Financial Data and Key Metrics Changes - Revenues increased 12% year-over-year to a Q1 record of $385 million, with underlying consolidated revenues growing roughly 26% when excluding contributions from major contracts in Mexico and acquired businesses [4][12] - Record Q1 non-GAAP adjusted EPS reached $1.42, reflecting strong revenue growth [4][12] - Q1 bookings were strong, with a book-to-bill ratio of approximately 1.1, resulting in a record Q1 backlog approaching $1.9 billion [5][12] Business Line Data and Key Metrics Changes - Security division revenues were $254 million, a 13% year-over-year growth, driven by higher service revenues and robust sales of aviation and RF detection products [6][12] - Optoelectronics division achieved record Q1 revenues of $110 million, a 12% increase year-over-year, supported by growth across diversified product lines [10][12] - Healthcare division sales rose 10% year-over-year, indicating progress from improvement plans under new leadership [10][12] Market Data and Key Metrics Changes - Service revenues grew 23% during the quarter, reflecting a shift towards higher recurring revenues from ongoing service and support [6][12] - The company noted strong demand across various regions, including EMEA, Americas, and Asia-Pacific, with significant contributions from service revenues [22][23] Company Strategy and Development Direction - The company is focused on innovation, operational excellence, and customer satisfaction, with a diversified business model supporting growth [5][11] - There is an emphasis on expanding capabilities through potential acquisitions, particularly in complementary technologies that enhance service offerings [30][31] - The company is well-positioned to capitalize on government investments in advanced security systems due to geopolitical factors [8][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the future outlook, citing a robust backlog and strong cash flow generation expected in Fiscal 2026 [11][18] - The impact of the government shutdown has been limited, with essential services continuing to operate without significant disruptions [27][28] - Management anticipates that funding from government initiatives will begin to flow in the second half of the fiscal year [35] Other Important Information - The company raised its Fiscal 2026 guidance for revenues to a range of $1.825 billion to $1.867 billion, reflecting a growth rate of 6.5% to 9.0% [18][19] - Non-GAAP adjusted earnings per diluted share guidance was also raised to a range of $10.20 to $10.48, representing 9% to 12% year-over-year growth [18][19] Q&A Session Summary Question: What products and markets are driving strength in the Security division? - Management noted diversified growth across regions, with strong performance in service revenues and RF detection products contributing significantly [22][23] Question: What is the expected growth rate for service revenues this year? - While specific guidance on service versus product revenues is not provided, management expects faster growth in recurring service revenue compared to product revenues [24] Question: How is the company addressing the impact of reduced revenues from Mexico? - Management indicated that while there is a significant reduction in revenues from Mexico, the overall business has been able to cover these headwinds with growth in other product lines [29] Question: What is the status of unbilled receivables in Mexico? - Management reported progress in reducing unbilled receivables and expects significant cash flow from Mexico throughout Fiscal 2026 [30] Question: What is the outlook for margin expansion in the Security division? - Management anticipates margin expansion as the company moves past difficult comparisons related to Mexico revenues, with expectations for improved margins in the upcoming quarters [32][34]