CACI International’s long-standing pursuit of more product content has never been about building the kind of platforms and systems produced by the blue-chip defense hardware companies.

The potential seven-year, $1.2 billion contract with the Navy called Spectral, which CACI secured in June, is another important sign of how the company is taking a software-centric approach to technology, especially when it comes to hardware.

During CACI’s fourth-quarter and fiscal year earnings call with investors on Thursday, CEO John Mengucci described Spectral primarily as a company that performs “under the hood software processing” to help operators detect threats and signals.

Spectral will most likely enter the initial low-rate production phase in the third quarter of CACI’s new fiscal year, which began July 1, Mengucci said. CACI is working with the Navy to develop and field new systems for shipboard signals intelligence, electronic warfare and information operations.

The Navy is also taking an open architecture and continuous software update approach to this program, and this is where the ongoing government market discussion about collaboration comes into play.

CACI’s teammates for Spectral are Northrop Grumman, Raytheon Technologies, BAE Systems, Sierra Nevada Corporation and Dell Technologies. These are three blue-chip defense hardware manufacturers, followed by one of the largest private space companies and a global commercial technology company.

As with any team collaboration, CACI has designed the partnership with Spectral to allow the company to focus on its core offering while engaging others who have something different to offer.

“When we looked at the software and the teamwork, we partnered with Northrop and Raytheon, a tremendous team that is a great complement to our Spectral offering because they have expertise in areas that we don’t have,” Mengucci told analysts. “That’s what our customers expect from us: to lead with software, lead with agility, partner with partners that can deliver the other pieces that we don’t deliver, and then give them an experience and a set of results that are absolutely stunning.”

Being a leader with software means being able to make changes quickly and stay on schedule for the upcoming LRIP phase of the program, Mengucci said. LRIP is typically the first step in moving from initial prototypes to the final, mass-produced end product manufactured under various contracts.

How could CACI, headquartered in Reston, Virginia, look for opportunities to win larger programs that would normally go to the group of companies known as “the prime sponsors”?

“These are phenomenal companies. They’re all building amazing platforms, and we should be proud of everything these companies are doing,” Mengucci told analysts. “We just believe there’s a mission here that we can accomplish in a more agile way, in a way that enables customers to address threats at the speed of battle.”

Revenue for the fourth fiscal quarter was $2 billion, up 19.7% year-over-year. Organic growth was 18.5%, while earnings of $234.9 million represented a 26.5% increase in EBITDA (earnings before interest, taxes, depreciation and amortization) over the same period last year.

Revenue for the full fiscal year was $7.6 billion, up 14.3% from the same period last year. Organic growth was 13.7%, while EBITDA was $798 million, up 11.5% year-on-year.

CACI’s initial outlook for the 2025 fiscal year, which began on July 1, assumes revenue in the range of $7.9 billion to $8.1 billion with an EBITDA margin in the “high 10 percent range.”

Total backlog was $31.6 billion as of June 30, 2024, an increase of 22% year over year. Funded backlog was $3.8 billion as of the same date, an increase of 3%.