Financial Data and Key Metrics Changes - The company reported record second quarter revenue of nearly $473 million, representing a 151% increase year-over-year, or a 9% increase on a pro forma basis [25][26] - Adjusted EBITDA for Q2 was $45 million, up from $25.9 million in the previous year, with EBITDA as a percentage of revenue at 9.5% [31][32] - The company raised the lower end of its Fiscal Year 2026 revenue guidance, now expecting revenues between $1.95 billion and $2 billion, indicating nearly a 15% growth over pro forma FY25 results [6][34] Business Line Data and Key Metrics Changes - The AXS segment recognized $302 million in revenue, a 15.7% increase over FY25 pro forma revenues, driven by precision strike and counter-UAS products, which saw nearly a 38% increase [26] - The space, cyber, and directed energy segment reported $171 million in revenue, similar to pro forma results from the same quarter last year, with space and directed energy products growing over 20% [27] Market Data and Key Metrics Changes - The total ceiling value of new contract awards during Q2 reached $3.5 billion, a historic record for the company, contributing to record bookings of nearly $1.4 billion [4][5] - Funded backlog at the end of Q2 was $1.1 billion, with an unfunded backlog of $2.8 billion, reflecting strong visibility into future revenue [33] Company Strategy and Development Direction - The company is focused on expanding manufacturing capacity to meet accelerating demand, with plans for a new facility in Salt Lake City that could produce over $2 billion worth of products annually [20][21] - The integration of BlueHalo is exceeding expectations, enhancing the company's capabilities and positioning it as a leader in next-generation defense technology [22][23] Management's Comments on Operating Environment and Future Outlook - Management highlighted a generational shift in the U.S. Department of Defense's procurement strategy, emphasizing speed, scale, and commercially driven solutions, which aligns with the company's business model [8][38] - The company expressed confidence in meeting its guidance for the year despite challenges from the government shutdown, anticipating significant demand for its innovative offerings [36][37] Other Important Information - The company launched several new products, including the next generation of Switchblade loitering munitions and the Vapor Compact Long-Endurance Helicopter, aimed at enhancing operational capabilities [12][13] - A collaboration with OpenJAUS was announced to enhance interoperability among various defense platforms, further solidifying the company's role in the industry [15] Q&A Session Summary Question: Current schedule of SCAR and its contribution to expected ramp - Management confirmed that the SCAR program is transitioning from development to product delivery, which will ramp up revenue and improve margins in the second half of the year [39][40] Question: Drivers of profitability and margin progression - The mix of product revenues versus service revenues is expected to improve, leading to higher adjusted gross margins by Q4 [41][42] Question: Growth levels by product, specifically Switchblade - Switchblade is the fastest-growing product in the precision strike category, with significant year-over-year growth [44] Question: International opportunities for TUAS platforms - The company sees significant international market potential for its TUAS platforms, with favorable margins compared to domestic sales [60][62]