Financial Data and Key Metrics Changes - Third Quarter 2025 revenues were $1,922 million, a 12% increase from $1,718 million in the Third Quarter of 2024, with 18% growth for the nine months ended September 30 [4][10] - GAAP gross margin improved to 24.9% in the Third Quarter from 24% in the same quarter last year, while non-GAAP gross margin rose to 25.2% from 24.4% [5][8] - GAAP diluted EPS increased to $2.80 from $1.77 year-over-year, and non-GAAP diluted EPS rose to $3.35 from $2.21 [8] Business Line Data and Key Metrics Changes - Aerospace segment revenues decreased by 3% year-over-year, primarily due to lower precision-guided munitions sales in Asia-Pacific, offset by increases in Israel and Europe [8] - SIFRAE and CYBER revenues increased by 14% year-over-year, driven by sales in Europe [9] - Land segment revenues surged by 41% in the third quarter, attributed to ammunition and munitions sales in Israel and Europe [9] Market Data and Key Metrics Changes - Revenue contributions for the Third Quarter 2025 were as follows: Europe 28%, North America 21%, Asia-Pacific 14%, and Israel 33% [4] - The order backlog as of September 30, 2025, was $25.2 billion, an increase of $3.1 billion from the same quarter last year [10] Company Strategy and Development Direction - The company aims to focus on growth outside of Israel, particularly in Europe, as indicated by a backlog increase of $1.2 billion from international orders [22] - Elbit Systems is expanding its operations in Europe with new facilities in Sweden and Germany to enhance local delivery capabilities [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued growth driven by strong demand for solutions, particularly in Europe and Israel, amidst rising global defense budgets [11] - The company anticipates that the ceasefire will allow for a return to normal business operations and potentially more opportunities for new business [36] Other Important Information - The Board of Directors declared a dividend of $0.75 per share to be paid on January 5, 2026, reflecting the company's strong financial performance [10] - Elbit signed a significant international contract worth approximately $2.3 billion, marking the largest contract in the company's history [12] Q&A Session Summary Question: How enduring is domestic demand with the ceasefire? - Management noted an increase in backlog, with $200 million in Israel and $1.2 billion outside Israel, indicating a focus on growth outside Israel, especially in Europe [22] Question: What is the outlook for the air and aerospace business? - Management expects continued growth in the aerospace segment, driven by international sales and demand for UAVs [25][26] Question: Are there opportunities in directed energy solutions? - Management confirmed significant interest in high-powered laser systems, with potential orders expected based on success in Israel [28][30] Question: What are the drivers behind the strong margin performance? - The margin expansion is attributed to improved backlog profitability and operational excellence initiatives, including AI utilization [34][35] Question: Any updates on profitability targets for 2026? - Management refrained from providing specific targets but emphasized ongoing efforts to improve profitability and cash conversion [40] Question: How does Elbit plan to leverage the US DOD's budget expansion? - Management highlighted the strategic importance of the US market and ongoing exploration of acquisition opportunities [41][42]

Financial Data and Key Metrics Changes - Second quarter revenue increased by 10% sequentially and 2% year over year, marking the first year-over-year revenue increase since 2022, driven by modest demand improvement across multiple markets [5][18] - Revenue for the quarter was $251 million, with a gross margin of 37.3%, remaining flat year over year [22][23] - Adjusted earnings per diluted share were $0.30, exceeding guidance [24][27] Business Line Data and Key Metrics Changes - Revenue from materials processing decreased by 6% year over year due to divestitures and lower sales in cutting, welding, and additive manufacturing, partially offset by higher revenue in micromachining and the Clean Laser acquisition [18][19] - Medical and advanced applications revenue increased by 21%, driven by higher sales in these segments [18] - Emerging growth products accounted for 54% of sales, indicating strong performance in various laser sources and systems [20] Market Data and Key Metrics Changes - North America sales increased by 31% sequentially but were down 4% year over year, primarily due to higher sales in medical and advanced applications [20] - European sales were stable with less than a 1% sequential decline and down 11% year over year, impacted by lower cutting and welding sales [20] - Asia saw a 4% sequential increase and a 14% year-over-year increase, benefiting from higher sales in welding and cutting, as well as advanced applications [21] Company Strategy and Development Direction - The company is targeting a $5 billion total addressable market (TAM) with strategic initiatives aimed at driving profitable growth [5] - Focus on developing innovative lasers and photonic solutions for medical, micromachining, and advanced applications, with significant progress reported in these areas [9][11] - Capital allocation strategy emphasizes organic growth investments and strategic M&A, with plans to spend approximately $100 million on CapEx in 2025 [12][25] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding demand stabilization, noting improvements in industrial production and inventory normalization among customers [16][46] - The company is adapting to tariff-related challenges by leveraging supply chain flexibility and has successfully mitigated potential delays in customer orders [15][17] - Future guidance anticipates revenue between $225 million and $255 million for 2025, with adjusted gross margins between 36% and 38% [26][27] Other Important Information - The company repurchased $30 million of its stock during the quarter, continuing a trend of returning cash to shareholders [12][25] - The Crossbow laser counter UAV solution has been delivered to Lockheed Martin, showcasing the company's capabilities in directed energy systems [9][10] Q&A Session Summary Question: Can you provide any color on book to bill by region? - Management indicated that the book to bill ratio was approximately one across all regions, which is a positive sign [30][32] Question: How do you view the opportunity for directed energy over the next few years? - Management highlighted the directed energy market as a significant growth area, particularly addressing threats from smaller drones, with ongoing partnerships and extensive testing [34][37] Question: Can you walk us through the Q3 guidance? - Management noted that they were able to ship a significant portion of anticipated orders due to effective tariff mitigation strategies and observed broad-based improvements in demand [42][46] Question: What is the outlook for the systems business? - Management expressed excitement about the Clean Laser acquisition and noted improvements in other systems areas, including micro machining and robotic systems [63][65] Question: How is the competitive environment in the medical business changing? - Management reported strong positioning in the urology market and continued growth with new customer acquisitions [66][68]

Company Overview - AeroVironment (AV) has a pro forma adjusted revenue of approximately $2 billion in FY26 [8] - The company's market capitalization is $8 billion as of May 31, 2025 [10] - AV has fielded over 42,000 platforms in demanding environments [7] - AV sells to over 100 countries [9] Strategic Positioning and Growth - AV's total addressable market exceeds $50 billion [23] - The U S DoD is pushing for $150 billion in additional spending [22, 26] - No single area is expected to contribute more than 30% of FY26 pro-forma revenue [30] Innovation and Technology - Nearly $3 billion has been invested in hardware and software over the past decade [21, 31] - AV has delivered over 40,000 units, continually refined through operational feedback [31] BlueHalo Acquisition - The acquisition of BlueHalo closed on May 1, 2025 [13] - The acquisition is expected to be accretive to Revenue, Adjusted EBITDA, and non-GAAP EPS in the first full year post-close [16] Cost Advantage - Ukraine has fired approximately $36 million worth of Switchblade 600 munitions to destroy over $2.5 billion worth of enemy equipment [67]