BigBear.ai Holdings Inc (BBAI) 2023 Q2 法說會逐字稿

Thank you for joining the BigBear.ai second-quarter conference call. This call is being recorded. (Operator Instructions) I will now turn the call over to Norm Laudermilch, Chief Operating Officer. Please go ahead, Mr. Laudermilch.

感謝您參加 BigBear.ai 第二季電話會議。此通話正在錄音。 （操作員指示）我現在將電話轉給營運長 Norm Laudermilch。請繼續，勞德米爾奇先生。

Good afternoon, everyone, and welcome to BigBear.ai's 2023 second-quarter conference call. I'm joined by Mandy Long, our CEO; and Julie Peffer, our Chief Financial Officer.

大家下午好，歡迎參加 BigBear.ai 2023 年第二季電話會議。我們的執行長曼迪朗 (Mandy Long) 也加入了我的行列。和我們的財務長 Julie Peffer。

During the call today, we may make certain forward-looking statements. Listeners are cautioned not to put undue reliance on the forward-looking statements. And BigBear.ai specifically disclaims any obligation to update the forward-looking statements that may be discussed during this call.

在今天的電話會議中，我們可能會做出某些前瞻性陳述。請聽眾不要過度依賴前瞻性陳述。 BigBear.ai 特別聲明不承擔更新本次電話會議期間可能討論的前瞻性陳述的任何義務。

Many factors could cause actual events to differ materially from the forward-looking statements made on the call. These statements are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. For more information about these risks and uncertainties, please refer to the forward-looking statements section of the earnings press release issued today and our SEC filings.

許多因素可能導致實際事件與電話會議中的前瞻性陳述有重大差異。這些陳述是基於當前的預期和假設，因此存在風險和不確定性。有關這些風險和不確定性的更多信息，請參閱今天發布的收益新聞稿的前瞻性聲明部分以及我們向 SEC 提交的文件。

We will also discuss some non-GAAP financial measures during the call today. These non-GAAP financial measures should not be considered a replacement for and should be read together with GAAP results. You can find the GAAP and non-GAAP reconciliations within our earnings release.

我們也將在今天的電話會議上討論一些非公認會計準則財務指標。這些非公認會計原則財務指標不應被視為替代公認會計原則結果，而應與公認會計原則結果一起閱讀。您可以在我們的收益報告中找到 GAAP 和非 GAAP 調整表。

Now, I'd like to turn the call over to Mandy.

現在，我想把電話轉給曼蒂。

Thank you, Norm. And thank you, all, for joining today's call. I'm excited to spend time with you today as the momentum at BigBear.ai continues. We have driven change across our company and are increasingly poised to capture growth opportunities across the markets we service.

謝謝你，諾姆。感謝大家參加今天的電話會議。我很高興今天能與大家共度時光，因為 BigBear.ai 的勢頭仍在繼續。我們推動了整個公司的變革，並越來越準備好抓住我們所服務的市場的成長機會。

We're delivering on our stated goals in this foundational year, improving operational rigor and building momentum in key sectors. And our culture of execution at BigBear.ai is unlocking significant opportunities and win. We've also refreshed our branding, supporting our reintroduction to the market and more closely aligning with the end markets we serve and the solutions we provide.

我們正在實現這一基礎年的既定目標，提高營運嚴謹性並在關鍵領域建立勢頭。 BigBear.ai 的執行文化正在釋放重大機會並贏得勝利。我們也更新了我們的品牌，支持我們重新進入市場，並與我們服務的終端市場和我們提供的解決方案更加緊密地結合。

A key win for us this quarter was being selected as the sole provider by the US Army to implement Phase 2 of the Army Test and Evaluation Command Integrated Mission Management System in a single-award contract worth over $7.7 million over seven months.

我們本季的一個關鍵勝利是被美國陸軍選為唯一供應商，在七個月內價值超過 770 萬美元的單項合約中實施陸軍測試和評估指揮綜合任務管理系統的第二階段。

BigBear.ai will provide a modern, no-code/low-code solution designed to replace ATEC's legacy system with a cloud-based API-centric platform combining project and portfolio management, enterprise content management, workflow management, application integration, and business intelligence, data analytics capabilities. This solution offers the US Army unique and democratize access to data, collaboration tools, and advanced analytics.

BigBear.ai 將提供現代化的無程式碼/低程式碼解決方案，旨在以基於雲端的API 為中心的平台取代ATEC 的舊系統，該平台結合了專案和投資組合管理、企業內容管理、工作流程管理、應用程式整合和商業智能，數據分析能力。該解決方案為美國陸軍提供了獨特且民主化的數據存取、協作工具和高級分析。

What's important to recognize in this extension is that in moving from Phase 1 to Phase 2, the Army selected us as the sole provider after previously sharing the contract. This positions BigBear.ai well as future work is awarded. As we continue to execute, we will see more of these types of contract progressions.

在這次延期中需要認識到的重要一點是，在從第一階段轉向第二階段的過程中，陸軍在之前共享合約後選擇了我們作為唯一的供應商。這為 BigBear.ai 的未來工作奠定了良好的基礎。隨著我們繼續執行，我們將看到更多此類合約的進展。

This award builds upon BigBear.ai's portfolio of work supporting US Army readiness, including its continued delivery of the Global Force Information Management Objective Environment intelligent automation platform. In addition to AIMMS, we received a six-month extension from the US Army as the prime contractor for continuing work on the Global Force Information Management System in a six-month contract valued at just over $8.5 million.

該獎項建立在 BigBear.ai 支援美國陸軍戰備狀態的工作組合之上，包括持續交付全球部隊資訊管理目標環境智慧自動化平台。除了 AIMMS 之外，我們還作為主承包商獲得了美國陸軍的為期六個月的延期，以繼續開展全球部隊資訊管理系統的工作，合約為期六個月，價值剛剛超過 850 萬美元。

The extension builds on BigBear.ai's previous work in Phase 1 and Phase 2 and continues to show the strength of our relationship with the US Army. This is another example of how we are well positioned to win future work.

該擴展建立在 BigBear.ai 之前第一階段和第二階段工作的基礎上，並繼續展示我們與美國陸軍關係的強度。這是我們如何做好準備贏得未來工作的另一個例子。

Under the terms of the single-source contracts, BigBear.ai will serve as a prime contractor to build an enterprise-wide intelligent automation platform, providing the US Army with a holistic view of its global force structure. During the extension, the BigBear.ai team will be charged with migrating the prototype into US Army's cARMY cloud aligned with the US Army's Cloud Plan 2022.

根據單源合約條款，BigBear.ai 將作為主承包商建立企業範圍的智慧自動化平台，為美國陸軍提供其全球部隊結構的整體視圖。在延期期間，BigBear.ai 團隊將負責將原型遷移到符合美國陸軍 2022 年雲端計畫的美國陸軍 cARMY 雲端。

Our ProModel solution continues to enhance our clients' operational efficiency in a variety of use cases. Most recently, we won and expanded work with one of the largest shipbuilders in the world where we are currently supporting US-based naval operation, displaying the global opportunity for leveraging our capabilities in complex manufacturing environment.

我們的 ProModel 解決方案不斷提高客戶在各種用例中的營運效率。最近，我們贏得並擴大了與世界上最大的造船商之一的合作，目前我們正在為美國的海軍行動提供支持，展示了在複雜的製造環境中利用我們的能力的全球機會。

We also won a contract with a large industrial automation company, where we are assisting in their existing flat products fabrication process to identify constraints and understand the best opportunities for eliminating or reducing them. In doing so, our models will allow key stakeholders to quantify the expected improvements and cost benefits of any considered process changes in advance of implementing those changes. We are winning and beating competitors, both large and small, as the world unlocks the power of discrete event simulation and digital twin.

我們還贏得了一家大型工業自動化公司的合同，我們正在協助他們現有的扁平產品製造流程，以確定限制因素並了解消除或減少限制的最佳機會。在此過程中，我們的模型將允許關鍵利害關係人在實施這些變更之前量化任何考慮的流程變更的預期改進和成本效益。隨著世界釋放離散事件模擬和數位孿生的力量，我們正在贏得並擊敗大大小小的競爭對手。

Now I'm going to switch gears and talk about responsible and ethical AI. Earlier this year, we submitted comments to the National Telecommunications and Information Administration and Department of Commerce concerning accountability measures and policies for artificial intelligence systems. Specifically, we sought to provide a perspective on industry experiences related to complex technology regulation and recommendations based on that experience in response to the Biden administration's concerns around accountability measures and policies for artificial intelligence system.

現在我要換個話題，談談負責任和道德的人工智慧。今年早些時候，我們向國家電信和資訊化管理局和商務部提交了有關人工智慧系統問責措施和政策的意見。具體來說，我們試圖提供與複雜技術監管相關的行業經驗的觀點，並根據該經驗提供建議，以回應拜登政府對人工智慧系統問責措施和政策的擔憂。

The rapid acceleration of AI innovation and integration into everyday civil society underscores the importance of ongoing federal efforts to advance trustworthy AI application, research, and US leadership in the development and use of trustworthy AI in the public and private sectors. Furthermore, US leadership and emerging AI systems and applications support a national security strategy that defends core democratic values and protect civil liberties and human rights.

人工智慧創新和融入日常民間社會的迅速加速，凸顯了聯邦持續努力推進可信賴人工智慧應用、研究以及美國在公共和私營部門開發和使用可信任人工智慧方面的領導地位的重要性。此外，美國的領導地位以及新興的人工智慧系統和應用程式支持捍衛核心民主價值並保護公民自由和人權的國家安全戰略。

NTIA is focused on developing sound AI assurance and accountability frameworks and standards. It's a critical component for realizing the benefits of AI and mitigating risk while incentivizing organizations to invest in AI system governance and responsible AI products.

NTIA 致力於開發完善的人工智慧保證和問責框架及標準。它是實現人工智慧優勢和降低風險的關鍵組成部分，同時激勵組織投資於人工智慧系統治理和負責任的人工智慧產品。

We focus our thoughts on the scope of AI accountability mechanisms that should be broad enough to encompass certification, audits, and assessments but also adaptable to evolving technologies and practices. It should involve collaboration between governments, regulatory bodies, industry stakeholders, academia, and civil society to develop comprehensive frameworks that address the challenges and risks associated with AI design, development, and deployment.

我們的重點是人工智慧問責機制的範圍，該機制應該足夠廣泛，以涵蓋認證、審計和評估，但也要適應不斷發展的技術和實踐。它應該涉及政府、監管機構、行業利益相關者、學術界和民間社會之間的合作，以建立全面的框架，以應對與人工智慧設計、開發和部署相關的挑戰和風險。

Additionally, mechanisms should consider international cooperation and harmonization to facilitate consistent standards and practices across borders, while accommodating cultural, legal, and societal differences. AI accountability measures should cover a range of topics to ensure responsible and ethical AI practices.

此外，機制應考慮國際合作和協調，以促進跨國標準和實踐的一致，同時適應文化、法律和社會差異。人工智慧問責措施應涵蓋一系列主題，以確保負責任和道德的人工智慧實踐。

As NTIA continues its work on drafting and issuing a report on AI accountability policy developments, BigBear.ai strongly encourages the development of policies and regulations that support and encourage responsible innovation. To put it simply, we believe in the power that responsible technology can play in regulating technology and believe that today, more than ever, it is not only possible but necessary for AI accountability to be successful.

隨著 NTIA 繼續起草和發佈人工智慧問責政策發展報告，BigBear.ai 大力鼓勵制定支持和鼓勵負責任創新的政策和法規。簡而言之，我們相信負責任的技術在監管技術方面可以發揮的力量，並且相信今天比以往任何時候都更能確保人工智慧問責制取得成功不僅是可能的，而且是必要的。

Lastly, I want to share our excitement on the announcement of our new Chief Technology and Strategy Officer, Ted Tanner. Mr. Tanner has more than 30 years of experience most recently serving as CTO and Chief Architect at IBM Watson Health, now Merative. Ted also has held architect positions at both Apple and Microsoft and has co-founded several acquired startups, including most recently PokitDok acquired by Change Health.

最後，我想分享一下我們對新任首席技術和策略官泰德·坦納 (Ted Tanner) 任命的興奮之情。 Tanner 先生擁有 30 多年的經驗，最近擔任 IBM Watson Health（現為 Merative）的 CTO 和首席架構師。 Ted 也曾在 Apple 和 Microsoft 擔任架構師職位，並共同創立了多家被收購的新創公司，其中包括最近被 Change Health 收購的 PokitDok。

He also created one of the first machine learning and natural language processing-as-a-service companies on Amazon AWS called BeliefNetworks. His extensive experience will be instrumental in delivering technology-led solutions for leaders in government and defense, manufacturing and warehouse operations, and healthcare and life sciences.

他還在 Amazon AWS 上創建了第一批機器學習和自然語言處理即服務公司之一，名為 BeliefNetworks。他的豐富經驗將有助於為政府和國防、製造和倉庫運營、醫療保健和生命科學領域的領導者提供技術主導的解決方案。

As I think about the team that we've assembled over the last year, we've truly experienced the best of both worlds. We've elevated top talent that was already in place at BigBear.ai, and we've added top talent from outside of the company. We are never done evolving, but I feel great about how we're positioned to lead in the AI industry with this team.

當我想到我們去年組建的團隊時，我們真正體驗到了兩全其美。我們提拔了 BigBear.ai 現有的頂尖人才，並從公司外部招募了頂尖人才。我們永遠不會停止發展，但我對我們如何與這個團隊一起在人工智慧產業中處於領先地位感到非常高興。

With that, I will turn the call to Julie for a detailed review of our financials.

這樣，我將致電朱莉，詳細審查我們的財務狀況。

Thank you, Mandy. This past quarter, we executed well in the face of market challenges, including headwinds from the bankruptcy of Virgin Orbit. Additionally, as we make progress on our transformation to a higher-margin technology-led solutions business, we are seeing our contract mix begin to shift and move away from programs like EPASS. EPASS represents a legacy program where we operated as a subcontractor focused on resource staffing for the US Air Force.

謝謝你，曼迪。上個季度，我們在面對市場挑戰時表現出色，包括維珍軌道破產所帶來的阻力。此外，隨著我們向利潤率更高的技術主導解決方案業務轉型取得進展，我們看到我們的合約組合開始發生轉變，並逐漸遠​​離 EPASS 等計劃。 EPASS 代表了一個遺留項目，我們作為分包商運營，專注於美國空軍的資源人員配置。

Despite these headwinds, we delivered on what we set out to achieve. This is a testament to the team we are building and the quality of our solutions and our ability to execute and grow within our markets. If anything, the current geopolitical climate has highlighted the need for advanced technologies like artificial intelligence in our national security efforts. And we are seeing increased interest in our capabilities as a result.

儘管有這些阻力，我們還是實現了我們的目標。這證明了我們正在組建的團隊、我們解決方案的品質以及我們在市場中執行和發展的能力。如果有什麼不同的話，那就是當前的地緣政治氣候凸顯了我們國家安全工作中對人工智慧等先進技術的需求。因此，我們看到人們對我們的能力越來越感興趣。

Now let's turn to quarter results, revenue for the quarter was $38.5 million, up 2% year over year compared to $37.6 million in the second quarter of '22 and up 9% year to date. As always, I want to emphasize that our revenue can be lumpy and can fluctuate meaningfully depending on the quarter in which contracts are awarded, milestones achieved, or contracts complete.

現在讓我們來看看季度業績，該季度的營收為 3,850 萬美元，年增 2%，而 2022 年第二季的營收為 3,760 萬美元，今年迄今成長了 9%。像往常一樣，我想強調的是，我們的收入可能會不穩定，並且可能會根據授予合約的季度、實現的里程碑或完成的合約而大幅波動。

For Q2, year-over-year growth was driven by our US Army GFIM contract, partially offset by the termination of the Virgin Orbit contract and the completion of one phase of our EPASS contract. Total gross margin was 23% in the quarter, a 220-basis-point decrease from 25% in Q2 2022, driven primarily by the loss in revenue and gross margin from Virgin Orbit after their declared bankruptcy in April.

第二季度，年成長是由我們的美國陸軍 GFIM 合約推動的，但部分被 Virgin Orbit 合約的終止和 EPASS 合約一階段的完成所抵消。該季度的總毛利率為 23%，比 2022 年第二季的 25% 下降了 220 個基點，這主要是由於維珍軌道 (Virgin Orbit) 在 4 月宣布破產後收入和毛利率下降。

In terms of this contract, we initially anticipated that the company would be sold quickly, but this has not materialized. So we are taking further action to write off most of what is remaining from the Q1 invoice this quarter, which is reflected in our SG&A expenses.

就這份合約而言，我們最初預計公司會很快被出售，但這並沒有實現。因此，我們正在採取進一步行動，沖銷本季第一季發票中剩餘的大部分資金，這反映在我們的銷售管理費用中。

Backlog was $206 million at the end of the second quarter, which is up 5% or approximately $9 million compared to the first quarter of 2023. This increase is largely driven by awards for the GFIM extension, AIMMS contract, and G3 analytics.

第二季末的積壓訂單為 2.06 億美元，與 2023 年第一季相比成長了 5%，約 900 萬美元。

Now turning to expenses, for Q2, operating expenses were approximately $19.2 million, which included R&D expenses of $2.2 million and SG&A expenses of $16.9 million. We want to highlight that SG&A is down $10 million or 37% versus last year when Q2 SG&A was $27 million.

現在轉向費用，第二季的營運費用約為 1,920 萬美元，其中包括 220 萬美元的研發費用和 1,690 萬美元的 SG&A 費用。我們想強調的是，SG&A 比去年第二季的 SG&A 為 2,700 萬美元減少了 1,000 萬美元，即 37%。

This significant reduction in SG&A was due to the effects of headcount reduction actions taken in third quarter of 2022 and first quarter of 2023 to realign our operating structure in addition to rationalization of our third-party vendor expenses. On a year-over-year basis, total operating expenses were lower by 70% this year in Q2 or 35%, excluding the goodwill impairment expenses in Q2 2022.

SG&A 大幅減少是由於 2022 年第三季和 2023 年第一季為調整我們的營運結構以及合理化第三方供應商費用而採取的裁員行動的影響。與去年同期相比，今年第二季的總營運費用下降了 70%，即 35%，不包括 2022 年第二季的商譽減損費用。

Our net loss was $16.9 million in the quarter versus $56.8 million in Q2 2022. The current quarter includes a $3.1 million non-cash charge related to the fair value adjustments on warrants that were issued in 2023. Additionally, the company booked a bad debt reserve of $675,000 this quarter related to the unpaid receivables from Virgin Orbit.

我們本季的淨虧損為1,690 萬美元，而2022 年第二季為5,680 萬美元。記入了壞帳準備金本季 675,000 美元與維珍軌道的未付應收帳款有關。

Excluding the second-quarter 2022 non-cash goodwill impairment charge of $35.3 million, operating expenses have decreased approximately $10.5 million in Q2 of 2023 versus the comparable period. Similarly, our overall operating loss has improved by approximately 50% and $10 million even after the Q2 2022 goodwill impairment charge is excluded.

不包括 2022 年第二季 3,530 萬美元的非現金商譽減損費用，2023 年第二季的營運費用與可比同期相比減少了約 1,050 萬美元。同樣，即使排除 2022 年第二季的商譽減損費用，我們的整體營運虧損也減少了約 50%，達到 1,000 萬美元。

Adjusted EBITDA was a loss of $3.2 million in Q2 2023 compared to the adjusted EBITDA loss of $7.7 million in the same period a year ago or 58% year-over-year improvement. While we are pleased to report this level of improvement, we remain committed to driving improved operating efficiency in the second half of 2023 and beyond, with a focus on gross margin improvement and continued rigor on operating expenses. Q2 adjusted EBITDA was impacted by the additional bad debt reserve and gross margin loss from Virgin Orbit, partially offset by improved performance on our GFIM contract compared to last quarter.

2023 年第二季調整後 EBITDA 虧損 320 萬美元，而去年同期調整後 EBITDA 虧損 770 萬美元，較去年同期改善 58%。雖然我們很高興地報告這一水平的改善，但我們仍然致力於在 2023 年下半年及以後推動營運效率的提高，重點是毛利率的改善和營運費用的持續嚴格。第二季調整後的 EBITDA 受到 Virgin Orbit 額外壞帳準備金和毛利率損失的影響，但與上季相比，我們的 GFIM 合約業績改善部分抵銷了這一影響。

In reviewing the balance sheet, at the end of the second quarter, we had cash and cash equivalents of approximately $29.9 million. The increase was due to a $22.8 million of net proceeds from the registered direct offering we completed in June. We are also expecting an additional $11 million of government receivables in the quarter that will now come in in Q3 due to the timing of payments. Most of these have already been received.

在審查資產負債表時，第二季末，我們的現金和現金等價物約為 2,990 萬美元。這一增長是由於我們 6 月完成的註冊直接發行獲得了 2,280 萬美元的淨收益。我們也預計本季政府應收帳款將增加 1,100 萬美元，由於付款時間的原因，這些應收帳款現在將在第三季出現。其中大部分已經收到。

As we stated last quarter, we continue to focus on lowering our cash burn in the second half of 2023 to get to positive operational cash flow, which excludes nonrecurring and non-operational items such as interest payments, legal and transaction fees, and tax payments for stock vesting.

正如我們上季度所述，我們繼續致力於在 2023 年下半年降低現金消耗，以實現正營運現金流，其中不包括利息支付、法律費用和交易費用以及稅款等非經常性和非營運項目用於股票歸屬。

Now turning to our financial outlook. Today, we are reaffirming our guidance of expected 2023 revenue in the range of $155 million and $170 million. We continue to expect adjusted EBITDA to be single-digit negative adjusted EBITDA in millions for 2023. As Mandy previously stated, we are doing what we set out to accomplish in 2023, and our momentum continues to build.

現在轉向我們的財務前景。今天，我們重申 2023 年預期收入在 1.55 億美元至 1.7 億美元之間的指引。我們仍預期 2023 年調整後 EBITDA 將為單位數負調整 EBITDA（以百萬計）。

The anticipated GFIM extension, AIMMS award, and continued partnership and expansion with L3Harris gives us increased confidence in our leadership position within AI. With a stronger balance sheet, better operational execution, the right partners, and a talented team in place, we continue to build, and we are looking forward to growth to come.

預期的 GFIM 延期、AIMMS 獎項以及與 L3Harris 的持續合作和擴展讓我們對自己在人工智慧領域的領導地位更有信心。憑藉更強大的資產負債表、更好的營運執行、合適的合作夥伴和優秀的團隊，我們將繼續建設，並期待未來的成長。

And now I turn to Mandy for final remarks before we turn to Q&A.

現在，在我們進行問答之前，我請曼迪做最後的演講。

Thank you, Julie. We have already made a great deal of progress, and I am extremely excited about what we're building and the path ahead.

謝謝你，朱莉。我們已經取得了很大進展，我對我們正在建造的東西和未來的道路感到非常興奮。

Operator, we are ready for questions. Thank you.

接線員，我們準備好回答問題了。謝謝。

(Operator Instructions) Vivek Palani, Northland Capital.

（操作員指示）Vivek Palani，Northland Capital。

Hi. I'm Vivek on for Mike Latimore of Northland Capital. I have a couple of questions with me. And the first one is, what is your headcount, and are you planning on adding more by the year end?

你好。我是 Northland Capital 的 Mike Latimore 的維韋克 (Vivek)。我有幾個問題。第一個是，您的員工人數是多少？

Hi there. Sorry, I missed your name. I missed the name, sorry about that.

你好呀。抱歉，我錯過了你的名字。我錯過了這個名字，對此感到抱歉。

Yeah. I'm Vivek on for Mike Latimore.

是的。我是麥克拉鐵摩爾的維韋克。

Oh, Vivek. I'm sorry, I missed the name. Sorry. Sure. Great. Thank you for the question.

哦，維韋克。抱歉，我忘了名字。對不起。當然。偉大的。謝謝你的提問。

Our headcount, we don't actually release our headcount numbers. But I will say, and I mentioned on the call on my scripted remarks that we are ramping down from a specific contract and ramping up on others that is showing that our headcount is actually coming down right now because of some of those contracts that are heavily weighted toward labor.

我們的員工人數，我們實際上並沒有公佈我們的員工人數。但我要說的是，我在電話會議上按腳本發言時提到，我們正在減少特定合約的數量，並增加其他合約的數量，這表明我們的員工人數現在實際上正在減少，因為其中一些合約嚴重影響了我們的工作。

But that is not a number that we specifically release. We will be growing headcount specifically in some areas based on key investments that we're making. But we're not releasing the specific headcount numbers at this time.

但這不是我們專門發布的數字。我們將根據我們正在進行的關鍵投資，專門在某些領域增加員工人數。但我們目前不會公佈具體的人數。

Okay. My next question is, are you expecting the large phase of GFIMD (sic - GFIM) to get awarded in fourth quarter of this year?

好的。我的下一個問題是，您是否預計 GFIMD（原文如此 - GFIM）的大型階段將在今年第四季獲得批准？

Hi, Vivek. This is Mandy. It's nice to talk with you again. And to build on Julie's previous comments in regards to headcount, we have quite a few open positions right now that we're hiring for specifically related to the contracts that we're executing on and those that are anticipated to transition to GFIM.

嗨，維韋克。這是曼迪。很高興再次與你交談。基於 Julie 先前關於員工人數的評論，我們現在有相當多的空缺職位，我們正在招聘專門與我們正在執行的合約以及預計過渡到 GFIM 的合約相關的職位。

We -- from an expectation standpoint, right, as we look at the extension, that is certainly our hope. I would say as we continue to work with the customer and reflect on timing if there are any updates, right, I think we would certainly share those. But as of right now, yes, that is our current expectation.

我們——從期望的角度來看，對，當我們考慮延期時，這當然是我們的希望。我想說，當我們繼續與客戶合作並反思是否有任何更新的時間時，我想我們肯定會分享這些。但就目前而言，是的，這就是我們目前的期望。

Okay. Thanks. And the last question is -- so where might the gross margins trend in second half of the year?

好的。謝謝。最後一個問題是，下半年毛利率走勢會如何？

Yeah. Great question. Yeah. We saw some headwinds in the first half of the year. I think I talked a little bit about these, but specifically, between some contracts that we're ramping down. And as you recall, we talked about Virgin Orbit coming off our books, and that obviously is creating some headwinds for us in Q2, specifically.

是的。很好的問題。是的。今年上半年我們看到了一些不利因素。我想我談過一些這些問題，但具體來說，是我們正在縮減的一些合約。正如您所記得的，我們談到了維珍軌道從我們的賬簿中刪除，這顯然給我們帶來了一些阻力，特別是在第二季度。

But we actually see that we have some contracts that are ramping down that are lower margin and other contracts that we already are anticipating that are ramping up that are going to give us that better margin in the second half of the year. We're very confident that it's going to improve in the second half of the year. So I can provide a little bit more detail maybe offline, but happy to give you a little bit more of that when we connect later.

但我們實際上看到，我們有一些合約的利潤率正在下降，而我們已經預計其他合約的利潤率正在上升，這將為我們在下半年帶來更好的利潤率。我們非常有信心下半年情況會有所改善。因此，我可以在離線狀態下提供更多詳細信息，但很高興在我們稍後聯繫時為您提供更多詳細信息。

Sure. Thanks a lot.

當然。多謝。

And Vivek, one comment that I'll make, we talked about it a little bit in our opening remarks regarding this particular quarter. But I think it's worth reinforcing that right now, we are in the midst of very deliberately looking for places where we can shift away from businesses that are part of our large portfolio that have margin ceilings towards those with a larger opportunity for margin expansion.

Vivek，我要發表的一個評論是，我們在有關本季的開場白中對此進行了一些討論。但我認為值得強調的是，目前我們正在非常謹慎地尋找可以從我們大型投資組合中具有利潤上限的業務轉向那些有更大利潤擴張機會的業務的地方。

And that's a lot of what I think Julie was really getting at as we look at how we think about how our backlog is changing, how we think about how our mix, right, from a contract basis is changing. We are seeing great indicators, right, in terms of how we look at our mix, our fixed price mix going up quarter over quarter. And I think that those are indications when we look into the second half of the year that I think make us feel good.

我認為朱莉真正理解的是我們如何看待我們的積壓工作如何變化，我們如何看待我們的組合，對的，從合約的基礎上如何變化。我們看到了很好的指標，對吧，就我們如何看待我們的組合而言，我們的固定價格組合逐季上升。我認為，當我們展望下半年時，這些跡象讓我們感覺良好。

(Operator Instructions) Louie DiPalma, William Blair.

（操作員說明）Louie DiPalma、William Blair。

Hi, Louie.

嗨，路易。

Hi, Mandy and Julie. Good afternoon.

嗨，曼迪和朱莉。午安.

Hi, Louie.

嗨，路易。

Yeah.

是的。

And Julie, are you able to quantify the impact of the portion of the EPASS subcontract ending? And are you able to estimate what is the underlying growth of the business excluding this EPASS headwind?

朱莉，您能否量化 EPASS 分包合約終止部分的影響？您能否估計排除 EPASS 不利因素後業務的潛在成長是多少？

Yeah. I mean, it's fair to say that -- so let me give you a little bit of insight specifically on EPASS. Again, EPASS is a legacy program. We were a subcontractor. It really is a two-phase ramp down. So in the quarter specifically, we were notified last quarter that they transitioned EPASS into a new prime and that prime was going with who we used to subcontract through. So that is shifting.

是的。我的意思是，這樣說是公平的——所以讓我專門為您提供一些關於 EPASS 的見解。同樣，EPASS 是遺留程序。我們是分包商。這確實是一個兩階段的斜坡下降。因此，具體來說，在本季度，我們在上個季度收到通知，他們將 EPASS 轉換為新的 prime，並且該 prime 與我們過去分包的公司一起使用。所以這種情況正在改變。

But it's really in two parts. Part of it was completing at the end of Q1; part of it is completing within Q3. So it is going to gradually ramp down over time. But we're not (inaudible) specific information about exactly that it impacts.

但它實際上分為兩部分。部分工作將於第一季末完成；部分工作將在第三季完成。因此，隨著時間的推移，它會逐漸下降。但我們並沒有（聽不清楚）關於其影響的具體資訊。

But this is why I talked about the fact that the quarters can be lumpy depending on when contracts are ramping down and when they're ramping back up. And so you can see that reflected in our results as well as always something that we consider as part of the business.

但這就是為什麼我談到了這樣一個事實：季度可能會不穩定，這取決於合約何時減少以及何時增加。因此，您可以看到這反映在我們的業績中，以及我們始終將其視為業務的一部分。

Great. Thanks, Julie. And Mandy and Julie, congrats on the GFIM six-month extension. Is BigBear expected to be awarded the production GFIM contract at the end of this year? And with the current annual run rate, roughly $17 million, should the production cash run rate roughly double that amount?

偉大的。謝謝，朱莉。曼迪和朱莉，恭喜 GFIM 延長六個月。 BigBear預計會在今年年底獲得GFIM生產合約嗎？以目前的年運轉率約 1700 萬美元，生產現金運轉率是否應該大約是這個數字的兩倍？

So I can take the -- I'll take the first part of that. So from a production award point, as we shared, it was part the extension, right? We're the sole prime vendor included in that. I think it puts us in a great position, right, when we think about what we're doing to deliver value for the customer and so our chances as we look into the production award.

所以我可以接受——我將接受第一部分。因此，從製作獎勵的角度來看，正如我們所分享的，這是延期的一部分，對吧？我們是其中唯一的主要供應商。我認為，當我們考慮我們正在做什麼來為客戶提供價值以及我們在考慮生產獎項時的機會時，這使我們處於有利的位置，對吧。

But ultimately, obviously, as you know, Louie, it's -- the decision lies with the customer, but we will do our best to continue to deliver. And I think that's why we earned the Phase 2 extension.

但最終，顯然，如你所知，Louie，決定權在於客戶，但我們將盡最大努力繼續交付。我認為這就是我們獲得第二階段延期的原因。

Great. And Mandy, you also mentioned how you received the sole-source AIMMS OTA, and that involved like no-code/low-code solution. Is there the potential that like AIMMS can be in the same total contract value size as GFIM? Or how would you like estimate the size for investors on the call?

偉大的。 Mandy，您還提到了您如何收到唯一來源的 AIMMS OTA，以及涉及無代碼/低代碼解決方案。 AIMMS 是否有可能與 GFIM 的合約總價值規模相同？或者您希望如何估計電話會議中投資者的規模？

So I think -- so first, one thing worth noting about what you said is there is definitely a -- I would note a pattern here, right? So as we think about the work that we've done with GFIM and continue to do the work that we're doing in AIMMS, the thing that I would reinforce this thread along those is that we absolutely have a very strong partnership and pattern of success associated with being able to do transformation work associated with core business systems and in a intelligent automation platform form factor.

所以我認為 - 首先，關於你所說的值得注意的一件事是肯定有 - 我會在這裡注意到一個模式，對嗎？因此，當我們思考我們與 GFIM 所做的工作以及繼續在 AIMMS 中所做的工作時，我要強調的是，我們絕對擁有非常牢固的合作夥伴關係和模式成功與能夠進行與核心業務系統和智能自動化平台外形相關的轉型工作相關。

From a size standpoint, we -- I think we expect as most of these happen, right, as you shift from Phase I to Phase II and then into production, the size of the contract goes up significantly. I don't -- we don't have an indication of that total value at this point, but I think safe to assume a similar pattern.

從規模的角度來看，我認為我們預計，隨著大多數情況的發生，當你從第一階段轉向第二階段，然後進入生產時，合約的規模會顯著增加。我不知道——目前我們還沒有總價值的跡象，但我認為可以安全地假設類似的模式。

Great. And another question, with the equity offering, what is the new diluted share count that we should be using?

偉大的。另一個問題是，對於股票發行，我們應該使用的新稀釋股數是多少？

Let me give you that; I've got that handy. Hold on just one second. Share count for the end of the quarter or for the average for the quarter? I can give you both.

讓我告訴你；我有這個方便。請堅持一秒鐘。季度末的股票數量還是季度平均值？我可以給你兩個。

The --

這 -

The ending share count is 155,453, and the average for the quarter is 145,469.

期末股票數量為 155,453 股，本季平均股票數量為 145,469 股。

Great. And one final one, with SG&A continuing to be optimized, is there potential for further cuts into the second half of the year? Or are we currently at the optimal level?

偉大的。最後一個問題是，隨著 SG&A 繼續優化，下半年是否有可能進一步削減？或者我們目前處於最佳水平嗎？

Yeah, I mean --

是的，我的意思是——

It's fair question and what I --

這是一個公平的問題，我——

Go ahead. Sorry, Mandy. Go ahead.

前進。對不起，曼迪。前進。

No problem, Julie. So what I would say is that we are in a very good position right now. And I think we have a lot to be proud of in terms of progress over the last -- I've been in the role for about nine months. The kinds of improvements that we're seeing year over year are significant.

沒問題，朱莉。所以我想說的是，我們現在處於非常有利的位置。我認為就過去的進展而言，我們有很多值得自豪的地方——我擔任這個職位已經大約九個月了。我們逐年看到的改善是顯著的。

And the thing that I'm most proud of in that is that while we've really gotten our operating expenses to good level, we are still growing, right? And I think that it's a testament to the exceptional team that we have, the amount of rigor that we're putting in place associated with how we go after and grow opportunities.

最令我自豪的是，雖然我們的營運支出確實達到了良好的水平，但我們仍在成長，對吧？我認為這證明了我們擁有一支出色的團隊，證明了我們在追求和增加機會方面所採取的嚴格程度。

Now, from a -- how we look at the rest of this year, I do think that we're in a pretty balanced position right now. But we're always going to look for opportunities for further automation, right, and further optimization. And I would say I always reserve the right to (laughter) to get better.

現在，從我們如何看待今年剩餘時間來看，我確實認為我們現在處於一個相當平衡的位置。但我們總是會尋找進一步自動化、正確和進一步優化的機會。我想說我始終保留（笑聲）變得更好的權利。

Yeah. Great -- yeah.

是的。太棒了——是的。

Yeah. Let me add just a little bit to -- just as a reminder, I mean, we committed to deliver $20 million annualized savings last year after (technical difficulty) we did our reductions. And I think if you look at the numbers, right, this would be over $30 million in annualized savings comparison to that Q2 baseline that we established.

是的。讓我補充一點——作為提醒，我的意思是，我們承諾去年在（技術難度）完成削減後實現 2000 萬美元的年化節省。我認為，如果你看一下這些數字，與我們建立的第二季基準相比，年化節省將超過 3000 萬美元。

So as we talked about, we're very proud of the work we've done to get our cost structure back in line to where we are. I would say, even with this improvement, we are committed to continuing to drive improved operating efficiency, and that's going to come over time. And we're going to continue to have rigor within operating expenses.

因此，正如我們所說，我們為使成本結構恢復到現有水平所做的工作感到非常自豪。我想說，即使有了這樣的改進，我們仍致力於繼續提高營運效率，而這將隨著時間的推移而實現。我們將繼續嚴格控制營運費用。

I would not anticipate huge shift, but as Mandy talked about, this is something we're always going to be focused on, and we'll continue to see that in the numbers.

我預計不會發生巨大的轉變，但正如曼迪所說，這是我們始終關注的事情，我們將繼續在數字中看到這一點。

Great. And one final one, there's obviously a lot of excitement associated with generative AI in the market for both federal defense customers and commercial customers. Can you (technical difficulty) how this is impacting your pipeline of award opportunities as you have your own intellectual property here, and how is that translating? Thanks.

偉大的。最後一點，對於聯邦國防客戶和商業客戶來說，市場上的生成式人工智慧顯然令人興奮不已。您能否（技術困難）了解這對您的獲獎機會管道有何影響，因為您在這裡擁有自己的知識產權，這如何轉化？謝謝。

Yeah. Absolutely. I can speak to that. And what I would say is that I think generative AI being one bucket, right, of opportunities where we see interest in our sales that being able to apply. But I would say, Louie, as we look at pipeline and how we're diversifying, it is certainly not limited to that, right?

是的。絕對地。我可以談談。我想說的是，我認為生成式人工智慧是一桶機會，對吧，我們看到我們的銷售對能夠應用的興趣。但我想說，路易，當我們審視管道以及我們如何實現多元化時，它肯定不僅限於此，對吧？

The way that I -- and I think we as a business think about using advanced technologies like this is that there are a variety of different tools in the toolbar. But at the end of the day, our job and how we approach engagements with customers is that we want to understand what problems they're trying to solve, what challenges they're facing. And then we will bring the technology to bear, right, that is crossing that possible and practical line.

我——我認為我們作為一個企業考慮使用這樣的先進技術的方式是工具列中有各種不同的工具。但歸根結底，我們的工作以及我們如何與客戶接觸是我們想要了解他們正在試圖解決什麼問題，他們面臨什麼挑戰。然後我們將把技術運用起來，對吧，這就是跨越可能和實用的界限。

I think what's spectacular about where we are right now as a society is that so many of these capabilities that previously lived in the lab have now crossed both, right, the possible and practical thresholds. And so we are seeing more and more opportunities to bring those in more solutions that we're delivering to our customers.

我認為，作為一個社會，我們現在所處的驚人之處在於，許多以前存在於實驗室的能力現在已經跨越了可能和實際的門檻。因此，我們看到越來越多的機會將這些納入我們為客戶提供的更多解決方案中。

Great. Yeah. I was getting along the lines of how last quarter you discussed the expansion of your partnership with L3Harris for their unmanned surface vessel. You're integrating your software into their platform, and how there's probably other opportunities for similar partnerships. There's a lot of excitement in the market, but thanks.

偉大的。是的。我正在了解上個季度您如何討論擴大與 L3Harris 無人水面艦艇的合作關係。您正在將您的軟體整合到他們的平台中，以及如何可能存在其他類似合作夥伴關係的機會。市場上有很多令人興奮的事情，但謝謝。

Yeah, I think that's all said. And I think you're right. I think there's this interesting intersection that we're seeing emerge between those who are building and have expertise, right, and building and delivering these physical platforms and organizations like BigBear.ai where our superpower lies in software, right, and underlying technology that when put together, right, it was absolutely a differentiator.

是的，我想這就是全部了。我認為你是對的。我認為，我們看到在那些正在建立並擁有專業知識的人之間出現了這種有趣的交集，以及建立和交付這些實體平台和組織（例如BigBear.ai），我們的超級力量在於軟體和底層技術，當放在一起，對吧，這絕對是一個差異化因素。

And so some of the things I see as we look forward, I think we're going to have more opportunities for partnerships where two organizations can come together and say we've got some really complementary stuff and let's combine it and take that to market because it will ultimately benefit the customer.

因此，當我們展望未來時，我認為我們將有更多的合作機會，兩個組織可以走到一起，說我們已經有了一些真正互補的東西，讓我們將其結合起來並將其推向市場因為它最終將使客戶受益。

At this time, there are no further questions. I'd like to turn the call back to management for any closing remarks.

目前，沒有其他問題了。我想將電話轉回給管理階層，讓他們發表結束語。

A huge thank you to everyone for joining and for the wonderful and thoughtful questions. As I shared earlier, I think we have, in the nine months that I've been in this role, really focused on being clear, right, to the broad market around what it is that we're focused on, who we are, and what we're setting out to do. I think this quarter is another great example of what you can rely on from BigBear.ai and this leadership team associated with doing what we said.

非常感謝大家的加入以及提出的精彩而深思熟慮的問題。正如我之前分享的，我認為在我擔任這個職位的九個月裡，我們真正專注於向廣闊的市場明確、正確地了解我們關注的是什麼、我們是誰、以及我們打算做什麼。我認為本季是 BigBear.ai 以及這個領導團隊值得信賴的另一個很好的例子，他們按照我們所說的去做。

And as we look into the second half of this year, we continue to be excited. 2023 has been, from the beginning, right, since I stepped into the role, a foundational year for this organization. The world is changing around us every day as we go through the Fourth Industrial Revolution, and BigBear.ai has all of the parts to play a very significant role in moving that ball forward.

當我們展望今年下半年時，我們仍然感到興奮。自從我上任以來，2023 年從一開始就是這個組織的基礎年。隨著我們經歷第四次工業革命，我們周圍的世界每天都在發生變化，而 BigBear.ai 擁有在推動這一進程中發揮非常重要作用的所有要素。

We look forward to reconnecting with everyone next quarter. Thank you so much.

我們期待下個季度與大家重新聯繫。太感謝了。

Thank you, everyone, for attending today's conference call. This does conclude today's call. You may disconnect. Have a wonderful rest of your day.

感謝大家參加今天的電話會議。今天的電話會議到此結束。您可以斷開連線。祝您有個愉快的一天。