ELBIT SYSTEMS REPORTS SECOND QUARTER 2026 RESULTS
Rhea-AI Summary
Elbit Systems (NASDAQ: ESLT) reported second quarter 2026 revenues of $2.29 billion, up from $1.97 billion a year earlier. GAAP net income was $173.6 million (7.6% margin) with GAAP diluted EPS of $3.61; non-GAAP net income was $199.1 million with EPS of $4.14.
GAAP operating income reached $218.8 million (9.6% margin) and non-GAAP operating income $237.5 million (10.4% margin). A record order backlog of $32.0 billion was reported, 73% outside Israel, with 42% scheduled for delivery through 2027. Operating cash flow for the first half of 2026 was $517.8 million, versus $304.0 million a year earlier.
Segment trends included double‑digit revenue growth in C4I and Cyber, ISTAR and EW, Land, and Elbit Systems of America, partially offset by an 8% decline in Aerospace revenues. Recent awards include a ~$350 million tank‑upgrade contract and over $370 million in U.S. Customs and Border Protection awards. The board declared a $1.00 per share dividend payable October 26, 2026.
Positive
- Revenue growth to $2,287.1M in Q2 2026 from $1,972.7M in Q2 2025
- Operating margin expansion to 9.6% GAAP and 10.4% non-GAAP in Q2 2026
- GAAP net income up to $173.6M and EPS to $3.61 in Q2 2026
- Record order backlog of $32.0B, with 73% from outside Israel
- Operating cash flow of $517.8M in H1 2026 vs. $304.0M in H1 2025
- New contracts of about $350M for MBT upgrades and $370M+ from U.S. CBP
- Dividend declaration of $1.00 per share, payable October 26, 2026
Negative
- Aerospace segment revenues declined 8% year over year in Q2 2026
- Effective tax rate increased to 16.4% from 5.6%, driven by OECD Pillar II rules
- Operational disruptions from Middle East conflicts, supply chain issues and facility attacks reported
News Explained
The declared $1.00-per-share dividend is the concrete holder-level change, with payment scheduled after withholding tax.
Elbit Systems reported its second-quarter results for the period ended
The dividend has a
The company says it recognized a cumulative year-to-date impact of approximately
The release identifies a mixed operating backdrop: conflicts increased demand from Israel's Ministry of Defense while also causing supply-chain and operational disruptions. The stated watch item is whether those disruptions increase again as the duration and scope of hostilities and ceasefire arrangements develop.
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| May 26 | Q1 earnings | Positive | +11.0% | Revenue, EPS, backlog and operating cash flow increased; the 24-hour reaction was positive. |
| Mar 17 | Q4 earnings | Positive | +16.0% | Full-year growth, record cash flow and backlog expansion accompanied a positive reaction. |
| Nov 18 | Q3 earnings | Positive | +0.2% | Quarterly results and a large contract disclosure preceded a positive reaction. |
| Aug 13 | Q2 earnings | Positive | +5.6% | Revenue, earnings, backlog and dividend were reported alongside a positive reaction. |
| May 20 | Q1 earnings | Positive | +0.4% | Revenue, backlog, earnings and dividend growth accompanied a positive reaction. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Tag-specific earnings announcements were followed by positive 24-hour reactions in all five available historical events, averaging 6.63%.
Key Terms
gaap financial
non-gaap financial
order backlog financial
global minimum tax regulatory
AI-generated analysis. How Rhea-AI works. Not financial advice.
Order backlog at
In this release, the Company is providing US-GAAP results as well as Non-GAAP financial data, which are intended to provide investors with a more comprehensive view of the Company's business results and trends. For a description of the Company's Non-GAAP definitions see page 11 below, "Non-GAAP financial data". Unless otherwise stated, all financial data presented is US-GAAP financial data.
Management Comment:
Bezhalel (Butzi) Machlis, President and CEO of Elbit Systems, stated:
"The strong momentum in the second quarter was sustained, delivering double-digit growth in sales, backlog and earnings per share, improved profitability, and strong cash flow generation. Our backlog reached a new record of
Elbit Systems continues to invest in R&D to secure our future growth. Our increased capital investments in production infrastructure reflect a disciplined approach to scaling the business, enhancing execution, increasing capacity, and supporting our ability to deliver at scale, while converting backlog into sustainable revenue and earnings growth.
Elbit Systems is leading the development of next-generation high power laser and directed energy capabilities. Most recently, we unveiled our airborne high-power laser system, currently under development for helicopters and fighter aircraft. This new capability builds on decades of technological and operational experience and will further expand Elbit Systems' broad portfolio of systems, supporting customers and helping protect nations and critical assets around the world."
Second quarter 2026 results:
Revenues in the second quarter of 2026 were
C4I and Cyber revenues increased by
For distribution of revenues by segments and geographic regions see the tables on page 10.
GAAP gross profit in the second quarter of 2026 was
Research and development expenses, net were
Marketing and selling expenses, net were
General and administrative expenses, net were
GAAP operating income in the second quarter of 2026 was
Financial expenses, net were
Taxes on income were
* see page 11
GAAP net income attributable to the Company's shareholders in the second quarter of 2026 was
GAAP diluted earnings per share attributable to the Company's shareholders in the second quarter of 2026 were
The Company's order backlog as of June 30, 2026 totaled
Cash flow provided by operating activities in the six months ended June 30, 2026 was
* see page 11
Impact of the recent conflicts in the
The war which began on October 7, 2023, continued throughout most of 2025, with ceasefires agreed to between
Since the commencement of the war and the escalation of conflicts in the
As a result of the war and the other conflicts in the
Elbit Systems has taken various steps to protect its employees worldwide, to support increased production, to increase raw material and component inventories, to mitigate supply chain disruptions and to maintain business continuity. Following the ceasefire agreements described above, these operational effects on the Company have been reduced, however, such effects on the Company's performance could increase again, depending on future developments that are difficult to predict at this time, including the duration and scope of these conflicts and the continuity and stability of the ceasefire arrangements.
The Law for the Encouragement and Incentivization of Research and Development:
On March 31, 2026, the Knesset enacted the Law for the Encouragement and Incentivization of Research and Development 5786-2026 (the "R&D Law"). The R&D Law applies to qualifying R&D expenditures incurred at the beginning of the tax year starting January 1, 2026. The Company implemented the new R&D Law for the first time and recognized a cumulative year-to-date impact of approximately
Recent Events:
On May 28, 2026, the Company announced that it was awarded a contract valued at approximately
On July 20, 2026, the Company announced that its
On August 6, 2026, the Company announced that at its Annual General Meeting of Shareholders held on August 5, 2026 at the Company's offices in
Dividend:
The Board of Directors declared a dividend of
Conference Call:
The Company will be hosting a conference call today, Tuesday, August 11, 2026, at 9:00 a.m. Eastern Time. On the call, management will review and discuss the results and will be available to answer questions.
To participate, please call one of the teleconferencing numbers that follow. If you are unable to connect using the toll-free numbers, please try the international dial-in number.
US Dial-in Number: 1-866-744-5399
Canada Dial-in Number: 1-866-485-2399
Israel Dial-in Number: 03-918-0644
International Dial-in Number: 972-3-918-0644
at 9:00 am Eastern Time; 6:00 am Pacific Time; 4:00 pm Israel Time
The conference call will also be broadcast live on Elbit Systems' website at https://www.elbitsystems.com. An online replay will be available from 24 hours after the call ends.
Alternatively, for two days following the call, investors will be able to dial a replay number to listen to the call. The dial-in numbers are: 1-888-782-4291 (US and
About Elbit Systems:
Elbit Systems is a leading global defense technology company, delivering advanced solutions for a secure and safer world. Elbit Systems develops, manufactures, integrates and sustains a range of next-generation solutions across multiple domains.
Driven by its agile, collaborative culture, and leveraging
Elbit Systems employs over 21,000 people in dozens of countries across five continents. The Company reported
For additional information, visit: https://elbitsystems.com/, follow us on X or visit our official Facebook, Youtube and LinkedIn channels.
Attachments:
Consolidated balance sheets
Consolidated statements of income
Consolidated statements of cash flows
Consolidated revenue distribution by geographical regions and by segments
Company Contact:
Dr. Yaacov (Kobi) Kagan, EVP & Chief Financial Officer Tel: +972-77-2946663
Daniella Finn, VP, Investor Relations Tel: +972-77-2948984 daniella.finn@elbitsystems.com
Dalia Bodinger, VP, Communications & Brand Tel: +972-77-2947602 |
This press release may contain forward–looking statements (within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Israeli Securities Law, 1968) regarding Elbit Systems Ltd. and/or its subsidiaries (collectively the Company), to the extent such statements do not relate to historical or current facts. Forward-looking statements are based on management's current expectations, estimates, projections and assumptions about future events. Forward–looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions about the Company, which are difficult to predict, including projections of the Company's future financial results, its anticipated growth strategies and anticipated trends in its business. Therefore, actual future results, performance and trends may differ materially from these forward–looking statements due to a variety of factors, including, without limitation: scope and length of customer contracts; governmental regulations and approvals; changes in governmental budgeting priorities; general market, political and economic conditions in the countries in which the Company operates or sells, including
Although the Company believes the expectations reflected in the forward-looking statements contained herein are reasonable, it cannot guarantee future results, level of activity, performance or achievements. Moreover, neither the Company nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. The Company does not undertake to update its forward-looking statements.
Elbit Systems Ltd., its logo, brand, product, service and process names appearing in this press release are the trademarks or service marks of Elbit Systems Ltd. or its affiliated companies. All other brand, product, service and process names appearing are the trademarks of their respective holders. Reference to or use of a product, service or process other than those of Elbit Systems Ltd. does not imply recommendation, approval, affiliation or sponsorship of that product, service or process by Elbit Systems Ltd. Nothing contained herein shall be construed as conferring by implication, estoppel or otherwise any license or right under any patent, copyright, trademark or other intellectual property right of Elbit Systems Ltd. or any third party, except as expressly granted herein.
(FINANCIAL TABLES TO FOLLOW)
ELBIT SYSTEMS LTD. | |||
CONSOLIDATED BALANCE SHEETS | |||
(US Dollars in thousands) | |||
As of June 30, 2026 | As of December 31, 2025 | ||
Assets | |||
Cash and cash equivalents | $ 255,336 | $ 635,141 | |
Short-term bank deposits | 707,599 | 180,604 | |
Trade and unbilled receivables and contract assets, net | 4,166,677 | 3,332,249 | |
Other receivables and prepaid expenses | 498,916 | 457,385 | |
Inventories, net | 3,236,994 | 3,129,756 | |
Total current assets | 8,865,522 | 7,735,135 | |
Investments in affiliated companies and other companies | 134,226 | 126,900 | |
Long-term trade and unbilled receivables and contract assets | 562,316 | 719,078 | |
Long-term bank deposits and other receivables | 144,861 | 51,601 | |
Deferred income taxes, net | 92,512 | 86,679 | |
Severance pay fund | 237,093 | 222,555 | |
Total | 1,171,008 | 1,206,813 | |
Operating lease right of use assets | 500,534 | 515,620 | |
Property, plant and equipment, net | 1,461,412 | 1,382,120 | |
Goodwill and other intangible assets, net | 1,860,172 | 1,821,830 | |
Total assets | $ 13,858,648 | $ 12,661,518 | |
Liabilities and Equity | |||
Short-term bank credit and loans | $ — | $ 50,532 | |
Current maturities of long-term loans and Series B, C and D Notes | 87,534 | 83,452 | |
Operating lease liabilities | 96,959 | 98,464 | |
Trade payables | 1,688,040 | 1,511,671 | |
Other payables and accrued expenses | 1,690,200 | 1,549,139 | |
Contract liabilities | 2,793,121 | 2,683,180 | |
Total current liabilities | 6,355,854 | 5,976,438 | |
Long-term loans, net of current maturities | 4,592 | 18,000 | |
Series B, C and D Notes, net of current maturities | 175,384 | 237,625 | |
Employee benefit liabilities | 513,699 | 487,760 | |
Deferred income taxes and tax liabilities, net | 150,648 | 137,662 | |
Contract liabilities | 1,523,198 | 934,256 | |
Operating lease liabilities | 487,768 | 476,737 | |
Other long-term liabilities | 237,487 | 263,067 | |
Total long-term liabilities | 3,092,776 | 2,555,107 | |
Elbit Systems Ltd.'s equity | 4,409,667 | 4,129,598 | |
Non-controlling interests | 351 | 375 | |
Total equity | 4,410,018 | 4,129,973 | |
Total liabilities and equity | $ 13,858,648 | $ 12,661,518 | |
ELBIT SYSTEMS LTD. | |||||||||
CONSOLIDATED STATEMENTS OF INCOME | |||||||||
(US Dollars in thousands, except for share and per share amounts) | |||||||||
Six months | Six months | Three months | Three months | Year ended | |||||
Revenues | $ 4,475,904 | $ 3,868,460 | $ 2,287,058 | $ 1,972,659 | $ 7,938,627 | ||||
Cost of revenues | 3,344,838 | 2,941,240 | 1,708,051 | 1,499,748 | 6,003,374 | ||||
Gross profit | 1,131,066 | 927,220 | 579,007 | 472,911 | 1,935,253 | ||||
Operating expenses: | |||||||||
Research and development, net | 309,510 | 243,937 | 159,124 | 129,668 | 517,142 | ||||
Marketing and selling, net | 204,062 | 192,410 | 103,202 | 91,528 | 399,437 | ||||
General and administrative, net | 193,570 | 183,347 | 97,887 | 93,898 | 347,250 | ||||
Total operating expenses | 707,142 | 619,694 | 360,213 | 315,094 | 1,263,829 | ||||
Operating income | 423,924 | 307,526 | 218,794 | 157,817 | 671,424 | ||||
Financial expenses, net | (54,234) | (70,128) | (22,046) | (31,171) | (138,618) | ||||
Other income (expenses), net | 3,963 | 3,603 | 2,245 | (1,343) | 29,109 | ||||
Income before income taxes | 373,653 | 241,001 | 198,993 | 125,303 | 561,915 | ||||
Taxes on income | (55,473) | (23,118) | (32,708) | (7,057) | (55,539) | ||||
318,180 | 217,883 | 166,285 | 118,246 | 506,376 | |||||
Equity in net earnings of affiliated companies | 16,200 | 15,509 | 7,240 | 7,776 | 29,243 | ||||
Net income | $ 334,380 | $ 233,392 | $ 173,525 | $ 126,022 | $ 535,619 | ||||
Less: net expense (income) attributable | 44 | (608) | 108 | (323) | (1,280) | ||||
Net income attributable to Elbit Systems Ltd.'s shareholders | $ 334,424 | $ 232,784 | $ 173,633 | $ 125,699 | $ 534,339 | ||||
Earnings per share attributable to Elbit Systems Ltd.'s shareholders: | |||||||||
Basic net earnings per share | $ 7.17 | $ 5.17 | $ 3.71 | $ 2.76 | $ 11.69 | ||||
Diluted net earnings per share | $ 6.95 | $ 5.05 | $ 3.61 | $ 2.69 | $ 11.39 | ||||
Weighted average number of shares used in computation of: | |||||||||
Basic earnings per share (in thousands) | 46,622 | 45,052 | 46,766 | 45,513 | 45,710 | ||||
Diluted earnings per share (in thousands) | 48,124 | 46,122 | 48,124 | 46,697 | 46,918 | ||||
ELBIT SYSTEMS LTD. | |||||
CONSOLIDATED STATEMENTS OF CASH FLOW | |||||
(US Dollars in thousands) | |||||
Six months | Six months | Year ended | |||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||
Net income | $ 334,380 | $ 233,392 | $ 535,619 | ||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation and amortization | 93,532 | 85,255 | 171,434 | ||
Stock-based compensation | 14,567 | 11,496 | 26,391 | ||
Amortization of Series B, C and D related issuance costs, net | 173 | 393 | 394 | ||
Deferred income taxes and reserve, net | (1,856) | (14,751) | (14,687) | ||
Loss on sale of property, plant and equipment | 1,354 | 1,727 | 2,893 | ||
Loss (gain) on sale of investment, remeasurement of investment held under fair value | — | 6,954 | (4,518) | ||
Equity in net earnings of affiliated companies, net of dividend received(*) | (6,570) | (6,608) | (10,190) | ||
Changes in operating assets and liabilities, net of amounts acquired: | |||||
Increase in trade and unbilled receivables and prepaid expenses | (813,298) | (358,217) | (659,951) | ||
Increase in inventories, net | (107,042) | (171,708) | (357,926) | ||
Increase in trade payables, other payables and accrued expenses | 312,916 | 348,910 | 463,913 | ||
Severance, pension and termination indemnities, net | (9,170) | (9,598) | (26,328) | ||
Increase in contract liabilities | 698,796 | 176,725 | 651,334 | ||
Net cash provided by operating activities | 517,782 | 303,970 | 778,378 | ||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||
Purchase of property, plant and equipment and other assets, net of investment grants and | (157,557) | (72,474) | (225,568) | ||
Acquisition of subsidiaries, net of cash assumed | (33,738) | — | — | ||
Investments in affiliated companies and other companies, net | (1,917) | (100) | (2,288) | ||
Proceeds from sale of property, plant and equipment | 1,288 | 458 | 1,133 | ||
Proceeds from sale of investments | 2,100 | — | 15,000 | ||
Proceeds from sale of (investment in) long-term deposits, net | 941 | 159 | (31) | ||
Investment in short-term deposits, net | (502,601) | (738,401) | (178,962) | ||
Net cash used in investing activities | (691,484) | (810,358) | (390,716) | ||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||
Proceeds from issuance of shares and exercise of options | 136 | 573,000 | 573,064 | ||
Repayment of commercial paper | (48,409) | (95,036) | (301,591) | ||
Repayment of long-term bank loans | (12,905) | (11,355) | (11,423) | ||
Proceeds from non-controlling interests, net | 15,749 | — | — | ||
Repayment of Series B, C and D Notes | (74,967) | (67,738) | (67,496) | ||
Dividends paid | (81,771) | (49,103) | (111,693) | ||
Change in short-term bank credit and loans and other, net | (3,936) | 381 | (98,733) | ||
Net cash provided by (used in) financing activities | (206,103) | 350,149 | (17,872) | ||
Net increase (decrease) in cash and cash equivalents | (379,805) | (156,239) | 369,790 | ||
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD | $ 635,141 | $ 265,351 | $ 265,351 | ||
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD | $ 255,336 | $ 109,112 | $ 635,141 | ||
(*) Dividend received from affiliated companies | $ 9,630 | $ 8,901 | $ 19,053 | ||
ELBIT SYSTEMS LTD. | |||||||||||||||||||
DISTRIBUTION OF REVENUES | |||||||||||||||||||
(US Dollars in millions) | |||||||||||||||||||
Consolidated revenues by geographical regions: | |||||||||||||||||||
Six months | % | Six months | % | Three | % | Three | % | Year ended | % | ||||||||||
$ 1,672.9 | 37.4 | $ 1,279.6 | 33.1 | $ 855.0 | 37.4 | $ 670.5 | 34.0 | $ 2,556.4 | 32.2 | ||||||||||
898.4 | 20.1 | 797.8 | 20.6 | 464.7 | 20.3 | 404.6 | 20.5 | 1,659.3 | 20.9 | ||||||||||
1,075.6 | 24.0 | 1,020.6 | 26.4 | 563.3 | 24.6 | 563.8 | 28.6 | 2,139.5 | 27.0 | ||||||||||
661.7 | 14.8 | 605.1 | 15.6 | 319.9 | 14.0 | 261.9 | 13.3 | 1,243.7 | 15.7 | ||||||||||
70.2 | 1.6 | 50.7 | 1.3 | 37.2 | 1.6 | 22.6 | 1.1 | 99.0 | 1.2 | ||||||||||
Other countries | 97.1 | 2.1 | 114.7 | 3.0 | 47.0 | 2.1 | 49.3 | 2.5 | 240.7 | 3.0 | |||||||||
Total revenue | $ 4,475.9 | 100.0 | $ 3,868.5 | 100.0 | $ 2,287.1 | 100.0 | $ 1,972.7 | 100.0 | $ 7,938.6 | 100.0 | |||||||||
Consolidated revenues by segments: | |||||||||
Six months | Six months | Three months | Three months | Year ended | |||||
Aerospace | |||||||||
External customers | $ 877.5 | $ 922.2 | $ 422.7 | $ 474.2 | $ 1,820.9 | ||||
Intersegment revenue | 134.1 | 118.9 | 72.3 | 62.6 | 246.1 | ||||
Total | 1,011.6 | 1,041.1 | 495.0 | 536.8 | 2,067.0 | ||||
C4I and Cyber | |||||||||
External customers | 483.2 | 417.2 | 241.1 | 213.0 | 866.2 | ||||
Intersegment revenue | 26.4 | 29.6 | 11.8 | 13.8 | 64.7 | ||||
Total | 509.6 | 446.8 | 252.9 | 226.8 | 930.9 | ||||
ISTAR and EW | |||||||||
External customers | 773.9 | 614.6 | $ 402.1 | 311.1 | 1,323.5 | ||||
Intersegment revenue | 96.9 | 113.9 | 45.7 | 56.4 | 202.3 | ||||
Total | 870.8 | 728.5 | 447.8 | 367.5 | 1,525.8 | ||||
Land | |||||||||
External customers | 1,448.5 | 1,106.0 | 749.5 | 566.8 | 2,250.3 | ||||
Intersegment revenue | 36.4 | 37.9 | 20.7 | 16.3 | 68.4 | ||||
Total | 1,484.9 | 1,143.9 | 770.2 | 583.1 | 2,318.7 | ||||
ESA | |||||||||
External customers | 892.8 | 808.5 | 471.7 | 407.6 | 1,677.7 | ||||
Intersegment revenue | 7.9 | 4.9 | 5.1 | 1.6 | 16.4 | ||||
Total | 900.7 | 813.4 | 476.8 | 409.2 | 1,694.1 | ||||
Revenues | |||||||||
Total revenues (external | 4,777.6 | 4,173.7 | 2,442.7 | 2,123.4 | 8,536.5 | ||||
Less - intersegment revenue | (301.7) | (305.2) | (155.6) | (150.7) | (597.9) | ||||
Total revenues | $ 4,475.9 | $ 3,868.5 | $ 2,287.1 | $ 1,972.7 | $ 7,938.6 | ||||
Non-GAAP financial data:
The following Non-GAAP financial data, including Non-GAAP gross profit, Non-GAAP operating income, Non-GAAP net income attributable to the Company's shareholders, and Adjusted diluted earnings per share, is presented to enable investors to have additional information on our business performance as well as a further basis for periodical comparisons and trends relating to our financial results. We believe such data provides useful information to investors and analysts by facilitating more meaningful comparisons of our financial results over time. The Non-GAAP adjustments exclude amortization expenses of intangible assets related to acquisitions that occurred mainly in prior periods, capital gains related primarily to the sale of investments, restructuring activities, Non-identified costs in respect to special circumstances, non-cash stock based compensation expenses, revaluations of investments in affiliated companies, non-operating foreign exchange gains or losses, one-time tax expenses, and the effect of tax on each of these items. We present these Non-GAAP financial measures because management believes they supplement and/or enhance management's, analysts' and investors' overall understanding of the Company's underlying financial performance and trends and facilitate comparisons among current, past, and future periods.
Specifically, management uses Non-GAAP gross profit, Non-GAAP operating income, and Non-GAAP net income attributable to the Company's shareholders to measure the ongoing gross profit, operating profit and net income performance of the Company because the measure adjusts for more significant non-recurring items, amortization expenses of intangible assets relating to prior acquisitions, and non-cash expense which can fluctuate year to year.
We believe Non-GAAP gross profit, Non-GAAP operating income, and Non-GAAP net income attributable to the Company's shareholders are useful to existing shareholders, potential shareholders and other users of our financial information because they provide measures of the Company's ongoing performance that enable these users to perform trend analysis using comparable data.
Management uses Non-GAAP diluted net earnings per share attributed to Company's shareholders to evaluate further adjusted net income attributable to the Company's shareholders while considering changes in the number of diluted shares over comparable periods.
We believe Non-GAAP diluted net earnings per share attributable to Company's shareholders is useful to existing shareholders, potential shareholders and other users of our financial information because it also enables these users to evaluate adjusted net income attributable to Company's shareholders on a per-share basis.
The Non-GAAP measures used by the Company are not based on any comprehensive set of accounting rules or principles. We believe that Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations, as determined in accordance with GAAP, and that these measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP measures.
Investors are cautioned that, unlike financial measures prepared in accordance with GAAP, Non-GAAP measures may not be comparable with the calculation of similar measures for other companies. They should consider Non-GAAP financial measures in addition to, and not as replacements for or superior to, measures of financial performance prepared in accordance with GAAP.
Reconciliation of GAAP to Non-GAAP Supplemental Financial Data: | |||||||||
(US Dollars in millions, except for per share amounts) | |||||||||
Six months | Six months | Three | Three | Year ended | |||||
GAAP gross profit | $ 1,131.1 | $ 927.2 | $ 579.0 | $ 472.9 | $ 1,935.3 | ||||
Adjustments: | |||||||||
Amortization of purchased intangible assets(*) | 7.8 | 8.0 | 3.9 | 4.0 | 16.2 | ||||
Stock based compensation | 2.2 | 1.7 | 1.2 | 0.9 | 4.0 | ||||
Non-identified costs in respect to special | 4.1 | 4.0 | 2.4 | 2.6 | 6.3 | ||||
Non-GAAP gross profit | $ 1,145.2 | $ 940.9 | $ 586.5 | $ 480.4 | $ 1,961.8 | ||||
Percent of revenues | 25.6 % | 24.3 % | 25.6 % | 24.4 % | 24.7 % | ||||
GAAP operating income | $ 423.9 | $ 307.5 | $ 218.8 | $ 157.8 | $ 671.4 | ||||
Adjustments: | |||||||||
Amortization of purchased intangible assets(*) | 15.1 | 15.5 | 7.6 | 7.7 | 31.0 | ||||
Stock based compensation | 14.6 | 11.5 | 7.7 | 5.8 | 26.4 | ||||
Non-identified costs in respect to special | 5.9 | 5.8 | 3.4 | 3.8 | 9.0 | ||||
Non-GAAP operating income | $ 459.5 | $ 340.3 | $ 237.5 | $ 175.1 | $ 737.8 | ||||
Percent of revenues | 10.3 % | 8.8 % | 10.4 % | 8.9 % | 9.3 % | ||||
GAAP net income attributable to Elbit Systems' | 334.4 | 232.8 | 173.6 | 125.7 | 534.3 | ||||
Adjustments: | |||||||||
Amortization of purchased intangible assets(*) | 15.1 | 15.5 | 7.6 | 7.7 | 31.0 | ||||
Stock based compensation | 14.6 | 11.5 | 7.7 | 5.8 | 26.4 | ||||
Non-identified costs in respect to special | 5.9 | 5.8 | 3.4 | 3.8 | 9.0 | ||||
Capital gain | — | — | — | — | (13.7) | ||||
Revaluation of investment measured under fair | — | 6.8 | — | 6.8 | (4.5) | ||||
Non-operating foreign exchange (gains) losses | 7.4 | (1.5) | (1.3) | 2.6 | 18.5 | ||||
Tax effect and other tax items, net | 8.2 | (2.7) | 8.1 | (1.4) | (3.0) | ||||
Non-GAAP net income attributable to Elbit | $ 385.6 | $ 268.2 | $ 199.1 | $ 151.0 | $ 598.0 | ||||
Percent of revenues | 8.6 % | 6.9 % | 8.7 % | 7.7 % | 7.5 % | ||||
GAAP diluted net EPS attributable to Elbit | $ 6.95 | $ 5.05 | $ 3.61 | $ 2.69 | $ 11.39 | ||||
Adjustments, net | 1.06 | 0.76 | 0.53 | 0.54 | 1.36 | ||||
Non-GAAP diluted net EPS attributable to Elbit | $ 8.01 | $ 5.81 | $ 4.14 | $ 3.23 | $ 12.75 | ||||
(*) While amortization of acquired intangible assets is excluded from the measures, the revenue of the acquired companies is reflected in the measures and the acquired assets contribute to revenue generation.
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SOURCE Elbit Systems Ltd.