Core Viewpoint - Exponent, Inc. has declared a quarterly cash dividend of $0.30 per share, reflecting its commitment to shareholder value amidst macroeconomic challenges [1][3]. Dividend Information - The quarterly cash dividend of $0.30 per share will be paid on June 20, 2025, to shareholders of record as of June 6, 2025 [1]. - Exponent plans to continue paying quarterly dividends each year in March, June, September, and December, subject to the Board's final determination [2]. Company Strategy and Positioning - The company emphasizes its diversified services portfolio, which positions it to withstand short-term volatility while pursuing long-term growth opportunities [3]. - Exponent integrates over 90 technical disciplines and employs more than 950 consultants to address complex challenges across various industries [3][4]. Global Operations - Exponent's consultants leverage multidisciplinary expertise and resources from offices in North America, Asia, and Europe, enabling the delivery of high-value insights to clients [4].

Core Insights - Exponent, Inc. reported first quarter results for fiscal year 2025, showing resilience in its diversified business model despite challenges in the consumer electronics sector [2][4][9] Financial Performance - Total revenues for Q1 2025 were approximately flat at $145.5 million compared to $144.9 million in Q1 2024, while revenues before reimbursements were $137.4 million, slightly up from $137.2 million [4] - Net income decreased to $26.7 million, or $0.52 per diluted share, down from $30.1 million, or $0.59 per diluted share in the same period last year [5][22] - EBITDA fell to $37.5 million, representing 27.3% of net revenues, compared to $40.1 million, or 29.2% of net revenues in Q1 2024 [6][27] Business Segments - The engineering and other scientific segment accounted for 84% of revenues before reimbursements, remaining flat year-over-year, driven by demand in transportation and utilities [7] - The environmental and health segment represented 16% of revenues before reimbursements, with a 2% increase attributed to higher engagements in the chemicals industry [8] Business Outlook - Exponent anticipates low-single-digit revenue growth for the full fiscal year 2025, maintaining its guidance despite facing headwinds in the second quarter [9][17] - The company is returning to a 52-week fiscal year in 2025, which may impact full-year comparisons due to the previous year's 53-week benefit [10]

Financial Data and Key Metrics Changes - For Q4 2024, total revenues increased by 11% to $136.8 million, while net revenues rose by 9% to $123.8 million compared to the same period in 2023 [13] - Net income for Q4 was $23.6 million, or $0.46 per diluted share, up from $20.9 million, or $0.41 per diluted share in the prior year [13] - EBITDA for Q4 was $31.2 million, producing a margin of 25.2% of net revenues, compared to $30.5 million or 26.8% in the same period of 2023 [13][14] - For the full year 2024, total revenues increased by 4% to $558.5 million, and net revenues also increased by 4% to $518.5 million [18] - Net income for the year rose by 9% to $109 million, or $2.11 per diluted share [18] Business Line Data and Key Metrics Changes - The Engineering and Other Scientific segment represented 83% of revenues before reimbursements in Q4, with revenues increasing by 8% [23] - The Environmental and Health segment accounted for 17% of net revenues in Q4, with net revenues increasing by 11% [24] - Growth in the chemicals industry was noted, particularly in litigation and regulatory engagements [5][25] Market Data and Key Metrics Changes - Demand for proactive services strengthened in the second half of the year, particularly in consumer electronics and utilities [5] - The utility sector saw increased activity driven by asset integrity management and energy infrastructure projects [6][7] - The company is closely monitoring regulatory changes, particularly from the EPA and FDA, which could impact client engagements [8][9] Company Strategy and Development Direction - The company aims to align headcount growth with market opportunities, expecting sequential increases in 2025 [10][27] - Focus on technological advancements and their implications across industries, including energy, digital health, and transportation [10][11] - The company is positioned to support clients navigating a complex regulatory environment while pursuing long-term product strategies [9][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the near-term pipeline, particularly in the chemicals industry, despite a 5% to 6% deficit in headcount at the start of 2025 [37][38] - The company anticipates low single-digit revenue growth for Q1 2025, with expectations for growth in the latter half of the year [25][27] - Management highlighted the importance of sustainable recruiting aligned with demand to achieve long-term growth targets [56][57] Other Important Information - The company expects EBITDA margins for 2025 to be lower due to increased noncash expenses and other operational costs [26][30] - Capital expenditures for 2025 are projected to be between $10 million and $12 million [30] - The company plans to return to a 52-week fiscal year in 2025, which will affect revenue comparisons [25] Q&A Session Summary Question: Visibility on near-term pipeline and guidance conservatism - Management noted strong demand in the chemicals industry and expressed confidence in the pipeline, despite a tough comparison in Q1 2024 [36][37] Question: Performance and outlook of the energy infrastructure business - Management discussed robust performance in both proactive and reactive work within the energy sector, driven by increasing demand for new power sources [41][44] Question: Regulatory exposure and revenue percentage related to regulatory concerns - Approximately 10% of the company's work involves regulatory processes, with about half in the chemicals area, primarily international [50][52] Question: Opportunities for accelerating recruiting - Management emphasized the importance of aligning recruiting pace with demand, aiming for sustainable growth [54][56] Question: Size and growth of the chemicals business - The chemicals business represents a low double-digit percentage of overall revenue, with growth rates in the low to mid-teens for Q4 [61] Question: Impact of AI on the company - Management highlighted opportunities in AI for safety-critical decisions, while noting the scrutiny that AI data faces in legal settings [65][66]