Karman (KRMN) Q3 2025 earnings summary

Executive summary

• Achieved record quarterly revenue of $122 million (up 42% YoY), net income of $7.6 million (up 78% YoY), and significant growth in gross profit, adjusted EBITDA, and EPS, driven by organic growth and acquisitions.

• Funded backlog reached a record $758 million, providing strong visibility for future revenue.

• Completed a $1.2 billion non-dilutive secondary equity offering and acquired Five Axis Industries to expand commercial space capabilities.

• Raised full-year 2025 guidance for both revenue and Adjusted EBITDA, reflecting robust demand and expanded capabilities.

• Completed IPO in February 2025, raising $147.3 million in net proceeds, and executed multiple strategic acquisitions (MTI, ISP, RMS) to expand market reach.

Financial highlights

• Q3 revenue: $121.8 million, up 41.7%–42% YoY; gross profit: $49.9–$50 million, up 48%; gross margin: 41%.

• Net income: $7.6 million, up 78% YoY; net income margin: 6.3%.

• Adjusted EBITDA: $37.7–$38 million, up 34% YoY; margin: 31.0%.

• Adjusted EPS: $0.10 per diluted share, more than double from $0.04.

• Total assets increased to $968 million as of September 30, 2025.

Outlook and guidance

• Full-year 2025 revenue guidance raised to $461–$463 million, with adjusted EBITDA of $142–$143 million, both up 34% YoY at midpoints.

• Preliminary 2026 revenue growth expected at 20–25% above 2025 midpoint, exclusive of future acquisitions.

• 100% revenue visibility for 2025 based on nine-month results and funded backlog.

• Expects 50 basis points of EBITDA margin expansion per year from operating leverage.