Aerospace and Defense - Mission-Critical Processing & High-Performance Computing Systems
Strategic Profile
After a challenging period between 2022 and 2024, Mercury has emerged in 2026 as a compelling turnaround story, pivoting from a component vendor to a systems-integrated powerhouse with stock surging over 135% in the last year and a record-breaking backlog approaching $1.5 billion. The "Software-Defined Defense" trend is the primary tailwind for Mercury in 2026.
Cyborg Score Rationale
Mercury delivered Q2 results with record backlog approaching $1.5 billion, adjusted EBITDA margin up 300 basis points year-over-year, and strong free cash flow of $46 million inflow. Recent performance indicates a successful operational turnaround with improving unit economics, though near-term margin pressures from lower-margin backlog conversion persist.
Top Insights
Stock has surged from a 52-week low of approximately $40 to a recent high of $103.84 as of February 2026.
Record total backlog of $1.4 billion at September 2025, up $86.4 million year-over-year, with $815.6 million expected to be recognized as revenue within the next 12 months.
Mercury's products and solutions are deployed in more than 300 programs and across 35 countries.
Recent 50,000-square-foot facility expansion in Phoenix has streamlined speed-to-field capabilities for advanced RF systems manufacturing.
Named Competitors
Curtiss-Wright — Primary rival in aerospace and defense processing
Moog — Motion control and space systems competitor
Lockheed Martin — Defense prime integrator and occasional competitor
Recent Developments
(February 2026) Q2 FY2026: Bookings of $288 million with book-to-bill of 1.23, revenue of $233 million up 4.4% YoY, and adjusted EBITDA up 36.3% YoY to $30 million.
(January 2026) Mercury announced new production agreement with AeroVironment for U.S. Space Force's Satellite Communication Augmentation Resource (SCAR) program.
(November 2025) Q1 FY2026 delivered ahead of expectations with solid year-over-year growth in backlog, revenue, adjusted EBITDA, and free cash flow through accelerated deliveries on customer high-priority programs.
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