taxes$12.7 

Revenues from foreign customers were approximately $60.0 million or 20% of total revenue for the three months ended June 30, 2024. Revenues from any one foreign country did not exceed 10% of total revenues.
Six Months Ended June 30, 2024
Kratos Government SolutionsUnmanned SystemsTotals
Service revenues$209.3 $3.7 213.0
Product sales222.8 141.5 364.3
Total revenues432.1145.2577.3
Cost of service revenue153.5 2.7 156.2
Cost of product sales157.8 115.1 272.9
Total cost of sales311.3 117.8 429.1
Selling, general & administrative expenses71.7 21.4 93.1 
Research & development expenses17.0 2.8 19.8
Total segment operating income32.1 3.2 35.3 
Reconciliation of segment operating income
Unallocated amounts:
Stock compensation expense$(15.8)
Interest income (expense), net(2.7)
Other income (expense), net
(0.1)
Income before income taxes$16.7 

Revenues from foreign customers were approximately $113.2 million or 20% of total revenue for the six months ended June 30, 2024. Revenues from any one foreign country did not exceed 10% of total revenues.
(b) Capital Expenditures (in millions):
For the Three Months EndedFor the Six Months Ended
June 29, 2025June 30, 2024June 29, 2025June 30, 2024
Kratos Government Solutions$12.6 $5.4 $26.2 $14.9 
Unmanned Systems7.87.116.814.2
Total reportable segment capital expenditures20.4 12.5 43.0 29.1 
Corporate capital expenditures0.10.20.10.2
Total capital expenditures$20.5 $12.7 $43.1 $29.3 
`
(c) Depreciation and Amortization (in millions):
For the Three Months EndedFor the Six Months Ended
June 29, 2025June 30, 2024June 29, 2025June 30, 2024
Kratos Government Solutions$8.2 $6.9 $15.3 $13.0 
Unmanned Systems3.63.56.96.7
Total depreciation and amortization$11.8 $10.4 $22.2 $19.7 
d) Reportable Segment Assets (in millions):
June 29, 2025December 29, 2024
Kratos Government Solutions$1,382.0 $1,250.4 
Unmanned Systems421.0385.7
Total reportable segment assets1,803.0 1,636.1 
Corporate assets(1)
782.7314.8
Total assets$2,585.7 $1,950.9 
(1)Corporate assets primarily include cash and cash equivalents, deferred income tax assets, and property, plant and equipment used in our corporate operations.
Assets of foreign subsidiaries in the KGS segment were $242.6 million and $223.2 million as of June 29, 2025 and December 29, 2024, respectively. Assets from any one foreign country did not exceed 10% of total assets.