mms-20251231

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark one)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________to__________.

Commission file number: 1-12997


Maximus, Inc.
(Exact name of registrant as specified in its charter)

Virginia						54-1000588
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

1600 Tysons Boulevard, McLean, Virginia						22102
(Address of principal executive offices)						(Zip Code)

(703) 251-8500
(Registrant's telephone number, including the area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, no par value

MMS

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒

Accelerated filer ☐

Non-accelerated filer ☐

Smaller reporting company ☐

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

There were 54,548,576 shares of the registrant's Common Stock outstanding as of February 2, 2026.

Table of Contents

Table of Contents to First Quarter 2026 Form 10-Q


	SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS	3
Part I - Financial Information		5
Item 1.	Financial Statements	5
	Consolidated Statements of Operations	5
	Consolidated Statements of Comprehensive Income	6
	Consolidated Balance Sheets	7
	Consolidated Statements of Cash Flows	8
	Consolidated Statements of Changes in Shareholders’ Equity	9
	Notes to Consolidated Financial Statements	10
	1. Organization	10
	2. Significant Accounting Policies	10
	3. Business Segments	11
	4. Revenue Recognition	13
	5. Earnings Per Share	15
	6. Divestitures	15
	7. Debt and Derivatives	16
	8. Fair Value Measurements	17
	9. Equity	18
	10. Other Items	19
	11. Commitments and Contingencies	20
	12. Subsequent Event	21
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	22
	Business Overview	22
	Financial Overview	23
	Results of Operations	23
	Liquidity and Capital Resources	28
	Critical Accounting Policies and Estimates	31
	Non-GAAP and Other Measures	31
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4.	Controls and Procedures	33
Part II - Other Information		34
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3.	Defaults Upon Senior Securities	34
Item 4.	Mine Safety Disclosures	34
Item 5.	Other Information	34
Item 6.	Exhibits	35
	Signatures	36

Table of Contents

Unless otherwise specified, references in this Quarterly Report on Form 10-Q to "our," "we," "us," "Maximus," the "Company," and "our business" refer to Maximus, Inc. and its subsidiaries.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Included in this Quarterly Report on Form 10-Q are forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: "anticipate," "intend," "plan," "goal," "seek," “on track,” "opportunity," "could," "potential," "believe," "project," "estimate," "expect," "continue," "forecast," "strategy," "future," "likely," "may," "should," "will," and similar references to future periods.

Any statements herein that are not historical facts, including statements about our confidence, strategies and initiatives, and our expectations about revenues, results of operations, profitability, future contracts, liquidity, market opportunities, market demand, acceptance of our products, or acquisitions and divestitures, are forward-looking statements that are subject to risks and uncertainties. These risks could cause our actual results to differ materially from those indicated by such forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following:

•a failure to meet performance requirements under our contracts could lead to penalties, liquidated damages, actual damages, adverse settlement agreements, and/or contract termination;

•our ability to successfully compete, bid for, and accurately price contracts to generate our desired profit;

•the effects of future legislative or government budgetary and spending changes, including the impact of a prolonged U.S. government shutdown;

•the impact of the U.S. government on federal procurement, federal funding to states' safety-net programs, and the overall decision-making process related to our industry, including our business and customers;

•the ability of the U.S. government to issue or revise existing rules, regulations, executive orders, and directives at any time, or to take non-routine actions, which creates uncertainty for our business operations and requires significant additional compliance efforts and costs;

•our ability to manage our growth, including acquired businesses;

•difficulties in integrating or achieving projected revenues, earnings, and other benefits associated with acquired businesses;

•the outcome of reviews or audits, which might result in financial penalties and impair our ability to respond to invitations for new work;

•our ability to manage capital investments and other contract startup costs;

•our ability to manage our debt;

•our ability to maintain our technology systems and otherwise protect confidential or protected information;

•our discovery of additional information related to our previously disclosed cybersecurity incident and any potential legal, business, reputational, or financial consequences resulting from that incident;

•our ability to attract and retain executive officers, senior managers, and other qualified personnel to execute our business;

•the effect of union activity and organizing efforts at our U.S. locations;

•the ability of government customers to not exercise options, or to recompete or terminate contracts on short notice, with or without cause;

•our ability to win recompetes and/or succeed in protests on our significant contracts;

•our reliance on a small number of individual contracts and customers;

•our ability to realize the full value of our backlog;

•our ability to maintain relationships with key government entities from whom a substantial portion of our revenue is derived;

•a failure to comply with laws governing our business, which might result in the Company being subject to fines, penalties, suspension, debarment, and other sanctions;

•the costs and outcome of litigation;

•our ability to manage third parties upon whom we depend to provide services to our customers;

•the effects of changes in laws and regulations governing our business, including actions resulting from non-routine government actions or orders, changes in tax laws and applicable interpretations and guidance thereunder, or changes in accounting policies, rules, methodologies, and practices, and our ability to estimate the impact of such changes including shifting macroeconomic conditions and uncertainty;

Table of Contents

•the effects of emerging technologies, such as artificial intelligence (AI) and machine learning (ML), on our business;

•matters related to businesses we disposed of or divested; and

•other factors set forth in Item 1A, "Risk Factors" of our Annual Report on Form 10-K, filed with the Securities and Exchange Commission (SEC) on November 20, 2025.

Any forward-looking statement made by us in this report is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments, or otherwise.

Table of Contents

PART I - Financial Information

Item 1. Financial Statements

Maximus, Inc.

Consolidated Statements of Operations

(Unaudited)


	For the Three Months Ended
	December 31, 2025		December 31, 2024
	(in thousands, except per share amounts)
Revenue	$	1,345,046	$	1,402,675
Cost of revenue	1,026,376		1,101,118
Gross profit	318,670		301,557
Selling, general, and administrative expenses	152,160		191,735
Amortization of intangible assets	20,300		23,035
Operating income	146,210		86,787
Interest expense	20,816		17,522
Other (income)/expense, net	(873)		312
Income before income taxes	126,267		68,953
Provision for income taxes	32,324		27,757
Net income	$	93,943	$	41,196

Earnings per share:
Basic	$	1.71	$	0.69
Diluted	$	1.70	$	0.69
Weighted average shares outstanding:
Basic	54,842		59,733
Diluted	55,299		60,002

Dividends declared per share	$	0.30	$	0.30

See accompanying notes to consolidated financial statements.

Table of Contents

Maximus, Inc.

Consolidated Statements of Comprehensive Income

(Unaudited)


	For the Three Months Ended
	December 31, 2025		December 31, 2024
	(in thousands)
Net income	$	93,943	$	41,196
Other comprehensive income, net of tax:
Foreign currency translation adjustments	248		10,452
Net (losses)/gains on cash flow hedges, net of tax (benefit)/provision of $(502) and $876, respectively	(1,407)		2,454
Other comprehensive (loss)/income	(1,159)		12,906
Comprehensive income	$	92,784	$	54,102

See accompanying notes to consolidated financial statements.

Table of Contents

Maximus, Inc.

Consolidated Balance Sheets


	December 31, 2025		September 30, 2025
	(unaudited)
	(in thousands)
Assets:
Cash and cash equivalents	$	137,594	$	222,351
Accounts receivable, net	1,147,740		898,095
Income taxes receivable	5,305		3,904
Prepaid expenses and other current assets	132,569		128,574
Total current assets	1,423,208		1,252,924
Property and equipment, net	28,108		30,972
Capitalized software, net	210,503		214,260
Operating lease right-of-use assets	93,724		100,514
Goodwill	1,781,156		1,782,095
Intangible assets, net	517,916		538,266
Deferred contract costs, net	66,636		63,332
Deferred compensation plan assets	65,109		63,272
Deferred income taxes	11,755		11,491
Other assets	10,185		12,513
Total assets	$	4,208,300	$	4,069,639
Liabilities and Shareholders' Equity:
Liabilities:
Accounts payable and accrued liabilities	$	263,281	$	296,888
Accrued compensation and benefits	125,464		236,948
Deferred revenue, current portion	46,566		53,784
Income taxes payable	17,753		17,321
Long-term debt, current portion	58,305		52,680
Operating lease liabilities, current portion	37,484		38,605
Other current liabilities	59,193		68,937
Total current liabilities	608,046		765,163
Deferred revenue, non-current portion	39,958		43,757
Deferred income taxes	176,521		149,020
Long-term debt, non-current portion	1,509,205		1,281,593
Deferred compensation plan liabilities, non-current portion	67,447		62,145
Operating lease liabilities, non-current portion	65,268		71,289
Other liabilities	22,043		22,637
Total liabilities	2,488,488		2,395,604
Commitments and contingencies (Note 11)
Shareholders' equity:
Common stock, no par value; 100,000 shares authorized; 54,549 and 54,805 shares issued and outstanding as of December 31, 2025 and September 30, 2025, respectively	628,867		628,118
Accumulated other comprehensive loss	(19,026)		(17,867)
Retained earnings	1,109,971		1,063,784
Total shareholders' equity	1,719,812		1,674,035
Total liabilities and shareholders' equity	$	4,208,300	$	4,069,639

See accompanying notes to consolidated financial statements.

Table of Contents

Maximus, Inc.

Consolidated Statements of Cash Flows

(Unaudited)


	For the Three Months Ended
	December 31, 2025		December 31, 2024
	(in thousands)
Cash flows from operating activities:
Net income	$	93,943	$	41,196
Adjustments to reconcile net income to cash flows from operations:
Depreciation and amortization of property, equipment, and capitalized software	12,889		8,455
Amortization of intangible assets	20,300		23,035
Amortization of debt issuance costs and debt discount	736		638


Deferred income taxes	27,864		2,157
Stock compensation expense	7,019		6,952
Divestiture-related (gains)/charges	(8,985)		38,341
Change in assets and liabilities, net of effects of business combinations and divestitures:
Accounts receivable	(253,375)		(103,454)
Prepaid expenses and other current assets	(91)		(2,500)
Deferred contract costs	(3,302)		(366)
Accounts payable and accrued liabilities	(33,807)		(8,150)
Accrued compensation and benefits	(100,700)		(93,036)
Deferred revenue	(10,843)		(8,232)
Income taxes	(1,035)		12,076
Operating lease right-of-use assets and liabilities	(399)		(2,349)

Other assets and liabilities	5,384		5,241
Net cash used in operating activities	(244,402)		(79,996)
Cash flows from investing activities:
Purchases of property and equipment and capitalized software	(6,263)		(22,992)

Proceeds from divestitures	12,895		736

Net cash provided by/(used in) investing activities	6,632		(22,256)
Cash flows from financing activities:
Cash dividends paid to Maximus shareholders	(16,338)		(18,060)
Purchases of Maximus common stock	(40,562)		(228,593)
Tax withholding related to RSU vesting	(17,325)		(16,441)


Proceeds from borrowings	365,000		435,000
Principal payments for debt	(132,500)		(179,264)
Other	(1,375)		(899)
Net cash provided by/(used in) financing activities	156,900		(8,257)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	(64)		(2,384)
Net change in cash, cash equivalents, and restricted cash	(80,934)		(112,893)
Cash, cash equivalents, and restricted cash, beginning of period	260,459		235,763
Cash, cash equivalents, and restricted cash, end of period	$	179,525	$	122,870

See accompanying notes to consolidated financial statements.

Table of Contents

Maximus, Inc.

Consolidated Statements of Changes in Shareholders' Equity

(Unaudited)


	Common Stock			Accumulated Other Comprehensive Loss		Retained Earnings		Total Equity
	Shares	Amount
	(in thousands)




















Balance as of September 30, 2025	54,805	$	628,118	$	(17,867)	$	1,063,784	$	1,674,035
Net income	—	—		—		93,943		93,943
Foreign currency translation	—	—		248		—		248
Cash flow hedge, net of tax	—	—		(1,407)		—		(1,407)
Cash dividends	—	—		—		(16,338)		(16,338)
Dividends on RSUs	—	363		—		(363)		—
Purchases of Maximus common stock	(353)	—		—		(31,055)		(31,055)
Stock compensation expense	—	7,019		—		—		7,019
Tax withholding adjustment related to RSU vesting	—	(6,633)		—		—		(6,633)
RSUs vested	97	—		—		—		—
Balance as of December 31, 2025	54,549	$	628,867	$	(19,026)	$	1,109,971	$	1,719,812


	Common Stock			Accumulated Other Comprehensive Loss		Retained Earnings		Total Equity
	Shares	Amount
	(in thousands)
Balance at September 30, 2024	60,352	$	598,304	$	(32,460)	$	1,276,971	$	1,842,815
Net income	—	—		—		41,196		41,196
Foreign currency translation	—	—		10,452		—		10,452
Cash flow hedge, net of tax	—	—		2,454		—		2,454
Cash dividends	—	—		—		(18,060)		(18,060)
Dividends on RSUs	—	301		—		(301)		—
Purchases of Maximus common stock	(3,113)	—		—		(236,655)		(236,655)
Stock compensation expense	—	6,952		—		—		6,952
Tax withholding adjustment related to RSU vesting	—	(2,305)		—		—		(2,305)
RSUs vested	47	—		—		—		—
Balance as of December 31, 2024	57,286	603,252		$	(19,554)	1,063,151		1,646,849

See accompanying notes to consolidated financial statements.

Table of Contents

Maximus, Inc.

Notes to the Consolidated Financial Statements

1. ORGANIZATION

Maximus, a Virginia corporation, is a leading provider of tech-enabled services to government agencies. By moving people, technology, and government forward, Maximus helps improve the delivery of public services for more than 100 million American citizens amid complex technological, health, economic, and social challenges. As a trusted and accountable partner to primarily U.S. federal and state customers, we proudly design, develop, and deliver innovative and efficient programs that are designed to improve government’s effectiveness in serving its citizens.

2. SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements, including the notes, include our accounts and those of our wholly-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP, and the rules and regulations of the Securities and Exchange Commission (SEC). All intercompany balances and transactions have been eliminated in consolidation.

Basis of Presentation for Interim Periods

Certain information and disclosures normally included for the annual financial statements to be prepared in accordance with U.S. GAAP have been condensed or omitted for the interim periods presented. We believe that the unaudited interim financial statements include all adjustments (which are normal and recurring in nature) necessary to present fairly our financial position and the results of operations and cash flows for the periods presented.

The results of operations for the interim periods presented are not necessarily indicative of results that may be expected for the year or future periods. The financial statements should be read in conjunction with our audited consolidated financial statements and the accompanying notes contained in our Annual Report on Form 10-K for the fiscal year ended September 30, 2025. We have continued to follow the accounting policies set forth in those financial statements.

Use of Estimates

The preparation of these financial statements, in conformity with U.S. GAAP, requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities, and the reported amounts of revenue and expenses. At each reporting period end, we make estimates, including those related to revenue recognition and cost estimation on certain contracts, the realizability of long-lived assets, and amounts related to income taxes, certain accrued liabilities, and contingencies and litigation.

At December 31, 2025, our capitalized software balance includes $40.5 million related to technology for new services within our U.S. Services Segment. If circumstances change, we may be required to adjust the value or asset life of these assets.

Table of Contents

3. BUSINESS SEGMENTS

We conduct our operations through three business segments: U.S. Federal Services, U.S. Services, and Outside the U.S. Our operating segments represent the manner in which our Chief Executive Officer (CEO), who is our Chief Operating Decision Maker, reviews our financial results. Our CEO assesses the performance of and allocates resources to each operating segment using information about the operating segment's revenue, gross profit, and segment income (loss) from operations. Our CEO does not evaluate operating segments using asset or liability information.

U.S. Federal Services

Our U.S. Federal Services Segment delivers solutions that help various U.S. federal government agencies better execute on their mission, including program operations and management, clinical services, and advanced technology solutions.

U.S. Services

Our U.S. Services Segment provides a variety of services, such as program operations, clinical services, employment services and advanced technology solutions and related professional services work for U.S. state and local government programs. These services support a variety of programs, including the programs under Medicaid and Children's Health Insurance Program (CHIP), the Affordable Care Act (ACA) marketplaces, and Temporary Assistance to Needy Families (TANF).

Outside the U.S.

Our Outside the U.S. Segment provides business process services and other solutions for international governments. These services include health and disability assessments, program administration for employment services, wellbeing solutions and other job seeker-related services, digitally-enabled customer services, and advanced technologies for modernization. We support programs and deliver services in the United Kingdom, including the Functional Assessment Services (FAS) contract and the Restart employment program. We also provide services in Canada and the Middle East.

Table of Contents


Table 3.1: Results of Operations by Business Segment
	For the Three Months Ended December 31, 2025
(dollars in thousands)	U.S. Federal Services		% (1 )		U.S. Services		% (1 )		Outside the U.S.		% (1 )		Total
Revenue	$	786,601			$	415,248			$	143,197			$	1,345,046
Cost of revenue	571,666		72.7	%	330,854		79.7	%	123,856		86.5	%	1,026,376
Gross profit	214,935		27.3	%	84,394		20.3	%	19,341		13.5	%	318,670
Other segment items (2)	85,202		10.8	%	55,108		13.3	%	20,721		14.5	%	161,031
Segment operating income/(loss)	$	129,733	16.5	%	$	29,286	7.1	%	$	(1,380)	(1.0)	%	157,639
Divestiture-related gains (3)													8,985
Other (4)													(114)
Amortization of intangible assets													(20,300)
Operating income													$	146,210

Depreciation and amortization:	$	7,115	0.9	%	$	4,222	1.0	%	$	1,552	1.1	%	$	12,889

	For the Three Months Ended December 31, 2024
(dollars in thousands)	U.S. Federal Services		% (1)		U.S. Services		% (1)		Outside the U.S.		% (1)		Total
Revenue	$	780,655			$	452,250			$	169,770			$	1,402,675
Cost of revenue	607,340		77.8	%	357,246		79.0	%	136,532		80.4	%	1,101,118
Gross profit	173,315		22.2	%	95,004		21.0	%	33,238		19.6	%	301,557
Other segment items (2)	74,215		9.5	%	54,158		12.0	%	25,118		14.8	%	153,491
Segment operating income	$	99,100	12.7	%	$	40,846	9.0	%	$	8,120

SEC Form 10-Q filed by Maximus Inc.