Innovative Solutions and Support Inc (IA) 2026 Q1 法說會逐字稿

Good day, and welcome to the Innovative Aerosystems first-quarter fiscal 2026 financial results conference call. (Operator Instructions) Please note this event is being recorded.

大家好，歡迎參加創新航空系統公司2026財年第一季財務業績電話會議。（操作說明）請注意，本次活動正在錄影。

I would now like to turn the conference over to Paul Bartolai, partner at Vallum Advisors. Please go ahead.

現在我將把會議交給 Vallum Advisors 的合夥人 Paul Bartolai。請繼續。

Thank you. Good morning, everyone, and welcome to Innovative Aerosystems first-quarter fiscal 2026 results conference call. Leading the call today are our CEO, Shahram Askarpour; and CFO, Jeff DiGiovanni. This morning, we issued a press release detailing our fiscal 2026 first quarter operational and financial results. This release is publicly available in the Investor Relations section of our corporate website at www.iascorp.com.

謝謝。各位早安，歡迎參加創新航空系統公司2026財年第一季業績電話會議。今天主持電話會議的是我們的執行長 Shahram Askarpour 和財務長 Jeff DiGiovanni。今天上午，我們發布了一份新聞稿，詳細介紹了我們 2026 財年第一季的營運和財務表現。本新聞稿可在本公司網站 www.iascorp.com 的投資人關係欄位中公開查閱。

I would like to remind you that management's commentary and responses to questions on today's conference call may include forward-looking statements, which, by their nature, are uncertain and outside of the company's control. Although these forward-looking statements are based on management's current expectations and beliefs, actual results could differ materially. For a discussion of some of the factors that could cause actual results to differ, please refer to the Risk Factors section of our latest reports filed with the SEC.

我想提醒各位，管理層在今天電話會議上的評論和對問題的回答可能包含前瞻性陳述，這些陳述本質上是不確定的，並且超出公司的控制範圍。儘管這些前瞻性陳述是基於管理階層目前的預期和信念，但實際結果可能與預期有重大差異。有關可能導致實際結果出現差異的一些因素的討論，請參閱我們向美國證券交易委員會提交的最新報告中的「風險因素」部分。

Additionally, please note that you can find reconciliations of all historical non-GAAP financial measures mentioned on this call in the press release issued this morning. Today's call will begin with prepared remarks from Shahram, who will provide a review of our recent business performance and an update on our strategic framework, followed by a financial update from Jeff. At the conclusion of these prepared remarks, we will open the line for your questions.

此外，請注意，您可以在今天早上發布的新聞稿中找到本次電話會議中提到的所有歷史非GAAP財務指標的調整表。今天的電話會議將首先由 Shahram 發表準備好的講話，他將回顧我們最近的業務表現並介紹我們的戰略框架的最新情況，隨後 Jeff 將帶來財務方面的最新進展。在這些準備好的發言結束後，我們將開放提問環節。

With that, I'll turn the call over to Shahram.

接下來，我將把電話交給沙赫拉姆。

Thank you, Paul, and good morning to everybody joining us on the call today. I'm pleased to report that we delivered a strong start to our fiscal year 2026, one driven by organic growth across revenue, net income, adjusted EBITDA, as well as exceptional free cash flow generation.

謝謝保羅，也祝福今天所有參加電話會議的朋友們早安。我很高興地報告，我們在 2026 財年取得了強勁的開局，這得益於收入、淨利潤、調整後 EBITDA 的有機增長，以及出色的自由現金流產生。

First-quarter revenue grew 37% versus the prior year period on increased commercial aftermarket demand and service activity, while adjusted EBITDA grew 141%, reflecting a more favorable revenue mix and improved operating leverage consistent with our strategic focus.

由於商業售後市場需求和服務活動增加，第一季營收比去年同期成長了 37%，而調整後的 EBITDA 成長了 141%，這反映出更有利的收入結構和改善的營運槓桿，與我們的策略重點一致。

We continued to make important progress under our IA Next, long-term valuation creation strategy during the first quarter, keeping us on track to deliver both on our near-term and long-term financial targets. As a reminder, our IA Next strategy prioritizes profitable growth, sustained operational excellence, and disciplined capital allocation as key drivers of long-term value creation.

第一季度，我們在 IA Next 長期估值創造策略下繼續取得重要進展，使我們能夠按計劃實現近期和長期財務目標。再次提醒大家，我們的 IA Next 策略優先考慮獲利成長、持續卓越營運和嚴謹的資本配置，作為長期價值創造的關鍵驅動因素。

This strategy forms the foundation that will enable us to deliver on our long-term target of $250 million in revenue and adjusted EBITDA margins between 25% to 30% through a combination of both organic and inorganic growth. During the first quarter, we completed all required recertification and resumed full-scale production of the digital flight control computer in support of the F-16 program at our Exton facility as planned.

這項策略將為我們實現長期目標奠定基礎，即透過有機成長和無機成長相結合，實現 2.5 億美元的收入和 25% 至 30% 的調整後 EBITDA 利潤率。第一季度，我們按計劃完成了所有必要的重新認證，並在埃克斯頓工廠恢復了F-16項目所需的數位飛行控制計算機的全面生產。

The recertification and resumption of production of the improved programmable display generator is planned for the current quarter, and we will continue to be optimistic regarding the long-term growth potential of this platform. The F-16 remains a critical asset for our military as well as many of our allies across the world and we remain encouraged by the long runway of growth we see ahead.

改進型可編程顯示生成器的重新認證和恢復生產計劃在本季度進行，我們將繼續對該平台的長期成長潛力保持樂觀。F-16 仍然是我們軍隊以及世界各地許多盟友的重要資產，我們對未來漫長的成長前景感到鼓舞。

In addition, we still expect to begin in-sourcing the F-16 product line subassemblies in late 2026. This initiative should contribute to improved and more consistent margins related to these products moving forward.

此外，我們仍預計將於 2026 年底開始將 F-16 產品線子組件的生產收回國內。這項措施應該有助於提高這些產品未來相關的利潤率，並使其更加穩定。

While we are excited by the opportunity for our F-16 platform, we also remain encouraged by the growth potential for our broader defense business. We have made significant investments to position our business as a mission-critical partner with the defense supply chain and believe that our investments, certifications, and relationships, together with a strong backdrop for defense spending stand to benefit IA given our deep inside the cockpit expertise.

雖然我們對 F-16 平台的機會感到興奮，但我們也對我們更廣泛的國防業務的成長潛力感到鼓舞。我們已投入巨資，將公司定位為國防供應鏈的關鍵合作夥伴，並相信憑藉我們在駕駛艙內部的深厚專業知識，我們的投資、認證和關係，以及國防開支的強勁背景，將使 IA 受益。

At a product level, we continue to advance our progress towards autonomous flight through our next-generation flight deck Liberty with our UMS. Recall that the UMS is an advanced aircraft systems management platform designed to monitor and control multiple aircraft subsystems from flight controls to environmental and power systems in a unified intelligent architecture. We have completed test flights with our new UMS platform on the Pilatus PC-24 and more recently, have begun unit production. We expect to begin delivering the new version to Pilatus in mid-2026.

在產品層面，我們透過下一代飛行甲板 Liberty 和我們的 UMS 繼續推動自主飛行。請記住，UMS 是一個先進的飛機系統管理平台，旨在透過統一的智慧架構來監控和控制從飛行控製到環境和電力系統的多個飛機子系統。我們已經完成了在皮拉圖斯PC-24飛機上使用新型UMS平台的試飛，並且最近已經開始進行單機生產。我們預計將於 2026 年中開始向 Pilatus 交付新版本。

As it relates to inorganic growth, we remain focused on pursuing complementary accretive acquisitions that expand our capabilities, increase our content per aircraft, position us to realize significant recurring revenue streams, and that increase our access to proprietary IP and technologies that enhance our unique value proposition.

就非內生成長而言，我們仍然專注於尋求互補的增值收購，以擴大我們的能力，增加每架飛機的內容，使我們能夠實現重要的經常性收入流，並增加我們獲得專有知識產權和技術的機會，從而增強我們獨特的價值主張。

Historically, for those less familiar, our approach has centered on an acquiring aerospace and defense avionics product lines or businesses with significant aftermarket potential. As we enter 2026, our acquisition pipeline has become increasingly active, and we continue to evaluate a number of potential opportunities. We remain disciplined in our approach, focusing on transactions that advance our strategic objectives, and we look forward to updating you on our progress.

對於不太了解的人來說，從歷史上看，我們的方法一直以收購具有重大售後市場潛力的航空航太和國防航空電子產品線或業務為中心。進入 2026 年，我們的收購計劃變得越來越活躍，我們將繼續評估許多潛在的收購機會。我們將繼續秉持嚴謹的態度，專注於推動我們策略目標的交易，並期待向您報告我們的進展。

In summary, fiscal 2026 is off to a strong start with solid operating results and continued progress across our strategic initiatives. We remain committed to our long-term strategy with an ongoing focus on delivering value for our shareholders, much as we have in the recent years.

總而言之，2026 財年開局強勁，營運表現穩健，各項策略措施也持續取得進展。我們將繼續致力於長期策略，並像近年來一樣，持續專注於為股東創造價值。

With that, I'll turn the call over to Jeff for his prepared remarks.

接下來，我會把電話交給傑夫，讓他發表事先準備好的演講。

Thank you, Shahram, and good morning to all those joining us. Today, I will provide a high-level overview of our first quarter performance, including a discussion of working capital, our balance sheet and our liquidity profile at quarter end, and conclude with comments on our outlook for the business, which remains positive given current demand conditions.

謝謝沙赫拉姆，也祝各位早安。今天，我將對我們第一季的業績進行高層次的概述，包括對季度末營運資本、資產負債表和流動性狀況的討論，最後對業務前景發表一些評論，鑑於目前的需求狀況，我們的業務前景依然樂觀。

We generated net revenues of $21.8 million in the first quarter, up 36.5% from the first quarter last year, driven by growth in our commercial aftermarket business and higher services revenues. As Shahram discussed, we resumed full-scale production of the digital flight control computer in support of the F-16 at our Exton facility during the first quarter. The recertification and resumption of production of the improved programmable display generator is planned for the current quarter.

第一季度，我們實現了 2,180 萬美元的淨收入，比去年同期成長了 36.5%，這主要得益於商業售後市場業務的成長和服務收入的提高。正如沙赫拉姆所討論的那樣，我們在第一季度恢復了在埃克斯頓工廠為 F-16 提供數位飛行控制電腦的全面生產。改進型可編程顯示生成器的重新認證和恢復生產計劃在本季度進行。

That said, revenue during the first quarter was negatively impacted by this manufacturing transition with our F-16 revenues down modestly from last year by approximately $1.2 million. However, we remain on track for a ramp in our F-16 revenues as we move through the year.

儘管如此，第一季的營收還是受到了這種生產轉型帶來的負面影響，我們的 F-16 營收比去年同期略微下降了約 120 萬美元。但是，隨著年內推進，我們的 F-16 收入仍有望成長。

Additionally, we faced some temporary headwinds in our business jet markets as we gear up to migrate Pilatus to our new UMS2 platform, thus leading to a decline in revenues of approximately $1 million during the quarter, while this transition moves through production.

此外，由於我們正在準備將 Pilatus 遷移到我們新的 UMS2 平台，我們的公務機市場也面臨一些暫時的不利因素，因此，在過渡到生產階段期間，本季收入下降了約 100 萬美元。

Product sales were $13.6 million during the first quarter, up from $10 million during the same period last year, driven primarily by stronger volumes of aftermarket product upgrades to commercial market that include UPS and air transport. Service revenue was $8.2 million, up from $6 million in the same period last year due to growth in service volumes related to the IRUs and radio products line, partially offset by a small decline with our legacy service customers.

第一季產品銷售額為 1,360 萬美元，高於去年同期的 1,000 萬美元，主要得益於包括 UPS 和航空運輸在內的商業市場售後產品升級銷售的強勁成長。服務收入為 820 萬美元，高於去年同期的 600 萬美元，這主要得益於 IRU 和無線電產品線相關服務量的增長，但部分被傳統服務客戶的小幅下降所抵消。

Gross profit was $11.9 million during the first quarter, up from $6.6 million reported in the same period last year, an increase of 80%. The strong growth was driven by increases in revenue and a more favorable mix of products within our Commercial Aftermarket business. As a result, our first-quarter gross margin was 54.5%, up from 41.4% in the same period last year.

第一季毛利為 1,190 萬美元，高於去年同期報告的 660 萬美元，增幅達 80%。強勁成長主要得益於商業售後市場業務收入的增加和產品組合的最佳化。因此，我們第一季的毛利率為 54.5%，高於去年同期的 41.4%。

As we have stated in recent quarters, we continue to expect our gross margins to be in the mid-40% range over the course of the year, with some quarterly fluctuations based on mix, especially as we continue to grow our military and OEM businesses. Commercial Aftermarket, which by nature has higher gross margins as compared to Military and OEM businesses, increased approximately $5 million over the prior year quarter.

正如我們最近幾季所聲明的那樣，我們預計今年的毛利率將保持在 40% 左右，但會根據產品組合出現一些季度波動，尤其是在我們繼續發展軍工和 OEM 業務的情況下。與軍工和 OEM 業務相比，商業售後市場本身毛利率就較高，因此與去年同期相比增長了約 500 萬美元。

Operating expenses during the first quarter of 2026 was $5.6 million, an increase from $5.3 million during the same period last year despite our strong revenue growth. Operating expenses as a percentage of revenue were 25.6% compared to 33% in the same period last year. The increase in operating expenses was primarily driven by investments to support growth, including the additional headcount in engineering, sales and services as we have highlighted in recent calls, offset by lower depreciation and amortization expense.

儘管營收成長強勁，但2026年第一季的營運費用為560萬美元，比去年同期的530萬美元有所增加。營業費用佔收入的百分比為 25.6%，去年同期為 33%。營運費用的增加主要是由於支持成長的投資，包括工程、銷售和服務部門增加人員，正如我們在最近的電話會議中所強調的那樣，但被較低的折舊和攤銷費用所抵消。

Net income for the quarter was $4.1 million as compared to $700,000 last year. GAAP earnings per diluted share of $0.22 increased from $0.04 last year. Adjusted net income, which includes the same adjustments made to adjusted EBITDA in addition to an adjustment for amortization of acquired intangibles was $4.5 million for the quarter as compared to $1.6 million last year.

本季淨收入為 410 萬美元，而去年同期為 70 萬美元。以美國通用會計準則計算，每股攤薄收益為 0.22 美元，高於去年的 0.04 美元。經調整後的淨收入（包括對經調整後的 EBITDA 進行的相同調整，以及對收購的無形資產攤銷的調整）為本季 450 萬美元，而去年同期為 160 萬美元。

Adjusted earnings per diluted share of $0.25 increased from $0.09 last year. Adjusted EBITDA was $7.4 million during the first quarter, up from $3.1 million last year, an increase of 140.9%, largely due to our revenue growth and a more favorable revenue mix.

調整後的每股攤薄收益為 0.25 美元，高於去年的 0.09 美元。第一季調整後 EBITDA 為 740 萬美元，高於去年同期的 310 萬美元，增幅達 140.9%，主要歸功於我們的營收成長和更有利的營收結構。

Moving on to backlog. New orders in the first quarter of fiscal 2026 were approximately $19 million and backlog as of December 31 was approximately $75 million. Backlog represents the value of contracts and purchase orders less the revenue recognized to date on those contracts and purchase orders. The backlog includes committed purchases and excludes potential future sole-source production orders from products developed under the company's engineering development contracts programs.

接下來處理積壓的工作。2026 財年第一季新訂單金額約 1,900 萬美元，截至 12 月 31 日的積壓訂單金額約為 7,500 萬美元。積壓訂單代表合約和採購訂單的價值減去迄今為止已確認的合約和採購訂單的收入。積壓訂單包括已承諾的採購訂單，但不包括公司工程開發合約計畫下開發的產品的潛在未來單一來源生產訂單。

Now turning to cash flow. During the first quarter, cash flow from operations was $8.2 million compared to $1.8 million in the year ago comparable period, driven by our solid operating results and financial discipline. Capital expenditures during the first quarter of 2026 were $1.1 million versus $300,000 in the year ago period.

現在來看現金流。第一季度，由於我們穩健的經營業績和財務紀律，經營活動產生的現金流量為 820 萬美元，而去年同期為 180 萬美元。2026 年第一季的資本支出為 110 萬美元，而去年同期為 30 萬美元。

Despite the increase in capital spending primarily related to the building expansion compared to last year, free cash flow was $7 million during the first quarter, up from $1.6 million in the previous year. Our strong free cash flow reflects the limited capital needed to grow our business, which results in strong free cash flow conversion.

儘管與去年相比，資本支出有所增加，主要與建築擴建有關，但第一季的自由現金流為 700 萬美元，高於去年的 160 萬美元。我們強勁的自由現金流反映了我們業務成長所需的有限資本，從而實現了強勁的自由現金流轉換率。

At the end of the first quarter of 2026, we had total debt of $23.8 million and cash and cash equivalents of $8.3 million, resulting in net debt of $15.5 million. As of December 31, 2025, we had total cash and availability under our credit line of approximately $83.3 million. Our net leverage at the end of the quarter was 0.5 times. Our modest leverage, combined with our availability under our expanded credit facility gives us significant financial flexibility to execute on our strategic initiatives.

截至 2026 年第一季末，我們的總負債為 2,380 萬美元，現金及現金等價物為 830 萬美元，淨負債為 1,550 萬美元。截至 2025 年 12 月 31 日，我們的現金總額和可用信貸額度約為 8,330 萬美元。本季末，我們的淨槓桿率為0.5倍。我們適度的槓桿率，加上我們擴大後的信貸額度，使我們擁有了相當大的財務靈活性來執行我們的策略性舉措。

Before we move into our Q&A session, I'd like to provide our current thoughts around the outlook for the remainder of fiscal 2026. As previously disclosed, we continue to expect organic revenue to be essentially flat year over year given the pull forward of revenue related to the F-16 production and service revenue from fiscal '26 into fiscal 2025 that we discussed last quarter. When we think about our cadence of the balance of the rest of the year, we expect second quarter revenues to be in the range of $20 million to $22 million, building steadily on a sequential basis as we move through the year.

在進入問答環節之前，我想先談談我們對 2026 財年剩餘時間的展望。正如先前披露的那樣，鑑於我們上個季度討論過的與 2026 財年 F-16 生產和服務收入相關的收入提前至 2025 財年，我們仍然預計有機收入將與上年基本持平。當我們考慮今年剩餘時間的節奏時，我們預計第二季營收將在 2,000 萬美元至 2,200 萬美元之間，並隨著時間的推移穩步增長。

That completes our prepared remarks. Operator, we are now ready for the question-and-answer portion of our call.

我們的發言稿到此結束。接線員，我們現在準備進入問答環節。

(Operator Instructions) Bobby Brooks, Northland Capital Markets.

（操作員說明）Bobby Brooks，北地資本市場。

Good morning, team. Thank you for taking my questions. First, the organic growth you guys posted in the first quarter, very impressive. And I wanted to dive a little bit deeper on to that. Could you just discuss what products or kind of specific aircraft retrofits drove the increase in Commercial Aftermarket demand and sales?

早安，各位同事。謝謝您回答我的問題。首先，你們第一季的自然成長非常令人印象深刻。我想就此進行更深入的探討。能否具體談談哪些產品或特定類型的飛機改裝推動了商用售後市場需求和銷售量的成長？

Sure. So in terms of the -- this was all mainly towards the air transport side of things. So we've had some sales of our -- the products that we had developed that were certified roughly last year that are beginning to take some grounds here like the EICAS system for the 757/67. We've developed LPV for the 757/67 as well as some software upgrades on to update the magnetic variations. So it was a combination of increased sales on the air transport from new products that we've developed over the last couple of years.

當然。所以就這方面而言——這主要都與航空運輸有關。所以，我們去年開發並獲得認證的一些產品已經開始在這裡取得一些進展，例如 757/67 的 EICAS 系統。我們已經為 757/67 開發了 LPV，以及一些軟體升級來更新磁場變化。因此，這是過去幾年我們開發的新產品帶動航空運輸銷售成長的綜合結果。

Got it. And then kind of following up on that. So it seems like these were -- a lot of it was new demand generation, right? And I guess what I'm trying to get at is, was there any pull forward in demand? Because I know, Jeff, you kind of ended the remarks with saying organic revenue expected to kind of be flat for the full year ['26]. Obviously, you just posted a great quarter of growth. So just trying to reconcile maybe what happened in the first quarter and then what's going to play out for the rest of the year?

知道了。然後就此展開了討論。所以看起來這些大多是新的需求產生，對吧？我想問的是，是否有提前需求？因為我知道，傑夫，你最後總結說，預計全年有機收入將基本持平。['26]。顯然，你們剛剛公佈了一個非常出色的季度成長業績。所以，我只是想弄清楚第一季發生的事情，以及今年剩餘時間會發生什麼？

So -- again, the -- when we -- last year, we had a significant growth in our revenue, which backs into the basis for the organic growth of this year. The first quarter was very strong on the organic growth. But when we look at our business model for 2026, we still believe that our organic growth is going to be somewhere on a single digit and will be augmented by some acquisitions that we're contemplating.

所以——再說一次——去年，我們的收入實現了顯著增長，這為今年的有機成長奠定了基礎。第一季有機成長非常強勁。但展望 2026 年的商業模式，我們仍然相信我們的有機成長率將保持在個位數，並且會透過我們正在考慮的一些收購來增強。

Got it. And then you mentioned how you expect -- in the press release, expected revenue related to F-16 platforms to kind of scale through the year. Is that as simple as that your backlog indicates that or is there something else driving? You also mentioned in the press release growth opportunities related to the F-16 platform. And I was just curious to hear kind of what those growth opportunities look like.

知道了。然後你在新聞稿中提到，你預計與 F-16 平台相關的預期收入將在一年內逐步成長。僅僅是積壓的工作量表明了這一點嗎？還是另有其他原因？您在新聞稿中也提到了與 F-16 平台相關的成長機會。我只是好奇想了解這些發展機會具體是什麼樣的。

So for your first question, the -- on the F-16 platform, we completed the digital flight control computer integration into our system around the end of last -- end of 2025 -- financial year 2025. So Q1 was a full load of digital flight control computers that we delivered to Lockheed. The integrated display generator, the iPDG is -- we are -- it's being integrated into our system here now. And so we will see growth in revenue coming from that as it gets integrated and we start delivering from here.

所以對於你的第一個問題，關於 F-16 平台，我們在 2025 財年末完成了數位飛行控制電腦與我們系統的整合。所以 Q1 是我們交付給洛克希德的一整批數位飛行控制計算機。整合顯示產生器 iPDG —— 我們正在—— 它現在正在被整合到我們的系統中。因此，隨著系統的整合和我們開始交付，我們將看到收入的成長。

The opportunities for growth on the F-16, there is -- I mean, if you listen to Lockheed, they say they're going to build another 300 of these. And also, what we're seeing is that we're seeing a lot of RFP coming in from Lockheed as well as the US government for subassemblies as well as full units, which indicates that there will be future growth from the F-16 platform for us.

F-16 的發展機會是存在的——我的意思是，如果你聽洛克希德公司的說法，他們說他們將再生產 300 架。此外，我們還看到洛克希德公司和美國政府發出了大量關於子組件和完整單元的招標邀請書，這表明F-16平台未來將為我們帶來成長。

Understood. Congrats on a great quarter.

明白了。恭喜你本季表現出色。

Greg Palm, Craig-Hallum Capital Group.

格雷格·帕爾姆，克雷格-哈勒姆資本集團。

This is Danny Eggerichs on for Greg today. Maybe just hitting on the quarter, having provided guidance with just a couple of weeks left in the quarter and then kind of seeing upside that we saw there. Any way to dig in further on maybe what you saw in the last few weeks and maybe what surprised you to the upside there?

今天由丹尼·埃格里奇斯代替格雷格為大家帶來報導。或許只是季度末業績預測出了問題，因為在季度末只剩下幾週時間的時候我們給出了業績指引，然後看到了我們所看到的上漲空間。有沒有辦法更深入地探討一下你在過去幾週的所見所聞，以及其中有哪些讓你感到驚喜的正面方面？

You mean in terms of what we said last time and what we hit?

你是說就我們上次說的和我們實際做到的而言嗎？

Yeah, exactly.

對，沒錯。

Timing of shipments. Sometimes it was just timing of a couple of shipments came in. The POs came in sooner than we expected from some of the customers as they were clearing at year end, their year end.

發貨時間。有時候只是因為幾批貨物到貨的時間剛好適合。由於部分客戶正值年末清倉，所以採購訂單比我們預期的早到。

Okay. Got it. That makes sense. And then maybe if we can hit on some defense outside of that F-16 progress on some other programs out there or leads or what gets you excited for 2026 on the defense side?

好的。知道了。這很有道理。然後，如果我們能在F-16以外的其他國防項目上取得一些進展，或者在其他項目上取得一些領先優勢，或者在國防方面有什麼讓你對2026年感到興奮的，那會怎麼樣呢？

So there's a fair amount of opportunities that are coming out right now. There's a lot of RFPs that are coming up for upgrade of various platforms. I -- for competitive reasons, I don't want to go too much into details of it. But needless to say that our aircrafts within our DoD, some of them are getting longer in the tooth, and they need upgrades done to them. And it seems like that the budget is being approved to provide those upgrades.

所以現在有很多機會湧現。即將發布許多關於各種平台升級的招標書。出於競爭原因，我不想過多贅述細節。但毋庸置疑，我們國防部的一些飛機已經老舊不堪，需要進行升級改造。看來用於進行這些升級的預算已經獲得批准。

So we see a lot of opportunities there. On some of the platforms, we actually -- we are on a bid with multiple prime integrators, which kind of indicates whoever wins, we will have some content.

所以我們看到了很多機會。在某些平台上，我們實際上——我們正在與多家主要整合商競標，這在某種程度上表明，無論誰中標，我們都會有一些內容。

Okay. That's very helpful. Maybe I'll just hit one on M&A. Now with kind of the CapEx cycle winding down and a nice quarter of free cash flow here as well. And I think last quarter, it sounded like the pipeline was robust and maybe there was a couple of opportunities that were pretty close. So any change in thinking there? Is there any acceleration in kind of the pipeline and maybe expecting something here in the near term?

好的。那很有幫助。或許我能在併購領域大賺一筆。現在資本支出週期基本上已經結束，而且本季自由現金流也相當不錯。我認為上個季度，專案儲備似乎很充足，可能還有幾個機會即將達成。所以你們的想法有改變嗎？這條產品線是否有任何加速推進的跡象，我們是否可以期待在短期內看到一些成果？

We are expecting a couple of things in the near term, yes. There were opportunities in the previous quarter and the one before that as well. I think from a strategic standpoint, they were not completely aligned with our strategic objectives. And then when the price went up a little bit, we kind of walked away from it.

是的，我們預期近期會有兩件事發生。上個季度和上季也都有機會。我認為從策略角度來看，他們與我們的策略目標並不完全一致。後來價格稍微漲了一些，我們就放棄了。

All right. Understood. I'll leave it there. Thanks.

好的。明白了。我就說到這兒吧。謝謝。

Josh Sullivan, JonesTrading.

Josh Sullivan，JonesTrading。

Just on the integration of the F-16 components at Exton, you guys completed the expansion there. Can you just give us some color on how that integration has come along, particularly as you're looking at other platforms or products to bring in-house, maybe where were you ahead of schedule just on that expansion and now bringing in products. Just curious how that whole process is coming along.

就埃克斯頓的 F-16 組件整合而言，你們已經完成了那裡的擴建工作。能否詳細介紹一下整合進度，特別是您正在考慮將其他平台或產品引入公司內部，您是否在擴張方面提前完成了計劃，現在正在引入產品？只是好奇整個過程進展如何。

So the F-16 actually took longer than it was planned for. Again, we're kind of at the tail end of these things. A lot of it, especially on the F-16, because you had Lockheed Martin involved and the US government involved, they wanted certain assurances to have enough safety stock before they would allow Honeywell to ship the test equipment to us. And that took longer than it was originally anticipated by Honeywell and us.

所以F-16的研發時間其實比計畫的還要長。再說一遍，我們現在差不多已經到了這些事情的尾聲了。許多問題，尤其是在 F-16 上，因為洛克希德馬丁公司和美國政府都參與其中，他們希望得到一定的保證，確保有足夠的安全庫存，才會允許霍尼韋爾公司向我們運送測試設備。這比霍尼韋爾和我們最初預期的要花費更長的時間。

But in general, having been through a number of these things, they get planned for five to six months, and it typically takes roughly more like nine months. And that's not from our side, it really is from the side of the larger organizations that we acquire these products from, and it takes them longer to close out their books and ship equipment to us.

但總的來說，在經歷過許多這類事情之後，它們的計劃時間通常是五到六個月，而實際完成時間通常大約需要九個月。這並非我們這邊的問題，而是我們從中採購這些產品的大型機構的問題，他們需要更長的時間來結帳並將設備運送給我們。

Just maybe switching gears, you talked a bit about autonomous flight there in the remarks. What are you seeing from market interest on UMS? And where do you want to take the line on automation? And then on the regulatory environment, as we start to think about things like drones, where are you guys thinking in terms of that market?

換個話題，你在剛才的發言中稍微談到了自主飛行。您認為市場對UMS的興趣如何？那麼，您希望在自動化方面走多遠？那麼，在監管環境方面，當我們開始考慮無人機之類的東西時，你們在這個市場方面有什麼想法？

Look, it's -- the regulatory environment has kind of been -- had its ups and downs. I mean, NASA came out a couple of years ago, they said by 2027, they are going to allow [Part 25] airplanes fly with one pilot. And then there was a pushback from the pilot organizations and pilot unions, which companies like Boeing and Airbus kind of backed away from that date. But it's something that is going to happen. The timing of it is -- it really is not that far out, but it's got to happen.

你看，監管環境一直有起有落。我的意思是，NASA幾年前就宣布，到2027年，他們將允許[第25部分]飛機由一名飛行員駕駛。然後，飛行員組織和飛行員工會進行了反對，波音和空中巴士等公司也因此在那個日期上有所退縮。但這終究會發生。時間點其實並不遙遠，但這件事必須發生。

What we're seeing is a lot of interest in cockpit automation. Eventually, once the regulations change, that would result in one pilot flying the airplane. From operators and the airlines, they would love that because it saves them roughly about $1 million on an airplane per year.

我們看到人們對駕駛艙自動化非常感興趣。最終，一旦法規改變，就只能由一名飛行員駕駛飛機了。對於營運商和航空公司來說，他們非常樂意看到這種情況，因為這每年可以為每架飛機節省約 100 萬美元。

But again, regulations have to change. The pilot unions have to come on board. And -- but meanwhile, we're seeing a lot of interest in levels of automation that leads to that.

但是，規章制度必須改變。飛行員工會必須參與其中。但同時，我們看到人們對實現這一目標的自動化程度非常感興趣。

Great. Thank you for the time.

偉大的。感謝您抽出時間。

This concludes our question-and-answer session. I would like to turn the conference back over to Shahram Askarpour for any closing remarks.

我們的問答環節到此結束。我謹將會議交還給沙赫拉姆·阿斯卡普爾，請他作總結發言。

Thank you, operator, and thank you, everybody, for supporting us and attending our call. I look forward to share some more information with you in near term.

謝謝接線員，也謝謝大家的支持和接聽我們的電話。我期待在不久的將來與您分享更多。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議已經結束。感謝各位參加今天的報告會。您現在可以斷開連線了。