Redwire (NYSE:RDW) reported higher third-quarter revenue and a record gross margin as growth in its space business offset a decline in defense technology sales tied to the timing of aircraft shipments. The company reaffirmed its full-year revenue forecast, citing a record backlog and inventory awaiting delivery.
Revenue rose 5.4% from a year earlier to $109 million, although it declined sequentially. The net loss narrowed by $18 million to $23.2 million, while adjusted earnings before interest, taxes, depreciation and amortization, or adjusted EBITDA, was negative $5.3 million.
Chairman and CEO Peter Cannito said uneven milestones and deliveries can shift revenue between quarters. Chief Financial Officer Chris Edmunds said defense tech shipments were affected by timing as the team prepared to deliver the next generation of autonomous platforms.
Margins rise as defense shipments shift
Gross margin increased to 32.3% from 16.3% a year earlier. Edmunds attributed the improvement to a change in contract mix, more than $700 million in new awards over the preceding 12 months and the near completion of several lower-margin space programs.
On an adjusted, comparable basis that accounted for a purchase accounting adjustment in the prior-year quarter, Edmunds said space gross margin rose to 18% from 4%, while defense tech margin increased to 50% from 45%.
Space segment revenue rose more than 30% organically to $61.3 million. Defense tech revenue fell year over year to $47.8 million. For the first nine months, companywide revenue increased 42.6% to $323.1 million.
Research and development expense climbed to $14.4 million from $7.7 million in the quarter. Asked about the path to adjusted EBITDA break-even, Cannito said the company views internal research and development as a discretionary investment that it can adjust according to market conditions and opportunities. Edmunds said year-to-date adjusted EBITDA was negative $18 million.
Backlog supports revenue forecast
Third-quarter bookings were $188.7 million, producing a book-to-bill ratio of 1.73. Contracted backlog reached a record $619.7 million, up 14.3% sequentially and nearly 75% from a year earlier. Space accounted for $379.6 million of the backlog and defense tech for $240.1 million.
Redwire reaffirmed its 2026 revenue outlook of $450 million to $500 million. With $323.1 million recorded through September, the range implies approximately $126.9 million to $176.9 million in fourth-quarter revenue. Edmunds said the forecast was supported by backlog and $46.8 million of defense tech work-in-process and finished-goods inventory, which increased $10.6 million during the quarter.
Edmunds cautioned that the company must complete and ship products, and secure licenses where needed, to recognize the associated revenue. Cannito said export-control approvals or late supplier deliveries can move large orders between reporting periods. He also clarified during the call that defense tech backlog, rather than bookings, had doubled year over year.
Redwire ended the quarter with $538.9 million in liquidity, including $50 million of undrawn revolver capacity, and $47.8 million in total debt. Edmunds said the company issued no shares under its existing at-the-market program during the quarter.
New awards span space and defense
Cannito announced a $20 million DARPA contract for testing and experimentation on a scaled SabreSat for a precursor flight in very low Earth orbit under the Otter program. The award adds a second flight mission to Redwire’s work on the program. Cannito said the additional flight came earlier than the company had expected, though he did not provide a timeline for an operational program.
Redwire also received a $15 million contract to supply ELSA solar-array wings to satellite customer AscendArc. Cannito said the award brought announced ELSA contracts to $27.8 million since the product’s introduction earlier in the year. The company also won a contract for two Roll-Out Solar Array wings for Axiom’s second space station module.
In defense tech, Redwire secured a $13.8 million contract to deliver Stalker aircraft to the U.S. National Guard. Cannito said the aircraft will be used to train soldiers in flight operations, field maintenance and payload deployment. Redwire also delivered more than 200 space sensors through Sept. 30, double the year-earlier amount.
Looking ahead, Cannito said space and defense have bipartisan support but that government budget decisions could cause near-term uncertainty. He said Redwire’s existing programs and international business help position it to manage potential disruption. The company will continue to evaluate acquisitions alongside internal investments while seeking to maintain a strong balance sheet, he said.
About Redwire (NYSE:RDW)
Redwire Corporation (NYSE: RDW) is a space infrastructure and defense technology company that develops products and services for government and commercial customers. Its capabilities support spacecraft, space stations, national security missions, and other applications across the space economy.
The company’s offerings include deployable solar arrays, spacecraft platforms, avionics, sensors, communications systems, digital engineering and mission-support services. Redwire also develops robotic systems, in-space manufacturing technologies, payloads, and other solutions designed to enable spacecraft operations and the production of materials in orbit.
Redwire was formed in 2020 through the combination of several space technology businesses backed by AE Industrial Partners and became a publicly traded company in 2021.
