Castellum — Q3 2026 Earnings Summary

Financial Performance:

• Q3 2026 revenues were $14.7 million, up from $14.6 million in Q3 2025 and $13.9 million in Q2 2026.
• Nine-month 2026 revenues totaled $42.9 million, an increase from $40.3 million in the same period of 2025.
• Q3 2026 gross profit was $5.3 million (36% of revenue), compared to $5.5 million (38%) in Q3 2025 and $4.7 million (34%) in Q2 2026.
• Nine-month 2026 gross profit was $15.1 million, flat compared to $15.1 million in 9M 2025.
• Q3 2026 Adjusted EBITDA was approximately $0.6 million, down from $1.1 million in Q3 2025 and up from $0.03 million in Q2 2026.
• Nine-month 2026 Adjusted EBITDA was $1.0 million, down from $1.8 million in 9M 2025.
• Q3 2026 net loss was $(0.5) million ($(0.01) per share), compared to net income of $0.4 million in Q3 2025 and net loss of $(1.1) million in Q2 2026.
• Nine-month 2026 net loss was $(1.9) million ($(0.02) per share), compared to a net loss of $(1.2) million in 9M 2025.
• Combined cash and accounts receivable totaled $24.5 million as of September 30, 2026, up from $24.0 million at June 30, 2026 and $23.1 million at December 31, 2025.
• Cash balance specifically was $15.7 million as of September 30, 2026.
• Operating cash flow for the first nine months of 2026 was $1.1 million, compared to $1.3 million used in the prior-year period.
• The company ended the quarter with no long-term debt.

Guidance and Future Outlook:

• The company expects to report record revenue for the full year 2026.
• Management anticipates recognizing approximately 25% of remaining performance obligations within the next 12 months and 51% within the next 24 months.
• The company plans to continue growing existing business through new contract awards, program expansion, and improved execution.
• M&A is identified as the principal opportunity to accelerate long-term growth, with a focus on executing acquisitions in the coming 6 to 12 months.

Business Segments and Product Lines:

• In August 2026, the subsidiary Global Technology and Management Resources, Inc. was awarded a $32.8 million NAVAIR contract modification under the PMA-290 Special Missions contract, bringing the total contract value to $136.2 million.
• Gross profit growth was limited in the first nine months of 2026 due to a higher mix of subcontractor work, which carries lower margins than direct labor.
• The company refined backlog reporting to include priced contract options previously reported separately within unfunded backlog.

Market and Competitive Landscape:

• Total scheduled backlog was $254.5 million at September 30, 2026, consisting of $18.2 million funded and $236.3 million unfunded, down from $271.7 million at June 30, 2026.
• Qualified opportunity pipeline increased to approximately $1.662 billion at September 30, 2026, up from $953.5 million at June 30, 2026.
• The company is a defense tech services and solutions provider focused on the federal government, offering services in cybersecurity, software development, systems engineering, information/electronic warfare, program support, and data analytics.
• The company is actively evaluating businesses that complement its capabilities, add new customer relationships, and contribute meaningful revenue and earnings.

Risks and Challenges:

• Forward-looking statements note risks including the ability to grow and execute on total backlog and qualified pipeline.
• Risks include the ability to compete against new and existing competitors and effectively integrate and grow acquired companies.
• Challenges include the ability to identify additional acquisition targets and close additional acquisitions.
• There is a risk regarding the company's ability to maintain the listing of its common stock on the NYSE American LLC.

Management Commentary and Tone:

• CEO Glen Ives stated that while Q3 revenue increased slightly year-over-year, the first nine months grew 6%, reflecting execution on major long-term prime contracts secured in 2025.
• CFO David Bell noted that the decline in Adjusted EBITDA was anticipated due to deliberate increased spending on business development and M&A activities as part of the 2026 growth strategy.
• Management emphasized a "purposely measured approach" to balancing growth objectives with expense management, citing a strong balance sheet with no debt and increased cash/AR balances as providing financial flexibility.
• Management views disciplined acquisitions as the strongest path to building scale and profitability.

Other Key Points:

• The company has no outstanding debt as of September 30, 2026.
• Stock-based compensation for Q3 2026 was $0.8 million, compared to $0.3 million in Q3 2025.
• Stock-based compensation for the nine months ended September 30, 2026, was $2.4 million, compared to $2.1 million in the prior-year period.
• Depreciation and amortization for Q3 2026 was $0.3 million, compared to $0.4 million in Q3 2025.
• Depreciation and amortization for the nine months ended September 30, 2026, was $1.0 million, compared to $1.1 million in the prior-year period.
• A conference call regarding these results is scheduled for November 6, 2026, at 10:00 am ET.