HomeSafe, a joint venture with Tier One Relocation, informed us on June 18, 2025, that U.S. Transportation Command unexpectedly terminated HomeSafe's role in the Global Household Goods Contract. KBR owns a 72% interest in HomeSafe. The HomeSafe joint venture is a VIE that is consolidated for financial reporting purposes. As of July 3, 2026, all of HomeSafe's operations, including run-off operations, have ceased. We disposed of HomeSafe during the year ended January 2, 2026 and determined that this disposal met the requirements to be reported as discontinued operations under ASC Subtopic 205-20 Discontinued Operations. We classified the disposal of HomeSafe as discontinued operations because it represents a strategic shift that significantly impacted our long-term operations plan. As such, the results of HomeSafe are presented as discontinued operations in the accompanying condensed consolidated statements of operations, condensed consolidated balance sheets and condensed consolidated statements of cash flows for all periods presented. HomeSafe was previously reported within our MTS business segment.


	Three months ended				Six months ended
Dollars in millions	July 3, 2026		July 4, 2025		July 3, 2026		July 4, 2025
Revenues	$	—	$	27	$	—	$	64
Cost of revenues	1		(40)		—		(79)
Gross profit (loss)	1		(13)		—		(15)
Selling, general and administrative expenses	1		(22)		—		(27)
Loss on disposal (a)	—		(22)		—		(22)

Operating income (loss)	2		(57)		—		(64)


Income (loss) from discontinued operations before income taxes	2		(57)		—		(64)
Provision for income taxes	—		9		—		10
Net income (loss) from discontinued operations, net of tax	2		(48)		—		(54)
Less: Net income (loss) attributable to noncontrolling interests included in discontinued operations	1		(16)		—		(18)
Net income (loss) attributable to KBR from discontinued operations	$	1	$	(32)	$	—	$	(36)

(a) Includes $64 million of asset impairments related to property, plant and equipment and write-offs of $30 million in other assets, offset by elimination of $72 million in other liabilities during the three and six months ended July 4, 2025.


Dollars in millions	July 3, 2026		January 2, 2026
Assets

Cash and cash equivalents	$	3	$	5
Accounts receivable, net of allowance for credit losses	—		1


Other current assets	12		13
Total current assets of discontinued operations	$	15	$	19










Liabilities

Accounts payable	$	5	$	8
Contract liabilities	2		2
Accrued salaries, wages and benefits	—		1


Other current liabilities	9		8
Total current liabilities of discontinued operations	$	16	$	19