Booz Allen Hamilton Holding Corporation

Good morning, and thank you for standing by. Welcome to the Booth Allen Hamilton's earnings call covering first quarter fiscal year 2026 results. At this time, all participants are in a listen-only mode. Later, there will be an opportunity for questions. I'd now like to turn the call over to the head of investor relations, Dustin Terrensberg.

Thank you. Good morning, and thank you for joining us for Booth Allen's first quarter fiscal year 2026 earnings call. We hope you've had an opportunity to read the press release we issued earlier this morning. We have also provided presentation slides on our website and are now on slide two. With me today to talk about our business and financial results are Horacio Rozanski, our Chairman, Chief Executive Officer and President, Matt Calderon, Executive Vice President and Chief Financial Officer, and Christine Martin-Anderson, Executive Vice President and Chief Operating Officer. As shown in the disclaimer on slide three, Please note that we may make forward-looking statements on today's call, which involve known and unknown risk, uncertainties, and other factors that may cause our actual results to differ materially from the forecasted results discussed in our SEC filings and on this call. All forward-looking statements are expressly qualified in their entirety by the foregoing cautionary statements and speak only as of the date made. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements. During today's call, we will also discuss some non-GAAP financial measures and other metrics, which we believe provide useful information for investors. We include an explanation of adjustments and other reconciliations of our non-GAAP measures to the most comparable GAAP measures in our first quarter fiscal year 2026 earnings release and slides. Numbers presented may be rounded, and as such, may vary slightly from those in our public disclosures. It is now my pleasure to turn the call over to our Chairman, CEO, and President, Rossi Rozanski. We're now on slide four. Thank you, Dustin.

Welcome, everyone, and thank you for joining the call. Today, Christine, Matt, and I will share our financial results for the first quarter of fiscal year 2026. The headline for today is that our first quarter performance played out as we expected. Matt will go deeper into our first quarter results in a few minutes. Ahead of that, I would like to frame our results in the context of the current environment and describe how we are accelerating our transformation to take advantage of the next inflection point. As I've said previously, all presidential transitions create some degree of near-term disruption followed by opportunity. The administration is driving fast change, and six months in, the government is still adapting. Agencies are realigning their priorities and, in many cases, restructuring their own operations. We see overall demand strengthening, but near-term funding continues to move slowly through the procurement environment. While the overall tenor is more positive than it was weeks ago, this adjustment period is still underway. and some uncertainty remains as submissions and contracts are still being reviewed. Our quarterly results reflect these dynamics. Top and bottom line performance matched our expectations, with the brightest spots being booked to bill and the resulting record backlog. As we look forward, we expect the full effects of the civil sector reset to manifest in our Q2 financials, and intend to return to growth in the back half of this year. Our teams are all in, working with mission owners to ensure that as funding solidifies, Booz Allen can accelerate. As we look ahead, we are moving forward aggressively. We are meeting with senior administration officials and with customers at all levels. Our technology-based approach resonates loudly with their agendas. They see opportunity to invest in technology, from AI to cyber to quantum, to drive both cost efficiency and mission effectiveness. And these discussions have reaffirmed my optimism about the medium and long term. Our Volt strategy, which stands for Velocity, Leadership, and Technology, and especially our unique investments and positioning in the technology ecosystem, are among our key differentiators. Having the mission insights to adapt and deploy commercial technology at speed and scale are differentiators for us as well. Other companies can do this too, of course, but none as well as Booz Allen. We hear this from customers and from technology partners regularly. So we are using this moment of rapid market transition to move faster ourselves. I believe we are on track to shave years off our transformation timeline. To drive that acceleration, we are focusing relentlessly on the five priorities I outlined in May. Allow me to summarize that progress. First, we have restructured and reset our civil business in alignment with the existing demand environment. In the first quarter, we acted quickly to right-size our talent, optimize the business, and adapt to short-term challenges. Now we are focused on returning to growth by capturing opportunities in priority missions. One example is modernization, which we know is important to civilian agencies and across government. In May, we were awarded the $51 million task order with Customs and Border Protection or CBP. Through this work, we are using our technologies and partnership with AWS to help CBP move to the cloud. This is a meaningful opportunity to inject new tech into a high priority mission and potentially expand as opportunities arise. Second, we are reimagining how we deliver our work to prepare for a shift to outcome-based opportunities. We believe this shift will enable greater innovation and generate cost savings for the government. For example, Thunderdome is our proven zero-trust solution for DoD, and we are in the process of expanding its customer base and transitioning parts of it to be outcome-based. Thunderdome is an ideal candidate because it has clearly defined mission outcomes, such as quickly advancing the department's zero trust architecture goals. We are very proud of the outcomes we've delivered. We met all of these zero trust standards more than two years ahead of schedule. Third, we are directing resources to the areas that will best position us for growth. Our defense technology group is a great example. Back in April, we consolidated these activities into one team to focus on an area that is primed for growth. This group is dedicated to rapidly injecting advanced technologies into defense missions that protect and empower our nation's warfighters. Let me describe three examples of the momentum we have built. One, we have successfully deployed our modular detachment kit, or MDK, into live fire exercises and operations across Europe and Africa. This kit offers unprecedented multi-domain integration that bridges technological gaps by seamlessly fusing sensor and data link information. MDK is revolutionizing tactical command and control, giving our warfighters a clearer understanding of the battle space. Two, we have been building on our tactical assault kit which is a series of plugin-ready solutions that can be added to a mobile device and used in the field. We recently added two new tools, SIDX and GVStreamer, that help users communicate in real-time and livestream full-motion video. These unique capabilities have been successfully deployed in theater, as well as during hurricane relief efforts, the Super Bowl, and the presidential inauguration. And three, we were just awarded a new $315 million contract with the United States Air Force for our Tactical Operations Center Light Battle Management System prototype, or TOC-L. It's a major program of record in the Department of the Air Force's battle network, and it will accelerate information and decision superiority at the EDGE. we are going to deploy TOC-L to 70 locations around the world, including Europe and the Pacific. So taken all together, these are three examples of how we are growing our business while outfitting warfighters with the tech they need to stay safe, ready, and lethal. The fourth priority focuses on advancing our partnerships across the tech ecosystem. America needs to maintain global technological supremacy, and our nation's advanced technology ecosystem is the greatest innovation engine in the world. Booz Allen's leading role in this ecosystem is unique. From our partnerships with hyperscalers to our venture investments with startups, we are finding and co-creating next-generation technology and making it work. inside our nation's most important missions. In a moment, Matt will share more on how we are accelerating this priority. And finally, we are creating efficiencies in our own business so we can move faster and realize greater shareholder value even in a volatile environment. We are using AI-assisted tools to build software faster and reimagine our delivery. We're using AI and automation to run the business smartly and more efficiently. We're integrating commercial tech from other companies. And those companies are telling us that we are on the leading edge. We're not just generating speed to outcomes for our customers. We're also doing it for ourselves. In closing, These five priorities demonstrate how we are accelerating Booz Allen's transformation. From AI to cyber, to space and supporting our warfighters at the edge, Booz Allen is delivering solutions at the center of America's key missions. So I want to thank my colleagues for all that they do. I'm so inspired by them every day. And I'm grateful that our country has them on our side. Together, we are navigating this time of tremendous change and staying ready to help our nation move faster. And with that, Matt, over to you.