Mercury Systems Inc. is a leading provider of secure processing and storage solutions for aerospace and defense applications. The company specializes in designing and manufacturing advanced technology systems that enable mission-critical operations, particularly in embedded processing for various defense platforms. With a focus on innovative, high-performance solutions, Mercury Systems supports military and defense customers by delivering hardware and software that enhance the capabilities of their systems while also ensuring data security and reliability. The company is committed to advancing the state of technology in the defense sector, contributing to a safer and more secure global environment. Read More
As the Q2 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the defense contractors industry, including Parsons (NYSE:PSN) and its peers.
A number of stocks fell in the afternoon session after an unexpectedly sharp rise in wholesale inflation fueled concerns about rising costs and their impact on corporate profits. The primary catalyst was the July 2025 Producer Price Index (PPI), a measure of inflation at the wholesale level, which jumped 0.9% against forecasts of a 0.2% rise. This represents the most significant monthly increase in over three years, pointing to mounting cost pressures for manufacturers, with tariffs cited as a key factor. This data complicates the Federal Reserve's upcoming interest rate decisions, as persistent inflation may prevent rate cuts, creating a headwind for cyclical sectors like Industrials.
Mercury Systems brings state-of-the-art commercial technology to U.S. and international defense frontlines, efficiently, effectively, and with excellence.
Stocks set fresh highs after July CPI held steady at 2.7%. Airlines surged on an airfare rebound, while a handful of earnings headlines put single‑stock risk front and center.
Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at BWX (NYSE:BWXT) and its peers.
Shares of aerospace and defense company Mercury Systems (NASDAQ:MRCY)
jumped 24.9% in the afternoon session after the company reported second-quarter 2025 results that significantly beat Wall Street's expectations for both revenue and profitability. The aerospace and defense firm announced revenue of $273.1 million, a 9.9% year-on-year increase that surpassed analyst estimates of $244.2 million. The company's bottom line was even more impressive, with adjusted earnings per share of $0.47, more than double the consensus forecast of $0.22. This strong performance was also reflected in its operational efficiency, as its operating margin improved to 8.6% from a negative 3.2% in the same period last year. Additionally, Mercury Systems reported a healthy backlog of $1.4 billion, indicating a solid pipeline of future business.
Aerospace and defense company Mercury Systems (NASDAQ:MRCY) reported revenue ahead of Wall Street’s expectations in Q2 CY2025, with sales up 9.9% year on year to $273.1 million. Its non-GAAP profit of $0.47 per share was significantly above analysts’ consensus estimates.
Aerospace and defense company Mercury Systems (NASDAQ:MRCY) reported revenue ahead of Wall Street’s expectations in Q2 CY2025, with sales up 9.9% year on year to $273.1 million. Its non-GAAP profit of $0.47 per share was significantly above analysts’ consensus estimates.
Many small-cap stocks have limited Wall Street coverage, giving savvy investors the chance to act before everyone else catches on.
But the flip side is that these businesses have increased downside risk because they lack the scale and staying power of their larger competitors.
PALM BEACH, Fla., July 24, 2025 (GLOBE NEWSWIRE) -- FN Media Group News Commentary - A recent release from the Department of Defense (DOD) said that: “The Pentagon to Increase Low-Cost Drone Production in U.S. It said that the Defense Department, with help from industry, will ramp up production and fielding of drones to maintain battlefield superiority. Recently at the Pentagon, 18 American-made drone prototypes were on display. Defense Secretary Pete Hegseth, who toured the displays, said the drones that are manufactured using off-the-shelf components for rapid production are examples of disruptive thinking. Emil Michael, undersecretary of defense for research and engineering, said the prototypes on display went from concept to development in just an average of 18 months, a process that normally takes up to six years. The department will continue to rapidly innovate and scale up production of drones and other systems using cost, resilience, firepower and range as driving factors, which are areas DOD wants to improve upon," Michael said. Hegseth said in a July 10, 2025, memorandum that he's rescinding restrictive policies that hindered drone production. "Drones are the biggest battlefield innovation in a generation, accounting for most of this year's casualties in Ukraine. Our adversaries collectively produce millions of cheap drones each year," he said, noting the U.S. military is lacking needed quantities of lethal small drones. Active Companies in the drone industries include ZenaTech, Inc. (NASDAQ: ZENA), Mercury Systems, Inc. (NASDAQ: MRCY), Safe Pro Group Inc. (NASDAQ: SPAI), RTX Corporation (NYSE: RTX), AIRO Group Holdings, Inc. (NASDAQ: AIRO).
Expensive stocks often command premium valuations because the market thinks their business models are exceptional.
However, the downside is that high expectations are already baked into their prices, leaving little room for error if they stumble even slightly.
Even if they go mostly unnoticed, industrial businesses are the backbone of our country. But they are at the whim of volatile macroeconomic factors that sway capital spending, like interest rates.
Wariness surrounding these influences has caused the industry to underperform the market as it was flat over the past six months while the S&P 500 climbed by 4.1%.
As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at defense contractors stocks, starting with Mercury Systems (NASDAQ:MRCY).
Shares of aerospace and defense company Mercury Systems (NASDAQ:MRCY)
jumped 3.6% in the afternoon session after the company announced it signed two agreements with a major European defense prime contractor to expand and accelerate the production of critical technology for radar and electronic warfare missions.
Stability is great, but low-volatility stocks may struggle to deliver market-beating returns over time as they sometimes underperform during bull markets.
