AeroVironment, Inc.

Good day and thank you for standing by. Welcome to the ERAVironment first quarter fiscal year 2027 earnings call. At this time, all participants are in listen-only mode. After a speaker's presentation, we'll open up for questions. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's call is being recorded. I would now like to hand it over to our first speaker, Denise Pacioni, Head of Investor Relations. Please go ahead.

Thank you and good afternoon, ladies and gentlemen. Welcome to AV's first quarter fiscal year 2027 earnings call. My name is Denise Pacioni, Head of Investor Relations for AV. 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 FDC, In particular, in the risk factors and forward-looking statement portions of such filings. Copies are available from the SEC or on the AirVironment 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, September 9th, 2026. 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 AV are Chairman, President, and Chief Executive Officer, Mr. Wahid Nawabi, and Executive Vice President and Chief Financial Officer, Mr. Sean Woodward. We will now begin with remarks from Wahid Nawabi. Wahid?

Thank you, Denise. Welcome everyone to our first quarter fiscal year 2027 earnings conference call. I will begin today's call by summarizing our quarterly performance, followed by Sean, who will review our financial results in greater detail. After this, Sean, Denise, and I will take your questions. I'm pleased to report excellent first quarter results across several key financial performance metrics that meet or exceeded our expectations. AV reported first quarter revenues of $480 million, with record-setting funded backlog of $1.5 billion, as well as adjusted EBITDA of nearly $46 million and bookings of $683 million. These results reflect our focus on capturing key growth opportunities and our ability to execute with excellence. Building on our success from fiscal year 2026, we believe our first quarter results have positioned us well to deliver an even greater and stronger fiscal year 2027. Before discussing the details of our strong results, let me first highlight some key achievements from the first quarter. First, we won several key contracts on franchise programs during the quarter that contributed to $683 million in bookings. These wins add to a strong bookings pipeline for both this fiscal year and beyond. Second, our funded backlog grew to a record $1.5 billion, which is 37% higher than the same period last year. Third, we achieved record first quarter revenue of $480 million. And fourth, We continue to advance our manufacturing capacity expansion plans across several of our platforms and products to support our strong growth over the next several years. With a strong quarter behind us and positive momentum carrying us into the second quarter, we are reaffirming our fiscal year 2027 revenue guidance of between $2.125 billion and $2.225 billion. and adjusted EBITDA guidance for fiscal year 2027 of between $305 million and $325 million. Both of our business segments are progressing well toward their fiscal year 2027 growth goals, supported by key domestic and international program wins and increased backlog and revenue contributions. During the first quarter, our autonomous systems segment contributed $346 million, or 72% of the total company revenue, while our space, cyber, and directed energy segment contributed $134.5 million in revenue, or 28% of the total company revenue, consistent with our plans for the quarter. Both segments contributed to the 25% increase in funded backlog from the prior quarter, due to very strong order flow and several source-source wins. Our total funded backlog now stands at $1.5 billion. Strong contract wins across multiple programs in both segments, particularly in counter UAS, positions us for a record fiscal year 2027 and supports our progress towards long-term growth goals. I would like to now walk you through some significant achievements since our last earnings call in each of our four main product areas, which are multi-mission ISR, precision strike, counter UAS, and space and advanced technologies. Starting first with our multi-mission ISR product area. As we had mentioned on our last call, AB's P550 was selected for the U.S. Army's Long Range Reconnaissance Program at the beginning of the first quarter, with an award of $117 million. Successful integration into the U.S. Army's Next Generation Command and Control System, or MGC-2, and strong performance during recent field tests positioned the P550 as another key franchise program expected to drive future growth. We anticipate the LRR program to be a $1 billion program over the next few years. Also during the quarter, AV was awarded a $30 million contract to deliver Puma AE and Puma LE systems for Germany's LARUS airborne reconnaissance program.