Booz Allen Hamilton Holding Corporation (BAH) Q2 2027 Financial Results Summary
QuoteReporter
Booz Allen Hamilton (BAH) Q2 FY2027: Mixed Results with Adjusted EPS Growth — Cautiously Optimistic
Booz Allen Hamilton Holding Corporation (NYSE: BAH) reported its second quarter fiscal 2027 results, revealing a revenue decline but notable growth in adjusted earnings metrics. Specifically, revenue for the quarter was $2.8 billion, a decrease of $112 million or 3.9% year-over-year. However, adjusted diluted EPS increased by 18.1% to $1.76, reflecting strong operational execution and strategic investments.
Key Financial Metrics
- Revenue: $2.8 billion, down $112 million or -3.9% YoY
- Revenue Excluding Billable Expenses: $2.0 billion, down $15 million or -0.8% YoY
- Net Income: $181 million, up $6 million or +3.4% YoY
- Adjusted Net Income: $211 million, up $28 million or +15.3% YoY
- Adjusted EBITDA: $313 million, down $11 million or -3.4% YoY
- Adjusted EBITDA Margin on Revenue: 11.3%, up 10 basis points YoY
- Adjusted Diluted EPS: $1.76, up $0.27 or +18.1% YoY
- Free Cash Flow: $263 million, down $132 million or -33.4% YoY
- Total Backlog: $41 billion, up 1.9% YoY
- Quarterly Book-to-Bill Ratio: 1.5x
Analyst Opinion
This quarter presents a mixed bag for shareholders. While the decline in revenue is concerning, the increase in adjusted net income and adjusted diluted EPS indicates that Booz Allen is effectively managing its costs and enhancing profitability. The company's ability to raise its adjusted diluted EPS guidance for the fiscal year is a positive sign, suggesting confidence in future performance. However, the significant drop in free cash flow and the overall revenue decline could raise questions about the sustainability of growth moving forward.
Dividend and Capital Deployment
Booz Allen Hamilton declared a regular quarterly dividend of $0.59 per share, payable on December 4, 2026, to stockholders of record on November 12, 2026. The company also reported total capital deployment of $965 million during the quarter, which includes investments in strategic initiatives aimed at enhancing its cyber and defense technology offerings.
Guidance Update
The company has updated its fiscal 2027 guidance, now projecting:
- Revenue: $11.3 - $11.6 billion (previously $11.2 - $11.7 billion)
- Adjusted EBITDA: $1,260 - $1,290 million (previously $1,240 - $1,290 million)
- Adjusted Diluted EPS: $6.50 - $6.70 (previously $6.00 - $6.35)
- Free Cash Flow: $850 - $925 million (unchanged)
This upward revision in guidance, particularly for adjusted diluted EPS, reflects management's optimism about the company's operational execution and market positioning.
Forward Catalysts
Investors should closely monitor Booz Allen's performance in the upcoming quarters, particularly in relation to its investments in advanced technologies and the execution of its National Security portfolio. The company’s ability to maintain or improve its backlog and book-to-bill ratio will be critical indicators of future revenue growth. Additionally, any updates on strategic acquisitions or partnerships could serve as significant catalysts for stock performance.
In summary, while Booz Allen Hamilton's Q2 FY2027 results show some challenges, the growth in adjusted earnings metrics and the raised guidance provide a cautiously optimistic outlook for shareholders.
Note: The following tables contain amounts in millions.
| Three Months Ended September 30 | 2026 | 2025 | 2026 | 2025 |
|---|---|---|---|---|
| Revenue | $2,778 | $2,890 | $5,578 | $5,814 |
| Operating costs and expenses: | ||||
| Cost of revenue | 1,333 | 1,340 | 2,669 | 2,763 |
| Billable expenses | 821 | 918 | 1,656 | 1,799 |
| General and administrative expenses | 328 | 308 | 633 | 631 |
| Depreciation and amortization | 51 | 41 | 96 | 81 |
| Total operating costs and expenses | 2,533 | 2,607 | 5,054 | 5,274 |
| Operating income | 245 | 283 | 524 | 540 |
| Interest expense, net | (52) | (48) | (100) | (92) |
| Other income (expense) | 6 | (2) | 26 | 1 |
| Income before income taxes | 199 | 233 | 450 | 449 |
| Income tax expense | 18 | 58 | 71 | 3 |
| Net income | $181 | $175 | $379 | $446 |
| Earnings per common share: | ||||
| Basic | $1.50 | $1.42 | $3.13 | $3.59 |
| Diluted | $1.50 | $1.42 | $3.13 | $3.58 |
Note: The following table contains amounts in millions.
| September 30, 2026 | March 31, 2026 | |
|---|---|---|
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $334 | $728 |
| Accounts receivable, net | 2,348 | 2,063 |
| Prepaid expenses and other current assets | 202 | 170 |
| Total current assets | 2,884 | 2,961 |
| Property and equipment, net of accumulated depreciation | 167 | 171 |
| Operating lease right-of-use assets | 257 | 147 |
| Intangible assets, net of accumulated amortization | 855 | 509 |
| Goodwill | 3,028 | 2,399 |
| Deferred tax assets | 219 | 294 |
| Other long-term assets | 898 | 637 |
| Total assets | $8,308 | $7,118 |
| Liabilities and stockholders' equity | ||
| Current liabilities: | ||
| Current portion of long-term debt | $19 | $19 |
| Accounts payable and other accrued expenses | 1,239 | 909 |
| Accrued compensation and benefits | 654 | 641 |
| Operating lease liabilities | 46 | 43 |
| Other current liabilities | 52 | 51 |
| Total current liabilities | 2,010 | 1,663 |
| Long-term debt, net of current portion | 4,391 | 3,921 |
| Operating lease liabilities, net of current portion | 252 | 139 |
| Postretirement and other long-term employee benefits | 233 | 224 |
| Other long-term liabilities | 178 | 66 |
| Total liabilities | 7,064 | 6,013 |
| Stockholders’ equity: | ||
| Common stock, Class A — $0.01 par value — authorized, 600,000,000 shares; issued, 170,671,224 shares at September 30, 2026 and 169,805,201 shares at March 31, 2026; outstanding, 119,096,968 shares at September 30, 2026 and 120,341,320 shares at March 31, 2026 | 2 | 2 |
| Treasury stock, at cost — 51,574,256 shares at September 30, 2026 and 49,463,881 shares at March 31, 2026 | (3,833) | (3,673) |
| Additional paid-in capital | 1,217 | 1,155 |
| Retained earnings | 3,879 | 3,644 |
| Accumulated other comprehensive loss | (21) | (23) |
| Total stockholders’ equity | 1,244 | 1,105 |
| Total liabilities and stockholders’ equity | $8,308 | $7,118 |
Disclaimer
The content on MarketsFN.com is provided for educational and informational purposes only. It does not constitute financial advice, investment recommendations, or trading guidance. All investments carry risk and past performance does not guarantee future results. You are solely responsible for your investment decisions and should conduct independent research and consult a qualified financial advisor before acting. MarketsFN.com and its authors are not liable for any losses or damages arising from the use of this information.
