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 [24][25] - 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% [29][30] - The company raised the lower end of its Fiscal Year 2026 revenue guidance, now expecting revenues between $1.95 billion and $2 billion, reflecting nearly a 15% growth over pro forma FY25 results [8][33] 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 [25] - 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% [26] Market Data and Key Metrics Changes - The total ceiling value of new contract awards during Q2 reached $3.5 billion, marking a historic record achievement for the company [6][8] - The company ended the quarter with a funded backlog of $1.1 billion and an unfunded backlog of $2.8 billion, indicating strong future revenue visibility [24][32] Company Strategy and Development Direction - The company is focused on expanding manufacturing capacity to meet accelerating demand across several products and programs, with plans for a new facility in Salt Lake City [20][22] - The integration of BlueHalo is exceeding expectations, strengthening the company's capabilities and positioning it as a next-generation defense tech company [7][21] Management's Comments on Operating Environment and Future Outlook - Management highlighted the defense industry is at an inflection point, with the U.S. Department of War committed to agile procurement practices favoring companies that invest in innovative solutions [9][36] - The company is well-positioned to capitalize on the transformation towards cost-efficient autonomous drones and counter-drone systems enabled by AI and machine learning [9][10] Other Important Information - The company launched several innovative products, including the next generation of Switchblade loitering munitions and the Vapor Compact Long-Endurance Helicopter, enhancing its product portfolio [13][15] - The company secured a significant $240 million contract for long-haul laser communication terminals, a critical step for future space networks [16][70] Q&A Session Summary Question: Current schedule of SCAR program and its contribution - Management confirmed that the SCAR program is transitioning from development to product delivery, which is expected to ramp up revenue and improve margins in the second half of the year [38][39] Question: Drivers of profitability and margin progression - Management indicated that product revenue mix will improve, leading to higher adjusted gross margins in Q4, driven by the transition to fixed-price product revenues [40][41] Question: Growth levels by product, specifically Switchblade - Management noted that Switchblade is the fastest-growing product in the precision strike category, with significant growth year-over-year [48][50] Question: International opportunities for TUAS platforms - Management highlighted that the nearly $900 million sole-source IDIQ contract includes international sales opportunities, with favorable margins compared to domestic sales [87][89]