AeroVironment, Inc.

Good day, and thank you for standing by. Welcome to the AeroVironment Fiscal 2025 First Quarter Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jonah Teeter-Balin. Please go ahead.

Thanks and good afternoon, ladies and gentlemen. Welcome to Arrow Fireman's fiscal year 2025 first quarter earnings call. This is Jonah Peter-Balin, Vice President of Corporate Development and Investor Relations. Before we begin, please note that certain information presented on this call contains forward-looking statements within the meaning of the Private Securities Litigation Report Act of 1995. These statements involve many risks and uncertainties that could cause actual results to differ materially from our expectations. Further information on these risks and uncertainties is contained in the company's 10-K and other filings with the SEC, in particular in the Risk Factors and Forward-Looking Statements section portions of such filings. Copies are available from the SEC on the Air Environment website at www.avinc.com or from our investor relations team. This afternoon, we also filed a slide presentation with our earnings release and posted the presentation to the investor section of our website under events and presentations. The content of this conference call contains time sensitive information that is accurate only as of today, September 4th, 2024. The company undertakes no obligation to make any revision to any forward looking statements contained in our remarks today or to update them to reflect the events or circumstances occurring after this conference call. Joining me today from our environment are Chairman, President, and Chief Executive Officer, Mr. Waheed Nawabi, and Senior Vice President and Chief Financial Officer, Mr. Kevin McDonald. We will now begin with remarks from Waheed Nawabi. Waheed?

Thank you, Jonah. Welcome, everyone, to our first quarter fiscal year 2025 earnings conference call. I'll start by summarizing our performance and recent achievements, after which Kevin will review our financial results in greater detail. I will then provide our expectations for the remainder of fiscal year 2025, and finally, Kevin, Joan, and I will take your questions. I'm pleased to report another quarter of excellent results in line with our expectations. Our key messages, which are included on slide number three of our earnings presentation, are as follows. First quarter revenue rose to $189.5 million, a 24% increase from the same quarter last fiscal year, and set a new first quarter revenue record for the company. Second, we're now starting to book key switchblade opportunities, such as our recent U.S. Army $1 billion IDIQ contract and anticipate funded backlog to increase in coming quarters. Third, our looting munitions system segment continues its upward momentum with record first quarter revenues of nearly $52 million, a 68% year-over-year increase. And fourth, given our strong execution, key program awards, and robust pipeline, we are reaffirming our previously stated guidance for fiscal year 2025. These first quarter results position us for another record fiscal year as demand for autonomous systems continues to rise. We remain focused on our core strengths in agile innovation, manufacturing, and customer relationships, which is allowing us to extend our leading position in this dynamic and growing market. We were able to achieve strong revenue growth in the quarter while retaining high levels of product quality, performance, and profitability. as our pipeline expands we continue increasing our production capacity to ensure we meet our customers urgent needs through fiscal year 2025 and beyond we believe av is the strongest company in the defense tech sector we have unrivaled battle-tested solutions an unparalleled and large install base industry-leading technology, trusted customer relationships, and robust manufacturing capacity equipped to handle urgent growing demand across the globe. In short, we are well-positioned to meet our U.S. and international customers' growing needs. Our uncrewed systems and military munitions remain our key franchises, and we are proud to serve our customers and their vital missions. While we are pleased with our first quarter results, we're even more excited about what lies ahead for the remainder of fiscal year 2025 and beyond. I would like to now discuss results from each of our three business segments, starting with military munitions systems, or LMS. As I mentioned earlier, LMS was our strongest growth driver for the first quarter of fiscal year 2025. L&S revenue grew 68% from the same quarter last fiscal year to $52 million. Demand for both SwissBlade 300 and 600 remained strong, as demonstrated by recent wins, many of which are not yet reflected in our funded backlog. During the first quarter, SwissBlade 600 was selected for tranche one of the U.S. DoD's replicator initiative. And because of our robust manufacturing capacity, we were able to begin deliveries almost immediately. Additionally, the U.S. DOD announced the approval for an FMS sale to Taiwan for switchblade 300s. Just last week, we received a $128 million award under the U.S. Army's directive requirement for lethal unmanned systems, which is not reflected on our first quarter funded backlog. This award is the first task order that is part of a five-year sole source IDIQ contract with a ceiling value of nearly $1 billion. New terms will also allow for progress payments that will help improve our cash flow and working capital usage. And deliveries for this task order will begin shortly. As a reminder, this is the large multi-year IDIQ contract I discussed on prior earnings calls. These important and significant wins validate our competitive positioning in the market, demonstrate the urgent need for our solutions in active conflict zones, and highlight our ability to deliver in volume as demand rises. Demand for Switchblade continues to rise both domestically and abroad, and AD is committed to meeting our customers' increasing expectations. Our manufacturing capacity is expanding to support more than $500 million in annual switchblade product revenue in fiscal year 2025, and we're prepared to support additional capacity growth in the future. We're also in the process of selecting an additional location where we can expand our loitering munition manufacturing beyond fiscal year 2025. We're confident that the LMS business is only at the beginning stages of this strong growth cycle, and we anticipate continued momentum beyond this fiscal year. Now onto our uncruised system segment. Revenue for the first quarter was $120 million, an increase of 22% from the same quarter last year. Our uncrued system segment remains our strongest revenue and profit driver, due largely to our PUMA franchise and Jump20 platforms. PUMA has continuously demonstrated its importance and effectiveness in current conflicts as the dominant ISR workforce. In fact, we just recently completed our 475th delivery to Ukraine, and we anticipate booking additional promoters as part of the recently announced Ukraine 8 package. We're also optimistic about the advantages and capabilities of our latest small UAS variant called the P550. This enhanced Group 2 platform is purpose-built for long-range reconnaissance missions and features advanced AI and autonomous capabilities with maximum payload versatility. The P550 is part of our recently submitted proposal for the U.S. Army's Long-Range Reconnaissance Program, or LRR. We anticipate strong global demand for this product beyond the U.S. Army's program of record. In addition, our Jump 20 system continues to make progress in this market, and we're still actively engaged on multiple domestic and international opportunities. Given favorable feedback on our PUMA, Jump 20, and P550 platforms, we anticipate domestic international demand for UXS solutions to increase in fiscal year 2025 and beyond. Moving now to our McCready Works segment. Technology developments within the creating works continue to derive our long term growth opportunities. This past quarter, we made meaningful progress toward developing next generation solutions and expanding our AI and autonomous capabilities. For example, during our investor day this past June, we had a live demonstration highlighting our ability to send mission objectives from NASDAQ headquarters in New York City to uncrewed systems operating in California and Kansas, thousands of miles away. Our UAS would have been able to complete those missions fully autonomous without any user intervention. This live demonstration showcases our ability to task hundreds of uncrewed systems from thousands of miles away while these systems operate autonomously in contested environments. This demonstration was a powerful example of how we're pushing the boundaries of what's possible in autonomous systems. Another key priority for McQuaid URPS is DARPA's ancillary program focused on UAS design for ship-based operations. As maritime missions become more important to our customers, McCready Works will continue to focus on developing next-generation solutions for this market. And finally, McCready Works was awarded a $25 million follow-on contract from SoftBank to continue the development of the HABS platform. HABS continues to make good progress on developing systems for both commercial and defense applications. In summary, the innovative solutions generated by this business segment create significant advantages for our customers and play a critical role in fueling our growth well beyond fiscal year 2025. McCready Works continues to fulfill its mission and we look forward to multiple exciting announcements later this fiscal year. With that, I would like to now turn the call over to Kevin McDonald for a review of our first quarter financials. Kevin?