KBR, INC.KBR
KBR, INC. Revenue Disclosure
Revenue
Disaggregated Revenue
We disaggregate our revenue from customers by business unit, customer type, geographic destination and contract type for each of our segments, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.
Revenue by business unit and reportable segment was as follows:
| Year ended | |||||||||||||||||
| Dollars in millions | January 2, 2026 | January 3, 2025 | December 29, 2023 | ||||||||||||||
| Mission Technology Solutions | |||||||||||||||||
| Science & Space | $ | 1,126 | $ | 1,188 | $ | 1,127 | |||||||||||
| Defense & Intel | 3,178 | 2,887 | 2,497 | ||||||||||||||
| Readiness & Sustainment | 1,277 | 1,480 | 1,495 | ||||||||||||||
| Total Mission Technology Solutions | $ | 5,581 | $ | 5,555 | $ | 5,119 | |||||||||||
| Sustainable Technology Solutions | $ | 2,205 | $ | 2,155 | $ | 1,837 | |||||||||||
| Total revenue | $ | 7,786 | $ | 7,710 | $ | 6,956 | |||||||||||
Revenue by customer type was as follows:
| Year ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| January 2, 2026 | January 3, 2025 | December 29, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Dollars in millions | MTS | STS | Total | MTS | STS | Total | MTS | STS | Total | ||||||||||||||||||||||||||||||||||||||||||||
| U.S. Government Defense and Intelligence Clients | $ | 3,370 | $ | — | $ | 3,370 | $ | 3,292 | $ | — | $ | 3,292 | $ | 3,039 | $ | — | $ | 3,039 | |||||||||||||||||||||||||||||||||||
| U.S. Government Federal Civilian Clients | 1,057 | — | 1,057 | 1,112 | — | 1,112 | 1,052 | — | 1,052 | ||||||||||||||||||||||||||||||||||||||||||||
| International Government Clients | 905 | — | 905 | 891 | — | 891 | 791 | — | 791 | ||||||||||||||||||||||||||||||||||||||||||||
| Commercial and Infrastructure Clients | 249 | 2,205 | 2,454 | 260 | 2,155 | 2,415 | 237 | 1,837 | 2,074 | ||||||||||||||||||||||||||||||||||||||||||||
| Total revenue | $ | 5,581 | $ | 2,205 | $ | 7,786 | $ | 5,555 | $ | 2,155 | $ | 7,710 | $ | 5,119 | $ | 1,837 | $ | 6,956 | |||||||||||||||||||||||||||||||||||
Revenue by geographic destination was as follows:
| Year ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Dollars in millions | January 2, 2026 | January 3, 2025 | December 29, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Total by Countries/Regions | MTS | STS | Total | MTS | STS | Total | MTS | STS | Total | ||||||||||||||||||||||||||||||||||||||||||||
| United States | $ | 3,772 | $ | 472 | $ | 4,244 | $ | 3,503 | $ | 542 | $ | 4,045 | $ | 3,096 | $ | 521 | $ | 3,617 | |||||||||||||||||||||||||||||||||||
| Europe | 1,313 | 271 | 1,584 | 1,595 | 299 | 1,894 | 1,569 | 247 | 1,816 | ||||||||||||||||||||||||||||||||||||||||||||
| Middle East | 123 | 667 | 790 | 110 | 621 | 731 | 105 | 423 | 528 | ||||||||||||||||||||||||||||||||||||||||||||
| Australia | 219 | 329 | 548 | 202 | 324 | 526 | 204 | 292 | 496 | ||||||||||||||||||||||||||||||||||||||||||||
| Africa | 77 | 176 | 253 | 70 | 131 | 201 | 70 | 106 | 176 | ||||||||||||||||||||||||||||||||||||||||||||
| Asia | 20 | 122 | 142 | 18 | 134 | 152 | 17 | 152 | 169 | ||||||||||||||||||||||||||||||||||||||||||||
| Other countries | 57 | 168 | 225 | 57 | 104 | 161 | 58 | 96 | 154 | ||||||||||||||||||||||||||||||||||||||||||||
| Total revenue | $ | 5,581 | $ | 2,205 | $ | 7,786 | $ | 5,555 | $ | 2,155 | $ | 7,710 | $ | 5,119 | $ | 1,837 | $ | 6,956 | |||||||||||||||||||||||||||||||||||
Many of our contracts contain cost reimbursable, time-and-materials and fixed price (including unit-rate) components. We define contract type based on the component that represents the majority of the contract. Revenue by contract type was as follows:
| Year ended January 2, 2026 | Year ended January 3, 2025 | Year ended December 29, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Dollars in millions | MTS | STS | Total | MTS | STS | Total | MTS | STS | Total | ||||||||||||||||||||||||||||||||||||||||||||
| Cost-Reimbursable | $ | 3,305 | $ | — | $ | 3,305 | $ | 3,507 | $ | — | $ | 3,507 | $ | 3,287 | $ | — | $ | 3,287 | |||||||||||||||||||||||||||||||||||
| Time-and-Materials | 938 | 1,373 | 2,311 | 892 | 1,362 | 2,254 | 846 | 1,166 | 2,012 | ||||||||||||||||||||||||||||||||||||||||||||
| Fixed Price | 1,338 | 832 | 2,170 | 1,156 | 793 | 1,949 | 986 | 671 | 1,657 | ||||||||||||||||||||||||||||||||||||||||||||
| Total revenue | $ | 5,581 | $ | 2,205 | $ | 7,786 | $ | 5,555 | $ | 2,155 | $ | 7,710 | $ | 5,119 | $ | 1,837 | $ | 6,956 | |||||||||||||||||||||||||||||||||||
Performance Obligations
Changes in estimates are recognized on a cumulative catch-up basis in the current period associated with performance obligations satisfied in a prior period due to the release of a constrained milestone, modification in contract price or scope or a change in the likelihood of a contingency or claim being resolved. We recognized revenue from performance obligations satisfied in previous periods for such matters of $48 million, $30 million and $15 million for the years ended January 2, 2026, January 3, 2025 and December 29, 2023, respectively.
On January 2, 2026, we had $13.3 billion of transaction price allocated to remaining performance obligations. We expect to recognize approximately 36% of our remaining performance obligations as revenue within one year, 41% in years two through five and 23% thereafter. Revenue associated with our remaining performance obligations to be recognized beyond one year includes performance obligations primarily related to the Aspire Defence project, which has contract terms extending through 2041. Remaining performance obligations do not include variable consideration that was determined to be constrained as of January 2, 2026.
Changes in Project-related Estimates
There are many factors that may affect the accuracy of our cost estimates and ultimately our future profitability. These include, but are not limited to, the availability and costs of resources (such as labor, materials and equipment), productivity, weather and ongoing resolution of commercial and legal matters, including any new or ongoing disputes with our business partners and others in our supply chain. We recognize revisions of revenues, costs and equity in earnings in the period in which the revisions are known. This may result in the recognition of costs before the recognition of related revenue recovery, if any. During fiscal 2025, we recognized a favorable change in operating income of $134 million as a result of changes in estimates on an LNG project.
Contract Assets and Contract Liabilities
Contract assets were $280 million and $271 million and contract liabilities were $331 million and $328 million, at January 2, 2026 and January 3, 2025, respectively. The increase in contract assets was primarily attributed to revenue recognized on certain contracts partially offset by the timing of billings. The increase in contract liabilities was due to the timing of advance payments and revenue recognized during the period. We recognized revenue of $233 million for the year ended January 2, 2026, which was previously included in the contract liability balance at January 3, 2025.
Accounts Receivable
| Dollars in millions | January 2, 2026 | January 3, 2025 | |||||||||
| Unbilled | $ | 520 | $ | 525 | |||||||
| Trade & other | 566 | 541 | |||||||||
| Accounts receivable, net | $ | 1,086 | $ | 1,066 | |||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | Feb 26, 2026 | Showing above |
| 2025 | Feb 25, 2025 | |
| 2023 | Feb 20, 2024 | |
| 2022 | Feb 17, 2023 | |
| 2021 | Feb 22, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 24, 2020 | |
| 2018 | Feb 26, 2019 | |
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.