What is Leonardo DRS's gross profit margin?

Did Leonardo DRS beat or miss consensus estimates last quarter?

What does Leonardo DRS do and what are its main business segments?

What guidance did Leonardo DRS's management provide for the next earnings period?

What is Leonardo DRS's latest dividend and current dividend yield?

What is the revenue and EPS growth rate for Leonardo DRS year over year?

What were the key takeaways from Leonardo DRS's earnings call?

What were the key takeaways from Leonardo DRS’s earnings call?

**Revenue Growth & Backlog Strength**: 13% organic revenue growth in 2025, with $8.7B backlog supporting 2026 growth. 
- **Investment Payoff**: 40% R&D and 60% CapEx growth in 2025, targeting space, missiles, and unmanned systems. 2026 CapEx to trend at ~5% of revenue.
- **Strategic Wins in Space**: Landmark SDA Tranche 3 program win positions DRS for missile defense growth.
- **2026 Financial Outlook**: 6-8% revenue growth, 70-90bps EBITDA margin expansion, and $1.20-1.26 EPS guidance.
- **European Defense Expansion**: Leonardo partnership to leverage European defense spending and self-reliance trends.

**【CEO Summary Section】**
- **Revenue Growth**: 13% organic revenue growth in 2025, driven by advanced sensing, network computing, and electric power & propulsion. Full-year backlog reached $8.7 billion.
- **Investments**: Increased R&D by 40% and CapEx by over 60%, targeting high-growth markets like space, missiles, and unmanned systems. 2026 CapEx expected to trend at ~5% of revenue.
- **Supply Chain Management**: Resolved germanium supply constraints through recycling, strategic allocations, and long-term agreements. Price volatility mitigation via contract repricing.
- **Strategic Wins**: Secured a landmark position in the SDA Tranche 3 program, advancing space-based missile defense capabilities.
- **Operational Excellence**: Columbia Class program executed on time and quality, contributing to margin stability despite higher R&D and CapEx.

**【CFO Financial Commentary】**
- **2025 Results**: Revenue $3.6 billion (13% growth), Adjusted EBITDA $453 million (13% growth), Free Cash Flow $227 million (19% growth). Diluted EPS up 29%.
- **2026 Guidance**: Revenue $3.85-3.95 billion (6-8% growth), Adjusted EBITDA $505-525 million (70-90bps margin improvement). CapEx ~5% of revenue, free cash flow conversion 80% of adjusted net earnings.
- **Key Drivers**: Operating leverage from Columbia Class, favorable program mix, and reduced R&D margin impact.

**【Q&A Highlights】**
- **Defense Spending**: Encouraged by FY26 defense appropriations and European self-reliance trends. Leonardo partnership to expand international growth.
- **Space & USV Growth**: Charleston facility investments to support naval power systems and USV mission packages. Expecting demand for modular electric propulsion architectures.
- **Quantum Tech Licensing**: Monetized $100M quantum laser IP license, maintaining focus on core defense markets.
- **Profitability Outlook**: 2026 EBITDA margin expansion driven by improved Columbia Class profitability and reduced R&D pressure.
- **Supply Chain Resilience**: Stable germanium supply secured through multi-year agreements and recycling initiatives.

Leonardo DRS, Inc. (DRS) Q4 2025 Earnings Call Transcript

- **Revenue Growth**: Q3 revenue up 18% YoY to $960M, with full year guidance of 10%-11% growth.
- **Counter UAS Dominance**: 20% of revenue from counter UAS, with bookings up 32% sequentially.
- **Leadership Transition**: Bill Lynn retiring; John Baylouny to lead with focus on AI and unmanned systems.
- **Germanium Supply**: Recycling success and strategic agreements to ensure 2026 supply.
- **Free Cash Flow**: $77M in Q3, with 80% conversion of adjusted net earnings.
- **R&D Intensity**: Mid-3% of revenue for R&D, enabling long-term growth in missile sensing and network computing.
- **Columbia Class Expansion**: Shipset margins stabilizing in 2026+ with South Carolina facility.

**【CEO Summary Section】**
- **Strong Q3 Performance**: Bookings of $1.3B (1.4x book-to-bill ratio), total backlog $8.9B (8% YoY), and funded backlog up 20% YoY.
- **Revenue Growth Guidance**: Full year revenue expected to grow 10%-11% YoY, driven by counter UAS and electric power propulsion programs.
- **Leadership Transition**: Bill Lynn retiring as CEO; John Baylouny named new CEO, with Fran Townsend becoming Lead Independent Director.
- **Supply Chain Progress**: Germanium recycling and strategic agreements to ensure 2026 supply, reducing reliance on China.
- **Strategic Investments**: $15M in Hoverfly for unmanned systems, and $1.3B in R&D for AI, SAGEcore OS, and THOR computing solutions.

**【CFO Financial Commentary】**
- **Q3 Financials**: Revenue $960M (18% YoY), Adjusted EBITDA $117M (17% YoY), and Free Cash Flow $77M (up YoY).
- **Segment Growth**: IMS segment revenue up 34% YoY, driven by counter UAS and electric power programs.
- **Guidance Update**: Full year revenue $3.55B-$3.6B, Adjusted EBITDA $437M-$453M, and 80% free cash flow conversion.
- **R&D Intensity**: Mid-3% of revenue for R&D, impacting ASC margins but enabling long-term growth in counter UAS and missile sensing.

**【Q&A Highlights】**
- **Counter UAS Demand**: 20% of revenue tied to counter UAS, with Army bookings up 32% sequentially.
- **Germanium Supply**: Recycling success and strategic agreements to mitigate 2026 risks.
- **Government Shutdown Risks**: Potential delays in awards and payments if shutdown extends beyond November.
- **Foreign Military Sales**: Europe and Asia demand for network computing and propulsion systems.
- **Columbia Class Shipsets**: Stabilizing margins in 2026+ with South Carolina facility expansion.
- **AI and SAGEcore**: Integrating AI into platforms for multi-domain operations, with SAGEcore OS adoption across tactical systems.

Leonardo DRS, Inc. (DRS) Q3 2025 Earnings Call Transcript

- **Revenue Beat**: Q2 revenue up 10% YoY, full-year growth raised to 9-11% on strong bookings and backlog.
- **Profit Margin Expansion**: EBITDA margin 11.6% (70bps YoY), driven by electric power programs.
- **Supply Chain Risk**: Germanium shortages impacting infrared sensors, but 2026 mitigation efforts underway.
- **Strategic Growth**: Naval shipbuilding opportunities ($50M for steam turbines) and Golden Dome initiative set to drive FY26+ orders.
- **Defense Tailwinds**: FY26 DoD funding up 12% YoY; NATO spending surge supports international sales.

**【CEO Summary Section】**
- **Revenue Growth**: Q2 revenue of $829M, up 10% YoY, driven by electric power and propulsion programs. Full-year guidance raised to 9-11% growth.
- **Bookings & Backlog**: Q2 bookings of $853M (1.0 book-to-bill), total backlog $6B (9% YoY). Funded backlog growing double-digit.
- **Strategic Initiatives**: Golden Dome initiative expected to generate orders from FY26, with focus on radar, counter-UAS, and missile defense. Naval shipbuilding opportunities include steam turbine generators for submarines.
- **Supply Chain Challenges**: Germanium shortages impacting infrared sensors; mitigation efforts (recycling, alternative materials) expected to ease in 2026.
- **M&A Strategy**: Actively pursuing deals in core markets, with flexibility on financial criteria for strategic fits.

**【CFO Financial Commentary】**
- **Profitability**: Adjusted EBITDA $96M (17% YoY growth), margin 11.6% (70bps expansion). IMS segment EBITDA up 41%, driven by Columbia class program.
- **Earnings**: Net income $54M, EPS $0.20 (43% YoY). Adjusted EPS $0.23 (28% YoY).
- **Guidance Update**: Full-year revenue $3.525-3.6B, EBITDA $437-453M, EPS $1.06-1.11. Free cash flow conversion target 80%.
- **Key Risks**: Germanium costs and R&D investments (mid-3% of revenue) impacting margins.

**【Q&A Highlights】**
- **Germanium Impact**: Safety stock sufficient for 2025, but 2026 relief needed. Price volatility derisking through contract modifications.
- **Naval Shipbuilding**: $50M in industrial base funding for steam turbine test capacity; potential for second-source contracts.
- **Defense Budget**: FY26 DoD request up 12% YoY; Golden Dome funding ($113B front-loaded) aligns with company capabilities.
- **International Growth**: NATO spending (5% GDP, 3.5% defense) driving demand for counter-UAS and infrared systems.
- **M&A Flexibility**: Open to equity use for strategic deals; focus on ROIC over 3-5 years.


Leonardo DRS (DRS)-30 Jul 25-2025 Q2 Earnings call transcript

- **Revenue Superiority**: 16% YoY growth, $990M bookings, and $8.6B backlog highlight unmatched defense tech demand.
- **Profitability Boost**: IMS segment EBITDA up 38%, driven by Columbia Class milestones and operational efficiency.
- **Resilience Signal**: 13+ quarters of >1.0 book-to-bill despite macro uncertainty.
- **Growth Catalysts**: Shipbuilding expansion, AI processor adoption, and high-density cooling tech adoption.
- **Risk Mitigation**: Proactive germanium supply chain management via economic price adjustment clauses.


**【CEO Summary Section】**
- Q1 revenue grew 16% YoY, driven by material receipts timing and strong demand across defense technologies.
- Bookings reached $990 million (1.2x book-to-bill), pushing backlog to $8.6 billion (up 19% YoY).
- Key growth areas: advanced infrared sensing, electric power & propulsion, tactical radars, and force protection.
- FY25 outlook: maintaining >1.0 book-to-bill target amid DoD funding flexibility.
- Risks: germanium supply chain volatility, but 13+ consecutive quarters of >1.0 book-to-bill demonstrates resilience.

**【CFO Financial Commentary】**
- Q1 revenue: $832 million (16% YoY), exceeding prior guidance due to accelerated material deliveries.
- Adjusted EBITDA: $82 million (+17% YoY), margin 10.3% (up 10bps YoY).
- IMS segment: EBITDA +38% YoY, margin expansion 260bps driven by Columbia Class milestones.
- Free cash flow: Improved YoY due to higher profitability and working capital efficiency.
- FY25 guidance: $3.45-3.525B revenue, $435-455M EBITDA, $1.02-1.08 EPS.

**【Q&A Key Themes】**
- **Supply Chain & Tariffs**: Relative insulation from direct tariff impacts; focused on mitigating germanium price volatility via economic price adjustment clauses.
- **Shipbuilding Growth**: Charleston facility expansion to support Columbia Class submarines; potential for additional Navy investments in steam turbine second-sourcing.
- **AI & Cooling Tech**: AI processor launch for real-time threat detection; growing demand for high-density computing cooling solutions.
- **Margin Outlook**: IMS segment driving margin expansion; ASC segment faces headwinds from germanium costs but improving linearity.
- **M&A Activity**: Maintaining focus on strategic acquisitions despite market noise; active pipeline with several diligences underway.


Leonardo DRS (DRS)-1 May 25-2025 Q1 Earnings call transcript

- **Revenue Growth**: 14% organic growth in 2024, driven by Columbia Class and advanced sensing programs.
- **Profitability**: 23% adjusted EBITDA growth with 90bps margin expansion; 2025 guidance for 30-50bps further improvement.
- **Investment Strategy**: $0.09 dividend and $75M buyback alongside 25% YoY increase in R&D and CapEx.
- **Future Opportunities**: Charleston facility for DDG(X), over-the-horizon radar contracts, and 13% international revenue growth.
- **Risk Management**: 85% fixed-price contracts mitigate administrative shifts; supply chain stability maintained despite [indiscernible] concerns.


**【CEO Summary Section】**
- **Record Performance in 2024**: Achieved 14% organic revenue growth, 23% adjusted EBITDA growth, and a 1.3 book-to-bill ratio. Columbia Class program contributed significantly to margin expansion.
- **Investment in Future Growth**: Increased R&D and CapEx by 25% YoY, with new Charleston facility for electric power and propulsion. Focus on AI, directed energy, and quantum sensing.
- **International Expansion**: International revenue rose to 13% of total, driven by demand for advanced sensing and network computing solutions.
- **Capital Allocation Strategy**: Introduced $0.09 quarterly dividend and $75M share buyback program, alongside M&A focus.

**【CFO Financial Commentary】**
- **Q4 2024 Results**: Revenue $981M (+6% YoY), adjusted EBITDA $148M (+13% YoY), free cash flow $416M. Full year free cash flow $190M (80% of adjusted net earnings).
- **2025 Guidance**: Revenue $3.425B-$3.525B (+6%-9%), adjusted EBITDA $435M-$455M, EPS $1.02-$1.08. Margin expansion driven by Columbia Class and program mix improvements.
- **Financial Health**: Net cash position at start of 2025, with 4% of revenue allocated to CapEx for Charleston facility.

**【Q&A Key Highlights】**
- **Impact of New Administration**: Focus on missile defense, Indo-Pacific strategy, and fixed-price contracts aligns with DRS's 85% fixed-price portfolio. No immediate impact from Executive Orders.
- **Supply Chain Risks**: [Indiscernible] supply concerns mitigated by safety stock; overall supply chain stability maintained.
- **Long-Term Growth Drivers**: Charleston facility expansion for DDG(X) and submarine industrial base; over-the-horizon radar contracts and AI-driven solutions.
- **Margin Outlook**: 2026 target of 14% EBITDA margin achievable through Columbia Class efficiency and smaller program transitions to production.


Actual	0.08	0.35	0.07	0.15	0.2	0.31	0.14	0.18	0.24	0.38	0.2	0.23	0.29	0.42
Forecast	0.0867	0.3191	0.0544	0.1097	0.1553	0.2967	0.1163	0.1382	0.1945	0.3531	0.1651	0.2144	0.2784	0.3685
Surprise	-7.73%	+9.68%	+28.68%	+36.74%	+28.78%	+4.48%	+20.38%	+30.25%	+23.39%	+7.62%	+21.14%	+7.28%	+4.17%	+13.98%

DRS

DRS fundamentals

DRS Q4 2025 Earnings

Earnings Call

You can ask Aime

DRS

DRS fundamentals

DRS Q4 2025 Earnings

Earnings Call

DRS Earnings Call Summary for Q4/202510:00 AM on Feb 24, 2026

DRS Earnings Call Summary for Q3/20259:30 AM on Oct 29, 2025

DRS Earnings Call Summary for Q2/202510:00 AM on Jul 30, 2025

DRS Earnings Call Summary for Q1/202510:00 AM on May 1, 2025

DRS Earnings Call Summary for Q4/202410:00 AM on Feb 20, 2025

You can ask Aime