V2X Delivers First Quarter Results and Reaffirms Full-Year Guidance

Rhea-AI Summary

V2X (NYSE:VVX) reported strong Q1 2025 financial results, with revenue reaching $1.02 billion and notable 10% year-over-year growth in the Indo-Pacific region. The company's net income increased significantly to $8.1 million from $1.1 million in the prior year, while adjusted net income grew 10% to $31.5 million. Adjusted EBITDA stood at $67.0 million with a 6.6% margin. Diluted EPS was $0.25, with adjusted diluted EPS up 9% to $0.98. V2X reaffirmed its 2025 guidance, projecting revenue between $4,375-$4,500 million and adjusted EBITDA of $305-$320 million. The company enhanced its capital structure through repricing and extending its revolver and Term Loan A, demonstrating strong market positioning in foreign military sales and international markets.

Positive

• Revenue growth of 10% year-over-year in Indo-Pacific region
• Net income increased significantly from $1.1M to $8.1M year-over-year
• Adjusted net income up 10% to $31.5M
• Adjusted diluted EPS grew 9% to $0.98
• Enhanced capital structure through repricing and extension of revolver and Term Loan A
• Strong market positioning in foreign military sales with visible growth opportunities

Negative

• Relatively modest adjusted EBITDA margin of 6.6%

Insights

Financial Analyst

V2X posted strong adjusted Q1 results with 10% growth in key metrics while reaffirming 2025 guidance, signaling operational stability and sustainable performance.

V2X's Q1 2025 results demonstrate continued financial stability with several encouraging performance indicators. The company generated $1.02 billion in revenue, with notable 10% year-over-year growth in the strategically important Indo-Pacific region, aligning with broader defense sector priorities in that area.

The bottom-line shows significant improvement with net income reaching $8.1 million, a substantial increase from $1.1 million in the prior-year period. The adjusted metrics reveal even stronger performance: adjusted net income of $31.5 million (up 10% year-over-year) and adjusted diluted EPS of $0.98 (up 9% year-over-year). The adjusted EBITDA came in at $67.0 million with a margin of 6.6%.

The large gap between GAAP and adjusted figures ($8.1 million vs. $31.5 million in net income) is noteworthy, though typical in this sector where companies often exclude M&A-related and integration costs. This differential merits monitoring in future quarters to assess underlying earnings quality.

The company's proactive capital structure management through repricing and extending its revolver and Term Loan A should generate interest expense savings and improve cash flow, although specific debt levels weren't disclosed.

V2X's reaffirmation of its full-year 2025 guidance signals management confidence in the business outlook despite what they term a "dynamic market." The guidance midpoints suggest sequential quarterly growth will be necessary to achieve the annual targets: revenue of $4.44 billion, adjusted EBITDA of $313 million, adjusted EPS of $4.65, and adjusted operating cash flow of $160 million.

The company's emphasis on foreign military sales and international opportunities as growth vectors appears well-founded given their existing footprint and relationships in these markets. Their focus on increased bid velocity could drive future contract wins, though specific pipeline values weren't disclosed.

Overall, V2X has delivered a solid quarter with clear year-over-year improvements in key metrics while maintaining a stable outlook for 2025, indicating both current operational stability and confidence in sustainable future performance.

First Quarter Highlights

• Revenue of $1.02 billion with +10% y/y growth in Indo-Pacific region
• Net income of $8.1 million; Adjusted net income¹ of $31.5 million, up 10% y/y
• Adjusted EBITDA¹ of $67.0 million, with a margin of 6.6%
• Diluted EPS of $0.25; Adjusted diluted EPS¹ of $0.98, up 9% y/y
• Enhanced capital structure to generate interest expense savings and cash flow
• Notable progress on new Foreign Military and International Sales opportunities

RESTON, Va., May 5, 2025 /PRNewswire/ -- V2X, Inc. (NYSE:VVX) announced first quarter 2025 financial results.

"The overall trends in our market remain positive and are being driven by customer requirements to improve deterrence, enhance readiness, and strengthen national security," said Jeremy C. Wensinger, President and Chief Executive Officer. "We are performing well as V2X possesses the unique full lifecycle, mission driven solutions to deliver on these requirements. The V2X value proposition is being recognized by customers and is demonstrated by our recent wins and extensions, which provide substantial visibility for the next several years."

Mr. Wensinger continued, "V2X is in an enviable position with strong visibility, differentiated capabilities, and a robust geographic footprint. We are capitalizing on this position by increasing bid velocity. Additionally, the foreign military sales and international markets continue to represent a large and growing addressable opportunity to deliver more solutions across locations in which we already operate. These customers know V2X, they trust V2X, and see the benefit of our solutions. Our focused engagement strategy and visible presence is yielding substantial traction on several nearer-term opportunities that align exactly to our core capabilities."

Mr. Wensinger concluded, "We continue to execute in a dynamic market, bringing the whole of V2X to meet our customers critical mission requirements. It's our employees that make this possible and I'd like to recognize their commitment and contributions."

First Quarter 2025 Results

"V2X reported revenue of $1.02 billion in the quarter, with 10% year-over-year growth in the Indo-Pacific region," said Shawn Mural, Senior Vice President and Chief Financial Officer. "We are pleased with our performance and start to the year, particularly in light of the overall market environment. We remain on track to achieve our commitments and are confident in the strength and resiliency of our business model that generates strong, predictable cash flow."   

"For the quarter, the Company reported operating income of $34.3 million and adjusted operating income¹ of $61.5 million. V2X delivered adjusted EBITDA¹ of $67.0 million, with a margin of 6.6%. Net income for the quarter was $8.1 million dollars, up from $1.1 million dollars from the prior year. Adjusted net income¹ was $31.5 million dollars, increasing 10% year-over-year. First quarter GAAP diluted EPS was $0.25. Adjusted diluted EPS¹ for the quarter was $0.98, increasing 9% year-over-year."

Mr. Mural continued, "During the quarter we continued to demonstrate our steadfast commitment to increasing shareholder value by making further enhancements to our capital structure. Our strong fundamental profile and consistent financial performance created a compelling opportunity to reprice and extend both our revolver and Term Loan A."

Reaffirming 2025 Guidance

Mr. Mural concluded, "The trends and demand signals in our business remain positive and we believe our strategy, visibility, and targeted growth opportunities will yield value creation. Given our performance in the first quarter and current trends, the Company is reaffirming guidance for 2025."

Guidance is as follows:

$ millions, except for per share amounts	2025 Guidance			2025 Mid-Point
Revenue	$4,375		$4,500	$4,438
Adjusted EBITDA1	$305		$320	$313
Adjusted Diluted Earnings Per Share1	$4.45		$4.85	$4.65
Adjusted Net Cash Provided by Operating Activities1	$150		$170	$160

The Company is not providing a quantitative reconciliation with respect to the foregoing forward-looking non-GAAP measures in reliance on the "unreasonable efforts" exception set forth in SEC rules because certain financial information, the probable significance of which cannot be determined, is not available and cannot be reasonably estimated. For example, unusual, one-time, non-ordinary, or non-recurring costs, which relate to M&A, integration and related activities cannot be reasonably estimated. Forward-looking statements are based upon current expectations and are subject to factors that could cause actual results to differ materially from those suggested here, including those factors set forth in the Safe Harbor Statement below. 

First Quarter Conference Call

Management will conduct a conference call with analysts and investors at 4:30 p.m. ET on Monday, May 5, 2025. U.S.-based participants may dial in to the conference call at 877-300-8521, while international participants may dial 412-317-6026. A live webcast of the conference call as well as an accompanying slide presentation will be available here: https://app.webinar.net/0pq4wxEAbDQ    

A replay of the conference call will be posted on the V2X website shortly after completion of the call and will be available for one year. A telephonic replay will also be available through May 19, 2025, at 844-512-2921 (domestic) or 412-317-6671 (international) with passcode 10198194. 

Presentation slides that will be used in conjunction with the conference call will also be made available online in advance on the "investors" section of the company's website at https://gov2x.com. V2X recognizes its website as a key channel of distribution to reach public investors and as a means of disclosing material non-public information to comply with its obligations under the U.S. Securities and Exchange Commission ("SEC") Regulation FD.

1   See "Key Performance Indicators and Non-GAAP Financial Measures" for descriptions and reconciliations.

About V2X
V2X builds innovative solutions that integrate physical and digital environments by aligning people, actions, and technology. V2X is embedded in all elements of a critical mission's lifecycle to enhance readiness, optimize resource management, and boost security. The company provides innovation spanning national security, defense, civilian, and international markets. With a global team of approximately 16,000 professionals, V2X enables mission success by injecting AI and machine learning capabilities to meet today's toughest challenges across all operational domains.

Investor Contact	Media Contact
Mike Smith, CFA	Angelica Spanos Deoudes
IR@goV2X.com	Communications@goV2X.com
719-637-5773	571-338-5195

Safe Harbor Statement
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 (the "Act"): Certain material presented herein includes forward-looking statements intended to qualify for the safe harbor from liability established by the Act.

Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe," "could," "potential," "continue" or similar terminology. These statements are based on the beliefs and assumptions of the management of the Company based on information currently available to management. Forward-looking statements in this press release, include, but are not limited to our future performance and capabilities; all of the statements and items listed under "Reaffirming 2025 Guidance" above and other assumptions contained therein for purposes of such guidance; our belief that prior performance provides substantial visibility for future performance; market trends; our expectations that the foreign military sales and international markets represent a large and growing addressable opportunity; and our belief that our strategy, visibility, and targeted growth opportunities provide substantial opportunities for value creation.

These forward-looking statements are not guarantees of future performance, conditions, or results, and involve a number of known and unknown risks, uncertainties, assumptions, and other important factors, many of which are outside our management's control, which could cause actual results to differ materially from the results discussed in the forward-looking statements.  In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from the Company's historical experience and our present expectations or projections. For a discussion of some of the risks and uncertainties that could cause actual results to differ from such forward-looking statements, see the risks and other factors detailed from time to time in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other filings with the SEC.

We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

V2X, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
		Three Months Ended
		March 28,		March 29,
(In thousands, except per share data)		2025		2024
Revenue		$     1,015,923		$     1,010,564
Cost of revenue		937,820		940,290
Selling, general, and administrative expenses		43,805		39,943
Operating income		34,298		30,331
Loss on extinguishment of debt		(2,214)		—
Interest expense, net		(19,719)		(27,574)
Other expense, net		(2,295)		(1,633)
Income from operations before income taxes		10,070		1,124
Income tax expense (benefit)		1,963		(20)
Net income		$            8,107		$            1,144
Earnings per share
Basic		$              0.26		$              0.04
Diluted		$              0.25		$              0.04
Weighted average common shares outstanding - basic		31,590		31,351
Weighted average common shares outstanding – diluted		32,021		31,794

 

V2X, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
		March 28,		December 31,
(In thousands, except per share data)		2025		2024
Assets
Current assets
Cash, cash equivalents and restricted cash		$        169,062		$        268,321
Receivables		705,384		710,068
Prepaid expenses and other current assets		128,132		121,831
Total current assets		1,002,578		1,100,220
Property, plant, and equipment, net		60,369		62,001
Goodwill		1,656,926		1,656,926
Intangible assets, net		300,527		323,068
Right-of-use assets		36,841		37,774
Other non-current assets		46,239		48,854
Total non-current assets		2,100,902		2,128,623
Total Assets		$     3,103,480		$     3,228,843
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable		$        440,596		$        547,568
Compensation and other employee benefits		124,467		166,918
Short-term debt		19,935		20,003
Other accrued liabilities		282,094		261,735
Total current liabilities		867,092		996,224
Long-term debt, net		1,089,792		1,087,484
Deferred tax liabilities		18,441		20,983
Operating lease liabilities		32,350		33,811
Other non-current liabilities		59,988		64,189
Total non-current liabilities		1,200,571		1,206,467
Total liabilities		2,067,663		2,202,691
Commitments and contingencies (Note 7)
Shareholders' Equity
Preferred stock; $0.01 par value; 10,000,000 shares authorized; No shares issued and outstanding		—		—
Common stock; $0.01 par value; 100,000,000 shares authorized; 31,684,495 and 31,560,490 shares issued and outstanding as of March 28, 2025 and December 31, 2024, respectively		317		316
Additional paid in capital		769,594		769,719
Retained earnings		273,642		265,535
Accumulated other comprehensive loss		(7,736)		(9,418)
Total shareholders' equity		1,035,817		1,026,152
Total Liabilities and Shareholders' Equity		$     3,103,480		$     3,228,843

 

V2X, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
		Three Months Ended
		March 28,		March 29,
(In thousands)		2025		2024
Operating activities
Net income		$            8,107		$            1,144
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation expense		4,250		6,243
Amortization of intangible assets		22,562		22,539
Amortization of cloud computing arrangements		1,226		71
Loss on disposal of property, plant, and equipment		253		8
Stock-based compensation		2,452		5,149
Deferred taxes		(3,074)		(262)
Amortization of debt issuance costs		1,488		2,160
Loss on extinguishment of debt		2,214		—
Changes in assets and liabilities:
Receivables		6,502		(55,363)
Other assets		(6,411)		(23,593)
Accounts payable		(107,694)		(33,715)
Compensation and other employee benefits		(42,610)		(18,607)
Other liabilities		15,271		37,000
Net cash used in operating activities		(95,464)		(57,226)
Investing activities
Purchases of capital assets		(2,699)		(7,775)
Proceeds from the disposition of assets		90		5
Acquisitions of businesses		—		(16,939)
Net cash used in investing activities		(2,609)		(24,709)
Financing activities
Repayments of long-term debt		—		(3,840)
Proceeds from revolver		141,000		375,250
Repayments of revolver		(141,000)		(319,250)
Proceeds from stock awards and stock options		77		3
Payment of debt issuance costs		(1,223)		—
Payments of employee withholding taxes on stock-based compensation		(2,653)		(5,702)
Net cash (used in) provided by financing activities		(3,799)		46,461
Exchange rate effect on cash		2,613		(1,519)
Net change in cash, cash equivalents and restricted cash		(99,259)		(36,993)
Cash, cash equivalents and restricted cash - beginning of period		268,321		72,651
Cash, cash equivalents and restricted cash - end of period		$        169,062		$          35,658
Supplemental disclosure of cash flow information:
Interest paid		$          12,945		$          27,125
Income taxes paid		$               320		$            1,014
Purchase of capital assets on account		$                48		$               410

Key Performance Indicators and Non-GAAP Measures

The primary financial performance measures we use to manage our business and monitor results of operations are revenue trends and operating income trends. Management believes that these financial performance measures are the primary drivers for our earnings and net cash from operating activities. Management evaluates its contracts and business performance by focusing on revenue, and operating income. Operating income represents revenue less both cost of revenue and selling, general and administrative (SG&A) expenses. Cost of revenue consists of labor, subcontracting costs, materials, and an allocation of indirect costs. SG&A expenses consist of indirect labor costs (including wages and salaries for executives and administrative personnel), bid and proposal expenses and other general and administrative expenses not allocated to cost of revenue. Backlog is the estimated amount of future revenues to be recognized under negotiated contracts.

We manage the nature and amount of costs at the program level, which forms the basis for estimating our total costs and profitability. This is consistent with our approach for managing our business, which begins with management's assessing the bidding opportunity for each contract and then managing contract profitability throughout the performance period.

In addition to the key performance measures discussed above, we consider adjusted net income, adjusted diluted earnings per share, adjusted operating income, adjusted EBITDA, adjusted EBITDA margin, net leverage ratio and adjusted operating cash flow to be useful to management and investors in evaluating our operating performance, and to provide a tool for evaluating our ongoing operations. This information can assist investors in assessing our financial performance and measures our ability to generate capital for deployment among competing strategic alternatives and initiatives. We provide this information to our investors in our earnings releases, presentations, and other disclosures.

Adjusted net income, adjusted diluted earnings per share, adjusted operating income, adjusted EBITDA, adjusted EBITDA margin, net leverage ratio, and adjusted net cash provided by (used in) operating activities, however, are not measures of financial performance under GAAP and should not be considered a substitute for financial measures determined in accordance with GAAP.  Definitions and reconciliations of these items are provided below.

• Adjusted operating income is defined as operating income, adjusted to exclude items that may include, but are not limited to, significant charges or credits, and unusual and infrequent non-operating items that impact current results but are not related to our ongoing operations, such as M&A, integration, and related costs.
• Adjusted EBITDA is defined as operating income, adjusted to exclude depreciation and amortization of intangible assets, and items that may include, but are not limited to, significant charges or credits, and unusual and infrequent non-operating items that impact current results but are not related to our ongoing operations, such as M&A, integration, and related costs.
• Adjusted EBITDA margin is defined as adjusted EBITDA divided by revenue.
• Adjusted net income is defined as net income, adjusted to exclude items that may include, but are not limited to, significant charges or credits, and unusual and infrequent non-operating items that impact current results but are not related to our ongoing operations, such as M&A, integration and related costs, amortization of acquired intangible assets, amortization of debt issuance costs, and loss on extinguishment of debt.
• Adjusted diluted earnings per share is defined as adjusted net income divided by the weighted average diluted common shares outstanding.
• Cash interest expense, net is defined as interest expense, net adjusted to exclude amortization of debt issuance costs.
• Adjusted net cash provided by (used in) operating activities or adjusted operating cash flow is defined as net cash provided by (or used in) operating activities adjusted to exclude infrequent non-operating items, such as M&A payments and related costs.

Non-GAAP Tables

($K, except per share data)	Three Months Ended
	March 28, 2025		March 29, 2024
Revenue	$                           1,015,923		$                             1,010,564
Net income (loss)	$                                  8,107		$                                    1,144
Plus:
Income tax expense (benefit)	1,963		(20)
Other expense, net	2,295		1,633
Interest expense, net	19,719		27,574
Loss on extinguishment of debt	2,214		—
Operating income	$                               34,298		$                                 30,331
Plus:
Amortization of intangible assets	22,562		22,539
M&A, integration and related costs	4,625		9,981
Adjusted operating income	$                               61,485		$                                 62,851
Plus:
Depreciation and CCA amortization	5,476		6,243
Adjusted EBITDA	$                                66,961		$                                69,094
Adjusted EBITDA margin	6.6 %		6.8 %
Minus:
Cash interest expense, net	18,231		25,414
Income tax expense, as adjusted	9,234		7,155
Depreciation and CCA amortization	5,476		6,243
Other expense, net, as adjusted	2,545		1,633
Adjusted net income	$                                31,475		$                                28,649
($K, except per share data)	Three Months Ended
	March 28, 2025		March 29, 2024
Diluted earnings (loss) per share	$                                     0.25		$                                     0.04
Plus:
M&A, integration and related costs	0.11		0.25
Amortization of intangible assets	0.54		0.56
Amortization of debt issuance costs and     Loss on extinguishment of debt	0.09		0.05
FMV land impairment	$                                         —		$                                         —
Gain on acquisition, net	$                                    (0.01)		$                                         —
Adjusted diluted earnings per share	$                                     0.98		$                                     0.90
Average shares outstanding:
Basic, as reported	31,590		31,351
Diluted, as reported	32,021		31,794
Adjusted diluted	32,021		31,794
($K)	Three Months Ended
	March 28, 2025		March 29, 2024
Net cash used by operating activities	(95,464)		(57,226)
Plus:
M&A, integration, and related payments	3,008		5,837
MARPA facility activity	(25,617)		(32,108)
Adjusted operating cash flow	(118,073)		(83,497)

SUPPLEMENTAL INFORMATION

Revenue by customer, contract type, contract relationship, and geographic region for the periods presented below was as follows: 

Revenue by Customer
		Three Months Ended
		March 28,		March 29,		%
(In thousands)		2025		2024		Change
Army		$        442,136		$        433,430		2.0 %
Navy		346,118		321,384		7.7 %
Air Force		99,126		118,569		(16.4) %
Other		128,543		137,181		(6.3) %
Total revenue		$     1,015,923		$     1,010,564
Revenue by Contract Type
		Three Months Ended
		March 28,		March 29,		%
(In thousands)		2025		2024		Change
Cost-plus and cost-reimbursable		$        623,213		$        584,822		6.6 %
Firm-fixed-price		363,950		397,251		(8.4) %
Time-and-materials		28,760		28,491		0.9 %
Total revenue		$     1,015,923		$     1,010,564
Revenue by Contract Relationship
		Three Months Ended
		March 28,		March 29,		%
(In thousands)		2025		2024		Change
Prime contractor		$        962,421		$        945,155		1.8 %
Subcontractor		53,502		65,409		(18.2) %
Total revenue		$     1,015,923		$     1,010,564
Revenue by Geographic Region
		Three Months Ended
		March 28,		March 29,		%
(In thousands)		2025		2024		Change
United States		$        577,458		$        544,726		6.0 %
Middle East		318,345		343,296		(7.3) %
Asia		75,978		68,802		10.4 %
Europe		44,142		53,740		(17.9) %
Total revenue		$     1,015,923		$     1,010,564

   

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SOURCE V2X, Inc.

FAQ

What were V2X (VVX) key financial results for Q1 2025?

V2X reported Q1 2025 revenue of $1.02 billion, net income of $8.1 million, adjusted EBITDA of $67.0 million, and adjusted diluted EPS of $0.98, up 9% year-over-year.

What is V2X's (VVX) revenue guidance for 2025?

V2X reaffirmed its 2025 revenue guidance range of $4,375-$4,500 million, with a midpoint of $4,438 million.

How much did V2X (VVX) grow in the Indo-Pacific region in Q1 2025?

V2X reported 10% year-over-year growth in the Indo-Pacific region during Q1 2025.

What was V2X's (VVX) adjusted EBITDA margin in Q1 2025?

V2X reported an adjusted EBITDA margin of 6.6% in Q1 2025, with adjusted EBITDA of $67.0 million.

What is V2X's (VVX) adjusted EPS guidance for 2025?

V2X provided adjusted diluted EPS guidance of $4.45-$4.85 for 2025, with a midpoint of $4.65.