Karman Holdings Shares Plunge 21.19% to 2025 Low on Earnings Miss, Operational Inefficiencies

The share price fell to its lowest level since September 2025 today, with an intraday decline of 21.19%.

Karman Holdings (NASDAQ: KRMN) reported a 5.96% post-earnings drop on November 6, 2025, following a 16.67% earnings-per-share shortfall despite 42% year-over-year revenue growth. Operational inefficiencies and higher-than-expected costs undermined investor confidence, even as gross profit surged 48% to $50 million and net income rose 78% to $8 million. The stock’s 857.4 P/E ratio, reflecting aggressive growth expectations, amplified the negative reaction to the earnings miss.

Strategic tailwinds from the One Big Beautiful Bill Act (OBBBA), allocating $150 billion for defense programs, position Karman to benefit from expanded demand in missile defense, hypersonics, and space launch systems. The company raised full-year 2025 revenue guidance to $461–$463 million and acquired Five Axis Industries to bolster its space capabilities. However, margin pressures—evidenced by a 31.0% adjusted EBITDA margin in Q3 2025, down from 32.6% in Q3 2024—and a $130 million term loan to fund growth have raised concerns about debt sustainability. Analysts remain divided, with RBC Capital raising its price target to $93 while others question whether the stock’s valuation aligns with its earnings trajectory.

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