Q1 2025 Booz Allen Hamilton Holding Corp Earnings Call
Good morning and thank you for standing by and welcome to Booz Allen Hamilton's earnings call covering first quarter fiscal year 2025 results.
Operator: At this time, all participants are in a listen-only mode. Later, there will be an opportunity for questions.
Operator: Hamilton's earnings call covering the first quarter fiscal year 2025 results. At this time, all participants are in a listen-only mode.
Operator: Later, there will be an opportunity for questions. I would now like to turn the call over to Mr. Matt Calderone. Thank you. Good morning, everyone, and thanks for joining the call. I would like to begin by introducing Lindsey Joy.
Operator: I'll now like to turn the call over to Mr. Matt Calderone.
Matthew Calderone: Thank you.
Matthew Calderone: Good morning, everyone. And thanks for joining the call.
Lindsay Joyce: I would like to begin by introducing Lindsay Joyce. Lindsay has been a trusted advisor and core member of the Booz Allen Finance team. For nearly a decade. To join the firm to help me establish our corporate development function. And as since had a variety of roles in corporate and business finance. Lindsay has now a vice president at Booz Allen, leading both investor relations and financial planning and analysis.
Matthew A. Calderone: Lindsay has been a trusted advisor and core member of the Booz Allen finance team for nearly ten years. She joined the firm to help me establish our corporate development, and she has since had a variety of roles in corporate and business. She is now a vice president.
Lindsay is now vice President at Booz, Allen, leading both Investor Relations and financial planning and analysis Lindsay welcome and over to you.
Matthew A. Calderone: Leading both Investor Relations and Financial Planning & Analysis. Lindsey, welcome, and over to you.
Lindsay Joyce: Lindsay, welcome, and over to you.
Lindsay Joyce: Thank you. Good morning. And thank you for joining us for Booz Allen's first quarter fiscal year 2025 earnings call. We hope you've had an opportunity to read the press release we issued earlier this morning. We have also provided presentation slides on our website and are now on slide two.
Lindsay Joyce: Good morning, and thank you for joining us for Booz Allen's first quarter fiscal year 2025 earnings. We hope you've had an opportunity to read the press release we issued earlier this month. We have also provided presentation slides on our website and are now on slide. With me to talk about our business and financial results are Horacio Rozanski, our Chairman, Chief Executive Officer, and President, and Matt Calderone, Executive Vice President and Chief Financial Officer, as shown in the disclaimer on slide three.
Speaker Change: Good morning, and thank you for joining us for Booz Allen's first quarter fiscal year 2025 earnings call.
Speaker Change: We hope you've had an opportunity to read the press release, we issued earlier this morning.
Speaker Change: We have also provided presentation slides on our website and are now on slide two.
Lindsay Joyce: With me to talk about our business and financial results are Horacio Rizanski, our chairman, chief executive officer, and president, and Matt Calderone, executive vice president and chief financial officer.
Speaker Change: With me to talk about our business and financial results are Horacio Rozanski, Our chairman Chief Executive Officer, and President and Matt <unk> Executive Vice President and Chief Financial Officer.
Lindsay Joyce: As shown in the disclaimer on slide three, please keep in mind that some of the items we will discuss this morning are forward-looking and may relate to future events or our future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause our actual results to differ materially from forecasted results discussed in our SEC filings and on this call. All forward-looking statements are expressly qualified in their entirety by the foregoing cautionary statements and speak only as of the date made. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.
Speaker Change: As shown on the disclaimer on slide three please keep in mind that some of the items. We will discuss this morning are forward looking and may relate to future events or our future financial performance and involve known and unknown risks uncertainties and other factors that may cause our actual results to differ materially from forecasted results.
Lindsay Joyce: Please keep in mind that some of the items we will discuss this morning are forward-looking. They may relate to future events or our future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause our actual results to differ materially from forecasted results discussed in our SEC filings and on this call. All forward-looking statements are expressly qualified in their entirety by the foregoing cautionary statements and speak only as of the date. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statement, whether as a result of new information, future events, or otherwise.
Speaker Change: As discussed in our SEC filings and on this call.
Lindsay Joyce: During today's call, we will also discuss some non-GAAP financial measures and other metrics which we believe provide useful information for investors. We include an explanation of adjustments and other reconciliations of our non-GAAP measures to the most comparable GAAP measures in our first quarter fiscal year 2025 earnings release and slides. Numbers presented may be rounded, and as such, may vary slightly from those in our public disclosure. It is now my pleasure to turn the call over to our Chairman, CEO, and President, Horacio Rozanski. We are now on the slide. Thanks, Lucy.
Speaker Change: All forward looking statements are expressly qualified in their entirety by the foregoing cautionary statements and speak only as of the date made.
Speaker Change: Except as required by law, we undertake no obligation to update or revise publicly any forward looking statements, whether as a result of new information future events or otherwise.
Lindsay Joyce: During today's call, we will also discuss some non-GAAP financial measures and other metrics, which we believe provide useful information for investors. We include an explanation of adjustments and other reconciliation of our non-GAAP measures to the most comparable GAAP measures in our first quarter fiscal year 2025 earnings release and slides. Numbers presented may be rounded, and as such, may vary slightly from those in our public disclosure.
Speaker Change: During today's call. We will also discuss some non-GAAP financial measures and other metrics, which we believe provide useful information for investors.
Speaker Change: We include an explanation of adjustments and other reconciliations of our non-GAAP measures to the most comparable GAAP measures in our first quarter fiscal year 2025 earnings release and slides.
<unk> presented maybe rounded and as such May vary slightly from those in our public disclosure.
Lindsay Joyce: It is now my pleasure to turn the call over to our Chairman, CEO and President, Horace Overzanski. We are now on Slide four.
Speaker Change: It is now my pleasure to turn the call over to our chairman CEO and President Horacio Rozanski, we are now on slide four.
Horacio Rozanski: Thanks, Lindsay. It's great to have you on this call.
Lindsay: Thanks Lindsay.
Horacio D. Rozanski: It's great to have you on this call. Thank you. And good morning, everyone.
Horacio D. Rozanski: Great to have you on these calls.
Horacio Rozanski: Good morning, everyone. Matt and I are proud to share with you another quarter of strong momentum and double-digit top line growth. Today I'll begin with an overview of the first quarter in the context of our fiscal year and the investment thesis. Then I'll describe how Vault strategically positions us for continuous growth and helps us attract exceptional talent.
Horacio D. Rozanski: Hey, good morning, everyone.
Horacio D. Rozanski: Matt and I are proud to share with you another quarter of strong momentum and double-digit top line growth. Today, I'll begin with an overview of the first quarter in the context of our fiscal year and our investment. Then, I'll describe how Volt strategically positions us for continued growth and helps us attract exceptional talent. And finally, I'll share our priorities for the remainder of the fiscal year. Before turning it over to Matt for an in-depth look at our first quarter fiscal 2025 report, beginning with performance.
Horacio D. Rozanski: Matt and I are proud to share with you another quarter of strong momentum on double digit topline growth.
Today I'll begin with an overview of the first quarter in the context of our fiscal year on the investment thesis.
Matt: Then I'll describe how bolt strategically positions us for continued growth and helps us attract exceptional talent.
Horacio Rozanski: And finally, I'll share our priorities for the remainder of the fiscal year before turning it over to Matt for an in-depth look at our first quarter fiscal 2025 release. Results: Beginning with performance, we built significant momentum in the quarter, delivering double-digit organic revenue growth. Our bottom line performance was comparatively softer due to a combination of operational and non-operational factors, which Matt will describe momentarily. Leading indicators for the business remain strong. Headcount for the quarter was robust, cash flow was ahead of our own internal expectations, and our 1.72 book-to-bill was excellent. So, when looking at the full picture, we believe we are on track to meet our fiscal year 2025 guidance and achieve the high end of our investment thesis goals.
Matt: And finally I'll share our priorities for the remainder of the fiscal year.
Matt: Before turning it over to Matt for an in depth look at our first quarter fiscal 2025 results.
Horacio D. Rozanski: We built significant momentum in the quarter, delivering double-digit organic revenue growth. However, our bottom line performance was comparatively soft, due to a combination of operational and non-operational factors, which Matt will describe momentarily. Leading indicators for the business remain strong, and headcount for the quarter was robust. Cash flow was ahead of our own internal expectations, and our 1.72 book-to-bill ratio was excellent. So, looking at the full picture, we believe we are on track to meet our fiscal year 2025 guidance and achieve the high end of our investment thesis goal. Booz Allen's momentum shows beyond our finances. It is evident in the quality of the work we win, the innovative capabilities we deliver, and the exceptional talent we attract. This is because Volt is working.
Matt: Beginning with performance.
Matt: Significant momentum in the quarter delivering double digit organic revenue growth.
Matt: Our bottom line performance was comparatively softer due to a combination of operational and nonoperational factors, which Matt will describe momentarily.
Matt: Leading indicators for the business remains strong.
Matt: Head count for the quarter was robust.
Matt: Cash flow was ahead of our own internal expectations on our one <unk> book to Bill was excellent.
Matt: So we're looking at the full picture. We believe we are on track to meet our fiscal year 2025 guidance.
Matt: <unk> achieved the high end of our investment thesis goals.
Horacio Rozanski: Booz Allen's momentum shows beyond our financials. It is evident in the quality of the work we win, the innovative capabilities we deliver, and the exceptional talent we attract. This is because Volt is working. Volt, which stands for Velocity, Leadership and Technology, has put us at the center of the tech transformation taking place across national priority missions. Our ability to help clients utilize dual use and leading edge technologies faster and at scale is a powerful differentiator. But this time of historic challenge and change for our nation, Booz Allen is an innovation accelerator.
Speaker Change: Whose allen's momentum shows beyond our financials.
Speaker Change: As evident in the quality of the work we win.
Speaker Change: The innovative capabilities, we deliver and the exceptional talent we attract.
Speaker Change: This is because volt.
Speaker Change: Working.
Speaker Change: Volt, which stands for velocity leadership and technology has put us at the center of the tech transformation, taking place across national priority missions.
Horacio D. Rozanski: Volt, which stands for Velocity, Leadership, and Technology, has put us at the center of the tech transformation taking place across national priority missions. Our ability to help clients utilize dual-use and leading-edge technologies faster and at scale is a powerful differentiation at this time of historic challenge and change for our nation. Booz Allen is an innovation accelerator. This morning, I will share three examples of them. The first is actually from one of the missions we have supported the longest, space.
Speaker Change: Our ability to help clients utilize dual use and leading edge technologies faster and that scale is a powerful differentiator.
Speaker Change: At this time of historic challenge and change for our nation.
Speaker Change: Booz Allen is an innovation accelerator.
Horacio Rozanski: This morning, let me share three examples that demonstrate this. The first is actually from one of the missions we have supported the longest space. Space encompasses civilian intelligence and defense missions. Today, Booz Allen's space business is more than a half a billion dollars in growing. We have been a trusted US space partner since the beginning, more than 60 years. From our nation's response to Sputnik to Apollo, to the Hubble Space Telescope. And we continue to help NASA launch the future and inspire the world, working on trajectories as we did 55 years ago using leading-edge analytics.
Speaker Change: Just wondering let me share three examples that demonstrate this.
Speaker Change: The first is actually from one of the missions, we have supported the longest.
Speaker Change: Space.
Horacio D. Rozanski: Space encompasses civilian, intelligence, and defense. Today Booz Allen's space business is more than a half a billion dollars in gross. We have been a trusted U.S. space partner since the beginning, more than 60 years ago, from our nation's response to Sputnik, to Apollo, to the Hubble Space Telescope, and we continue to help NASA launch the future and inspire the world, working on trajectories as we did 55 years ago using leading-edge analytics.
Speaker Change: Space encompasses civilian intelligence and defense missions.
Speaker Change: Today was Allen space business is more than a half a billion dollars and growing.
Speaker Change: We have been a trusted U S based partner since the beginning more than 60 years.
Speaker Change: From our nation's response to sputnik to Apollo to the Hubble space telescope.
Speaker Change: And we continue to help us launch the future and inspire the world.
Working on trajectories as we did 55 years ago, using leading edge analytics.
Horacio Rozanski: We are the overarching system of systems integrator for Artemis, the mission to go back to the Moon and create a lunar outpost for a flight to Mars. Importantly, and over the past year, Booz Allen has won several strategic contracts that position us to support and protect vital national security interests in space. Two weeks ago, I had the opportunity to spend time with our Colorado Springs teams and visit the United States Space Operations Command to discuss opportunities to modernize our nation's space capabilities. Coincidentally, while I was there, our team successfully uploaded and made operational what we believe is the first large language model in space.
Horacio D. Rozanski: We are the overarching system of systems integrator for our mission to go back to the moon and create a lunar outpost for a flight to Mars. Importantly, and over the past year, Booz Allen has won several strategic contracts that position us to support and protect vital national security interests in two weeks ago. I had the opportunity to spend time with our Colorado Springs team and visit the United States Space Operations Command to discuss opportunities to modernize our nation's space capability. Coincidentally, while I was there, our team successfully uploaded and made operational what we believe is the first large language model in space, on board the International Space Station's National Lab.
Speaker Change: We are the overarching system of systems integrator for Artemis.
Speaker Change: The mission to go back to the Moon and create a lunar outpost for flight to Mars.
Speaker Change: Importantly, and over the past year.
Speaker Change: As Alan has won several strategic contracts that position us to support and protect vital national security interests in space.
Speaker Change: Two weeks ago I.
Speaker Change: I had the opportunity to spend time with our Colorado Springs teams and visit the United States based operations command to discuss opportunities to modernize our nation's space capabilities.
Coincidentally, while I was there our team successfully uploaded and made operational what we believe is the first large language model in space.
Horacio Rozanski: Umbord the International Space Station's National Lab. This intersection of AI and space is one of the next frontiers. And Justice Booz Allen is a leading provider of AI to the Federal government.
Speaker Change: On board the international Space station National Lab.
Horacio D. Rozanski: This intersection of AI and space is one of the next frontiers, and Justice Booz Allen is a leading provider of AI to the federal government. We are at the cutting edge of this effort. The second example of Vault in action is our long-standing work in Europe and our growing foothold. Supporting one of the most dynamic combatants, United States European Command or U. Booz Allen has been a trusted partner supporting efforts in Europe for more than 30 years.
This intersection of AI and space is one of the next frontiers.
Speaker Change: And just as Booz Allen is a leading provider of AI to the federal government.
Horacio Rozanski: We are on the cutting edge of this effort too.
Speaker Change: We are on the cutting edge of this effort too.
Horacio Rozanski: The second example of vault in action is our long-standing work in Europe and our growing footprint supporting one of the most dynamic combatant commands, United States European Command or U-Com. Booz Allen has been a trusted partner supporting efforts in Europe for more than 30 years. Over the past 10 years, our work has grown nearly sixfold, from 150 to more than 800 professionals. This growth accelerated to support our country's efforts during Russia's invasion of Ukraine. Through Vault, we had the right people and solutions at the right time to help U-Com leverage cutting edge data science to speed decision making at the highest levels.
Speaker Change: The second example of volt in action is our long standing work in Europe, and our growing footprint supporting one of the most dynamic combatant commands United States European comment are you com.
Speaker Change: We as Alan has been a trusted partner supporting efforts in Europe for more than 30 years.
Horacio D. Rozanski: Over the past 10 years, our work has grown nearly six times, from about 150 to more than 800. This growth accelerated to support our country's efforts during Russia's invasion of Ukraine. Through VOLT, we have the right people and solutions at the right time to help you leverage cutting-edge data science to speed decision-making at the highest level.
Speaker Change: Over the past 10 years, our work has grown nearly six fold.
Speaker Change: 150 to more than 800 professionals.
Speaker Change: This growth accelerated to support our country's efforts during Russia's invasion of Ukraine.
Speaker Change: Through bolt we.
Speaker Change: We have the right people and solutions at the right time to help you come leverage cutting edge data science to speed decision, making at the highest levels.
Horacio Rozanski: That is why we are particularly proud to have won a critical recompete to continue our work supporting U.S. missions across the continent.
Horacio D. Rozanski: That is why we are particularly proud to have won a critical contract to continue our work supporting U.S. missions across the continent. My third and final example of how Volt is driving our momentum is our recent acquisition of PAR Government Systems Corporation. PAR is an original creator and leading engineering partner for preeminent software products, enabling tactical support that spans ground, air, and space.
Speaker Change: That is why we are particularly proud to have won a critical recompete to continue our work supporting U S missions across the continent.
Horacio Rozanski: My third and final example for how Vault is driving our momentum is a recent acquisition of PAR Government Systems Corporation. PAR is an original creator and leading engineering partner for preeminent software products and solutions, enabling tactical support that spans ground, air, and space missions. This acquisition strategically augments Booz Allen's capability since situational awareness, mission readiness, and detecting and defeating drone threats. It will help accelerate our ability to deliver mission-critical solutions to our nation's war fighters on the tactical edge. These examples from across the globe and beyond show how Vault moves us forward and helps ensure we remain a vital partner in missions of national importance in the phase of ongoing change.
My third and final example for how vault is driving our momentum is our recent acquisition of par government systems Corporation.
Speaker Change: Par is on original creator and leading engineering partner for preeminent software products and solutions.
Speaker Change: Enabling tactical support that spans ground air and space missions.
Horacio D. Rozanski: This acquisition strategically augments Booz Allen's capabilities in situational awareness, mission readiness, and detecting and defeating drones. It will help accelerate our ability to deliver mission-critical solutions to our nation's warfighters on the tactical edge. These examples from across the globe and beyond show how Volt moves us forward and helps ensure we remain a vital partner in missions of national importance in the face of ongoing. So a volt is the engine powering our momentum.
Speaker Change: This acquisition strategically augments booz Allen's capabilities, and situational awareness mission readiness, and detecting and defeating drone threats.
Speaker Change: It will help accelerate our ability to deliver mission critical solutions to our nation's war fighters on the tactical edge.
Speaker Change: These examples from across the globe and beyond.
Joe how volt moves us forward and.
Joe: Helps ensure we remain a vital partner and missions of national importance in the face of ongoing change.
Horacio Rozanski: So vault is the engine powering our momentum; our people are the fuel that makes us go. Our people bring unmatched mission expertise and technological innovation to every project. And this is why I always speak about our people and not our contracts as a real key to our success.
Joe: So vault is the engine powering our momentum.
Horacio D. Rozanski: Our people are the fuel that makes us go. They bring unmatched mission expertise and technological innovation to every project. And this is why I always speak about our people and not our contracts as a real key to our Booz Allen stays vibrant by attracting the best talent, like Bilbao, whom we welcomed last month as our new chief technology officer. Bill brings more than 40 years of technology leadership and experience spanning industry and government.
Joe: Our people are the fuel that makes us go.
Joe: Our people bring unmatched mission expertise and technological innovation to every project.
Joe: And this is why I always speak about our people and not our contracts as a real key to our success.
Horacio Rozanski: Booz Allen stays vibrant by attracting the best talent, like Bill Vass, whom we welcomed last month as our new chief technology officer. Bill brings more than 40 years of technology leadership and experience spanning industry and government. He will help Booz Allen accelerate our leadership in injecting dual-use tech into our client's missions faster and at scale. Bill, welcome.
Joe: Booz Allen stays vibrant by attracting the best talent.
Joe: Like Bill Vas, whom we welcomed last month as our new Chief Technology Officer.
Bill Vas: Bill brings more than 40 years of technology leadership, and the experience spanning industry and government.
Horacio D. Rozanski: He will help Booz Allen accelerate our leadership in injecting dual-use tech into our clients' missions faster and at scale. Bill, welcome. And on the other end of the spectrum, we are building our pipeline of future stars through our summer internship program, which we call Summer Games. This year, we have 128 exceptional students participating in the program.
Joe: He will help booz Allen accelerate our leadership in injecting dual use tech into our clients' missions faster and that scale.
Joe: Bill.
Joe: Welcome.
Horacio Rozanski: And on the other end of the spectrum, we are building our pipeline of future stars through our summer internship program, which we call Summer Games. This year we have 128 exceptional students participating in the Our interns collaborate on challenge projects in the areas of capability development, process improvement, and social good. We believe good ideas come from every level in this firm, from our newest colleagues to our longest serving. This fits with Booz Allen's purpose to empower people to change the world. And that starts with empowering our own people, whether consultants, engineers, scientists, analysts, cyber professionals, and of course summer interns.
Joe: And on the other end of the spectrum, we are building our pipeline of future stars through our summer internship program, which we call summer games.
Joe: This year, we have 128 exceptional students participating in the program.
Horacio D. Rozanski: Our interns collaborate on challenge projects in the areas of capability development, process improvement, and social good. We believe good ideas come from every level in this firm, from our newest colleagues to our longest-serving. This fits with Booz Allen's purpose to empower people to change the world.
Joe: Our interims collaborate on challenged projects in the areas of capability development process improvement and social good.
Joe: We believe good ideas come from every level in this firm for our newest colleagues to our longest serving.
Joe: This fits with Booz allens purpose to empower people to change the world.
Horacio D. Rozanski: And that starts with empowering our own. We are consultants, engineers, scientists, analysts, and cyber professionals. And, of course, Summer End. I am so, so proud of them.
Joe: And that starts with empowering our own people, whether consultants engineers scientists analysts cyber professionals.
And of course summer enters.
Horacio Rozanski: I am so, so proud of this team and want to thank again all of my Booz Allen colleagues, past, present, and future.
Joe: I am so proud of this team.
Horacio D. Rozanski: And I want to thank again all of my Booz Allen colleagues, past, present, and future. Returning to the here and now, today our collective focus is on the operational priorities we laid out in May. First, we will take full advantage of our Record Proposal Pipeline. This includes continuing to win new work and re-compete, launch programs quickly, and hiring excellent people to build the depth of our expertise. We will continue to manage the business tightly, to drive efficiency and effectiveness across all our. We have opportunities to improve margins while we continue to mitigate growing budgetary uncertainty in an election year. And third,
Joe: And want to thank again, all of my Booz Allen colleagues.
Joe: Past present and future.
Horacio Rozanski: Returning to the here and now, today our collective focus is on the operational priorities we laid out in May. First, we will take full advantage of our record proposal pipeline. This includes continuing to win new work and recompense, launching programs quickly, and hiring excellent people to build the depth of our expertise. Second, we will continue to manage the business tightly to drive efficiency and effectiveness across all our functions. We have opportunities to improve margin while we continue to mitigate growing budgetary uncertainty in an election year. And third, we will continue to implement Vault at full speed by building the next generation technology solutions and market positions, securing breakthrough technology partnerships, and maturing our internal capabilities.
Joe: Returning to the here now today, our collective focus is on the operational priorities, we laid out in may.
Joe: First we will take full advantage of our record proposal pipeline.
Joe: This includes continuing to win new work and re competes.
Joe: Launching programs quickly on hiring excellent people to build the depth of our expertise.
Joe: Second we will continue to manage the business tightly to drive efficiency and effectiveness across all our functions.
Joe: We have opportunities to improve margin, while we continue to mitigate growing budgetary uncertainty in an election year.
Joe: And third.
Horacio D. Rozanski: We will continue to implement VOLT at full speed by building next-generation technology solutions and market position, securing breakthrough technology partnerships, and maturing our internal capability. So, in summary.
Joe: We will continue to implement volt at full speed.
Joe: By building the next generation technology solutions and market positions.
Joe: Securing breakthrough technology partnerships.
Joe: And maturing our internal capabilities.
Horacio Rozanski: So, in summary, we remain optimistic about our growth prospects, even in an uncertain budgetary scenario and a contentious election environment. We believe in the fundamental strength of the business we have built and feel confident about the future.
Joe: So in summary.
Horacio D. Rozanski: We remain optimistic about our growth prospects, even in an uncertain budgetary scenario and a contentious election cycle. We believe in the fundamental strength of the business we have built and feel confident about its future. 110 years young.
Joe: We remain optimistic about our growth prospects, even in an uncertain budgetary scenario and a contentious election environment.
Joe: We believe in the fundamental strength of the business, we have built and feel confident about the future.
Horacio Rozanski: At 110 years young, Booz Allen is as vibrant and exciting as ever.
Joe: At 110 years young.
Horacio D. Rozanski: Booz Allen, Issa Zbiber, I'm excited, as ever. And with that, Matt, over to you for a deep dive into our finances. Thank you, Ross. As you noted, Booz Allen continued to build momentum in the first quarter. Our BOLT strategy is working, and our work is increasingly at the center of the government's technological transformation. We are poised to keep going, to deliver another Strong Fiscal Year for the quarter on the positive. Our team once again delivered double-digit organic revenue. Cash performance was solid, and most of our leading indicators were strong.
Alan: Alan is as vibrant.
Alan: And exciting.
Alan: As ever.
Matthew Calderone: And with that, Matt, over to you for a deep dive into our financial performance.
Matthew A. Calderone: On the demand side, we had key wins that yielded an [inaudible] on the supply side. We will continue to add the talent needed to support our growth objective. Our bottom line performance, however, was a bit softer than we anticipated. This was due to a number of individually small operational and non-operational facts that added up.
Alan: And with that Matt over to you for a deep dive into our financial performance.
Matthew Calderone: Thank you, Rossiou. As you noted, Booz Allen continued to build momentum in the first quarter. Our vault strategy is working, and our work is increasingly at the center of the government's technology transformation. We are poised to keep growing and to deliver another strong fiscal year. For the quarter, on the positive side, our team once again delivered double-digit organic revenue growth. Cash performance was solid, and most important are leading indicators were strong. On the demand side, we had key wins that yielded an excellent book to build and record backlog. On the supply side, we continued to add the talent needed to support our growth objectives.
Matt: Thank you Raphael.
Matt: As you noted Booz Allen continued to build momentum in the first quarter.
Matt: Our bulk strategy is working and our work is increasingly at the centre of the governments technology transformation.
Matt: We are poised to keep growing and to deliver another strong fiscal year.
Speaker Change: For the quarter on the positive side, our team once again delivered double digit organic revenue growth.
Speaker Change: Cash performance was solid.
Speaker Change: And most important our leading indicators were strong.
Speaker Change: On the demand side, we had key wins that yielded an excellent book to bill and record backlog.
Speaker Change: On the supply side, we continued to add the talent needed to support our growth objectives.
Matthew Calderone: Our bottom line performance, however, was a bit softer than we anticipated. This was due to a number of individually small operational and non-operational factors that added up over the quarter. As we said previously, we met at the business for the full... fiscal year. We have both the demand side and supply side momentum, as well as the operating levers available to us to meet our fiscal year 2025 objectives and achieve the top end of our investment thesis.
Our Bottomline performance, however was a bit softer than we anticipated.
This was due to a number of individually small operational and nonoperational factors that added up over the quarter.
Matthew A. Calderone: As we said previously, we manage the business for the full. We have both the demand side and supply side momentum, as well as the operating levers available to meet our fiscal year 2025 objectives to achieve the top end of our investment. I'll now cover our first quarter results and more. Please turn to slide 16.
Speaker Change: As we said previously we manage the business for the full fiscal year.
We have both the demand side and supply side momentum.
Speaker Change: As well as the operating levers available to us.
Speaker Change: Our fiscal year 2025 objectives.
Speaker Change: And achieved the top end of our investment thesis.
Matthew Calderone: I'll now cover our first quarter results in more detail.
Matthew A. Calderone: Total revenue for the quarter grew about 11% year-over-year. $2.9 billion. Organic revenue is up 10.6% year over year, and revenue Excluding Billable Expenses. Taking a look at the market break. Our defense business continues to thrive. 16% from the prior year. Our defense leaders won both re-competes and take-away opportunities. Admissions of True National Empowerment.
Speaker Change: I'll now cover our first quarter results in more detail.
Matthew Calderone: Please turn to slide six. Total revenue for the quarter grew about 11% year-over-year to $2.9 billion. Organic revenue was up 10.6% year-over-year, and revenue excluding billable expenses increased 8.4%.
Speaker Change: Please turn to slide six.
Speaker Change: Total revenue for the quarter grew about 11% year over year to $2 9 billion.
Speaker Change: Organic revenue was up 10, 6% year over year.
Speaker Change: And revenue, excluding billable expenses increased eight 4%.
Matthew Calderone: Taking a look at the market breakdown, our defense leaders won both recompense and take-away opportunities in missions of true national importance. Our civil business continues to perform well. Total revenue grew 12% year-over-year, and this performance was broad-based. As expected, revenue in our intelligence business declined about 3% year-over-year.
Speaker Change: Taking a look at the market breakdown.
Speaker Change: Our defense business continues to thrive.
Speaker Change: Up 16% from the prior year quarter.
Speaker Change: Our defense leaders, one both recompete and takeaway opportunities admissions if true national importance.
Matthew A. Calderone: Our civil business continues to perform well. Total revenue grew 12%, and this performance was due to the acquisition of a business. As expected, revenue in our intelligence business declined about 3% year over year.
Speaker Change: Our civil business continues to perform well.
Speaker Change: Total revenue grew 12% year over year and this performance was broad based.
Speaker Change: As expected revenue in our intelligence business declined about 3% year over year.
Matthew Calderone: We continue to expect this business to demonstrate solid growth for the full fiscal year.
Speaker Change: We continue to expect this business to demonstrate solid growth for the full fiscal year.
Matthew A. Calderone: I continue to expect this business to demonstrate solid growth for the full fiscal year. Turning to slide seven, we are pleased with both the scale and the quality of the work that our teams are capturing. They came out of the gate strong in the quarter, taking full advantage of our robust proposal pipeline. Net bookings for the first quarter were $5 billion, and our quarterly book-to-bill was $1.7 million. This yielded a trailing 12-month book-to-bill of 1.43 times, our highest in five years. The total backlog as of June 30th hit an all-time record.
Matthew Calderone: Turning to slide seven, we are pleased with both the scale and the quality of the work that our teams are capturing. We came out of the gates strong in the quarter, taking full advantage of our robust proposal pipeline. Net bookings for the first quarter were $5 billion, and our quarterly book to bill was 1.72 times. This yielded a trailing 12-month book-to-bill of 1.43 times our highest in five years. Total backlog as of June 30th hit an all-time record of $36 billion, up 16% year-over-year, and at the end of the first quarter, our qualified pipeline for the remainder of fiscal year 2025 stood at $55 billion.
Speaker Change: Turning to slide seven we are pleased with both the scale and the quality of the work that our teams are capturing.
Speaker Change: We came out of the gate strong in the quarter, taking full advantage of our robust proposal pipeline.
Speaker Change: Net bookings for the first quarter were $5 billion.
Speaker Change: And our quarterly book to Bill was 172 times.
Speaker Change: This yielded a trailing 12 month book to Bill of 143 times, our highest in five years.
Speaker Change: Total backlog as of June 30th hit an all time record of $36 billion.
Matthew A. Calderone: $36 billion. And at the end of the first quarter, our qualified pipeline for the remainder of fiscal year 2025 stood at $55 billion. This is up 32% from a year ago. In short, we have the backlog and the pipeline necessary to fuel the future. Moving now to headcount, Booz Allen closed the quarter with more than $35,000. We increased client-staff headcount by more than 700. Including 200 skilled professionals. Join Booz Allen through the PAR Act.
Speaker Change: Up 16% year over year.
Speaker Change: And at the end of the first quarter, our qualified pipeline for the remainder of fiscal year 2025 stood at $55 billion.
Matthew Calderone: This is up 32% from a year ago.
This is up 32% from a year ago.
Matthew Calderone: In short, we have the backlog and the pipeline necessary to fuel future growth. Moving out of headcount, we've all enclosed the quarter with more than 35,000 people. We increased client staff headcount by more than 700 in the quarter, including 200 skilled professionals who joined Brazil on through the par acquisition. This translated to 7.7% client staff growth year-over-year, ahead of our full year goal of 3-5%. We continue to recruit and hire aggressively to match our demand-side momentum. Turning out to the bottom line, we generated $302 million in adjusted EBITDA in the first quarter. Down 1.6% from the prior year period.
Speaker Change: In short, we have the backlog and the pipeline necessary to fuel future growth.
Speaker Change: Moving now to head count Booz, Allen and closed the quarter with more than 35000 people.
Speaker Change: We increased client staff head count by more than 700 in the quarter, including 200 skilled professionals, who joined Booz Allen through the <unk> acquisition.
Matthew A. Calderone: This translated to 7.7% client-staff growth year-over-year, ahead of our full year goal of three to five. We continue to recruit and hire aggressively to match our demand side. Turning now to the bottom, it generated $302 million in adjusted EBITDA, down 1.6% from the prior year period. Our Adjusted EBITDA margin was 10.3%, down 130 basis points year over year. Our profitability came in lower than expected. This is a combination of facts.
Speaker Change: This translated to seven 7% client staff growth year over year.
Speaker Change: Ahead of our full year goal of 3% to 5%.
Speaker Change: We continue to recruit and hire aggressively to match our demand side momentum.
Speaker Change: Turning now to the bottom line, we generated $302 million and adjusted EBITDA in the first quarter.
Speaker Change: Down one 6% from the prior year period.
Matthew Calderone: Our adjusted EBITDA margin was 10.3%. Down 130 basis points, your every in the year.
Speaker Change: Our adjusted EBITDA margin was 10, 3% down 130 basis points year over year.
Matthew Calderone: Our profitability came in lower than expected due to a combination of factors. On the operational side, slightly softer contract-level profitability, lower utilization, and back-weighted client-staff hiring during the quarter. And on the non-operational side, slightly higher expenses on a year-over-year basis. Some of these items are non-recurring, and others are timing-related, and are expected to normalize over the course of the fiscal year. Working down the P&L, our net income was $165 million, 2.4% higher year-over-year. Adjusted net income declined 7% year-over-year to $180 million. The littered earnings per share increased 4% year-over-year to $1.27 per share. Adjusted littered earnings per share decreased 6% year-over-year to $1.38.
Speaker Change: Our profitability came in lower than expected.
Due to a combination of factors.
Matthew A. Calderone: I'm the operational guy. Lower utilization, and back-weighted client-staff hiring during the quarter, and on the non-operational side, slightly higher expenses on a year-over-year basis. Some of these items are nonrecurring, and others are timing-related and are expected to normalize. Working down the P&L, our net income was $165 million. Adjusted Net Income declined 7% year-over-year.
Speaker Change: On the operational side slightly softer contract level profitability.
Speaker Change: Lower utilization and back weighted client staff hiring during the quarter.
Speaker Change: And on the nonoperational side slightly higher expenses on a year over year basis.
Speaker Change: Some of these items are nonrecurring and others are timing related and are expected to normalize over the course of the fiscal year.
Speaker Change: Working down the P&L, our net income was $165 million, two 4% higher year over year.
Speaker Change: Adjusted net income declined 7% year over year to $180 million.
Matthew A. Calderone: Diluted earnings per share increased 4% year over year to $1.27 per share. However, adjusted diluted earnings per share decreased 6% year over year. $1.38. These results include both a higher interest expense from our inaugural investment-grade bond offering and a higher tax rate than last fiscal year. Moderately Off, by a lower diluted weight. Moving out to the balance sheet, we ended the first quarter with $298 million of cash, net debt of $3 billion, and a net leverage of 0. 2.7 times adjusted EBITDA for the trailing 12 months. Pre-cash flow for the quarter was $20 million.
Speaker Change: Diluted earnings per share increased 4% year over year to $1 27 per share.
Speaker Change: Adjusted diluted earnings per share decreased 6% year over year to $1.38.
Matthew Calderone: These results include both a higher interest expense from our inaugural investment grade bond offering and a higher tax rate than last fiscal year, moderately offset by a lower diluted share account.
Speaker Change: These results include both a higher interest expense from our inaugural investment grade bond offering.
Speaker Change: The higher tax rate than last fiscal year.
Speaker Change: Moderately offset by a lower diluted share count.
Matthew Calderone: Moving out to the balance sheet, we ended the first quarter with $298 million of cash on hand, net debt of $3 billion, and a net leverage ratio of 2.7 times adjusted EBITDA for the trailing 12 months. Free cash flow for the quarter was $20 million. Cash from my operating activities improved to $52 million due to strong collections of cash. CapEx in the quarter was $32 million and includes $16 million of previously accrued expenditures that were paid in the first quarter. Our balance sheet is strong. This gives us flexibility in how we operate the business and deploy capital to generate value.
Speaker Change: Moving out to the balance sheet.
Speaker Change: We ended the first quarter with $298 million of cash on hand, net debt of $3 billion and our net leverage ratio of two seven times adjusted EBITDA for the trailing 12 months.
Speaker Change: Free cash flow for the quarter was $20 million.
Matthew A. Calderone: Cash from my operating activities improved to $52 million due to Strong Collection. CapEx from the quarter was $32 million, and includes $16 million of previously accrued expenditures that were paid in the first.
Speaker Change: Cash from operating activities improved to $52 million due to strong collections.
Capex in the quarter was $32 million and includes $16 million of previously accrued expenditures that were paid in the first quarter.
Matthew A. Calderone: Our balance sheet is strong. This gives us flexibility in how we operate the business. Employee Capital to Generate Value
Speaker Change: Our balance sheet is strong.
Speaker Change: This gives us flexibility in how we operate the business and deploy capital to generate value.
Matthew Calderone: Turning out a capital deployment on flight 8, we are committed to using our cash generation and balance sheet strength to drive superior value for our shareholders. In the first quarter, we deployed a total of $251 million. This includes roughly $156 million of capital return to shareholders through almost $90 million in share purchases at an average price of $149.74 per share, and $66 million in quarterly cash dividends. It also includes approximately $93 million for the acquisition of PAR in June. We believe this acquisition will increase the value we deliver to clients and accelerate our financial performance.
Matthew A. Calderone: Turning now to Capital Deployment on Friday. We are committed to using our cash generation and balance sheet strength to drive superior value for our shareholders. In the first quarter, we deployed a total of $251 million. This includes roughly $156 million of capital return to shareholders through almost $90 million in share purchases at an average price of $149.74 per share.
Speaker Change: Turning now to capital deployment on slide eight.
Speaker Change: We are committed to using our cash generation and balance sheet strength to drive superior value for our shareholders.
Speaker Change: In the first quarter, we deployed a total of $251 million.
Speaker Change: This includes roughly $156 million of capital returned to shareholders.
Speaker Change: Through almost $90 million in share repurchases at an average price of $149 74 per share.
Matthew A. Calderone: $66,000,000 in quarterly cash. It also includes approximately $93 million for the acquisition of PAR in June. We believe this acquisition will increase the value we deliver to clients and accelerate our financial performance. We anticipate that PAR will add $80 to $90 million in revenue for the balance of this fiscal year, and it will be mildly accretive. We also made $2 million of strategic investments through our Corporate Venture Capital, including our recently announced investment in Quinn and Early Stage Commercial Space Technology. Finally, I'll note that our board has approved a quarterly dividend of 51 cents per share, which will be payable on August 30th.
Speaker Change: And $66 million in quarterly cash dividends.
Speaker Change: It also includes approximately $93 million for the acquisition of par in June.
Speaker Change: We believe this acquisition will increase the value, we deliver to clients and accelerate our financial performance.
Matthew Calderone: We anticipate that PAR will add $80 to $90 million in revenue for the balance of this fiscal year, and it will be mildly accrued to our ex. We also made $2 million of strategic investments. investments through our corporate venture capital program, including our recently announced investment in Quindar, an early stage commercial space technology company.
Speaker Change: We anticipate that par will add $80 million to $90 million in revenue for the balance of this fiscal year.
Speaker Change: And it will be mildly accretive to earnings.
Speaker Change: We also made $2 million of strategic investments through our corporate venture capital program.
Speaker Change: Including our recently announced investment in <unk> and early stage commercial space Technology company.
Matthew Calderone: Finally, I'll note that our board has approved a quarterly dividend of 51 cents per share, which will be payable on August 30th to stockholders of record as of August 14th.
Speaker Change: Finally, I'll note that our board has approved a quarterly dividend of <unk> 51 per share.
Speaker Change: Which will be payable on August 30th.
Matthew A. Calderone: Stockholders of Record as of August Now for a look ahead. Do you believe we have the momentum? and Operating Flexibility, to deliver strong top and bottom line performance with a full fist. Please turn to slide nine as I run through our fiscal year 2025. On the top line, we expect revenue growth of 8 to 11%. We expect to deliver adjusted EBITDA dollars in the range of 1.26 to $1.3 billion. This implies an adjusted EBITDA margin of about 11% for the full year. While we previously indicated a flatter quarterly margin profile for fiscal year 2025, we now expect a moderately ascending, will be the remaining three. Our ADEPT guidance range is between $5.00 and $0.80.
Speaker Change: Stockholders of record as of August 14th.
Matthew Calderone: Now, for a look ahead, we believe we have the momentum in operating flexibility to deliver strong top and bottom line performance for the full fiscal year.
Speaker Change: Now for a look ahead.
Speaker Change: We believe we have the momentum.
Speaker Change: And operating flexibility to deliver strong top and bottom line performance for.
Speaker Change: For the full fiscal year.
Matthew Calderone: Please turn to slide nine as I run through our fiscal year 2025 guidance. At the top line, we expect revenue growth of 8 to 11 percent. We expect to deliver adjusted EBITDA dollars in the range of 1.26 to 1.3 billion dollars. This implies an adjusted EBITDA margin of about 11 percent for the full year.
Matthew A. Calderone: Lastly, we expect operating cash between $825 and $925 million, and free cash flow between $725,000 and $825,000. In closing, I am extremely proud that in the final year of our three-year investment, we are positioned to deliver at the top end of our target range for just, almost entirely through organic performance, continue to build our business, and are forging ahead with confidence. With that, Operator, let's open the line. Thank you so much.
Speaker Change: Please turn to slide nine as I run through our fiscal year 2025 guidance.
Speaker Change: At the top line, we expect revenue growth of 8% to 11%.
Speaker Change: We expect to deliver adjusted EBITDA dollars and the range of $1 two six.
Speaker Change: To one 3 billion.
This implies an adjusted EBITDA margin.
Speaker Change: About 11% for the full year.
Matthew Calderone: While we previously indicated a flatter quarterly margin profile for fiscal year 2025, we now expect a moderately ascending profile over the remaining three quarters. Our 8F guidance range is between $5.80 and $6.05 per share. Lastly, we expect operating cash flow between 825 and 925 million dollars, and free cash flow between 725 and 825 million dollars.
Speaker Change: While we previously indicated a flatter quarterly margin profile for fiscal year 2025, we now expect a moderately ascending profile over the remaining three quarters.
Speaker Change: Our EPS guidance range is between $5 86.
Speaker Change: $6.05 per share.
Speaker Change: Lastly, we expect operating cash flow between 825 and $925 million.
Speaker Change: And free cash flow between 725 and $825 million.
Matthew Calderone: In closing, I am extremely proud that in the final year of our three-year investment thesis, we are positioned to deliver at the top end of our target range for just EBITDA, almost entirely through organic performance. We continue to build our business for the future and are forging ahead with confidence.
Speaker Change: In closing I am extremely proud that in the final year of our three year investment thesis, we are positioned to deliver at the top end of our target range for adjusted EBITDA almost entirely through organic performance.
Speaker Change: We continue to build our business for the future.
Speaker Change: And are forging ahead with confidence.
Operator: With that, operator, let's open the line for questions. Thank you so much, and as I remind her to our tele-audience review, do have a question, simply press star 11 on your telephone to get in the queue and wait for your name to be announced.
Speaker Change: With that operator, let's open the line for questions.
Operator: And as a reminder to our telephone audience, if you do have a question, simply press star 11 on your telephone to get in the queue and wait for your name to be announced. One moment for our first question, and it comes from Mariana Perez Mora with the Bank of America. Please proceed. Good morning, everyone, and a special welcome to Lindsay.
Speaker Change: Thank you so much and as a reminder to our teller audience. If you do have a question simply press star one on your telephone to get into queue and wait for your name to be announced.
Mariana Mora: One moment for our first question, and he comes from Mariana Perez-Mora with Bank of America. Please proceed.
Speaker Change: For our first question.
Speaker Change: And he comes from Mariana Perez Mora with Bank of America. Please proceed.
Matthew Calderone: Good morning, everyone, and a special welcome to Lindsay. Thanks, Maria, and a good morning. My first question, I have to. One business related and the other one more like technical. The first question is about the PAR acquisition. Could you please describe a little bit about all the potential that you can unlock from these companies, especially like lead in position when we attack and attack, and the stall base they have, delivering that with Google's talent, customer intimacy and reputation. What is the combination of this acquisition, and when and what type of synergies we could expect from this?
Speaker Change: Good morning, everyone and a special welcome to Lindsay.
Mariana Perez Mora: Thanks, Mariana. Good morning. So my first question, I have two: one business-related and the other more like technical. The first question is about the PAR acquisition. Could you please describe a little bit about all the potential that you can unlock from these companies, especially their leading position with Wintag and TAG and the customer base they have, levering that with Booz Allen talent, customer intimacy, and reputation? What is the combination of this acquisition and when and what type of synergies we could expect from it? Thanks for that question, Mariana.
Lindsay: Thanks, Marty and good morning.
Speaker Change: So my first question I have two one business related and the other one more like technique.
Speaker Change: The first question is about the par acquisition could you. Please describe a little bit about like all the applications that you can unlock from these companies special like lead implications, when Todd and Todd and install basically half levering dad with Giussani talent customer intimacy and reputation.
Speaker Change: What is the combination of this acquisition and then when and what type of synergies.
Speaker Change: Expect from this.
Horacio Rozanski: Thanks for that question, Mariana. I'm very happy with the PAR acquisition. It's a, you know, sometimes big innovators come in small packages, and this is one of those cases where we were able to find a company and close the transaction with really a car about that really focused. on doing some really innovative edge type work for the war fighter. That fits so well into our entire digital battle space platform and what we're trying to do about integrating information and bringing it together from multiple sources using ultimately artificial intelligence to filter it and giving the war fighter the information he or she needs at the time that they needed in the place that they needed. And so this really will help augment and knit together a number of things that we're doing, and so it's very exciting. We, the basis for this acquisition is not cost reduction, as you said, it's really revenue synergies. And like we've always been saying, this acquisition fits the perspective of strategic acceleration. We're looking for companies that will take what we're doing and allow us to leapfrog both our competitors and our own efforts to be able to move faster and implement both faster.
Speaker Change: Thanks for that question I'm Marianna.
Speaker Change: We're very happy with the <unk> acquisition, it's a sometimes big innovators come in small packages and this is one of those cases, where we were able to find the company and close a transaction with a call we'd really a carve out that that really focuses.
Horacio D. Rozanski: [inaudible] on doing some really innovative edge type work for the warfighter that fits so well into our entire digital battle space platform and what we're trying to do about integrating information and bringing it together from multiple sources, using, ultimately, artificial intelligence to filter it and giving the warfighter the information he or she needs at the time that they need it in the place that they need it. And so this really will help augment and knit together a number of things that we are doing.
Speaker Change: On on doing some really innovative edge type work for the Warfighter that fits so well into our entire digital battle space platform on what we're trying to do about integrating information and bringing it together for multiple sources.
Speaker Change: Using ultimately artificial intelligence to filter it and putting in a given the warfighter.
Speaker Change: Formation, he or she needs at the time that they needed in the place that they need it and so this really will help augment our knit together.
Speaker Change: A number of things that we're doing and.
Horacio D. Rozanski: And so it's very exciting. The basis for this acquisition is not cost reduction, as you said, it's really revenue synergies. And like we've always been saying, this acquisition fits the perspective of strategic acceleration. We're looking for companies that will take what we're doing and allow us to leapfrog both our competitors and our own efforts to be able to move faster and implement VOLT fast. Thank you. And the second one to
Speaker Change: And so it was very exciting we are the basis for this acquisition is not cost reduction as you said, it's really revenue synergies.
Speaker Change: Like we've always been saying this acquisition.
Speaker Change: <unk>.
Speaker Change: Perspective of strategic acceleration.
Speaker Change: We're looking for companies that will take what we're doing and allow us to leapfrog, both our competitors and their own efforts to be able to move faster and implement volt faster.
Horacio Rozanski: Thank you, and the thing I want to note is what makes you confident that you can achieve even a margin for the year in this trend. What are the key milestones that you'll be looking at throughout the year to make sure that you can, or what efforts are you making sure you're putting in place to achieve data percent versus the low times that you print in the quarter. Hey Maria, and I think I'm on a roll. Let me give some context, and then I'll turn it over to Matt, if that's okay. You know, we the primary view that we have is, of course, you know, we're very happy with the top line growth in the quarter. We're not as happy with the bottom line results in this quarter, although, as Matt pointed out, and he'll take you through, this is largely during by timing and one off. So the underlying profitability of the business remains very strong.
Speaker Change: Thank you the thing on one to Matt.
Horacio D. Rozanski: What makes you confident that you can achieve the EBITDA margin for the year in this trend? What are the key milestones that you'll be looking for throughout the year to make sure that you can, or what efforts are you making sure you put in place to achieve the 11% versus the low 10s that you print in the quarter? Hey Mariana, since I'm on a roll, let me give you some context, and then I'll turn it over to Matt if that's okay.
Speaker Change: What makes you confident that you can achieve the EBITDA margins for the year in this trend what are the key milestones that you'll be looking throughout the year to make sure that you can or what efforts are you, making sure you're putting in place such as data of a percent versus the low.
Speaker Change: <unk> that you printed in the quarter.
Hey, Marianne since I'm on a roll let me give some context and then I'll turn it over to Matt if that's okay.
Horacio D. Rozanski: You know, the primary view that we have is, of course, we're very happy with the top-line growth in the quarter. We're not as happy with the bottom-line results in this quarter, although, as Matt pointed out, and he'll take you through this, largely driven by timing and one-offs. So the underlying profitability of the business remains very strong. What gives us the most confidence is the strong momentum that we see in the business. You see it in our book to build, which is exceptional.
Matt: The primary view that we have is of course, you know, we're very happy with the topline growth in the quarter.
Matt: We're not as happy with the bottom line results in this quarter, although as Matt pointed out and it will take you through this is largely driven by timing and one offs. So the underlying profitability of the business remains very strong.
Matthew Calderone: What gives us the most confidence is the strong momentum that we see in the business. You see it in our book to bill, which is exceptional; you see it in our hiring, which is exceptional; you see it in power, which is a great small acquisition for us. And when we put all of that together, we have confidence that we can achieve the objectives for FY 25 and then deliver at the top end of our investment thesis. And I think what's really important is inside all of these numbers, we continue to invest in the things that are making Volt accelerate us because Volt is working. We're waiting not just a lot of work, but the type of work we want, and I'm sure we'll talk more about that. We're attracting exceptional technical talent that probably wouldn't have come to us Alan five years ago, and we're positioning strategically to keep bringing leading edge technology to missions of national importance, which is both an accelerator in the near term but also gives us resiliency at a time of political uncertainty, of budgetary uncertainty, and the like. So, again, is that frame I'll read over to Matt. Yeah, thanks, Rossio. And just to add to that, we talked about this in the past. You know, we managed the business for even that dollars, not margin. So our focus is on how we drive profit dollars up, and then margin will increase as a result. But to take you through first, you know, sort of what drew that to miss in Q1 profit was impacted by a number of factors, both operational and non-operational, that were individually small, but they added up over the quarter. And as Rossio mentioned, and I said in the prepared remarks, a significant portion of these were timing related or non-recurring. Just to go deeper on the operational side, contract low profitability was a touch soft, but the primary driver was a combination of lower client staff utilization and, quite frankly, the pattern of when and how we added client staff over the quarter when they started billing. That cost us about one and a half percent in revenue expilable growth for the quarter on a year-over-year basis, and obviously an equivalent amount of profit dollars. And then on the non-operating side, compared to Q1 last year, we saw higher expenses in a couple of areas, including M&A, busy quarter, legal and regulatory. At the end of the day.
Matt: What gives us the most confidence is this strong momentum.
Horacio D. Rozanski: You see it in our hiring, which is exceptional. You see it in PAR, which is a great small acquisition for us. And when we put all of that together, we are confident that we can achieve the objectives for FY25 and deliver at the top end of our investment thesis. And I think what's really important is that, inside all of these numbers, we continue to invest in the things that are making Volt accelerate us. Because Volt is working.
Speaker Change: That we see in the business you see it in our book to Bill, which is exceptional you see it in our hiring would use exceptional you see it in par, which is a great small acquisition for us and when we put all of that together. We are confident that we can achieve the objectives for FY 'twenty five and then deliver at the top end of it.
Speaker Change: Our investment thesis and I think what's really important to us inside all of these numbers. So we continue to invest in the things that are making volt accelerate us.
Horacio D. Rozanski: We're winning not just a lot of work but the type of work we want, and I'm sure we'll talk more about that. We're attracting exceptional technical talent that probably wouldn't have come to Booz Allen five years ago. And we are positioning strategically to keep bringing leading-edge technology to missions of national importance, which is both an accelerator in the near term but also gives us resilience at a time of political uncertainty, of budgetary uncertainty, and the like. So again, it's that framework.
Speaker Change: Because of all that is working we're winning not just a lot of work, but the type of work we want that I'm sure we'll talk more about that.
Speaker Change: Attracting exceptional technical talent that probably wouldn't have problems was at one five years ago.
Speaker Change: And we are positioning strategically to keep bringing leading edge technology to missions of national importance, which is both an accelerator in the near term, but also gives us resiliency.
Speaker Change: At a time of political uncertainty of budgetary uncertainty.
Speaker Change: Like so so against that frame I'll turn it over to Matt, Yes, Thanks, Ross and just to add to that.
Matthew A. Calderone: I'll turn it over to Matt. Yeah, thanks, Horacio. And just to add to that, Mariana, we've talked about this in the past. We manage the business for EBITDA dollars, not margin. So our focus is on how we drive profit dollars up, and then margin will increase as a result. To take you through the first sort of what drove the miss in Q1, profit was impacted by a number of factors, both operational and non-operating, that were individually small, but they added up over the quarter.
Matt: We've talked about this in the past we manage the business for EBIT dollars not margin. So our focus is on how do we drive profit dollars up and then margin will increase as a result, but to take you through first sort of what what drove the Miss in Q1 profit was impacted by a number of factors.
Matt: Both operational and nonoperational debt.
Matt: That were individually small, but they added up over the quarter.
Matthew A. Calderone: And as Horacio mentioned and I said in the prepared remarks, a significant portion of these were timing-related or non-recurring. Just to go deeper, on the operational side, contract-level profitability was a touch soft, but the primary driver was a combination of lower client-staff utilization and, quite frankly, the pattern of when and how we added client staff over the quarter when they started billing. That cost us about 1.5% in revenue ex-billable growth for the quarter on a year-over-year basis and, obviously, an equivalent amount of profit dollars. And then on the non-operating side, compared to Q1 last year, we saw higher expenses in a couple of areas, including M&A, a busy quarter, legal, and regulatory expenses.
Matt: And as Ross, you mentioned and I said in the prepared remarks.
Ross: A significant portion of these were timing related or nonrecurring just to go deeper on the operational side.
Speaker Change: Contract level profitability was it was a touch soft but the primary driver was a combination of lower client staff utilization and quite frankly, the pattern of women, how we added client staff.
Speaker Change: Over the quarter when they started billing that cost us about one 5% and revenue ex billable growth for the quarter on a year over year basis and obviously.
Speaker Change: An equivalent amount of profit dollars and then on the nonoperating side compared to Q1 last year, we saw higher expenses and a couple of areas, including them in a busy quarter.
Speaker Change: Legal and regulatory expenses, but that said our utilization metrics improved over the quarter and continued to trend up and most important we have the head count we need to meet our fiscal year growth aspirations and really set us up well.
Matthew A. Calderone: But that said, our utilization metrics improved over the quarter and continue to trend up. And most important, we have the headcount we need to meet our fiscal year growth aspirations and really set us up well for the out-years as well. So we're confident we have both the momentum and the operating levers, if needed, to deliver another really strong year on the bottom. Thank you very much.
Speaker Change: For the out years as well so we're confident we have both the momentum and the operating levers if needed to deliver another really strong.
Matthew Calderone: So, we're confident we have both the momentum and the operating lovers, if needed, to deliver another really strong year on the bottom line.
Speaker Change: Year on the bottom line.
Operator: Thank you very much. Thank you. One moment for our next question, please.
Thank you very much.
Operator: Thank you. One moment for our next question, please. And it comes from the line of Sheila Kahyaoglu with Jeffries. Please proceed. Good morning, Horacio, Matt, and Lindsay. Thank you so much.
Speaker Change: Thank you one moment for our next question. Please.
Sheila Kahyaoglu: And he comes from the line of Sheila Kahyaoglu with Jeffries, please proceed.
Sheila Karin Kahyaoglu: He comes from the line of Sheila <unk> with Jefferies. Please proceed.
Sheila Karin Kahyaoglu: So maybe just to continue on that topic, Matt and Horacio, I know you're going to get a lot of questions on this margin. Matt, I don't know if you're willing to quantify that 100 basis point, 130 basis point contraction year over year. How much of that was just timing of the hiring and client utilization versus contract structure and M&A fees, etc.?
Matthew Calderone: Good morning, Horacio and Matt and Lindsay. Thank you so much. So maybe just to continue on that topic, Matt, and Horacio, I know you're going to get a lot of questions on this margin. Matt, I don't know if you're willing to quantify that 100 basis points, 130 basis points. I think you're going to have a great contraction year over year. How much of that was just timing of the hiring and client utilization versus contract structure and emanating, et cetera? Yeah, Sheila, as I just said, the timing of when we had this staff and they became billable, as well as the utilization process, about a point and a half on RevX billable.
Sheila: Good morning, Raphael, Matt and Lindsey. Thank you. So much so maybe just to continue on that topic, Matt and Horacio I know youre going to get a lot of questions on the margin I don't know if youre willing to quantify that 100 basis about 130 basis point.
Speaker Change: Contraction year over year, how much of that was just timing of the hiring in client utilization versus contract structure and M&A et cetera.
Speaker Change: Yes, Sheila as I just said.
Speaker Change: Yeah.
Matthew A. Calderone: The timing of when we added staff and they became billable, as well as utilization, cost us about a point and a half on Rev-X billables. You can do the math. Robert Spingarn, Michael DiPalma, Nathan Rutledge, Booz Allen Hamilton Holding Corp. We probably had an equivalent amount on the non-operating side in terms of One Time in Timing-Related Activity. Okay, sorry if I missed that point and a half. And then, Horacio, maybe I have a bigger picture question for you.
The timing of when.
Speaker Change: When we added staff.
Speaker Change: When they become available as well as utilization cost us about a point and a half on Rev. Ex billable. So you can you can do the math in terms of what that meant from a profit side I would say second contract level.
Matthew Calderone: So you can do the math in terms of what I met from a profit side. You know, it's a second contract level profitability was a little bit soft, and then, you know, we probably had an equivalent amount on the non operating side in terms of, you know, these one time in time related activities.
Speaker Change: Profitability was with a little bit soft and then.
Speaker Change: We probably have an equivalent amount on the on the nonoperating side.
Speaker Change: In terms of.
Speaker Change: These onetime and timing related activities.
Matthew Calderone: Okay, sorry if I missed that point and a half.
Horacio D. Rozanski: You know, I think the defense business and civil have been home runs, double-digit growth, lapping difficult comps. So how are you thinking about the runway for each of those customer segments for the remainder of the year? Sure, you know, I think the good news about the momentum is that it is really broad-based across the portfolio. Our defense business, as I mentioned, won a couple of critical re-competes and really wants some exceptionally important new work in the Pacific that we are very excited about, allowing us to bring technology to a set of missions that we care very much about that the country cares deeply about. So we see strong momentum, and strong performance in our defense business throughout the year, absent some... major disruption which will be industry-wide and nationwide as a result of budgetary pressures in the fall or whatnot.
Speaker Change: Okay, sorry, if I missed that question.
Horacio Rozanski: And then Horacio, maybe a bigger picture question for you: you know, I think the defense business and civil have been homerun doubled as your growth, lapping difficult com. So how are you thinking about the one way of each of those customer segments for the remainder of the year? Sure, you know, I think the good news about the momentum is that it is really broad based across the portfolio. Our defense business, as I mentioned, won a couple of critical recompete and really want some exceptionally important new work in the Pacific that we are very excited about, allowing us to bring technology to a set of missions that we care very much about; the country cares deeply about.
Ralph: And then Ralph maybe a bigger picture question for you I think the defense business and several have been homerun double digit growth lapping difficult comps. So how are you thinking about the runway of the each of those customer segments for the remainder of the year.
Sure I think.
Ralph: The good news about the momentum is that it is really broad based across the portfolio. Our defense business as I mentioned, one a couple of critical Recompete and really want some exceptionally important new work in the Pacific that we are very excited about allowing us to bring technology to a set of missions that we.
Ralph: We care very much about the country cares deeply about so so we see a strong momentum strong performance in our defense business.
Horacio Rozanski: So, so we see strong momentum, strong performance in our defense business really throughout the year absent some major disruption, which will be industry-wide nationwide as a result of, you know, budgetary pressures in the fall or what not. When you go to our civil business, civil, as you said, you know, it's had tremendous growth for a long time. I think this is the 10th consecutive quarter of double-digit growth in our civil business. They won one key recompete; we had the extension of our CDM program, which is great news. And they have some critical recompete in front of them that they're preparing for. We're well positioned by, and they're all centered around bringing technology to key missions.
Ralph: <unk> throughout the year absent some <unk>.
Speaker Change: Major disruption, which will be industry wide nationwide as a result of budgetary pressures in the fall or or whatnot.
Horacio D. Rozanski: When you go to our... Civil business, civil, as you said, has had tremendous growth for a long time. I think this is the 10th consecutive quarter of double-digit growth in our civil business. They won One Key Recompete, and we had the extension of our CDM.
Speaker Change: When you go to our.
Speaker Change: Civil business Civil as you said has had tremendous growth for a long time I think this is the 10th consecutive quarter of double digit growth in our civil business.
Speaker Change: The one one key Recompete, we had the extension of our CDM.
Horacio D. Rozanski: Program, which is great news, and they have some critical re-competes in front of them that they're preparing for; we're well-positioned, by and they're all centered around bringing technology to key missions. So these are places where we can't predict the future, but Booz Allen is very well positioned. And then our intelligence business, even though in the quarter it showed a decline, actually, the underlying momentum in that business is really strong. They want some really important work.
<unk>, which is great news.
Speaker Change: And they have some critical recompete in front of them that that they are preparing forward, we're well positioned.
Speaker Change: By and Theyre, all centered around bringing technology to key missions. So these are places, where we can't predict the future, but booz Allen is very well.
Horacio Rozanski: So, these are places where we can't predict the future, but we found this very well positioned.
Speaker Change: Position, then than our intelligence business, even though in the quarter. It showed.
Horacio Rozanski: And then our intelligence business, even though in the quarter it showed a decline, actually the underlying momentum in that business is really strong. They won some really important work. This is the last quarter of the sort of the tough comp from last year because of the Focus Fox issue that we've talked about extensively, and we see this business growing over the course of the year. But again, importantly, we have transitioned a lot of this business in the last couple of years. First under Judy Dawson, then under Tom Pfeiffer, from delivering excellent intelligence analysis to delivering extraordinary technology that undergirds the accelerated intelligence analysis for the nation.
Speaker Change: A decline actually the underlying momentum in that business is really strong. They won some really important work. This is the last quarter of the sort of a tough comp from last year because of the Ah <unk>.
Horacio D. Rozanski: This is the last quarter of the sort of tough comp from last year because of the Focus Fox issue that we've talked about extensively, and we see this business growing over the course of the year. But again, importantly, we have transitioned a lot of this business in the last couple of years. First under Judy Dodson, then under Tom Pfeiffer, from delivering excellent intelligence analysis to delivering extraordinary technology that undergirds accelerated intelligence analysis for the nation.
Speaker Change: Focus Fox issue that we've talked about extensively and then kind of so and we see this business growing.
Speaker Change: Over the course of the year, but again importantly, we have transitioned a lot of this business in the last couple of years.
Speaker Change: First under Judy adults and then under Tom Pfeiffer from delivering excellent intelligence analysis to delivering extraordinary technology that under gertz. They accelerated intelligence analysis for the nation. So again. This is a business that is sourcing critical talent in and doing good.
Horacio Rozanski: So again, this is a business that is sourcing critical talent and doing good things. And so we expect momentum and growth across the entirety of our markets for the year.
Operator: So again, this is a business that is sourcing critical talent and doing good things. And so we expect momentum and growth across the entirety of our markets for the year. Thank you. Thank you. One moment for our next question. And it comes from the line between Bert Subin and Cecil.
Speaker Change: Things and so we expect the momentum in growth across the entirety of our markets for the year.
Operator: Thank you. Thank you. One moment for our next question.
Thank you.
Speaker Change: Thank you one moment for our next question.
Bert Subin: Any comments from the line of Bert Subin with Cecil? Please proceed. Hey, good morning. Good morning.
Speaker Change: And it comes from the line of Baird <unk> with Stifel. Please proceed.
Bert William Subin: Please proceed. Hey, good morning. Morning, Bert. Morning. Hey, Horacio.
Hey, good morning.
Baird <unk>: Good morning, <unk> morning.
Rossi: Rossi of that.
Matthew Calderone: So the bookings of the quarter were, I would say, unusually strong. You know, if you look at the last few years, sort of in the 1.0 maybe, you know, sort of that range in the first quarter and you're closer to 2.0 in this quarter. Obviously, some good momentum, and I imagine, Matt, some of the comments you made around utilization were just sort of, I guess, now you're going to be getting ready to pursue some of that work. As we think about the second quarter, that's typically your strongest booking quarter over 2.0 on quarterly book-to-bill. Was there some pull forward there?
Speaker Change: So the bookings for the quarter were I would say unusually strong if you look at the last few years sort of in the one dato maybe sort of that range in the first quarter and you're closer to two <unk> in this quarter.
Matt: Obviously, some good momentum and I imagine Matt some of the comments you made around utilization was just sort of I guess now youre going to be getting ready to pursue some of that work as we think about the second quarter. That's typically your strongest booking quarter over to data on a quarterly book to Bill was there some pull forward there or do you think that momentum just keeps building on the on the award side.
Matthew Calderone: Or do you think that momentum just keeps building on the award side?
Matthew Calderone: Thanks for the question, Bert. You know, the way to think about it is there's really strong underlying demand, strong momentum, and a good budget right now. And so, based on those fundamentals, you would expect to see a good demand quarter this quarter. Our tactical sales engine is second to none, as you know, and our ability to take advantage when clients have money in their budgets and missions that matter to them. They take advantage of that opportunity to help them do it, and to sell hard against it is something we've done for years.
Matt: Thanks for the question, Brian you know that the way to think about it is there's really strong underlying demand strong momentum on a good budget right now and so.
Horacio D. Rozanski: So, the bookings for the quarter were, I would say, unusually strong, you know, if you look at the last few years, sort of in the 1.0, maybe, you know, sort of that range in the first quarter, and you were closer to 2.0 in this quarter, obviously, some good momentum, and I imagine, Matt, some of the comments you made around utilization were just sort of, I guess, now you're going to be getting ready to As we think about the second quarter, that's typically your strongest booking quarter over 2.0 on quarterly book-to-bill.
Horacio D. Rozanski: Was there some pull forward there, or do you think that momentum just keeps building on the award side? Thanks for the question, Bert. You know, the way to think about it is there's really strong underlying demand, strong momentum, and a good budget right now. And so... Based on those fundamentals, you would expect to see a good demand quarter this quarter. Our tactical sales engine is second to none, as you know, and our ability to take advantage when clients have money in their budgets and missions that matter to them; they take advantage of that opportunity to help them do it and to sell hard against it is something we've done for years. But I wouldn't say there was any pull forward. I would say, if anything, there was some stuff left over from the prior year that took longer to realize.
Speaker Change: Based on those fundamentals you would expect to see a good demand quarter this quarter.
Speaker Change: Our tactical sales engine is second to none in US you know and our ability to to take advantage when clients have money in their budgets and missions that matter to them. They take advantage of that opportunity to help them do it onto to sell hard against it.
Speaker Change: It's something we've done for years.
Matthew Calderone: You know, I wouldn't say there was any pull forward. I would say if anything, there was some stuff left over from the prior year that took longer to realize. I think what the exact number is going to be this year is ruined by a number of factors. You know, even if we win a lot of work, the large contracts tend to get protested, and your guess is as good as ours as to when something comes off protest. But you know, the realities we have ample demand, we have ample ceiling, and we have the head count to deliver against our commitments for the year.
Speaker Change: I wouldn't say there was any pull forward I would say if anything there was some stuff leftover from the prior year.
Speaker Change: That took longer to realize I think what the exact number is going to be this year is driven by a number of factors.
Horacio D. Rozanski: I think what the exact number is going to be this year is ruined by a number of factors. Even if we win a lot of work, the large contracts tend to get protested, and your guess is as good as ours as to when something comes off protest. The reality is we have ample demand, we have an ample ceiling, and we have the headcount to deliver against our commitments for the year. Got it.
Speaker Change: Even if we win a lot of work the large contracts tend to get protested and your guess is as good as ours as to when something comes off protest.
Speaker Change: You know the reality is we have ample demand we have ample ceiling and we have the head count two to deliver against our commitments for the year.
Matthew Calderone: Got it.
Horacio D. Rozanski: Maybe just to follow up on that point, you mentioned recompetes earlier, Horacio, and you said you've seen some pretty good momentum there in terms of winning your recompetes. You highlighted last quarter that this was a higher than average recompete year. Can you just give us a sense for where we stand? Are you through some of the larger ones you've been watching, or those still out in front of you?
Speaker Change: Got it maybe just a follow up on that point you mentioned re competes earlier Horacio and you said you've seen some pretty good momentum there in terms of winning your re competes.
Horacio Rozanski: Maybe just a follow up on that point. You mentioned recompete earlier, Horacio, and you said you've seen some pretty good momentum there in terms of winning your recompete. You highlighted last quarter that this was a higher than average recompete year. Can you just give us a sense for where we stand, or you threw some of the larger ones you've been watching, or there's still out in front of you. You know, yes and yes, I suppose there's, you know, we built a portfolio that is really enviable in terms of the work that's there, the quality of the work that's there, and how the underlying contracts grow. And when a recompete comes, it is really a recompete plus because it generally comes with additional scope and significant increase in ceilings.
Speaker Change: Highlighted last quarter that this was a higher than average recompete year can you just give us a sense for where you stand are used through some of the larger ones had been watching or are those still out in front of you.
Horacio D. Rozanski: Um, you know, yes and yes, I suppose there is. As you know, we built a portfolio that is really enviable in terms of the work that's there, the quality of the work that's there, and how the underlying contracts grow, and when a recompete comes, it's really a recompete plus because it generally comes with additional scope and a significant increase in ceilings. As you said, we've been through some of those very successfully. There's a few of those left in the year that we obviously want to deliver against.
Speaker Change: You know.
Speaker Change: Yes, and yes, I suppose there is.
Speaker Change: As you know we built a portfolio that is.
Speaker Change: Is really enviable in terms of the the work that they are the quality of the work that's there.
Speaker Change: And how the underlying contracts grow and when a recompete comes is really a recompete plus because it generally comes with additional scope and significant increase in ceilings. As you said we've been through some of those very successfully.
Horacio Rozanski: She said, we've been through some of those very successfully. There's a few of those left on the year that we obviously want to deliver against. We want to win, but importantly, the overall pipeline is really, really healthy at the math point of that. We have a $55 billion pipeline that we're prosecuting actively, and that's up 32% year-over-year. So the demand condition is really good; it's really strong, and we intend to continue to win as much as we can.
Speaker Change: A few of those left in the year that we obviously want to deliver against and we want to win but importantly, the overall pipeline is is really really healthy.
Horacio D. Rozanski: We want to win. But you know, importantly, the overall pipeline is really, really healthy. As Matt pointed out, we have a $55 billion pipeline that we're prosecuting actively, and that's up 32%, year over year. So the demand condition is really good, it's really strong, and we intend to continue to win as much as we can. Thanks, Horacio, and welcome, Lizzie.
Speaker Change: Pointed out we have a $55 billion.
Pipeline that we're prosecuting actively and that's up 32% year over year. So so the demand condition is really good is really strong and we intend to continue to win as much as we can.
Matthew Calderone: Thanks, Horacio, and welcome, Lizzie. Thank you.
Speaker Change: Thanks, Sara and welcome Lindsay.
Lindsay: Thank you.
Horacio D. Rozanski: Thank you. One moment for our next question, which comes from the line of Cai von Rumohr with T.D. Cohen.
Speaker Change: Thank you one moment for our next question that comes from the line of Cai von <unk> with TD Cowen. Please proceed.
Cai Rumohr: A moment for our next question that comes from the line of Kaivon Rumohr with Tidi Kahyaoglu, please proceed. Yes, thank you so much. Matt, you kind of explained what the factors were. I guess I'm kind of interested to know why the factors were.
Operator: Please proceed. Yes, Matt, you kind of explained what the factors were. I guess I'm kind of interested to know why the factors were.
Speaker Change: Yes. Thank you so much so.
Speaker Change: Matt you kind of explained what the factors were I guess I'm kind of interested to know why the factors were y.
Matthew Calderone: Why did you lose the 1.5, because the timing and utilization, because basically you've been talking about using AI, so that you've basically been doing better there until this quarter. And then, secondly, you mentioned the regulatory legal M&A expenses. Those are presumably timing, and how should we think as we look at the next quarter? I mean, are we going to see more of this sort of delay, so the second quarter is still a little disappointing, or does it get a big snapback?
Cai von Rumohr: Why, you know, did you lose the 1.5 because of timing and utilization because basically, you've been talking about using AI so that, you know, you've basically been doing better there until this quarter. And then secondly, you mentioned the regulatory legal M&A expenses. These are presumably timing issues, and how should we think as we look at the next quarter? I mean, are we going to see more of this sort of delay, you know, so the second quarter is sort of still a little disappointing, or does it get a big snapback?
Speaker Change: Did you lose the one five because.
Speaker Change: Yes.
Speaker Change: Timing in utilization, because basically you've been talking about using AI. So you've basically been doing better there until this quarter.
Speaker Change: Then secondly, you mentioned the regulatory legal.
Speaker Change: <unk> expenses those are presumably timing and how should we think as we look at the next quarter. I mean are we going to see more of this sort of delay.
Speaker Change: The second quarter is sort of still a little disappointing or does it get a big snap back in <unk>.
Cai von Rumohr: And thirdly, and I apologize for all these questions, PAR you said was accretive, but if you look at their 10k, it looks like, you know, that this business has a gross margin of about 6%. So how does it become accretive in your numbers?
Matthew Calderone: And thirdly, I apologize for all these questions. Par, you said, is accretive, but if you look at their 10K, it looks like, you know, that this business has a gross margin of about 6%. So how does it become accretive on your numbers? Thanks. Yeah, thanks, Kyle. I'll try to take them in turn, but if I miss one, please, please bring me back. Yeah, first just to dig a little deeper into utilization, and Bart mentioned this, it really was a combination of factors, right? Both prosecuting and ramping up for a significant proposal pipeline, including some meaningful new wins.
Speaker Change: And thirdly, and I apologize for all these questions are are you said, it's accretive but if you look at the 10-K. It looks like you know that this business has a gross margin of about 6%. So how does it become accretive numbers. Thanks.
Matthew A. Calderone: Thanks. Yeah, thanks, Kyle. I'll try to take them in turn. But if I miss one, please. Please bring me back.
Speaker Change: Yeah, Thanks, Kyle ill try to take them in turn but if I Miss one please.
Speaker Change: Please.
Speaker Change: Please bring me back.
Matthew A. Calderone: Right. First, just to dig a little deeper into utilization, and Bert mentioned this, it really was a combination of factors, right? both prosecuting and ramping up for a significant proposal pipeline, including some meaningful new wins. We had some one-off contract-related issues, for example, the delay in funding for Ukraine. More people go out on military leave.
Speaker Change: Brian first just to dig a little deeper into utilization and Bert mentioned this it really was a combination of factors right.
Speaker Change: Both.
Speaker Change: Prosecuting in wrapping up for significant proposal pipeline, including <unk>.
Speaker Change: Some meaningful new wins, we had some one off contract related issues. For example, the delay in funding for Ukraine more people go out and military leave and honestly, we can run the business.
Matthew Calderone: We had some one-off contract-related issues. For example, the delay in funding for Ukraine, more people got in military leave, and honestly, we can run the business, you know, a little tighter. We've been in a pretty heavy investment mode. We remain in investment mode. But our market leaders know what they need to do there. And from the perspective of just when we added staff over the course of the quarter, you know, typically interquarter numbers don't matter, but it happens. Q1 last year, we added a lot of staff early in the quarter, and Q1 this year, not just through the park position, but even organically when staff started, it was towards the back end.
Matthew A. Calderone: And honestly, we can run the business a little tighter. We've been in a pretty heavy investment mode. And we will remain in an investment mode.
Speaker Change: A little tighter we've been in a pretty heavy investment mode. We remain in investment mode.
Matthew A. Calderone: But our market leaders know what they need to do there. And from the perspective of just when we added staff over the course of the quarter. Typically, inter-quarter numbers don't matter, but it happens.
Speaker Change: But our market leaders know what they need to do there and from.
Speaker Change: Perspective, but we're just when we added staff over the course of the quarter typically intra quarter numbers don't matter, but it happens Q1 last year, we added a lot of staff.
Matthew A. Calderone: In Q1 last year, we added a lot of staff early in the quarter. And in Q1 this year, not just through the PAR acquisition, but even organically when staff started, it was towards the back end. So that adds up to about one and a half.
Speaker Change: Early in the quarter in Q1 this year not just through <unk> acquisition, but even organically when when staff started it was towards the back end so that adds up to the one and a half, but but as I mentioned.
Matthew Calderone: So that adds up to the to the one and the half. But, as I mentioned. In response to another question, utilization has been ticking up. We feel good about where that's, where that's headed. On the non-operational side, you're right. You know, a lot of it's one-off or time-related.
Matthew A. Calderone: But as I mentioned, in response to another question, utilization has been ticking up. We feel good about where that's headed. On the non-operational side, you're right, a lot of it's one-off or timing-related.
Speaker Change: In response to another question utilization has been ticking up.
Speaker Change: We feel good about where that's where that's headed.
Speaker Change: On the nonoperational side.
Speaker Change: You know a lot of it's one off timing related and I don't want to get into Q2, but obviously, we feel very comfortable about our ability to deliver the full fiscal year.
Matthew Calderone: You know, I don't want to get into Q2, but obviously we feel, you know, very comfortable at our ability to deliver the full fiscal year. And then on par, we've gotten this question quite a bit. You know, obviously, par itself. Being a company, they had to disclose how they did, how they book out their accounting. I think it'll look somewhat different under our model. We're comfortable that it'll be very mildly accreted this year. Was not bad in year one of an acquisition. And as Rossio said, you know, over time, we think we have the ability to not just generate incremental revenue.
Matthew A. Calderone: I don't want to get into Q2, but obviously, we feel very comfortable about our ability to deliver the full fiscal year. And then on PAR, we've gotten this question quite a bit. Obviously, PAR itself, being a public company, they had to disclose how they broke out their accounting.
Speaker Change: And then on par.
Speaker Change: We've gotten this question quite a bit obviously part self.
Speaker Change: Being a public company they had to disclose how they did how they broke out their accounting I think it will look somewhat different under our model.
Matthew A. Calderone: I think it'll look somewhat different under our model. We're comfortable that it'll be very mildly accretive this year, which is not bad in year one of an acquisition. And as Rossio said, Over time, we think we have the ability to not just generate incremental revenue but margin by adding a lot of the AI and Digital Services we have on top of some of the great stuff they have, like the TAC unit that provides information to warfighters at the edge. So hopefully, did I catch all three? I think I did. Yes, he did.
Speaker Change: We're comfortable that it'll be very mildly accretive this year was not bad in year, one of an acquisition and as Raphael said.
Raphael: Over time, we think we have the ability to.
Raphael: To not just generate incremental revenue, but margin by adding a lot of the AI.
Matthew Calderone: But margin by adding a lot of the The AI and digital services we have on top of some of the great stuff that have like the attack unit that provides information to war fighters at the edge. Hopefully I catch all three. I think I did. Yes, you did.
Raphael: AI in digital services, we have on top to some of some of the great stuff they have like the Tac unit.
Raphael: That provides.
Raphael: Information two war fighters at the edge.
Raphael: So hopefully I did I catch all three I think I did.
Matthew A. Calderone: Thanks so much, Matt. All right, thanks. Thank you. One moment for our next question, that comes from the line of Matt Akers with Wells Fargo. Please proceed. Yeah, hey, good morning, guys.
Raphael: Yes, hi, good thanks, so much Matt alright.
Matthew Calderone: Thanks so much. All right.
Operator: Thanks.
Raphael: Alright. Thanks.
Operator: Thank you.
Speaker Change: Thank you one moment for our next question.
Matt Akers: One moment for our next question that comes from the line of Matt Akers with Wells Fargo. Please proceed. Yeah. Hey. Good morning, guys. Thank you for the question.
That comes from the line of Matt Akers with Wells Fargo. Please proceed.
Matthew Carl Akers: Thank you for the question, Matt. Matt, I wonder if you can comment any more just on how we think about modeling the quarters for the rest of the year because we've got some of these costs going away after Q1. I know you get an easier comparison in the Intel business. I think you commented on the revenue ramp, but just any further color you could provide there. No, I think we provided the right amount of color.
Speaker Change: Yeah, Hey, good morning, guys. Thank you for the question Matt.
Matthew Calderone: Matt, I wonder if you could comment any more just on how we should think about modeling the quarters for the rest of the year because we've got some of these costs going away. After Q1, I know you get to use your compare in the Intel business. I think you commented on the revenue ramp, which any further color you could provide there. No, I think we provided the right amount of color in your thinking about it the right way, Matt. You know, obviously we anticipate profit and margins to be moderately ascending over the back. The remaining three quarters now.
Speaker Change: Matt I Wonder if you can comment any more just on how we should think about modeling the quarters for the rest of the year because we've got some of these costs going away. After Q1, I know you've got an easier compare.
Speaker Change: And the Intel business.
Speaker Change: I think you commented on the revenue ramp and just any any further color you can provide there.
Speaker Change: No I think we provided.
Matthew A. Calderone: And you're thinking about it the right way, Matt. You know, obviously, we anticipate Profit and Martins to be moderately ascending over the back, the remaining three quarters now. And, as you mentioned, our comps will change. Yeah, got it.
Speaker Change: The right amount of color and Youre thinking about it the right way Matt.
Speaker Change: Obviously, we anticipate.
Speaker Change: Profit and margins to be moderately ascending over the back.
Speaker Change: The remaining three quarters now.
Matthew Calderone: And, as you mentioned, our comps will change. Yeah, got it. Okay.
Speaker Change: And as you mentioned, our comps will change.
Matthew A. Calderone: Okay. And I guess any thoughts on pre-cash flow, you know, a decent start to the year, last couple years, you haven't been positive in Q1, Jay's thoughts on, you know, his working capital, where that goes from here, or, you know, just how you're doing. Yeah, we had a good start. I think collections were particularly strong.
Matt: Yeah got it okay, and I guess any thoughts on free cash flow didn't start to the year.
Matthew Calderone: And I guess any thoughts on free cash flow, you know, start the year. Last couple of years, you haven't been positive in Q1. And you know, today thoughts on, you know, it's working capital where that goes from here. You know, just how you're doing there. Yeah, we had a good start. I think collections were particularly strong. As we talked about this past couple calls. You know, we aspire to return to free cash flow conversion rate of 100% or greater. We're on a good vector to get there. Okay.
Speaker Change: The last couple of years, having been positive in Q1, just any thoughts on working.
Speaker Change: Working capital where that goes from here.
Speaker Change: Yes, just how youre doing there.
Matthew A. Calderone: As we talked about on the past couple calls, you know, we aspire to return to a free cash flow conversion rate of 100% or greater and run a good vector to get. Okay, thank you. One moment for our next question, which is from the line of Robert Spingarn with Milius Research. Please proceed. Hi, this is Scott Mikeson on behalf of Rob Spingarn. Matt, you mentioned lower contract profitability in the quarter. I was just wondering if you could provide some color on that.
Speaker Change: Yeah, we had a good start and collections were particularly strong.
Speaker Change: We've talked about this for the past couple of calls.
Speaker Change: We aspire to return to free cash flow conversion rate of 100% or greater.
Speaker Change: Brian a good vector to get there.
Brian: Okay. Thank you.
Operator: Thank you. Thank you. One moment for our next question.
Speaker Change: Thank you one moment for our next question.
Robert Spingarn: And it's from the line of Robert Spingarn with Melius Research. Please proceed.
Speaker Change: And he is from the line of Robert Spingarn with Melius Research. Please proceed.
Matthew Calderone: Guys, this is Scott Micason for Rob Spingarn. Matt, you mentioned lower contract profitability in the quarter. I was just wondering if you could provide color on that. Was it more concentrated in defense, civil, or intel contracts? No, it was just slightly lower than we anticipated. It was spread across the, across the business. No one factor that we're particularly worried about. Okay.
Speaker Change: Hi, This is Scott on for Rob Spingarn.
Speaker Change: Matt you mentioned lower contract profitability in the quarter I was just wondering if you could provide color on that was it more concentrated in defense civil or Intel contract.
unknown: Was it more concentrated in defense, civil, or intelligence contracts? No, it was just slightly lower than we anticipated. Spread across the business, there's no one factor that we're particularly worried about. Okay, and then Horacio, for you, one of the lessons learned from the war in Ukraine is how large quantities of inexpensive drones can have a significant impact on the battlefield. So when we think about programs like the Air Force's CCA program or the DoD's JADC2 initiative, what do you want Booz's role to be in the digital and connected battle space, and how do you take advantage of the trend where hardware becomes increasingly more commoditized, and the value is in the software that drives the hardware?
Speaker Change: No. It was and it was just slightly lower than we anticipated.
Speaker Change: Spread across the across the business no one factor that we're particularly worried about.
Speaker Change: Okay, and then Horacio for you one of the lessons learned from the war in Ukraine is how large quantities of inexpensive trends can have a significant impact on the battlefield. So when we think about programs like the air Force's CCA program or the <unk> initiative.
Horacio Rozanski: And then her idea for you. One of the lessons learned from the war in Ukraine is how large quantities of inexpensive drones can have a significant impact on the battlefield. So when we think about programs like the Air Force's CCA program or the DOD's JADC2 initiative, what do you want Booz's role to be in the digital and connected battle space? And how do you take advantage of the trend where hardware becomes increasingly more commoditized, and the value is in the software that drives the hardware? You know, Scott, we've been on this trend for years, and we've been anticipating it.
Horacio D. Rozanski: What do you want <unk> role to be in the digital and connected battle space and how do you take advantage of that trend where hardware becomes increasingly more commoditized and the value is in the software that drives the hardware.
Horacio D. Rozanski: You know, Scott, we've been on this trend for four years, and we've been anticipating it; we view ourselves as, you know, the primary digital player that can bring information together at speed and scale to the warfighter from headquarters to the edge. And that is an important role that I believe Booz Allen is uniquely positioned to play because of our relationship with tech companies, because of our track record of doing it, because of our own leadership in some leading-edge technologies like AI, like cyber, and because we're making investments.
Scott: Scott we've been on.
Scott: On this trend for four years and we've been anticipating it we view ourselves as you know primary digital player that can bring information together at speed at scale to the Warfighter from headquarters to the edge and that is an important role that I believe booz Allen is uniquely positioned to play because of our <unk>.
Horacio Rozanski: We view ourselves as a primary digital player that can bring information together at speed, at scale, to the war fighter from headquarters to the edge. and that is an important role that I believe Booz Allen is uniquely positioned to play because of our relationship with tech companies, because of our track record doing it, because of our own leadership in some leading-edge technologies like AI, like cyber. And because we're making investments this quarter, we talk about power, but we've been talking about investments that we've been making across the board to make all of this work. And even the work that we're doing in space that I described in the prepared remarks fits into this as well.
Scott: <unk> shipped with tech companies because of our track record doing it because of our own leadership and some leading edge technologies like AI like cyber.
Scott: And because we're making investments this quarter, we talk about par, but we've been talking about investments, how we'd be making across the board to.
Horacio D. Rozanski: This quarter we talk about PAR, but we've been talking about investments that we've been making across the board to make all of this work, and even the work that we're doing in space, which I described in my prepared remarks, fits into this as well. We need to have the ability to persistently look at an environment that's in conflict to understand and anticipate. Threats and take them on in ways that are effective for the type of threat.
Scott: To make all of this work and even the work that we're doing in space that I described in the prepared remarks.
Scott: Fits into this as well we need to have the ability to persistently look.
Horacio Rozanski: We need to have the ability to persistently look at an environment that's in conflict to understand and anticipate threats and to take them all in ways that are effective to the type of threat. As you know, we're doing a lot of work in the Ukraine that informs and teaches us how to do this better, how to help our clients do this better. That work translates then into the work we're doing in the Indo-Pacific, the work we're doing in Sencom. And the work that we're doing across the board in contracts that have to do with readiness and helping our war fighters accelerate their ability to be ready and respond to these kinds of threats.
At an environment, that's in conflict to understand and anticipate.
Scott: Threats and to take them on in ways that are effective to the type of threat.
Horacio D. Rozanski: As you know, we're doing a lot of work in Ukraine that informs and teaches us. How to do this better, how to help our clients do this better, that work translates then into the work we're doing in the Indo-Pacific, the work we're doing in CENTCOM, and the work that we're doing across the board in contracts that have to do with readiness and helping our warfighters accelerate their ability to be ready and respond to these kinds of threats. Thanks for taking the time to answer the question. Sure. Thank you. One moment for our next question, which comes from Noah Poponek with Goldman Sachs. Please proceed. Hi, good morning.
Speaker Change: So you know we're doing.
Speaker Change: A lot of work in the Ukraine that informs and teaches us.
Speaker Change: How to do this better how to help our clients through this better that work translates then into the work we're doing in the Indo Pacific. The work, we're doing in Centcom and the work that we're doing across the board in contracts that have to do with readiness and helping our warfighters accelerate their ability to be ready and respond to these kinds of threats.
Robert Spingarn: Thanks for taking the question.
Speaker Change: Thanks for taking the question.
Operator: Sure, of course. Thank you.
Speaker Change #100: Sure of course.
Speaker Change #101: Thank you.
Noah Poponak: One moment for our next question that comes from Noah Poponek with Goldman Sachs. Please proceed. Hi, good morning. I was wondering if you might spend a minute on medium to long-term margins, where you think profitability can go beyond this year. I know you've talked about, you know, scale and driving revenue growth above the head count growth. And I think also, you've talked about favorable mix with faster growth and some of the more favorably contracted and higher margin, higher to the business. Is that right, or are there offsets to that, and should we be thinking about higher margin over time, or stable margin over time?
Noah <unk>: One moment for our next question that comes from Noah <unk> with Goldman Sachs. Please proceed.
Noah <unk>: Okay.
Noah <unk>: Hi, good morning.
Noah <unk>: Morning.
Noah Poponak: Morning. I was wondering if you might spend a minute on medium to long-term margins, where you think profitability can go beyond this year. I know you've talked about it.
Noah <unk>: I was wondering if you might spend a minute on.
Speaker Change #103: Medium to long term margins.
Speaker Change #104: Where do you think profitability can go beyond this year.
Speaker Change #105: I know you've talked about.
Horacio D. Rozanski: You know, scale and driving revenue growth above headcount growth. And I think also you've talked about favorable mix with faster growth and some of the more favorably contracted and higher margin parts of the business. Is that right, or are there offsets to that, and should we be thinking about higher margins over time or stable margins over time? You know, why don't I start, and then I'm sure Matt will want to add to this.
Speaker Change #106: Scale and driving revenue growth above the head count growth and I think also you have to.
Speaker Change #106: Talked about favorable mix with faster growth in some of them.
Speaker Change #106: More favorably contracted and higher margin parts of the bill.
Speaker Change #106: Business.
Speaker Change #107: Is that right or are there offsets to that and should we be thinking about higher margins overtime or stable margins over time.
Horacio Rozanski: You know, what are nice starts?
Speaker Change #108: Why don't I start and then I'm sure Matt will want to add to this but let me start by saying I'll take us back to the investment thesis.
Horacio Rozanski: And then I'm sure Matt will want to add to this. Let me start by saying, you know, I'll take us back to the investment thesis. About three years ago, when we gave you our outlook, we said we thought margins were going to be in the mid-10s to be able to invest in the business and invest in all of these new technologies that we're going to drive the next wave of growth. In fact, the underlying strength of the business, the underlying profitability of the business has allowed us to both invest at an even higher level organically than we thought.
Horacio D. Rozanski: Let me start by saying, you know, I'll take us back to the investment thesis. About three years ago, when we gave you our outlook, we said we thought margins were going to be in the mid-tens to be able to invest in the business and invest in all of these new technologies that were going to drive the next wave of growth. In fact, the underlying strength of the business, the underlying profitability of the business, has allowed us to both invest at an even higher level organically than we thought and, while preserving our balance sheet capacity, and at the same time, deliver margins in the 11% range, which is, you know, a full half point higher than we anticipated.
Matt: About three years ago, when when we gave you our outlook. We said we thought margins, we're going to be in the mid teens too.
Matt: To be able to invest in the business and invest in all of these new technologies that we're going to drive the next wave of growth.
Matt: In fact, the underlying strength of the business the underlying profitability of the business has allowed us to both invest at an even higher level organically than we thought we would while preserving our balance sheet capacity.
Matthew Calderone: We would, while preserving our balance sheet capacity. And at the same time, deliver margins in the 11% range, which is, you know, a full half point higher than we anticipated. I think over time, the question is, as Matt pointed out, is how quickly can we have EBITDA dollar grows? And that's what we're going to be focused on. There's opportunities in the near term to accelerate that that we're talking about it for this year. But there's opportunities in the long term, especially as outcome-based contracting and some of the other trends that we are anticipating and preparing for.
Matt: And at the same time deliver margins in the 11% range, which is a you know a full half point higher than we anticipated.
Horacio D. Rozanski: I think over time, the question is, as Matt pointed out, how quickly can we have EBITDA dollars grow? And that's what we're going to be focused on. There's opportunities in the near term to accelerate that, and we're talking about it for this year, but there's opportunities in the long term, especially as outcome-based contracting and some of the other trends that we are anticipating and preparing for take more hold for overall profitability to continue to accelerate. Now, exactly when that is going to happen, I'm describing some long-term trends.
I think over time. The question is as Matt pointed out is how quickly can we have EBITDA dollar growth.
Matt: And that's what we're going to be focused on there's opportunities in the near term to accelerate that that we're talking about it for this year, but there's opportunities in the long term, especially as outcome based contracting and some of the other trends that we are anticipating and preparing for.
Horacio Rozanski: They more hold for overall profitability to continue to accelerate. Now, exactly when that is going to happen, I'm describing some long-term trends. to you, I would not want to ascribe that to any given immediate fiscal year, but over the long term, we're very optimistic about Booz Allen's ability to drive above-market profitability growth rates.
Speaker Change #109: They more hold for overall profitability to continue to accelerate now exactly when that is going to happen I'm, describing some long term trends do you I would not want to ascribe that to any given immediate fiscal year <unk>.
Matthew A. Calderone: To you, I would not want to ascribe that to any given immediate fiscal year, but over the long term, we're very optimistic about Booz Allen's ability to drive above-market profitability growth. Okay, I agree. You have the basic, Basic Factors Outlook. You know, the question about our current contract mix and how that evolves. We're generating scale in the business. How do we use that scale?
Speaker Change #109: Over the long term, we're very optimistic about booz Allen's ability too to drive above market profitability growth rates.
Matthew Calderone: I agree. You have the basic factors outlined. It's a question of our current contract mix and how does that evolve? We're generating scale in business; how do we use that scale? And then to what extent can we build more of an outcome-based contracting business? And we said that something we aspire to, a lot of folks in industry aspire to, but that's going to take a while.
Speaker Change #110: Okay I agree.
Speaker Change #111: You have the basic.
Speaker Change #112: Basic basic factors outlined.
<unk> of our current contract mix and how does that evolve.
Speaker Change #112: Yeah.
Speaker Change #112: We're generating scale in the business, how do we use that scale.
Matthew A. Calderone: And then to what extent can we build more of an outcome-based contracting business? And we've said that's something we aspire to. A lot of folks in the industry aspire to do so, but that's gonna take a while. Okay. And with regard to the top line, I guess the total organic revenue growth rate in the quarter is kind of at the high end of the range for the year. The comparisons get a little easier through the rest of the year, I guess. What are the risk factors we should be considering?
Speaker Change #112: And then to what extent can we build more of an outcome based contracting business and we said thats something we aspire to a lot of folks in industry aspire too.
Speaker Change #112: But that's going to that's going to take a while.
Okay.
Horacio Rozanski: Okay. And with regard to the top line, I guess the total organic revenue growth rate in the quarter is kind of a high end of the range for the year. The compares get a little easier through the rest of the year. I guess what are the risk factors we should be contemplating for, you know, what would take you to the low end now with nine months left in the year. I can start, you know, I think obviously environmentally we are we all need to be very mindful of the fact we are very mindful of the fact that this is an election year.
Speaker Change #112: <unk>.
Speaker Change #112: With regard to the top line.
Speaker Change #112: Yes.
Speaker Change #112: Total organic revenue growth during the quarter as kind of a high end of our range for the year.
Speaker Change #112: The compares get a little easier through the rest of the year I guess.
Speaker Change #112: What are the risk factors, we should be contemplating for.
Speaker Change #113: What would take you to the low end now with nine months left in the year.
Horacio D. Rozanski: You know, what would take you to the low end now with nine months left in the year? I can start. You know, I think, obviously, environmentally, we all need to be very mindful of the fact that this is an election year. This is a particularly challenging election environment with, you know, just in the last two or three weeks. The, you know, the picture has changed so many times and, I assume it will continue to change, or it may not, but it's, you know, unpredictable, and that tends to have an impact on the way Congress behaves around passing appropriations bills and continuing resolutions and so forth.
Speaker Change #114: I can start you know I think obviously environmentally we are we all need to be very mindful of the fact that we are very mindful of the fact that this is an election year.
Horacio Rozanski: This is a particularly challenging election environment with, you know, just in the last two or three weeks. You know, the picture has changed so many times, and I assume it will continue to change or may not, but it is unpredictable. And that tends to have an impact on the way Congress behaves around passing appropriations bills and continuing resolutions and so forth. And so we're very mindful of that. We are continuing to monitor it closely and doing all the things we need to do internally to be successful, whether, you know, we have a stable budget environment, which would be ideal, or a more unstable one.
Speaker Change #114: This is a particularly challenging election environment with you know just in the last two or three weeks. The you know the the picture has changed so many times and.
Speaker Change #114: And then I.
Speaker Change #114: I assume it will continue to change or it may or may not but it's you know it is unpredictable and that tends to have an impact on the way Congress behaves around passing appropriations bills, and then continuing resolutions and so forth and so we're very mindful of that we are continuing to monitor it closely and doing all the things we need to do intern.
Horacio D. Rozanski: And so we're very mindful of that. We are continuing to monitor it closely and do all the things we need to do internally to be successful, whether, you know, we have a stable budget environment, which would be ideal or a more unstable one.
Speaker Change #114: Italy.
Speaker Change #114: To be us to be successful.
Speaker Change #114: Whether you know we have a stable budget environment, which would be ideal or a more unstable.
Horacio D. Rozanski: Beyond that, we continue to work on a number of re-competes in the United States, so you would see some impact from that. But on the whole, and in the main, you know, while we're cognizant of the risks and not dismissing any of them at all, we're optimistic. We're optimistic about the year, we're optimistic about our momentum, and we're optimistic about what happens even beyond this. Okay, great.
Horacio Rozanski: Beyond that, we continue to work on a number of recompense that obviously we want to win, and we continue to prosecute a very healthy pipeline, which we hope we will have significant wins in there, which will continue to push and accelerate our business. But if that decelerated, then that you would see some impact on that. But on the whole, on the main, you know, while we're cognizant of the risks and not dismissing any of them at all, we're optimistic. We're optimistic about the year, we're optimistic about our momentum, and we're optimistic about what happens even beyond this year.
Speaker Change #114: One beyond that we continue to work on a number of re competes.
Speaker Change #114: Obviously, we we want to win and we continue to prosecute.
Speaker Change #114: A very healthy pipeline, which.
Speaker Change #114: We hope we will have significant wins in there, which will continue to push and accelerate our business, but if that decelerated then.
Speaker Change #114: You would see some impact on that but on the whole on the main you know, while we're cognizant of the risks and not dismissing any of them at all.
Speaker Change #114: We are optimistic we are optimistic about the year, we're optimistic about our momentum and we're optimistic about what happens even beyond this year.
Horacio Rozanski: Okay, great. Thank you so much.
Speaker Change #115: Okay, great. Thank you so much.
Operator: Thank you.
Operator: Thank you. One moment for our next question that comes from the line of David Strauss with Barclays. Please proceed. Hi, good morning. Thanks for taking the question. This is actually Josh Corn on behalf of David.
Speaker Change #116: Thank you.
David Strauss: One moment for our next question that comes from the line of David Strauss with Barclays. Please proceed. Hi, good morning. Thanks for taking the question.
Speaker Change #117: And for our next question that comes from the line of David Strauss with Barclays. Please proceed.
Josh Corn: Hi, Good morning, Thanks for taking the question. This is actually Josh corn on for David.
Josh Korn: This is actually Josh Korn on for David. So I just wanted to ask how you expect the cost base to break out as a percent of sales this year as compared to last year. So, in other words, COGs, billables, SG&A, thanks. As I mentioned, we've been at a pretty heavy investment phase to support not just growth this year, but into the out years, part of our commitment to be a compounder as we build this business for the long term. So, you know, we continue to invest in the business. We have a lot of work to do in terms of dropping profit to the bottom line.
Josh Corn: So I just wanted to ask how you expect the cost base to break out as a percent of sales this year as compared to last year. So, in other words, COGS, billables, and SG&A. Thanks. Yeah, David, I think we need to... As I mentioned, we've been in a pretty heavy investment phase to support not just growth this year but into the next years. Part of our commitment to being a compounder is that we build this business for the long term.
Josh Corn: So I just wanted to ask how do you expect the cost base to breakout as a percent of sales this year as compared to last year. So in other words Cogs billable as SG&A. Thanks.
David Strauss: Yes, David I think.
David Strauss: As I mentioned, we've been in a pretty heavy investment phase to support not just growth this year, but into the out years as part of our <unk>.
David Strauss: Commitment to be a compound as we build this business for the long term so we.
Josh Corn: So we continue to invest in the business. As I mentioned, we have some operating levers available to us as needed to make sure we deliver the full fiscal year. But Q2 for us really is determinant, to go back to the last question. For many years, we've got a lot of momentum we built in Q1 on the leading indicator side, and little work to do. In terms of dropping profit to the bottom line.
David Strauss: We continue to invest in the business.
David Strauss: Yeah as I mentioned, we have some operating levers available to us as needed.
David Strauss: To make sure we deliver the full fiscal year, but Q2 for us really determinant to go back to the last question in many years, we got a lot of momentum we built in Q1 on the leading indicators side a little work to do.
Matthew A. Calderone: But Q2 really will be important for us this year in setting us up for next year, and we'll adjust our cost basis as appropriate based on what happens. Okay, thank you. Just one for me.
David Strauss: Terms of dropping profit to the bottom line.
Matthew Calderone: But, you know, I think you two really will be, you know, important for us this year. And in terms of, in setting up for next year, and we'll sort of, you know, just our cost basis is appropriate based on what happens.
David Strauss: But Q2 really will be important for us.
David Strauss: This year.
David Strauss: And in terms of setting us up for next year, and we'll sort of adjust our cost basis is appropriate based on what happens.
Matthew Calderone: Okay, thank you. Just one for me.
Speaker Change #120: Okay. Thank you just one for me.
Operator: Thank you. One moment for our next question, please.
Matthew A. Calderone: One moment for our next question, please, and it is from the line of public order with Truist Securities. Please proceed. Thank you. I was hoping you could give us some color on the pace of your hiring, if there are any changes there, and any comparable changing trends in billable headcount retention. Maybe touch on AI skills specifically as part of your answer. Thanks. Hey Toby, I can start.
Speaker Change #122: Thank you for a moment for our next question. Please.
Tobey Sommer: And it's from the line of Tobey Sommer, with true insecurities, please proceed. Thank you. I also hope you could give us some color on the pace of your hiring, if there are any changes there. And any comparable changing trends in billable head count retention, maybe touch on AI skills specifically as part of your answer. Thanks.
Tobey: And he is from the line of Tobey.
Tobey: With tourists Securities. Please proceed.
Tobey: Thank you I was hoping you could give us some color on the pace of your hiring if there are any changes there.
Tobey: And.
any: Any comp.
Speaker Change #124: Comparable changing trends in billable head count retention, maybe touch on AI.
Speaker Change #126: Skilled specifically as part of your answer thanks.
Horacio Rozanski: Hey, Tobey. Oh, I can start. You know, we're over the last couple of years. We did some really important work. Our CEO, Christine Martin Anderson, led some really important work that allowed us to shorten the cycle of both identifying candidate hiring and then making the billable. That's been an exciting development that has allowed us to lean into this market. This is a labor market more strongly, frankly, the work that we are doing is attract people because this is one of the few places. If not the only place where you can do all of this work, integrate all of these capabilities, bring AI to the edge against missions of national importance.
Tobey O'Brien Sommer: You know, over the last couple of years, we did some really important work. Our CEO, Christine Martin-Anderson, led some really important work that allowed us to shorten the cycle of both identifying candidates for hire and then making them billable. That's been an exciting development that has allowed us to lean into this market. This is a good labor market, more strongly, frankly, the work that we are doing. It attracts people because this is one of the few places, if not the only place, where you can do all of this work, integrate all of these capabilities, and bring AI to the edge on missions of national importance.
Speaker Change #125: He told me al.
Speaker Change #125: Sorry.
Speaker Change #127: Uh huh.
Speaker Change #127: Over the last couple of years, we did some really.
The important work our C O Kristine Martin Anderson, let some really important work that allowed us to shorten the cycle.
Speaker Change #127: Both identifying candidates hiring and then making the available that's been unexciting a development that has allowed us to lean into this market. This is a good labor market more strongly frankly, the work that we're doing.
Tobey O'Brien Sommer: And that puts us in a great recruiting position. And our attrition rates are some of the lowest numbers we've seen in many, many years. So, we feel good about where we are. As Matt pointed out last year, we had more hires in April. If you're in June this year, we have more hires in June and fewer in April. But, you know, we don't manage this business by the month.
Speaker Change #128: It attracts people because this is one of the few places if not the only place where you can do all of these work integrate all of these capabilities bring AI to the edge.
Speaker Change #127: Against missions of national importance and that puts us in a great recruiting position and our attrition is some of the lowest numbers we've seen.
Horacio Rozanski: And that puts us in a great recruiting position. And our tradition is some of the lowest numbers we've seen in many, many years. So we feel good about where we are, as Matt pointed out. The last year, we have more hires in April and fewer in June this year. We have more hires in June and fewer in April, but you know, we don't manage this business by the month. We manage the business for the year, and an overall head count growth is on par with what we expected, maybe even a little bit ahead on the AI front.
Speaker Change #127: And in many many years.
Speaker Change #127: So we feel good about where we are as Matt pointed out the last year, we had more hires in April and.
Matt: If you are in June this year, we have more hires in June and if you were in April but you know we don't manage the business by the month, we manage the business for the year.
Horacio D. Rozanski: We'll manage the business for the year, and our overall headcount growth is on par with what we expected, maybe even a little bit ahead on the AI front. I think the same story is true.
Speaker Change #129: And their overall head count growth is on par with what we expected maybe even a little bit ahead on the AI front I think the same story is true we are voltage working we are winning work that is exciting.
Matthew Calderone: I think the same story is true. We are bold is working. We are winning work that is exciting, and it's allowing us to attract talent that in itself creates its own differentiation. And when you put that together with intellectual capital that Booz Allen has, with the track record that we have, it's really a differentiating position. Yeah, just to give you a couple of numbers to build on that, I was talking to Christine last night about this application to Booz Allen in Q1. We're up 33% year over year. And attrition, as Ratio said, we keep calling it historically low, but it's now seven consecutive quarters of historically low attrition.
Horacio D. Rozanski: We are, Volt is working. We are winning work that is exciting. And it's allowing us to attract talent that, in itself, creates its own differentiation. And when you put that together with the intellectual capital that Booz Allen has, and the track record that we have, It's really a differentiating position. Yeah, just to give you a couple numbers to build on that. I was talking to Christine last night about this. Applications to Booz Allen in Q1 were up 33% year over year.
Speaker Change #129: And it's allowing us to attract.
Speaker Change #129: Talent that.
Speaker Change #129: In itself creates its own differentiation and when you put that together with intellectual capital that Booz Allen has with the track record that we have.
Speaker Change #129: It's really a differentiating position.
Speaker Change #129: Yeah, just to give you a couple of numbers to build on that I was talking to Christine.
Speaker Change #130: Last night about this applications to Booz Allen in Q1 were up 33% year over year.
Matthew A. Calderone: And attrition, as Horacio said, we keep calling it historically low, but it's now seven consecutive quarters of historically low attrition. So I think we need to adjust our baseline. It just speaks to the quality of the work we're doing and the quality of our value proposition. I've said it before, but it bears repeating.
Horacio D. Rozanski: And attrition as Horacio said, we keep calling it historically low but it's now seven consecutive quarters of historically low attrition. So I think we need to adjust our baseline it just speaks to the.
Matthew Calderone: So I think we need to adjust our baseline. It just speaks to the quality of the work we're doing and the quality of our value problem.
Speaker Change #131: The quality of the work, we're doing and the quality of our value proposition I've said, it before but it bears repeating.
Louis Dipalma: I said it before, but it bears repeating. You know, slightly over a third of our hires come from employee referrals, and that speaks to the fact that, you know, people who are here not just want to stay here, but they want to refer their friends. I'm going to go to the next question on the queue, come from the line of Louis DiPalma with William Blair. Please proceed.
Matthew A. Calderone: Slightly over a third of our hires come from employee referrals, and that speaks to the fact that people who are here not just want to stay here, but they want to refer their friends. All right, I'm going to go to the next question on the queue, which comes from the line of Louis DiPalma with William Blair. Please proceed. Horacio, Matt, and Lindsay, good morning and congrats on your 110th anniversary. Thanks Louie. Um, three years ago, you guys had a couple of percentage points of exposure to Afghanistan, which was a headwind during the wind down, if I recall correctly.
Speaker Change #132: Slightly over a third of our hires come from employee referrals and that speaks to the fact that people who are here and I just want to stay here, but they want to refer their friends.
Speaker Change #132: Toby.
Toby: Alright, I'm going to go.
Toby: Go to their next question on the queue.
Speaker Change #134: Comes from the line of Louis Dipalma with William Blair. Please proceed.
Horacio Rozanski: Horacio, Matt, and Lindsay, good morning and congrats on your 110-year anniversary. Thanks very much. Three years ago, you guys had a couple of percentage points of exposure to Afghanistan, which was a headwind during the why why down if I recall correctly. And Matt, you mentioned how you were recently impacted by a delay in funding to Ukraine. So, along those lines, can you quantify Booz Allen's exposure to Ukraine if funding for that conflict were to dry up with the new administration? Let me start. I mean, as I mentioned in the preparing marks, we have about 800 people working across European Command, and that's not only Ukraine; that is a very broad base level of support across the entire mission in the entire continent.
Michael Louie D DiPalma: Horacio, Matt and Lindsay good morning, and congrats on your 110 year anniversary.
Laura: Thanks, Laura.
Speaker Change #137: Three years ago.
Michael Louie D DiPalma: You guys had a couple of percentage points of exposure to Afghanistan, which was a headwind during the why wind down if I recall correctly and Matt you.
Michael Louie D DiPalma: And Matt, you mentioned how you were recently impacted by a delay in funding to Ukraine. So along those lines, can you quantify Booz Allen's exposure to Ukraine if funding for that conflict were to dry up with the new administration? Let me start.
Speaker Change #138: <unk> mentioned, how you were recently impacted by a delay in funding to Ukraine.
Speaker Change #138: So along those lines can you.
Speaker Change #138: Can you quantify booz Allen's exposure to Ukraine.
Speaker Change #138: Funding for that conflict, where to dry out with the new administration.
Horacio D. Rozanski: I mean, as I mentioned in the prepared remarks, we have about 800 people working across European command, and that's not only Ukraine. That is a very broad-based level of support across the entire mission, on the entire continent. As Matt mentioned, when we encountered the funding interruption, there may have been.
Speaker Change #139: Let me start I mean.
Speaker Change #140: I mentioned in the prepared remarks, we have about 800 people working across European command.
Speaker Change #140: And that's not only Ukraine that is a very broad base level of support across the entire mission.
Matt: And the entire continent, as Matt mentioned when we one.
Horacio Rozanski: And as Matt mentioned, when we went when there was a the funding interruption, there may have been about 150 of our professionals who could not build to the contract and restart it. I hope that gives you a sense of the exposure against a 35,000 strong footprint. I would view this as almost in the day today, not as an exceptional level of exposure, but then let me flip it on its head, which is to also say the work that we're doing in Ukraine in the for the United States in the Ukraine conflict is extraordinarily important to the nation in that conflict, but also extraordinarily important for what we're learning that we're exporting to our missions across the world.
Speaker Change #141: When the let's say the the funding interruption there may have been.
Horacio D. Rozanski: About a hundred, 150, of our professionals who, Unknown Executive, Mariana Mora, Michael DiPalma, Nathan Rutledge, Booz Allen Hamilton Holding Corp. Restarted, I hope that gives you a sense of the exposure against the 35,000. Unknown Executive, Mariana Mora, Michael DiPalma, Nathan Rutledge, Booz Allen Hamilton Holding, level of exposure, but then let me flip it on its head, which is to also say the work that we're doing in Ukraine, for the United States in the Ukraine conflict is extraordinarily important to the nation in that conflict, but also extraordinarily important for what we're learning, that we're exporting to our missions across the world, and in particular to Indo-PACOM, where, as I've said before, our role, our goal is to be a leading provider of the fusion of information that is going to be required, to be able to deter conflict in that theater.
Speaker Change #142: How about a 100 150.
Speaker Change #143: Oh, our professionals who.
Speaker Change #143: <unk> built through the contract.
Speaker Change #144: Restarted I hope that gives you a sense of the exposure against the 35000 <unk>.
Speaker Change #145: Strong footprint I would view this as almost seem to ask this in the day today are not us an exceptional.
Speaker Change #145: Level of exposure, but then let me flip it on its head which is to also say their work that we're doing in Ukraine.
Speaker Change #146: Indeed for the United States.
Speaker Change #147: You crank conflict is extraordinarily important to the nation in that conflict, but also extraordinarily important for what we're learning that we're exporting to our missions across the world and in particular, two in the pay com, where Ah. So I've said before our role our goal is to be a leading provider of the <unk>.
Horacio Rozanski: And in particular to in the paycom where, as I've said before, our goal is to be a leading provider of the fusion of information that is going to be required to be able to deter conflict in that theater. So, so this is really exciting work. We are very proud of the work; we're very proud of the people we have working there who made a tremendous difference for the country and who have, you know, been working almost literally around the clock now for two years at this level of off tempo. I think more broadly, you know, without positioning against these missions of national importance, make us resilient.
Speaker Change #147: <unk> of information that he is going to be required to be able to deter.
Speaker Change #147: Conflict in that theater. So so this is really exciting work, we're very proud of the work. We're very proud of the people we have working there who've made a tremendous difference.
Horacio D. Rozanski: So this is really exciting work. We are very proud of the work. We're very proud of the people we have working there who've made a tremendous difference for the country and who have, you know, been working almost literally around the clock now for two years at this level of up-tempo. I think more broadly, you know, Booz Allen's positioning against its missions of national importance makes us resilient.
Speaker Change #147: For the country and who are you know been working almost literally around the clock now for two years.
Speaker Change #147: This level of op tempo.
Speaker Change #147: More broadly you know booz Allen's positioning against these missions of national importance make us resilient.
Horacio Rozanski: We believe we're working on things that matter to the country and that transcend administrations, and to sort of end where you started. This is I think why over 110 years we've successfully worked for so many administrations. We have made a difference to the nation and we very much want to continue doing so. While we grow and deliver exceptional resource to our share. Golders.
We believe we're working on things that matter to the country and that transcends administrations into sort of where you started this is I think why over 110 years. We have successfully worked for so many administrations. We have made a difference to the nation and we very much want to continue doing so.
Horacio D. Rozanski: We believe we're working on things that matter to the country and that transcend administrations and sort of end where you started. This is, I think, why, over 110 years, we've successfully worked for so many administrations, we have made a difference to the nation, and we very much want to continue doing so while we grow and deliver exceptional resources to our shareholders. Thanks, Horacio.
Speaker Change #147: While we grow and deliver exceptional resource to our shareholders.
Horacio Rozanski: Thanks, Horacio. I get the sense you're saying that your European command and theater work is very durable. And along on another note, you are obviously one of the largest cyber security service providers.
Speaker Change #147: Thanks, Ross, Yeah, I get the sense here, saying that.
Horacio D. Rozanski: Your European command and theater work is very durable. And on another note, you are obviously one of the largest cyber security service providers. And I think, in September, you're holding a cyber industry day. And I was wondering, has there been any increased demand for your services from the CrowdStrike issue as you deal with the intelligence community and the overall DoD and federal CIV? And also related to cyber security, how are your zero trust implementations progressing? Thanks. Yeah, I'll take this. The specific answer to your question is no, not yet on CrowdStrike.
Speaker Change #148: Your European command in theater work is very durable and along.
On another note.
Speaker Change #149: You are obviously one of the largest cyber security service providers and I think.
Horacio Rozanski: And I think in September, you're holding a Cyber Industry Day. Any increased demand for your services from the CrowdStrike issue, as you deal with the intelligence community and the overall DOD and Federal Civ, and also related to cyber, how are your zero trust implementations progressing? Thanks. Yeah, I'll take this. The specific answer to your question is no, not yet on CrowdStrike, but taking a step back, and you'll hear more about this in September. Really, it's the convergence of the battle space in cyber. We're calling it one battle space across. It's a lot of the same threat actors, a lot of the same threat vectors, a lot of the same dynamics, the application of AI to cyber, both on offense and defense, that span those three.
Speaker Change #150: In September and you're holding a cyber industry day.
Speaker Change #151: And I was wondering has there been any increased demand for your services from that.
Speaker Change #152: The crowd strike issue as you deal with the intelligence community and overall D O D and pedal fifth and and also related to cyber how are your zero Trust.
Speaker Change #153: Implementations progressing thanks.
Speaker Change #154: Yeah I'll take this.
Speaker Change #155: The specific answer to your question is no not yet crowd strike, but taking a step back and you'll hear more about this in September.
Matthew A. Calderone: But taking a step back, and you'll hear more about this in September, really, it's the convergence of the battle space in cyberspace. We're calling it one battle space, right, across.gov,.com, and.mil. It's a lot of the same threat actors, a lot of the same threat vectors, a lot of the same dynamics. The application of AI to cyber, both on offense and defense, that spans those three, that's really driving our current growth and where we think growth is headed in this market. So, we believe we're well positioned for this. Certainly, work may come out of it.
Speaker Change #156: It's the convergence of the battle space, and cyber, but calling it one battle space right across.
Speaker Change #156: Dot Gov Dot Com Dot mill, it's a lot of the same threat actors, but at the same threat vectors, but at the same dynamics the application of AI to cyber both on offense and defense that span those three.
Horacio Rozanski: That's really driving our current growth and where we think growth is headed in this market. So, you know, we believe we're well positioned for this. You know, certainly, you know, work may come out of it. Nothing has happened today. In terms of your specific question, your last question, we're really pleased. Before we had an unfunnered dome. We're seeing matches technically, but in terms of client adoption, a lot of positive momentum there. Yeah, Lou, I'll just run that match answer by saying, you know, the power of old is that we have invested across a broad range of technologies and have leading positions, not just in cyber, in AI, but in even things like quantum, some aspects of space.
Speaker Change #156: That's really driving.
Speaker Change #156: Our current growth and where we think growth is headed in this market.
Speaker Change #156: We believe we're well positioned for this.
Speaker Change #156: Certainly work may come out of it.
Horacio D. Rozanski: Nothing, nothing has happened to date. In terms of your specific question, your last question, we're really pleased with where we're headed on Thunderdome. We're seeing, not just technically, but in terms of client adoption, a lot of positive momentum. Yeah, Lou, I'll just run that Matt's answer by saying, you know, the power of Volt is that we have invested across a broad range of technologies and have leading positions, not just in cyber and in AI but in even things like quantum, some aspects of space.
Speaker Change #156: Nothing nothing has happened to date.
Speaker Change #157: In terms of your.
Speaker Change #157: Your specific question your last question, where we.
Speaker Change #157: We're really pleased with where we're headed on Thunder dome.
Speaker Change #158: Seeing not just technically.
But in terms of client adoption a lot of positive momentum there.
Horacio D. Rozanski: And what we're seeing, and we began to talk about it last September, and without stealing our own thunder, we'll probably talk about it more as it relates to cyber next September, is that these technologies are really all integrating, coming together. It's AI and cyber, AI and space, and increasingly AI and cyber in space, and Booz Allen's ability to span both these markets but also these technology sets puts us in a unique position and gives us optimism for the future. Great Thanks, Horacio. You don't want to steal your own thunderdome,
Speaker Change #159: Yes, I'll just round out matts answer by by saying you know that the power of volt is that we are invested across a broad range of technologies and have leading positions not just cyber and AI, but didn't even things like quantum some aspects of space and what we're seeing and we began to talk about it last September.
Horacio Rozanski: And what we're seeing, and we began to talk about it last September, and without stealing our own thunder, we'll probably talk about it more as it relates to cyber next September. The these technologies are really all integrating coming together. It's AI and cyber, AI and space, and increasingly AI and cyber in space. And whose island's ability to span both these markets, but also these technology sets puts us in a unique position and gives us optimism for the future.
Speaker Change #160: And without stealing your own Thunder, we'll probably talk about it more as it relates to cyber next September.
Speaker Change #160: These technologies are really all integrating coming together, it's AI and cyber AI and space and increasingly AI and cyber and space and Booz Allen's ability to span. Both these markets, but also these technology sets puts us in a unique position and gives us optimism for the future.
Speaker Change #160: Sure.
Operator: Thank you for that, and thank you. And that's all the time we have for Q&A today. Thank you all who participated. And I will pass it back to Horacio Rozanski for his final comment. Thank you.
Horacio Rozanski: Great, thanks for us. You don't want to steal your own thunder dome. Thank you for that. And thank you.
Speaker Change #162: Great. Thanks, Ross, Yeah, you don't want to steal your own Thunder dome.
Speaker Change #161: [laughter], thank you for that.
Speaker Change #160: Okay.
Speaker Change #160: Yes.
Speaker Change #160: Thank you.
Operator: And that's all the time we have for Q&A today.
And Thats all the time, we have for Q&A today, Thank you too.
Horacio Rozanski: Thank you all to hope participated, and I will pass it back to Horace Yorosansky for his final comments. Thank you. And thank you all for your questions and for joining us this morning. I hope this discussion gave you a deeper understanding of our performance and of why we feel confident we will deliver our near and long-term goals.
Speaker Change #160: Who participated and I will pass it back to Horacio Rozanski for his final comments.
Horacio D. Rozanski: And thank you all for your questions and for joining us this morning. I hope this discussion gave you a deeper understanding of our performance and of why we feel confident that we will deliver on our near and long-term goals. Last month, a few of us had the great honor to ring the bell at the New York Stock Exchange. And it was a great moment in our company's long history. And it really reflected our enduring presence and enduring impact.
Horacio D. Rozanski: Thank you and thank you all for your questions and for joining US. This morning I Hope. This discussion gave you a deeper understanding of our performance and why we feel confident we will deliver on our near and long term goals.
Horacio Rozanski: Last month, a few of us had the great honor to ring the bell of the New York Stock Exchange. It was a great moment in our company's long history, and it really reflected our enduring presence and enduring impact. He talked about the future and how we're shaping our own future and the foresight and the agility that had kept us relevant and vibrant for 110 years and looking for 100 engineers more. Ultimately, this event was a testament to an incredible team and to the clients and to the shareholders who have put their trust in Booz Allen to continue to develop exceptional performance, and for that, we are forever grateful.
Speaker Change #163: Last months, a few of US have the great honor to ring the Bell on the New York Stock Exchange.
Speaker Change #163: And it was a great moment in our companies.
Horacio D. Rozanski: Company's long history.
And it really reflected our enduring presence and enduring impact.
Horacio D. Rozanski: He talked about the future and how we're shaping our own future and the foresight and the agility that has kept us relevant and vibrant for 110 years and looking forward to 110 more. Ultimately, this event was a testament to our incredible team and to the clients and to the shareholders who have put their trust in Booz Allen to continue to deliver exceptional performance, and for that, we are forever grateful. And with that, have a great day and a great rest of the summer.
Horacio D. Rozanski: You talked about the future and how we're shaping our own future and the foresight and the agility that has kept us relevant and vibrant.
Horacio D. Rozanski: 410 years, and looking for 110 years more.
Speaker Change #164: Ultimately this event was a testament to our incredible team and to declines and to the shareholders who have put their trust in Booz Allen to continue to develop exceptional performance and for that we are forever grateful.
Horacio Rozanski: And with that, have a great day and a great rest of the summer.
Speaker Change #164: And with that have a great day, and a great rest of the summer.
Operator: And thank you all for participating in today's conference, and you may now disconnect. Thank you very much. .
Horacio D. Rozanski: And thank you all for participating in today's conference, and you may now disconnect. ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? Music Music Music Music Music Music Music Music Music Music Music Music Music, ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music, ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ??
Speaker Change #165: And thank you for participating in today's conference and you may now disconnect.
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Operator: Thank you for your time, and I'll see you next time.
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Operator: In the next episode, we're going to talk about some of the things that we're going to talk about in the next episode We're going to talk about some of the things that we're going to talk about in the next episode I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I know I
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