Kratos Defense (NASDAQ: KTOS) reported Q2 EPS of $0.08, $0.02 better than the analyst estimate of $0.06. Revenue for the quarter came in at $170.4 million versus the consensus estimate of $165.18 million.

Eric DeMarco, Kratos’ President and CEO, said, “Kratos remains well positioned for the ongoing recapitalization of strategic weapon systems to address peer threats to the U.S. and our allies as reflected in our second quarter report, including our 1.2 to 1.0 book to bill ratio and $8 billion opportunity pipeline. In KGS, our C5ISR, microwave electronics and rocket system businesses performed particularly well, including in the missile system, radar, missile defense and weapon systems areas.” Mr. DeMarco continued, “Since our last report to you, Kratos’ unmanned systems business continued to make significant progress, including the receipt of a $400 million Skyborg IDIQ contract award and solid execution on our Valkyrie, Gremlins, Airwolf, Thanatos and Rattle Snake programs. Additionally, we believe the addressable market for Kratos’ class of drone systems is continuing to expand, including the Skyborg, LCAAT, LCASD, Golden Horde, ABMS, ACE and other programs.”

Mr. DeMarco concluded, “At Kratos, affordability is a technology, and we are laser focused on being the alternative, low cost rapid developer and fielder of leading technology systems to the U.S. Military, our allies and other customers. Our strategy is to lever our venture capital, commercial and entrepreneurial based research, development and production practices to disrupt our market focus areas and deliver real innovation and cost effectiveness to our customers.”

GUIDANCE:

Kratos Defense sees Q3 2020 revenue of $195-205 million, versus the consensus of $197.35 million.

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