Amentum's $4B Space Force Contract: A Strategic Catalyst for Defense and Space Sector Growth

The U.S. space infrastructure modernization wave is accelerating, driven by a confluence of national security imperatives, commercial innovation, and technological breakthroughs. At the forefront of this transformation is Amentum Holdings LLC (AMTM), which has secured a landmark $4 billion, 10-year contract with the U.S. Space Force to modernize critical launch ranges. This agreement, awarded in June 2025, underscores Amentum's strategic positioning as a linchpin in the race to establish resilient, multi-user spaceports capable of meeting surging demand from government, commercial, and international clients.

Amentum's Role in the Space Force's Vision

The Space Force Range Contract (SFRC) is more than a procurement—it is a foundational step in the U.S. military's effort to future-proof its access to space. Amentum's scope includes systems engineering, cybersecurity, logistics, and digital transformation of the Launch and Test Range System (LTRS) across key facilities like Patrick Space Force Base, Cape Canaveral, and Vandenberg. By consolidating operations and enhancing range resilience, Amentum is enabling the Space Force to transition from traditional launch sites to next-generation spaceports that support high-frequency, multi-mission operations.

This aligns with the Assured Access to Space (AATS) initiative, a cornerstone of the Space Systems Command's strategy to ensure uninterrupted access to space for national security and exploration. Amentum's expertise in managing complex infrastructure—evidenced by its prior work on NASA's Stennis Space Center and Michoud Assembly Facility—positions it to deliver the scalability and adaptability required for a rapidly evolving space ecosystem.

Strategic Alignment with Broader Trends

The SFRC is part of a larger $1.5 trillion global space economy, with the U.S. commercial sector alone projected to grow to $1.1 trillion by 2030. Amentum's contract taps into three critical trends:
1. Defense Spending Surge: The DoD's 2025 budget allocates $849.8 billion, with $1.5 billion earmarked for solid rocket motor development and space capabilities. Amentum's work on unconventional fuels and missile defense systems (e.g., IRES contract) complements this focus.
2. Commercial Space Expansion: With over 100 private companies now active in the U.S. space sector, demand for shared infrastructure is soaring. Amentum's multi-user spaceport model reduces costs and accelerates launch timelines, making it a critical enabler for firms like SpaceX, Blue Origin, and Rocket Lab.
3. Digital Transformation: Amentum's integration of AI-driven asset management and digital twins into range operations mirrors the broader industry's shift toward smart infrastructure. This not only improves efficiency but also aligns with the Space Force's Principles for Space Access Resourcing, which prioritize agility and cost-effectiveness.

Financial Strength and Investment Case

Amentum's Q3 2025 results highlight its operational resilience: adjusted diluted EPS of $0.56 (up 80.65% from forecasts) and $3.6 billion in revenue, with a 2% year-over-year increase. The company's $45 billion backlog—3.2x annual revenue—and disciplined leverage reduction (3.5x net debt/EBITDA) further strengthen its balance sheet. While its stock dipped 1.22% pre-market following the Q3 report, this appears to reflect broader market volatility rather than company-specific risks.

The SFRC, though currently under protest, represents a transformative opportunity. If finalized, it would expand Amentum's revenue base by ~28% annually over the next decade, with margins bolstered by its expertise in high-margin engineering and cybersecurity services. Analysts have noted that Amentum's nuclear and space segments—responsible for 70% of its $700 million annual nuclear revenue—are particularly well-positioned to benefit from the Trump administration's AI Action Plan and infrastructure modernization efforts.

Why This Is a Near-Term Opportunity

Amentum's SFRC win is a bellwether for the defense-adjacent space tech sector. The company's dual focus on national security (e.g., SHIELD missile defense initiatives) and commercial infrastructure (e.g., NASA's Artemis program) creates a diversified revenue stream insulated from sector-specific downturns. Additionally, its workforce development programs—such as the New Gen initiative—ensure a pipeline of skilled talent to sustain growth.

For investors, Amentum offers a rare combination of high-margin contracts, government-backed demand, and exposure to the multi-trillion-dollar space economy. While its P/E ratio of 215x may seem elevated, this reflects the market's recognition of its long-term growth potential. With the SFRC transition activities already underway and the Space Force's 2025-2035 modernization roadmap in place, Amentum is poised to outperform peers in a sector expected to grow at a 12% CAGR through 2030.

Conclusion

Amentum's $4 billion SFRC is not just a contract—it is a strategic inflection point for the company and the broader space sector. By leveraging its deep institutional knowledge, digital capabilities, and alignment with U.S. defense and commercial priorities, Amentum is uniquely positioned to capitalize on the accelerating modernization of space infrastructure. For investors seeking exposure to a high-growth, mission-critical industry, Amentum represents a compelling near-term opportunity.