Parsons Shares Collapse After Losing Major FAA Contract to Peraton

Parsons (PSN) plunged 22% on Thursday after the Federal Aviation Administration selected Peraton, not Parsons, to lead a massive modernization overhaul of the U.S. air-traffic control (ATC) system. The contract represents one of the most significant federal technology modernization efforts in years.

A Multibillion-Dollar Contract Lost

The FAA has $12.5 billion in initial funding allocated.
Total project cost is estimated at ~$31.5 billion over its lifecycle.
Parsons was widely considered a leading contender, making the loss surprising to investors and analysts.

Analysts Call the Outcome a Major Setback

Raymond James

Downgraded PSN to Market Perform from Strong Buy.
Called the FAA decision a “major surprise to investors.”
Warned it removes meaningful upside potential for 2026–27.

William Blair

Trimmed financial estimates for Parsons:
- FY2026 revenue: cut to $6.51B from $6.71B
- Adjusted EBITDA: reduced to $631M from $643M

Analysts across the sector characterized the award outcome as a material blow to Parsons’ growth outlook, especially given the scale and visibility this contract would have provided.

Broader Impact

Losing out on a contract of this size raises questions about Parsons’ competitive positioning in large federal modernization programs, particularly as federal agencies accelerate digital infrastructure upgrades.