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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

Commission file number 1-6035

THE TITAN CORPORATION
(Exact name of registrant as specified in its charter)

        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 ý    No o

        Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Securities Exchange Act). Yes ý    No o

        The number of shares of registrant's common stock outstanding at July 28, 2004, was 84,363,678.

Part I—FINANCIAL INFORMATION

Item 1. Financial Statements

THE TITAN CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per share data)

The accompanying notes are an integral part of these consolidated financial statements.

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THE TITAN CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)

The accompanying notes are an integral part of these consolidated financial statements.

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THE TITAN CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands of dollars)

The accompanying notes are an integral part of these consolidated financial statements.

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THE TITAN CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Unaudited)
(In thousands of dollars, except per share data)

The accompanying notes are an integral part of these consolidated financial statements.

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THE TITAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2004
(in thousands, except per share data, or as otherwise noted)

Note (1) Basis of Financial Statement Preparation

        The accompanying consolidated financial information of The Titan Corporation and its subsidiaries (Titan or the Company) should be read in conjunction with the Notes to Consolidated Financial Statements contained in our Annual Report on Form 10-K to the Securities and Exchange Commission for the year ended December 31, 2003. The accompanying financial information includes substantially all subsidiaries on a consolidated basis and all normal recurring adjustments which are considered necessary by the Company's management for a fair presentation of the financial position, results of operations and cash flows for the periods presented. However, these results are not necessarily indicative of results for a full fiscal year. Additionally, certain prior period amounts have been reclassified to conform to the current period presentation.

        The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

        Prior to the discontinuance of certain operations in 2002, Titan grouped its businesses into five business segments—Titan Systems, Titan Wireless, Software Systems (including Cayenta), Titan Technologies and the SureBeam business. Titan is no longer reporting the results of operations by these segments, however, reference may be made to these segments in discussions of other historical information. In accordance with Statement of Financial Accounting Standards (SFAS) No. 131, "Disclosures about Segments of an Enterprise and Related Information," substantially all of Titan's operations are aggregated into one reportable segment given the similarities of economic characteristics between the operations and the common nature of the products, services, and customers.

Significant Accounting Pronouncements

        Stock-Based Compensation.    As allowed by SFAS No. 123, "Accounting for Stock-Based Compensation", Titan has elected to continue to apply the intrinsic value based method of accounting for stock options and has adopted the disclosure only provisions of the fair value method contained in SFAS No. 123. Compensation cost, if any, is measured as the excess of the quoted market price of Titan's stock on the date of grant over the exercise price of the grant. Had compensation cost for Titan stock-based

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compensation plans been determined based on the fair value method at the grant dates for awards under those plans, our results of operations would have been reduced to the pro forma amounts indicated below:

        Goodwill and Other Intangible Assets.    Goodwill represents the excess of costs over fair value of assets of businesses acquired. Effective January 1, 2002, Titan adopted SFAS No. 142, "Goodwill and Other Intangible Assets," which establishes financial accounting and reporting for acquired goodwill and other intangible assets and supersedes APB Opinion No. 17, "Intangible Assets". Goodwill and intangible assets acquired in a purchase business combination and determined to have an indefinite useful life are not amortized, but instead tested for impairment at least annually in accordance with the provisions of SFAS No. 142. SFAS No. 142 also requires that intangible assets with estimable useful lives be amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment in accordance with SFAS No. 144, "Accounting for Impairment or Disposal of Long-Lived Assets."

        SFAS No. 142 requires that goodwill be tested for impairment at the reporting unit level at adoption and at least annually thereafter, utilizing a two step methodology. The initial step requires Titan to assess whether indications of impairment exist. If indications of impairment are determined to exist, the second step of measuring impairment is performed, wherein the fair value of the relevant reporting unit is compared to the carrying value, including goodwill, of such unit. If the fair value exceeds the carrying value, no impairment loss is recognized. However, if the carrying value of the reporting unit exceeds its fair value, the goodwill of the reporting unit is impaired.

        Titan performs its annual testing for impairment of goodwill and other intangible assets in the first quarter of each year, prior to the release of the financial statements for the previous year. Based on management's annual testing as of January 1, 2004, there were no indicators of impairment. However, in June 2004, in connection with the decision to dispose of certain operations as discussed more fully in Note 5, management determined that there were impairments related to certain goodwill and purchased intangibles of its Datron World Communications business.

Note (2) Merger, Investigation and Settlement Costs

        On June 26, 2004, Lockheed Martin Corporation terminated the merger agreement pursuant to which Lockheed Martin was to have acquired Titan. The merger agreement was entered into in September 2003 and amended in March 2004 and April 2004 to provide additional time for Titan to resolve issues and concerns related to internal reviews, and the related Securities and Exchange Commission (SEC) investigation and Department of Justice (DOJ) criminal inquiry, into whether payments involving Titan's international consultants were made in violation of applicable law (see Note 8). Under the amended merger

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terms, it was a condition to closing that Titan either must have obtained written confirmation that the Criminal Division of the DOJ considered its criminal inquiry resolved and did not intend to pursue any claims against Titan relating to this matter, or must have entered into a plea agreement with the Criminal Division of the DOJ and completed the sentencing process. Titan did not satisfy either of these conditions.

        In the three months and six months ended June 30, 2004, respectively, Titan incurred approximately $8.8 million and $26.4 million in legal, investment banking, accounting, printing and other professional fees and costs related to the terminated merger with Lockheed Martin, which are reflected in Merger, Investigation and Settlement Costs in the accompanying consolidated statements of operations. The merger-related costs include the costs of an exchange offer and consent solicitation for Titan's senior subordinated notes and administrative costs associated with the redemption of Titan's preferred stock (see Note 4), both of which were conditions to close the proposed merger. The investigation related costs, which approximated $6.2 million and $18.0 million in the three months and six months ended June 30, 2004, respectively, include the costs associated with the comprehensive internal review being conducted by Titan to evaluate whether payments involving international consultants for Titan or its subsidiaries were made in violation of applicable law. The legal, accounting and other professional fees incurred also supported the related inquiry by the Department of Justice and the investigation by the Securities and Exchange Commission. Refer to Note 6 for a discussion of the impact of the terminated merger on Titan's outstanding debt.

        In the three months and six months ended June 30, 2004, Titan recorded an additional provision of $25.5 million for anticipated settlement costs related to the government Foreign Corrupt Practices Act (FCPA) investigations. Titan had previously recorded $3.0 million as of December 31, 2003, for resolution of this matter, thereby bringing the total amount recorded to $28.5 million representing Titan's estimate of potential liabilities related to this matter. The ultimate resolution of this matter is dependent upon the final results of such inquiries and investigations, and associated liabilities could be different from the amount currently estimated. The Company did not accrue for any remaining legal costs expected to be incurred to reach resolution of the FCPA matter, as those costs will be expensed as incurred in future periods. Titan is continuing to cooperate fully with the government to resolve the investigations (see Note 8).

Note (3) Asset Impairment Charges

        During the three months and six months ended June 30, 2004, Titan recorded asset impairment charges totaling $22.7 million. Approximately $10 million of these charges pertain to impairment of fixed assets directly related to the termination of a program by a U.S. civilian government agency in the second quarter, and impairment of assets associated with a reduction in scope of planned business activities in Saudi Arabia. As a result of curtailing the activities in Saudi Arabia and with the U.S. civilian government agency, future cash flows will be insufficient to recover the carrying value of certain dedicated assets. Approximately $7.2 million of these charges are related to a revised estimate of the net realizable value of SureBeam-related assets transferred to Titan in the April 2004 bankruptcy court settlement of SureBeam's indebtedness and other obligations to Titan (see Note 8). This revised estimate was made using updated information related to potential sales of assets and transfers of obligations. Approximately $5.5 million related to a charge for impairment of a technology license Titan purchased from SureBeam in 2001 (see Note 8).

Note (4) Redemption of Cumulative Convertible Preferred Stock

        On March 15, 2004, Titan redeemed all outstanding shares of its cumulative convertible preferred stock. The redemption was a condition to the close of the then proposed merger with Lockheed Martin. An aggregate of 625,846 shares were redeemed at $20 per share, plus cumulative dividends in arrears of $0.03 per share, which utilized cash of approximately $12.5 million, and the remaining 60,983 shares of

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preferred stock were converted by shareholders into 47,580 shares of common stock. The redemption of the preferred stock is recorded as a reduction to stockholders' equity.

Note (5) Discontinued Operations

        In June 2004, Titan's board of directors made the decision to sell or otherwise divest Titan's Datron World Communications business (Datron World) and its Titan Scan Technologies service business (Scan Services). These are non-core operations that have not performed to management's expectation, and their divestiture will allow Titan to better focus on its National Security Solutions businesses. Previously, Datron World has been reported in the Titan Systems segment and the Titan Scan Technologies services business was reported in the Titan Technologies segments, and are presented below within those segments. These businesses have been reported as a discontinued operation in accordance with SFAS No. 144, and all periods presented have been restated accordingly to reflect these operations as discontinued.

        The results of discontinued operations for the three months and six months ending June 30, 2004, for Datron World include asset impairment charges of approximately $20.3 million for impaired purchased intangible assets, mostly goodwill, of approximately $17.3 million, and approximately $3.0 million related to inventory value not expected to be recovered in the disposal of this business. Revenues for Datron World for the six months ended June 30, 2004, were $6.6 million.

        The results of discontinued operations for the three months and six months ending June 30, 2004, for Scan Services include asset impairment charges of approximately $8.5 million, primarily representing fixed asset values not expected to be recovered in the disposal of the business. The estimate of value expected to be recovered upon disposition is based on indications of interest and proposed letters of intent received by Titan. Revenues for Scan Services for the six months ended June 30, 2004, were $2.8 million.

        In July 2002, Titan's board of directors made the decision to exit all of our international telecommunications business through a combination of selling and winding down our operations within our Titan Wireless segment. Titan immediately began implementing these actions, which were substantially completed during 2003. Titan reported this exit of the Titan Wireless segment as a discontinued operation in accordance with SFAS No. 144.

        In the third quarter of 2003, Titan completed the sale of its GlobalNet business. Payments received for the sale of GlobalNet consisted of approximately $2 million in cash, notes receivable of approximately $1.5 million, and the buyer's assumption of all of the outstanding liabilities of GlobalNet, which aggregated to approximately $21 million at the time of the consummation of the sale. Titan has collected approximately $0.6 million of the amounts due under the notes receivable; however, the remaining $0.9 million is past due and was previously reserved, as Titan has no assurance that this remaining balance will ultimately be collected. In accordance with SFAS No. 144, all commercial operations that have been sold or are held for sale have been reflected as discontinued operations for all periods presented in Titan's consolidated financial statements.

        On December 10, 1999, Titan's wholly owned subsidiary, Titan Africa, Inc. (Titan Africa), in connection with its contract to build a satellite-based telephone system for its customer, the national telephone company of Benin, Africa (the OPT), entered into a Loan Facility agreement for up to 30.0 billion Francs CFA (the currency of the African Financial Community), equivalent to approximately $45.0 million U.S. dollars, with a syndicate of five banks, with Africa Merchant Bank as the arranger. This financing was subsequently increased by 6.0 billion francs CFA to approximately $54.0 million. This medium term financing is a non-recourse loan to Titan Africa which is guaranteed by the national telephone company of Benin, Africa and secured by the national telephone company's equipment and revenues related to the project. The facility has a fixed interest rate of 9.5% per year and was originally to be repaid in seven equal semi-annual payments from the net receipts of this project, or by the OPT in the event that such receipts are not adequate to make these payments, which commenced on December 31, 2000 and were scheduled to end on December 31, 2003. The payment terms were subsequently amended

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calling for quarterly payments through mid 2006. The borrowings on this facility have been utilized to fund various equipment and subcontractor costs incurred most notably by Alcatel of France, a major subcontractor to this project.

        Related to Titan's contract with the OPT, Titan has a $44.5 million gross receivable due from the OPT, which is reflected in current assets of discontinued operations as of June 30, 2004, less a reserve of $14.3 million discussed below. Of this amount, approximately $30.2 million is recorded as a receivable on the project, reflecting the outstanding balance on the non-recourse loan, drawn to cover subcontract costs. The $30.2 million balance on the non-recourse loan is included in non-current liabilities of discontinued operations at June 30, 2004. The $14.3 million net receivable represents amounts due from the OPT under the Titan settlement agreement entered into with the OPT in 2003. This agreement contemplated a $35 million payment by the OPT to Titan, which was due in full by November 30, 2003. On December 31, 2003, we received a partial payment of $11 million on the settlement. Based on the facts available at June 30, 2004, principally the OPT's cash flow deficiencies and inability to obtain adequate financing, Titan recorded a full reserve in the three months ended June 30, 2004, for the $14.3 million balance outstanding at June 30, 2004. Notwithstanding this reserve, Titan has commenced an international arbitration against the OPT seeking collection of this receivable. The Wireless results of discontinued operations also reflect a reserve of approximately $3.9 million recorded in the three months ended June 30, 2004, for estimated costs of resolving a contingent liability with a subcontractor related to its subcontract. The current liabilities of $13.6 million of Titan Wireless include approximately $12.1 million of remaining exit costs.

        On June 2, 2004, Titan sold Cayenta Canada, its remaining commercial information technology business, for $6.0 million in cash, with no resulting gain or loss recorded on the sale. Titan retained current liabilities related to this business which are included in Titan Technologies below, of approximately $2.3 million related to potential purchase price adjustments due to the buyer, transaction-related costs and indemnification obligations related to the sale. Additionally, Titan had previously guaranteed performance on several customer contracts and a facility lease related to this business and these guarantees were not transferred to the buyer in the June 2004 sale. The face value of these guarantees is approximately $14 million at June 30, 2004. Substantially all of the guarantees were issued prior to December 31, 2003 and are therefore not required to be recognized and measured under the provisions of FASB Interpretation No. 45, "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others—an Interpretation of FASB Statements No. 5, 57, and 107 and Rescission of FASB Interpretation No. 34." Titan has not had to make any payments with respect to contract guarantees related to this business since its acquisition in 1999 and has not provided any reserves for these contingencies at June 30, 2004, based on management's assessment that such payments are not probable of being made.

        The current assets of Titan Systems and Titan Technologies below at June 30, 2004, are primarily comprised of accounts receivable and inventory balances.

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Income Statement Summary

        Following is a summary by original business segment of the income (loss) from discontinued operations for 2004 and 2003:

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        Titan Technologies' 2004 and 2003 results above include operating income in Canada for which there is no tax impact. The tax benefit for Titan Systems' results in 2004 was reduced as a result of the non-deductibility of the impairment of the intangible assets of Datron World. Included in the results for the quarter and six months ended June 30, 2003, is a tax benefit of $2.3 million recorded to reflect the estimated tax impact of adjusting the carrying value of certain assets of Cayenta Canada, which was sold in June 2004.

Note (6) Debt

Senior Credit Facitlity

        At June 30, 2004, total borrowings outstanding under Titan's senior credit facility were $393.9 million at a weighted average interest rate of 4.52%. Commitments under letters of credit, which reduce availability under the senior credit facility, were approximately $10 million at June 30, 2004, resulting in approximately $75 million of borrowing availability on the senior revolver at June 30, 2004. Of the total outstanding borrowings, $3.5 million was short-term. At June 30, 2004, Titan was in compliance with all financial covenants under its various debt agreements. The remaining unamortized deferred costs and expenses of $7.5 million related to the senior credit facility, which were incurred primarily in 2002, are included in Other Assets at June 30, 2004 and will be amortized over the remaining term of the senior credit facility, assuming no prepayment is made.

Senior Subordinated Notes

        On May 15, 2003, Titan sold $200 million of 8% senior subordinated notes due May 15, 2011, in a private placement (the Notes). Titan used the net proceeds from the issuance of the Notes, plus borrowings of $50 million under the revolving credit facility and additional cash on hand, to redeem all of the $250 million of the then-outstanding 5³/4% HIGH TIDES convertible preferred securities. The redemption of HIGH TIDES occurred on June 4, 2003.

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        Titan is required to make interest payments on the Notes semi-annually in arrears on May 15 and November 15 at the rate of 8% per annum. Titan may redeem the Notes, in whole or in part, on or after May 15, 2007 at the following redemption prices, plus accrued and unpaid interest and liquidated damages, if any:

        In addition, on or prior to May 15, 2006, Titan may redeem up to 35% of the aggregate principal amount of the Notes with the net proceeds of certain equity offerings at a redemption price of 108% of principal together with accrued and unpaid interest. The Notes are unsecured and rank or will rank equally with Titan's current or future senior subordinated indebtedness. Each of Titan's domestic subsidiaries other than Cayenta guarantee the Notes. The guarantees are unsecured and rank equally with each guarantor's senior subordinated indebtedness. The Notes and the guarantees are junior to all of Titan's and each guarantor's senior indebtedness and senior to all of Titan's and each guarantor's subordinated indebtedness (see Note 10). On July 19, 2004, Titan completed an exchange offer pursuant to which noteholders exchanged all but $0.4 million in principal amount of the Notes for newly issued 8% senior subordinated notes due 2011 registered under the Securities Act of 1933 with substantially the same terms and conditions and covenants as the Notes. Upon completion of the exchange offer, liquidated damages ceased to accrue on the notes.

        Liquidated damages of 0.25% per annum per $1,000 whole dollars in principal amount of the existing Notes began to accrue in October 2003. Beginning in January 2004, the liquidated damages rate increased to 0.50% and such liquidated damages continued to accrue, at rates increasing every 90 days by 0.25% per annum per $1,000 whole dollars in principal amount of existing notes up to a maximum of 2.00%, until the exchange offer described above was completed. The balance accrued at June 30, 2004 is $0.2 million. The liquidated damages are paid with the regular semi-annual interest payment.

        The remaining unamortized deferred costs and expenses of $5.4 million related to the issuance of the Notes, which were incurred in 2003, are included in Other Assets at June 30, 2004, and are amortized over the term of the Notes.

Note (7) Other Financial Information

Earnings Per Share

        Basic and diluted earnings per share were computed based on net income, less the regular quarterly dividend requirement for preferred stock in 2004 and 2003 and the accrued dividend to the date of redemption in 2004.

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        The following data summarize information relating to the per share computations for income from continuing operations:

        In the three months ended June 30, 2004, options and warrants to purchase approximately 3,136,200 shares of common stock at prices ranging from $1.04 to $17.29 per share were not included in the computation of diluted EPS, as the effect would have been anti-dilutive due to the net loss. In the three months ended June 30, 2004, options and warrants to purchase approximately 362,500 shares of common stock at prices ranging from $19.43 to $29.74 were not included in the completion of EPS as their effect was anti-dilutive due to the exercise price. For the three month period ended June 30, 2003, options and warrants to purchase approximately 4,629,700 shares of common stock at prices ranging from $8.61 to $29.74 per share were not included in the computation as the effect would have been anti-dilutive due to the exercise price.

        In the six months ended June 30, 2004, options and warrants to purchase approximately 3,448,800 shares of common stock at prices ranging from $1.04 to $19.43 per share were not included in the

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computation of diluted EPS, as the effect would have been anti-dilutive due to the net loss. In the six months ended June 30, 2004, options and warrants to purchase approximately 353,200 shares of common stock at prices ranging from $19.43 to $29.74 were not included in the computation of EPS, as the effect would have been anti-dilutive due to the exercise price. In the six months ended June 30, 2003, options and warrants to purchase approximately 4,665,600 shares of common stock at prices ranging from $9.22 to $29.74 per share were not included in the computation of diluted EPS as the effect would have been anti-dilutive due to the exercise price.

        Approximately 223,600 shares of common stock in the six month period in 2004 that could have been issued from the potential conversion of cumulative convertible preferred stock were not included in the computation of diluted EPS, as the effect would have been anti-dilutive due to the net loss. Approximately 537,400 shares of common stock in the three and six month periods in 2003 that could have been issued from the potential conversion of cumulative convertible preferred stock were not included in the computations of diluted EPS, as the effect would have been anti-dilutive. The change in potential dilution from 2003 to 2004 is due to the redemption of the preferred stock on March 15, 2004 (see Note 4). Approximately 4,989,300 and 5,862,800 shares in the three and six months ended June 30, 2003, that could have been issued from the potential conversion of remarketable term income deferrable equity securities (HIGH TIDES) were not included in the computations as their effect was anti-dilutive. The HIGH TIDES were redeemed on June 4, 2003.

Select Statement of Operations Data

        Included in the revenues for the quarter and six months ended June 30, 2004, are revenues related to a single contract with the U.S. Army to provide linguist services of $55.6 million and $99.5 million, respectively, representing 10.8% and 10.3% of total revenues for the quarter and six months, respectively. No other single contract provided more than 3.4% of total revenues for these periods.

        The net gain on sale of assets represents a gain on the sale of certain contracts and related assets and liabilities of $0.9 million, which sale was completed in order to mitigate concerns raised by one customer related to organizational conflict of interest issues arising from the proposed merger with Lockheed Martin. The aforementioned gain was partially offset by a loss of $0.3 million on another sale of certain contracts and related assets and liabilities, which were sold as part of Titan's ongoing strategy to divest non-core assets and operations.

Select Balance Sheet Data

        Following are details concerning certain balance sheet data:

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        A summary of the utilization of exit and restructuring accruals during the six months ended June 30, 2004 is as follows: