NetScout Systems, Inc.

Gentlemen, thank you for standing by, and welcome to NETSCOUT's second quarter fiscal year 2026 financial results conference call. At this time, all parties are in a listen-only mode until the question and answer portion of the call. As a reminder, this call is being recorded. Scott Dressel, AVP Corporate Finance, and his colleagues at NETSCOUT are on the line with us today. If you require operator assistance at any time, please press star zero. I would now like to turn the call over to Scott Dressel to begin the company's prepared remarks.

Thank you, operator, and good morning, everyone. Welcome to NETSCOUT's second quarter fiscal year 2026 conference call for the period ended September 30th, 2025. Joining me today are Anil Singhal, NETSCOUT's president and chief executive officer, and Tony Piazza, NETSCOUT's executive vice president and chief financial officer. There is a slide presentation that accompanies our prepared remarks. You can advance the slides in the webcast viewer to follow our commentary. Both the slides and the prepared remarks can be accessed in multiple areas within the investor relations section of our website at www.netscap.com, including the IR landing page under financial results, the webcast itself, and under financial information on the quarterly results page. As discussed in detail on slide number three, Today's conference call will include certain forward-looking statements about NETSCOT's views on expected results of future performance and business strategy. These statements speak only as of today's date and involve risks, uncertainties, and assumptions that may cause actual results to differ materially, including but not limited to those described in the company's most recent annual report on Form 10-K and subsequent trialings with the Securities and Exchange Commission. As discussed in detail on slide number four, today's conference call will also include discussion of certain non-GAAP financial measures that the company believes to be useful to investors. While this slide presentation includes both GAAP and non-GAAP results, other than the revenue and balance sheet information, we will focus our discussion on non-GAAP financial information. should not be considered in isolation from or as a substitute for financial information prepared in accordance with GAAP. Reconciliations of all non-GAAP metrics to the nearest GAAP measures are provided in the appendix of the slide presentation in today's financial results press release and on our website. I will now turn the call over to Anil for his prepared remarks.

Thank you, Scott, and good morning, everyone. Thank you for joining us today. We delivered another solid quarter in Q2, driven by revenue growth from both our cybersecurity and service assurance product lines, as we continue to advance our strategic initiatives, including AI-driven product innovation. Our strong top and bottom line performance also benefited from the acceleration of some orders originally anticipated in the second half of the fiscal year. Given our strong first half performance, we are raising our revenue and earning per share outlook, which Tony will detail in this financial review. Let's turn to slide number six for a brief recap of our financial results for the second quarter and the first half of fiscal year 2026. Revenue was approximately $219 million, representing an increase of nearly 15% year-over-year driven by solid growth in both our cybersecurity and service assurance areas of our business, along with the acceleration of certain orders originally anticipated to occur in our second half. We expanded both our gross and operating margins during the quarter and delivered diluted earnings per share of $0.62, an increase of approximately 32% year over year. For the first half of the fiscal year, or the six months ended September 30th, revenue was approximately $406 million, an increase in approximately 11% year-over-year, which benefits from a solid growth in both cybersecurity and service assurance area for business, along with the previously mentioned acceleration of certain orders. We expanded both our gross and operating margins during the first half of the fiscal year and delivered diluted earnings per share of $0.95, an increase of approximately 27% year-over-year. Now let's turn to slide number seven for some perspective in our business and some market insights. Starting with our service assurance offering, revenue in first half of the fiscal year increased approximately 10% year over year, driven by growth from both our enterprise and service provider customer verticals. We achieved solid growth across most of our major enterprise sectors, with the federal government being particularly strong in the first half. This sector benefited from both underlying demand and the acceleration of certain orders expected in the second half. In the service provider area, growth was largely attributable to the timing of maintenance renewals, including back maintenance that process in Q2 versus Q3 in the prior year. Our enterprise customers are continuing to invest in digital transformation initiatives related to enhanced visibility, observability, and AIOps initiatives. Accordingly, we are driving intelligence into observability and AIOps to feed the need for actionable telemetry derived from wire data and to leverage the unmatched power of our scalable DPI and metadata technology. We also recently launched our Omnis ClearSight sensor for Kubernetes which provides comprehensive observability within the complex cloud environment. It delivers deep, actionable, and real-time insights into the system performance, health, and cost drivers. The solution reflects our vision of visibility without borders and is specifically designed to support dynamic and distributed architectures, which are challenging environments to monitor due to their encrypted nature. On the service provider side, Domestic and international carriers continue to align their investments with clearly defined 5G monetization opportunities such as fixed wireless access and private 5G. Although the service provider space remains challenging, we remain optimistic that NETSCOUT can capture further opportunities by delivering differentiated value as we continue to navigate the current environment. For example, we recently announced solutions to support cable providers and multiple service operators, or MSOs, with Omnis AI Insights, which generates a high-fidelity curated data set to provide real-time network visibility, ensuring a high-quality user experience for video streaming and over-the-top services to help MSOs deliver high-quality user experiences more cost-effectively. Moving to our cybersecurity offering, revenue in the first half increased nearly 13% year-over-year, driven by growth in both our enterprise and service wider customer verticals. Organizations continue to prioritize this area as they seek to protect themselves against an increasingly complex and expanding cyber threat landscape. In late August, we released our latest research detailing the evolving distributed denial of service landscape and how such attacks can destabilize critical infrastructure. Just in the first half of this year, activist groups launched hundreds of coordinated attacks each month targeting communication, transportation, energy, and defense systems. What is particularly concerning is how DDOTS for Hired Services has made sophisticated attack tools available to virtually anyone. These attacks now use AI-enhanced automation, multi-vector approaches, and carpet bombing techniques that overwhelm traditional defenses. Botnets are compromising tens of thousands of IoT devices, servers, and routers to deliver sustained attacks that cause real disruption and are creating an unprecedented level of cyber risk for organizations and service provider networks. NETSCORE solutions are designed to mitigate this risk by leveraging our unparalleled visibility into global attack trends. Moving on to customer wins. Our solution continues to gain traction with customers seeking to enhance their visibility, observability, and cybersecurity capabilities, leading to combined solution wins across our service assurance and cybersecurity offerings within customer orders. Highlights for the second quarter include an enterprise deal with multiple orders totaling an amount in the eight-figure range, part of which we received earlier than anticipated, related to a U.S. government agency that we have been a loyal and long-standing user of our solution. These orders are follow-on orders from orders received last quarter and consist of both service-assured and cybersecurity solutions, including our new AI and cyber intelligence products. This user values our solution for the smart data we provide, which they are leveraging to enhance their user experiences and support AI-driven operations and initiatives as they modernize their technology environment. Additionally, in the service provider area, we won a low seven-figure deal with a major U.S. telecommunication company that's another loyal and longstanding customer. This deal included our adaptive DDoS and distributed TMS cybersecurity solutions that the customer opted to purchase on a subscription basis. The cybersecurity solution purchase are designed to defend against the kind of carpet bombing DDoS attacks that recently targeted a large number of high-profile platforms. The deal also included solutions from our service assurance offerings related to the customer's 5G expansion. The cybersecurity and service assurance purchases were implemented to improve the subscriber's user experience and to reduce churn among their 5G and Wi-Fi customers. In all, these developments reflect our momentum in executing our long-term strategy. With that, let's move to slide number eight to review our outlook. Looking ahead, we remain focused on driving product innovation, returning to annual revenue growth, and enhancing our margin through disciplined cost management. Accordingly, based on our strong first-half performance and our pipeline of opportunities, we are raising our revenue and earnings per share outlook. Tony will provide more details on the outlook in his remarks. As we navigate the second half of the fiscal year, we will continue monitoring the uncertain macro environment while remaining motivated by strong and positive customer feedback, including at our recent annual Engage Technology and User Summit. We hosted this event in September and showcased our latest solution focused on observability, AIOps, and cybersecurity. It is clear that our customers rely on our highly curated data to drive improved business outcomes across all ecosystems, which we believe positions us well to capture new opportunities through our differentiated solutions. As always, we are committed to empowering our customers to meet the demands of today's complex digital landscape by delivering mission-critical solutions that address performance, ensure availability, and safeguard security. We look forward to sharing our progress with you throughout the remainder of our fiscal year. With that, I will turn the call over to Tony.