Elbit Systems Ltd.

Ladies and gentlemen, thank you for standing by. Welcome to LB Systems' first quarter 2026 results conference call. Our participants are present in listen-only mode. Following management's formal presentation, instructions will be given for the question and answer session. As a reminder, this conference is being recorded. I would now like to hand over the call to Daniela Fink, LB Systems VP Investor Relations. Daniela, please go ahead.

Thank you Hila. Hello everyone and welcome to our first quarter 2026 earnings call. On the call with me today are Butsy Maslis, President and CEO, Toby Kagan, CFO and myself Daniela from Investor Relations. Before we begin I would like to point out that the safe harbour statement in the company's press release issued earlier today also refers to the contents of this conference call. I would like to remind all listeners that the conference call today may contain forward-looking statements regarding the company and its subsidiary's business. Actual search results may differ materially from these forward-looking statements. As usual, we will provide you with both GAAP financial data as well as certain supplemental non-GAAP information. We believe that this non-GAAP information provides additional transparency to better understand the performance of the ongoing business. You can find all the detailed GAAP financial data as well as the non-GAAP information and the reconciliation in today's press release. Kobi will begin by discussing the financial results, followed by Budsi, who will elaborate on the main events during the quarter and beyond. We will then turn the call over to a Q&A session. With that, I would like to now turn the call over to Kobi. Kobi, please go ahead.

Thank you, Daniela. Hello, everyone, and thank you for joining us today. We are pleased to report another strong quarter delivering double-digit growth in revenues, operating profit, and EPS. Our backlog reached a new record surpassing $30 billion for the first time, and we exceeded a 10% non-GAAP operating margin in line with our internal targets. These results reflect the strength of our execution and the outstanding performance of our global teams. Taking a closer look into the first quarter results, first quarter revenues increased by 15.5% to $2,189,000,000 compared to $1,896,000,000 in the first quarter of 2025. This is the first quarter revenues were higher than those of the preceding fourth quarter, representing the strong demand we are witnessing from our key markets. For the first quarter of 2026, Europe contributed 23% of revenues, North America 20%, Asia Pacific 16%, and Israel contributed 37% of revenues. Europe continues to be a meaningful growth engine The shift in Europe is profound, and we are seeing strengthening demand trends. In terms of quarterly revenues by segment, C4I and cyber revenues increased by 17% in the first quarter of 2026, as compared to the first quarter of 2025, mainly due to sales of radio systems and command and control system sales in Europe. ISO and EW revenues increased by 17%, mainly due to increased sale of airborne high-power laser and electronic warfare systems. Land revenues increased by 27%, mainly to ammunition and munition sales in Israel and Europe. Helmet systems of America revenues increased by 5%, mainly due to the increase in sales of night vision system, which were partially offset by a decrease in sales of medical devices. Aerospace revenues increased by 2% in the first quarter of 2026 as compared to the first quarter of 2025, mainly due to project mix. GAAP gross margin in the first quarter was 25.2% of revenues compared to 24% in the first quarter of 2025. Non-GAAP gross margin for the first quarter was 25.5% compared to the first quarter of 2025 at 24.3%. Gross margins have expanded due to scale and product mix. Gap operating income in the first quarter was $205.1 million or 9.4% of revenues as compared to $149.7 million or 7.9% of revenues in the first quarter of 2025. non-GAAP operating income was $222 million, or 10.1% of revenues in the first quarter of 2026, as compared to $165.1 million, or 8.7% of revenues in the first quarter of 2025. The operating expense breakdown for the first quarter of 2026 was as follows. Net IRD expenses were $150.4 million or 6.9% of revenues as compared to $114.3 million or 6.1% of revenues in the first quarter of 2025. LBIT continues to prioritize investment in advanced R&D initiatives including AI capabilities to support sustainable profitable growth and strengthen our leadership position in the years ahead. Elbit is focusing its R&D on cutting-edge battlefield technologies. Key initiatives include counter-UAS solutions spearheaded by higher-power laser, advanced autonomous airborne, naval and land platforms, multispectral sensing, and advanced precision and standoff munitions. Marketing and selling expenses were $100.9 million, or 4.6% of revenues in the first quarter of 2026. to $100.9 million or 5.3% of revenues in the first quarter of 2025. G&A expenses were $95.7 million or 4.3% of revenues in the first quarter of 2026 as compared to $89.4 million or 4.7% of revenues in the same period last year. Financial expenses were $32.2 million in the first quarter of 2026 as compared to $39 million in the first quarter of 2025. The decrease in financial expenses in the first quarter of 2026 was mainly due to a reduction in the average debt. Taxes on income were $22.8 million in the first quarter of 2026 as compared to $16.1 million in the first quarter of 2025. The effective tax rate in the first quarter of 2026 was 13% compared to 13.9% in the first quarter of 2025. Gap diluted EPS for the first quarter of 2026 was $3.34, up 42% as compared to $2.35 in the first quarter of 2025. Our non-GAAP diluted EPS was $3.87 in the first quarter of 2026, up 51% as compared to $2.57 in the first quarter of 2025. Our backlog of orders as of March 31st, 2026 was $30.2 billion, more than $7 billion higher than the backlog at the end of March 31st, 2025. Approximately 71% of the current backlog was generated from outside of Israel. Approximately 49% of the backlog at the end of March is scheduled to be performed during the remainder of 2026 and in 2027, while the rest is scheduled to be performed during 2028 and beyond. The increase in backlog during the quarter came mainly from Israel. Net cash provided by operating activities in the quarter was $281 million as compared to $184 million in the quarter ended March 31st, 2025. Cash flow in the first quarter of 2026 was affected mainly by the strong increase in net income and an increase in contract liabilities. During the first quarter of 2026 we delivered $210 million of free cash flow, up 30% from $161 million free cash flow generated in the first quarter of 2025. The board of directors has declared a dividend of $1 per share to be paid on July 6th, 2026. I will now turn the call over to Mr. Maklis, I'll be presenting the CEO. Bootsy, please go ahead.