A Member of Pat McKeough’s Inner Circle recently asked for his advice on an advanced engineering and technology solutions provider that delivers mission-critical environmental, digital, and systems engineering services to the U.S. government and allied nations.
Pat likes the highly visible contract backlog and robust business development momentum. This predictable revenue stream is heavily supported by government demand in high-growth sectors. Furthermore, management is demonstrating strong operational execution and a clear path to margin expansion. However, Pat notes the business is heavily concentrated in U.S. government contracts and this carries risk—as does its high debt..
Amentum Holdings (Symbol AMTM on NYSE; www.amentum.com) is a provider of advanced engineering and technology solutions, primarily serving the U.S. government and its allied nations.
The company was spun off by AECOM in 2020, then combined with segments of Jacobs Solutions in 2023. It then opted for a listing on the U.S. public market in 2024. Its current headquarters are in Chantilly, Virginia.
Amentum offers a broad range of capabilities, including environmental remediation (cleanup), space systems, critical digital infrastructure, and nuclear energy reactor technologies.
The company operates in 70 countries across all 7 continents and employs 50,000. In 2025, about 80% of revenue came from contracts with the U.S. government.
Amentum operates its business activities, and reports financial results, through two segments:
Digital Solutions: This segment provides advanced digital and data-driven solutions, including intelligence analytics, space system development, cybersecurity, and next-generation IT, across federal government and commercial clients. In the 2025 fiscal year (ending 30 September), this unit provided 38% of the company’s revenues.
Global Engineering Solutions: This segment provides environmental remediation, nuclear power solutions, platform engineering, and supply chain management for the U.S. government and allied nations. In the 2025 fiscal year, this unit provided 62% of the company’s revenues.
Amentum continues to win contracts:
On November 12, 2025, the company announced the award of a major Remotely Piloted Aircraft Maintenance Support contract with the U.S. Air Force Air Combat Command. The agreement is valued at up to $995 million.
On December 9, 2025, Amentum announced the award of a $120 million computer processing award from the U.S. Defense Information Systems Agency (DISA). Under the contract, Amentum will provide and maintain all hardware, software, licensing, and operational services with the support of DISA.
On January 22, 2026, the company announced that a consortium, which it leads, has won a $207-million contract to provide program management and technical solutions for the planning and development of nuclear plants in the Netherlands.
On January 27, 2026, Amentum announced the award of a suite of new contracts from Électricité de France, worth up to $730 million, to support the development and life extension of the U.K.’s new and existing power stations.
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Amentum’s huge surge in quarterly profitability
In the three months ended July 3, 2026, Amentum reported revenue of $3.49 billion, down 2.0% from $3.56 billion a year earlier. Revenue fell due to contract transitions and divestitures.
Excluding one-time items, earnings amounted to $0.67 a share, which was up 20% from $0.56 a share a year earlier, mostly due to lower interest expenses and higher operational profitability.
Amentum’s order backlog at the end of the quarter was $48.2 billion, 8.0% higher than a year earlier.
The company’s long-term debt of $3.8 billion is a high 77.6% of its market cap, which adds risk. It holds cash of $459 million.
All in all, the outlook for the new Amentum is sound as it keeps winning new contracts in engineering, digital, cybersecurity, nuclear, and space work, which generally carries higher profit margins than traditional labour-intensive government services.
Recommendation in Pat’s Inner Circle: Amentum Holdings is okay to hold.
