Mercury Systems secures $12.3 million contract for military aircraft

ANDOVER, Mass. - Mercury Systems, Inc. (NASDAQ:MRCY), a defense technology company with a market capitalization of $4.4 billion and strong year-to-date returns of 77%, has been awarded a $12.3 million development contract to create an avionics subsystem for a new U.S. military aircraft, the company announced Thursday.

The three-year agreement, signed in July with an unnamed defense prime contractor, tasks Mercury with developing a Communication Management Unit control head that will consolidate and manage multiple cockpit communications systems for a new fleet of aircraft.

"The Mercury Processing Platform offers unique technologies that enhance the pilot-machine interface to enable faster, better decisions," said Tom Smelker, Mercury’s Senior Vice President of Processing Technologies.

The contract represents a new product development within Mercury’s Displays and Networking product line, involving both a new customer and new end-user.

Mercury Systems specializes in delivering mission-critical processing technologies for aerospace and defense applications. The company’s products are currently deployed in more than 300 programs across 35 countries, supporting various applications including mission computing, sensor processing, command and control, and communications.

Based in Andover, Massachusetts, Mercury Systems operates from more than 20 locations worldwide.

The announcement was made in a company press release.

In other recent news, Mercury Systems reported its fourth-quarter 2025 earnings, achieving an earnings per share of $0.47, which significantly surpassed the forecast of $0.22. The company also reported revenue of $273 million, exceeding expectations of $243.61 million. Additionally, Mercury Systems has secured a new production agreement with AeroVironment to support the U.S. Space Force’s Satellite Communication Augmentation Resource program. This agreement will expand on Mercury’s initial 2023 contract for hardware production.

Analysts have been active in adjusting their outlooks on Mercury Systems. Jefferies raised its price target for the company to $75 from $50, maintaining a Hold rating, while noting a conservative fiscal year 2026 guidance. Truist Securities also increased its price target to $71 from $60, citing strong bookings and a significant revenue pull-forward. Meanwhile, Goldman Sachs reiterated its Sell rating with a price target of $39, despite the company’s adjusted EBITDA surpassing consensus expectations and showing margin improvement. These developments reflect varying analyst perspectives on Mercury Systems’ financial trajectory.

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