Financial Data and Key Metrics Changes - Total revenues increased by 8% to $147.1 million, while net revenues rose by 10% to $137.1 million compared to the same period in 2024 [10] - Net income for the quarter increased to $28 million, or $0.55 per diluted share, compared to $26 million, or $0.50 per diluted share in the prior year [10] - EBITDA increased by 9% to $38.8 million, with a margin of 28.3% of net revenues, slightly down from 28.6% in the same period of 2024 [11] - Billable hours increased by 4% year-over-year to approximately 376,000 [11] - Utilization improved to 74.1%, up from 73.4% in the same period last year [12] Business Line Data and Key Metrics Changes - The engineering and other scientific segment represented 84% of net revenues, with a 10% increase driven by demand in risk management and asset integrity services [14] - The environmental and health segment accounted for 16% of net revenues, increasing by 9% due to regulatory consulting engagements in the chemicals industry [15] Market Data and Key Metrics Changes - Reactive engagements saw robust growth due to increased dispute-related activity across various sectors, particularly in energy, transportation, and life sciences [4][5] - Proactive engagements were led by risk management and asset integrity projects in the utility sector, with strong demand for regulatory consulting in the chemicals sector [6] Company Strategy and Development Direction - The company is focused on capturing demand in transformative technologies, particularly in artificial intelligence and human-machine interaction [8] - Exponent aims to leverage its expertise in failure analysis and risk management to navigate technological disruptions and drive sustained growth [8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about improving demand trends in consumer electronics and highlighted the importance of their diversified portfolio [4][7] - The company anticipates low to mid-single-digit revenue growth for the 4th Quarter of 2025, with a year-over-year revenue headwind of approximately 7% due to fewer workdays [16] Other Important Information - The company distributed $15.1 million to shareholders through dividends and repurchased $40 million of common stock [13] - A $100 million increase in the stock repurchase program was approved, reflecting confidence in the company's long-term growth trajectory [14] Q&A Session Summary Question: Thoughts on 2026 hiring plans - Management indicated strong momentum in recruiting, targeting a headcount growth of 4% to 6% in 2026, focusing on areas with growth such as digital health and autonomous vehicles [22][23] Question: AI integration and growth potential - AI is significantly penetrating the business, with applications across various sectors, and is expected to be balanced between proactive and reactive engagements [24][25] Question: Growth between proactive and reactive practices - The reactive side of the business has been the primary growth driver, with an 18% increase in the reactive business and flat growth in proactive engagements [26][27] Question: Impact of regulatory environment - The regulatory environment remains dynamic, with strong growth in chemical regulatory work, despite some delays in feedback from agencies [29][30] Question: Government shutdown impact - The company expects minimal impact from the government shutdown, as most of its federal contracts are ongoing and under contract [32] Question: Preliminary thoughts on revenue growth for next year - Management is optimistic about growth in 2026 but will provide specific guidance at the end of January or early February [33]