Mercury Systems

Table of Contents

⚠ Disclaimer: This entry may be incomplete, out of date, or inaccurate. It is AI-maintained on a best-effort basis. Do not rely on it as a sole source — verify claims independently using the sources listed below.

Summary

Mercury Systems (NASDAQ: MRCY, Andover, Massachusetts) turns commercial silicon into rugged processing subsystems for defense platforms and sells them largely through prime contractors: RTX, Lockheed Martin and Northrop Grumman together were 36% of fiscal 2026 revenue, and about 97% of revenue came from US and foreign governments, mostly via primes. FY2026 (ended 2026-07-03) revenue was $984M, up from $912M, with record bookings of $1.5B and record backlog above $1.9B. The company reports record bookings for its Common Processing Architecture (CPA) products and, in August 2026, announced an AI software agreement with Palantir for factory planning. Its 10-K describes it as holding “the sole source for many unique capabilities,” while it says it is a member of the SOSA initiative.

Key Facts

HQ: 50 Minuteman Road, Andover, MA (10-K)
Ticker: NASDAQ: MRCY
Value chain position: component and subsystem supplier to defense primes (module tier and rack/server tier)
FY2026 (ended 2026-07-03): revenue $984M (FY2025: $912M); bookings $1.5B (book-to-bill 1.57); GAAP net loss $30M; adjusted EBITDA $150M (15.3% margin); free cash flow $68M (FY2025: $119M)
Q4 FY2026: revenue about $290M (+6.1%); bookings $660M (+93.1%); book-to-bill 2.28
Backlog: above $1.9B at 2026-07-03 (+38.4%); about $1.0B expected to convert within 12 months
FY2027 outlook (company): revenue approaching $1.1B; adjusted EBITDA near $200M; free-cash-flow conversion near 35%
Customers (FY2026): RTX 15%, Lockheed Martin 11%, Northrop Grumman 10%; no single program 10% or more of revenue; domestic sales about 85.8% of revenue
Employees: 2,102 at 2026-07-03, excluding contractors
CEO: Bill Ballhaus, Chairman and CEO; extension announced 2026-09-16 through 2030-08-15
CFO: David Farnsworth
Acquisition: Themis Computer, completed 2018-02-01 for $180M cash (adds C4I rugged servers)
Standards: OpenVPX; the 10-K says Mercury is a SOSA member

What It Is / How It Works

Mercury does not design GPUs or FPGAs. It integrates commercial processors, FPGAs and memory into modules and chassis that survive military environments, then sells them as building blocks that primes integrate into radar, electronic warfare, mission-computer and space systems. The 10-K describes a “Mercury Processing Platform” as an end-to-end processing ecosystem spanning signal, compute, data management, display and security.

Common Processing Architecture. The Q4 FY2026 presentation reports the “largest quarter ever for CPA bookings.” CPA is Mercury’s standardized, open-architecture product line; the sources reviewed do not describe its hardware in detail.

Strategic shift. An analyst-style summary of the CEO extension describes a move from customized, low-margin engineering contracts toward standardized, open-architecture modular components aligned with DoD SOSA and MOSA. That framing is the article’s, not Mercury’s own words.

Sole-source cuts both ways. The 10-K says Mercury holds “the sole source for many unique capabilities,” and separately lists components bought from sole-source suppliers (FPGAs, ASICs, processors, memory, specialty glass) as a supply risk. DoD’s open-architecture push is the pressure on the first point; see Curtiss-Wright for the competing SOSA-aligned module line.

Notable Developments

2026-09-16: Board extends Ballhaus through 2030-08-15; summary cites FY27 guidance reaffirmed. (BriefGlance)
2026-08-18: FY2026 results; Q4 bookings $660M; FY2027 outlook of revenue near $1.1B; Palantir strategic agreement applying AI software to material planning and factory operations (benefits not in the outlook). (SEC, MarketBeat)
2026-08 (Q4 FY26): production awards across effectors, airborne, space and missile defense; international sales fell about 15%, attributed to a temporary slowdown while an outsourced contract manufacturer ramped. (MarketBeat)
2018-02-01: Themis Computer acquisition completed for $180M. (Intelligence Community News)

Key People

Bill Ballhaus — Chairman and CEO

LinkedIn: not re-verified
Role: interim CEO June 2023, permanent two months later; contract extended through 2030-08-15 (BriefGlance)

David Farnsworth — EVP and CFO

LinkedIn: not found
Role: named on the Q4 FY2026 earnings call (MarketBeat)

Prior employers were not confirmed from fetched sources.

People — Last Reviewed: 2026-10-23

Claim Verification

Claim: Sole-source positions on key DoD programs

Status: Partially verified

Supporting sources:

FY2026 10-K — “the sole source for many unique capabilities”

Refuting / questioning sources:

The same 10-K says no single program was 10% or more of revenue, and the business section cites DoD’s focus on MOSA; the sources reviewed name no specific sole-source programs.

Summary: The sole-source position is a company statement; which programs it covers is not documented here.

Claim: FY2026 revenue $984M

Status: Verified