CACI’s second quarter results were met with a significant positive market response, driven by strong growth across its technology-focused defense and intelligence businesses. Management credited operational execution in electronic warfare and space, as well as expanding demand for software-based solutions, for the outperformance. CEO John Mengucci highlighted the strategic impact of investments in new product development and the rapid deployment of counter-unmanned aerial systems (C-UAS), stating, “We invested ahead of need in SkyValor, moving from concept to deployment in 12 months, and are seeing strong demand and expanding backlog.”
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CACI (CACI) Q2 CY2026 Highlights:
- Revenue: $2.71 billion vs analyst estimates of $2.69 billion (17.6% year-on-year growth, 0.7% beat)
- Adjusted EPS: $8.91 vs analyst estimates of $7.23 (23.2% beat)
- Adjusted EBITDA: $353.1 million vs analyst estimates of $318.2 million (13% margin, 11% beat)
- Adjusted EPS guidance for the upcoming financial year 2027 is $33.41 at the midpoint, beating analyst estimates by 8.4%
- Operating Margin: 10%, up from 9% in the same quarter last year
- Backlog: $32 billion at quarter end, up 3.2% year on year
- Market Capitalization: $14.75 billion
While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From CACI’s Q2 Earnings Call
- Gavin Parsons (UBS) asked what enabled CACI’s recent acceleration in organic growth. CEO John Mengucci cited a long-term strategic shift toward software-based technology, investment in embedded mission teams, and the development of commercially deliverable defense solutions.
- Scott Mikus (Melius Research) questioned whether new executive hires signal a shift to more hardware-intensive operations. Mengucci responded that while expertise remains a core competency, the company is focused on integrating software-defined hardware and support to meet evolving defense needs.
- Colin Canfield (Cantor Fitzgerald) inquired about the outlook for funded backlog and impact of nontraditional awards. CFO Jeffrey MacLauchlan explained that growth in funded backlog and the use of OTAs are key indicators of enduring customer demand, even as award timing evolves.
- Peter Arment (Baird) asked if the recent increase in fixed-price contracts is sustainable. Mengucci noted that fixed-price work aligns with CACI’s agile development model and is expected to remain a significant part of the business, supporting margin gains.
- Gautam Khanna (TD Cowen) sought clarity on contract award expectations given the large pipeline. Management pointed to longer contract durations, a robust new business pipeline, and evolving customer procurement behaviors as supporting ongoing growth.
Catalysts in Upcoming Quarters
In coming quarters, our team will be monitoring (1) the pace of electronic warfare and space program deployments, particularly the scaling of Spectral and SkyValor; (2) the success of digital modernization initiatives in securing additional federal contracts; and (3) the translation of AI-driven operational improvements into higher margins and free cash flow. We will also watch for progress in integrating recent acquisitions and the evolution of procurement dynamics that may influence the timing and mix of contract awards.
CACI currently trades at $666.53, up from $518.03 just before the earnings. Is there an opportunity in the stock? See for yourself in our full research report (it’s free).
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