What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-08-31 compared with 2026-06-01 · 199 added, 75 removed, 451 unchanged (38% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Three Months Ended

Three Months Ended Six Months Ended

2026 August 1,

2025 July 31,

2026 August 1,

(in millions, except per share amounts)

16 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended

Three Months Ended Six Months Ended

2026 August 1,

2025 July 31,

2026 August 1,

(in millions)

3 unchanged sentences

Net unrealized (loss) gain on derivative instruments

— ( 2 ) — ( 3 )

Total other comprehensive (loss) income, net of tax

— ( 2 ) ( 1 ) ( 3 )

Comprehensive income $ 102 $ 125 $ 216 $ 192

13 unchanged sentences

Intangible assets, net 697 761

Property, plant, and equipment (net of accumulated depreciation of $ 221 million and $ 215 million at May 1, 2026 and January 30, 2026, respectively)

Property, plant, and equipment (net of accumulated depreciation of $ 220 million and $ 215 million at July 31, 2026 and January 30, 2026, respectively)

Operating lease right of use assets 210 193

13 unchanged sentences

Commitments and contingencies (Note 11)

Common stock, $ 0.0001 par value, 1 billion shares authorized, 43 million and 44 million shares issued and outstanding as of May 1, 2026 and January 30, 2026, respectively

Common stock, $ 0.0001 par value, 1 billion shares authorized, 42 million and 44 million shares issued and outstanding as of July 31, 2026 and January 30, 2026, respectively

Additional paid-in capital — —

12 unchanged sentences

(in millions)

Balance at January 30, 2026 44 $ — $ 1,492 $ 8 $ 1,500

Balance at May 1, 2026 43 $ — $ 1,416 $ 7 $ 1,423

Net income — — 102 — 102

4 unchanged sentences

Stock-based compensation, net of shares withheld for taxes (1)

— ( 4 ) — — ( 4 )

Repurchases of stock ( 1 ) ( 18 ) ( 73 ) — ( 91 )

Balance at July 31, 2026 42 $ — $ 1,429 $ 7 $ 1,436

Balance at May 2, 2025 47 $ — $ 1,494 $ 11 $ 1,505

Net income — — 127 — 127

Issuances of stock — 6 — — 6

Other comprehensive loss, net of tax

— — — ( 2 ) ( 2 )

Cash dividends of $ 0.37 per share

— — ( 18 ) — ( 18 )

Stock-based compensation, net of shares withheld for taxes (1)

Repurchases of stock ( 1 ) ( 14 ) ( 95 ) — ( 109 )

Balance at August 1, 2025 46 $ — $ 1,508 $ 9 $ 1,517

Balance at January 30, 2026 44 $ — $ 1,492 $ 8 $ 1,500

5 unchanged sentences

Stock-based compensation, net of shares withheld for taxes (1)

Repurchases of stock ( 3 ) ( 19 ) ( 248 ) — ( 267 )

Balance at July 31, 2026 42 $ — $ 1,429 $ 7 $ 1,436

Balance at January 31, 2025 48 $ — $ 1,565 $ 12 $ 1,577

Net income — — 195 — 195

Issuances of stock — 12 — — 12

Other comprehensive loss, net of tax — — — ( 3 ) ( 3 )

Cash dividends of $ 0.74 per share

— — ( 36 ) — ( 36 )

Stock-based compensation, net of shares withheld for taxes (1)

Repurchases of stock ( 2 ) ( 18 ) ( 216 ) — ( 234 )

Balance at May 2, 2025 47 $ — $ 1,494 $ 11 $ 1,505

(1) During the three months ended May 1, 2026 and May 2, 2025, shares withheld for taxes related to stock-based compensation arrangements amounted to $ 17 million.

Balance at August 1, 2025 46 $ — $ 1,508 $ 9 $ 1,517

(1) During the three months ended July 31, 2026 and August 1, 2025, shares withheld for taxes related to stock-based compensation arrangements amounted to $ 2 million.

During the six months ended July 31, 2026 and August 1, 2025, shares withheld for taxes related to stock-based compensation arrangements amounted to $ 19 million.

See accompanying notes to condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

2026 August 1,

(in millions)

10 unchanged sentences

Prepaid expenses and other current assets

( 14 ) ( 107 )

Accounts payable and other accrued liabilities

4 unchanged sentences

Cash flows from investing activities:

Proceeds from sales of investments

Sales of marketable securities 5 3

Purchases of marketable securities ( 4 ) ( 4 )

Expenditures for property, plant, and equipment ( 24 ) ( 15 )

Contributions to investments

Net cash provided by (used in) investing activities

Purchases of marketable securities ( 9 ) ( 4 )

Sales of marketable securities 11 4

Proceeds from sales of investments

Net cash used in investing activities

( 14 ) ( 22 )

Cash flows from financing activities:

17 unchanged sentences

The reorganization was designed to simplify the Company's organization structure and optimize operations and customer focus for growth.

The consolidated business groups will be led by three Executive Vice Presidents.

The three business groups will continue to report directly to the Company’s Chief Executive Officer (“CEO”), the chief operating decision maker (“CODM”).

The consolidated business groups are led by three Executive Vice Presidents.

The three business groups report directly to the Company’s Chief Executive Officer (“CEO”), the chief operating decision maker (“CODM”).

The reorganization did not have an impact on the Company's reportable segments.

The Company now has three customer facing business groups which are also its operating segments.

The Company has three customer facing business groups which are also its operating segments.

They are aggregated into two reportable segments for financial reporting purposes given the similarity in economic and qualitative characteristics, and based on the nature of the customers they serve.

31 unchanged sentences

Each investment is evaluated for consolidation under the variable interest entities model and/or the voting interest model.

As of May 1, 2026, none of the Company's investments in equity securities were consolidated.

On April 20, 2026, the Company sold all of its equity in one of its investments, which resulted in a gain of $ 12 million recognized within "Other operating (income) expense" on the condensed consolidated statements of income and $ 15 million in cash proceeds, recognized within "Proceeds from sales of investments" on the condensed consolidated statements of cash flows.

As of July 31, 2026, none of the Company's investments in equity securities were consolidated.

During the first quarter of fiscal 2027, on April 20, 2026, the Company sold all of its equity in one of its investments, which resulted in a gain of $ 12 million recognized within "Other operating (income) expense" on the condensed consolidated statements of income and $ 15 million in cash proceeds, recognized within "Proceeds from sales of investments" on the condensed consolidated statements of cash flows.

Cash, Cash Equivalents and Restricted Cash

37 unchanged sentences

The following table provides a reconciliation of the weighted-average number of shares outstanding used to compute basic and diluted EPS for the periods presented:

Three Months Ended

Three Months Ended Six Months Ended

2026 August 1,

2025 July 31,

2026 August 1,

(in millions)

Basic weighted-average number of shares outstanding

42.4 46.7 43.1 47.1

Dilutive common share equivalents - stock options and other stock-based awards 0.4 0.1 0.3 0.2

Diluted weighted-average number of shares outstanding

Antidilutive stock awards excluded from the weighted-average number of shares outstanding used to compute diluted EPS for the three months ended May 1, 2026 and May 2, 2025 were immaterial .

42.8 46.8 43.4 47.3

Antidilutive stock awards excluded from the weighted-average number of shares outstanding used to compute diluted EPS for the three and six months ended July 31, 2026 and August 1, 2025 were immaterial .

Share Repurchases

3 unchanged sentences

The Company has not made any material purchases of common stock other than in connection with its established share repurchase plans.

During the three months ended May 1, 2026, the Company repurchased approximately 1.9 million shares of its common stock from the open market under its existing share repurchase plan for approximately $ 175 million.

During the six months ended July 31, 2026, the Company repurchased approximately 2.7 million shares of its common stock from the open market under its existing share repurchase plan for approximately $ 265 million.

In December 2024, the Company's Board of Directors authorized the repurchase of up to $ 1.2 billion of the Company's outstanding common stock under its existing share repurchase plan.

As of May 1, 2026, the Company has repurchased approximately 30.4 million shares of its common stock under the plan for approximately $ 2.7 billion, which included amounts previously authorized under the plan prior to December 2024.

As of July 31, 2026, the Company has repurchased approximately 31.2 million shares of its common stock under the plan for approximately $ 2.8 billion, which included amounts previously authorized under the plan prior to December 2024.

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company declared and paid a quarterly dividend of $ 0.37 per share of its common stock during the three months ended May 1, 2026.

Subsequent to the end of the quarter, on May 28, 2026, the Company's Board of Directors declared a quarterly dividend of $ 0.37 per share of the Company's common stock payable on July 24, 2026 to stockholders of record on July 10, 2026.

The Company declared and paid a quarterly dividend of $ 0.37 per share of its common stock during the three months ended July 31, 2026.

Note 3—Revenues:

10 unchanged sentences

Aggregate net changes in estimates on contracts accounted for using the cost-to-cost method of accounting were recognized in operating income as follows:

Three Months Ended

Three Months Ended Six Months Ended

2026 August 1,

2025 July 31,

2026 August 1,

(in millions, except per share amounts)

Net favorable (unfavorable) adjustments

$ 6 $ 5 $ 14 $ 3

Net favorable (unfavorable) adjustments, after tax

Basic and Diluted EPS impact $ 0.14 $ ( 0.04 )

Revenues were $ 3 million higher for the three months ended May 1, 2026 and were unchanged for the three months ended May 2, 2025, due to net revenue recognized from performance obligations satisfied in prior periods.

Basic EPS impact $ 0.12 $ 0.13 $ 0.26 $ 0.06

Diluted EPS impact $ 0.12 $ 0.13 $ 0.25 $ 0.06

Revenues were $ 6 million and $ 9 million higher for the three and six months ended July 31, 2026, respectively, and were $ 7 million higher for the three and six months ended August 1, 2025, due to net revenue recognized from performance obligations satisfied in prior periods.

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

6 unchanged sentences

Three Months Ended

July 31, 2026

August 1, 2025

Defense and Intelligence

7 unchanged sentences

Total $ 1,449 $ 431 $ 1,880 $ 1,374 $ 395 $ 1,769

Six Months Ended

July 31, 2026

August 1, 2025

Defense and Intelligence

(in millions)

Department of War $ 1,967 $ 2 $ 1,969 $ 1,902 $ 5 $ 1,907

Intelligence and other federal government agencies

932 783 1,715 889 768 1,657

Commercial, state and local governments and international

16 86 102 16 66 82

Total $ 2,915 $ 871 $ 3,786 $ 2,807 $ 839 $ 3,646

Disaggregated revenues by contract type were as follows:

Three Months Ended

July 31, 2026

August 1, 2025

Defense and Intelligence

7 unchanged sentences

Total $ 1,449 $ 431 $ 1,880 $ 1,374 $ 395 $ 1,769

Six Months Ended

July 31, 2026

August 1, 2025

Defense and Intelligence

(in millions)

Cost reimbursement $ 2,287 $ 19 $ 2,306 $ 2,227 $ 33 $ 2,260

Time and materials ("T&M")

283 589 872 258 568 826

Firm-fixed price ("FFP")

345 263 608 322 238 560

Total $ 2,915 $ 871 $ 3,786 $ 2,807 $ 839 $ 3,646

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Disaggregated revenues by prime versus subcontractor were as follows:

Three Months Ended

May 1, 2026 May 2, 2025

July 31, 2026 August 1, 2025

Defense and Intelligence

5 unchanged sentences

Total $ 1,449 $ 431 $ 1,880 $ 1,374 $ 395 $ 1,769

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Six Months Ended

July 31, 2026 August 1, 2025

Defense and Intelligence

(in millions)

Prime contractor to federal government $ 2,625 $ 729 $ 3,354 $ 2,538 $ 701 $ 3,239

Subcontractor to federal government 274 56 330 253 72 325

Other 16 86 102 16 66 82

Total $ 2,915 $ 871 $ 3,786 $ 2,807 $ 839 $ 3,646

Contract Balances

Contract balances for the periods presented were as follows:

Balance Sheet line item May 1,

Balance Sheet line item July 31,

2026 January 30,

8 unchanged sentences

Other long-term liabilities

(1) Net of allowance of $ 2 million as of May 1, 2026 and January 30, 2026.

During the three months ended May 1, 2026 and May 2, 2025, the Company recognized revenues of $ 18 million and $ 17 million relating to amounts that were included in the opening balance of contract liabilities as of January 30, 2026 and January 31, 2025, respectively.

(1) Net of allowance of $ 2 million as of July 31, 2026 and January 30, 2026.

During the three and six months ended July 31, 2026, the Company recognized revenues of $ 11 million and $ 29 million, respectively, relating to amounts that were included in the opening balance of contract liabilities as of January 30, 2026.

During the three and six months ended August 1, 2025, the Company recognized revenues of $ 8 million and $ 25 million, respectively, relating to amounts that were included in the opening balance of contract liabilities as of January 31, 2025.

Remaining Performance Obligations

1 unchanged sentence

RPO does not include unexercised option periods and future task orders expected to be awarded under IDIQ contracts.

As of May 1, 2026, the Company had approximately $ 6.6 billion of RPO.

As of July 31, 2026, the Company had approximately $ 6.4 billion of RPO.

The Company expects to recognize revenue on approximately 75 % of the RPO over the next 12 months and approximately 90 % over the next 24 months, with the remaining recognized thereafter.

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 4—Acquisitions:

Acquisition of SilverEdge Government Solutions (“SilverEdge”)

On October 15, 2025, the Company acquired SilverEdge, an innovative provider of mission-driven technology solutions and products, for a preliminary purchase price of $ 203 million, net of $ 6 million cash acquired, subject to post-closing adjustments.

On October 15, 2025, the Company acquired SilverEdge, an innovative provider of mission-driven technology solutions and products, for a purchase price of $ 202 million, net of $ 6 million cash acquired.

The acquisition advances the Company's strategy to provide mission focused, IP-based solutions and commercial products to its customers.

The Company funded the transaction from increased borrowings and cash on hand.

As of May 1, 2026, the Company has substantially completed the purchase price allocation related to this acquisition, primarily subject to the finalization of working capital adjustments.

As of July 31, 2026, the Company has substantially completed the purchase price allocation, primarily subject to the final measurement of deferred income taxes.

The Company has preliminarily recorded goodwill and amortizable intangible assets of $ 93 million and $ 101 million, respectively.

2 unchanged sentences

The intangible assets consist of customer relationships of $ 90 million, developed technology of $ 9 million, and backlog of $ 2 million that will be amortized over a period of ten years , eight years , and one year , respectively.

During the three months ended May 1, 2026, revenues of $ 19 million related to SilverEdge were recorded to the Defense and Intelligence reportable segment.

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

During the three and six months ended July 31, 2026, revenues of $ 20 million and $ 39 million, respectively, related to SilverEdge were recorded to the Defense and Intelligence reportable segment.

Note 5—Goodwill and Intangible Assets:

13 unchanged sentences

Under the market approach, the Company estimated the fair value of its reporting units based on multiples of earnings derived from observable market data of comparable public companies.

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Intangible Assets

Intangible assets, all of which were finite-lived, consisted of the following:

May 1, 2026 January 30, 2026

July 31, 2026 January 30, 2026

Gross carrying value Accumulated amortization Net carrying value Gross carrying value Accumulated amortization Net carrying value

4 unchanged sentences

Total intangible assets $ 1,571 $ ( 874 ) $ 697 $ 1,572 $ ( 811 ) $ 761

Amortization expense related to intangible assets was $ 32 million and $ 29 million for the three months ended May 1, 2026 and May 2, 2025, respectively.

Amortization expense related to intangible assets was $ 32 million and $ 64 million for the three and six months ended July 31, 2026, respectively, and was $ 29 million and $ 58 million for the three and six months ended August 1, 2025, respectively.

There were no intangible asset impairment losses during the periods presented.

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

As of May 1, 2026, the estimated future annual amortization expense related to intangible assets is as follows:

Fiscal Year (in millions)

As of July 31, 2026, the estimated future annual amortization expense related to intangible assets is as follows:

Fiscal Year Total

(in millions)

Remainder of 2027 $ 62

2 unchanged sentences

Note 6—Income Taxes:

The Company's effective income tax rate was 20.9 % and 20.6 % for the three months ended May 1, 2026 and May 2, 2025, respectively.

The rate for both periods was below the Company's combined federal and state statutory tax rate, primarily due to research and development tax credits and the tax deduction for foreign-derived deduction eligible income.

The Company's effective income tax rate was 14.2 % and 17.9 % for the three and six months ended July 31, 2026, respectively, and was ( 17.2 )% and ( 0.4 )% for the three and six months ended August 1, 2025, respectively.

The effective tax rates for the prior year periods reflected a $ 47 million tax benefit related to the settlement of an IRS audit covering fiscal years 2016 through 2019.

For the three and six months ended July 31, 2026, the Company's effective tax rates were lower than the combined federal and state statutory tax rates, primarily due to research and development tax credits and the tax deduction for foreign-derived deduction eligible income.

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 7—Debt Obligations:

The Company’s debt as of the dates presented was as follows:

May 1, 2026 January 30, 2026

July 31, 2026 January 30, 2026

rate Effective

12 unchanged sentences

$ 2,466 $ ( 14 ) $ 2,452 $ 2,482 $ ( 14 ) $ 2,468

As of May 1, 2026, the Company had a $ 2.6 billion secured credit facility (the "Credit Facility") consisting of a Term Loan A Facility due September 2030, a Term Loan B3 Facility due February 2031 (together, the "Term Loan Facilities"), and a $ 1.0 billion Revolving Credit Facility due September 2030 (the "Revolving Credit Facility").

During the three months ended May 1, 2026, the Company made a scheduled principal payment of $ 1 million on the Term Loan B3 Facility due February 2031.

During the three months ended May 1, 2026, the Company made no borrowings or repayments under the Revolving Credit Facility, and as of May 1, 2026 and January 30, 2026, there were no borrowings outstanding.

As of May 1, 2026, the Company was in compliance with the covenants under its Credit Facility.

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

As of May 1, 2026 and January 30, 2026, the carrying value of the Company’s outstanding debt obligations approximated its fair value.

As of July 31, 2026, the Company had a $ 2.6 billion secured credit facility (the "Credit Facility") consisting of a Term Loan A Facility due September 2030, a Term Loan B3 Facility due February 2031 (together, the "Term Loan Facilities"), and a $ 1.0 billion Revolving Credit Facility due September 2030 (the "Revolving Credit Facility").

During the three and six months ended July 31, 2026, the Company made scheduled principal payments of $ 1 million and $ 2 million, respectively, on the Term Loan B3 Facility due February 2031.

During the three and six months ended July 31, 2026, the Company made no borrowings or repayments under the Revolving Credit Facility, and as of July 31, 2026 and January 30, 2026, there were no borrowings outstanding.

As of July 31, 2026, the Company was in compliance with the covenants under its Credit Facility.

As of July 31, 2026 and January 30, 2026, the carrying value of the Company’s outstanding debt obligations approximated its fair value.

The fair value of debt is calculated using Level 2 inputs, based on interest rates available for debt with terms and maturities similar to the Company’s Term Loan Facilities and Senior Notes.

Maturities of debt as of May 1, 2026 are:

Maturities of debt as of July 31, 2026 are:

Fiscal Year Total

2 unchanged sentences

Thereafter 975

Total principal payments $ 2,500

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 8—Changes in Accumulated Other Comprehensive Income (Loss) by Component:

7 unchanged sentences

(in millions)

Three months ended May 1, 2026

Balance at January 30, 2026 $ 8 $ — $ 8

Three months ended July 31, 2026

Balance at May 1, 2026 $ 7 $ — $ 7

Other comprehensive income before reclassifications — — —

2 unchanged sentences

Net other comprehensive loss — — —

Balance at July 31, 2026 $ 7 $ — $ 7

Three months ended August 1, 2025

Balance at May 2, 2025 $ 8 $ 3 $ 11

Three months ended May 2, 2025

Other comprehensive income before reclassifications

Amounts reclassified from accumulated other comprehensive income

— ( 3 ) ( 3 )

Income tax impact — — —

Net other comprehensive loss

— ( 2 ) ( 2 )

Balance at August 1, 2025 $ 8 $ 1 $ 9

Six months ended July 31, 2026

Balance at January 30, 2026 $ 8 $ — $ 8

1 unchanged sentence

Amounts reclassified from accumulated other comprehensive income ( 1 ) — ( 1 )

Income tax impact — — —

Net other comprehensive loss ( 1 ) — ( 1 )

Balance at July 31, 2026 $ 7 $ — $ 7

Six months ended August 1, 2025

Balance at January 31, 2025 $ 8 $ 4 $ 12

Other comprehensive income before reclassifications — 1 1

Amounts reclassified from accumulated other comprehensive income

— ( 5 ) ( 5 )

2 unchanged sentences

— ( 3 ) ( 3 )

Balance at May 2, 2025 $ 8 $ 3 $ 11

Balance at August 1, 2025 $ 8 $ 1 $ 9

(1) The amount reclassified from accumulated other comprehensive income (loss) is included in "Other (income) expense, net."

5 unchanged sentences

MARPA Facility activity consisted of the following:

Three Months Ended

Six Months Ended

2026 August 1,

(in millions)

6 unchanged sentences

Remaining sold receivables (3)

(1) For the three months ended May 1, 2026, there was no net impact to cash flows from operating activities from sold receivables.

For the three months ended May 2, 2025, the Company recorded a net increase of $ 136 million to cash flows from operating activities from sold receivables.

(1) For the six months ended July 31, 2026, there was no net impact to cash flows from operating activities from sold receivables.

For the six months ended August 1, 2025, the Company recorded a net increase of $ 101 million to cash flows from operating activities from sold receivables.

(2) The cash collected, not remitted balance is included in "Accounts payable" on the condensed consolidated balance sheets.

3 unchanged sentences

The reorganization was designed to simplify the Company's organization structure and optimize operations and customer focus for growth.

The consolidated business groups will be led by three Executive Vice Presidents.

The three business groups will continue to report directly to the Company’s CEO, the CODM.

The consolidated business groups are led by three Executive Vice Presidents.

The three business groups report directly to the Company’s CEO, the CODM.

The reorganization did not have an impact on the Company's reportable segments.

The Company now has three customer facing business groups which are also its operating segments.

The Company has three customer facing business groups which are also its operating segments.

11 unchanged sentences

Adjusted operating income is a performance measure that primarily excludes the impact of non-recurring transactions and activities that the Company does not consider to be indicative of its ongoing operating performance.

Adjusted operating income is calculated by taking operating income and excluding depreciation and amortization, acquisition, integration, restructuring, and impairment costs, and any other material non-recurring costs.

Adjusted operating income is calculated by taking operating income and excluding amortization of intangible assets, depreciation of property, plant, and equipment, acquisition, integration, restructuring, and impairment costs, and any other material non-recurring costs.

The CODM uses revenues and adjusted operating income to assess the financial performance of each operating segment against pre-established performance targets and to allocate resources for strategic business decisions, including investments in certain products or services, potential acquisitions or divestitures, and capital deployment.

1 unchanged sentence

The segment information for the periods presented was as follows:

Three Months Ended May 1, 2026

Three Months Ended July 31, 2026

Defense and Intelligence

5 unchanged sentences

Adjusted operating income (loss) $ 138 $ 56 $ ( 3 ) $ 191

Three Months Ended May 2, 2025

Three Months Ended August 1, 2025

Defense and Intelligence Civilian Corporate Total SAIC

5 unchanged sentences

Adjusted operating income (loss) $ 124 $ 54 $ 4 $ 182

Six Months Ended July 31, 2026

Defense and Intelligence

(in millions)

Revenues $ 2,915 $ 871 $ — $ 3,786

Labor base 840 254 — 1,094

Other operating expenses (income) (1)

1,791 493 ( 4 ) 2,280

Adjusted operating income (loss) $ 284 $ 124 $ 4 $ 412

Six Months Ended August 1, 2025

Defense and Intelligence Civilian Corporate Total SAIC

(in millions)

Revenues $ 2,807 $ 839 $ — $ 3,646

Labor base 841 257 — 1,098

Other operating expenses (income) (1)

1,727 476 5 2,208

Adjusted operating income (loss) $ 239 $ 106 $ ( 5 ) $ 340

(1) "Other operating expenses (income)" includes cost of revenues, selling, general and administrative expenses, and other operating income or expenses which are not regularly provided to the CODM.

2 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The table below includes a reconciliation of total "Adjusted operating income" to "Income before income taxes" for the three months ended May 1, 2026 and May 2, 2025.

The table below includes a reconciliation of total "Adjusted operating income" to "Income before income taxes" for the three and six months ended July 31, 2026 and August 1, 2025.

Three Months Ended

Six Months Ended

2026 August 1,

2025 July 31,

2026 August 1,

(in millions)

Adjusted operating income

$ 191 $ 182 $ 412 $ 340

Depreciation of property, plant, and equipment

2 unchanged sentences

Recovery of acquisition, integration, restructuring and impairment costs

( 1 ) — ( 2 ) ( 2 )

Costs related to the settlement of federal tax audits

Gain on divestitures, net of transaction costs

( 1 ) — ( 1 ) —

Interest expense, net

1 unchanged sentence

Income before income taxes

(1) Adjustment reflects the portion of acquisition, integration, restructuring and impairment costs recovered through the Company's indirect rates in accordance with U.S.

government Cost Accounting Standards.

$ 119 $ 108 $ 264 $ 194

Asset information by segment is not a key measure of performance used by the CODM.

18 unchanged sentences

If future completed audit adjustments exceed the Company’s reserves for potential adjustments, the Company’s profitability could be materially adversely affected.

As of May 1, 2026, the Company believes it has adequately reserved for estimated net amounts to be refunded to customers for potential adjustments for indirect cost audits and compliance with U.S.

As of July 31, 2026, the Company believes it has adequately reserved for estimated net amounts to be refunded to customers for potential adjustments for indirect cost audits and compliance with U.S.

government Cost Accounting Standards.

Letters of Credit and Surety Bonds

The Company has outstanding obligations relating to letters of credit of $ 8 million as of May 1, 2026, principally related to guarantees on insurance policies.

The Company has outstanding obligations relating to letters of credit of $ 8 million as of July 31, 2026, principally related to guarantees on insurance policies.

The Company also has outstanding obligations relating to surety bonds of $ 19 million, principally related to performance and payment bonds on the Company’s contracts.

Note 12—Subsequent Events:

Accounts Receivable Facility

On August 14, 2026, the Company amended the MARPA to increase the aggregate facility limit from $ 300 million to $ 400 million.

Quarterly Dividend Declared

On August 27, 2026, the Company's Board of Directors declared a quarterly dividend of $ 0.37 per share of the Company's common stock payable on October 23, 2026 to stockholders of record on October 9, 2026.

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements