Maximus (NYSE: MMS) boosts 2026 outlook and authorizes $400M buyback
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Maximus reported fiscal Q2 2026 results and raised full-year earnings guidance while authorizing a large new share repurchase program. Revenue was $1.31 billion versus $1.36 billion a year earlier, but profitability improved, with diluted EPS of $1.80 and adjusted diluted EPS of $2.07 compared to $1.69 and $2.01.
Adjusted EBITDA margin rose to 14.4%, supported by efficiency gains and AI-enabled automation. The company now expects full-year adjusted EBITDA margin of about 14.2% and adjusted EPS between $8.25 and $8.55, while keeping revenue guidance at $5.2–$5.35 billion and free cash flow at $450–$500 million.
The Board refreshed the share repurchase authorization up to $400 million after buying 2.0 million shares for roughly $151 million through May 1, 2026, and declared a quarterly dividend of $0.33 per share payable June 1, 2026.
Positive
- Raised 2026 earnings outlook with stronger margins: Maximus increased full-year adjusted EBITDA margin guidance to about 14.2% and lifted adjusted diluted EPS guidance to $8.25–$8.55, signaling confidence in sustained profitability improvements.
- Significant capital return via buybacks and dividends: The Board refreshed the share repurchase authorization up to $400 million after repurchasing roughly $151 million of stock through May 1, 2026, while continuing a $0.33 per-share quarterly dividend.
Negative
- Revenue softness and overseas profitability pressure: Q2 2026 revenue declined to $1.31 billion from $1.36 billion, and the Outside the U.S. segment swung to a $3.1 million operating loss from a $4.8 million profit a year earlier.
Insights
Guidance is raised, margins are improving, and capital returns are sizable.
Maximus delivered Q2 2026 revenue of $1.31 billion, slightly below the prior year, but improved profitability with diluted EPS of $1.80 and adjusted EPS of $2.07. Adjusted EBITDA margin expanded to 14.4%, reflecting automation and AI-driven efficiency gains.
The company increased fiscal 2026 adjusted EBITDA margin guidance by 20 bps to about 14.2% and lifted adjusted EPS guidance to $8.25–$8.55, while maintaining revenue guidance of $5.2–$5.35 billion and free cash flow of $450–$500 million. This combination points to a focus on margin quality over top-line growth.
Capital deployment is active: Q2 share repurchases totaled 1.4 million shares for $111 million, with another 0.6 million shares for $39.9 million after quarter-end, and a refreshed $400 million repurchase authorization. A quarterly dividend of $0.33 per share adds to shareholder returns. Actual impact will depend on execution against the raised margin outlook and the pace of awards from the $56.8 billion sales pipeline.
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Q2 2026 revenue: $1,305,967,000
Q2 2026 diluted EPS: $1.80 per share
Q2 2026 adjusted diluted EPS: $2.07 per share
+5 more
8 metrics
Q2 2026 revenue
$1,305,967,000
Three months ended March 31, 2026
Q2 2026 diluted EPS
$1.80 per share
Three months ended March 31, 2026
Q2 2026 adjusted diluted EPS
$2.07 per share
Non-GAAP, three months ended March 31, 2026
Adjusted EBITDA margin
14.4%
Q2 2026, versus 13.7% in prior-year quarter
2026 adjusted EPS guidance
$8.25–$8.55 per share
Fiscal year 2026 outlook
Share repurchase authorization
$400,000,000
Refreshed Board authorization effective May 11, 2026
Q2 2026 free cash flow
$179,017,000
Non-GAAP free cash flow in the quarter
Sales pipeline
$56,800,000,000
Total pipeline at March 31, 2026
Key Terms
adjusted EBITDA, free cash flow, share repurchase program, non-cash impairment charge, +2 more
6 terms
adjusted EBITDA financial
"For the second quarter of fiscal year 2026, operating margin was 11.4% and adjusted EBITDA margin was 14.4%."
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
free cash flow financial
"For the second quarter of fiscal year 2026, cash provided by operating activities totaled $190 million, and free cash flow was $179 million."
Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.
non-cash impairment charge financial
"The second quarter of fiscal year 2026 included a non-cash impairment charge that decreased the U.S. Services segment's operating income by $6.9 million."
A non-cash impairment charge is an accounting write-down that lowers the recorded value of an asset on a company’s books when that asset is judged to be worth less than before. It reduces reported profit for the period without using any cash — like lowering the listed price of a used car in your records — and matters to investors because it can shrink earnings, change valuation metrics, and signal potential problems that might affect future cash flow or credit terms.
organic revenue growth financial
"excluding this support work, segment organic revenue growth was 1.5% over the prior year period."
Organic revenue growth is the increase in a company's sales that comes from its existing products and services, without including any gains from acquisitions or selling off parts of the business. It reflects the company’s ability to attract more customers or encourage existing customers to buy more over time. For investors, it indicates the company's underlying strength and efficiency in expanding its core operations.
sales pipeline financial
"The sales pipeline at March 31, 2026, totaled $56.8 billion, comprised of approximately $4.55 billion in proposals pending."
A sales pipeline is a staged view of potential customers at each step from first contact to a completed sale, showing how many prospects are in play and how far they’ve progressed. Investors watch it like a factory conveyor belt: a healthy, steadily moving pipeline signals likely future revenue and growth, while gaps or bottlenecks can warn that sales targets and cash flow may be at risk.
Earnings Snapshot
Revenue: $1,305,967,000 · Guidance included
Q2 2026
Revenue
$1,305,967,000
Net income
$98,063,000
Diluted EPS
$1.80
Adjusted EBITDA
$188,027,000
Adjusted diluted EPS
$2.07
Guidance
For fiscal 2026, Maximus guides to revenue of $5.2–$5.35 billion, adjusted EBITDA margin of about 14.2%, adjusted diluted EPS of $8.25–$8.55, and free cash flow of $450–$500 million.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 7, 2026
| (Exact name of registrant as specified in its charter) | |||||||||||||||||||||||||||||
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | |||||||||||||||||||||||||||
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(Address of principal executive offices) | (Zip Code) | ||||||||||||||||||||||||||||
| Registrant's telephone number, including the area code | ( | ) | |||||||||||||||||||||||||||
| No Change | |||||||||||||||||||||||||||||
| (Former name or former address, if changed since last report) | |||||||||||||||||||||||||||||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On May 7, 2026, the Company issued a press release announcing its financial results for the quarter ended March 31, 2026. A copy of the press release is furnished as Exhibit 99.1 to this report.
The information contained in this Current Report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | ||||
99.1 | Press release dated May 7, 2026 | ||||
| 104 | Inline XBRL for the cover page of this Current Report on Form 8-K. | ||||
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Maximus, Inc. | ||||||||
| (Registrant) | ||||||||
| Date: May 7, 2026 | /s/ Elizabeth Moellering | |||||||
| Elizabeth Moellering | ||||||||
| General Counsel and Corporate Secretary | ||||||||
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| FOR IMMEDIATE RELEASE | CONTACT: | James Francis, VP - IR | |||||||||
| IR@maximus.com | |||||||||||
| Date: May 7, 2026 | |||||||||||
Maximus Reports Fiscal Year 2026 Second Quarter Results
Raises earnings outlook and announces $400 million share repurchase program
(Tysons, Va. - May 7, 2026) - Maximus (NYSE: MMS), a leading provider of government services, reported financial results for the three and six months ended March 31, 2026.
Highlights for the second quarter of fiscal year 2026 include:
•Revenue of $1.31 billion was consistent with our full fiscal year 2026 expectations, and compares to $1.36 billion for the prior year period.
•Diluted earnings per share were $1.80 and adjusted diluted earnings per share were $2.07, compared to $1.69 and $2.01, respectively, for the prior year period.
•We are raising our adjusted EBITDA margin expectation by 20 basis points to approximately 14.2% and raising our adjusted diluted earnings per share expectation by $0.20 to range between $8.25 and $8.55 per share for the full fiscal year 2026. We are reiterating previous fiscal year 2026 revenue and free cash flow guidance.
•Repurchases of Maximus common stock in the quarter totaled 1.4 million shares for $111 million, with an additional 0.6 million shares totaling $39.9 million repurchased through May 1, 2026.
•The Board of Directors authorized a refresh to the repurchase program for Maximus common stock up to an aggregate of $400 million.
•A quarterly cash dividend of $0.33 per share is payable on June 1, 2026, to shareholders of record on May 15, 2026.
"Our second consecutive earnings guidance increase reflects growing confidence in our ability to leverage in-house AI and other technology capabilities to improve efficiency and support margin expansion. We continue to execute our capital deployment strategy, as highlighted by the refresh of our share repurchase authorization up to an aggregate of $400 million," said Bruce Caswell, President and Chief Executive Officer.
Caswell continued, "Our state customers are gaining clarity and beginning to take action to help address challenges with Medicaid community engagement, SNAP administration, and unemployment insurance support services. We’re pleased to be playing a role in devising these solutions and expect momentum to continue to build."
Second Quarter Results
Revenue for the second quarter of fiscal year 2026 was $1.31 billion and on track with full fiscal year 2026 expectations. Prior year period revenue was $1.36 billion and benefited from natural disaster support work and temporary clinical volume surges in both domestic segments.
For the second quarter of fiscal year 2026, operating margin was 11.4% and adjusted EBITDA margin was 14.4%. This compares to margins of 11.2% and 13.7%, respectively, for the prior year period. Diluted earnings per share were $1.80, and adjusted diluted earnings per share were $2.07. This compares to $1.69 and $2.01, respectively, for the prior year period.
1
Consolidated earnings improved over the prior year period primarily due to efficiency gains through automation, including AI-enabled tools, across multiple program areas. The second quarter of fiscal year 2026 included a non-cash impairment charge that decreased the U.S. Services segment's operating income by $6.9 million, or $0.09 per share, and a discrete research & development tax benefit that reduced the income tax expense by $4.2 million, which equated to a $0.08 per share benefit. Both non-recurring items were excluded from adjusted EBITDA and had offsetting impacts on adjusted diluted earnings per share.
U.S. Federal Services Segment
U.S. Federal Services Segment revenue for the second quarter of fiscal year 2026 was $753 million. Prior year period revenue was $778 million and benefited from natural disaster support. We anticipated the absence of this work in our fiscal year 2026 guidance, and, excluding this support work, segment organic revenue growth was 1.5% over the prior year period.
The segment operating margin for the second quarter of fiscal year 2026 was 17.6%, compared to 15.3% reported for the prior year period. Technology initiatives, including automation that enables greater volume processing without a commensurate increase in labor costs, were the primary driver of the improved margin and the increase to the segment’s full fiscal year margin expectation. The full fiscal year 2026 operating margin for the U.S. Federal Services Segment is expected to be approximately 17.5%.
U.S. Services Segment
U.S. Services Segment revenue for the second quarter of fiscal year 2026 was $416 million and on track to improve segment revenue growth anticipated by the end of the fiscal year. The prior year period segment revenue was $442 million.
The segment operating margin for the second quarter of fiscal year 2026 was 9.3%, or 10.9% excluding the $6.9 million non-cash charge related to an asset impairment. The prior year period segment operating margin was 12.2%. The full fiscal year 2026 operating margin for the U.S. Services Segment is expected to be approximately 10.0% as a result of the non-cash charge this quarter.
Outside the U.S. Segment
Outside the U.S. Segment revenue for the second quarter of fiscal year 2026 was $137 million, compared to $142 million in the prior year period. Following previous reshaping actions, the segment now comprises the United Kingdom, Canada, and the Gulf Region, all of which are tracking opportunities that we believe have the potential to drive future growth.
The segment realized an operating loss of $3.1 million for the second quarter of fiscal year 2026, compared to an operating profit of $4.8 million in the prior year period. We continue to anticipate future margin improvement over time in this segment, which is now expected to break even on a full fiscal year 2026 basis.
Sales and Pipeline
Year-to-date signed contract awards at March 31, 2026, totaled $913 million, and contracts pending (awarded but unsigned) totaled $322 million.
The sales pipeline at March 31, 2026, totaled $56.8 billion, comprised of approximately $4.55 billion in proposals pending, $1.48 billion in proposals in preparation, and $50.7 billion in opportunities we are tracking. New work opportunities represent approximately 59% of the total sales pipeline, and U.S. Federal Services Segment opportunities represent approximately 58% of the total sales pipeline.
Balance Sheet and Cash Flows
At March 31, 2026, unrestricted cash and cash equivalents totaled $157 million, and gross debt was $1.55 billion. The ratio of debt, net of allowed cash, to consolidated EBITDA for the quarter ended March 31, 2026, as calculated on a trailing twelve-month basis in accordance with our credit agreement, was 1.8x. This is unchanged from the ratio at December 31, 2025, and remains below our target net leverage ratio of 2x to 3x.
2
For the second quarter of fiscal year 2026, cash provided by operating activities totaled $190 million, and free cash flow was $179 million. DSO were 78 days at March 31, 2026, and unchanged from the DSO at December 31, 2025. We expect collections to increase in the second half of fiscal year 2026, which supports our full-year free cash flow guidance.
During the second quarter of fiscal year 2026, we purchased approximately 1.4 million shares of Maximus common stock totaling $111 million. Subsequent to March 31, 2026, and through May 1, 2026, we purchased an additional 0.6 million shares totaling $39.9 million. The Board of Directors authorized a refresh to the repurchase program for Maximus common stock up to an aggregate of $400 million, which becomes effective May 11, 2026.
On April 6, 2026, our Board of Directors declared a quarterly cash dividend of $0.33 for each share of our common stock outstanding. The dividend is payable on June 1, 2026, to shareholders of record on May 15, 2026.
Fiscal Year 2026 Earnings Guidance Raise
Maximus is raising fiscal year 2026 earnings guidance and reiterating revenue and free cash flow guidance.
The full year adjusted EBITDA margin guidance improves by 20 basis points to approximately 14.2%, as compared to prior guidance. Guidance for adjusted diluted earnings per share increases by $0.20 and is now expected to range between $8.25 and $8.55 per share for fiscal year 2026.
Revenue guidance is maintained between $5.2 billion and $5.35 billion, and free cash flow guidance is maintained between $450 million and $500 million for fiscal year 2026. Interest expense is estimated to be $84 million, and the full fiscal year tax rate is expected to range between 24.0% and 25.0% for fiscal year 2026.
Conference Call and Webcast Information
Maximus will host a conference call this morning, May 7, 2026, at 9:00 a.m. ET.
The call is open to the public and available by webcast or by phone at:
877.407.8289 (Domestic) / +1.201.689.8341 (International)
For those unable to listen to the live call, a recording of the webcast will be available on investor.maximus.com.
About Maximus
As a leading strategic partner to government, Maximus helps improve the delivery of public services amid complex technology, health, economic, and social challenges. With a deep understanding of program service delivery, acute insights that achieve operational excellence, and an extensive awareness of the needs of the people being served, our employees advance the critical missions of our partners. Maximus provides tech-enabled services to government agencies, including innovative business process management and technology solutions, that provide improved outcomes for the public and higher levels of productivity and efficiency of government-sponsored programs. For more information, visit maximus.com.
Non-GAAP Measures and Forward-Looking Statements
This release contains non-GAAP measures and other indicators, including organic growth, free cash flow, diluted EPS adjusted for amortization of intangible assets and divestiture-related charges and gains, adjusted EBITDA, adjusted EBITDA margin, consolidated EBITDA (as defined by our Credit Agreement), and other non-GAAP measures.
A description of these non-GAAP measures and details as to how they are calculated are included with our earnings presentation and forthcoming Form 10-Q.
The presentation of these non-GAAP numbers is not meant to be considered in isolation, nor as alternatives to cash flows from operations, revenue growth, operating income, or net income as measures of performance. These non-GAAP financial measures, as determined and presented by us, may not be comparable to related or similarly titled measures presented by other companies.
Included in this release are forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as:
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"anticipate," "intend," "plan," "goal," "seek," "on track,” "opportunity," "could," "potential," "believe," "project," "estimate," "expect," "continue," "forecast," "strategy," "future," "likely," "may," "should," "will," and similar references to future periods. Forward-looking statements that are not historical facts, including statements about our confidence, strategies and initiatives, guidance and expectations about revenues, results of operations, profitability, future contracts, liquidity, market opportunities, market demand, acceptance of our products and service offerings, or acquisitions and divestitures, are forward-looking statements that involve risks and uncertainties.
These risks could cause our actual results to differ materially from those indicated by such forward-looking statements. A summary of risk factors can be found in Item 1A, "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended September 30, 2025, filed on November 20, 2025, and subsequent filings with the Securities and Exchange Commission (SEC). Our SEC filings are accessible on maximus.com.
Any forward-looking statement made by us in this release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to update the guidance herein or any other forward-looking statement as circumstances evolve.
| FY26 Guidance Reconciliation - Non-GAAP | |||||||||||
| ($ in millions except per share items) | Low End | High End | |||||||||
| Net income | $ | 394 | $ | 411 | |||||||
| Add: Interest expense / Other (income) | 84 | 84 | |||||||||
| Add: Provision for income taxes | 128 | 133 | |||||||||
| Add: Amortization of intangible assets | 81 | 81 | |||||||||
| Add: Depreciation & amortization of property, equipment and capitalized software | 54 | 54 | |||||||||
| Add: Capitalized software impairment charges | 7 | 7 | |||||||||
| Add: Divestiture-related gains | (9) | (9) | |||||||||
| Adjusted EBITDA | $ | 739 | $ | 761 | |||||||
| Revenue | $ | 5,200 | $ | 5,350 | |||||||
| Net income margin | 7.6 | % | 7.7 | % | |||||||
| Adjusted EBITDA margin | 14.2 | % | 14.2 | % | |||||||
| Diluted EPS | $ | 7.27 | $ | 7.57 | |||||||
| Add: effect of amortization of intangible assets on diluted EPS | 1.10 | 1.10 | |||||||||
| Add: effect of divestiture-related gains on diluted EPS | (0.12) | (0.12) | |||||||||
| Adjusted diluted EPS | $ | 8.25 | $ | 8.55 | |||||||
| Cash flows from operating activities | $ | 485 | $ | 535 | |||||||
| Remove: purchases of property and equipment and capitalized software costs | (35) | (35) | |||||||||
| Free cash flow | $ | 450 | $ | 500 | |||||||
4
Maximus, Inc.
Consolidated Statements of Operations
(Unaudited)
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| March 31, 2026 | March 31, 2025 | March 31, 2026 | March 31, 2025 | ||||||||||||||||||||
| (in thousands, except per share amounts) | |||||||||||||||||||||||
| Revenue | $ | 1,305,967 | $ | 1,361,786 | $ | 2,651,013 | $ | 2,764,461 | |||||||||||||||
| Cost of revenue | 963,703 | 1,022,965 | 1,990,079 | 2,124,083 | |||||||||||||||||||
| Gross profit | 342,264 | 338,821 | 660,934 | 640,378 | |||||||||||||||||||
| Selling, general, and administrative expenses | 173,479 | 162,857 | 325,639 | 354,592 | |||||||||||||||||||
| Amortization of intangible assets | 20,298 | 22,996 | 40,598 | 46,031 | |||||||||||||||||||
| Operating income | 148,487 | 152,968 | 294,697 | 239,755 | |||||||||||||||||||
| Interest expense | 22,111 | 21,469 | 42,927 | 38,991 | |||||||||||||||||||
| Other (income)/expense, net | (158) | (963) | (1,031) | (651) | |||||||||||||||||||
| Income before income taxes | 126,534 | 132,462 | 252,801 | 201,415 | |||||||||||||||||||
| Provision for income taxes | 28,471 | 35,893 | 60,795 | 63,650 | |||||||||||||||||||
| Net income | $ | 98,063 | $ | 96,569 | $ | 192,006 | $ | 137,765 | |||||||||||||||
| Earnings per share: | |||||||||||||||||||||||
| Basic | $ | 1.81 | $ | 1.70 | $ | 3.52 | $ | 2.36 | |||||||||||||||
| Diluted | $ | 1.80 | $ | 1.69 | $ | 3.50 | $ | 2.35 | |||||||||||||||
| Weighted average shares outstanding: | |||||||||||||||||||||||
| Basic | 54,242 | 56,892 | 54,547 | 58,330 | |||||||||||||||||||
| Diluted | 54,585 | 57,057 | 54,925 | 58,553 | |||||||||||||||||||
| Dividends declared per share | $ | 0.33 | $ | 0.30 | $ | 0.63 | $ | 0.60 | |||||||||||||||
5
Maximus, Inc.
Consolidated Balance Sheets
| March 31, 2026 | September 30, 2025 | ||||||||||
| (unaudited) | |||||||||||
| (in thousands) | |||||||||||
| Assets: | |||||||||||
| Cash and cash equivalents | $ | 157,452 | $ | 222,351 | |||||||
| Accounts receivable, net | 1,114,960 | 898,095 | |||||||||
| Income taxes receivable | 64,792 | 3,904 | |||||||||
| Prepaid expenses and other current assets | 171,644 | 128,574 | |||||||||
| Total current assets | 1,508,848 | 1,252,924 | |||||||||
| Property and equipment, net | 27,178 | 30,972 | |||||||||
| Capitalized software, net | 202,583 | 214,260 | |||||||||
| Operating lease right-of-use assets | 84,097 | 100,514 | |||||||||
| Goodwill | 1,780,507 | 1,782,095 | |||||||||
| Intangible assets, net | 497,342 | 538,266 | |||||||||
| Deferred contract costs, net | 62,737 | 63,332 | |||||||||
| Deferred compensation plan assets | 58,472 | 63,272 | |||||||||
| Deferred income taxes | 7,590 | 11,491 | |||||||||
| Other assets | 9,820 | 12,513 | |||||||||
| Total assets | $ | 4,239,174 | $ | 4,069,639 | |||||||
| Liabilities and Shareholders' Equity: | |||||||||||
| Liabilities: | |||||||||||
| Accounts payable and accrued liabilities | $ | 281,984 | $ | 296,888 | |||||||
| Accrued compensation and benefits | 152,362 | 236,948 | |||||||||
| Deferred revenue, current portion | 37,910 | 53,784 | |||||||||
| Income taxes payable | 959 | 17,321 | |||||||||
| Long-term debt, current portion | 63,930 | 52,680 | |||||||||
| Operating lease liabilities, current portion | 35,400 | 38,605 | |||||||||
| Other current liabilities | 109,142 | 68,937 | |||||||||
| Total current liabilities | 681,687 | 765,163 | |||||||||
| Deferred revenue, non-current portion | 37,662 | 43,757 | |||||||||
| Deferred income taxes | 212,703 | 149,020 | |||||||||
| Long-term debt, non-current portion | 1,471,816 | 1,281,593 | |||||||||
| Deferred compensation plan liabilities, non-current portion | 58,171 | 62,145 | |||||||||
| Operating lease liabilities, non-current portion | 56,640 | 71,289 | |||||||||
| Other liabilities | 23,534 | 22,637 | |||||||||
| Total liabilities | 2,542,213 | 2,395,604 | |||||||||
| Shareholders' equity: | |||||||||||
Common stock, no par value; 100,000 shares authorized; 53,110 and 54,805 shares issued and outstanding as of March 31, 2026, and September 30, 2025, respectively | 639,269 | 628,118 | |||||||||
| Accumulated other comprehensive loss | (21,055) | (17,867) | |||||||||
| Retained earnings | 1,078,747 | 1,063,784 | |||||||||
| Total shareholders' equity | 1,696,961 | 1,674,035 | |||||||||
| Total liabilities and shareholders' equity | $ | 4,239,174 | $ | 4,069,639 | |||||||
6
Maximus, Inc.
Consolidated Statements of Cash Flows
(Unaudited)
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| March 31, 2026 | March 31, 2025 | March 31, 2026 | March 31, 2025 | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Cash flows from operating activities: | |||||||||||||||||||||||
| Net income | $ | 98,063 | $ | 96,569 | $ | 192,006 | $ | 137,765 | |||||||||||||||
| Adjustments to reconcile net income to cash flows from operations: | |||||||||||||||||||||||
| Depreciation and amortization of property, equipment, and capitalized software | 12,328 | 9,440 | 25,217 | 17,895 | |||||||||||||||||||
| Capitalized software impairment charges | 6,914 | — | 6,914 | — | |||||||||||||||||||
| Amortization of intangible assets | 20,298 | 22,996 | 40,598 | 46,031 | |||||||||||||||||||
| Amortization of debt issuance costs and debt discount | 736 | 672 | 1,472 | 1,310 | |||||||||||||||||||
| Deferred income taxes | 39,917 | (2,747) | 67,781 | (590) | |||||||||||||||||||
| Stock compensation expense | 9,899 | 12,623 | 16,918 | 19,575 | |||||||||||||||||||
| Divestiture-related charges/(gains) | — | 1,002 | (8,985) | 39,343 | |||||||||||||||||||
| Change in assets and liabilities, net of effects of business combinations and divestitures: | |||||||||||||||||||||||
| Accounts receivable | 30,710 | (131,428) | (222,665) | (234,882) | |||||||||||||||||||
| Prepaid expenses and other current assets | 6,054 | 10,443 | 5,963 | 7,943 | |||||||||||||||||||
| Deferred contract costs | 3,740 | (1,549) | 438 | (1,915) | |||||||||||||||||||
| Accounts payable and accrued liabilities | 19,569 | 14,093 | (14,238) | 5,943 | |||||||||||||||||||
| Accrued compensation and benefits | 27,269 | 45,035 | (73,431) | (48,001) | |||||||||||||||||||
| Deferred revenue | (10,759) | (3,061) | (21,602) | (11,293) | |||||||||||||||||||
| Income taxes | (73,428) | (18,541) | (74,463) | (6,465) | |||||||||||||||||||
| Operating lease right-of-use assets and liabilities | (1,074) | (14) | (1,473) | (2,363) | |||||||||||||||||||
| Other assets and liabilities | (710) | (12,819) | 4,674 | (7,578) | |||||||||||||||||||
| Net cash provided by/(used in) operating activities | 189,526 | 42,714 | (54,876) | (37,282) | |||||||||||||||||||
| Cash flows from investing activities: | |||||||||||||||||||||||
| Purchases of property and equipment and capitalized software | (10,509) | (17,206) | (16,772) | (40,198) | |||||||||||||||||||
| Proceeds from divestitures | — | — | 12,895 | 736 | |||||||||||||||||||
| Other | — | (2,165) | — | (2,165) | |||||||||||||||||||
| Net cash used in investing activities | (10,509) | (19,371) | (3,877) | (41,627) | |||||||||||||||||||
| Cash flows from financing activities: | |||||||||||||||||||||||
| Cash dividends paid to Maximus shareholders | (17,821) | (16,901) | (34,159) | (34,961) | |||||||||||||||||||
| Purchases of Maximus common stock | (114,440) | (77,850) | (155,002) | (306,443) | |||||||||||||||||||
| Tax withholding related to RSU vesting | — | — | (17,325) | (16,441) | |||||||||||||||||||
| Payments for debt financing costs | — | (1,658) | — | (1,658) | |||||||||||||||||||
| Proceeds from borrowings | 300,000 | 524,000 | 665,000 | 959,000 | |||||||||||||||||||
| Principal payments for debt | (332,500) | (418,375) | (465,000) | (597,639) | |||||||||||||||||||
| Other, including customer escrowed funds | 51,484 | (282) | 50,109 | (1,181) | |||||||||||||||||||
| Net cash (used in)/provided by financing activities | (113,277) | 8,934 | 43,623 | 677 | |||||||||||||||||||
| Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (568) | 791 | (632) | (1,593) | |||||||||||||||||||
| Net change in cash, cash equivalents, and restricted cash | 65,172 | 33,068 | (15,762) | (79,825) | |||||||||||||||||||
| Cash, cash equivalents, and restricted cash, beginning of period | 179,525 | 122,870 | 260,459 | 235,763 | |||||||||||||||||||
| Cash, cash equivalents, and restricted cash, end of period | $ | 244,697 | $ | 155,938 | $ | 244,697 | $ | 155,938 | |||||||||||||||
7
Maximus, Inc.
Consolidated Results of Operations by Segment
(Unaudited)
| For the Three Months Ended March 31, 2026 | |||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | U.S. Federal Services | % (1 ) | U.S. Services | % (1 ) | Outside the U.S. | % (1 ) | Total | ||||||||||||||||||||||||||||||||||
| Revenue | $ | 753,143 | $ | 415,754 | $ | 137,070 | $ | 1,305,967 | |||||||||||||||||||||||||||||||||
| Cost of revenue | 527,698 | 70.1 | % | 315,245 | 75.8 | % | 120,760 | 88.1 | % | 963,703 | |||||||||||||||||||||||||||||||
| Gross profit | 225,445 | 29.9 | % | 100,509 | 24.2 | % | 16,310 | 11.9 | % | 342,264 | |||||||||||||||||||||||||||||||
| Other segment items (2) | 92,741 | 12.3 | % | 61,919 | 14.9 | % | 19,395 | 14.1 | % | 174,055 | |||||||||||||||||||||||||||||||
| Segment operating income/(loss) | $ | 132,704 | 17.6 | % | $ | 38,590 | 9.3 | % | $ | (3,085) | (2.3) | % | 168,209 | ||||||||||||||||||||||||||||
| Other (4) | 576 | ||||||||||||||||||||||||||||||||||||||||
| Amortization of intangible assets | (20,298) | ||||||||||||||||||||||||||||||||||||||||
| Operating income | $ | 148,487 | |||||||||||||||||||||||||||||||||||||||
| For the Three Months Ended March 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | U.S. Federal Services | % (1) | U.S. Services | % (1) | Outside the U.S. | % (1) | Total | ||||||||||||||||||||||||||||||||||
| Revenue | $ | 777,927 | 1 | $ | 442,350 | $ | 141,509 | $ | 1,361,786 | ||||||||||||||||||||||||||||||||
| Cost of revenue | 575,869 | 74.0 | % | 330,580 | 74.7 | % | 116,516 | 82.3 | % | 1,022,965 | |||||||||||||||||||||||||||||||
| Gross profit | 202,058 | 26.0 | % | 111,770 | 25.3 | % | 24,993 | 17.7 | % | 338,821 | |||||||||||||||||||||||||||||||
| Other segment items (2) | 83,076 | 10.7 | % | 57,963 | 13.1 | % | 20,197 | 14.3 | % | 161,236 | |||||||||||||||||||||||||||||||
| Segment operating income | $ | 118,982 | 15.3 | % | $ | 53,807 | 12.2 | % | $ | 4,796 | 3.4 | % | 177,585 | ||||||||||||||||||||||||||||
| Divestiture-related gains/(charges) (3) | (1,002) | ||||||||||||||||||||||||||||||||||||||||
| Other (4) | (619) | ||||||||||||||||||||||||||||||||||||||||
| Amortization of intangible assets | (22,996) | ||||||||||||||||||||||||||||||||||||||||
| Operating income | $ | 152,968 | |||||||||||||||||||||||||||||||||||||||
8
| For the Six Months Ended March 31, 2026 | |||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | U.S. Federal Services | % (1) | U.S. Services | % (1) | Outside the U.S. | % (1) | Total | ||||||||||||||||||||||||||||||||||
| Revenue | $ | 1,539,744 | 1 | $ | 831,002 | $ | 280,267 | $ | 2,651,013 | ||||||||||||||||||||||||||||||||
| Cost of revenue | 1,099,364 | 71.4 | % | 646,099 | 77.7 | % | 244,616 | 87.3 | % | 1,990,079 | |||||||||||||||||||||||||||||||
| Gross profit | 440,380 | 28.6 | % | 184,903 | 22.3 | % | 35,651 | 12.7 | % | 660,934 | |||||||||||||||||||||||||||||||
| Other segment items (2) | 177,943 | 11.6 | % | 117,027 | 14.1 | % | 40,116 | 14.3 | % | 335,086 | |||||||||||||||||||||||||||||||
| Segment operating income | $ | 262,437 | 17.0 | % | $ | 67,876 | 8.2 | % | $ | (4,465) | (1.6) | % | 325,848 | ||||||||||||||||||||||||||||
| Divestiture-related gains/(charges) (3) | 8,985 | ||||||||||||||||||||||||||||||||||||||||
| Other (4) | 462 | ||||||||||||||||||||||||||||||||||||||||
| Amortization of intangible assets | (40,598) | ||||||||||||||||||||||||||||||||||||||||
| Operating income | $ | 294,697 | |||||||||||||||||||||||||||||||||||||||
| For the Six Months Ended March 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | U.S. Federal Services | % (1) | U.S. Services | % (1) | Outside the U.S. | % (1) | Total | ||||||||||||||||||||||||||||||||||
| Revenue | $ | 1,558,582 | $ | 894,600 | $ | 311,279 | $ | 2,764,461 | |||||||||||||||||||||||||||||||||
| Cost of revenue | 1,183,209 | 75.9 | % | 687,826 | 76.9 | % | 253,048 | 81.3 | % | 2,124,083 | |||||||||||||||||||||||||||||||
| Gross profit | 375,373 | 24.1 | % | 206,774 | 23.1 | % | 58,231 | 18.7 | % | 640,378 | |||||||||||||||||||||||||||||||
| Other segment items (2) | 157,291 | 10.1 | % | 112,121 | 12.5 | % | 45,315 | 14.6 | % | 314,727 | |||||||||||||||||||||||||||||||
| Segment operating income | $ | 218,082 | 14.0 | % | $ | 94,653 | 10.6 | % | $ | 12,916 | 4.1 | % | 325,651 | ||||||||||||||||||||||||||||
| Divestiture-related gains/(charges) (3) | (39,343) | ||||||||||||||||||||||||||||||||||||||||
| Other (4) | (522) | ||||||||||||||||||||||||||||||||||||||||
| Amortization of intangible assets | (46,031) | ||||||||||||||||||||||||||||||||||||||||
| Operating income | $ | 239,755 | |||||||||||||||||||||||||||||||||||||||
(1)Percentage of respective revenue, as applicable.
(2)Other segment items are principally selling, general, and administrative expenses allocated to segments.
(3)During fiscal years 2026 and 2025, we divested businesses from our U.S. Services and Outside the U.S. Segments, respectively.
(4)Other expenses include credits and costs that are not allocated to a particular segment.
9
Maximus, Inc.
Consolidated Free Cash Flows - Non-GAAP
(Unaudited)
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| March 31, 2026 | March 31, 2025 | March 31, 2026 | March 31, 2025 | ||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||
| Net cash provided by/(used in) operating activities | 189,526 | 42,714 | (54,876) | (37,282) | |||||||||||||||||||
| Purchases of property and equipment and capitalized software | (10,509) | (17,206) | (16,772) | (40,198) | |||||||||||||||||||
| Free cash flow (Non-GAAP) | $ | 179,017 | $ | 25,508 | $ | (71,648) | $ | (77,480) | |||||||||||||||
Maximus, Inc.
Non-GAAP Adjusted Results - Adjusted EBITDA, Adjusted Net Income, and Adjusted Diluted Earnings per Share
(Unaudited)
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| March 31, 2026 | March 31, 2025 | March 31, 2026 | March 31, 2025 | ||||||||||||||||||||
| (dollars in thousands, except per share data) | |||||||||||||||||||||||
| Net income | $ | 98,063 | $ | 96,569 | $ | 192,006 | $ | 137,765 | |||||||||||||||
| Provision for income taxes | 28,471 | 35,893 | 60,795 | 63,650 | |||||||||||||||||||
| Interest expense | 22,111 | 21,469 | 42,927 | 38,991 | |||||||||||||||||||
| Other (income)/expense, net | (158) | (963) | (1,031) | (651) | |||||||||||||||||||
| Amortization of intangible assets | 20,298 | 22,996 | 40,598 | 46,031 | |||||||||||||||||||
| Divestiture-related charges/(gains) | — | 1,002 | (8,985) | 39,343 | |||||||||||||||||||
| Depreciation and amortization of property, equipment, and capitalized software | 12,328 | 9,440 | 25,217 | 17,895 | |||||||||||||||||||
| Capitalized software impairment charges | 6,914 | — | 6,914 | — | |||||||||||||||||||
| Adjusted EBITDA (Non-GAAP) | $ | 188,027 | $ | 186,406 | $ | 358,441 | $ | 343,024 | |||||||||||||||
| Net income margin (GAAP)* | 7.5 | % | 7.1 | % | 7.2 | % | 5.0 | % | |||||||||||||||
| Adjusted EBITDA margin (Non-GAAP)* | 14.4 | % | 13.7 | % | 13.5 | % | 12.4 | % | |||||||||||||||
| * Margins are calculated as a percentage of revenue | |||||||||||||||||||||||
| Net income | $ | 98,063 | $ | 96,569 | $ | 192,006 | $ | 137,765 | |||||||||||||||
| Add back: Amortization of intangible assets, net of tax | 14,960 | 16,948 | 29,921 | 33,925 | |||||||||||||||||||
| Add back: Divestiture-related charges/(gains), net of tax | — | 1,002 | (6,622) | 39,343 | |||||||||||||||||||
| Adjusted net income excluding amortization of intangible assets and divestiture-related adjustments (Non-GAAP) | $ | 113,023 | $ | 114,519 | $ | 215,305 | $ | 211,033 | |||||||||||||||
| Diluted earnings per share | $ | 1.80 | $ | 1.69 | $ | 3.50 | $ | 2.35 | |||||||||||||||
| Add back: Effect of amortization of intangible assets on diluted earnings per share | 0.27 | 0.30 | 0.54 | 0.58 | |||||||||||||||||||
| Add back: Effect of divestiture-related charges/(gains) on diluted earnings per share | — | 0.02 | (0.12) | 0.67 | |||||||||||||||||||
| Adjusted diluted earnings per share excluding amortization of intangible assets and divestiture-related adjustments (Non-GAAP) | $ | 2.07 | $ | 2.01 | $ | 3.92 | $ | 3.60 | |||||||||||||||
10
FAQ
How did Maximus (MMS) perform financially in Q2 2026?
Maximus generated revenue of $1.31 billion and net income of $98.1 million in Q2 2026. Diluted EPS was $1.80, with adjusted diluted EPS of $2.07, both up from $1.69 and $2.01 a year earlier as margins improved despite lower revenue.
Did Maximus (MMS) change its fiscal 2026 earnings guidance?
Yes. Maximus raised its 2026 adjusted EBITDA margin guidance by 20 basis points to about 14.2% and increased adjusted diluted EPS guidance to a range of $8.25 to $8.55. Revenue guidance remains $5.2–$5.35 billion, and free cash flow guidance stays at $450–$500 million.
What is Maximus (MMS) expecting for 2026 revenue and free cash flow?
For fiscal 2026, Maximus reaffirmed revenue guidance of $5.2–$5.35 billion and free cash flow of $450–$500 million. These targets accompany the raised earnings outlook, reflecting management’s view that profitability can improve without changing the existing top-line forecast.
How is Maximus (MMS) using AI and technology in its operations?
Management attributes margin gains partly to automation and AI-enabled tools that increase processing efficiency without matching labor cost growth. These technology initiatives supported Q2 2026 adjusted EBITDA margin of 14.4% and underpin the higher full-year margin guidance provided.
What is Maximus (MMS) doing with its dividend in 2026?
Maximus declared a quarterly cash dividend of $0.33 per share, payable June 1, 2026, to shareholders of record on May 15, 2026. This maintains a regular cash return to shareholders alongside the expanded share repurchase program and reflects ongoing cash generation.