Record Quarterly Revenue and Growth
Q1 revenue of $151.0M, up 51% year-over-year; raised full-year 2026 revenue guidance to $720M–$735M (implies ~54% YoY growth at midpoint).
Karman Holdings Inc.
· KRMN
May 12th, 2026
Summary
- Earnings Call Date:
- 2026-05-12
- Change Since:
- -28.23%
- Next Earnings Date:
- 2026-08-06
Earnings Call Sentiment
PositiveThe call conveys a strongly positive operational and financial trajectory: record revenue, profits, backlog and raised guidance underscore robust demand across all end markets, with meaningful customer commitments and capacity expansion underway. Risks include a sizable absolute debt load, reliance on contingent commitments and inorganic growth for part of the upside, and the usual timing uncertainty around defense appropriations and contract awards. Overall, positives (record results, backlog, raised guidance, multi‑year customer commitments, capacity investments) materially outweigh the outlined risks.
Company Guidance
Karman raised its 2026 guidance to full‑year revenue of $720–$735 million and non‑GAAP adjusted EBITDA of $208.5–$219.5 million (implying a ~29.4% adjusted EBITDA margin at the midpoint), which management says represents roughly 54% year‑over‑year revenue growth and 47% adjusted EBITDA growth; Q1 results (revenue $151M, adjusted EBITDA $45M, backlog >$1B up 61% YoY) provide about 90% visibility to the midpoint with the remaining ~10% expected from anticipated contracts. The company expects CapEx of ~5% of revenue (~$36M), a statutory tax rate of ~26.5%, D&A and interest to increase modestly post‑acquisitions, and leverage to decline to ~3x adjusted EBITDA by year‑end 2026 from total debt of $758M (at SOFR +275 bps); cash was $74M and the untapped revolver was increased to $150M. Revenue growth for the year is expected to be roughly evenly split between organic and inorganic sources, and management noted contingent multi‑year customer commitments (4–7 years) that could ultimately yield >$1 billion of revenue when fully realized.
Strong Profitability and Margins
Record gross profit of $64.0M (up 62% YoY) with gross margin of 42%; adjusted EBITDA of $45.0M (up nearly 50% YoY); adjusted EPS of $0.11 vs $0.05 prior year (>100% growth).
Backlog and Visibility
All-time high backlog >$1.0B (up 61% YoY); Q1 results plus backlog provide ~90% visibility to the midpoint of full-year revenue guidance.
End-Market Revenue Strength
Year-over-year growth across all legacy end markets: Space & Launch revenue +29% to $44M; Hypersonics & Strategic Missile Defense +19% to $36M; Tactical Missiles & Integrated Defense Systems +25% to $45.09M; newly reported Maritime Defense Systems contributed $26M.
Customer Commitments and Program Momentum
Received written contingent demand commitments from 4 large customers covering multi-year production (4–7 year horizons) that could yield >$1B of revenue when fully realized; strong contracting momentum following Artemis II success and Artemis program restructuring.
Balance Sheet and Liquidity Improvements
Cash and cash equivalents of $74M (up $40M from year-end 2025); untapped revolving credit facility increased from $50M to $150M to provide additional liquidity and flexibility.
Capacity Expansion and Technology Investments
CapEx of $7M in Q1 (supporting nozzle capacity, UAS launchers, launch vehicles, spacecraft manufacturing); new Salt Lake City facility (~200k sq ft) on track for initial production capability in Q4; Gulfport logistics/polymer facility and targeted AI deployments underway.
M&A Contribution and Integration Progress
Seemann Composites and MSC acquisitions closed in January contributed two months of revenue in Q1 and accounted for roughly half of the YoY quarterly revenue growth; integration progressing with cross-company synergies in advanced materials and manufacturing capabilities.
Operator
Hello, everyone. Thank you for joining us, and welcome to the Karman Space and Defense First Quarter Fiscal Year 26 Earnings Conference Call. After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question, please press *1 to raise your hand. To withdraw your question, press *1 again. I will now hand the conference over to Steven A. Gitlin, Senior Vice President of Investor Relations and Corporate Communications. Steven, please go ahead.
Steven A. Gitlin
Good afternoon, thank you for joining Karman Space and Defense's first quarter fiscal 26 earnings conference call. I am Steven A. Gitlin, Senior Vice President of investor relations and corporate communications. I am pleased to welcome you today. Joining me on today's call are Jonathan Rambeau, our chief executive officer; Mike Willis, our chief financial officer; Jonathan Beaudoin, our chief operating officer. Before we begin, please note that on this call, information presented contains forward looking statements that are based on current expectations, forecasts, and assumptions that involve risks and uncertainties. These are described on page 2 of the earnings presentation we posted to our website this afternoon, and in detail in Karman's reports filed with the SEC and the Form 8-K filed today with the SEC. I would also like to note that we will discuss a number of non GAAP financial measures today, that we believe can be useful in evaluating our performance.
Such non GAAP financial measures should not be considered in isolation or as a substitute for results prepared in accordance with GAA...
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