Amentum Holdings, Inc.
For the period ended Jun 27, 2025. Filed Aug 6, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 27, 2025 · Filed Aug 6, 2025
AMTM$21.25-0.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-28; filed 2025-05-07.
0002011286-25-000141
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-27; filed 2025-08-06.
0002011286-25-000163
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 83 previous paragraphs and 87 current paragraphs.
52 unchanged; 27 reworded; 6 added; 3 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 6 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (6)
Current report
On July 4, 2025, the One Big, Beautiful Bill Act was passed which made certain tax cuts permanent, reduced healthcare spending and increased spending related to border security, defense and energy production. The bill included $150 billion in additional defense spending and $133 billion in supplemental spending for border security to be spent over the next two years and also added $10 billion in new spending for NASA’s human spaceflight programs and infrastructure modernization.
Current report
Loss on extinguishment of debt — The loss on extinguishment of debt for the three months ended June 27, 2025 and June 28, 2024 was due to a $191 million voluntary principal payment on the Term Loan and a $150 million voluntary principal payment on the previous Second Lien Tranche 1 Term Facility, respectively.
Current report
Results of Operations for the Nine Months Ended June 27, 2025 and June 28, 2024
Current report
Loss on extinguishment of debt — The loss on extinguishment of debt for the nine months ended June 27, 2025 and June 28, 2024 was due to a $191 million voluntary principal payment on the Term Loan and a $150 million voluntary principal payment on the previous Second Lien Tranche 1 Term Facility, respectively.
Current report
Net cash provided by investing activities increased by $244 million for the nine months ended June 27, 2025 when compared to the nine months ended June 28, 2024 primarily due to the sale of the Rapid Solutions business partially offset by the cash payment made as part of the Transaction based on the final net working capital position.
Removed paragraphs (3)
Previous report
Results of Operations for the Six Months Ended March 28, 2025 and March 29, 2024
Previous report
Net cash used in investing activities increased by $33 million for the six months ended March 28, 2025 when compared to the six months ended March 29, 2024 as a result of increased contributions to equity method investments.
Previous report
Divestiture of Rapid Solutions
Reworded paragraphs (27)
Previous wording
We conduct our business activities and report financial results as two business segments: Digital Solutions (“DS”) and Global Engineering Solutions (“GES”). DS provides advanced digital and data-driven solutions including intelligence analytics, space system development, cybersecurity, and next generation IT across the federal government and commercial clients. GES provides large-scale environmental remediation, clean energy, platform engineering, sustainment and supply chain management across all 7 continents for the U.S. government and allied nations.
Current wording
We conduct our business activities and report financial results as two business segments: Digital Solutions (“DS”) and Global Engineering Solutions (“GES”). The DS segment provides advanced digital and data-driven solutions including intelligence analytics, space system development, cybersecurity, and next generation IT across the federal government and commercial clients. The GES segment provides large-scale environmental remediation, clean energy, platform engineering, sustainment and supply chain management across all 7 continents for the U.S. government and allied nations.
Previous wording
The U.S. federal government fiscal year (“GFY”) 2025 appropriations bill was passed in March 2025. The final bill provided a 1% increase for defense discretionary spending to $892 billion and a 1% increase in non-defense discretionary spending to $708 billion. The GFY 2026 “skinny” budget request was submitted to Congress on May 2, 2025, and if enacted, would maintain defense discretionary spending at $892 billion and reduce non-defense discretionary spending by approximately 21% to $557 billion. Additionally, the skinny budget request assumes an increase in defense spending based on the defense reconciliation legislation currently pending in Congress, which would result in total GFY 2026 defense spending of $1.01 trillion, an increase of 13% from the GFY 2025 enacted level.
Current wording
The U.S. federal government fiscal year (“GFY”) 2025 appropriations bill was passed in March 2025. The bill provided a 1% increase for defense discretionary spending to $892 billion and a 1% increase in non-defense discretionary spending to $708 billion. The President’s GFY 2026 budget request was submitted to Congress on May 2, 2025, and if enacted, would maintain defense discretionary spending at $892 billion and reduce non-defense discretionary spending by approximately 21% to $557 billion. Additionally, the budget request assumes an increase in defense spending based on the defense reconciliation legislation, which would result in total GFY 2026 defense spending of $1.01 trillion, an increase of 13% from the GFY 2025 enacted level.
Previous wording
Under the Trump administration, the Department of Government Efficiency (“DOGE”) was created to propose savings through improvements to technology and increases to productivity in the federal workforce; we continue to monitor the actions of the new administration which could result in a change to budgetary priorities or impact federal government procurement timing. Although a limited number of our contracts for the U.S. Government have been affected by DOGE and other changes in budgetary priorities by the new administration, the impact has not been material to date.
Current wording
Under the Trump administration, the Department of Government Efficiency (“DOGE”) was created to propose savings through improvements to technology and increases to productivity in the federal workforce; we continue to monitor the actions of the new administration which could result in a change to budgetary priorities or impact federal government procurement timing.
Previous wording
Cost of revenues — The increase in cost of revenues was primarily attributable to the increased revenues volume from the merger with CMS. As a percentage of revenues, cost of revenues was 89.5% for the three months ended March 28, 2025 compared to 90.2% for the three months ended March 29, 2024.
Current wording
Cost of revenues — The increase in cost of revenues was primarily attributable to the increased revenues volume from the merger with CMS. As a percentage of revenues, cost of revenues was 89.7% for the three months ended June 27, 2025 compared to 90.4% for the three months ended June 28, 2024.
Previous wording
Selling, general, and administrative expenses (“SG&A”) — The increase in SG&A was primarily attributable to the merger with CMS. SG&A as a percentage of revenues increased to 4.2% for the three months ended March 28, 2025 from 3.5% for the three months ended March 29, 2024 primarily due to the merger with CMS and an increase in acquisition, transaction and integration costs.
Current wording
Selling, general, and administrative expenses (“SG&A”) — The increase in SG&A was primarily attributable to the merger with CMS. SG&A as a percentage of revenues increased to 4.6% for the three months ended June 27, 2025 from 3.6% for the three months ended June 28, 2024 primarily due to the merger with CMS and an increase in acquisition, transaction and integration costs.
Previous wording
Provision for income taxes — The effective tax rate for the three months ended March 28, 2025 was 91.7%, as compared to (90.9)% for the three months ended March 29, 2024. The change in the effective tax rate was primarily due to the recognition of a valuation allowance against a disallowed interest expense deferred tax asset relative to income (loss) before income taxes in the respective period.
Current wording
Provision for income taxes — The effective tax rate for the three months ended June 27, 2025 was 108.3%, as compared to (9.1)% for the three months ended June 28, 2024. The change in the effective tax rate was primarily due to the recognition of a valuation allowance against a disallowed interest expense deferred tax asset relative to income (loss) before income taxes in the respective period.
Previous wording
Cost of revenues — The increase in cost of revenues was primarily attributable to the increased revenues volume from the merger with CMS. As a percentage of revenues, cost of revenues was 89.5% for the six months ended March 28, 2025 compared to 90.2% for the six months ended March 29, 2024.
Current wording
Cost of revenues — The increase in cost of revenues was primarily attributable to the increased revenues volume from the merger with CMS. As a percentage of revenues, cost of revenues was 89.5% for the nine months ended June 27, 2025 compared to 90.3% for the nine months ended June 28, 2024.
Previous wording
Selling, general, and administrative expenses (“SG&A”) — The increase in SG&A was primarily attributable to the merger with CMS. SG&A as a percentage of revenues increased to 4.0% for the six months ended March 28, 2025 from 3.4% for the six months ended March 29, 2024 primarily due to the merger with CMS and an increase in acquisition, transaction and integration costs.
Current wording
Selling, general, and administrative expenses (“SG&A”) — The increase in SG&A was primarily attributable to the merger with CMS. SG&A as a percentage of revenues increased to 4.2% for the nine months ended June 27, 2025 from 3.5% for the nine months ended June 28, 2024 primarily due to the merger with CMS and an increase in acquisition, transaction and integration costs.
Previous wording
Equity earnings of non-consolidated subsidiaries — Equity earnings of non-consolidated subsidiaries include our proportionate share of the income from equity method investments and increased due to non-consolidated subsidiaries obtained in the merger with CMS, partially offset by the utilization of fair market value adjustments assigned to certain equity method investments based on the remaining period of performance for the related contract.
Current wording
Equity earnings of non-consolidated subsidiaries — Equity earnings of non-consolidated subsidiaries include our proportionate share of the income from equity method investments partially offset by the utilization of fair market value adjustments assigned to certain equity method investments based on the remaining period of performance for the related contract and was consistent with the nine months ended June 28, 2024.
Previous wording
Interest expense and other, net — The decrease in interest expense and other, net was primarily due to the reduction to our term loan principal balance as compared to the six months ended March 29, 2024 combined with a decrease in interest rates, partially offset by the interest incurred on our Senior Notes during the six months ended March 28, 2025.
Current wording
Interest expense and other, net — The decrease in interest expense and other, net was primarily due to the reduction to our term loan principal balance as compared to the nine months ended June 28, 2024 combined with a decrease in interest rates, partially offset by the interest incurred on our Senior Notes during the nine months ended June 27, 2025.
Previous wording
Provision for income taxes — The effective tax rate for the six months ended March 28, 2025 was 66.7%, as compared to (72.3)% for the six months ended March 29, 2024. The change in the effective tax rate was primarily due to the recognition of a valuation allowance against a disallowed interest expense deferred tax asset relative to income (loss) before income taxes in the respective period.
Current wording
Provision for income taxes — The effective tax rate for the nine months ended June 27, 2025 was 72.8%, as compared to (52.2)% for the nine months ended June 28, 2024. The change in the effective tax rate was primarily due to the recognition of a valuation allowance against a disallowed interest expense deferred tax asset relative to income (loss) before income taxes in the respective period.
Previous wording
Net income (loss) attributable to non-controlling interests — Net income (loss) attributable to non-controlling interests include the minority interests in our consolidated joint ventures that are not wholly-owned partially offset by the utilization of fair market value adjustments assigned to certain non-controlling interests based on the remaining period of performance for the related contract.
Current wording
Net income (loss) attributable to non-controlling interests — Net income (loss) attributable to non-controlling interests includes the utilization of fair market value adjustments assigned to certain non-controlling interests based on the remaining period of performance for the related contract partially offset by the minority interests in our consolidated joint ventures that are not wholly-owned.
Previous wording
Segment Results for the Three and Six Months Ended March 28, 2025 and March 29, 2024
Current wording
Segment Results for the Three and Nine Months Ended June 27, 2025 and June 28, 2024
Previous wording
The increase in revenues for the three and six months ended March 28, 2025, as compared to the three and six months ended March 29, 2024, was primarily attributable to revenues from the merger with CMS and higher volume from new contract awards, partially offset by the expected ramp-down of other historical programs.
Current wording
The increase in revenues for the three and nine months ended June 27, 2025, as compared to the three and nine months ended June 28, 2024, was primarily attributable to revenues from the merger with CMS, higher volume from new contract awards and growth on existing programs, partially offset by the expected ramp-down of historical programs.
Previous wording
The increase in Adjusted EBITDA for the three and six months ended March 28, 2025, as compared to the three and six months ended March 29, 2024, was primarily attributable to the revenue growth factors described above.
Current wording
The increase in Adjusted EBITDA for the three and nine months ended June 27, 2025, as compared to the three and nine months ended June 28, 2024, was primarily attributable to the revenue growth factors described above.
Previous wording
The increase in revenues for the three and six months ended March 28, 2025, as compared to the three and six months ended March 29, 2024, was primarily attributable to revenues from the merger with CMS, the ramp up of new contract awards and growth on existing programs, partially offset by the expected ramp-down of other historical programs.
Current wording
The increase in revenues for the three and nine months ended June 27, 2025, as compared to the three and nine months ended June 28, 2024, was primarily attributable to revenues from the merger with CMS, the ramp up of new contract awards and growth on existing programs, partially offset by the expected ramp-down of historical programs.
Previous wording
The increase in Adjusted EBITDA for the three and six months ended March 28, 2025, as compared to the three and six months ended March 29, 2024, was primarily attributable to the revenue growth factors described above.
Current wording
The increase in Adjusted EBITDA for the three and nine months ended June 27, 2025, as compared to the three and nine months ended June 28, 2024, was primarily attributable to the revenue growth factors described above and improved operational performance.
Previous wording
As of March 28, 2025, the Company had total backlog of $44.8 billion, compared with $27.2 billion as of March 29, 2024, an increase of $17.6 billion primarily due to the merger with CMS. Funded backlog as of March 28, 2025 was $5.8 billion.
Current wording
As of June 27, 2025, the Company had total backlog of $44.6 billion, compared with $26.9 billion as of June 28, 2024, an increase of $17.7 billion primarily due to the merger with CMS. Funded backlog as of June 27, 2025 was $5.6 billion.
Previous wording
Given the nature of our operations and contract type mix, we expect the impact of inflation on our business may be limited for some of our contracts. During the six months ended March 28, 2025, 64% of our revenues was generated under cost-plus-fee type contracts that have limited inflation risk as they include provisions that adjust revenues to cover costs affected by inflation. The remainder of our revenues was generated under time-and-materials or fixed-price type contracts which we have historically been able to price in a manner that accommodates inflation and cost increases over the period of performance but changes in our expectations with respect to inflation rates or in the overall mix of our contract types could cause future results to differ substantially.
Current wording
Given the nature of our operations and contract type mix, we expect the impact of inflation on our business may be limited for some of our contracts. During the nine months ended June 27, 2025, 64% of our revenues was generated under cost-plus-fee type contracts that have limited inflation risk as they include provisions that adjust revenues to cover costs affected by inflation. The remainder of our revenues was generated under time-and-materials or fixed-price type contracts which we have historically been able to price in a manner that accommodates inflation and cost increases over the period of performance but changes in our expectations with respect to inflation rates or in the overall mix of our contract types could cause future results to differ substantially.
Previous wording
The Credit Facility consists of a seven year, $3,750 million term facility (“Term Loan”) and a five year, $850 million revolving facility (“Revolver”), including a $200 million letter of credit subfacility and a $100 million swingline subfacility. The Revolver and the Term Loan mature on September 27, 2029 and September 27, 2031, respectively. The Term Loan requires quarterly principal amortization payments of $9 million commencing March 31, 2025 with the remainder of the principal thereunder being due at maturity. In August 2024, the Company also completed an offering of $1,000 million in aggregate principal amount of 7.250% senior notes due August 1, 2032 (the “Senior Notes”).
Current wording
The Credit Facility consists of a seven year, $3,750 million term facility (“Term Loan”) and a five year, $850 million revolving facility (“Revolver”), including a $200 million letter of credit subfacility and a $100 million swingline subfacility. The Revolver and the Term Loan mature on September 27, 2029 and September 27, 2031, respectively. The Term Loan requires quarterly principal amortization payments of $9 million, which commenced on March 31, 2025, with the remainder of the principal thereunder being due at maturity. In August 2024, the Company also completed an offering of $1,000 million in aggregate principal amount of 7.250% senior notes due August 1, 2032 (the “Senior Notes”).
Previous wording
The New Credit Facility and the Senior Notes are guaranteed by substantially all of our wholly owned material domestic restricted subsidiaries, subject to customary exceptions set forth in the credit agreement and indenture, respectively.
Current wording
The Credit Facility and the Senior Notes are guaranteed by substantially all of our wholly owned material domestic restricted subsidiaries, subject to customary exceptions set forth in the credit agreement and indenture, respectively.
Previous wording
The interest rates applicable to the Term Loan are floating interest rates equal to an Alternate Base Rate or Adjusted Term Secured Overnight Financing Rate plus an applicable margin based upon net leverage ratio.
Current wording
The interest rates applicable to the Term Loan are floating interest rates equal to an Alternate Base Rate or Adjusted Term Secured Overnight Financing Rate plus an applicable margin based upon our net leverage ratio.
Previous wording
On April 23, 2025, we entered into a definitive agreement to sell our hardware and product business, Rapid Solutions, to Lockheed Martin for a purchase price of $360 million in cash, subject to regulatory approvals and customary closing conditions. Certain proceeds from the planned sale of the Rapid Solutions business are expected to be used to accelerate our debt reduction objectives.
Current wording
On June 26, 2025, we completed the sale of a hardware and product business, Rapid Solutions, to Lockheed Martin Corporation for a purchase price of $360 million in cash.
Previous wording
Over the longer term, our ability to generate sufficient cash flows from operations necessary to fulfill the obligations under the Credit Facility, Senior Notes and any other indebtedness we may incur will depend on our future financial performance which could be affected by factors outside of our control, including worldwide economic and financial market conditions.
Current wording
As part of our debt reduction initiatives, we made voluntary principal payments on the Term Loan of approximately $191 million and $250 million on June 27, 2025 and July 31, 2025, respectively. Over the longer term, our ability to generate sufficient cash flows from operations necessary to fulfill the obligations under the Credit Facility, Senior Notes and any other indebtedness we may incur will depend on our future financial performance which could be affected by factors outside of our control, including, but not limited to, worldwide economic and financial market conditions.
Previous wording
Net cash provided by operating activities increased by $245 million for the six months ended March 28, 2025 when compared to the six months ended March 29, 2024 as a result of a $235 million increase in cash earnings due to contributions from the merger with CMS and from $10 million in favorable changes in operating assets and liabilities driven by reduced interest payments.
Current wording
Net cash provided by operating activities increased by $113 million for the nine months ended June 27, 2025 when compared to the nine months ended June 28, 2024 as a result of a $289 million increase in cash earnings due to contributions from the merger with CMS and offset by $176 million in changes in operating assets and liabilities.
Previous wording
Net cash used in financing activities for the six months ended March 28, 2025 remained consistent when compared to the six months ended March 29, 2024 primarily as a result of distributions to non-controlling interests and the absence of quarterly principal amortization payments on our Term Loan, which commence in the third quarter of fiscal year 2025.
Current wording
Net cash used in financing activities increased by $42 million for the nine months ended June 27, 2025 when compared to the nine months ended June 28, 2024 primarily due to increased principal payments on our Term Loan and distributions to non-controlling interests.
Previous wording
On April 23, 2025, we entered into a definitive agreement to sell our hardware and product business, Rapid Solutions, to Lockheed Martin for a purchase price of $360 million in cash, subject to regulatory approvals and customary closing conditions. The planned sale of the Rapid Solutions business is not classified as discontinued operations as it does not represent a strategic shift in our business.
Current wording
On June 26, 2025, we completed the sale of a hardware and product business, Rapid Solutions, to Lockheed Martin Corporation for a purchase price of $360 million in cash. The sale of Rapid Solutions, which was part of the DS segment, was not classified as discontinued operations as it did not represent a strategic shift in our business.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Although a limited number of our contracts for the U.S. Government have been affected by DOGE and other changes in budgetary priorities by the new administration, the impact has not been material to date.
Current report — wording carried from elsewhere
Equity earnings of non-consolidated subsidiaries — Equity earnings of non-consolidated subsidiaries include our proportionate share of the income from equity method investments and was consistent with the three months ended June 28, 2024.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Equity earnings of non-consolidated subsidiaries — Equity earnings of non-consolidated subsidiaries include our proportionate share of the income from equity method investments and increased due to non-consolidated subsidiaries obtained in the merger with CMS, partially offset by the utilization of fair market value adjustments assigned to certain equity method investments based on the remaining period of performance for the related contract.