Booz Allen Hamilton Q4 Revenue Falls Short of Estimates, Shares Decline

Booz Allen Hamilton's shares fell after Q4 revenue and 2026 outlook missed estimates. The company's management and technology consulting services firm reported a decline in revenue, which led to a downgrade by Raymond James. Booz Allen Hamilton provides services to the U.S. and international governments, including artificial intelligence, cloud, and digital solutions.

Booz Allen Hamilton Holding Corp. (BAH) experienced a significant drop in its stock price on Friday, following the release of its fiscal 2026 outlook and Q4 earnings report. The company's shares fell more than 12% in premarket trading, with the stock entering the day roughly flat since the start of the year [1].

The consulting firm and government contractor reported adjusted earnings per share (EPS) of $1.61 for the fourth quarter, matching analysts' estimates but below the $1.61 and $3.03 billion in revenue that analysts had projected [2]. The company's fiscal 2026 revenue guidance, which ranged between $12 billion and $12.5 billion, also missed expectations of $12.82 billion. The adjusted EPS for the fiscal year was projected to be between $6.20 and $6.55, falling short of the $6.88 a share that analysts had anticipated [1].

The company's CEO, Horacio Rozanski, attributed the underperformance to the Trump administration's focus on cost-cutting, which has impacted its contracts with civilian agencies. Booz Allen Hamilton announced plans to "restructure and reset" its civil business, including cost reductions and layoffs to match anticipated demand. The company expects to cut about 7% of its staff in the first quarter, primarily in its civil business segment [1].

Booz Allen Hamilton provides a range of services to both U.S. and international governments, including artificial intelligence, cloud, and digital solutions. The company's reliance on government contracts makes it particularly vulnerable to changes in federal spending priorities. The recent guidance and earnings report suggest that the company is facing headwinds in its civil business segment, which may require significant restructuring to align with anticipated demand [1].

Raymond James downgraded its rating on Booz Allen Hamilton to "Underweight" following the earnings report, citing concerns about the company's guidance and the impact of federal cost-cutting efforts on its contracts. The stock's decline reflects investor concerns about the company's ability to navigate the current economic environment and maintain its growth trajectory [1].

References:

[1] https://finance.yahoo.com/news/booz-allen-hamilton-stock-plummets-125800939.html
[2] https://www.morningstar.com/news/dow-jones/202505233699/booz-allen-hamilton-4q-revenue-fy26-guidance-disappoint