Shares of Science Applications International Corp. (SAIC (SAIC)) jumped more than 17% on Monday, hitting a fresh 52-week high after the government services contractor delivered fiscal first-quarter 2027 results that left Wall Street estimates in the dust. The company also raised its full-year profit outlook, giving investors plenty to cheer about.

“I am proud of our team’s performance this quarter, delivering record margin and modest organic growth,” said CEO Jim Reagan. That modest growth? Revenue rose 2% year over year to $1.91 billion, topping the analyst consensus of $1.82 billion. Adjusted earnings per share came in at $3.23, well above the $2.29 analysts were expecting. That's a beat of more than 40%.

SAIC, which provides technical, engineering, and enterprise IT services to defense, intelligence, civilian, and space customers, also showed off some serious profitability improvements. Operating income jumped 48% to $179 million, and operating margin expanded 300 basis points to 9.4%. Adjusted operating income rose 40% to $221 million, pushing the adjusted operating margin up 320 basis points to 11.6%. Adjusted EBITDA climbed 41% to $222 million, with the margin also improving 320 basis points to 11.6%.

The company's net bookings totaled about $2.1 billion, giving it a book-to-bill ratio of 1.1—meaning it's bringing in more business than it's delivering. Operating cash flow was $127 million, and free cash flow hit $118 million. SAIC ended the quarter with an estimated backlog of $22.9 billion, including $3.7 billion of funded backlog. Cash and cash equivalents stood at $109 million as of May 1.

Reagan said the company is focused on rebuilding investor confidence through sustained organic growth while maintaining strong margins and cash generation. Part of that strategy involves reshaping SAIC's portfolio toward mission-critical capabilities that align with government spending priorities—and away from more commoditized enterprise IT markets. The company's qualified pipeline has grown to approximately $85 billion, with increasing exposure to mission and engineering programs.

Artificial intelligence and mission modernization are key growth drivers. Reagan said SAIC is helping government agencies establish data standards, develop multimodal AI capabilities, and build secure environments for sensitive missions. The company is also applying AI to legacy code modernization, operational planning, cybersecurity, and human-machine teaming.

CFO Prabu Natarajan noted that funding is beginning to flow into several defense initiatives, including Navy programs, next-generation command-and-control systems, loitering munitions, Army air-defense programs, radar modernization efforts, and space-related projects. He also highlighted opportunities in the civilian market, such as the U.S. Department of State’s Evolve contract vehicle, which has a ceiling value of $10 billion over seven years.

Looking ahead, SAIC raised its fiscal 2027 adjusted EPS outlook to a range of $9.90 to $10.10, up from a prior forecast of $9.50 to $9.70. That new guidance easily exceeds the analyst consensus estimate of $9.63. The company affirmed its fiscal 2027 revenue guidance of $7 billion to $7.2 billion, compared with analyst expectations of $7.15 billion. SAIC also increased its adjusted EBITDA forecast to $720 million-$730 million from $705 million-$715 million and affirmed its expectation for free cash flow of more than $600 million.

As of publication Monday, SAIC shares were up 17.87% at $122.82, trading at a new 52-week high. The market is clearly buying what the company is selling—both in terms of government contracts and financial results.