Castellum Announces Third Quarter 2026 Financial Results

Glen Ives, President and Chief Executive Officer of Castellum

“While third quarter revenue increased slightly year-over-year, revenue for the first nine months of 2026 grew 6%, reflecting continued execution on the major long-term prime contracts we secured in 2025. While the timing of contract awards, program ramp-ups and revenue recognition can cause quarterly fluctuations, we believe our year-to-date performance and expanding business opportunities provide a clearer measure of our overall trajectory.”

Glen Ives, President and Chief Executive Officer of Castellum

“We ended the third quarter with a total scheduled backlog of $254.5 million and expect to recognize approximately 25% and 51% of the remaining performance obligations within the next 12 and 24 months, respectively. During the quarter, we also refined our backlog reporting by including priced contract options, previously reported separately, within unfunded backlog. This change provides a clearer view of our contracted business and aligns our reporting with industry standards.”

Glen Ives, President and Chief Executive Officer of Castellum

“Our qualified opportunity pipeline grew to approximately $1.66 billion, up from $953.5 million at the end of the second quarter, expanding the range of potential contracts we are pursuing. Together, our backlog and pipeline provide a foundation for future revenue and opportunities for additional growth as we work to convert qualified opportunities into contract awards.”

David Bell, Chief Financial Officer of Castellum

“Revenue for the first nine months of 2026 increased to $42.9 million from $40.3 million a year ago, while gross profit remained relatively flat at $15.1 million. A higher mix of subcontractor work, which typically carries lower margins than direct labor, limited gross profit growth. Adjusted EBITDA declined to approximately $1.0 million from $1.8 million in the prior-year period, but this was anticipated. As part of our 2026 growth strategy, we have deliberately increased spending in areas we believe will drive future growth, particularly business development and M&A activities. The near-term impact on Adjusted EBITDA is consistent with what we expected when we began implementing this strategy.”

David Bell, Chief Financial Officer of Castellum

“As previously discussed, this year we built out our business development team to pursue contract opportunities, while also committing our resources to identify and evaluate potential acquisitions. These initiatives require significant spending today, well before the associated revenue and earnings opportunities can be realized. While we have the financial capacity to invest more aggressively, we are taking a purposely measured approach, balancing our growth objectives with careful expense management and preserving the flexibility to act when the right opportunities arise. We believe these investments are important stepping-stones and create the foundation needed to scale our business.”

David Bell, Chief Financial Officer of Castellum

“It’s also important to look at our GAAP net loss in the context of the non-cash expenses included in our results. Despite the reported net loss, we remain Adjusted EBITDA positive and generated $1.1 million in operating cash flow through the first nine months of 2026, compared with $1.3 million used in the prior-year period. In addition, our combined cash and accounts receivable balance has increased by an average of $0.5 million per quarter this year, even as we continued to invest in business development and M&A. We ended the period with $15.7 million in cash, $24.5 million in cash and accounts receivable combined, and no outstanding debt, a strong financial position which provides us with the means to execute our organic and inorganic growth strategies.”

Glen Ives, President and Chief Executive Officer of Castellum

“We remain focused on delivering record annual revenue in 2026 and continuing to grow our existing business through new contract awards, expansion of current programs and improved execution. Our investments in business development are strengthening our ability to compete for larger opportunities as reflected in our substantial pipeline of potential new business.”

Glen Ives, President and Chief Executive Officer of Castellum

“However, we believe acquisitions offer the greatest opportunity to take Castellum to the next level. M&A has always been a major priority of our strategy, and we've invested additional time and resources this year to expand our search and pursue the right opportunities. We're actively evaluating businesses that compliment what we do, add new capabilities and customer relationships, and can contribute meaningful revenue and earnings. We also recognize that finding the right, strategic business is only part of the equation. Cultural fit, financial discipline and a clear path to successful integration are all key considerations as we evaluate potential acquisitions. Our strong balance sheet allows us to pursue this strategy from a position of financial flexibility, but we intend to be selective in how we deploy our resources.”

Glen Ives, President and Chief Executive Officer of Castellum

“In summary, we believe disciplined acquisitions offer the strongest path to building scale and profitability. We remain focused on expanding our existing contracts while completing acquisitions that complement our capabilities and provide additional avenues for growth. Both are important to our strategy, but we see M&A as our principal opportunity to accelerate long-term growth and create shareholder value, especially in the coming 6 to 12 months.”