Science Applications Approves $1.2 Billion Stock Buyback, Raises Annual Outlook After Q3 Beat

Science Applications International Corp (NYSE: SAIC) reported a 4.3% revenue growth year over year in the fiscal third quarter of 2025 to $1.98 billion, beating the analyst consensus estimate of $1.93 billion. Adjusted EPS of $2.61 beat the analyst consensus of $2.16.

The topline growth reflects a ramp-up in volume on existing and new contracts.

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The adjusted operating margin increased by 50 bps to 9.9%. Adjusted EBITDA margin grew by 70 bps to 10.0%.

Science Applications International generated $9 million in free cash flow for the quarter, compared to $97 million a year ago. It generated an operating cash flow of $143 million. As of November 1, 2024, the company held $46 million in cash and equivalents.

Net bookings for the quarter were $1.5 billion, reflecting a book-to-bill ratio of 0.7. The estimated backlog was around $22.4 billion at the end of the quarter. 

Science Applications International’s board of directors declared a cash dividend of $0.37 per share of the company’s common stock.

The board approved a share buyback program of up to $1.2 billion, effective December 16, 2024.

CEO Toni Townes-Whitley said the company expects to exceed $25 billion in submissions this year compared to its target of $22 billion. The company expects its increased submissions to translate into an improving book-to-bill and accelerating growth in fiscal 2026.

Outlook: Science Applications International expects fiscal 2025 revenue of $7.425 billion-$7.475 billion (prior $7.35 billion–$7.50 billion) vs. the consensus of $7.4 billion. The company now expects adjusted EPS guidance of $8.50-$8.65 (prior $8.10-$8.30) versus the consensus of $8.19.

In November, Goldman Sachs gave Science Applications International a sell rating, citing its struggles with slower growth and tougher competition.

Price Action: SAIC stock is up 7.34% at $133 premarket at the last check Thursday.

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