Question · Q2 2026
Steve Zochowski with RBC Capital Markets asked about the margin profile of the Space, Cyber, and Directed Energy (SCD&E) segment, specifically when adjusted EBIT might reach break-even, and sought the free cash flow outlook for the second half and full fiscal year.
Answer
Chairman, President, and CEO Wahid Nawabi and Executive Vice President and CFO Kevin McDonnell stated that the SCD&E segment was heavily impacted by the government shutdown and revenue recognition delays but is expected to improve in Q3 and Q4, with increased product mix driving EBITDA margins up. Kevin McDonnell reiterated the goal of achieving over 50% EBITDA cash conversion for the full year.
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