AeroVironment, Inc.

Thank you for standing by. Welcome to the AeroVironment second quarter fiscal year 2026 earnings conference call. 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 11 on your telephone. Please be advised that today's conference is being recorded. I would now like to hand the conference over to the head of investor relations, Denise Paccioni. Please proceed.

Thank you and good afternoon, ladies and gentlemen. Welcome to AeroVironment's second quarter fiscal year 2026 earnings call. My name is Denise Paccioni, head of investor relations for AeroVironment. Before we begin, please note that certain information presented on this call contains forward-looking statements within the meaning of the Private Securities Litigation Reform 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 statement portions of such filings. Copies are available from the SEC on the Air Environment website, 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, December 9th, 2025. The company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise. Joining me today from Arrow Environment our Chairman, President, and Chief Executive Officer, Mr. Waheed Nawabi, and Executive Vice President and Chief Financial Officer, Mr. Kevin MacDonald. We will now begin with remarks from Waheed Nawabi. Waheed?

Thank you, Denise. Welcome, everyone, to our second quarter fiscal year 2026 earnings conference call. I'll begin by summarizing our quarterly performance, followed by Kevin, who will review our financial results in greater detail, and then discuss guidance for fiscal year 2026. After this, Kevin, Denise, and I will take your questions. I'm pleased to report excellent quarter financial results while setting new records in multiple areas of our business. Despite the challenges posed by the elongated U.S. government shutdown, we delivered excellent financial results and achieved several strategic milestones that we believe position AV for strong sustained growth well into the future. During the quarter, we introduced several innovative products and secured multiple large long-term contracts, a testament to a recipe for innovation and proof that our strategy is winning. The total ceiling value of new contract awards during Q2 reached $3.5 billion, a historic record achievement by AB. This also resulted in record second quarter bookings of nearly $1.4 billion. These achievements underscore that our strategic investments are delivering results and progressing our business to new heights. We also made significant progress on multiple programs of record that we believe will solidify our leadership in all of the domains in which we participate, air, land, sea, space, and cyber. With strong top line growth expected on the horizon, We are executing on our expansion plans to further scale our manufacturing capacity and meet accelerating demand across several of our products and programs. Our proven execution capabilities, combined with the robust pipeline of orders and operational readiness, reinforce our confidence in achieving our industry-leading long-term growth objectives. At the same time, overall, the integration of Blue Halo is exceeding expectations. strengthening our capabilities and positioning AV as the premier next-generation defense tech company. Let me summarize our key messages for the second quarter of fiscal year 2026, which are including... Awards with a total contract value of $3.5 billion, bolstered bookings to reach an all-time high of nearly $1.4 billion, driven by key program wins that support AV's long-term growth. Second, we also achieved another record second quarter revenue of nearly $473 million. Third, we launched several new innovative products aligned to our customers' highest priorities and continue to execute on expanding our manufacturing capacity to meet accelerated demand. And fourth, we're raising the lower end of our fiscal year 2026 revenue guidance and now expect revenues between $1.95 billion and $2 billion. Beyond these strong results, the defense industry is at an inflection point. NAV is not just prepared to lead. We are ahead of the curve, setting the pace for everyone else to follow. Let's not forget the U.S. Department of War is firmly committed to shifting their procurement practices towards agile, commercially available products and capabilities, favoring companies that invest their own capital, develop disruptive solutions at speed, while transitioning them to full-rate production and scaling capacity quickly. This validates the business model AV has embraced not just in the past few years, but over multiple decades. AV's business model and strategy have always been to invest in innovative and disruptive solutions ahead of customer requirements, scale their production rapidly, and deliver decisive advantages that enable our customers to acquire capabilities quickly. Looking ahead, cost-efficient autonomous drones and counter-drone systems, enabled by AI and machine learning, will define the battlefield. uncrewed aircraft systems and leading AI integration, we believe AV is uniquely positioned to capitalize on this transformation. AV Halo, our open architecture software platform, is designed to unify command and control, intelligence analysis, synthetic training, and autonomous targeting across all domains, creating advanced communication among critical assets during conflict. By integrating AV Halo into our portfolio and other platforms, we're delivering a powerful hardware agnostic ecosystem that enhances the speed, autonomy, and interoperability of AV's platforms for our customers. Moreover, we expect that AV Halo's ability to enable competing products to operate on a common command and control software system will play an increasingly crucial role in U.S. defense procurement decisions. Our investment and development in AV Halo is just one example of how AV is ahead of this transformation and is well positioned within the industry. Our level of internal R&D investment and proactive CAPEX strategy enable us to accelerate development and scale production ahead of demand. Using internal R&D to advance new products allows our technology to outpace our peers and leads to a faster time to market. We believe this core competency is a key differentiator that allows us to stay ahead of our customers' needs. Unlike traditional contractors that wait for contract vehicles before building prototypes, we innovate first, bring solutions to market faster. These forward-looking investments are not only fueling the launch of new products, but also translating into significant contract wins reinforcing our ability to capture emerging opportunities. For example, in our autonomous system segment, our P550 was recently down-selected by the U.S. Army's Long Range Reconnaissance Program, or LRR, estimated to be worth approximately $1 billion. Internal investments made on this Group 2 uncrewed solution allowed us to quickly meet the needs and requirements included in the LRR program, and we're confident that our P550 is the best solution for the U.S. Army. We've also prudently invested in upgrades to our Group 3 uncrewed aircraft system, Jump 20 and Jump 20X, which was recently selected as one of four options on the U.S. Navy's basic ordering agreement. This significant achievement allows AV to compete for specific U.S. Navy intelligence, surveillance, and reconnaissance, or ISR, task orders, over the next five years in a large and rapidly growing UAS maritime defense market. In addition to these domestic achievements, we're also expanding and experiencing an increase in international demand. Within our autonomous system segment, we were recently awarded an $874 million sole source IDIQ contract from the U.S. Army for international sales of our small UAS products to include Raven, PUMA AE, and PUMA LE. This IDIQ contract vehicle also allows for the sale of our Jump 20 medium UAS and Titan series of counter UAS solutions. Our strategy is driving tangible results, which is evident in the successful product launches this quarter. We recently unveiled several new offerings, including our next generation of switchblade-loading munitions with our Switchblade 600 Block II, Switchblade 400, and Switchblade 300 Block XX. These products were mostly internally funded and developed quickly, helping to expand the switchblade product line and create long-endurance multi-domain anti-armor solutions, ensuring warfighters maintain tactical overmatch in contested environments. We also debuted our next generation Vapor Compact Long Endurance Helicopter, or Vapor CLE. This Group 2 VTOL UAV is fully autonomous and can deliver up to two hours of flight, which is double the endurance of typical Group 2 quadrotor UAV platforms. Our newly integrated NVIDIA Orin onboard computer makes the VAPOR CLE fully autonomous and enables automatic target recognition through AV Halo vision, computer vision software, and AV Halo Wizard, artificial intelligence machine learning AI ML processing suite. On our last earnings call, we discussed the significance of our software solution, AV Halo. Since then, we have announced that AV was awarded the U.S. Army's contract for Human-Machine Integrated Formation, or HMIF program. This award accelerates fielding of multi-domain robotic formations using AV's unified interface of command and control, tactical awareness, and autonomy solutions at the tactical edge. As part of this win, AV is going to be the lead software and system integrator for robotic systems on the edge of the battlefield. This award also validates the strength of our approach to software solutions, common controllers, and user interfaces, and underscores the Army's confidence in AV's ability to deliver mission-critical solutions. We also just released two new products from the AV Halo suite, including AV Halo Cortex, a next-generation intelligence fusion and analysis environment, and AV Halo Mentor, a warfighter readiness suite that leans on virtual and augmented reality weapons training and mission rehearsal. AV Halo will continue to roll out more products and offerings that position AV as the core and leading developer in this space. Furthermore, we recently announced a collaboration with OpenJAUS or Open JAWS. Open JAWS is an open architecture for software framework that allows robots, drones, missiles, and ground vehicles to speak the same language. This integration extends AV Halo compatibility to seamlessly incorporate robotics, allowing original equipment manufacturers to integrate their platforms faster and more easily. This collaboration strengthens AV's role as a driver and leader of the industry's push towards interoperability. In addition, AV won several key awards in our space, cyber, and directed energy segment with critical new contracts in laser communications, space-related satellite communications, and directed energy. For example, AV received a $240 million contract for our long-haul laser communication terminals, one of the largest to ever be awarded in this category. This disruptive innovation is moving from lab to orbit, a critical step for AV and the industry. Long-haul laser communications use precision optical links to move enormous amounts of data between satellites faster, more securely, and without the vulnerabilities of traditional radio frequency or RF signals. This capability is critical because it creates a resilient, high-bandwidth backbone for future space networks. ensuring warfighters and decision makers get the right information instantly, even in contested environments. This win continues to push AV to the center of innovation in space. Additionally, AV secured a new firm fixed price option for two Badger phased array systems under the SCAR, or Satellite Communication Augmentation Resource Program. This program represents a tremendous growth opportunity for AV as more Badger systems move into production. Lastly, AV was awarded a contract valued at $499 million by the US Air Force Research Laboratory to develop material technology and deploy protective solutions to the front lines to guard war fighters against exposure to harmful electromagnetic radiation. Work under this large program known as Helmsman will help deter against directed energy strikes in the future. We continue to set the standard in advanced protective technologies and directed energy defense, positioning AV as a clear leader in safeguarding war fighters against emerging threats. Further, our disruptive solutions continue to position AV as a leader in next generation defense. From our family of switchblade loitering munitions to advanced counter UAS solutions, we're redefining the battle space. We have unseated incumbents with our Locust laser weapon system and secured key wins like Freedom Eagle 1 or FE1, delivering cost-effective kinetic counter UAS solutions for Group 3 and 4 drones and beyond. With our AI and machine learning-driven platforms, We believe AV continues to set the industry standard, positioning us to fully capitalize on the generational opportunities ahead. During the quarter, we continue to form additional strategic alliances and collaborations that will help AV expand domestically and internationally. In September, we signed a memorandum of understanding with Taiwan's National Changshan Institute of Science and Technology, or NCSIST. to collaborate on autonomous systems and technology to support Taiwan's defense and security needs. We also signed a memorandum of understanding with Korean Air to advance medium and crude aircraft systems to the Republic of South Korea. Both of these agreements underscore our expanding international presence and steadfast commitment to providing flexible, mission-ready solutions for our customers. Both agreements are centered around AV's Jump 20 and Jump 20X systems. These systems provide the kind of operational versatility that continues to grow in popularity in international markets. We also announced a collaboration with Grand Sky to establish the foundation for a Golden Dome for America Limited Area Defense Architecture at Grand Forks Air Force Base in North Dakota. This collaboration is significant as it marks the first deployment of AV's critical counter UAS solution set to secure a U.S. Air Force base, creating a model that can be replicated across other critical U.S. national security sites. As the demand for innovative offerings accelerates, we recognize the critical importance of scaling quickly. Since last year, we have been focused on securing a new facility in Salt Lake City to expand our switchblade manufacturing further. Plans are progressing on a 100,000 square foot facility that will allow for multiple switchblade lines and provide additional capacity. This new factory has the potential capacity to produce over $2 billion worth of switchblades or other AV products per year. we anticipate this factory to be operational about a year from now. Beyond expanding our own footprint, we're also actively strengthening our supply chain to support anticipated demand continuing to stay ahead of the market. As part of our distributed approach to manufacturing for resiliency and risk diversification, we now have manufacturing sites operating across 12 different states reinforcing our ability to scale rapidly and reliably. In addition to scaling operations, we're transforming the defense technology landscape through our acquisition of Blue Halo. We are already realizing meaningful synergies from the Blue Halo acquisition, which Kevin will discuss in further detail. Together, we're building next-generation platforms that fuse counter UAS space technologies, directed energy, electronic warfare, cyber, and integrated software solutions, creating a suite of capabilities unmatched in the industry. This combination accelerates innovation and continues to position AV as the disruptor deriving rapid change in a market hungry for speed, agility, and advanced solutions. We are reshaping expectations, and setting a new standard for what can be delivered to the US and our allied forces. Before turning the call over to Kevin, who will provide more financial details on our second quarter results, let me conclude with the following comments. Despite a challenging environment, we delivered a strong quarter. Our continued investment in R&D and capacity expansion is translating into strong growth and key program wins and positioning AV for even more growth in the coming years. We recognize there is a generational shift in the U.S. Department of Defense's procurement strategy and product needs. Our offerings are designed to meet warfighter requirements and our strategy is fully aligned with these new practices. We're executing on manufacturing expansion and are confident that we can meet increased demand. Integration of Blue Halo is progressing well, and this acquisition is helping to establish AV as a next-generation defense technology company with unmatched capabilities across multiple domains. With that, I would like to now turn the call over to Kevin McDonald for a review of our second quarter financials.