Mercury Systems Inc. shares jumped more than 10% on Tuesday after the defense electronics company reported quarterly earnings that exceeded market expectations and raised its full-year guidance.
The company posted adjusted earnings per share of $1.25 for the quarter ended June 30, compared with the $1.12 forecast by analysts polled by Refinitiv. Revenue totaled $245 million, ahead of the $238 million estimate.
Mercury Systems also raised its fiscal 2025 revenue guidance to a range of $1.02 billion to $1.04 billion, up from its prior forecast of $980 million to $1.01 billion. Adjusted earnings per share guidance was increased to $5.00-$5.20 from $4.80-$5.00.
Analysts attributed the outperformance to sustained demand for the company’s aerospace and defense electronics, including radar and communication systems used in military and commercial applications. The defense sector has benefited from increased government spending amid geopolitical tensions.
Mercury Systems’ stock, which had underperformed the broader market in recent months, extended gains following the results, trading at $112.45 in midday deals, up 10.8%. The S&P 500 defense index rose 1.2% during the same period.
The company’s order backlog stood at $1.8 billion, providing visibility into future revenue streams, management noted in a statement.
