Segment Information (Tables)

9 Months Ended

Sep. 28, 2025

Schedule of Segment Revenues, Depreciation and Amortization, and Operating Income

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 nine month periods ended September 28, 2025 and September 29, 2024, are as follows (in millions):


Three Months Ended September 28, 2025	Kratos Government Solutions		Unmanned Systems		Totals
Service revenues	$	114.7	$	2.7	$	117.4
Product sales	145.7		84.5		230.2
Total revenues	260.4		87.2		347.6
Cost of service revenue	89.1		2.1		91.2
Cost of product sales	109.0		70.3		179.3
Total cost of sales	198.1		72.4		270.5

Selling, general & administrative expenses	39.2		11.5		50.7
Research & development expenses	9.4		0.6		10.0
Total segment operating income (loss)	13.7		2.7		16.4
Reconciliation of segment operating income
Unallocated amounts:
Merger and acquisition related expenses					$	(0.2)
Stock compensation expense					(9.1)
Interest income (expense), net					4.6
Other income (expense), net					0.2
Income before income taxes					$	11.9

Revenues from foreign customers were approximately $59.7 million or 17% of total revenue for the three months ended September 28, 2025. Revenues from any one foreign country did not exceed 10% of total revenues.


Nine Months Ended September 28, 2025	Kratos Government Solutions		Unmanned Systems		Totals
Service revenues	$	348.4	$	6.3	$	354.7
Product sales	429.8		217.2		647.0
Total revenues	778.2		223.5		1,001.7
Cost of service revenue	269.0		5.1		274.1
Cost of product sales	321.1		182.0		503.1
Total cost of sales	590.1		187.1		777.2

Selling, general & administrative expenses	116.2		34.1		150.3
Research & development expenses	28.6		1.6		30.2
Total segment operating income	43.3		0.7		44.0
Reconciliation of segment operating income
Unallocated amounts:
Merger and acquisition related expenses					$	(0.2)
Stock compensation expense					(26.4)
Interest income (expense), net					2.5
Other income (expense), net					2.0
Income before income taxes					$	21.9

Revenues from foreign customers were approximately $182.0 million or 18% of total revenue for the nine months ended September 28, 2025. Revenues from any one foreign country did not exceed 10% of total revenues.


Three Months Ended September 29, 2024	Kratos Government Solutions		Unmanned Systems		Totals
Service revenues	$	102.0	$	1.9	$	103.9
Product sales	109.7		62.3		172.0
Total revenues	211.7		64.2		275.9
Cost of service revenue	75.3		1.4		76.7
Cost of product sales	78.5		51.5		130.0
Total cost of sales	153.8		52.9		206.7

Selling, general & administrative expenses	35.2		10.2		45.4
Research & development expenses	9.2		0.7		9.9
Total segment operating income	13.5		0.4		13.9
Reconciliation of segment operating income
Unallocated amounts:
Merger and acquisition related expenses					$	(0.2)
Stock compensation expense					(7.2)
Interest income (expense), net					—
Other income (expense), net					(0.7)
Income before income taxes					$	5.8

Revenues from foreign customers were approximately $58.6 million or 21% of total revenue for the three months ended September 29, 2024. Revenues from any one foreign country did not exceed 10% of total revenues.


Nine Months Ended September 29, 2024	Kratos Government Solutions		Unmanned Systems		Totals
Service revenues	$	311.3	$	5.6	316.9
Product sales	332.5		203.8		536.3
Total revenues	643.8		209.4		853.2
Cost of service revenue	228.8		4.1		232.9
Cost of product sales	236.3		166.6		402.9
Total cost of sales	465.1		170.7		635.8

Selling, general & administrative expenses	106.9		31.6		138.5
Research & development expenses	26.2		3.5		29.7
Total segment operating income	45.6		3.6		49.2
Reconciliation of segment operating income
Unallocated amounts:
Merger and acquisition related expenses					$	(0.2)
Stock compensation expense					(23.0)
Interest income (expense), net					(2.7)
Other income (expense), net					(0.8)
Income before income taxes					$	22.5

Revenues from foreign customers were approximately $171.8 million or 20% of total revenue for the nine months ended September 29, 2024. Revenues from any one foreign country did not exceed 10% of total revenues.


(b) Capital Expenditures (in millions):	Three Months Ended				Nine Months Ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024
Kratos Government Solutions	$	18.5	$	8.6	$	44.7	$	23.5
Unmanned Systems	9.6		6.5		26.4		20.7
Total reportable segment capital expenditures	28.1		15.1		71.1		44.2
Corporate capital expenditures	0.0		0.2		0.0		0.4
Total capital expenditures	$	28.1	$	15.3	$	71.1	$	44.6


(c) Depreciation and Amortization (in millions):	Three Months Ended				Nine Months Ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024
Kratos Government Solutions	$	8.4	$	7.1	$	23.7	$	20.1
Unmanned Systems	3.5		3.2		10.4		9.9
Total depreciation and amortization	$	11.9	$	10.3	$	34.1	$	30.0


d) Reportable Segment Assets (in millions):	September 28, 2025		December 29, 2024
Kratos Government Solutions	$	1,415.5	$	1,250.4
Unmanned Systems	434.3		385.7
Total reportable segment assets	1,849.8		1,636.1

Corporate assets(1)	573.5		314.8
Total assets	$	2,423.3	$	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.