KBR Reaffirms Fiscal 2026 Outlook After Third-Quarter Profit

The Tip Desk · November 1, 2026 · 3 min read

Revenue reached $2.0 billion and net income attributable to KBR was $133 million as Sustainable Technology Solutions converted bookings into 26% growth.

KBR, Inc. (KBR) reported third-quarter fiscal 2026 revenue of $2.0 billion, up 5% from a year earlier, a sequential acceleration from the 2% year-over-year increase in the second quarter.

The global lifecycle solutions company said the lift came primarily from engineering and professional services in Sustainable Technology Solutions, partially offset by anticipated reductions in NASA programs within Mission Technology Solutions. Net income attributable to KBR was $133 million, up 16%. Diluted earnings were $1.06 a share, up 18%, and adjusted earnings were $1.12 a share, up 10%.

Operating income was $186 million, down 3%, with an operating margin of 9.2%. The company said higher gross profit from increased revenue was more than offset by higher spin-off costs tied to the planned separation, higher selling, general and administrative expenses, and lower equity in earnings from unconsolidated joint ventures. Adjusted EBITDA was $268 million, up 12%, with a 13.2% margin. The company attributed the adjusted EBITDA increase to execution across both segments, joint-venture contributions, favorable portfolio mix, and lower corporate costs.

Sustainable Technology Solutions revenue was $762 million, up 26%. The company said the increase reflected conversion of bookings secured over prior quarters. Segment adjusted EBITDA was $147 million, up 15%, with a 19.3% margin. Operating income in the segment was $124 million, up 4%. Backlog reached a record $5.8 billion, and book-to-bill was 1.3x.

Mission Technology Solutions revenue was $1.3 billion, down 5%, on lower U.S. Government Federal Civilian volumes associated with anticipated NASA headwinds, partially offset by growth in Defense & Intelligence and International Government customers. Segment adjusted EBITDA was $145 million, up 5%, with an 11.5% margin. Operating income was $115 million, up 2%. Backlog and options totaled $17.3 billion, and book-to-bill was 0.6x, or 0.8x excluding the NASA insourcing debooking.

Consolidated bookings and options were $2.4 billion, with 0.9x book-to-bill, down from 1.1x in the second quarter. Excluding the NASA insourcing debooking, book-to-bill was 1.0x. Backlog and options as of quarter-end totaled $23.1 billion. Among MTS awards, the company said it was re-awarded the $8 billion ceiling Antarctic Science and Engineering Support Contract, which is not yet in backlog or book-to-bill, and a $208 million U.S. Army TAGM task order.

Operating cash flows from continuing operations were $171 million, down 14%. Adjusted operating cash flows were $188 million, down 5%. Liquidity as of October 2, 2026, totaled about $1.1 billion, including $625 million of revolving capacity and $439 million in cash. Net leverage was 2.1x. The company returned $21 million in dividends and made no common-stock repurchases in the quarter.

KBR reaffirmed fiscal 2026 guidance of revenues of $7.90 billion to $8.36 billion, adjusted EBITDA of $980 million to $1.04 billion, adjusted EPS of $3.87 to $4.22, and adjusted operating cash flows of $560 million to $600 million.

The planned spin-off of Mission Technology Solutions as Trinzic remains targeted for January 4, 2027, subject to board approval and other conditions, including effectiveness of the Form 10 filed September 30, 2026. KBR and Trinzic Investor Days are scheduled for November 11 and 12, 2026, in New York.