AADX Filings — Applied Aerospace & Defense, Inc. - FilingSpy
AADX
Applied Aerospace & Defense, Inc.
A maker of flight-critical parts and systems for aviation, space, and missile defense, serving helicopters, jets, and spacecraft. It came together in late 2025 when Applied Aerospace (founded 1954) merged with PCX Aerosystems, whose roots reach back to 1900 as Fenn Manufacturing, a small Connecticut machine shop making metal gauges. In 1939 that shop began machining rotorcraft parts for Sikorsky, a thread that runs through the company today.
IPO-related share-based compensation of $109.3M drove a $154.0M net loss despite revenue rising 50.7% to $167.3M.
growth accelerated, but a one-time IPO compensation charge reshaped the quarter's . Revenue rose 50.7% to $167.3M, led by the C5ISR and Precision Strike Systems , while a $109.3M non-cash expense tied to the company's IPO pushed to a $96.2M loss and net loss to $154.0M. The IPO proceeds were used to pay down $626.2M in debt, leaving the company with a strengthened balance sheet and a $1.13B contract .
Key takeaways
rose 50.7% to $167.3M, driven by a 261.6% increase in the C5ISR and Precision Strike Systems to $49.6M and a 58.5% increase in Space and Launch Systems to $38.8M.
A $109.3M non-cash charge for IPO-related was the primary driver of the quarter's results, with $10.0M recorded in cost of goods sold and $99.3M in .
Excluding the IPO-related in cost of goods sold, was 28.3%, compared to the reported 22.2%.
expense rose to $123.3M from $11.6M a year ago, almost entirely due to the $99.3M charge and $5.2M in IPO transaction costs.
Net loss widened to $154.0M from $4.7M, also reflecting a $31.5M income tax expense driven by changes.
The company's financial position was transformed by the IPO, with $635.6M in net proceeds used to repay $626.2M of debt, reducing the total to 0.33 from 0.80.
Contract reached $1.13B, up $258.7M from year-end 2025, including $178.5M from the CBI acquisition.
What to watch
Whether , adjusted for one-time IPO costs, can be sustained at or above the 28.3% level reported this quarter.
Progress in converting the $1.13B contract into , particularly in the C5ISR and Precision Strike Systems .
The impact of the reduced debt load on and in future quarters.
Any further changes to the income tax that could affect the .
Section summaries
Management's Discussion and Analysis
Q2 FY2026 revenue rose 47.4% to $167.3M, but IPO-related share-based compensation drove a $154.0M net loss.
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increased 47.4% to $167.3M in Q2 FY2026, led by C5ISR and Precision Strike Systems up 261.6% to $49.6M and Space and Launch Systems up 58.5% to $38.8M.
margin fell to 22.2% from 28.2%, driven by $10.0M of IPO-related in cost of goods sold; excluding that charge, margin was 28.3%.
SG&A expense surged 965.0% to $123.3M, primarily from $99.3M of tied to IPO equity incentive unit vesting, plus $5.2M of transaction costs.
Net loss widened to $154.0M from $4.7M, with income tax expense rising to $31.5M due to changes and higher projected pre-tax earnings.
reached $1.13B as of June 30, 2026, up $258.7M from December 31, 2025, including $178.5M from the CBI acquisition.
IPO net proceeds of $635.6M were used to repay $626.2M of debt, reducing total debt to $405.8M and total debt-to-capitalization to 0.33 from 0.80.
Quantitative and Qualitative Disclosures About Market Risk
For information regarding our exposure to certain market risks, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Quantitative and Qualitative Disclosures About Market Risk” in the Prospectus. There has been no material change in this i…
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For information regarding our exposure to certain market risks, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Quantitative and Qualitative Disclosures About Market Risk” in the Prospectus. There has been no material change in this information during the period covered by this Quarterly Report on Form 10-Q.