Fortrea Holdings Inc.

Thank you for standing by and welcome to Fortria's third quarter 2026 earnings conference call. Currently, 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 11 on your telephone. To remove yourself from the queue, you may press star 11 again. I would now like to hand the call over to Tracy Krumme, Senior Vice President of Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and welcome to Fortria's third quarter 2026 earnings conference call. With me today on the call are Anshul Thakral, Chief Executive Officer, and Jason Knoblauch, Chief Financial Officer. Before we begin, please note this call is being webcast. There is an accompanying slide presentation which can be found on the investor relations section of our website for TRIA.com. During this call, we'll make certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to significant risks and uncertainties that could cause actual results to differ materially from our current expectations. We strongly encourage you to review the reports filed with the SEC regarding these risks and uncertainties, and particularly those that are described in the cautionary statement concerning forward-looking statements and risk factors in our press release and presentation, which are posted on our website. Please note that any forward-looking statements represent our views as of today, October 29, 2026, and that we assume no obligation to update the forward-looking statements, even if estimates change. During this call, we will also be referring to certain non-GAAP financial measures. These non-GAAP measures are not superior to nor a replacement for the comparable GAAP measures, but we believe these measures provide investors with a more complete understanding of results. A reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures is available in the earnings press release and the presentation slides that are provided in connection with today's call. Lastly, I would also like to note that Anshul, Jason, and I will be participating in the Jefferies Global Healthcare Conference in London on November 17th. A live webcast and replay of our fireside chat will be available on the investor relations section of our website. Investors interested in meeting with us at the conference should contact their Jefferies representative or reach out to me directly. With that, I'd like to turn the call over to Anshul, Chief Executive Officer. Please go ahead.

Thank you, Tracy. Good morning, everyone, and thank you for joining us to discuss our third quarter 2026 results. Before we start, I'd like to formally introduce our Chief Financial Officer, Jason Knoblauch, who many of you have already met. Jason has quickly made a strong contribution to Fortria and I'm confident his leadership and experience will help shape our journey in the near and longer term. Turning to our performance, we are pleased to report another quarter of progress on our return to growth strategy, which is focused on revenue growth and margin expansion. Our third quarter results reflect continued execution across our three pillars, commercial excellence, operational excellence and financial excellence. They also reflect an important evolution for Fortrea as we focus on the next chapter of our journey, translating improved demand, stronger execution, and disciplined investment into sustainable, profitable growth. For the third quarter, we delivered revenue of $691.5 million, adjusted EBITDA of $58 million, and Net New Business Awards of $773 million resulting in a book-to-bill ratio of 1.12 times and a trailing 12-month book-to-bill ratio of 1.12 times. We delivered a strong third quarter reflecting continued progress against our strategic priorities. With continued execution against those priorities, We raised the midpoint of our full year revenue and adjusted EBITDA guidance while narrowing both ranges. We also recently completed our acquisition of the early phase services business from worldwide clinical trials, expanding our clinical pharmacology capacity, bringing our total beds across the US and UK to more than 570 and adding dedicated bioanalytical and safety lab capabilities. This strategic investment strengthens our early clinical development platform, enhances our ability to deliver integrated solutions to customers and supports our long-term growth strategy. Our progress this quarter reflects the work we've done to expand our commercial pipeline, strengthen operational execution and improve financial performance. Our focus is clear, expand our opportunity set, execute with greater consistency, and build a model that creates meaningful operating leverage as growth returns. I will now walk through our progress against each of these three pillars of excellence. Let's start with commercial excellence. Our progress is becoming more repeatable and process-driven. Over the past year, We've enhanced our commercial capabilities by focusing on talent, analytical tools, and integrated account management. Our tailored and flexible offerings resonate with customers. Fortrea can operate across multiple service models, which is an advantage as sponsors want providers capable of combining FSO, FSP, and point solutions, rather than forcing customers into a single operating model. Our ability to be agile in providing tailored solutions means we can be a strong partner to innovative large pharma and smaller biotech companies. I remain pleased with the balanced mix of business that we are winning across therapeutic areas, customer types, and geography. Our strategy remains grounded in the three Rs, reach, relevance, and repeat. Reach means increasing the aperture of our customer relationships and opportunities. Relevance means bringing differentiated scientific, regulatory, therapeutic, and operational expertise into the process earlier. Repeat means earning follow-on work by delivering consistently and creating a better client experience. We're seeing progress across each dimension. We're expanding our reach and generating more demand. With the value of our pipeline increasing both sequentially and year over year, the breadth of activity is important. It shows that Fortria is competing at a stronger position across a broader customer set. China is another important area of opportunity. China continues to be a meaningful source of innovation within the global drug development ecosystem. We're seeing Chinese biotech companies and global sponsors that are partnering with Chinese innovators seek experienced partners to advance differentiated assets into global development. We appointed a new leader in China over the summer with a mandate to leverage our strong position and drive growth with both China-headquartered biotechs and multinationals. Stepping back, I would characterize our commercial position this way. The market is becoming more supportive, but our progress is not simply a function of market recovery. It reflects deliberate changes to our go-to-market model, a sharper focus of where Fortrea can differentiate, and greater coordination across our teams. Now, we still have work to do, but the quality and the breadth of our pipeline gives us confidence that we're building a stronger foundation for growth. Our second pillar is operational excellence. In the services business, as I have said before, consistency is paramount. Clients judge us not only by our ideas or scale, but really by our ability to execute. We remain focused on improving delivery across the areas that matter most. Project management, site activation, enrollment, quality, and predictability, just to mention a few. These represent The daily discipline required to turn backlog into revenue, protect margins, and earn repeat business. Clinical pharmacology continues to be an important example of differentiated execution for Fortrea. Our business benefits from strong scientific capabilities, an integrated global network, and demand for studies that typically convert to revenue more quickly than later stage programs. We remain focused on building on our leadership position through targeted investment. We recently closed on our acquisition of the early phase services business from Worldwide Clinical Trials. This transaction is strategically important and signifies our growing confidence as we invest opportunistically for growth. Last week, I had a chance to visit our new sites in San Antonio and Austin, Texas. and welcome our new colleagues. The feedback from clients has been very positive in terms of the added capacity and added capabilities. Our bioanalytical laboratory in Austin allows us to perform testing in-house rather than relying on third parties. Our clients have been asking for this capability as part of our solutions and now we can deliver it for them. This in-house capability also gives us Our new 200-bed San Antonio facility that includes a safety laboratory combined with our Dallas unit creates a 300-bed Texas network and expands our ability to conduct larger bioequivalence and high-capacity studies. Across the global network, the transaction means that Fortrea now has more than 570 beds, adding to the scale and speed of our integrated early phase offering. Technology is another important enabler of operational excellence. We launched Fortrea Intelligent Technology, or FIT, earlier this year. It combines our data foundation and accelerated platform with analytics Machine Learning, Risk Intelligence, and AI, embedding intelligence into workflows our colleagues use to deliver clinical trials. We're delighted to be shortlisted for Best Use of AI in Clinical Development and Trial Innovation in the Scripps Awards 2026. Our approach is pragmatic, outcomes-focused, and responsible, and we continue to make good progress in its adoption. We are developing FIT intentionally module by module, workflow by workflow, persona by persona. Our CRA mobile app is now deployed across more than 49 countries and early data points indicate that it's delivering greater monitoring efficiency, creating capacity for higher value, quality focused site management. These tools do not replace accountability or judgment. They help our people prepare more effectively identify risks earlier and work with greater consistency. As I have said before, our goal with AI is not automation for the sake of automation. It is to create a force multiplier for our people and our clients. Automation can improve efficiency. Judgment improves outcomes. Our strategy brings the two together with appropriate human leadership in a highly regulated environment. That is also the purpose of a unique internal program that we call Felix. We launched Felix over the summer, connecting AI literacy, practical adoption, and measurable value. Felix combines self-paced learning, instructor-led sessions, and role-specific support. Employees can earn belts at different levels that equip them to use AI responsibly and confidently based on their role. It's making an immediate impact. For example, more than 95% of our colleagues have integrated AI into their weekly routines. We're confident that we're creating a strong platform of AI literacy and adoption at scale. We're now turning our focus to value realization, embedding AI into priority workflows and managing outcomes through consistent KPI cadence. At the same time that we're enabling our employees, we also have taken the approach of having our employees enable Fortrea's growth through innovation. This year, we staged three Grassroot Innovation Hackathons. These events were held across different regions. Together, these enterprise-led and colleague-led initiatives strengthened how we deliver today while building capabilities that can improve productivity, predictability, and client experience over time. Now, let me turn to our third pillar, financial excellence. Jason will discuss this quarter's financial performance, cash flow, balance sheet, and outlook in greater detail, including the adjustment we made to our reported backlog. We believe this was an appropriate step and Jason will provide additional context shortly We continue to operate the business with financial rigor. The major actions to better align our cost structure with the scale of the business are largely complete. While we will continue to identify opportunities to operate more efficiently, our focus is increasingly on transforming how we work as a global team to drive sustainable growth and margin expansion. Looking ahead, we expect margin expansion to be increasingly driven by revenue growth, favorable business mix, improved utilization, and operating leverage. Mix matters. Our objective is not to grow at any cost. It is profitable growth built on work where Fortria can deliver differentiated value. Our infrastructure is positioned to support additional growth without requiring non-billable costs to increase at the same rate. As we have discussed, low single digit service fee revenue growth should begin to produce incremental drop through. As growth moves towards the mid single digit operating leverage should become even more apparent. That is central to our objective of reaching mid teens adjusted EBITDA margins. Our continued progress in disciplined execution are reflected in our updated full year outlook. We narrowed our full year revenue and adjusted EBITDA guidance ranges and raised the midpoint of both. We continue to manage costs carefully while investing with discipline to support growth and margin expansion. We also remain focused on the balance sheet and capital allocation, and we continue to expect positive free cash flow in the fourth quarter and for the full year. Our capital allocation priorities remain focused on investing for organic growth, improving productivity, and continuing to deliver while pursuing targeted opportunities that strengthen capabilities and meet disciplined return thresholds. As we look ahead, I want to leave you with three key points. First, our commercial opportunity set continues to expand. The market environment is improving. Our pipeline is broader and stronger than it has ever been, and our go-to-market investments are opening doors across large pharma, biotech, China to global innovators, and new to Fortria clients. We're now competing from a stronger position. Second, operational execution is strengthening the foundation for profitable growth. We've remained focused on quality, predictability, and client delivery while investing selectively in clinical pharmacology, fit, AI literacy, and colleague-led innovation. These capabilities are intended to help our teams work with greater speed, consistency, and insight. Third, financial discipline remains central to our strategy. With the major cost actions largely complete, our focus is increasingly on converting stronger demand and bookings into service fee revenue growth, improving mix and utilization, and capturing the operating leverage embedded in our model. Most importantly, none of this progress would be possible without our colleagues around the world. As we prepare for what's ahead, we're committed to humans in the lead. experience, agility, and dedication of our people are the foundation of our client and site relationships, of our quality, and of our ability to innovate. We're asking a great deal of the organization as we return to growth, and our teams continue to respond with commitment, accountability, and energy. Jason, I'll turn the call over to you to discuss our third quarter financial results in more detail.