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Team BlueHalo Demonstrates Integrated Backend Mission Services for Space Force’s SCAR Program

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On May 22, 2024, Kratos Defense & Security Solutions (Nasdaq: KTOS) announced the use of its OpenSpace® SATCOM ground system in BlueHalo's demonstration for the U.S. Space Force’s SCAR program at the 2024 Space Symposium in Colorado Springs, CO. This demo showcased integrated backend mission services, including system scheduler and mission processor interfaces. The OpenSpace platform, a software-defined, cloud-agnostic system, supports multi-orbit operations and rapid service instantiation. BlueHalo’s SCAR program, valued at $1.4 billion, aims to enhance satellite control capacity through innovative phased-array antennas and ground systems.

Positive
  • Kratos' OpenSpace Platform showcased its capabilities in a high-profile demonstration for the U.S. Space Force.
  • The OpenSpace system enables rapid service deployments in minutes, enhancing operational agility.
  • BlueHalo's SCAR program is valued at $1.4 billion, indicating significant investment and future revenue potential.
  • Partnerships with BlueHalo and the U.S. Space Force strengthen Kratos' market position in defense technologies.
  • Successful demo likely to bolster Kratos' reputation and business prospects in the defense sector.
Negative
  • No immediate financial gains reported from the demonstration.
  • Dependence on the success of BlueHalo's SCAR program for long-term benefits.
  • Potential risks if the program faces delays or issues in full-scale implementation.

Insights

The integration of Kratos' OpenSpace Platform into BlueHalo's SCAR program represents a significant advancement in the digital transformation of satellite ground systems. The OpenSpace Platform's fully software-defined architecture allows for scalable and flexible deployments through a cloud-agnostic and containerized environment. This drastically reduces the time required to instantiate new services, which is a notable shift from traditional hardware-based systems that can take weeks or months to deploy.

For retail investors, this innovation means that Kratos is positioning itself as a leader in the evolving field of satellite communications. The ability to deploy services quickly and flexibly aligns with emerging needs in national security and defense, especially as space becomes a more contested domain.

Moreover, the use of industry-standard protocols ensures that the platform can integrate seamlessly with other systems, enhancing its adaptability and future-proofing it against obsolescence. This could potentially lead to more government contracts and collaborations, providing a steady revenue stream and boosting investor confidence in the long term.

The announcement underscores a growing trend towards virtualization and software-defined infrastructure in the defense sector. The SCAR program's focus on providing multi-beam, multi-orbit mission operations highlights the increasing complexity and scope of modern satellite missions, which require more robust and adaptable ground systems.

For investors, Kratos' involvement in this $1.4B program is a clear indicator of the company's relevance and capability in this highly specialized market. The successful demonstration and subsequent positive feedback from USSF Guardian operators are strong endorsements that can improve the company's reputation and credibility in the market.

This partnership with BlueHalo not only strengthens Kratos' market position but also opens avenues for future collaborations and contracts. Investors should note that the defense sector's reliance on advanced SATCOM capabilities is likely to increase, providing sustained demand for Kratos' innovative solutions.

From a financial perspective, Kratos' participation in the SCAR program could positively impact the company's revenue streams and profitability. The project’s scale ($1.4B) and the advanced nature of the technology involved indicate that there is significant value linked to this initiative.

Investors should be aware that the defense sector can be quite lucrative due to its long-term contracts and the frequency of government funding, which tends to be stable and substantial. Given that Kratos is a key player in this project, the company is likely to benefit financially through additional contracts and continued partnership with BlueHalo and the USSF.

However, it is important to consider the risks associated with dependency on government contracts, which can be subject to policy changes and budget adjustments. Therefore, while the prospects look promising, a diversified portfolio approach is advisable.

Showcases Kratos’ OpenSpace® Software Ground System Capabilities that will Enable Multi-Orbit, Multi-Mission Operations

SAN DIEGO, May 22, 2024 (GLOBE NEWSWIRE) -- Kratos Defense & Security Solutions, Inc. (Nasdaq: KTOS), a technology company in the defense, national security and global markets, announced today that its fully virtualized satellite communications (SATCOM) ground system, OpenSpace®, was employed as part of BlueHalo’s milestone demonstration for the U.S. Space Force (USSF) Space Rapid Capabilities Office (RCO) Satellite Communication Augmentation Resource (SCAR) program.

BlueHalo, the prime contractor for the SCAR program, successfully demonstrated the integrated backend mission services to USSF Guardian operators at the 2024 Space Symposium in Colorado Springs, CO. During the demonstration, Guardians received an operator orientation for the SCAR system interface, including the system scheduler and backend mission processor. Kratos’ OpenSpace Platform is an important piece of the backend system which will pair with BlueHalo’s BADGER adaptive phased array product to provide multi-beam, multi-orbit mission operations.

“The demonstration at the Space Symposium showed vividly how the SCAR Program is leading in the digital transformation of satellite ground systems to become a more dynamic and resilient part of space domain operations,” commented Phil Carrai, President of Kratos’ Space, Training & Cyber Division. “With OpenSpace and Bluehalo’s BADGER technology, Guardians will be able to rely upon an agile network infrastructure from the gateway to the edge and all points in between.”

Kratos’ OpenSpace Platform is a fully software-defined and orchestrated satellite ground system, enabling scalable deployments within an elastic, cloud-agnostic, virtualized environment built upon widely accepted industry standards and a containerized architecture. With OpenSpace, Guardians can instantiate new services in minutes instead of the weeks, or even months, commonly required with traditional hardware-based ground systems. For more information about the OpenSpace family visit http://KratosDefense.com/OpenSpace.

“BlueHalo has checked off another milestone for the SCAR program–not only demonstrating the system’s backend mission services and user interface but, most importantly, collecting valuable insight from Guardian operators who will rely on this system for critical space operations,” said Mary Clum, BlueHalo Executive Vice President and Sector President of Labs. “With the strong partnerships we have forged with the Space Rapid Capabilities Office and our partners like Kratos, BlueHalo is proud to deliver innovations that will define our national security capabilities for decades to come.”

BlueHalo’s $1.4B Satellite Communication Augmentation Resource (SCAR) program was announced by the USSF Space RCO in May of 2022 to significantly increase satellite control capacity and support their dynamic missions going forward. The program covers initial design through full-rate production–delivering a fleet of transportable, ground-based phased-array antennas and accompanying ground electronics and software to provide robust, flexible command and control capabilities for USSF satellites.

About Kratos Defense & Security Solutions
Kratos Defense & Security Solutions, Inc. (NASDAQ: KTOS) is a technology, products, system and software company addressing the defense, national security, and commercial markets. Kratos makes true internally funded research, development, capital and other investments, to rapidly develop, produce and field solutions that address our customers’ mission critical needs and requirements. At Kratos, affordability is a technology, and we seek to utilize proven, leading edge approaches and technology, not unproven bleeding edge approaches or technology, with Kratos’ approach designed to reduce cost, schedule and risk, enabling us to be first to market with cost effective solutions. We believe that Kratos is known as an innovative disruptive change agent in the industry, a company that is an expert in designing products and systems up front for successful rapid, large quantity, low cost future manufacturing which is a value add competitive differentiator for our large traditional prime system integrator partners and also to our government and commercial customers. Kratos intends to pursue program and contract opportunities as the prime or lead contractor when we believe that our probability of win (PWin) is high and any investment required by Kratos is within our capital resource comfort level. We intend to partner and team with a large, traditional system integrator when our assessment of PWin is greater or required investment is beyond Kratos’ comfort level. Kratos’ primary business areas include virtualized ground systems for satellites and space vehicles including software for command & control (C2) and telemetry, tracking and control (TT&C), jet powered unmanned aerial drone systems, hypersonic vehicles and rocket systems, propulsion systems for drones, missiles, loitering munitions, supersonic systems, space craft and launch systems, C5ISR and microwave electronic products for missile, radar, missile defense, space, satellite, counter UAS, directed energy, communication and other systems, and virtual & augmented reality training systems for the warfighter. For more information, visit www.KratosDefense.com.

About BlueHalo
BlueHalo is purpose-built to provide industry-leading capabilities in the areas of Space, C-UAS and Autonomous Systems, Electronic Warfare & Cyber, and AI/ML. The company develops and brings to market next-generation capabilities to support customers’ critical missions and national security. Learn more at http://www.bluehalo.com and follow BlueHalo on LinkedIn.

Notice Regarding Forward-Looking Statements
Certain statements in this press release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made on the basis of the current beliefs, expectations and assumptions of the management of Kratos and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Kratos undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Kratos believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Kratos in general, see the risk disclosures in the Annual Report on Form 10-K of Kratos for the year ended December 31, 2023, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the SEC by Kratos.

Press Contact:
Yolanda White
858-812-7302 Direct

Investor Information:
877-934-4687
investor@kratosdefense.com


FAQ

What did Kratos demonstrate at the 2024 Space Symposium?

Kratos demonstrated its OpenSpace® SATCOM ground system as part of BlueHalo's integrated backend mission services for the U.S. Space Force’s SCAR program.

What is the SCAR program?

The SCAR program, valued at $1.4 billion, aims to enhance satellite control capacity and support dynamic missions for the U.S. Space Force.

What are the capabilities of Kratos' OpenSpace Platform?

Kratos' OpenSpace Platform is a software-defined, cloud-agnostic SATCOM ground system that enables scalable deployments and rapid instantiation of new services.

How does the OpenSpace system benefit the U.S. Space Force?

The OpenSpace system provides agile, multi-orbit, multi-mission operations, allowing rapid service deployment and enhanced operational resilience.

What is the significance of the partnership between Kratos and BlueHalo?

The partnership combines Kratos' OpenSpace technology with BlueHalo’s phased-array antennas to deliver cutting-edge satellite control capabilities for the U.S. Space Force.

Kratos Defense & Security Solutions, Inc.

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