Mercury Sys Inc Stock Price, News & Analysis

Mercury Systems reported solid second-quarter results for fiscal 2022, with revenues of $220 million, a 5% increase year-over-year, and bookings of $237 million, yielding a book-to-bill ratio of 1.08. The company completed the acquisitions of Avalex Technologies and Atlanta Micro, enhancing its capabilities. However, it reported a GAAP net loss of $2.6 million or $(0.05) per share, compared to a net income of $12.7 million in the same quarter last year. The company forecasts revenues between $1.00 billion and $1.03 billion for the full fiscal year.

Mercury Systems (NASDAQ: MRCY) announced a significant $17 million contract to supply RF microelectronics for missile capabilities, enhancing air dominance for the U.S. and allies. This award was received in the fiscal 2022 first quarter and will be fulfilled over the upcoming quarters. The company emphasizes its role as a vital defense partner, leveraging over 40 years of microelectronics experience for quality production and rapid deployment. This contract reinforces Mercury's position in the defense-grade microelectronics supply chain.

Mercury Systems recently launched the Model 5585 and Model 5586 SOSA-aligned Xilinx Virtex UltraScale+™ FPGA 3U VPX modules, the first in the market to include high-bandwidth memory (HBM) integrated on the chip. This advancement delivers a 20x increase in memory bandwidth over traditional DDR4 memory, enhancing performance for applications such as electronic warfare and radar. The modules promise improved power efficiency and reduced size, weight, and power (SWaP) requirements, vital for mission-critical operations.

Mercury Systems introduces the new RFM3202 sensor, a SOSA aligned wideband transceiver designed for demanding spectrum processing applications. This advanced module consolidates multiple capabilities into a compact design, enhancing performance for smaller platforms such as unmanned vehicles and space-constrained vessels. It features four high-bandwidth channels, delivering an instantaneous bandwidth of 2 GHz per channel and a tunable frequency range of 2–18 GHz. Orders for the RFM3202 are now being accepted, aiming to meet the evolving needs of aerospace and defense industries.

Starboard Value LP, a major shareholder of Mercury Systems (MRCY) with a 7.33% stake, has expressed concerns over the company's recently adopted shareholder rights plan. In a letter to the board dated January 13, 2022, Starboard urged the elimination or revision of the Rights Plan, which they believe does not serve shareholders' best interests. They recommend raising the ownership threshold that triggers the plan from 7.5% to 15% and suggest putting the plan to a shareholder vote. Starboard remains optimistic about the company's future value creation.

Mercury Systems Inc. (NASDAQ: MRCY) will announce its second quarter fiscal year 2022 financial results on February 1, 2022, after market close. A conference call and webcast will follow at 5:00 p.m. ET to discuss the financial results, business highlights, and outlook. Participants can register for the call online. The company focuses on providing secure, mission-critical technologies primarily for the aerospace and defense sectors, emphasizing innovation and secure solutions.

Mercury Systems Inc. (NASDAQ: MRCY) has implemented a limited-duration shareholder rights plan to safeguard investor interests during a period of perceived undervaluation. This decision, made unanimously by the Board, aims to protect long-term shareholder value amidst challenging market conditions. The Rights Plan, lasting one year, distributes rights to shareholders, becoming exercisable if any party acquires over 7.5% of common shares without Board approval. The company intends to ensure fair value realization for all shareholders while evaluating potential offers.

Mercury Systems has launched the Model 5503 Sensor Open Systems Architecture™ (SOSA) aligned high-speed 3U VPX synchronizer module. This optimized commercial-off-the-shelf (COTS) solution addresses the complexities of synchronization in beamforming and phased-array applications across radar, electronic warfare, and communications sectors. The module can synchronize up to 32 channels, showcasing advanced integration and reduced development costs for users. Its SOSA alignment supports interoperability and rapid technology insertion, aligning with the Consortium's goals.

Mercury Systems has announced the acquisition of Atlanta Micro, a leader in RF modules and components, for an undisclosed cash amount. This strategic acquisition aims to enhance Mercury's portfolio in electronic warfare, radar, and weapons markets. Atlanta Micro is projected to contribute approximately $16 million in revenue for the year ending December 31, 2022, with adjusted EBITDA margins exceeding 30%. The deal, funded through Mercury’s revolving credit facility, is expected to be immediately accretive to adjusted EPS and supports Mercury's growth strategy in trusted microelectronics.