New York, Feb 25, 2026, 08:31 EST — Premarket
Shares of Leonardo DRS edged down 0.2% to $43.75 in premarket action Wednesday, cooling off after Tuesday’s nearly 15% surge on strong earnings. The Nasdaq-listed defense name had closed at $43.82 the previous session.
The shift is notable: Leonardo DRS just put its 2026 guidance front and center for investors. The company is targeting revenue between $3.85 billion and $3.95 billion, with adjusted diluted EPS set at $1.20 to $1.26. That’s a bump from the $3.648 billion in revenue and $1.15 EPS outlook for 2025. CEO John Baylouny pointed to an $8.7 billion backlog at year-end. For 2025, the book-to-bill ratio landed at 1.2, so orders are running ahead of revenue.
This comes into a market that’s been eager to boost defense stocks with stable order books and solid cash flows. Leonardo, the Italian parent of DRS, said it surpassed its 2025 goals and highlighted sustained appetite for defense electronics. CEO Roberto Cingolani summed it up: “We exceeded the challenging guidance.” Reuters
DRS posted an 8% gain in fourth-quarter revenue, coming in at $1.06 billion. Adjusted EBITDA rose 7% to $158 million. For 2025, the company generated $227 million in free cash flow after capital expenditures, wrapping up the year with $647 million in cash and $191 million drawn on its credit facility. The numbers reflected a 10-year, $100 million laser intellectual property license for quantum use—booked at a discounted $73 million—which was partly counterbalanced by a $67 million revenue reduction tied to the shutdown of a legacy foreign surveillance project.
Zacks analysts had called for quarterly revenue of roughly $993 million and earnings of 37 cents a share—actual results topped both. It was that earnings beat, not the dividend numbers, that sent shares higher Tuesday.
CFO Michael Dippold, speaking on the earnings call, put first quarter revenue in the low $800 million range, with adjusted EBITDA margin also tracking in the low 11% area. Germanium supply is “contained,” Baylouny noted, but he did warn about some short-term price swings. The Motley Fool
The company, according to a Tuesday filing, furnished its earnings release via Form 8-K and hosted its conference call at 10 a.m. Eastern. The same filing noted a supplemental investor presentation was also posted.
Leonardo DRS makes tactical radars, infrared sensors, network computing gear, and ship propulsion or electric power systems. The company is up against bigger electronics names like RTX and L3Harris for slices of the U.S. defense budget.
There’s a risk the rally loses steam if margin pressure from materials and execution sticks around, or the one-off IP license stops boosting the run-rate. A drop-off in contract awards—or delays in government funding—would also weigh on order intake.
DRS has set its quarterly dividend at 9 cents, with payment slated for March 24 to holders registered by March 10. That’s the date circled on calendars now. The next focus? How the stock moves out of the gate, and whether the 2026 outlook still sticks as program timelines shift.
