# EDGAR Filing Document

**Accession Number:** 0001049521
**File Stem:** 0001049521-25-000062
**Filing Date:** 2025-11
**Character Count:** 250254
**Document Hash:** 2b4e423fa42bac754c537bfbec407195
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001049521-25-000062.hdr.sgml**: 20251104

**ACCESSION NUMBER**: 0001049521-25-000062

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 115

**CONFORMED PERIOD OF REPORT**: 20250926

**FILED AS OF DATE**: 20251104

**DATE AS OF CHANGE**: 20251104

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** MERCURY SYSTEMS INC
- **CENTRAL INDEX KEY:** 0001049521
- **STANDARD INDUSTRIAL CLASSIFICATION:** ELECTRONIC COMPONENTS & ACCESSORIES [3670]
- **ORGANIZATION NAME:** 04 Manufacturing
- **EIN:** 042741391
- **STATE OF INCORPORATION:** MA
- **FISCAL YEAR END:** 0630

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-41194
- **FILM NUMBER:** 251450655

**BUSINESS ADDRESS:**
- **STREET 1:** 50 MINUTEMAN ROAD
- **CITY:** ANDOVER
- **STATE:** MA
- **ZIP:** 01810
- **BUSINESS PHONE:** 9782561300

**MAIL ADDRESS:**
- **STREET 1:** 50 MINUTEMAN ROAD
- **CITY:** ANDOVER
- **STATE:** MA
- **ZIP:** 01810

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** MERCURY COMPUTER SYSTEMS INC
- **DATE OF NAME CHANGE:** 19971112

?xml version='1.0' encoding='ASCII'? mrcy-20250926

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549** 

**________________________________________________________________**

**FORM 10-Q**

**________________________________________________________________**

☒ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the quarterly period ended September 26, 2025** 

**OR**

☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the transition period from &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**

**COMMISSION FILE NUMBER: 001-41194** 

**________________________________________________________________**

**MERCURY SYSTEMS, INC.** 

**(Exact name of registrant as specified in its charter)**

**________________________________________________________________**

---

| | | |
|:---|:---|:---|
| **Massachusetts** | **Massachusetts** | **04-2741391** |
| **(State or other jurisdiction of<br>incorporation or organization)** | **(State or other jurisdiction of<br>incorporation or organization)** | **(I.R.S. Employer<br>Identification No.)** |
| **50 MINUTEMAN ROAD** | **50 MINUTEMAN ROAD** | **01810** |
| **ANDOVER** | **MA** | **01810** |
| **(Address of principal executive offices)** | **(Address of principal executive offices)** | **(Zip Code)** |

---

**978-256-1300** 

**(Registrant's telephone number, including area code)**

**Securities registered pursuant to Section 12(b) of the Act:**

---

| | | |
|:---|:---|:---|
| **Title of Each Class** | **Trading Symbol(s)** | **Name of Each Exchange on Which Registered** |
| Common Stock, par value $0.01 per share | MRCY | Nasdaq Global Select Market |

---

**____________________________________________________________**

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.&nbsp;&nbsp;&nbsp;&nbsp;Yes ⌧&nbsp;&nbsp;&nbsp;&nbsp;No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).&nbsp;&nbsp;&nbsp;&nbsp;Yes ⌧&nbsp;&nbsp;&nbsp;&nbsp;No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

---

| | | | |
|:---|:---|:---|:---|
| Large Accelerated Filer | ⌧ | Accelerated filer | ◻ |
| Non-accelerated filer | ◻ | Smaller reporting company | ☐ |
| Emerging growth company | ☐ | | |

---

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act).&nbsp;&nbsp;&nbsp;&nbsp;Yes ☐&nbsp;&nbsp;&nbsp;&nbsp;No ⌧

Shares of Common Stock outstanding as of October 31, 2025: 60,100,136 shares.

------

**MERCURY SYSTEMS, INC.**

**INDEX**

---

| | | |
|:---|:---|:---|
| | | **PAGE<br>NUMBER** |
| PART I. FINANCIAL INFORMATION | PART I. FINANCIAL INFORMATION |  |
| Item 1. | <u>[Consolidated Financial Statements (unaudited)](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_13)</u> | [3](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_13) |
|  | <u>[Consolidated Balance Sheets as of September 26, 2025 and June 27, 2025](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_16)</u> | [3](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_16) |
|  | <u>[Consolidated Statements of Operations and Comprehensive Loss for the first quarters ended September 26, 2025 and September 27, 2024](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_22)</u> | [4](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_22) |
|  | <u>[Consolidated Statements of Shareholders' Equity for the first quarters ended September 26, 2025 and September 27, 2024](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_25)</u> | [5](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_25) |
|  | <u>[Consolidated Statements of Cash Flows for the first quarters ended September 26, 2025 and September 27, 2024](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_28)</u> | [6](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_28) |
|  | <u>[Notes to Consolidated Financial Statements](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_31)</u> | [7](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_31) |
| Item 2. | <u>[Management's Discussion and Analysis of Financial Condition and Results of Operations](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_76)</u> | [23](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_76) |
| Item 3. | <u>[Quantitative and Qualitative Disclosures about Market Risk](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_109)</u> | [33](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_109) |
| Item 4. | <u>[Controls and Procedures](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_112)</u> | [33](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_112) |
| PART II. OTHER INFORMATION | PART II. OTHER INFORMATION |  |
| Item 1. | <u>[Legal Proceedings](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_118)</u> | [34](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_118) |
| Item 1A. | <u>[Risk Factors](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_121)</u> | [34](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_121) |
| Item 5. | <u>[Other Information](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_124)</u> | [34](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_124) |
| Item 6. | <u>[Exhibits](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_127)</u> | [36](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_127) |
|  | <u>[Signatures](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_130)</u> | [37](#i2ca0a1027dbe4d77b3a6028c5f24fbcd_130) |

---

------

**PART I. FINANCIAL INFORMATION**

**ITEM 1. &nbsp;&nbsp;&nbsp;&nbsp;FINANCIAL STATEMENTS**

**MERCURY SYSTEMS, INC.**

**CONSOLIDATED BALANCE SHEETS**

(In thousands, except share and per share data)

(Unaudited)

---

| | | |
|:---|:---|:---|
| | **September 26, 2025** | **June 27, 2025** |
| **Assets** | | |
| Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $304716 | $309099 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, net of allowance for credit losses of $1,832 and $1,767 at September 26, 2025 and June 27, 2025, respectively | 92648 | 109588 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unbilled receivables and costs in excess of billings, net of allowance for credit losses of $5,311 for both September 26, 2025 and June 27, 2025 | 274835 | 278475 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory | 340246 | 332920 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid income taxes | 1389 | 457 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 70789 | 27639 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 1084623 | 1058178 |
| Property and equipment, net | 102634 | 101440 |
| Goodwill | 938093 | 938093 |
| Intangible assets, net | 200407 | 210611 |
| Operating lease right-of-use assets, net | 53869 | 52264 |
| Deferred tax assets | 72861 | 69016 |
| Other non-current assets | 5105 | 5162 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $2457592 | $2434764 |
| **Liabilities and Shareholders' Equity** |  |  |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | $97814 | $79116 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | 75331 | 43143 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued compensation | 23540 | 51321 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenues and customer advances | 125498 | 126797 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 322183 | 300377 |
| Income taxes payable | 4046 | 4046 |
| Long-term debt | 591500 | 591500 |
| Operating lease liabilities | 53630 | 52738 |
| Other non-current liabilities | 11224 | 12642 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 982583 | 961303 |
| Commitments and contingencies (Note M) |  |  |
| Shareholders' equity: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Preferred stock, $0.01 par value; 1,000,000 shares authorized; no shares issued or outstanding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Common stock, $0.01 par value; 85,000,000 shares authorized; 59,426,779 and 59,003,174 shares issued and outstanding at September 26, 2025 and June 27, 2025, respectively | 594 | 590 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additional paid-in capital | 1301397 | 1287478 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained earnings | 169380 | 181895 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated other comprehensive income | 3638 | 3498 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | 1475009 | 1473461 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and shareholders' equity | $2457592 | $2434764 |

---

The accompanying notes are an integral part of the consolidated financial statements.

------

**MERCURY SYSTEMS, INC.**

**CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS**

(In thousands, except per share data)

(Unaudited)

---

| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| | **September 26, 2025** | **September 27, 2024** |
| Net revenues | $225209 | $204431 |
| Cost of revenues | 162310 | 152641 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross margin | 62899 | 51790 |
| Operating expenses: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Selling, general and administrative | 45906 | 33153 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Research and development | 13184 | 18383 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of intangible assets | 10259 | 11235 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restructuring and other charges | 1584 | 2260 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Acquisition costs and other related expenses | 563 | 177 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 71496 | 65208 |
| Loss from operations | (8597) | (13418) |
| Interest income | 2027 | 544 |
| Interest expense | (7886) | (8906) |
| Other expense, net | (2080) | (1339) |
| Loss before income tax benefit | (16536) | (23119) |
| Income tax benefit | (4021) | (5594) |
| Net loss | $(12515) | $(17525) |
| Basic net loss per share | $(0.21) | $(0.30) |
| Diluted net loss per share | $(0.21) | $(0.30) |
| Weighted-average shares outstanding: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic | 59191 | 58260 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted | 59191 | 58260 |
| Comprehensive loss: |  |  |
| Net loss | $(12515) | $(17525) |
| Change in fair value of derivative instruments, net of tax | (256) | (5885) |
| Foreign currency translation adjustments | 437 | (320) |
| Deferred compensation and pension benefit plan, net of tax | (41) | (54) |
| Total other comprehensive income (loss), net of tax | 140 | (6259) |
| Total comprehensive loss | $(12375) | $(23784) |

---

The accompanying notes are an integral part of the consolidated financial statements.

------

**MERCURY SYSTEMS, INC.**

**CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY**

(In thousands)

(Unaudited)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **For the First Quarter Ended September 26, 2025** | **For the First Quarter Ended September 26, 2025** | **For the First Quarter Ended September 26, 2025** | **For the First Quarter Ended September 26, 2025** | **For the First Quarter Ended September 26, 2025** | **For the First Quarter Ended September 26, 2025** |
| | **Common Stock** | **Common Stock** | **Additional<br>Paid-in<br>Capital** | **Retained<br>Earnings** | **Accumulated<br>Other<br>Comprehensive<br>Income** | **Total<br>Shareholders'<br>Equity** |
| | **Shares** | **Amount** | **Additional<br>Paid-in<br>Capital** | **Retained<br>Earnings** | **Accumulated<br>Other<br>Comprehensive<br>Income** | **Total<br>Shareholders'<br>Equity** |
| Balance at June 27, 2025 | 59003 | $590 | $1287478 | $181895 | $3498 | $1473461 |
| Issuance of common stock under employee stock incentive plans | 345 | 3 | (3) |  |  |  |
| Issuance of common stock under defined contribution plan | 79 | 1 | 5205 |  |  | 5206 |
| Stock-based compensation |  |  | 8717 |  |  | 8717 |
| Net loss |  |  |  | (12515) |  | (12515) |
| Other comprehensive income |  |  |  |  | 140 | 140 |
| Balance at September 26, 2025 | 59427 | $594 | $1301397 | $169380 | $3638 | $1475009 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **For the First Quarter Ended September 27, 2024** | **For the First Quarter Ended September 27, 2024** | **For the First Quarter Ended September 27, 2024** | **For the First Quarter Ended September 27, 2024** | **For the First Quarter Ended September 27, 2024** | **For the First Quarter Ended September 27, 2024** |
| | **Common Stock** | **Common Stock** | **Additional<br>Paid-in<br>Capital** | **Retained<br>Earnings** | **Accumulated<br>Other<br>Comprehensive<br>Income** | **Total<br>Shareholders'<br>Equity** |
| | **Shares** | **Amount** | **Additional<br>Paid-in<br>Capital** | **Retained<br>Earnings** | **Accumulated<br>Other<br>Comprehensive<br>Income** | **Total<br>Shareholders'<br>Equity** |
| Balance at June 28, 2024 | 58094 | $581 | $1242402 | $219799 | $9993 | $1472775 |
| Issuance of common stock under employee stock incentive plans | 235 | 2 | (2) |  |  |  |
| Issuance of common stock under defined contribution plan | 126 | 1 | 4511 |  |  | 4512 |
| Stock-based compensation |  |  | 6338 |  |  | 6338 |
| Net loss |  |  |  | (17525) |  | (17525) |
| Other comprehensive loss |  |  |  |  | (6259) | (6259) |
| Balance at September 27, 2024 | 58455 | $584 | $1253249 | $202274 | $3734 | $1459841 |

---

The accompanying notes are an integral part of the consolidated financial statements.

------

**MERCURY SYSTEMS, INC.**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

(In thousands)

(Unaudited)

---

| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| | **September 26, 2025** | **September 27, 2024** |
| Cash flows from operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss | $(12515) | $(17525) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization expense | 18913 | 21220 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation expense | 9573 | 6092 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based matching contributions on defined contribution plan | 6750 | 4432 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Benefit for deferred income taxes | (3855) | (7847) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for bad debt | (36) | 218 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-cash items | 288 | 2707 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, unbilled receivables, and costs in excess of billings | 20138 | (6148) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory | (12129) | (13907) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid income taxes | (933) | (63) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | (35317) | 1982 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-current assets | (2097) | 1840 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable, accrued expenses, and accrued compensation | 20893 | (27004) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenues and customer advances | (8339) | 21239 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable | 8 | 978 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-current liabilities | 840 | (2874) |
| Net cash provided by (used in) operating activities | 2182 | (14660) |
| Cash flows from investing activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchases of property and equipment | (6548) | (6236) |
| Net cash used in investing activities | (6548) | (6236) |
| Cash flows from financing activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payments of deferred financing and offering costs |  | (2249) |
| Net cash used in financing activities |  | (2249) |
| Effect of exchange rate changes on cash and cash equivalents | (17) | 747 |
| Net decrease in cash and cash equivalents | (4383) | (22398) |
| Cash and cash equivalents at beginning of period | 309099 | 180521 |
| Cash and cash equivalents at end of period | $304716 | $158123 |
| Cash paid (refunded) during the period for: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest | $8523 | $8898 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes paid (refunded), net | $486 | $(923) |
| Supplemental disclosures—non-cash activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash investing activity: Purchases of property and equipment incurred but not yet paid | $3298 | $3300 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash investing activity: Inventory transfer to property and equipment, net | $4444 | $— |

---

The accompanying notes are an integral part of the consolidated financial statements.

------

**MERCURY SYSTEMS, INC.**

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

(Amounts in thousands except per share data)

(Unaudited)

**A.Description of Business**

Mercury Systems, Inc. (the Company) is a global technology company that delivers mission-critical processing to the edge—where signals and data are collected—to solve the most pressing aerospace and defense challenges. Mercury's products and solutions are deployed in more than 300 programs, and across 35 countries. The Company is headquartered in Andover, Massachusetts, and has over 20 locations worldwide.

The Mercury Processing Platform is the unique advantage the Company provides to its customers. It comprises the innovative technologies the Company has developed and acquired for more than 40 years that bring integrated, mission-critical processing to the edge. The Company's processing platform spans the full breadth of signal processing—from radio frequency ("RF") front end to the human-machine interface—to rapidly convert meaningful data, gathered in the most remote and hostile environments, into critical decisions. It allows the Company to offer standard products and custom solutions from silicon to system scale, including components, modules, subsystems, and systems and it embodies the customer-centric approach the Company takes to delivering capabilities that are mission-ready, trusted and secure, software-defined, and open and modular.

**B.Summary of Significant Accounting Policies**

BASIS OF PRESENTATION

The accompanying consolidated financial statements have been prepared by the Company in accordance with Generally Accepted Accounting Principles ("GAAP") in the United States of America for interim financial information and with the instructions to the Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in annual consolidated financial statements have been condensed or omitted pursuant to those rules and regulations; however, in the opinion of management the financial information reflects all adjustments, consisting of adjustments of a normal recurring nature, necessary for fair presentation. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes for the fiscal year ended June 27, 2025, which are contained in the Company's Annual Report on Form 10-K filed with the SEC on August 11, 2025. The results for the first quarter ended September 26, 2025 are not necessarily indicative of the results to be expected for the full fiscal year.

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

All references to the first quarter of fiscal 2026 are to the quarter ended September 26, 2025. There were 13 weeks during the first quarters ended September 26, 2025 and September 27, 2024, respectively.

USE OF ESTIMATES

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

FOREIGN CURRENCY

Local currencies are the functional currency for the Company's subsidiaries in Switzerland, the United Kingdom, and Spain. The accounts of foreign subsidiaries are translated using exchange rates in effect at period-end for assets and liabilities and at average exchange rates during the period for results of operations. The related translation adjustments are reported in Accumulated other comprehensive income ("AOCI") in shareholders' equity. Gains (losses) resulting from non-U.S. currency transactions are included in Other expense, net in the Consolidated Statements of Operations and Comprehensive Loss and were immaterial for all periods presented.

ACCOUNTS RECEIVABLE

Accounts receivable, net, represents amounts that have been billed and are currently due from customers. The Company maintains an allowance for credit losses to provide for the estimated amount of receivables that will not be collected. The Company provides credit to customers in the normal course of business. The Company performs ongoing credit evaluations of its customers' financial condition and limits the amount of credit extended as necessary. The allowance is based upon an assessment of the customer's credit worthiness, reasonable forecasts about the future, history with the customer, and the age of the receivable balance. The Company typically invoices a customer upon shipment of the product (or completion of a service)

------

for contracts where revenue is recognized at a point in time. For contracts where revenue is recognized over time, the invoicing events are typically based on specified performance obligation deliverables or milestone events, or quantifiable measures of performance.

ACCOUNTS RECEIVABLES FACTORING

On August 13, 2024, the Company entered into a $60,000 committed receivables purchase and servicing agreement ("RPSA"). The RPSA has an initial term of two years. Pursuant to the RPSA, the counterparty has committed to purchase receivables from a certain number of agreed upon customers, maintaining a balance of purchased receivables at or below $60,000. Under the RPSA, a portion of the factored receivables is paid by the counterparty in cash and classified as a deferred purchase price receivable, which is paid as receivables are collected by the Company.

Proceeds for amounts factored by the Company are recorded as an increase to cash and a reduction to accounts receivable outstanding in the Consolidated Balance Sheets. Cash flows attributable to factored receivables are reflected as cash flows from operating activities in the Company's Consolidated Statements of Cash Flows. Factoring fees are included as Selling, general and administrative expenses in the Company's Consolidated Statements of Operations and Comprehensive Loss.

The Company had $45,468 and $419 of factored accounts receivables and factoring fees, respectively, for the first quarter ended September 26, 2025. The Company had $43,659 and $362 of factored accounts receivables and factoring fees, respectively, for the first quarter ended September 27, 2024.

DERIVATIVES

The Company records the fair value of its derivative financial instruments in its consolidated financial statements in Other non-current assets, or Other non-current liabilities depending on their net position, regardless of the purpose or intent for holding the derivative contract. Changes in the fair value of the derivative financial instruments are either recognized periodically in earnings or in shareholders' equity as a component of Other comprehensive income (loss) ("OCI"). Changes in the fair value of cash flow hedges that qualify for hedge accounting treatment are recorded in OCI and reclassified into earnings in the same line item on the Consolidated Statements of Operations and Comprehensive Loss as the impact of the hedged transaction when the underlying contract matures and, for interest rate exposure derivatives, over the term of the corresponding debt instrument. Changes in the fair values of derivatives not qualifying for hedge accounting are reported in earnings as they occur. All derivatives for the Company qualified for hedge accounting as of September 26, 2025.

REVENUE RECOGNITION

The Company recognizes revenue in accordance with ASC 606, *Revenue from Contracts with Customers*, ("ASC 606"). Revenues are derived from the sales of products that are grouped into one of the following three categories: (i) components; (ii) modules and sub-assemblies; and (iii) integrated solutions. The Company also generates revenues from the performance of services, including systems engineering support, consulting, maintenance and other support, testing and installation. Each promised good or service within a contract is accounted for separately under the guidance of ASC 606 if they are distinct. Promised goods or services not meeting the criteria for being a distinct performance obligation are bundled into a single performance obligation with other goods or services that together meet the criteria for being distinct. The appropriate allocation of the transaction price and recognition of revenue is then determined for the bundled performance obligation.

Revenue recognized at a point in time generally relates to contracts that include a combination of components, modules and sub-assemblies, integrated solutions and related system integration or other services. Contracts with distinct performance obligations recognized at a point in time, with or without an allocation of the transaction price, totaled 52% and 45% of revenues for the first quarters ended September 26, 2025 and September 27, 2024, respectively.

The Company also engages in contracts for development, production and service activities and recognizes revenue for performance obligations over time. These over time contracts involve the design, development, manufacture, or modification of complex modules and sub-assemblies or integrated solutions and related services. Over time contracts include both fixed-price and cost reimbursable contracts. The Company's cost reimbursable contracts typically include cost-plus fixed fee and time and material contracts.

Total revenue recognized over time was 48% and 55% of total revenues for the first quarters ended September 26, 2025 and September 27, 2024, respectively.

Accounting for contracts recognized over time requires significant judgment relative to estimating total contract revenues and costs. In particular, this includes assumptions relative to the amount of time to complete the contract and the assessment of the nature and complexity of the work to be performed and the impact of contract amendments which may result in cumulative adjustments. The Company's estimates are based upon the professional knowledge and experience of its engineers, operations, program managers and other personnel, who review each over time contract monthly to assess the contract's schedule, performance, technical matters and estimated cost at completion. Changes in estimates are applied retrospectively and when adjustments in estimated contract costs are identified, such revisions may result in current period adjustments to earnings

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applicable to performance in prior periods. The aggregate effects of these favorable and unfavorable changes across the Company's portfolio of programs can have a significant effect upon its reported Loss from operations, Net loss and Diluted net loss per share in each of the reporting periods. The net impact of changes in estimates had the following impact on the Company's operating results:

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| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| *(In thousands, except per share data)* | **September 26, 2025** | **September 27, 2024** |
| Loss from operations | $(4050) | $(8293) |
| Net loss<sup>(1)</sup> | $(2957) | $(6054) |
| Diluted net loss per share | $(0.05) | $(0.10) |
| Diluted Shares | 59191 | 58260 |
| (1) Federal and state statutory rate of 27% |  |  |

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The Company generally does not provide its customers with rights of product return other than those related to assurance warranty provisions that permit repair or replacement of defective goods generally over a period of 12 to 36 months. The Company accrues for anticipated warranty costs upon product shipment. The Company does not consider activities related to such assurance warranties, if any, to be a separate performance obligation. The Company does offer separately priced extended warranties which generally range from 12 to 36 months that are treated as separate performance obligations. The transaction price allocated to extended warranties is recognized over time in proportion to the costs expected to be incurred in satisfying the obligations under the contract.

The Company's contracts generally do not include significant financing components. The Company's over time contracts may include milestone payments, which align the payment schedule with the progress towards completion on the performance obligation. Otherwise, the Company's contracts are predicated on payment upon completion of the performance obligation. On certain contracts, the Company may be entitled to receive an advance payment, which is not considered a significant financing component because most contracts have a duration of approximately two years on average and it is used to facilitate inventory demands at the onset of a contract and to safeguard the Company from the failure of the other party to abide by some or all of their obligations under the contract.

All revenues are reported net of government assessed taxes (e.g., sales taxes or value-added taxes). Refer to Note L for disaggregation of revenue for the period.

CONTRACT BALANCES&nbsp;&nbsp;&nbsp;&nbsp;

Contract balances result from the timing of revenue recognized, billings and cash collections resulting in the generation of contract assets and liabilities. Contract assets represent revenue recognized in excess of amounts invoiced to the customer and the right to payment is not subject to the passage of time. Instead, while the Company has an enforceable right to payment as progress is made over performance obligations, billings to customers are generally predicated on (i) completion of defined milestones, (ii) monthly costs incurred or (iii) final delivery of goods or services. Contract assets are presented as Unbilled receivables and costs in excess of billings, net of allowance for credit losses on the Company's Consolidated Balance Sheets. Contract liabilities consist of deferred product revenue, billings in excess of revenues, deferred service revenue and customer advances. Deferred product revenue represents amounts that have been invoiced to customers, but are not yet recognizable as revenue because the Company has not satisfied its performance obligations under the contract. Billings in excess of revenues represents milestone billing contracts where the billings of the contract exceed recognized revenues. Deferred service revenue primarily represents amounts invoiced to customers for annual maintenance contracts or extended warranty contracts, which are recognized over time in proportion to the costs expected to be incurred in satisfying the obligations under the contract. Customer advances represent deposits received from customers on an order. Contract liabilities are included in deferred revenue as well as Other non-current liabilities on the Company's Consolidated Balance Sheets. Contract balances are reported in a net position on a contract-by-contract basis.

The contract asset balances were $274,835 and $278,475 as of September 26, 2025 and June 27, 2025, respectively. The contract asset balance decreased due to $111,295 of billings, partially offset by revenue recognized under over time contracts of $107,655 during the first quarter ended September 26, 2025. The contract liability balances were $125,871 and $127,605 as of September 26, 2025 and June 27, 2025, respectively. The contract liability decreased due to the timing of revenue recognized across multiple programs.

Revenue recognized for the first quarter ended September 26, 2025 that was included in the contract liability balance at June 27, 2025 was $39,642. Revenue recognized for the first quarter ended September 27, 2024 that was included in the contract liability balance at June 28, 2024 was $26,411.

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REMAINING PERFORMANCE OBLIGATIONS

The Company includes in its computation of remaining performance obligations customer orders for which it has accepted executed sales orders. The definition of remaining performance obligations excludes contracts with original expected durations of less than one year, as well as those contracts that provide the customer with the right to cancel or terminate the order with no substantial penalty, even if the Company's historical experience indicates the likelihood of cancellation or termination is remote. As of September 26, 2025, the aggregate amount of the transaction price allocated to remaining performance obligations was $782,643. The Company expects to recognize approximately 54% of its remaining performance obligations as revenue in the next 12 months and the balance thereafter.

LONG-LIVED ASSETS

Long-lived assets primarily include property and equipment, intangible assets and right-of-use ("ROU") assets. The Company regularly evaluates its long-lived assets for events and circumstances that indicate a potential impairment in accordance with ASC 360, *Property, Plant and Equipment* ("ASC 360"). The Company reviews long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test is based on a comparison of the estimated undiscounted cash flows of the asset as compared to the recorded value of the asset. If impairment is indicated, the asset is written down to its estimated fair value.

GOODWILL AND INTANGIBLE ASSETS

Goodwill is the amount by which the purchase price of a business acquisition exceeded the fair values of the net identifiable assets on the date of purchase (see Note F). In accordance with the requirements of Intangibles-Goodwill and Other ("ASC 350"), goodwill is not amortized. Goodwill is assessed for impairment at least annually, on a reporting unit basis, or when events and circumstances ("triggering event") occur indicating that the recorded goodwill may be impaired. Potential triggering events include macroeconomic conditions, industry and market considerations, financial performance and expectations of projected financial performance and cash flows, and changes in the Company's stock price in relation to the carrying value of its reporting units, among other relevant factors. Adverse changes to these events and circumstances could require the Company to perform an interim impairment test.

Intangible assets result from the Company's various business acquisitions and certain licensed technologies, and consist of identifiable intangible assets, including completed technology, licensing agreements, patents, customer relationships, trademarks, backlog and non-compete agreements. Intangible assets are reported at cost, net of accumulated amortization and are either amortized on a straight-line basis over their estimated useful lives of up to 12.5 years or over the period the economic benefits of the intangible asset are consumed.

PRODUCT WARRANTY ACCRUAL

The Company's product sales generally include a 12 to 36 month standard hardware warranty. At time of product shipment, the Company accrues for the estimated cost to repair or replace potentially defective products. Estimated warranty costs are based upon prior actual warranty costs for substantially similar transactions and any specifically identified warranty requirements. Product warranty accrual is included as part of accrued expenses in the accompanying Consolidated Balance Sheets. The following table presents the changes in the Company's product warranty accrual.

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| | |
|:---|:---|
| | **Total** |
| Balance at June 27, 2025 | $2945 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accruals for warranties issued during the period | 704 |
| &nbsp;&nbsp;&nbsp;&nbsp; Settlements made during the period | (897) |
| Balance at September 26, 2025 | $2752 |

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WEIGHTED-AVERAGE SHARES

Weighted-average shares were calculated as follows:

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| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| | **September 26, 2025** | **September 27, 2024** |
| Basic weighted-average shares outstanding | 59191 | 58260 |
| Effect of dilutive equity instruments |  |  |
| Diluted weighted-average shares outstanding | 59191 | 58260 |

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Equity instruments to purchase 2,590 and 2,694 shares of common stock were not included in the calculation of diluted net loss per share for the first quarters ended September 26, 2025 and September 27, 2024, respectively, because the equity instruments were anti-dilutive.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In November 2024, the FASB issued ASU No. 2024-03, *Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures*, an amendment of the FASB Accounting Standard Codification. The amendments in this ASU address improvements to disclosures surrounding operating expenses, including purchases of inventory, employee compensation, depreciation, amortization, and depletion, which are all normally included in common expense captions on the face of the income statement. Any expenses remaining in relevant expense captions that are not disaggregated should be accompanied with a qualitative disclosure as to their nature. This ASU is effective for fiscal years beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the effect that this standard will have on its consolidated financial statements and related disclosures.

In May 2025, the FASB issued ASU No. 2025-03, *Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity,* an amendment of the FASB Accounting Standards Codification. The amendments in this ASU are intended to clarify guidance surrounding who the accounting acquirer is in a business combination, specifically when a Variable Interest Entity ("VIE") is involved. The ASU is effective for fiscal years beginning after December 15, 2026, and all interim periods within applicable annual periods, with early adoption permitted. The Company is currently evaluating the effect that this standard will have on its consolidated financial statements and related disclosures.

In July 2025, the FASB issued ASU No. 2025-05, *Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets,* an amendment of the FASB Accounting Standards Codification. The amendments in this ASU affect entities that apply the practical expedient and accounting policy election (if applicable) when estimating expected credit losses on current accounts receivable and/or current contract assets arising from transactions under Topic 606, including those assets acquired in a transaction accounted for under Topic 805, Business Combinations. The ASU is effective for fiscal years beginning after December 15, 2025, and all interim periods within applicable annual periods, with early adoption permitted. The Company is currently evaluating the effect that this standard will have on its consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU No. 2025-06, *Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal Use Software,* an amendment of the FASB Accounting Standards Codification. The amendments in this ASU apply to all entities subject to the internal-use software guidance in Subtopic 350-40. The main provisions are improving operability of the guidance and removing references of different software development stages to remain neutral to different methods. The ASU is effective for fiscal years beginning after December 15, 2027, and all interim periods within applicable annual periods, with early adoption permitted at beginning of annual reporting period. The Company is currently evaluating the effect that this standard will have on its consolidated financial statements and related disclosures.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

Effective June 28, 2025, the company adopted ASU No. 2023-09, *Improvement to Income Tax Disclosures*, an amendment of the FASB Accounting Standards Codification. The amendments in this ASU enact new income tax disclosure requirements in addition to modifying existing requirements. The amendment requires entities to categorize and provide greater disaggregation of information in the rate reconciliation and income taxes paid disclosures. The adoption of this update did not have a material impact on the Company's consolidated financial statements but will result in expanded income tax disclosures in the Company's annual financial statements for the fiscal period ending July 3, 2026.

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**C.Fair Value of Financial Instruments**

The following table summarizes the Companies' financial instruments measured at fair value on a recurring basis as of September 26, 2025:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Fair Value Measurements** | **Fair Value Measurements** | **Fair Value Measurements** | **Fair Value Measurements** |
| | **September 26, 2025** | **Level 1** | **Level 2** | **Level 3** |
| Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest rate swap | $4778 | $— | $4778 | $— |
| Total measured at fair value | $4778 | $— | $4778 | $— |

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The carrying values of cash and cash equivalents, including money market funds, restricted cash, accounts receivable and payable, contract assets and liabilities and accrued liabilities approximate fair value due to the short-term maturities of these assets and liabilities. The Company determined the carrying value of long-term debt approximated fair value due to variable interest rates charged on the borrowings, which reprice frequently.

During the first quarter ended September 29, 2023, the Company entered into an interest rate hedging agreement (the "September 2023 Swap"). The fair value of the September 2023 Swap is estimated using a discounted cash flow analysis based on the contractual terms of the derivative, leveraging observable inputs other than quoted prices, such as interest rates. As of September 26, 2025, the fair value of the September 2023 Swap was a liability of $4,778 and is included within Other non-current liabilities in the Company's Consolidated Balance Sheets.

The following table summarizes the Companies' financial instruments measured at fair value on a recurring basis as of June 27, 2025:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Fair Value Measurements** | **Fair Value Measurements** | **Fair Value Measurements** | **Fair Value Measurements** |
| | **June 27, 2025** | **Level 1** | **Level 2** | **Level 3** |
| Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest rate swap | $5391 | $— | $5391 | $— |
| Total measured at fair value | $5391 | $— | $5391 | $— |

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The fair value of the September 2023 Swap is estimated using a discounted cash flow analysis based on the contractual terms of the derivative, leveraging observable inputs other than quoted prices, such as interest rates. As of June 27, 2025, the fair value of the September 2023 Swap was a liability of $5,391 and was included within Other non-current liabilities in the Company's Consolidated Balance Sheets.

Refer to Note N for further information regarding the September 2023 Swap.

**D.Inventory**

Inventory is stated at the lower of cost (first-in, first-out) or net realizable value, and consists of materials, labor and overhead. On a quarterly basis, the Company uses consistent methodologies to evaluate inventory for net realizable value. Once an item is written down, the value becomes the new inventory cost basis. The Company reduces the value of inventory for excess and obsolete inventory, consisting of on-hand inventory in excess of estimated usage. The excess and obsolete inventory evaluation is based upon assumptions about future demand, historical usage, product mix and possible alternative uses. During the first quarter ended September 26, 2025, the Company reclassified $4,444 of work in process inventory to property and equipment, net to support a test lab and demonstration room for its technologies and to meet anticipated production demands for its solutions through additional testing capabilities. Inventory was comprised of the following:

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| | | |
|:---|:---|:---|
| | **As of** | **As of** |
| | **September 26, 2025** | **June 27, 2025** |
| Raw materials | $191876 | $195496 |
| Work in process | 126109 | 118376 |
| Finished goods | 22261 | 19048 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $340246 | $332920 |

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**E.Property and Equipment**

Property and equipment, net consisted of the following:

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| | | | |
|:---|:---|:---|:---|
| | **Estimated Useful Lives<br>(Years)** | **As of** | **As of** |
| | **Estimated Useful Lives<br>(Years)** | **September 26, 2025** | **June 27, 2025** |
| Computer equipment and software | 3-4 | $150827 | $149342 |
| Furniture and fixtures | 5 | 24086 | 23176 |
| Leasehold improvements | lesser of estimated useful life or lease term | 72581 | 74278 |
| Machinery and equipment | 5-10 | 177676 | 168412 |
|  |  | 425170 | 415208 |
| Less: accumulated depreciation |  | (322536) | (313768) |
| Property and equipment, net |  | $102634 | $101440 |

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The $1,194 increase in property and equipment, net was primarily due to capital expenditures of $6,548 and the reclassification of work in process inventory to property and equipment of $4,444, partially offset by depreciation expense. There was no retirements of property and equipment during the first quarters ended September 26, 2025 and September 27, 2024.

Depreciation expense related to property and equipment for the first quarters ended September 26, 2025 and September 27, 2024 was $8,654 and $9,985, respectively.

**F.Goodwill**

In accordance with FASB ASC 350, *Intangibles-Goodwill and Other* ("ASC 350"), the Company determines its reporting units based upon whether discrete financial information is available, if management regularly reviews the operating results of the component, the nature of the products offered to customers and the market characteristics of each reporting unit. A reporting unit is considered to be an operating segment or one level below an operating segment also known as a component. Component level financial information is reviewed by management across two divisions: Mission Systems and Microelectronics. Accordingly, these were determined to be the Company's reporting units.

The Company performs its annual goodwill impairment test in the fourth quarter of each fiscal year. The Company also assesses potential triggering events during interim reporting periods. During the first quarter ended September 26, 2025, the Company assessed events and circumstances to consider its reporting units for a potential triggering event, including: macroeconomic conditions, industry and market considerations, financial performance and expectations of projected financial performance and cash flows, changes in the Company's stock price in relation to the carrying value of its reporting units, among other relevant factors. The Company concluded that there were no triggering events during the period that would require an interim impairment test.

There has been no change to the carrying amount of goodwill during the first quarter ended September 26, 2025.

**G.Restructuring**

&nbsp;&nbsp;&nbsp;&nbsp;During the first quarter ended September 26, 2025, the Company approved and initiated a workforce reduction that eliminated approximately 40 positions, resulting in $1,584 of severance costs. The Company incurs restructuring and other charges in connection with management's decision to undertake certain actions to realign operating expenses through workforce reductions and the closure of certain Company facilities, businesses and lines of business. All of the restructuring and other charges are classified as Operating expenses in the Consolidated Statements of Operations and Comprehensive Loss and any remaining restructuring obligations are expected to be paid within the next twelve months. The restructuring liability is classified as Accrued expenses in the Consolidated Balance Sheets.

The following table presents the detail of charges included in the Company's liability for restructuring and other charges:

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| | |
|:---|:---|
| | **Severance & Related** |
| Balance at June 27, 2025 | $1206 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restructuring charges | 1584 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash paid | (1233) |
| Balance at September 26, 2025 | $1557 |

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**H.Income Taxes** 

The Company recorded an income tax benefit of $4,021 and $5,594 on a loss before income taxes of $16,536 and $23,119 for the first quarters ended September 26, 2025 and September 27, 2024, respectively.

During the first quarters ended September 26, 2025 and September 27, 2024, the Company recognized a tax benefit of $1,120 related to stock compensation windfalls and a tax provision of $219 related to stock compensation shortfalls, respectively.

The effective tax rate for the first quarters ended September 26, 2025 and September 27, 2024 differed from the federal statutory rate primarily due to federal and state research and development credits, non-deductible compensation, and state taxes.

The Company continues to maintain a valuation allowance on all of its foreign net operating loss carryforwards and the majority of its state research and developmental tax credit carryforwards. Based on forecasted taxable income and the scheduled reversal of the remaining deferred tax assets, the Company believes it is more likely than not that all other deferred tax assets will be recognized.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted, which includes a broad range of tax provisions and extended and modified certain provisions of the Tax Cuts and Jobs Act ("TCJA"), including, but not limited to, restoration of 100% bonus depreciation, EBITDA-based interest expense limitation and immediate expensing of domestic research and development expenditures. The Company has evaluated the potential impact of this legislation and expects it to result primarily in a timing difference, with no material impact on the Company's effective tax rate.

**I.Debt** 

REVOLVING CREDIT FACILITY

The Company has a 5-year revolving credit facility (the "Revolver") with a maturity extended to February 28, 2027. The borrowing capacity as defined under the Revolver as of September 26, 2025 is approximately $900,000 less outstanding borrowings of $591,500. There were outstanding letters of credit of $5,883 as of September 26, 2025. During the first quarter ended September 26, 2025, the Company made no borrowings or repayments. As of September 26, 2025, the Company was in compliance with all covenants and conditions under the Revolver. The Company incurred interest expense of $7,886 for the first quarter ended September 26, 2025.

As of September 26, 2025, the Company's outstanding balance of unamortized deferred financing costs was $2,994, which is being amortized to Other expense, net in the Consolidated Statements of Operations and Comprehensive Loss on a straight line basis over the term of the Revolver and includes the costs incurred in conjunction with the August 2024 amendment to the Revolver.

On August 13, 2024, the Company executed Amendment No. 6 to the Revolver, decreasing the permanent borrowing capacity to $900,000, with a temporary reduction in credit availability to $750,000 until the Company meets a minimum consolidated EBITDA level, as defined in the Amendment No. 6 to the Revolver. In conjunction with Amendment No. 6 to the Revolver, the Company incurred $2,249 of new deferred financing costs that will be amortized over the remaining term of the Revolver. As part of the amendment, the Company wrote off $714 of previously deferred financing costs associated with the line of credit facility prior to the amendment. This write-off is included in Other expense, net in the Consolidated Statements of Operations and Comprehensive Loss. Refer to exhibit 10.7.6 on Form 10-K filed by the Company with the SEC on August 11, 2025.

Refer to Note O for further information regarding Amendment No. 7 to the Revolver entered into on November 4, 2025.

**J.Employee Benefit Plan**

PENSION PLAN

The Company maintains a defined benefit pension plan (the "Plan") for its Swiss employees, which is administered by an independent pension fund. The Plan is mandated by Swiss law and meets the criteria for a defined benefit plan under ASC 715, *Compensation—Retirement Benefits* ("ASC 715"), because participants of the Plan are entitled to a defined rate of return on contributions made. The independent pension fund is a multi-employer plan with unrestricted joint liability for all participating companies for which the Plan's overfunding or underfunding is allocated to each participating company based on an allocation key determined by the Plan.

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The Company recognizes a net asset or liability for the Plan equal to the difference between the projected benefit obligation of the Plan and the fair value of the Plan's assets as required by ASC 715. The funded status may vary from year to year due to changes in the fair value of the Plan's assets and variations on the underlying assumptions of the projected benefit obligation of the Plan. The Plan's funded status at September 26, 2025 was a net liability of $5,342, which is recorded in Other non-current liabilities on the Consolidated Balance Sheet. The Company recognized net periodic benefit costs of $167 and $232 associated with the Plan and a net loss of $57 and $54 in AOCI during the first quarters ended September 26, 2025 and September 27, 2024, respectively. The Company's total expected employer contributions to the Plan during fiscal 2026 are $706.

*401(k) Plan*

The Company maintains a qualified 401(k) plan (the "401(k) Plan") for its U.S. employees and matches participants' contributions to the plan and/or qualified student loan payments of up to 6% of their eligible annual compensation in Company stock. The Company may also make optional contributions to the plan for any plan year at its discretion. Stock-based 401(k) matching compensation cost is measured based on the value of the matching amount and is recognized as expense as incurred. During the first quarters ended September 26, 2025 and September 27, 2024, the Company recognized share-based matching contributions related to the 401(k) plan of $6,750 and $4,432, respectively.

*Deferred Compensation Plan*

The Company implemented a nonqualified deferred compensation plan as of January 1, 2024, under which eligible employees may defer up to 50% of their base salaries and up to 100% of their annual incentive bonuses. The Company may also make employer contributions to participant accounts in its sole discretion, and currently matches participants' deferrals under the plan of up to 6% of their eligible annual compensation in the form of deferred stock units (or at the Company's election, a cash deferral credited to participants' account balances). The Company's matching obligations for participant deferrals made during each calendar year are subject to a financial performance condition for the Company's four fiscal quarters corresponding to such calendar year. In the case of the Company's matching obligations for participant deferrals made during calendar year 2024, the financial performance condition was fully satisfied, and the deferred stock units issued in respect of the Company's matching obligations vested accordingly. Participant deferrals under the plan are held in a rabbi trust and are subject to the claims of the Company's creditors. Assets held by the rabbi trust are classified as trading securities and are recorded at fair value, with changes in value recorded as adjustments to other income. All deferrals or employer contributions under the plan, and all earnings thereon, are fully vested as and when made or credited to plan participants.

As of September 26, 2025, the Company held assets under the rabbi trust of $657, and was subject to liabilities for amounts payable under the plan to participants (including accrued employer matching contributions not yet credited to plan participants) of $657. Assets related to this plan are included in Other assets, and liabilities related to this plan are included in Other long-term liabilities in the Consolidated Balance Sheets. During the first quarters ended September 26, 2025 and September 27, 2024, the Company recognized an immaterial value of compensation expense as a result of changes in the value of notional investments selected by plan participants for the investment of their plan account balances, with the same amount being recorded as other income attributable to changes in the market value of the assets held by the rabbi trust.

**K.Stock-Based Compensation**

STOCK INCENTIVE PLANS

At September 26, 2025, the aggregate number of shares authorized for issuance under the Company's Amended and Restated 2018 Stock Incentive Plan (the "2018 Plan") is 7,862 shares, including 3,000 shares approved by the Company's shareholders on October 28, 2020 and 2,000 shares approved for future grant under the 2018 Plan by the Company's shareholders on October 26, 2022. On October 25, 2023, the Company's shareholders approved an additional 3,450 shares to be added to the 2018 plan. The 2018 Plan shares available for issuance also include 948 shares rolled into the 2018 Plan that were available for future grant under the Company's 2005 Stock Incentive Plan, as amended and restated (the "2005 Plan"). The 2018 Plan replaced the 2005 Plan. The 2018 Plan provides for the grant of non-qualified and incentive stock options, restricted stock, stock appreciation rights and deferred stock awards to employees and non-employees. Stock options must be granted with an exercise price of not less than 100% of the fair value of the Company's common stock on the date of grant and the options generally have a term of seven years. There were 2,774 available shares for future grant under the 2018 Plan at September 26, 2025.

As part of the Company's ongoing annual equity grant program for employees, the Company grants performance-based restricted stock awards to certain executives and employees pursuant to the 2018 Plan. Performance awards vest based on the requisite service period subject to the achievement of specific financial performance targets. Based on the performance targets, some of these awards require graded vesting which results in more rapid expense recognition compared to traditional time-based vesting over the same vesting period. The Company monitors the probability of achieving the performance targets on a

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quarterly basis and may adjust periodic stock compensation expense accordingly based on its determination of the likelihood for reaching targets. The performance targets generally include the achievement of financial performance goals, either on an absolute basis or relative to a peer group of companies. Payouts under performance-based restricted stock awards may also be subject to modification based on Mercury's total shareholder return relative to the component companies within the Spade Defense Index.

EMPLOYEE STOCK PURCHASE PLAN

The Company's 1997 Employee Stock Purchase Plan, as amended and restated (the "1997 ESPP") was terminated in accordance with its terms effective May 14, 2024. Under the 1997 ESPP, rights were granted to purchase shares of common stock at 85% of the lesser of the market value of such shares at either the beginning or the end of each six-month offering period. The 1997 ESPP permitted employees to purchase common stock through payroll deductions, which may not have exceeded 10% of an employee's compensation as defined in the 1997 ESPP. There were no shares issued under the 1997 ESPP during the first quarters ended September 26, 2025 and September 27, 2024, respectively.

The Company adopted a new employee stock purchase plan (the "2024 ESPP") in April 2024. The Company's shareholders approved the plan at the Company's 2024 annual meeting of shareholders, held on October 23, 2024. The number of shares authorized for issuance under the 2024 ESPP is 1,000 shares. Under the 2024 ESPP, rights are granted to purchase shares of common stock at 85% of the lesser of the market value of such shares at either the beginning or the end of each six-month offering period. The 2024 ESPP permits employees to purchase common stock through payroll deductions, which may not exceed 10% of an employee's compensation as defined in the 2024 ESPP. There were no shares issued under the 2024 ESPP during the first quarters ended September 26, 2025 and September 27, 2024, respectively. Shares available for future purchase under the 2024 ESPP totaled 870 at September 26, 2025.

STOCK OPTION AND AWARD ACTIVITY

The following table summarizes activity with respect to Company-issued stock options since June 27, 2025:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Options Outstanding** | **Options Outstanding** | **Options Outstanding** | **Options Outstanding** | |
| | **Number of<br>Shares** | **Weighted Average<br>Grant Date<br>Fair Value** | **Weighted Average<br>Exercise Price** | **Weighted Average<br>Remaining<br>Contractual Term<br>(Years)** | **Aggregate<br>Intrinsic Value as of September 26, 2025** |
| Outstanding at June 27, 2025 | 934 | $12.71 | $45.00 |  |  |
| Granted |  |  |  |  |  |
| Exercised |  |  |  |  |  |
| Canceled |  |  |  |  |  |
| Outstanding at September 26, 2025 | 934 | 12.71 | 45.00 | 2.53 years |  |
| Exercisable at September 26, 2025 |  | $— | $— |  |  |

---

There were no options vested or exercised during the first quarter ended September 26, 2025. Non-vested stock options are subject to the risk of forfeiture until the fulfillment of specified conditions. As of September 26, 2025, there was $4,943 of total unrecognized compensation cost related to non-vested options granted that is expected to be recognized over a weighted-average period of 1.53 years from September 26, 2025.

The following table summarizes the status of the Company's non-vested restricted stock awards and deferred stock awards since June 27, 2025:

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| | | |
|:---|:---|:---|
| | **Non-vested Restricted Stock Awards** | **Non-vested Restricted Stock Awards** |
| | **Number of<br>Shares** | **Weighted Average<br>Grant Date<br>Fair Value** |
| Outstanding at June 27, 2025 | 1742 | $40.37 |
| Granted | 543 | 66.68 |
| Vested | (345) | 39.91 |
| Forfeited | (45) | 42.58 |
| Outstanding at September 26, 2025 | 1895 | $48.00 |

---

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STOCK-BASED COMPENSATION EXPENSE

The Company recognizes expense for its share-based payment plans in the Consolidated Statements of Operations and Comprehensive Loss in accordance with ASC 718, *Compensation - Stock Compensation* ("ASC 718"). Under the fair value recognition provisions of ASC 718, stock-based compensation cost is measured at the grant date based on the value of the award and is recognized as expense over the service period, net of estimated forfeitures.

The following table presents share-based compensation expenses included in the Company's Consolidated Statements of Operations and Comprehensive Loss:

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| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| | **September 26, 2025** | **September 27, 2024** |
| Cost of revenues | $1760 | $113 |
| Selling, general and administrative | 6296 | 4611 |
| Research and development | 1517 | 1368 |
| Stock-based compensation expense before tax | 9573 | 6092 |
| Income taxes<sup>(1)</sup> | (2585) | (1645) |
| Stock-based compensation expense, net of income taxes | $6988 | $4447 |
| (1) Federal and state statutory rate of 27% |  |  |

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**L.Operating Segment, Geographic Information and Significant Customers**

Operating segments are defined as components of an enterprise evaluated regularly by the Company's chief executive officer who acts as its Chief Operating Decision Maker ("CODM") in deciding how to allocate resources and assess performance. The Company evaluated its internal organization under FASB ASC 280, *Segment Reporting* ("ASC 280") to determine whether there has been a change to its conclusion of a single operating and reportable segment. The Company concluded there has been no changes given the CODM continues to evaluate and manage the Company on the basis of one operating and reportable segment. The Company utilized the management approach for determining its operating segment in accordance with ASC 280.

The CODM utilizes Net loss that is reported on the Consolidated Statement of Operations and Comprehensive Loss to assess operating performance and make decisions related to resource allocation. The Company's significant segment expenses include stock-based compensation and depreciation which are disclosed in Note K and Note E, respectively. Any other significant segment expenses which are regularly provided to the CODM are provided on the Consolidated Statement of Operations and Comprehensive Loss. The Company's segment assets are reported on the Consolidated Balance Sheets as Total Assets and its segment purchase of property plant and equipment are disclosed in Note E.

The geographic distribution of the Company's revenues as determined by country in which the Company's legal subsidiary is domiciled is summarized as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **U.S.** | **Europe** | **Eliminations** | **Total** |
| FIRST QUARTER ENDED SEPTEMBER 26, 2025 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net revenues to unaffiliated customers | $211998 | $13211 | $— | $225209 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inter-geographic revenues | 2301 | 2486 | (4787) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net revenues | $214299 | $15697 | $(4787) | $225209 |
| FIRST QUARTER ENDED SEPTEMBER 27, 2024 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net revenues to unaffiliated customers | $192660 | $11771 | $— | $204431 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inter-geographic revenues | 2055 | 2819 | (4874) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net revenues | $194715 | $14590 | $(4874) | $204431 |

---

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The geographic distribution of the Company's identifiable long-lived assets is summarized as follows:

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| | | | |
|:---|:---|:---|:---|
| | **U.S.** | **Europe** | **Total** |
| September 26, 2025 | $101658 | $976 | $102634 |
| June 27, 2025 | $100484 | $956 | $101440 |

---

Identifiable long-lived assets exclude right-of-use assets, goodwill, and intangible assets.

The Company offers a broad family of products and processing solutions designed to meet the full range of requirements in compute-intensive, signal processing, image processing and command and control applications. To maintain a competitive advantage, the Company seeks to leverage technology investments across multiple lines of business and product solutions.

The Company's products are typically compute-intensive and require extremely high bandwidth and high throughput. These processing solutions often must also meet significant size, weight and power ("SWaP") constraints for use in aircraft, unmanned aerial vehicles, ships and other platforms and be ruggedized for use in harsh environments. The Company's products transform the massive streams of digital data created in these applications into usable information in real time. The systems can scale from a few processors to thousands of processors.

In recent years, the Company completed a series of acquisitions that changed its technological capabilities, applications and end markets. As these acquisitions and changes occurred, the Company's proportion of revenue derived from the sale of components in different technological areas, and modules, sub-assemblies and integrated solutions which combine technologies into more complex diverse products has shifted. The following tables present revenue consistent with the Company's strategy of expanding its technological capabilities and program content. As additional information related to the Company's products by end user, application, product grouping and/or platform is attained, the categorization of these products can vary over time. When this occurs, the Company reclassifies revenue by end user, application, product grouping and/or platform for prior periods. Such reclassifications typically do not materially change the underlying trends of results within each revenue category.

The following table presents the Company's net revenue by end user for the periods presented:

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| | | |
|:---|:---|:---|
|  | **First Quarters Ended** | **First Quarters Ended** |
|  | **September 26, 2025** | **September 27, 2024** |
| Domestic<sup>(1)</sup> | $187923 | $161194 |
| International/Foreign Military Sales<sup>(2)</sup> | 37286 | 43237 |
| Total Net Revenue | $225209 | $204431 |

---

(1) Domestic revenues consist of sales where the end user is within the U.S., as well as sales to prime defense contractor customers where the ultimate end user location is not defined.

(2) International/Foreign Military Sales consist of sales to U.S. prime defense contractor customers where the end user is outside the U.S., foreign military sales through the U.S. government, and direct sales to non-U.S. based customers intended for end use outside of the U.S.

The following table presents the Company's net revenue by end application for the periods presented:

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| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| | **September 26, 2025** | **September 27, 2024** |
| Radar<sup>(1)</sup> | $30190 | $33749 |
| Electronic Warfare<sup>(2)</sup> | 20999 | 26346 |
| Other Sensor & Effector<sup>(3)</sup> | 29765 | 26366 |
| Total Sensor & Effector | 80954 | 86461 |
| C4I<sup>(4)</sup> | 111466 | 85280 |
| Other<sup>(5)</sup> | 32789 | 32690 |
| Total Net Revenue | $225209 | $204431 |

---

(1) Radar includes end-use applications where radio frequency signals are utilized to detect, track and identify objects.

(2) Electronic Warfare includes end-use applications comprising the offensive and defensive use of the electromagnetic spectrum.

(3) Other Sensor and Effector products include all Sensor and Effector end markets other than Radar and Electronic Warfare.

(4) C4I includes rugged secure rackmount servers that are designed to drive the most powerful military processing applications.

(5) Other products include all component and other sales where the end use is not specified.

The following table presents the Company's net revenue by product grouping for the periods presented:

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---

| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| | **September 26, 2025** | **September 27, 2024** |
| Components<sup>(1)</sup> | $45499 | $44864 |
| Modules and Sub-assemblies<sup>(2)</sup> | 66196 | 45822 |
| Integrated Solutions<sup>(3)</sup> | 113514 | 113745 |
| Total Net Revenue | $225209 | $204431 |

---

(1) Components represent the basic building blocks of an electronic system. They generally perform a single function such as switching, storing or converting electronic signals. Some examples include power amplifiers and limiters, switches, oscillators, filters, equalizers, digital and analog converters, chips, MMICs (monolithic microwave integrated circuits) and memory and storage devices.

(2) Modules and sub-assemblies combine multiple components to serve a range of complex functions, including processing, networking and graphics display. Typically delivered as computer boards or other packaging, modules and sub-assemblies are usually designed using open standards to provide interoperability when integrated in a subsystem. Examples of modules and sub-assemblies include embedded processing boards, switched fabrics and boards for high-speed input/output, digital receivers, graphics and video, along with multi-chip modules, integrated radio frequency and microwave multi-function assemblies and radio frequency tuners and transceivers.

(3) Integrated solutions bring components, modules and/or sub-assemblies into one system, enabled with software. Subsystems are typically, but not always, integrated within an open standards-based chassis and often feature interconnect technologies to enable communication between disparate systems. Spares and replacement modules and sub-assemblies are provided for use with subsystems sold by the Company. The Company's subsystems are deployed in sensor processing, aviation and mission computing and C4I applications.

The following table presents the Company's net revenue by platform for the periods presented:

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| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| | **September 26, 2025** | **September 27, 2024** |
| Airborne<sup>(1)</sup> | $94688 | $90490 |
| Land<sup>(2)</sup> | 42883 | 34314 |
| Naval<sup>(3)</sup> | 19639 | 20653 |
| Space<sup>(4)</sup> | 18475 | 15359 |
| Other<sup>(5)</sup> | 49524 | 43615 |
| Total Net Revenues | $225209 | $204431 |

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(1) Airborne platform includes products that relate to personnel, equipment or pieces of equipment designed for airborne applications.

(2) Land platform includes products that relate to fixed or mobile equipment, or pieces of equipment for personnel, weapon systems, vehicles and support elements operating on land.

(3) Naval platform includes products that relate to personnel, equipment or pieces of equipment designed for naval operations.

(4) Space platform includes products that relate to personnel, equipment or pieces of equipment designed for space operations.

(5) All platforms other than Airborne, Land, Naval, or Space.

Customers comprising 10% or more of the Company's revenues for the periods shown are as follows:

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| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| | **September 26, 2025** | **September 27, 2024** |
| Lockheed Martin Corporation | 13% | 11% |
| RTX Corporation | 10% | \* |
| Northrop Grumman | 10% | \* |
| L3Harris | \* | 12% |
|  | 33% | 23% |

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\*&nbsp;&nbsp;&nbsp;&nbsp;Indicates that the amount is less than 10% of the Company's revenue for the respective period.

While the Company typically has customers from which it derives 10% or more of its revenue, the sales to each of these customers are spread across multiple programs and platforms. There were no programs comprising 10% or more of the Company's revenues for the first quarters ended September 26, 2025 and September 27, 2024.

**M.Commitments and Contingencies**

LEGAL CLAIMS

The Company is subject to litigation, claims, investigations and audits arising from time to time in the ordinary course of business. Although legal proceedings are inherently unpredictable, the Company believes that it has valid defenses with respect to those matters currently pending against the Company and intends to defend itself vigorously. The outcome of these matters, individually and in the aggregate, is not expected to have a material impact on the Company's cash flows, results of operations, or financial position.

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On December 7, 2021, counsel for National Technical Systems, Inc. ("NTS") sent the Company an environmental demand letter pursuant to Massachusetts General Laws Chapter 21E, Section 4A, and CERCLA 42 U.S.C. Section 9601, related to a site that NTS formerly owned at 533 Main Street, Acton, Massachusetts. NTS received a Notice of Responsibility from the Massachusetts Department of Environmental Protection ("MassDEP") alleging trichloroethene, Freon and 1,4-dioxane contamination in the groundwater emanating from NTS's former site. NTS alleges that the operations of a predecessor company to Mercury that was acquired in the Company's acquisition of the Microsemi Carve-Out Business that once owned and operated a facility at 531 Main Street, Acton, Massachusetts (the "Site") contributed to the groundwater contamination, and NTS is seeking payment from the Company of NTS's costs for any required environmental remediation. The Company believes the NTS claims are without merit and intends to defend itself vigorously. In November 2021, the Company responded to a request for information from MassDEP regarding the detection of PFAS (per- and polyfluoroakyl substances) in the Acton, Massachusetts Water District's Conant public water supply wells near the Site at a level above the standard that MassDEP published for PFAS in October 2020. The Company has not been contacted by MassDEP regarding PFAS since the response was provided in November 2021. On October 30, 2025, MassDEP sent a Notice of Responsibility to the Company reporting that the Company, as successor to a former owner and operator of the Site, and Laine Realty Trust, the current owner of the Site, are responsible parties related to alleged releases of waste wave solder and Freon at the Site. The Company is engaging a licensed site professional and will respond to the notice from MassDEP. It is too early to determine what responsibility, if any, the Company may have for these environmental matters.

On June 19, 2023, the Board of Directors received notice of the Company's former CEO's resignation from his positions of President and Chief Executive Officer. The Board accepted his resignation effective June 24, 2023. In his notice, the former CEO claimed he was entitled to certain benefits, including equity vesting, severance, and other benefits, under his change in control severance agreement (the "CIC Agreement") because the former CEO had resigned with good reason during a potential change in control period. The Company disputes these claims and maintains that the former CEO resigned without good reason. On September 19, 2023, the former CEO filed for binding arbitration under the employment rules of the American Arbitration Association ("AAA"). An arbitrator was appointed on November 29, 2023. On March 25, 2024, the arbitrator denied the former CEO's motion for compensation during the dispute and payment of his legal fees, preserving those matters for the arbitration hearing. An arbitration hearing was conducted from March 31, 2025 through April 9, 2025. Following the arbitration hearing, the parties filed post-hearing briefs on May 16, 2025, response briefs on June 13, 2025 and conducted oral arguments on June 30, 2025. On August 13, 2025, the arbitrator issued an interim award finding that the former CEO did not have good reason for termination under the CIC Agreement, rejecting the former CEO's claims for enhanced severance payments and accelerated stock vesting. However, the arbitrator found that the former CEO is entitled to compensation during the dispute under the agreement. The arbitrator awarded the former CEO cash compensation including base salary, interest, and bonus, but the arbitrator declined to award the former CEO shares of Mercury stock (or the value thereof) because the arbitrator determined it was unclear whether he had jurisdiction to review the effect of Mercury's Human Capital and Compensation Committee decision to rescind and cancel such stock awards. The arbitrator also awarded the former CEO all reasonable legal fees and expenses incurred in the arbitration per the CIC Agreement, finding no bad faith in his pursuit of the claims, and rejected the Company's counterclaims. The total amount of the Company's obligation to the former CEO is still to be determined, as the calculation of his legal fees and interest remains to be considered by the arbitrator, but the Company expects the total final award to be approximately $3,000. On September 12, 2025, the former CEO filed a complaint in Massachusetts state court seeking to vacate the interim arbitration award in part, as to the shares of Mercury's stock the arbitrator declined to award. The Company believes that it has valid defenses to the claims asserted by the former CEO and intends to contest the claims vigorously. It is reasonably possible that the Company will incur a liability in this matter, and it estimates the potential range of exposure from $3,000 to $12,000, plus costs and attorneys' fees for our former CEO during the Massachusetts state court dispute and further arbitration.

On December 13, 2023, a securities class action complaint was filed against the Company, Mark Aslett, and Michael Ruppert in the U.S. District Court for the District of Massachusetts. The complaint asserted Section 10(b) and 20(a) securities fraud claims on behalf of a purported class of purchasers and sellers of the Company's stock from December 7, 2020, through June 23, 2023. The complaint alleged that the Company's public disclosures in SEC filings and on earnings calls were false and/or misleading. On February 27, 2024, the Court entered an order appointing Carpenters Pension Trust Fund for Northern California as lead plaintiff. On April 18, 2024, the lead plaintiff filed an amended complaint including William Ballhaus and David Farnsworth as additional defendants and amended the class period to February 3, 2021 through February 6, 2024. The Company filed a motion to dismiss on May 24, 2024, and after the plaintiffs' filed their opposition motion and the Company filed its reply to their opposition, a hearing on the motion was conducted by the Court on July 24, 2024. On July 24, 2024, the Court dismissed the case without prejudice and permitted the plaintiffs 30 days to file an amended complaint. The plaintiffs filed for leave to amend their complaint on August 23, 2024, the Company filed its opposition motion on September 6th, the plaintiffs filed their response brief on September 17, 2024, and the Company filed its reply on September 30, 2024. On February 20, 2025, the Court issued an order that dismissed claims relating to 14 of 17 challenged statements and that allowed the remaining three challenged statements to proceed. The Court also dismissed Messrs. Ruppert and Farnsworth from the lawsuit. Subject to the terms of the Company's by-laws and applicable Massachusetts law, Mr. Aslett and Mr. Ballhaus are

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indemnified by the Company for the federal securities class action. While in discovery, the parties participated in a mediation on September 11, 2025. After the mediation, all parties to the securities class action lawsuit agreed to a settlement in principle to resolve the litigation for $32,500, which settlement in principle is subject to a final settlement agreement and review and approval by the court. As of September 26, 2025, a $32,500 receivable and payable were included within prepaid expenses and other current assets and accrued expenses in the Company's Consolidated Balance Sheet, respectively. The increase and decrease in the receivable and payable were reflected within the changes in operating assets and liabilities within the Company's Consolidated Statement of Cash Flows for the first quarter ended September 26, 2025.

On October 11, 2024, the Company received a shareholder derivative demand on behalf of Robert Sawyer alleging substantially the same claims as those covered in the federal securities class action. On November 14, 2024, the Company entered into a tolling agreement on this derivative demand. On February 28, 2025, the Company received a derivative demand on behalf of James Jones alleging substantially the same claims as those covered in the federal securities class action and the Robert Sawyer derivative demand. On May 20, 2025, the Board of Directors formed a Special Investigation Committee of independent directors to investigate the subject matters of the demand letters. On June 6, 2025, James Jones, on behalf of nominal defendant Mercury Systems, Inc., filed a derivative complaint in Massachusetts Superior Court in Essex County against Mark Aslett, Michael Ruppert, William Ballhaus, David Farnsworth, Orlando Carvalho, Lisa Disbrow, Barry Nearhos, Howard Lance, Debora Plunkett, Gerard DeMuro, Scott Ostfeld, Roger Krone, William O'Brien, Vincent Vitto, James Bass, Michael Daniels, and Mary Louise Krakauer, all current or former Mercury officers or directors. This derivative action has been stayed while the Special Investigation Committee conducts its investigation. On July 17, 2025, the Company received a derivative demand on behalf of Pauline McKinnon alleging substantially the same claims as those covered in the federal securities class action and the James Jones and Robert Sawyer derivative demands. The Company believes the claims in the derivative demands and derivative action are without merit and intends to defend itself vigorously. It is too early to determine what responsibility, if any, the Company will have for this matter.

On January 31, 2024, a former employee at the Company's Torrance, California location, filed a wage and hour class action lawsuit in California state court in Los Angeles County, along with a companion Private Attorneys General Act ("PAGA") lawsuit, to act in a representative capacity for other Mercury Mission Systems, LLC employees in California, alleging a range of violations of California wage and hour regulations. On October 1, 2024, a second former employee at our Torrance location filed a PAGA notice to act in a representative capacity on allegations of a range of violations of California wage and hour regulations. On December 21, 2024, the Company reached an agreement in principle to settle these wage and hour class action claims for $450, which settlement in principle is subject to a final settlement agreement and review and approval by the court.

In September 2025, an internal investigation was initiated, with the assistance of outside counsel, in connection with what the Company preliminarily believes may be inaccurately reported test results and certifications of conformance with certain product performance specifications under subcontracts involving approximately $15,000 in total revenue over approximately 20 years in support of a government program. The Company has no evidence that the product has not been effective in its intended use or function, nor has it encountered reported safety issues. The Company has reported the matter to the customer and, in an abundance of caution, to the government. The Company cannot currently estimate the amount or range of cost or any loss associated with this matter. Any determination that the Company's operations were not in compliance with laws or regulations such as the False Claims Act could result in the imposition of civil or criminal fines, penalties, disgorgement, restitution, equitable relief, or other losses or conduct restrictions, and could be material to the Company's financial results or business operations.

INDEMNIFICATION OBLIGATIONS

The Company's standard product sales and license agreements entered into in the ordinary course of business typically contain an indemnification provision pursuant to which the Company indemnifies, holds harmless, and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party in connection with any patent, copyright or other intellectual property infringement claim by any third party with respect to the Company's products. Such provisions generally survive termination or expiration of the agreements. The potential amount of future payments the Company could be required to make under these indemnification provisions is, in some instances, unlimited.

PURCHASE COMMITMENTS

As of September 26, 2025, the Company has entered into non-cancelable purchase commitments for certain inventory components and services used in its normal operations. The purchase commitments covered by these agreements aggregate to $209,466.

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OTHER

As part of the Company's strategy for growth, the Company continues to explore acquisitions or strategic alliances. The associated acquisition costs incurred in the form of professional fees and services may be material to the future periods in which they occur, regardless of whether the acquisition is ultimately completed.

The Company may elect from time to time to purchase and subsequently retire shares of common stock in order to settle employees' tax liabilities associated with vesting of a restricted stock award or exercise of stock options. These transactions would be treated as a use of cash in financing activities in the Company's Consolidated Statements of Cash Flows.

**N.Derivatives**

The Company utilizes interest rate derivatives to mitigate interest rate exposure with respect to its financing arrangements. As of the reporting date, the Company entered into interest rate swaps with a total notional amount of $300,000 to fix the interest rate associated with a portion of the $591,500 existing borrowings on Company's Revolver. The Swap agreement is designated and qualified for hedge accounting treatment as a cash flow hedge and is scheduled to mature on February 28, 2027, coterminous with the maturity of the Revolver. As of September 26, 2025, the fair value of the Swap was a liability of $4,778 and is included within Other non-current liabilities in the Company's Consolidated Balance Sheet.

On September 29, 2022 and on September 28, 2023 the Company terminated previous Swap agreements and entered into new agreements with the same maturity February 28, 2027. The fair market values of the Swaps at the time of termination are amortized until the maturity date (February 28, 2027).

During the first quarter ended September 26, 2025, the Company amortized a total of $881 of the gain associated with the previously disclosed interest swaps terminated on September 29, 2022 and September 28, 2023, as disclosed in Note Q of Form 10-K filed with the SEC on August 11, 2025, which is included within Other comprehensive income (loss).

The market risk associated with the Company's derivative instrument is the result of interest rate movements that are expected to offset the market risk of the underlying arrangement. The counterparty to the September 2023 Swap is JPMorgan. Based on the credit ratings of the Company's counterparty as of September 26, 2025, nonperformance is not perceived to be a material risk. Furthermore, none of the Company's derivatives are subject to collateral or other security arrangements and none contain provisions that are dependent on the Company's credit ratings from any credit rating agency. While the contract or notional amounts of derivative financial instruments provide one measure of the volume of these transactions, they do not represent the amount of the Company's exposure to credit risk. The amounts potentially subject to credit risk (arising from the possible inability of the counterparty to meet the terms of their contracts) are generally limited to the amounts, if any, by which the counterparty obligations under the contracts exceed the obligations of the Company to the counterparty. As a result of the above considerations, the Company does not consider the risk of counterparty default to be significant.

**O.Subsequent Events**

The Company has evaluated subsequent events from the date of the Consolidated Balance Sheet through the date the consolidated financial statements were issued.

On October 22, 2025, at the Company's Annual Meeting, shareholders approved the Company's new 2025 Long Term Incentive Plan, which replaces the Company's 2018 Stock Incentive Plan.

On November 3, 2025, the Board of Directors authorized a new share repurchase program for the purchase of up to $200,000 of the Company's outstanding common stock. The program has no expiration date and repurchases may be made through open market or privately negotiated transactions from time to time at prevailing market prices. The timing and amount of repurchases will depend on market conditions and other factors.

On November 4, 2025, the Company entered into Amendment No. 7 to the Revolver. This amendment extends the maturity date of the Revolver by five years to November 4, 2030 with a facility size of $850,000. As of the effective date of the amendment, the outstanding balance on the Revolver was $591,500.

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**ITEM 2. &nbsp;&nbsp;&nbsp;&nbsp;MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

**FORWARD-LOOKING STATEMENTS**

From time to time, information provided, statements made by our employees or information included in our filings with the Securities and Exchange Commission ("SEC") may contain statements that are not historical facts but that are "forward-looking statements," which involve risks and uncertainties. You can identify these statements by the words "may," "will," "could," "should," "would," "plans," "expects," "anticipates," "continue," "estimate," "project," "intend," "likely," "forecast," "probable," "potential," and similar expressions. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected or anticipated. Such risks and uncertainties include, but are not limited to, continued funding of defense programs, the timing and amounts of such funding, general economic and business conditions, including unforeseen weakness in our markets, effects of any U.S. federal government shutdown or extended continuing resolution, effects of geopolitical unrest and regional conflicts, competition, changes in technology and methods of marketing, delays in or cost increases related to completing development, engineering and manufacturing programs, changes in customer order patterns, changes in product mix, continued success in technological advances and delivering technological innovations, changes in, or in the U.S. government's interpretation of, federal export control or procurement rules and regulations, including tariffs, changes in, or in the interpretation or enforcement of, environmental rules and regulations, market acceptance of our products, shortages in or delays in receiving components, supply chain delays or volatility for critical components, production delays or unanticipated expenses including due to quality issues or manufacturing execution issues, failure to meet contractual performance specifications, adherence to required manufacturing standards, capacity underutilization, increases in scrap or inventory write-offs, failure to achieve or maintain manufacturing quality certifications, such as AS9100, failure to achieve or maintain qualified business systems, such as those required by the DFARS, adverse findings in government audits or investigations, the impact of supply chain disruption, inflation and labor shortages, among other things, on program execution and the resulting effect on customer satisfaction, inability to fully realize the expected benefits from acquisitions, restructurings, and operational efficiency initiatives or delays in realizing such benefits, challenges in integrating acquired businesses and achieving anticipated synergies, effects of shareholder activism, increases in interest rates, changes to industrial security and cyber-security regulations and requirements and impacts from any cyber or insider threat events, changes in tax rates or tax regulations, changes to interest rate swaps or other cash flow hedging arrangements, changes to generally accepted accounting principles, difficulties in retaining key employees and customers, litigation, including the dispute arising with the former CEO over his resignation, unanticipated costs under fixed-price service and system integration engagements, and various other factors beyond our control. These risks and uncertainties also include such additional risk factors as are discussed in our filings with the U.S. Securities and Exchange Commission, including our Annual Report on Form 10-K for the fiscal year ended June 27, 2025. We caution readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. We undertake no obligation to update any forward looking statement to reflect events or circumstances after the date on which such statement is made.

**OVERVIEW**

Mercury Systems is a global technology company that delivers mission-critical processing to the edge to solve the most pressing aerospace and defense challenges.

Combining technologies and expertise developed for more than 40 years, the Mercury Processing Platform offers customers a unique advantage to unleash breakthrough capabilities. It spans the full breadth of signal processing—from RF front end to the human-machine interface—to rapidly convert meaningful data, gathered in the most remote and hostile environments, into critical decisions. The Processing Platform allows Mercury to offer standard products and custom integrated solutions from silicon to system scale, including components, modules, subsystems, and systems.

Mercury's products and integrated solutions are deployed in more than 300 programs and across 35 countries. The company is headquartered in Andover, Massachusetts, and has more than 20 locations worldwide.

As a leading manufacturer of essential components, products, modules and subsystems, we sell to the top U.S. and European defense prime contractors, the U.S. government and original equipment manufacturers ("OEM") commercial aerospace companies. Our mission-critical products and solutions are deployed by our customers for a variety of applications including sensor and radar processing, electronic warfare, avionics, weapons, and command, control, communications, and intelligence ("C4I"). Mercury has built a trusted, robust portfolio of proven capabilities, leveraging the most advanced commercial silicon technologies and purpose-built to exceed the performance needs of our defense and commercial customers. Customers add their own applications and algorithms to our specialized, secure and innovative products and pre-integrated solutions. This allows them to complete their full system by integrating with their platform, the sensor technology and, increasingly, the processing from Mercury.

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Our deep, long-standing relationships with leading high-tech and other commercial companies, coupled with our targeted research and development ("R&D") investments and industry-leading trusted and secure design and manufacturing capabilities, are the foundational tenets of this highly successful model. We are leading the development and adaptation of commercial technology for aerospace and defense solutions. From chip-scale to system scale and from data, including RF to digital to decision, we make mission-critical technologies safe, secure, affordable and relevant for our customers.

Our capabilities, technology, people and R&D investment strategy combine to differentiate Mercury in our industry. We maintain our technological edge by investing in critical capabilities and intellectual property ("IP" or "building blocks") in processing, leveraging open standards and open architectures to adapt quickly those building blocks into solutions for highly data-intensive applications, including emerging needs in areas such as artificial intelligence ("AI").

As of September 26, 2025, we had 2,175 employees. We employ hardware and software architects and design engineers, primarily engaged in engineering and research and product development activities to achieve our objectives to fully capitalize upon and maintain our technological leads in the high-performance, real-time sensor processing industry and in mission computing, platform management and other safety-critical applications. Our talent attraction, engagement and retention is critical to execute on our long-term strategy. We invest in our culture and values to drive employee engagement that turns ideas into action, delivering trusted and secure solutions at the speed of innovation. We believe that our success depends on our ability to foster a company-wide culture that values a broad range of solutions to problems, a wide array of skills and experiences, and multiple perspectives. We are committed to providing an inclusive environment that respects the varied backgrounds and viewpoints of our employees. We believe that the workforce required to grow our business and deliver creative solutions must be rich in diverse thought and experience. Our initiatives focus on building and maintaining the talent that will create cohesive and collaborative teams that drive innovation. By adhering to these values, it will help our employees to realize their full potential at work to provide Innovation That Matters®.

Our consolidated revenues, net loss, diluted net loss per share, adjusted earnings per share ("adjusted EPS"), and adjusted EBITDA for the first quarter ended September 26, 2025 were $225.2 million, $12.5 million, $0.21, $0.26, and $35.6 million, respectively.

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**RESULTS OF OPERATIONS:**

There were 13 weeks included in the results of operations for the first quarters ended September 26, 2025 and September 27, 2024, respectively. The results for the first quarter ended September 26, 2025 are not necessarily indicative of the results to be expected for the full fiscal year.

**The first quarter ended September 26, 2025 compared to the first quarter ended September 27, 2024** 

The following table sets forth, for the first quarter ended indicated, financial data from the Consolidated Statements of Operations and Comprehensive Loss:

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| | | | | |
|:---|:---|:---|:---|:---|
| **<u>(In thousands)</u>** | **September 26, 2025** | **As a % of<br>Total Net<br>Revenue** | **September 27, 2024** | **As a % of<br>Total Net<br>Revenue** |
| Net revenues | $225209 | 100.0% | $204431 | 100.0% |
| Cost of revenues | 162310 | 72.1 | 152641 | 74.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross margin | 62899 | 27.9 | 51790 | 25.3 |
| Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Selling, general and administrative | 45906 | 20.3 | 33153 | 16.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Research and development | 13184 | 5.9 | 18383 | 9.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of intangible assets | 10259 | 4.6 | 11235 | 5.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restructuring and other charges | 1584 | 0.7 | 2260 | 1.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Acquisition costs and other related expenses | 563 | 0.2 | 177 | 0.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 71496 | 31.7 | 65208 | 31.9 |
| Loss from operations | (8597) | (3.8) | (13418) | (6.6) |
| Interest income | 2027 | 0.9 | 544 | 0.3 |
| Interest expense | (7886) | (3.5) | (8906) | (4.4) |
| Other expense, net | (2080) | (1.0) | (1339) | (0.6) |
| Loss before income tax benefit | (16536) | (7.4) | (23119) | (11.3) |
| Income tax benefit | (4021) | (1.8) | (5594) | (2.7) |
| Net Loss | $(12515) | (5.6)% | $(17525) | (8.6)% |

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REVENUES

Total revenues increased $20.8 million, or 10.2%, to $225.2 million during the first quarter ended September 26, 2025, as compared to $204.4 million during the first quarter ended September 27, 2024. Revenues increased year over year as we continued to execute on our program base, and continued toward full rate production of our common processing architecture programs. Point in time revenue and over time revenue represented 52% and 48%, respectively, of total revenues during the first quarter ended September 26, 2025, an increase of $25.2 million and decrease of $4.5 million, respectively. Point in time revenue and over time revenue represented 45% and 55% respectively, of total revenues during the first quarter ended September 27, 2024.

Revenue increases were driven by the modules and sub-assemblies as well as the components product grouping which increased $20.4 million and $0.6 million, respectively, partially offset by the integrated solutions product grouping which decreased $0.2 million during the first quarter ended September 26, 2025 when compared to the prior period. The increase in total revenue was primarily driven by the C4I and other sensor and effector end applications with increases of $26.2 million and $3.4 million respectively, partially offset by decreases to the electronic warfare and the radar end applications of $5.3 million and $3.6 million. The increase in total revenue was also driven by the Land, Other, Airborne, and Space platforms with increases of $8.6 million, $5.9 million, $4.2 million, and $3.1 million, respectively, partially offset by a decrease to the Naval platform of $1.0 million. The largest program increases were related to KC-46, a secure processing program, and F/A-18, partially offset by decreases in a secure processing program and the F-16 program when compared to the prior period. There were no programs comprising 10% or more of our revenues for the first quarters ended September 26, 2025 or September 27, 2024.

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GROSS MARGIN

Gross margin was 27.9% for the first quarter ended September 26, 2025, an increase of 260 basis points from the 25.3% gross margin realized during the first quarter ended September 27, 2024. The higher gross margin was driven primarily by favorable program mix, lower manufacturing adjustments of $7.4 million as well as net estimate at completion ("EAC") change impact on our programs recognized over time of approximately $4.1 million recorded in the quarter, an incremental improvement of approximately $4.2 million, or 200 basis points, when compared to the prior period. We may experience increases in our manufacturing costs related to the imposition of tariffs on the import of components from other countries. We have not seen material increases to these costs in the first quarter of fiscal 2026, but they could impact our gross margins in the future.

We had the following aggregate effects of favorable and unfavorable margin impacts as a result of changes in estimates across our portfolio for the period presented:

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| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| *(in thousands)* | **September 26, 2025** | **September 27, 2024** |
| Gross favorable | $8455 | $7774 |
| Gross unfavorable | (12505) | (16067) |
| Net impact of changes in estimates | $(4050) | $(8293) |

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The changes in estimates are assessed based on historical results and cumulative adjustments are recorded to recognize revenue to date based on changes in estimated margin on programs, including impact of contract amendments factored for potential risks and opportunities. We utilize the latest and best information available when revising our estimates and apply consistent judgment across the full portfolio of programs.

SELLING, GENERAL AND ADMINISTRATIVE

Selling, general and administrative expenses increased $12.7 million, or 38.4%, to $45.9 million during the first quarter ended September 26, 2025, as compared to $33.2 million in the first quarter ended September 27, 2024. The increase was primarily driven by higher compensation and litigation and settlement expense of $7.3 million and $6.0 million, respectively. These increases were partially offset by lower consulting and depreciation expense of $0.6 million and $0.5 million, respectively. The litigation and settlement expense incurred during the first quarter ended September 26, 2025 was comprised of $5.2 million related to the dispute with our former CEO and $1.0 million related to contract matters.

RESEARCH AND DEVELOPMENT

Research and development expenses decreased $5.2 million, or 28.3%, to $13.2 million during the first quarter ended September 26, 2025, as compared to $18.4 million during the first quarter ended September 27, 2024. The decrease was primarily driven by the savings from headcount reductions of approximately 230 employees, initiated in fiscal 2025, resulting in lower expense of $6.7 million. We also saw decreased spending on outside service, depreciation, and software licensing expense of $0.6 million, $0.6 million, and $0.4 million, respectively. These decreases were partially offset by higher equipment and supplies and bonus expense of $2.2 million and $1.1 million, respectively.

AMORTIZATION OF INTANGIBLE ASSETS

We recognized $10.3 million of amortization of intangible assets during the first quarter ended September 26, 2025, as compared to $11.2 million during the first quarter ended September 27, 2024, primarily due to various customer relationship intangibles being fully amortized in fiscal 2025.

RESTRUCTURING AND OTHER CHARGES

We incurred $1.6 million of restructuring and other charges during the first quarter ended September 26, 2025, as compared to $2.3 million during the first quarter ended September 27, 2024. Restructuring and other charges during the first quarter ended September 26, 2025 were primarily to related to severance related charges associated with a workforce reduction initiated during the quarter that eliminated approximately 40 positions. Restructuring and other charges during the first quarter ended September 27, 2024 were primarily for severance related charges.

We expect to incur an additional $2.4 million of restructuring and other charges during the second quarter ending December 26, 2025, primarily related to severance-related charges associated with a workforce reduction that eliminates 42 international positions.

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ACQUISITION COSTS AND OTHER RELATED EXPENSES

Acquisition costs and other related expenses were $0.6 million during the first quarter ended September 26, 2025, as compared to $0.2 million during the first quarter ended September 27, 2024.

We could incur acquisition costs and other related expenses periodically in the future as we continue to seek acquisition opportunities to expand our technological capabilities and especially within the sensor and effector and C4I markets. Transaction costs incurred by the acquiree prior to the consummation of an acquisition would not be reflected in our historical results of operations.

INTEREST INCOME

We recognized $2.0 million of interest income during the first quarter ended September 26, 2025, as compared to $0.5 million during the first quarter ended September 27, 2024. The increase was driven by higher average cash and cash equivalents during the period.

INTEREST EXPENSE

We incurred $7.9 million of interest expense during the first quarter ended September 26, 2025, as compared to $8.9 million during the first quarter ended September 27, 2024. The decrease was driven by lower interest rates during the period on our existing credit facility (the "Revolver").

OTHER EXPENSE, NET

Other expense, net was $2.1 million during the first quarter ended September 26, 2025, as compared to $1.3 million during the first quarter ended September 27, 2024. The first quarter ended September 26, 2025 includes $0.9 million of financing costs, $0.8 million net foreign currency translation losses, and $0.4 million of securities class action expense. Legal fees incurred under the securities class action are reimbursable by our insurance providers, mitigating our expenses incurred to date. The first quarter ended September 27, 2024 includes $2.3 million of financing costs, $0.5 million of consulting costs, and $0.2 million securities class action expenses, partially offset by $1.5 million net foreign currency translation gains and $0.2 million of other income.

INCOME TAXES

We recorded income tax benefits of $4.0 million and $5.6 million on losses before income taxes of $16.5 million and $23.1 million for the first quarters ended September 26, 2025 and September 27, 2024, respectively.

During the first quarter ended September 26, 2025 and September 27, 2024, we recognized a tax benefit of $1.1 million related to stock compensation windfalls and a tax provision of $0.2 million related to stock compensation shortfalls, respectively.

The effective tax rate for the first quarter ended September 26, 2025 and September 27, 2024 differed from the federal statutory rate primarily due to federal and state research and development credits, non-deductible compensation, and state taxes.

We continue to maintain a valuation allowance on all of our foreign net operating loss carryforwards and the majority of our state research and developmental tax credit carryforwards. Based on forecasted taxable income and the scheduled reversal of the remaining deferred tax assets, we believe it is more likely than not that all other deferred tax assets will be recognized. We expect to amortize previously capitalized research and development expenditures.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted, which includes a broad range of tax provisions and extended and modified certain provisions of the Tax Cuts and Jobs Act ("TCJA"), including, but not limited to, restoration of 100% bonus depreciation, EBITDA-based interest expense limitation and immediate expensing of domestic research and development expenditures. We have evaluated the potential impact of this legislation and expect it to result primarily in a timing difference, with no material impact on our effective tax rate.

**LIQUIDITY AND CAPITAL RESOURCES**

Our primary sources of liquidity come from existing cash and cash generated from operations, our Revolver, and our ability to raise capital under our universal shelf registration statement. Our near-term fixed commitments for cash expenditures consist primarily of payments under operating leases and inventory purchase commitments. As of the first quarter ended September 26, 2025, our working capital balance increased $9.0 million as compared to the balance as of June 27, 2025.

Based on our current plans and business conditions, we believe that existing cash and cash equivalents, our available Revolver, cash generated from operations and our financing capabilities will be sufficient to satisfy our anticipated cash requirements for at least the next twelve months.

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***Shelf Registration Statement***

On October 4, 2023, we filed a shelf registration statement on Form S-3ASR with the SEC. The shelf registration statement, which was effective upon filing with the SEC, registered each of the following securities: debt securities, preferred stock, common stock, warrants and units. We intend to use the proceeds from financings using the shelf registration statement for general corporate purposes, which may include the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the acquisition of other companies or businesses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the repayment and refinancing of debt;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• capital expenditures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• working capital; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other purposes as described in the prospectus supplement.

We have an unlimited amount available under the shelf registration statement.

***Revolving Credit Facilities***

We have a 5-year Revolver with a maturity extended to February 28, 2027. The borrowing capacity as defined under the Revolver as of September 26, 2025 is the total availability of $900.0 million less outstanding borrowings of $591.5 million and outstanding letters of credit of $5.9 million. During the first quarter ended September 26, 2025, we made no borrowings or repayments. As of September 26, 2025, we were in compliance with all covenants and conditions under the Revolver.

On August 13, 2024, we executed Amendment No. 6 to the Revolver, decreasing the permanent borrowing capacity to $900.0 million.

On November 4, 2025, the Company entered into Amendment No. 7 to the Revolver. This amendment extends the maturity date of the credit facility by five years to November 4, 2030 with a facility size of $850.0 million. As of the effective date of the amendment, the outstanding balance on the facility was $591.5 million.

See Note I in the accompanying consolidated financial statements for further discussion of the Revolver.

***Receivables Purchase Agreement***

On August 13, 2024, we entered into a $60.0 million committed receivables purchase and servicing agreement ("RPSA") with a new party. The RPSA has an initial term of two years. Pursuant to the RPSA, the new party has committed to purchase receivables at a discount from a list of certain of our customers, maintaining a balance of purchased receivables at or below $60.0 million. We had $45.5 million of factored accounts receivable as of September 26, 2025 and incurred factoring fees of approximately $0.4 million during the first quarter ended September 26, 2025. We had $43.7 million of factored accounts receivable as of September 27, 2024 and incurred factoring fees of approximately $0.4 million during the first quarter ended September 27, 2024.

**CASH FLOWS**

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| | | |
|:---|:---|:---|
| | **As of and For the First Quarters Ended,** | **As of and For the First Quarters Ended,** |
| **<u>(In thousands)</u>** | **September 26, 2025** | **September 27, 2024** |
| Net cash provided by (used in) operating activities | $2182 | $(14660) |
| Net cash used in investing activities | $(6548) | $(6236) |
| Net cash used in financing activities | $— | $(2249) |
| Net decrease in cash and cash equivalents | $(4383) | $(22398) |
| Cash and cash equivalents at end of period | $304716 | $158123 |

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Our cash and cash equivalents decreased by $4.4 million from June 27, 2025 to September 26, 2025, as the result of $6.5 million invested in purchases of property and equipment, partially offset by $2.2 million of cash provided by operating activities.

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*Operating Activities*

During the first quarter ended September 26, 2025, we had an inflow of $2.2 million in cash from operating activities compared to a $14.7 million outflow during the first quarter ended September 27, 2024. The inflow during the first quarter ended September 26, 2025 was primarily due to an inflow of $20.9 million from accounts payable, accrued expenses, and accrued compensation, as compared to an outflow in the prior period of $27.0 million, an inflow of $20.1 million from accounts receivable, unbilled receivables, and costs in excess of billings, as compared to an outflow in the prior period of $6.1 million, a lower net loss of $5.0 million, and a lower benefit for deferred income taxes of $4.0 million. This activity was partially offset by an outflow of $35.3 million from prepaid expenses and other current assets, as compared to an inflow in the prior period of $2.0 million and an outflow of $8.3 million from deferred revenues and customer advances, as compared to an inflow in the prior period of $21.2 million. The settlement in principle of the federal securities class action lawsuit, which is expected to be covered by our insurance, reached during the first quarter ended September 26, 20025, increased the cash provided by accrued expenses and was offset by a $32.5 million outflow in other current assets, respectively.

*Investing Activities*

During the first quarter ended September 26, 2025, we had higher purchases of property and equipment of $6.5 million, an increase of $0.3 million, as compared to $6.2 million during the first quarter ended September 27, 2024.

*Financing Activities*

During the first quarter ended September 26, 2025, we had no financing cash flows, as compared to $2.2 million of cash paid in deferred financing in conjunction with the amendment to our Revolver during the first quarter of fiscal 2025.

**COMMITMENTS, CONTRACTUAL OBLIGATIONS AND CONTINGENCIES**

The following is a schedule of our commitments and contractual obligations outstanding at September 26, 2025:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **<u>(In thousands)</u>** | **Total** | **Less Than<br>1 Year** | **1-3<br>Years** | **3-5<br>Years** | **More Than<br>5 Years** |
| Purchase obligations | $209466 | $184429 | $18778 | $6259 | $— |
| Operating leases | 75889 | 14854 | 28670 | 21466 | 10899 |
|  | $285355 | $199283 | $47448 | $27725 | $10899 |

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Purchase obligations represent open non-cancelable purchase commitments for certain inventory components and services used in normal operations. The purchase commitments covered by these agreements aggregated approximately $209.5 million at September 26, 2025.

We have a liability at September 26, 2025 of $4.0 million for uncertain tax positions that have been taken or are expected to be taken in various income tax returns. We do not know the ultimate resolution on these uncertain tax positions and as such, do not know the ultimate timing of payments or amount, if any, related to this liability. Accordingly, these amounts are not included in the above table.

Our standard product sales and license agreements entered into in the ordinary course of business typically contain an indemnification provision pursuant to which we indemnify, hold harmless and agree to reimburse the indemnified party for losses suffered or incurred in connection with certain intellectual property infringement claims by any third party with respect to our products. Such provisions generally survive termination or expiration of the agreements. The potential amount of future payments we could be required to make under these indemnification provisions is, in some instances, unlimited.

As part of our strategy for growth, we continue to explore acquisitions or strategic alliances. The associated acquisition costs incurred in the form of professional fees and services may be material to the future periods in which they occur, regardless of whether the acquisition is ultimately completed.

We may elect from time to time to purchase and subsequently retire shares of common stock in order to settle employees' tax liabilities associated with vesting of a restricted stock award. These transactions would be treated as a use of cash in financing activities in our Consolidated Statements of Cash Flows.

On November 3, 2025, the Board of Directors authorized a new share repurchase program for the purchase of up to $200.0 million of our outstanding common stock. The program has no expiration date and repurchases may be made through open market or privately negotiated transactions from time to time at prevailing market prices. The timing and amount of repurchases will depend on market conditions and other factors.

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**OFF-BALANCE SHEET ARRANGEMENTS**

Other than certain indemnification provisions in the normal course of business, we do not have any off-balance sheet financing arrangements or liabilities, guarantee contracts, retained or contingent interests in transferred assets, or any obligation arising out of a material variable interest in an unconsolidated entity. We do not have any majority-owned subsidiaries that are not consolidated in the financial statements. Additionally, we do not have an interest in, or relationships with, any special purpose entities.

**NON-GAAP FINANCIAL MEASURES**

In our periodic communications, we discuss certain important measures that are not calculated according to U.S. generally accepted accounting principles ("GAAP"), including adjusted EBITDA, adjusted income, adjusted EPS, and free cash flow.

Adjusted EBITDA is defined as net income before other non-operating adjustments, interest income and expense, income taxes, depreciation, amortization of intangible assets, restructuring and other charges, impairment of long-lived assets, acquisition, financing and other third party costs, fair value adjustments from purchase accounting, litigation and settlement income and expense, COVID related expenses, and stock-based and other non-cash compensation expense. We use adjusted EBITDA as an important indicator of the operating performance of our business. We use adjusted EBITDA in internal forecasts and models when establishing internal operating budgets, supplementing the financial results and forecasts reported to our board of directors, determining the portion of bonus compensation for executive officers and other key employees based on operating performance, evaluating short-term and long-term operating trends in our operations and allocating resources to various initiatives and operational requirements. We believe that adjusted EBITDA permits a comparative assessment of our operating performance, relative to our performance based on our GAAP results, while isolating the effects of charges that may vary from period to period without any correlation to underlying operating performance. We believe that these non-GAAP financial adjustments are useful to investors because they allow investors to evaluate the effectiveness of the methodology and information used by management in our financial and operational decision-making. We believe that trends in our adjusted EBITDA are valuable indicators of our operating performance.

Adjusted EBITDA is a non-GAAP financial measure and should not be considered in isolation or as a substitute for financial information provided in accordance with GAAP. This non-GAAP financial measure may not be computed in the same manner as similarly titled measures used by other companies. We expect to continue to incur expenses similar to the adjusted EBITDA financial adjustments described above, and investors should not infer from our presentation of this non-GAAP financial measure that these costs are unusual, infrequent or non-recurring.

The following table reconciles our net loss, the most directly comparable GAAP financial measure, to our adjusted EBITDA:

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| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| **<u>(In thousands)</u>** | **September 26, 2025** | **September 27, 2024** |
| Net loss | $(12515) | $(17525) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-operating adjustments, net | 748 | (1735) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expense, net | 5859 | 8362 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income tax benefit | (4021) | (5594) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation | 8654 | 9985 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of intangible assets | 10259 | 11235 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restructuring and other charges | 1584 | 2260 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment of long-lived asset |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Acquisition, financing and other third party costs | 1317 | 2331 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair value adjustments from purchase accounting | 131 | 177 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Litigation and settlement expense, net | 7224 | 1394 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based and other non-cash compensation expense | 16328 | 10560 |
| Adjusted EBITDA | $35568 | $21450 |

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Adjusted income and adjusted EPS exclude the impact of certain items and, therefore, have not been calculated in accordance with GAAP. We believe that exclusion of these items assists in providing a more complete understanding of our underlying results and trends and allows for comparability with our peer company index and industry. These non-GAAP financial measures may not be computed in the same manner as similarly titled measures used by other companies. We use these measures along with the corresponding GAAP financial measures to manage our business and to evaluate our performance compared to prior periods and the marketplace. We define adjusted income as net income before other non-operating adjustments, amortization of intangible assets, restructuring and other charges, impairment of long-lived assets, acquisition, financing and other third party costs, fair value adjustments from purchase accounting, litigation and settlement income and expense, and stock-based and other non-cash compensation expense. The impact to income taxes includes the impact to the effective tax rate, current tax provision and deferred tax provision. Adjusted EPS expresses adjusted income on a per share basis using weighted average diluted shares outstanding.

Adjusted income and adjusted EPS are non-GAAP financial measures and should not be considered in isolation or as a substitute for financial information provided in accordance with GAAP. We expect to continue to incur expenses similar to the adjusted income and adjusted EPS financial adjustments described above, and investors should not infer from our presentation of these non-GAAP financial measures that these costs are unusual, infrequent or non-recurring.

The following tables reconcile net loss and diluted loss per share, the most directly comparable GAAP measures, to adjusted income and adjusted EPS:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** | **First Quarters Ended** | **First Quarters Ended** |  |
| **<u>(In thousands, except per share data)</u>** | **September 26, 2025** | **September 26, 2025** | **September 27, 2024** | **September 27, 2024** |  |
| Net loss and loss per share | $(12515) | $(0.21) | $(17525) | $(0.30) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-operating adjustments, net | 748 |  | (1735) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of intangible assets | 10259 |  | 11235 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restructuring and other charges | 1584 |  | 2260 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment of long-lived assets |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Acquisition, financing and other third party costs | 1317 |  | 2331 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair value adjustments from purchase accounting | 131 |  | 177 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Litigation and settlement expense, net | 7224 |  | 1394 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based and other non-cash compensation expense | 16328 |  | 10560 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impact to income taxes<sup>(1)</sup> | (9516) |  | (6253) |  |  |
| Adjusted income and adjusted earnings per share<sup>(2)</sup> | $15560 | $0.26 | $2444 | $0.04 |  |
| Diluted weighted-average shares outstanding |  | 60140 |  | 58585 |  |
| (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. | (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. | (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. | (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. | (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. |  |
| (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. | (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. | (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. | (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. | (1) Impact to income taxes is calculated by recasting income before income taxes to include the items involved in determining adjusted income and recalculating the income tax provision using this adjusted income from operations before income taxes. The recalculation also adjusts for any discrete tax expense or benefit related to the items. | (2) Adjusted earnings per share is calculated using diluted shares whereas Net loss per share or Adjusted loss per share is calculated using basic shares. There was no impact to the calculation of adjusted earnings per share as a result of this for the first quarters ended September 26, 2025 and September 27, 2024. |
| (2) Adjusted earnings per share is calculated using diluted shares whereas Net loss per share or Adjusted loss per share is calculated using basic shares. There was no impact to the calculation of adjusted earnings per share as a result of this for the first quarters ended September 26, 2025 and September 27, 2024. | (2) Adjusted earnings per share is calculated using diluted shares whereas Net loss per share or Adjusted loss per share is calculated using basic shares. There was no impact to the calculation of adjusted earnings per share as a result of this for the first quarters ended September 26, 2025 and September 27, 2024. | (2) Adjusted earnings per share is calculated using diluted shares whereas Net loss per share or Adjusted loss per share is calculated using basic shares. There was no impact to the calculation of adjusted earnings per share as a result of this for the first quarters ended September 26, 2025 and September 27, 2024. | (2) Adjusted earnings per share is calculated using diluted shares whereas Net loss per share or Adjusted loss per share is calculated using basic shares. There was no impact to the calculation of adjusted earnings per share as a result of this for the first quarters ended September 26, 2025 and September 27, 2024. | (2) Adjusted earnings per share is calculated using diluted shares whereas Net loss per share or Adjusted loss per share is calculated using basic shares. There was no impact to the calculation of adjusted earnings per share as a result of this for the first quarters ended September 26, 2025 and September 27, 2024. |  |

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Free cash flow, a non-GAAP measure for reporting cash flow, is defined as cash provided by operating activities less capital expenditures for property and equipment, which includes capitalized software development costs. We believe free cash flow provides investors with an important perspective on cash available for investments and acquisitions after making capital investments required to support ongoing business operations and long-term value creation. We believe that trends in our free cash flow can be valuable indicators of our operating performance and liquidity.

Free cash flow is a non-GAAP financial measure and should not be considered in isolation or as a substitute for financial information provided in accordance with GAAP. This non-GAAP financial measure may not be computed in the same manner as similarly titled measures used by other companies. We expect to continue to incur expenditures similar to the free cash flow adjustment described above, and investors should not infer from our presentation of this non-GAAP financial measure that these expenditures reflect all of our obligations which require cash.

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The following table reconciles cash used in operating activities, the most directly comparable GAAP financial measure, to free cash flow:

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| | | |
|:---|:---|:---|
| | **First Quarters Ended** | **First Quarters Ended** |
| **<u>(In thousands)</u>** | **September 26, 2025** | **September 27, 2024** |
| Net cash provided by (used in) operating activities | $2182 | $(14660) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of property and equipment | (6548) | (6236) |
| Free cash flow | $(4366) | $(20896) |

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**RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS** 

See Note B to our consolidated financial statements (under the caption "Recently Issued Accounting Pronouncements").

**RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS**

See Note B to our consolidated financial statements (under the caption "Recently Adopted Accounting Pronouncements").

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**ITEM 3. &nbsp;&nbsp;&nbsp;&nbsp;QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

There were no material changes in our exposure to market risk from June 27, 2025 to September 26, 2025.

**ITEM 4. &nbsp;&nbsp;&nbsp;&nbsp;CONTROLS AND PROCEDURES**

***(a) Evaluation of Disclosure Controls and Procedures***

We conducted an evaluation under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer (our principal executive officer and principal financial officer, respectively), regarding the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of September 26, 2025. We continue to review our disclosure controls and procedures and may from time to time make changes aimed at enhancing their effectiveness and to ensure that our systems evolve with our Company's business. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

***(b) Changes in Internal Control Over Financial Reporting***

There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended September 26, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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**PART II. OTHER INFORMATION**

**ITEM 1. &nbsp;&nbsp;&nbsp;&nbsp;LEGAL PROCEEDINGS**

We are subject to litigation, claims, investigations and audits arising from time to time in the ordinary course of our business. Although legal proceedings are inherently unpredictable, we believe that we have valid defenses with respect to those matters currently pending against us and intend to defend ourself vigorously. The outcome of these matters, individually and in the aggregate, is not expected to have a material impact on our cash flows, results of operations, or financial position. Please see Note M to our consolidated financial statements (under the caption "Legal Claims") for a discussion of our legal proceedings.

**ITEM 1A. &nbsp;&nbsp;&nbsp;&nbsp;RISK FACTORS**

The following risk factor supplements the risk factors included in our Annual Report on Form 10-K for the fiscal year ended June 27, 2025.

**We are subject to risks from the continuation of the ongoing U.S. federal government shutdown.**

Our business is exposed to operational and financial disruptions caused by the U.S. federal government shutdown that began on October 1, 2025. The ongoing U.S. federal government shutdown may result in us experiencing delays or decreases in customer orders with the U.S. DoD or with our prime contractor customers or potentially the suspension of work on contacts in progress or in payment delays related to the funding status of different programs. The shutdown has also slowed the processing of export licenses by agencies such as the Department of State's Directorate of Defense Trade Controls and the Department of Commerce's Bureau of Industry and Security. These export license delays could hinder our ability to fulfill international orders and potentially subject us to increased costs for liquidated damages or other penalties for late deliveries. Given the indefinite nature of the current shutdown and the absence of a clear resolution timeline, we anticipate continued volatility in the federal contracting environment. If the shutdown persists for an extended timeframe, it could materially and adversely affect our results of operations and financial performance.

**ITEM 5. &nbsp;&nbsp;&nbsp;&nbsp;OTHER INFORMATION**

**10b5-1 Plans**

During the first quarter ended September 26, 2025, none of the Company's directors or executive officers adopted, modified or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement as each term is defined in Section 408(a) of Regulation S-K.

**Amendment No. 1 to CEO Employment Agreement**

On October 31, 2025, the independent directors on the Board of Directors, upon the recommendation of the Human Capital and Compensation Committee, approved Amendment No. 1 to the Employment Agreement for our Chief Executive Officer. The amendment was approved following a periodic review of the Company's executive severance arrangements performed by the Human Capital and Compensation Committee in consultation with its independent compensation consultant. The amendment provides for a best net benefit limitation provision for purposes of Section 280G of the Internal Revenue Code consistent with the terms of Company's prior and updated forms of Change of Control Severance Agreement for Executive Vice Presidents. Under this provision, any executive payments or benefits to be provided to our CEO upon a qualified termination in connection with a change in control ("CIC") would be reduced to the extent necessary to avoid imposition of a CIC excise tax if doing so would maximize our CEO's net after-tax income. The CEO's employment agreement is otherwise unchanged by the amendment.

The foregoing description of the Amendment No. 1 to the Employment Agreement for the CEO does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment No. 1, which is filed as Exhibit 10.2 to this Quarterly Report on Form 10-Q and is incorporated by reference into this Item 5.

**Form of Change in Control Agreement and Severance Benefits Agreement for Non-CEO Executives**

On October 31, 2025, the Human Capital and Compensation Committee of the Board of Directors approved updated forms of our Change in Control Severance Agreement and our Severance Benefits Agreement for the Company's Executive Vice Presidents. The updated forms were approved following a periodic review of the Company's executive severance arrangements performed by the Human Capital and Compensation Committee in consultation with its independent compensation consultant. For the form of Change in Control Severance Agreement for Executive Vice Presidents, the cash severance provision has been updated to 2.0x annual target cash compensation from the 1.5x in the prior form of such agreement and provides that all the benefits in the agreement are contingent upon a CIC actually occurring within 18 months prior to or three months after the executive's termination. The updated Change in Control Severance Agreement also narrows the circumstances under which a qualifying termination giving rise to severance benefits may be deemed to have occurred, and eliminates payments to the executive of compensation during the pendency of, and reimbursement of legal fees in connection

------

with, good faith disputes that may arise under the agreement. For the form of Severance Benefits Agreement for Executive Vice Presidents, which apply to terminations outside the context of a CIC, the updated form provides for a prorated in-flight bonus for the year of termination tied to full-year actual performance compared with the prior form which did not provide such a bonus.

The foregoing description of the forms of Change in Control Agreement and Severance Benefits Agreement for Executive Vice Presidents does not purport to be complete and is qualified in its entirety by reference to the full text of such forms which are filed as Exhibits 10.2. and 10.3, respectively, to this Quarterly Report on Form 10-Q and are incorporated by reference into this Item 5.

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**ITEM 6. &nbsp;&nbsp;&nbsp;&nbsp;EXHIBITS**

The following Exhibits are filed or furnished, as applicable, herewith:

---

| | |
|:---|:---|
| <u>[10.1](https://www.sec.gov/Archives/edgar/data/1049521/000104952125000060/mercury-amendmentno7xame.htm)</u> | <u>[Amendment No. 7 to the Credit Agreement, dated November 4, 2025, among the Company, the Guarantors party thereto, the Lenders party thereto, and Wells Fargo Bank, National Association, as Administrative Agent (incorporated herein by reference to Exhibit No. 10.1 to the Company's Current Report on Form 8-K filed on November 4, 2025)](https://www.sec.gov/Archives/edgar/data/1049521/000104952125000060/mercury-amendmentno7xame.htm)</u> |
| <u>[10.2\*](amendmentno1toceoemploym.htm)</u> | <u>[Amendment No. 1 to the Employment Agreement, dated October 31, 2025, between the Company and William L. Ballhaus](amendmentno1toceoemploym.htm)</u> |
| <u>[10.3\*](a4achangeinctrlseverance.htm)</u> | <u>[Form of Change in Control Severance Agreement between the Company and Non-CEO Executives](a4achangeinctrlseverance.htm)</u> |
| <u>[10.4\*](xexecutiveseverancelette.htm)</u> | <u>[Form of Severance Benefits Agreement between the Company and Non-CEO Executives](xexecutiveseverancelette.htm)</u> |
| <u>[10.5\*](compensationpolicyfornon.htm)</u> | <u>[Compensation Policy for Non-Employee Directors](compensationpolicyfornon.htm)</u>  |
| <u>[10.6\*](a2026annualboardmemberrs.htm)</u> | <u>[Form of Restricted Stock Unit Agreement under the 2025 Long Term Incentive Plan (Non-Employee Directors)](a2026annualboardmemberrs.htm)</u> |
| <u>[10.7\*](a2026annualboardmemberds.htm)</u> | <u>[Form of Deferred Stock Unit Agreement under the 2025 Long Term Incentive Plan](a2026annualboardmemberds.htm)</u> |
| <u>[10.8\*](a2026rankfilersusrsurf26.htm)</u> | <u>[Form of Restricted Stock Unit Agreement under the 2025 Long Term Incentive Agreement (Employees)](a2026rankfilersusrsurf26.htm)</u> |
| <u>[10.9\*](a2026dcmpmatchingawardsd.htm)</u> | <u>[Form of Deferred Stock Unit Agreement under the 2025 Long term Incentive Plan (DCMP)](a2026dcmpmatchingawardsd.htm)</u> |
| <u>[31.1](mrcy-09262025xexx311.htm)</u> | <u>[Certification of the Company's Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](mrcy-09262025xexx311.htm)</u> |
| <u>[31.2](mrcy-09262025xexx312.htm)</u> | <u>[Certification of the Company's Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](mrcy-09262025xexx312.htm)</u> |
| <u>[32.1+](mrcy-09262025xexx321.htm)</u> | <u>[Certification of the Company's Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](mrcy-09262025xexx321.htm)</u> |
| 101.INS | eXtensible Business Reporting Language (XBRL) Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |
| 101.SCH | XBRL Taxonomy Extension Schema Document |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |

---

\*&nbsp;&nbsp;&nbsp;&nbsp;Identifies a management contract or compensatory plan in which an executive officer or director of the Company participates.

+&nbsp;&nbsp;&nbsp;&nbsp;Furnished herewith. This certificate shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

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**MERCURY SYSTEMS, INC.**

**Signatures**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in Andover, Massachusetts, on November 4, 2025.

---

| | |
|:---|:---|
| MERCURY SYSTEMS, INC. | MERCURY SYSTEMS, INC. |
| By: | /S/&nbsp;&nbsp;&nbsp;&nbsp;DAVID E. FARNSWORTH |
|  | **David E. Farnsworth** |
|  | **Executive Vice President,** |
|  | **Chief Financial Officer** |

---

## Exhibit 10.2

![](amendmentno1toceoemploym001.jpg)

1.1 1 AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT This Amendment No. 1 to Employment Agreement ("First Amendment") dated as of October 31, 2025, is made and entered into by and between Mercury Systems, Inc., a Massachusetts corporation (the "Company"), and William L. Ballhaus (the "Executive"). WHEREAS, the Company and the Executive are parties to an Employment Agreement dated as of August 15, 2023 (the "Agreement"); and WHEREAS, the parties hereto desire to amend the Agreement to add a "best net benefit limitation" provision consistent with the provisions contained in the Company's Change of Control Severance Agreements for Executive Vice Presidents; and WHEREAS, capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Agreement. NOW, THEREFORE, in consideration of the mutual covenants contained herein, the Company and the Executive agree as follows: 1. Section 10 of the Agreement is amended by adding the following as paragraph (l) thereto: (l) Best Net Benefit Limitation. (i) Anything contained in this Agreement to the contrary notwithstanding, if any of the payments or benefits received or to be received by the Executive (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any Person whose actions result in a Change of Control or any Person affiliated with the Company or such Person) (all such payments and benefits being hereinafter referred to as the "Total Payments") will be subject to the Excise Tax, the following provisions shall apply: (A) If the Total Payments, reduced by the sum of (a) the Excise Tax and (b) the total of the Federal, state, and local income and employment taxes payable by the Executive on the amount of the Total Payments which are in excess of the Threshold Amount, are greater than or equal to the Threshold Amount, the Executive shall be entitled to the full benefits payable under this Agreement. (B) If the Threshold Amount is less than (a) the Total Payments, but greater than (b) the Total Payments reduced by the sum of (1) the Excise Tax and (2) the total of the Federal, state and local income and employment taxes on the amount of the Total Payments which are in excess of the Threshold Amount, then the benefits payable under this Agreement shall be reduced (but not below zero) to the extent necessary so that the maximum Total Payments shall not exceed the Threshold Amount. In such event, the Executive will be permitted to request which component items of the Payment will be reduced, provided, however, that

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![](amendmentno1toceoemploym002.jpg)

1.1 2 the Executive must provide to the Company in writing his request within a reasonable time period established by the Company and the Company must in its discretion consent to such request (said consent not to be unreasonably withheld, delayed or conditioned) and absent such a request, the Company shall make its own determinations with respect to which items of the Total Payments are to be reduced. To the extent any payment is to be made over time (e.g., in installments), then the payments shall be reduced in reverse chronological order. (ii) The determination as to which of the alternative provisions of Section 10(l)(i) above shall apply to the Executive shall be made by a nationally recognized accounting firm selected by the Company (the "Accounting Firm"), which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (15) business days of the Date of Termination, if applicable, or at such earlier time as is reasonably requested by the Company or the Executive. For purposes of determining which of the alternative provisions of Section 10(l)(i) above shall apply, the Executive shall be deemed to pay Federal income taxes at the highest marginal rate of Federal income taxation applicable to individuals for the calendar year in which the determination is to be made, and state and local income taxes at the highest marginal rates of individual taxation in the state and locality of the Executive's residence on the Date of Termination, net of the maximum reduction in Federal income taxes which could be obtained from deduction of such state and local taxes. Any determination by the Accounting Firm shall be binding upon the Company and the Executive. 2. Section 4(h) of the Agreement is amended by adding the following definitions: (vii) "Excise Tax" shall mean any excise tax imposed under Section 4999 of the Code, and any interest or penalties incurred by the Executive with respective to such Excise Tax. (viii) "Threshold Amount" shall mean three times the Executive's "base amount" within the meaning of Section 280G(b)(3) of the Code and the regulations promulgated thereunder, less one dollar ($1.00). 3. All other provisions of the Agreement shall remain in full force and effect according to their respective terms, and nothing contained herein shall be deemed a waiver of any right or abrogation of any obligation otherwise existing under the Agreement except to the extent specifically provided for herein. 4. The validity, interpretation, construction, and performance of this First Amendment shall be governed by the laws of the State of Virginia. 5. This First Amendment may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument. [Remainder of Page Intentionally Left Blank]

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![](amendmentno1toceoemploym003.jpg)

1.1 3 IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand and, pursuant to the authorization from the independent directors on the Board of Directors, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written. MERCURY SYSTEMS, INC. By: Steve Ratner Title: Chief Human Resources Officer EXECUTIVE: William L. Ballhaus

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## Exhibit 10.3

![](a4achangeinctrlseverance001.jpg)

1 Change of Control Severance Agreement This Change of Control Severance Agreement ("Agreement"), dated as of [●] (the "Effective Date"), is entered into between Mercury Systems, Inc., a Massachusetts corporation (the "Company"), and [●] (the "Executive"). WHEREAS, the parties recognize that the Executive may provide important services to the Company before a Change of Control, and the parties desire for the Executive to remain employed with the Company through a Change of Control; and WHEREAS, it is in the best interests of the Company and its shareholders to encourage the continued attention and dedication of the Executive to the Executive's duties without distraction and to ensure the continued availability to the Company of the Executive in the event of a Change of Control. NOW, THEREFORE, in consideration of the foregoing and other respective covenants and agreements of the parties herein contained, the parties hereto agree as follows: 1. Term of Agreement. The term of this Agreement (the "Term") shall commence on the date hereof and shall continue in effect through June 30, 2026. Commencing on July 1, 2026 and each July 1 thereafter, the Term shall automatically be extended for one additional year unless, not later than September 30 of the preceding year, the Company or the Executive shall have given notice to the other of its intent not to extend the Term. If a Change of Control occurs during the Term, the Term shall expire no earlier than the last day of the twenty-fourth (24th) month following the month in which such Change of Control occurred. 2. Company's Covenants Summarized. To induce the Executive to remain in the employ of the Company, the Company shall pay to the Executive the severance payments and the other payments and benefits described herein pursuant to the conditions herein. This Agreement shall not be construed as creating an express or implied contract of employment and, except as otherwise agreed in writing between the Executive and the Company, the Executive shall not have any right to be an employee of the Company. 3. Termination of Employment. 3.1 Death or Disability. The Executive's employment shall terminate automatically upon the Executive's death. The Company may terminate the Executive's employment in the event of the Executive's Disability. 3.2 Termination by the Company. The Company may terminate the Executive's employment for Cause or without Cause. 3.3 Termination by the Executive. The Executive's employment may be terminated by the Executive for any reason, including with or without Good Reason. 3.4 Notice of Termination. Any termination by the Company or by the Executive shall be communicated by a Notice of Termination to the other parties hereto given in accordance with the notices provision of this Agreement. The failure by the Executive or the

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![](a4achangeinctrlseverance002.jpg)

2 Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive's or the Company's rights hereunder. If the Executive delivers a Notice of Termination to the Company, the Company may elect by written notice to the Executive to change the Date of Termination to an earlier date than the date in such Notice of Termination. Such change to the Date of Termination shall not affect the Company's rights to dispute any assertion by the Executive, shall only affect the actual Date of Termination and, for the avoidance of doubt, will in no event be deemed a termination by the Company without Cause. 4. Severance Payments in Connection With a Qualifying Termination Within a Change of Control Protection Period. If the Executive's employment with the Company is terminated during the Term as a result of a Qualifying Termination within three (3) months prior to or eighteen (18) months following a Change of Control (the "Change of Control Protection Period"), then, subject to and conditioned upon the Executive's compliance with this Agreement, including Section 5 hereof, and subject to and conditioned upon the Executive's compliance with the Executive's confidentiality agreement and any other agreements with the Company: 4.1 Cash Salary Severance. To the extent the Change of Control constitutes a "change in control event" (as defined in Treasury Regulation §1.409A-3(i)(5)) ("409A Change in Control"), the Company shall pay to the Executive an amount equal to two times (2x) the Executive's Base Salary in effect on the Date of Termination (provided, however, that if Executive terminates for Good Reason because of the Company's reduction of the Executive's Base Salary, then the Base Salary in effect before such material reduction will be the one used in this calculation) (the "CoC Salary Severance"), payable in a single lump-sum payment within sixty (60) days following the Date of Termination or the date the Change of Control is consummated, whichever is later. To the extent the Change of Control does not constitute a 409A Change in Control, the CoC Salary Severance shall instead be paid during the period beginning on the Date of Termination and ending on the twenty-four (24)-month anniversary of the Date of Termination in equal installments in accordance with the Company's regular payroll practices as of the Date of Termination, with the first payment being due and payable on the Company's next regular payday for executives following the sixty (60)-day anniversary of the Date of Termination (and such first payment shall be retroactive to the day immediately following the Executive's Date of Termination). 4.2 Cash Bonus Severance. The Executive shall be paid an amount equal to two times (2x) the Target Bonus for the fiscal year in which the Date of Termination occurs (the "CoC Bonus Severance") (provided, however, that if Executive terminates for Good Reason because of the Company's reduction of the Executive's Target Bonus, then the Target Bonus in effect before such reduction will be the one used in this calculation). The CoC Bonus Severance shall be payable in a single lump-sum payment within sixty (60) days following the Date of Termination or the date the Change of Control is consummated, whichever is later. 4.3 Pro-Rata Bonus. The Executive shall be paid an amount equal to the pro- rata portion of the Target Bonus for the fiscal year in which the Date of Termination occurs (pro- rated based on the number of days the Executive was employed by the Company during such fiscal

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3 year), payable in a single lump-sum payment within sixty (60) days following the Date of Termination or the date the Change of Control is consummated, whichever is later. 4.4 Equity Acceleration – Time-Based Equity Awards. As of the Date of Termination or the date of consummation of the Change of Control, whichever is later, any unvested portion of each outstanding equity award that is subject solely to time-based vesting (a "Time-Based Equity Award") held by the Executive as of the date of such Change of Control shall vest and become exercisable or nonforfeitable; provided, however, that, the settlement of any awards subject to Section 409A shall occur at the time otherwise contemplated by the associated award agreement. 4.5 Equity Acceleration – Performance-Based Equity Awards. As of the Date of Termination or the date of consummation of the Change of Control, whichever is later, any unvested outstanding equity awards that are subject to performance-based vesting (a "Performance-Based Equity Award") held by the Executive as of the date of such Change of Control shall become vested and exercisable or nonforfeitable based on the greater of actual or target performance as of the Date of Termination; provided, however, that, the settlement of any awards subject to Section 409A shall occur at the time otherwise contemplated by the associated award agreement. 4.6 COBRA. During the period commencing on the Date of Termination and ending on the earlier of the eighteen (18)-month anniversary of the Date of Termination or the date that the Executive becomes eligible for substantially similar benefits under the health insurance policy of any subsequent employer (the "COBRA Period"), subject to the Executive's valid election to continue healthcare coverage under Section 4980B of the Code, the Company shall continue to provide the Executive and the Executive's eligible dependents with coverage under its group health plans at active employee rates, provided, however, that (A) if any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (B) the Company is otherwise unable to continue to cover the Executive under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act or the Patient Protection and Affordable Care Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to the Executive in substantially equal monthly installments over the continuation coverage period (or the remaining portion thereof). 4.7 Outplacement Services. The Company shall pay the cost of providing the Executive with outplacement services up to a maximum of $45,000, provided that (i) the Executive begins to utilize such services within six months following the Date of Termination and completes the utilization of such services no later than the last day of the calendar year following the calendar year that contains the Date of Termination, and (ii) such services are provided by an outplacement provider approved by the Company (which approval shall not be unreasonably withheld, delayed or conditioned). Such payment shall be made by the Company directly to the service provider promptly following the provision of such services and the presentation to the Company of documentation of the provision of such services.

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4 4.8 Accrued Obligations. The Company will pay or provide to the Executive: (i) any earned but unpaid Base Salary, (ii) reimbursement of any business expenses incurred by the Executive prior to the Date of Termination that are reimbursable in accordance with the Company's policy in effect from time to time and (iii) any vested amounts due to the Executive under any plan, program or policy of the Company (together, the "Accrued Obligations"). The Accrued Obligations described in clauses (i) – (ii) of the preceding sentence shall be paid within 30 days after the Date of Termination (or such earlier date as may be required by applicable law) and the Accrued Obligations described in clause (iii) of the preceding sentence shall be paid in accordance with the terms of the governing plan or program 4.9 No Duplication of Benefits. In the event that the Qualifying Termination occurs prior to the Change in Control, any payments or benefits already received by the Executive pursuant to any severance-based policy maintained by, or agreement entered into with, the Company shall be taken into account or deducted from) any corresponding payment or benefits the Executives becomes entitled to pursuant to this Section 4. 5. Release. Notwithstanding the foregoing, it shall be a condition to the Executive's right to receive the amounts provided for in Sections 4 of this Agreement (other than Section 4.8, which shall not be so conditioned) that the Executive execute and deliver to the Company an effective release of claims in substantially the form attached hereto as Exhibit A (the "Release") within twenty-one (21) days (or, to the extent required by law to constitute a full release of age- discrimination related claims, forty-five (45) days) following the Date of Termination and that the Executive not revoke such Release during any applicable revocation period. 6. Termination of Offices and Directorships; Return of Property. Upon termination of the Executive's employment for any reason, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions if any, then held with the Company Group, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive's employment for any reason, the Executive agrees to return to the Company all documents of the Company Group (and all copies thereof) and all other Company Group property that the Executive has in his possession, custody or control. Such property includes, without limitation: (i) any materials of any kind that the Executive knows contain or embody any proprietary or confidential information of the Company Group (and all reproductions thereof), (ii) computers (including, but not limited to, laptop computers, desktop computers and similar devices) and other portable electronic devices (including, but not limited to, tablet computers), cellular phones/smartphones, credit cards, phone cards, entry cards, identification badges and keys, and (iii) any correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the customers, business plans, marketing strategies, products and/or processes of the Company Group and any information received from the Company Group regarding third parties. 7. Six-Month Delay. Notwithstanding anything to the contrary in this Agreement, no compensation or benefits, including without limitation any severance payments or benefits payable under this Agreement, shall be paid to the Executive during the six (6)-month period following the Executive's "separation from service" from the Company (within the meaning of Section 409A, a "Separation from Service") if the Company determines that paying such amounts at the time or

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5 times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first day of the seventh month following the date of Separation from Service (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as a result of the Executive's death), the Company shall pay the Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Executive during such period. 8. Best Net Benefit Limitation. 8.1 Anything contained in this Agreement to the contrary notwithstanding, if any of the payments or benefits received or to be received by the Executive (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any Person whose actions result in a Change in Control or any Person affiliated with the Company or such Person) (all such payments and benefits being hereinafter referred to as the "Total Payments") will be subject to the Excise Tax, the following provisions shall apply: (A) If the Total Payments, reduced by the sum of (a) the Excise Tax and (b) the total of the Federal, state, and local income and employment taxes payable by the Executive on the amount of the Total Payments which are in excess of the Threshold Amount, are greater than or equal to the Threshold Amount, the Executive shall be entitled to the full benefits payable under this Agreement. (B) If the Threshold Amount is less than (a) the Total Payments, but greater than (b) the Total Payments reduced by the sum of (1) the Excise Tax and (2) the total of the Federal, state and local income and employment taxes on the amount of the Total Payments which are in excess of the Threshold Amount, then the benefits payable under this Agreement shall be reduced (but not below zero) to the extent necessary so that the maximum Total Payments shall not exceed the Threshold Amount. In such event, the Executive will be permitted to request which component items of the Payment will be reduced, provided, however, that the Executive must provide to the Company in writing his or her request within a reasonable time period established by the Company and the Company must in its discretion consent to such request (said consent not to be unreasonably withheld, delayed or conditioned) and absent such a request, the Company shall make its own determinations with respect to which items of the Total Payments are to be reduced. To the extent any payment is to be made over time (e.g., in installments), then the payments shall be reduced in reverse chronological order. 8.2 The determination as to which of the alternative provisions of Section 8.1 above shall apply to the Executive shall be made by a nationally recognized accounting firm selected by the Company (the "Accounting Firm"), which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (15) business days of the Date of Termination, if applicable, or at such earlier time as is reasonably requested by the Company or the Executive. For purposes of determining which of the alternative provisions of Section 8.1 above shall apply, the Executive shall be deemed to pay Federal income taxes at the highest marginal rate of Federal income taxation applicable to individuals for the calendar year in which the determination is to be made, and state and local income taxes at the highest marginal rates of individual taxation in the state and locality of the Executive's residence on the Date of

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6 Termination, net of the maximum reduction in Federal income taxes which could be obtained from deduction of such state and local taxes. Any determination by the Accounting Firm shall be binding upon the Company and the Executive. 9. Definitions. For purposes of this Agreement, the following terms shall have the meanings indicated below: 9.1 "Base Salary" shall mean the Executive's base salary per year. 9.2 "Board" shall mean the Board of Directors of the Company. 9.3 "Cause" shall mean the occurrence of any one or more of the following events unless, with respect to clauses (A), (D), (E), (F), or (G), the Executive fully corrects the circumstances constituting Cause (provided such circumstances are capable of correction) within fifteen (15) days after receipt of the Notice of Termination (as defined below): A. the Executive's breach of fiduciary duty, breach of duty of loyalty, or willful and continued failure to perform substantially the duties and responsibilities of the Executive's position with the Company Group after a written demand for performance is delivered to the Executive or the Executive's gross negligence in the performance of his duties for the Company Group; B. the Executive's commission of, or a plea of nolo contendere to, a felony under the laws of the United States or any state thereof or any crime involving dishonesty or moral turpitude (or any similar crime in any jurisdiction outside the United States); C. the Executive's willful engagement in fraud or dishonesty with respect to any member of the Company Group or other misconduct which is, or is reasonably expected to be, materially injurious to any member of the Company Group; D. the Executive's unauthorized use or disclosure of confidential information or trade secrets of the Company Group; E. any act or omission of the Executive that constitutes a material breach by the Executive of (x) any of his obligations under any agreement between any member of the Company Group and Executive (including, without limitation, this Agreement, any restrictive covenant obligations set forth in any equity award agreement, and the Executive's confidentiality agreement with the Company), or (y) any material Company policy; F. the Executive's failure to cooperate with, or comply with instructions relating to any internal investigation by the Company Group or administrative, regulatory or judicial proceeding or investigation involving any member of the Company Group upon request by the Company Group (including, but not limited to, any instruction to preserve documentation related thereto);

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7 G. any act, omission or statement by the Executive which is, or is reasonably expected to be, materially injurious to any member of the Company Group (including acts regarding sexual harassment or discrimination); or H. the Executive's failure to obtain and/or retain security clearances necessary for him to perform his duties and responsibilities for the Company. For purposes of this definition of "Cause," no act, or failure to act, on Executive's part shall be deemed "willful" unless committed or omitted by the Executive in bad faith and without reasonable belief that the Executive's act or failure to act was in, or not opposed to, the best interest of the Company. 9.4 "Change of Control" shall mean the occurrence of any of the following: A. Any "Person," as such term is used in Sections 13(d) and 14(d) of the Exchange Act (other than the Company, any of its subsidiaries, or any trustee, fiduciary or other person or entity holding securities under any employee benefit plan or trust of the Company or any of its subsidiaries), together with all "affiliates" and "associates" (as such terms are defined in Rule 12b-2 under the Exchange Act) of such person, shall become the "beneficial owner" (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing thirty percent (30%) or more of the combined voting power of the Company's then outstanding securities having the right to vote in an election of the Board ("Voting Securities") (in such case other than as a result of an acquisition of securities directly from the Company or an acquisition of securities involving a Corporate Transaction of the type described in the exclusion set forth in clause (C) below); or B. Persons who, as of the Effective Date, constitute the Company's Board (the "Incumbent Directors") cease for any reason, including, without limitation, as a result of a tender offer, proxy contest, merger or similar transaction, to constitute at least a majority of the Board, provided that any person becoming a director of the Company subsequent to the Effective Date shall be considered an Incumbent Director if such person's election was approved by or such person was nominated for election by either (x) a vote of at least a majority of the Incumbent Directors or (y) a vote of at least a majority of the Incumbent Directors who are members of a nominating committee comprised, in the majority, of Incumbent Directors; but provided further, that any such person whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of members of the Board or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board, including by reason of agreement intended to avoid or settle any such actual or threatened contest or solicitation, shall not be considered an Incumbent Director; or C. The consummation of a consolidation, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (a

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8 "Corporate Transaction"); excluding, however, a Corporate Transaction in which the shareholders of the Company immediately prior to the Corporate Transaction, would, immediately after the Corporate Transaction, beneficially own (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, shares representing in the aggregate more than fifty percent (50%) of the voting shares of the corporation issuing cash or securities in the Corporate Transaction (or of its ultimate parent corporation, if any). Notwithstanding the foregoing, a "Change of Control " shall not be deemed to have occurred for purposes of the foregoing clause (A) solely as the result of an acquisition of securities by the Company that, by reducing the number of shares of Voting Securities outstanding, increases the proportionate number of shares of Voting Securities beneficially owned by any person to thirty percent (30%) or more of the combined voting power of all then outstanding Voting Securities; provided, however, that if any person referred to in this sentence shall thereafter become the beneficial owner of any additional shares of Voting Securities (other than pursuant to a stock split, stock dividend, or similar transaction or as a result of an acquisition of securities directly from the Company) and immediately thereafter beneficially owns thirty percent (30%) or more of the combined voting power of all then outstanding Voting Securities, then a "Change of Control" shall be deemed to have occurred for purposes of the foregoing clause (A) . 9.5 "Code" shall mean the Internal Revenue Code and the regulations thereunder. 9.6 "Company Group" shall mean the Company and/or its subsidiaries and affiliates. 9.7 "Date of Termination" shall mean the date on which the Executive's employment with the Company terminates. 9.8 "Disability" shall mean that, due to the Executive's incapacity due to physical or mental illness, (A) the Executive shall have been, or is determined by the Executive's supervisor as reasonably likely to be, absent from the full-time performance of the Executive's duties with the Company for a period of ninety (90) calendar days in the aggregate in any twelve (12) month period, (B) the Company shall have given the Executive a Notice of Termination for Disability, and (C) within thirty (30) days after such Notice of Termination is given, the Executive shall not have returned to the full-time performance of the Executive's duties (or it remains the case that the Executive is reasonably likely to be absent for such period as determined by the Executive's supervisor). 9.9 "Excise Tax" shall mean any excise tax imposed under Section 4999 of the Code, and any interest or penalties incurred by the Executive with respective to such Excise Tax. 9.10 "Good Reason" shall mean the occurrence of any one or more of the following events without the Executive's prior written consent, unless the Company fully corrects the circumstances constituting Good Reason (provided such circumstances are capable of correction) as provided below:

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9 A. a material diminution in the Executive's title, responsibilities, authority or duties as in effect on the Effective Date; B. the Company's reduction of the Executive's Base Salary or Target Bonus, except for, in either case, across-the-board reductions similarly affecting all or substantially all named executive officers of the Company; C. the Company's material reduction of the aggregate target value of the Executive's annual equity award, except for across-the-board reductions similarly affecting all or substantially all named executive officers of the Company; or D. a material change in the geographic location at which the Executive is required to provide services to the Company (but, for the avoidance of doubt, not on account of business travel and not any relocation where the Executive is given the opportunity to work remotely). Notwithstanding the foregoing, the Executive will not be deemed to have resigned for Good Reason unless (1) the Executive provides the Company with written notice setting forth in reasonable detail the facts and circumstances claimed by the Executive to constitute Good Reason within sixty (60) days after the date of the occurrence of any event that the Executive knows or should reasonably have known to constitute Good Reason, (2) the Company fails to cure such acts or omissions within thirty (30) days following its receipt of such notice, and (3) the effective date of the Executive's termination for Good Reason occurs no later than sixty (60) days after the expiration of the Company's cure period. 9.11 "Notice of Termination" shall mean a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated and (iii) if the Date of Termination is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty (30) days after the giving of such notice). 9.12 "Qualifying Termination" shall mean the termination of the Executive's employment with the Company (a) by the Company without Cause, or (b) by the Executive with Good Reason. 9.13 "Target Bonus" shall mean the target bonus amount for the Executive, assuming attainment of 100% of performance targets. 9.14 "Threshold Amount" shall mean three times the Executive's "base amount" within the meaning of Section 280G(b)(3) of the Code and the regulations promulgated thereunder, less one dollar ($1.00). 10. Mitigation. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and any amounts payable pursuant to this Agreement shall not

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10 be reduced by compensation the Executive earns on account of employment with another employer. 11. Litigation and Regulatory Cooperation. During and after the Executive's employment, the Executive shall cooperate fully with the Company Group in the defense or prosecution of any claims or actions now in existence or which may be brought in the future against or on behalf of the Company Group which relate to events or occurrences that transpired while the Executive was employed by the Company. The Executive's full cooperation in connection with such claims or actions shall include, but not be limited to, being available to meet with counsel to prepare for discovery or trial and to act as a witness on behalf of the Company Group at mutually convenient times. During and after the Executive's employment, the Executive also shall cooperate fully with the Company Group in connection with any investigation or review of any federal, state or local regulatory authority as any such investigation or review relates to events or occurrences that transpired while the Executive was employed by the Company. The Company shall reimburse the Executive for any reasonable and documented out-of-pocket expenses incurred in connection with the Executive's performance of obligations pursuant to this section, based on the standards and procedures applicable to expense reimbursement for the Company's employees; and, to the extent applicable rules of professional responsibility would preclude the Company's counsel from assisting the Executive in carrying out the provisions of this section, pay the reasonable and documented attorney's fees of counsel reasonably selected by the Executive in connection with the foregoing, provided that the Executive provides the Company with reasonable notice prior to retaining such counsel. 12. Mutual Waiver of Jury Trial. THE PARTIES EACH WAIVE THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY AFFILIATE OF ANY OTHER SUCH PARTY, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS OR OTHERWISE. THE PARTIES EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION WILL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION HEREOF. THIS WAIVER WILL APPLY TO ANY SUBSEQUENT AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. 13. Successors. 13.1 This Agreement is personal to the Executive and, without the prior written consent of the Company, shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive's legal representatives.

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11 13.2 This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns, and such parties shall be bound by the Company's obligations hereunder. 14. Clawback/Recoupment. Notwithstanding any other provision in this Agreement to the contrary, any compensation paid to the Executive pursuant to this Agreement or any other agreement or arrangement with the Company shall be subject to mandatory repayment by the Executive to the Company, to the extent any such compensation paid to the Executive is, or in the future becomes, subject to (i) any lawful clawback or recoupment policy adopted by the Company that applies to the Company's executive officers, or (ii) any law, government regulation or stock exchange listing requirement which imposes mandatory recoupment, under circumstances set forth in such law, government regulation or stock exchange listing requirement. 15. Miscellaneous. 15.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. 15.2 Notices. All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows: If to the Executive: at the Executive's most recent address on the records of the Company. If to the Company: Mercury Systems, Inc. Attention: Legal Department 50 Minuteman Road Andover, MA 01810 or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee. 15.3 Sarbanes-Oxley Act of 2002. Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that any transfer or deemed transfer of funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the "Exchange Act"), then such transfer or deemed transfer shall not be made to the extent necessary or appropriate so as not to violate the Exchange Act and the rules and regulations promulgated thereunder. 15.4 Section 409A of the Code. (A) To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder (together, "Section 409A"). Notwithstanding any

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12 provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be subject to Section 409A, the Company shall work in good faith with the Executive to adopt such amendments to this Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (A) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (B) comply with the requirements of Section 409A; provided, however, that this Section 10(d) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so. Notwithstanding anything herein to the contrary, in no event shall any liability for failure to comply with the requirements of Section 409A be transferred from the Executive or any other individual to any member of the Company Group or any of their employees or agents pursuant to the terms of this Agreement or otherwise. (B) Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed "nonqualified deferred compensation" subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment) occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be made upon a termination of employment under this Agreement may only be made upon the Executive's Separation from Service. (C) To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive's right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit. 15.5 Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. 15.6 Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation. 15.7 No Waiver. The Executive's or the Company's failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive

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13 or the Company may have hereunder shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement. 15.8 Entire Agreement. As of the Effective Date, this Agreement constitutes the final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, by any member of the Company Group, or representative thereof. 15.9 Amendment; Survival. No amendment or other modification of this Agreement shall be effective unless made in writing and signed by the parties hereto. The respective rights and obligations of the parties under this Agreement shall survive the Executive's termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations. 15.10 Counterparts. This Agreement and any agreement referenced herein may be executed in two or more counterparts, each of which shall be deemed an original but which together shall constitute one and the same instrument. [Signature Page Follows]

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14 IN WITNESS WHEREOF, the undersigned officer, on behalf of Mercury Systems, Inc., and the Executive have hereunto set their hands as an agreement under seal, all as of the date first above written. MERCURY SYSTEMS, INC. [●] EXECUTIVE: Name: [●]

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15 Exhibit A General Release of Claims The undersigned [●] (the "Releasor"), does hereby agree to the following General Release of Claims (the "Release"), for good and valuable consideration, including but not limited to the promises made by Mercury Systems, Inc. (the "Company") to Releasor in the Change of Control Severance Agreement (the "Agreement"): 1. The Releasor, for Releasor and Releasor's heirs, agents, representatives, and each of their respective affiliates, successors and assigns, as applicable (collectively, the "Releasing Parties"), hereby unconditionally and forever remises, releases, discharges and holds harmless, the Company and its subsidiaries, parent companies, affiliates and clients, and each of their respective direct and indirect equity holders, directors, managers, officers, employees, agents, trustees, representatives, insurers, and/or affiliates, and each of the successors and assigns of all of the foregoing (collectively, the "Released Parties"), of and from any and all actions, proceedings, claims, causes of action, suits, debts, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, controversies, contracts, leases, agreements, promises, variances, trespasses, damages, judgments, executions, claims and demands, of any nature whatsoever, and of every kind and description, choate and inchoate, at law or in equity (collectively, "Claims"), which any of the Releasing Parties now has or ever might claim to have against any or all of the Released Parties, whether or not currently asserted or known, arising from or relating to any event, dispute or occurrence which arose at any time on or prior to the date hereof, including, without limitation, with respect to (i) the Releasor's ownership of any equity or securities in, and/or the purchase thereof by, the Company, or its clients or affiliates; (ii) any and all Claims alleging discrimination, harassment, or retaliation on the basis of any characteristic protected under law, including but not limited to race, national origin, sex, religion, disability, union activity, or other protected activity; (iii) any Claims arising under the Age Discrimination in Employment Act ("ADEA"), as amended, 29 U.S.C. § 621, et seq.; the Title VII of the Civil Rights Act of 1964, as amended by the Civil Rights Act of 1991, 42 U.S.C. § 2000 et seq.; the Equal Pay Act, as amended, 29 U.S.C. § 206(d); the Civil Rights Act of 1866, 42 U.S.C. § 1981; the Family and Medical Leave Act of 1993, 29 U.S.C. § 2601 et seq.; the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq.; the False Claims Act , 31 U.S.C. § 3729 et seq.; the Employee Retirement Income Security Act, as amended, 29 U.S.C. § 1001 et seq.; the Worker Adjustment and Retraining Notification Act, as amended, 29 U.S.C. § 2101 et seq. the Fair Labor Standards Act, 29 U.S.C. § 215 et seq., the Sarbanes-Oxley Act of 2002; Massachusetts Fair Employment Practices Act (M.G.L. ch. 151B, §§ 1 to 10); Massachusetts Equal Pay Act (M.G.L. ch. 149, § 105A); Massachusetts Equal Rights Act (M.G.L. ch. 93, § 102); Massachusetts Age Discrimination Law (M.G.L. ch. 149, § 24A et seq.); Massachusetts Civil Rights Act (M.G.L. ch. 12, § 11); Massachusetts Small Necessities Act (M.G.L. ch. 149, § 52D); Massachusetts Privacy Statute (M.G.L. ch. 214, § 1B); Massachusetts Parental Leave Act (M.G.L. ch. 149, § 105D); Massachusetts AIDS Testing Act (M.G.L. ch. 111, § 70F); Massachusetts Consumer Protection Act (M.G.L. ch. 93A); Massachusetts Equal Rights for the Elderly and Disabled Law (M.G.L. ch. 93, § 103); Massachusetts Anti-Sexual Harassment Statute (M.G.L. ch. 214, § 1C); Massachusetts Wage and Hour Laws (M.G.L. ch. 151, § 1A et seq.); Massachusetts Wage Act (M.G.L. c. 149 §§

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16 148 to 150); [__________]1, all as may be amended from time to time, or any other federal, state, or local law, including any statutes, regulations, constitutions, ordinances, or orders regarding employment or otherwise; (iv) Claims for breach of contract (including any employment offer letter or agreement or other agreement entered into in connection with employment), violation of any policy, benefit plan, or covenant of any kind, and/or breach of the implied covenant of good faith and fair dealing; (v) Claims arising in tort, including, without limitation, wrongful dismissal or discharge, harassment, retaliation, fraud, negligence, misrepresentation, defamation, infliction of emotional distress, invasion of privacy, or violation of any public policy or common law; and (vi) Claims for damages or other remedies of any sort, including, without limitation, compensatory damages, punitive damages, injunctive relief and attorney's fees. 2. The Releasor, on behalf of Releasor and the other Releasing Parties, specifically waives the benefits of any statutory or common law of any state, which in effect provides that a general release does not extend to claims which the Releasor does not know or suspect to exist in its favor. It is expressly understood and agreed that the releases contained herein are intended to cover and do cover all known facts and/or claims, as well as any further facts and/or claims within the scope of such released Claims not known or anticipated, but which may later develop or be discovered, including all the effects and consequences thereof, in each case arising from or relating to any event, dispute or occurrence which arose on or prior to the date hereof. The Releasor, on behalf of Releasor and the other Releasing Parties, acknowledges that the Releasor may hereafter discover facts in addition to, or different from, those which the Releasor now believes to be true with respect to the subject matter of the Claims released herein, but agrees that the Releasor has taken that possibility into account in reaching this agreement, and that the releases given herein shall be and remain in effect notwithstanding the discovery or existence of any such additional or different facts, as to which the Releasing Parties expressly assume the risk. In connection with such waiver and relinquishment, the Releasor, on behalf of the Releasor and the other Releasing Parties, hereby acknowledges that the Releasor is aware that Releasor's attorneys may hereafter discover claims or facts in addition to, or different from, those which they now know or believe to exist with respect to the subject matter of, or any part of this Release, but that it is nonetheless their intention to fully, finally and forever settle and release all disputes and differences, known or unknown, suspected or unsuspected, as to the released matters, in each case arising from or relating to any event, dispute or occurrence which arose on or prior to the date hereof. 3. Without limiting the generality of the foregoing, the Releasor hereby agrees, on behalf of Releasor and the other Releasing Parties, that this General Release of Claims extends to all rights of the Releasor and the other Releasing Parties under Section 1542 of the California Civil Code and any similar law of any state or territory of the United States, all of which are hereby expressly waived by the Releasor. The Releasor, on behalf of Releasor and the other Releasing Parties, hereby waives and relinquishes all rights and benefits afforded by Section 1542 of the California Civil Code (if any). Section 1542 of the California Civil Code provides as follows: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, 1 The Company may modify this General Release to pick up the laws of the locations where the Executive worked and/or resided.

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17 WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY." 4. The Releasor represents, warrants and covenants on behalf of Releasor and the other Releasing Parties that there has been, and there will be, no assignment or other transfer of any right or interest arising from or relating to any Releasing Party's ownership of any securities of the Company or any of its direct or indirect subsidiaries, or any entity advised by the Company, or any Claims which they have or may have against the Released Parties, and the Releasor hereby agrees to indemnify and hold each Released Party harmless from any Claims, costs, expenses and reasonable attorney's fees directly or indirectly incurred by any of the Released Parties as a result of any person asserting any right or interest pursuant to its assignment or transfer of any such right or interest. 5. The Releasor covenants and shall use reasonable best efforts to cause the other Releasing Parties, never to institute any Claim whether at law or in equity, against any or all of the Released Parties, in any court or administrative agency or before any other public or private tribunal. 6. The Releasor agrees that if the Releasor or any other Releasing Party hereafter commences, joins in, or in any manner seeks relief through any action (including, without limitation, any complaint, cross-claim, counterclaim, third-party complaint or interpleader complaint in any jurisdiction or any action before an administrative or regulatory agency) arising out of, based upon or relating to any of the Claims released by them hereunder, or in any manner assert against any Released Party any of the Claims released hereunder, then the Releasor will indemnify and hold harmless the Released Parties from any settlements, judgments, costs and expenses (including reasonable attorneys' fees and costs) incurred by such person or entity as a result of or in connection with such action. 7. Notwithstanding anything to the contrary contained herein, in no event shall this Release apply to any Claims that may arise from (i) any rights or claims to indemnification under the organizational documents of the Company or any of its subsidiaries or any entity advised by the Company of which the Releasing Party is a director, manager, or officer, under directors and officers liability insurance or under applicable law, (ii) any claim Releasor may have relating to workers compensation or unemployment benefits under applicable state law, (iii) any Claims that may not be released as a matter of law. Further, nothing herein shall restrict Releasor from filing a charge with, or participating in any proceeding conducted by, the Equal Employment Opportunity Commission or similar state agency; provided, however, this General Release of Claims does release any right to secure damages or other relief awarded in connection with such a proceeding brought by or on behalf of Releasor. 8. The Releasor acknowledges that (i) the Releasor has the right to consult with independent legal counsel in connection with this Release, the Company is herein advising Releasor in writing to consult with such counsel, and the Releasor either has consulted with such counsel or voluntarily chosen not to; (ii) the Releasor has read and understands this Release; and (iii) the Releasor intends to be legally bound by the same.

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18 9. The Releasor has [twenty-one (21) or forty-five (45)] days to consider whether or not to sign this Release and, if the Releasor signs this Release prior to the expiration of such [twenty-one (21) or forty-five (45)] day period, the Releasor waives the remainder of that period. The Releasor waives the restarting of the [twenty-one (21) or forty-five (45)] day period in the event of any modification of this Release, whether or not material. The Releasor may revoke Releasor's acceptance of this Release by delivering written notice of revocation to the General Counsel and Secretary of the Company within the seven (7) day period beginning on the day following the day the Releasor signs this Release (the "revocation period"). To be valid, such revocation must be express and in writing, and personally delivered or sent by certified mail and received by the Company before the expiration of the revocation period. If the Releasor does not revoke acceptance of this Release within the revocation period as provided herein, this Release will be legally binding, irrevocable, and enforceable on the day immediately following the last day of the revocation period. 10. [The Releasor acknowledges that the Releasor has received a list of job titles and ages of all employees eligible for similar severance benefits and the job titles and ages of all employees in the same job classification or organizational unit who are not eligible for similar severance benefits, as well as other information required under the Older Workers Benefits Protection Act to constitute a knowing and voluntary waiver.]2 11. The Releasor acknowledges and agrees that, if any provision of this Release is found, held, or deemed by a court of competent jurisdiction to be void, unlawful or unenforceable under any applicable statute or controlling law, the remainder of this Release shall continue in full force and effect. 12. This Release is deemed made and entered into in [●]3, and in all respects shall be interpreted, enforced, and governed under the internal laws of [●], to the extent not preempted by federal law. IN WITNESS WHEREOF, the Releasor has executed and delivered this General Release of Claims on behalf of Releasor and the other Releasing Parties as of the day and year set forth below. Releasor: ________________________________ [EXECUTIVE] Date: ____________, 20__ 2 To be included in agreements for Executives over the age of 40 and modified as appropriate for the applicable law. 3 To reference the state where the Executive resided and/or worked, at the Company's election.

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## Exhibit 10.4

![](xexecutiveseverancelette001.jpg)

/Mercury Proprietary/No Tech Data/ [Date] [Name] Re: Severance Benefits Dear [First], If your employment with Mercury Systems, Inc. ("Mercury" or the "Company") is terminated by Mercury for any reason other than Cause, or if you terminate your employment for Good Reason, you will be entitled to receive, subject to your execution of the Company's standard form separation agreement, the following severance benefits: (i) cash severance in the form of (a)12 months of base salary continuation and (b) a lump sum payment of your target annual bonus; (ii) a lump sum payment in respect of your "in-flight" bonus for the fiscal year in which you are terminated, to be made following the end of the fiscal year based on full-year financial performance and prorated to reflect the portion of your actual service during the fiscal year prior to your termination, (iii) up to $30,000 of executive outplacement; and (iv) subject to your valid election to continue your healthcare coverage under COBRA, subsidized premiums under the Company's medical, dental, and vision plans for 12 months at the same portion of the premium as the Company pays with respect to active employees, or until you obtain benefits with another employer, whichever occurs first. "Cause" is defined to include: the willful and continued failure to perform substantially the duties and responsibilities of your position with Mercury after written demand or conviction by a court of competent jurisdiction for felony criminal conduct or a plea of nolo contendere to a felony; or the willful engaging in fraud, dishonesty or other misconduct which is demonstrably and materially injurious to Mercury or our reputation, monetarily or otherwise. No act, or failure to act, on your part will be deemed "willful" unless committed or omitted by you in bad faith and without reasonable belief that your act or failure to act was in, or not opposed to, the best interest of Mercury. "Good Reason" is defined to include: a material diminution in your responsibilities, authority or duties as in effect on the date of the acceptance or a material diminution in your annual base salary, except for across-the-board salary reductions based on our financial performance similarly affecting all or substantially all senior management employees of Mercury; or a material change in the geographic location at which you provide services to Mercury. Please sign one copy of this letter agreement and return it to the attention of our Chief Human Resources Officer. Very truly yours, William L. Ballhaus President and Chief Executive Officer Accepted Date

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## Exhibit 10.5

![](compensationpolicyfornon001.jpg)

/Mercury Proprietary/No Tech Data/ MERCURY SYSTEMS, INC. Compensation Policy for Non-Employee Directors Cash Compensation Annual retainer for non-employee directors: $75,000 per annum, paid quarterly Additional annual retainers (all per annuum, paid quarterly): Independent Chair: $45,000 Lead Independent Director: $40,000 Chair of the Audit Committee: $25,000 Chair of the Human Capital and Compensation Committee: $20,000 Chair of the Nominating and Governance Committee: $12,000 Chair of the M&A and Finance Committee: $12,000 Chair of the Government Relations Committee: $12,000 Directors are entitled to be reimbursed for their reasonable expenses incurred in connection with attendance at Board and committee meetings. Quarterly retainer payments shall be paid in arrears within 30 days following the end of each quarter. The full quarterly retainer shall be paid to each director who served on the Board during all or a portion of a quarter. Equity Compensation New non-employee directors will be granted equity awards in connection with their first appointment or election to the Board. These awards will be granted by the Board of Directors and will consist of shares of restricted stock units for the number of shares of common stock equal to $225,000 divided by the average closing price of the Company's common stock during the 30 calendar days prior to the date of grant. These awards will vest as to 50% of the covered shares on each of the first two anniversaries of the date of grant. Non-employee directors will also receive annual restricted stock unit awards for the number of shares of common stock equal to $185,000 divided by the average closing price of the Company's common stock during the 30 calendar days prior to the date of grant. These awards will vest on the first anniversary of the date of grant. Non-employee directors will not be eligible to receive an annual restricted stock unit award during the fiscal year in which they are first elected.

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/Mercury Proprietary/No Tech Data/ Compensation Deferrals Non-employee directors will be given an annual opportunity to defer equity compensation in compliance with applicable law by electing to receive deferred stock units that convert into shares of common stock upon termination of Board service (and not upon vesting). Similarly, non-employee directors will be given an annual opportunity to defer cash retainer payments in compliance with applicable law by electing to receive deferred stock units in lieu of such payments, which will be fully vested upon grant but will not convert into shares of common stock until termination of Board service. Subject to applicable law, new non-employee directors will be given an opportunity to defer their equity and/or cash compensation effective upon the commencement of their Board service, provided that they make such election prior to that time. Approved by the Board of Directors, as amended, on July 22, 2025.

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## Exhibit 10.6

![](a2026annualboardmemberrs001.jpg)

RESTRICTED STOCK UNIT AGREEMENT UNDER THE MERCURY SYSTEMS, INC. 2025 LONG TERM INCENTIVE PLAN Name of Grantee: #ParticipantName# No. of Phantom Stock Units Granted: #QuantityGranted# Grant Date: #GrantDate# Pursuant to the Mercury Systems, Inc. 2025 Long Term Incentive Plan as amended through the date hereof (the "Plan"), Mercury Systems, Inc. (the "Company") hereby grants a restricted stock unit award consisting of the number of phantom stock units listed above (an "Award") to the Grantee named above. Capitalized terms not otherwise defined herein shall have the respective meanings ascribed to them under the Plan. Each phantom stock unit shall relate to one Share of Common Stock of the Company, subject to the restrictions and conditions set forth herein and in the Plan. 1. Restrictions on Transfer of Award. This Agreement and the underlying Award shall be subject to the restrictions on transferability set forth in Section 14(g) of the Plan until (i) the phantom stock units have vested as provided in Section 2 of this Agreement, and (ii) Shares have been issued pursuant to Section 4 of this Agreement. 2. Vesting of Phantom Stock Units. The phantom stock units shall vest in accordance with the schedule set forth below (or if earlier, on the date of the Company's next annual shareholders meeting), subject to the acceleration events provided for under Paragraph 3. Incremental Number of Phantom Stock Units Vested Vesting Date #VestQty_1# #VestDate_1# 3. Termination of Service Prior to Full Vesting. In the event of the Grantee's Termination of Service prior to the vesting of all phantom stock units hereunder, then the consequences of such termination shall be as follows: (a) If the Termination of Service is by reason of death or Disability, then the vesting date for all remaining phantom stock units that have not yet vested shall be accelerated to be the date of such termination. (b) Any unvested phantom stock units that do not become vested under Paragraph (a) above shall be automatically forfeited to the Company. 4. Receipt of Shares of Stock. (a) As soon as practicable following each vesting date, the Company shall direct its transfer agent to issue to the Grantee in book entry form the number of Shares equal to

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2 the number of phantom stock units credited to the Grantee that have vested pursuant to Section 2 of this Agreement on such date in satisfaction of such phantom stock units. (b) In each instance above, the issuance of Shares shall be subject to the payment by the Grantee by cash or other means acceptable to the Company of any federal, state, local and other applicable taxes required to be withheld in connection with such issuance in accordance with Section 6 of this Agreement. 5. Incorporation of Plan. Notwithstanding anything herein to the contrary, this Agreement shall be subject to and governed by all the terms and conditions of the Plan, including the powers of the Committee set forth in Section 2 of the Plan. 6. Tax Withholding. The Grantee shall, not later than the date as of which the receipt of this Award becomes a taxable event, pay to the Company or make arrangements satisfactory to the Committee for payment of taxes required by law to be withheld on account of such taxable event. 7. Miscellaneous. (a) Notice hereunder shall be given to the Company at its principal place of business, and shall be given to the Grantee at the address set forth below, or in either case at such other address as one party may subsequently furnish to the other party in writing. (b) This Agreement does not confer upon the Grantee any rights with respect to continuation of service on the Company's Board of Directors. MERCURY SYSTEMS, INC. By: Steve Ratner Title: Chief Human Resources Officer The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned. Dated: #AcceptanceDate# #ParticipantName# Grantee's Signature

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## Exhibit 10.7

![](a2026annualboardmemberds001.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DEFERRED STOCK UNIT AGREEMENT UNDER THE MERCURY SYSTEMS, INC. 2025 LONG TERM INCENTIVE PLAN Name of Grantee: #ParticipantName# No. of Phantom Stock Units Granted: #QuantityGranted# Grant Date: #GrantDate# Pursuant to the Mercury Systems, Inc. 2025 Long Term Incentive Plan as amended through the date hereof (the "Plan"), Mercury Systems, Inc. (the "Company") hereby grants a deferred stock unit award consisting of the number of phantom stock units listed above (an "Award") to the Grantee named above. Capitalized terms not otherwise defined herein shall have the respective meanings ascribed to them under the Plan. Each phantom stock unit shall relate to one Share of Common Stock of the Company, subject to the restrictions and conditions set forth herein and in the Plan. 1. Restrictions on Transfer of Award. This Agreement and the underlying Award shall be subject to the restrictions on transferability set forth in Section 14(g) of the Plan until (i) the phantom stock units have vested as provided in Section 2 of this Agreement, and (ii) Shares have been issued pursuant to Section 4 of this Agreement. 2. Vesting of Phantom Stock Units. The phantom stock units shall vest in accordance with the schedule set forth below (or if earlier, on the date of the Company's next annual shareholders meeting), subject to the acceleration events provided for under Paragraph 3. Incremental Number of Phantom Stock Units Vested Vesting Date #VestQty_1# #VestDate_1# 3. Termination of Service Prior to Full Vesting. In the event of the Grantee's Termination of Service prior to the vesting of all phantom stock units hereunder, then the consequences of such termination shall be as follows: (a) If the Termination of Service is by reason of death or Disability, then the vesting date for all remaining phantom stock units that have not yet vested shall be accelerated to be the date of such termination. (b) Any unvested phantom stock units that do not become vested under Paragraph (a) above shall be automatically forfeited to the Company. 4. Receipt of Shares of Stock. (a) As soon as practicable following the Grantee's Termination of Service, the Company shall direct its transfer agent to issue to the Grantee in book entry form the number of Shares equal to the number of phantom stock units credited to the Grantee that have vested

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2 pursuant to Section 2 of this Agreement on or prior to the date of such Termination of Service, if any, in satisfaction of such phantom stock units. (b) The issuance of Shares under Paragraph (a) above shall be subject to the payment by the Grantee by cash or other means acceptable to the Company of any federal, state, local and other applicable taxes required to be withheld in connection with such issuance in accordance with Section 6 of this Agreement. 5. Incorporation of Plan. Notwithstanding anything herein to the contrary, this Agreement shall be subject to and governed by all the terms and conditions of the Plan, including the powers of the Committee set forth in Section 2 of the Plan. 6. Tax Withholding. The Grantee shall, not later than the date as of which the receipt of this Award becomes a taxable event, pay to the Company or make arrangements satisfactory to the Committee for payment of taxes required by law to be withheld on account of such taxable event. 7. Miscellaneous. (a) Notice hereunder shall be given to the Company at its principal place of business, and shall be given to the Grantee at the address set forth below, or in either case at such other address as one party may subsequently furnish to the other party in writing. (b) This Agreement does not confer upon the Grantee any rights with respect to continuation of service on the Company's Board of Directors. MERCURY SYSTEMS, INC. By: Steve Ratner Title: Chief Human Resources Officer The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned. Dated: #AcceptanceDate# #ParticipantName# Grantee's Signature

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## Exhibit 10.8

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RESTRICTED STOCK UNIT AGREEMENT UNDER THE MERCURY SYSTEMS, INC. 2025 LONG TERM INCENTIVE PLAN Name of Grantee: #ParticipantName# No. of Phantom Stock Units Granted: #QuantityGranted# Grant Date: #GrantDate# Pursuant to the Mercury Systems, Inc. 2025 Long Term Incentive Plan as amended through the date hereof (the "Plan"), Mercury Systems, Inc. (the "Company") hereby grants a restricted stock unit award consisting of the number of phantom stock units listed above (an "Award") to the Grantee named above. Capitalized terms not otherwise defined herein shall have the respective meanings ascribed to them under the Plan. Each phantom stock unit shall relate to one Share of Common Stock of the Company, subject to the restrictions and conditions set forth herein and in the Plan. 1. Restrictions on Transfer of Award. This Agreement and the underlying Award shall be subject to the restrictions on transferability set forth in Section 14(g) of the Plan until (i) the phantom stock units have vested as provided in Section 2 of this Agreement, and (ii) Shares have been issued pursuant to Section 4 of this Agreement. 2. Vesting of Phantom Stock Units. The phantom stock units shall vest in accordance with the schedule set forth below, subject to the acceleration events provided for under Paragraph 3. Incremental Number of Phantom Stock Units Vested Vesting Date #VestQty_1# #VestDate_1# #VestQty_2# #VestDate_2# #VestQty_3# #VestDate_3# 3. Termination of Service Prior to Full Vesting. In the event of the Grantee's Termination of Service prior to the vesting of all phantom stock units hereunder, then the consequences of such termination shall be as follows: (a) If (i) on or after the Grant Date (and prior to receiving any notice of termination of employment by the Company for any reason), the Grantee provides at least six months' written notice of their termination of employment (the date of termination so indicated on such notice, the "Retirement Date") to their manager with a copy to their local Human Resources Business Partner and to the Company's Chief Human Resources Officer, (ii) as of the date of the Grantee's termination of employment, the Grantee has at least five years of credited employment service with the Company and its Subsidiaries and is at least 60 years of age, (iii) the Grantee's termination of employment is not for Cause, nor has the Grantee performed, or failed to perform, any acts as of the date of termination that with or without notice or the passage of time or both would constitute Cause, and (iv) no later than the date that is 60 days following

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2 the Grantee's termination of employment, the Grantee shall have satisfied the Release Condition (as defined below), then the vesting date of all phantom stock units that would have vested following the Grantee's termination of employment shall be accelerated to the date that is 60 days following the Grantee's termination of employment; provided, that the Company may accelerate the Grantee's Retirement Date in its sole discretion, which accelerated date shall be the date on which the Grantee's employment shall terminate and be deemed to be a voluntary termination of employment by the Grantee under any applicable employment agreement or policy with the Company and its Subsidiaries; provided, further, that in the event of such acceleration, the service and age requirements set forth in clause (ii) above shall be applied without giving effect to any such acceleration, and on a basis that assumes the Grantee would have maintained employment with the Company and its Subsidiaries through the unaccelerated Retirement Date; provided, further, that the Company and the Grantee may mutually agree to extend the Grantee's Retirement Date, in which case the Grantee shall not be required to provide a further notice pursuant to clause (i) above. (b) If the Grantee's Termination of Service is by reason of death or Disability, then the vesting date for all remaining phantom stock units that have not yet vested shall be accelerated to be the date of such termination. (c) Any unvested phantom stock units that do not become vested under Paragraph (a) or (b) above shall be automatically forfeited to the Company. (d) For purposes of this Agreement, the "Release Condition" shall be the Grantee's execution of a general release, which is no longer revocable, of all claims in the form prescribed by the Company in its sole discretion. 4. Receipt of Shares of Stock. (a) As soon as practicable following each vesting date (without giving effect to the acceleration of any such date pursuant to Section 3(a) above), the Company shall direct its transfer agent to issue to the Grantee in book entry form the number of Shares equal to the number of phantom stock units credited to the Grantee that have vested pursuant to Section 2 of this Agreement on such date in satisfaction of such phantom stock units. (b) In each instance above, the issuance of Shares shall be subject to the payment by the Grantee by cash or other means acceptable to the Company of any federal, state, local and other applicable taxes required to be withheld in connection with such issuance in accordance with Section 6 of this Agreement. 5. Incorporation of Plan. Notwithstanding anything herein to the contrary, this Agreement shall be subject to and governed by all the terms and conditions of the Plan, including the powers of the Committee set forth in Section 2 of the Plan. 6. Tax Withholding. The Grantee shall, not later than the date as of which the receipt of this Award becomes a taxable event, pay to the Company or make arrangements satisfactory to the Committee for payment of taxes required by law to be withheld on account of such taxable event.

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3 7. Miscellaneous. (a) Except as otherwise set forth herein, notice hereunder shall be given to the Company at its principal corporate headquarters to the attention of its legal department, and shall be given to the Grantee at their address on file with the Company's stock plan administrator. (b) This Agreement does not confer upon the Grantee any rights with respect to continuation of employment or service with the Company or any Subsidiary. MERCURY SYSTEMS, INC. By: Steve Ratner Title: Chief Human Resources Officer The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned. Dated: #AcceptanceDate# #ParticipantName# Grantee's Signature

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## Exhibit 10.9

![](a2026dcmpmatchingawardsd001.jpg)

DEFERRED STOCK UNIT AGREEMENT UNDER THE MERCURY SYSTEMS, INC. 2025 LONG TERM INCENTIVE PLAN Name of Grantee: #ParticipantName# No. of Phantom Stock Units Granted: #QuantityGranted# Grant Date: #GrantDate# Pursuant to the Mercury Systems, Inc. 2025 Long Term Incentive Plan as amended through the date hereof (the "Plan"), Mercury Systems, Inc. (the "Company") hereby grants a deferred stock unit award (an "Award") consisting of the number of phantom stock units listed above (the "Units") to the Grantee named above (the "Grantee") in connection with the Grantee's enrollment in and election to defer compensation under the Company's Deferred Compensation Matching Plan (the "DCMP") for the [2026] calendar year (the "Plan Year"). Capitalized terms not otherwise defined herein shall have the respective meanings ascribed to them under the Plan. Each Unit shall relate to one Share of Common Stock of the Company, subject to the restrictions and conditions set forth herein and in the Plan. 1. Restrictions on Transfer of Award. This Agreement and the underlying Award shall be subject to the restrictions on transferability set forth in Section 14(g) of the Plan until (i) the Units have vested as provided in Section 2 of this Agreement, and (ii) Shares have been issued pursuant to Section 4 of this Agreement. 2. Vesting of Units. The Units shall be fully vested as of the Grant Date set forth above. 3. Settlement of Units in Stock. (a) The Units shall be converted into Shares and distributed to the Grantee on such dates (each, a "Distribution Date") and in such increments (as applied to the Units with respect to each Distribution Date, the "Distributed Units") as are applicable for the distribution of compensation deferrals made by the Grantee to the DCMP for the Plan Year. (b) On or as promptly as practicable following each Distribution Date, the Company shall direct its transfer agent to issue to the Grantee in book entry form the number of Shares equal to the number of Distributed Units, in satisfaction of such Units. (c) The issuance of Shares under Paragraph (b) above shall be subject to the payment by the Grantee by cash or other means acceptable to the Company of any federal, state, local and other applicable taxes required to be withheld in connection with such issuance in accordance with Section 5 of this Agreement. 4. Incorporation of Plan. Notwithstanding anything herein to the contrary, this Agreement shall be subject to and governed by all the terms and conditions of the Plan, including the powers of the Committee set forth in Section 2 of the Plan.

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2 5. Tax Withholding. The Grantee shall, not later than the date as of which the receipt of this Award becomes a taxable event, pay to the Company or make arrangements satisfactory to the Committee for payment of taxes required by law to be withheld on account of such taxable event. 6. Miscellaneous. (a) Notice hereunder shall be given to the Company at its principal corporate headquarters to the attention of its legal department, and shall be given to the Grantee at their address on file with the Company's stock plan administrator. (b) This Agreement does not confer upon the Grantee any rights with respect to continuation of employment or service with the Company or any Subsidiary. MERCURY SYSTEMS, INC. By: Steve Ratner Title: Chief Human Resources Officer The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned. Dated: #AcceptanceDate# #ParticipantName# Grantee's Signature

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## Exhibit 31.1

**EXHIBIT 31.1**

**CERTIFICATION**

I, William L. Ballhaus, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.I have reviewed this quarterly report on Form 10-Q of Mercury Systems, Inc.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 4, 2025

---

| |
|:---|
| /S/&nbsp;&nbsp;&nbsp;&nbsp;WILLIAM L. BALLHAUS&nbsp;&nbsp;&nbsp;&nbsp;  |
| **William L. Ballhaus** |
| **CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER<br>[PRINCIPAL EXECUTIVE OFFICER]** |

---

## Exhibit 31.2

**EXHIBIT 31.2**

**CERTIFICATION**

I, David E. Farnsworth, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.I have reviewed this quarterly report on Form 10-Q of Mercury Systems, Inc.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 4, 2025

---

| |
|:---|
| /S/ DAVID E. FARNSWORTH |
| **David E. Farnsworth** |
| **EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER** |
| **[PRINCIPAL FINANCIAL OFFICER]** |

---

## Exhibit 32.1

**EXHIBIT 32.1**

Mercury Systems, Inc.

Certification Pursuant To

18 U.S.C. Section 1350,

As Adopted Pursuant To

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Mercury Systems, Inc. (the "Company") on Form 10-Q for the period ended September 26, 2025 as filed with the Securities and Exchange Commission (the "Report"), we, William L. Ballhaus, President and Chief Executive Officer of the Company, and David E. Farnsworth, Executive Vice President, Chief Financial Officer of the Company, certify, pursuant to Section 1350 of Chapter 63 of Title 18, United States Code, that to our knowledge the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 4, 2025

---

| |
|:---|
| /S/&nbsp;&nbsp;&nbsp;&nbsp;WILLIAM L. BALLHAUS&nbsp;&nbsp;&nbsp;&nbsp;  |
| **William L. Ballhaus** |
| **CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER** |
| /S/&nbsp;&nbsp;&nbsp;&nbsp;DAVID E. FARNSWORTH |
| **David E. Farnsworth** |
| **EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER** |

---

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