I'm Dan Moll, Managing Director here in the investment bank, and I'm joined today by the management team of Exponent, which is great to have Dr. Catherine Corrigan, CEO. We have Dr. John Pye, the President. We have Rich Schlenker, the Executive Vice President right next to me, and then Eric Anderson, the Chief Financial Officer joining us today. We're going to step through a couple of things and we'll take some time. We'll go through the format. At the end, would love to open up. Maybe we'll leave 5- 10 minutes for some Q&A at the end. Going to have a lot of good discussion today. As we go through this, just one thing to kick off a little bit as we think about it, John and Eric, you're both long-tenured people, insiders rather than outside hires. The continuity signal and the strategy, just talk to a little bit about that and how it's been differentiating and how you think about your promotion path. All right. Well, I'll kick us off here. I started at Exponent in 1999, fresh out of Stanford. Never thought I'd be sitting in this seat, you sort of do what's right in front of you with bigger opportunities each year. That's how we grow in the firm. To me, it's very natural. I've held a lot of positions operationally around the company. I think that is really our power is we're a seller/doer organization at all levels. You get it from somebody that's sitting in Catherine's seat or my seat. You get it at an entry level that somebody is coming in as a PhD with MIT or Stanford or something like that's a fantastic journey for us. That continuity, that perspective, lets us deliver value in really any engagement we have, whether it's a room like this of investors or you're sitting in front of the clients. You get Exponent's best when you're sitting there. To me, it's very natural. I'm very thankful to be sitting here. It really goes to the strength of our organization as well that we all play like that. I haven't been here quite as long as John, but I started in 2003. Learned pretty quick that Exponent's a really incredible place to work. I've seen us go through management transition in the past, and it's very deliberate and well thought out and planned. I've worked with Rich for a number of years, really believe in this company, and I'm looking forward to this new role. Yeah, I think it goes to how we really define ourselves as a company. Dan, you mentioned differentiation. For those that may not know our story very well, we are a premium engineering and scientific consultancy that helps clients across many different sectors solve some of their toughest challenges. This started as a group of failure analysis PhD engineers from Stanford, some faculty and researchers back in 1967, we have grown over time to cross all the classic engineering disciplines into the sciences in terms of health sciences and environmental sciences as well. Helping clients with failure analysis issues, with products that have been out in the wild for a long time, or if you're a utility, for example, also leveraging that failure analysis knowledge to help clients in a forward-looking sort of way as they are thinking about their regulatory issues, as they're thinking about product development. Wherever they have those places where they get stuck and getting it right really, really matters. This is why we hire the kinds of people like John, he's a PhD from Stanford. I'm a PhD from MIT. Over 70% of our consultants have doctoral-level qualifications in their fields, it is an integrated ecosystem where we can deliver a multidisciplinary team to that client to complement their internal team. I think John's journey in Exponent is very multidisciplinary in nature, as is mine, it really speaks to the DNA of the company. Thank you, Catherine. You went right where I was going, which is great, talking a little bit about the failure analysis. While we're on that topic, there might be some folks that are less familiar with the story in the audience. Let's spend a little time talking about some of those core services, the segments, the industries, the customers, and the type of solutions that you provide, if we can go there. Yeah. Look, some of our biggest sectors that we work in, consumer products, which includes consumer electronics. You can look at transportation. A big part of that is automotive, but also other emerging areas of transportation. The chemicals industry, this is a place where we do a lot of work for a pesticide manufacturer, biocides, industrial chemicals, obviously a heavily regulated safety critical kind of industry. The energy sector, this is one where, in particular right now with the power demands associated with increasingly complex technology, this is a place both in power generation where we play, as well as on the distribution side in utilities, doing things like looking at risk, understanding the root causes of wildfires, looking at asset integrity. The construction industry. This is another place, advanced materials, dispute related work. About 50% of the work that we do is related to a dispute in some way or another. 60% of the business is what we call reactive, something has happened, whether there is a bridge collapse. We've done high profile failure analysis, whether you go all the way back to things like the BP oil spill or Toyota unintended acceleration, or Samsung Galaxy Note7 phone issues. The Cruise accident, the automated vehicle accident that occurred in San Francisco now 18 months or so ago. That really forms 60% of the business, but the other 40% really is that forward-looking kind of work where the client is trying to avoid that product recall. They're trying to avoid that liability. They are trying to avoid the risk of their infrastructure starting a wildfire. It's a highly differentiated and really unique kind of portfolio. Great. Thank you. Let's take a little bit of a step back through history and then fast-forward. You were on the panel a year ago. If we were to rewind 12 months and then go forward to now, the business looked quite different. There's a little bit of a different setup. Utilization in the low 70s. Consumer electronics, which you spoke of, were still soft. Growth was a little more reactive led today, double-digit total revenue growth, consumer electronics back as a key driver. Walk us through what has changed over the last year, last time you spoke with us on the panel, and what's simply cyclical recovery, how much of the improvement is durable rather than maybe a snapback? Yeah, I can start and others can jump in. Look, it is classic Exponent that we are constantly evolving the set of capabilities that we are bringing to the market because the needs of our clients in the market are always evolving. If you think about where technology has been, even in the last 12 months, the speed of innovation around products. Think about companies that are trying to deliver artificial intelligence through hardware. Okay? This is going to be in consumer electronic-type devices, all kinds of novel form factors. Right? It's not just your phone or your tablet anymore, it's your wearable device that's going to not just count your steps, but it's going to tell you if you are having a heart attack and you need to go to the emergency room. Right? That's getting toward a regulated medical device. You are trying to accomplish things with maybe a pair of glasses to deliver AI, where the human-machine interface is novel and incredibly challenging, and it's an area where you need, because of the competitive landscape, or the safety critical nature of it, you need to be right. Right? These drivers around innovation among our clients are a big part of why our growth has accelerated over the last several quarters. Whether it's the data coming in, whether it's the algorithm, whether it's the infrastructure investment around AI, these have all been drivers over the last year. Yeah, I think the other thing that really is continuing to accelerate is really the spend on infrastructure, and the stress on the supply chain for that infrastructure that's come through. When we look at how we're still early in it on what we're getting requests for to look at relative to data centers, but I would say over the last year, we've seen a request come in almost at every component level in the rack. Everything from challenges around wiring and the stress on that to what's happening in the router technology and the stresses on that, to the switches, all the way onto the board. These advanced cooling systems that are coming in that are creating corrosive issues. We're having challenges around the HVAC systems that are in there. Some of those are already getting to the level of disputes, all these things are beginning to come to the area of the systems are being stressed, and we are beginning to get called in and say, "Help us figure out what's going on." Okay, that's great. How do we correct it going forward? A few are even moving towards that dispute issue. People are moving so fast, that's really what's driving it as well. That's great. With these secular drivers that we speak of, you spoke to some of them now in the past, in other forms, energy demand, infrastructure risk, technological innovation. One question that comes up is how does it materially appear in your pipeline? How long do you think that this story goes on for? How much visibility are we able to really have in some of these markets? I think they're the same kind of drivers we've always had. There's complexity. There's a world that's not getting any younger, it's getting older, you've got aging infrastructure. You've got expectations around the reliability of what you're trying to deliver. Those things have been true. They're still true. They're always going to be true. When you think about the durability of the pipeline, these are core offerings that you're investing in at a higher level that are driving us to the next step. There are new offerings built on those core offerings that let us diversify and get into new markets, new verticals. Some of those are existing, people that are very sophisticated in their understanding of risk and understand what it takes to drive something new into their product chain. Some of them are completely new entrants. Catherine's example about the consumer electronics industry, you take the wearable world, where we've done a lot of work helping them get their screens right, their batteries right, compatibility of the materials with your skin, et cetera. That's on a device that's counting your steps. It's on a device that's largely in a comparatively unregulated environment, and they're trying to move those devices into the health area, into delivering a medical outcome. Well, that brings in a whole new level of reliability, brings in a different regulatory framework, which is fantastic because we play in that framework for the medical device companies, and now you can bring that knowledge into the consumer device world and bring those two pieces together. As the complexity goes up, the opportunity to have that multidisciplinary sale, which is one of our strengths, goes up as well. I think the fundamentals are there. They're not changing. The business is in an excellent spot to be able to take advantage of that increased complexity. The diversification that comes as you add new entrants in at whatever stage they are in their sophistication of understanding risk, that's just new opportunity for us as well. Got any markets that you watch that could be the canary in the coal mine of any softer macro policy or anything that is a precursor to a change in supply-demand dynamics? Look, as we've looked at the history of the company, we think about macroeconomic ebb and flow, it's really a story that is quite resilient. If you think about the 60% of the business that's around disputes and failure analysis, doesn't really matter if it's a recession, that issue that led to whatever that failure was, that is still there, right? Our clients, because of the nature of disputes, they are in a situation where they have to hire an independent third party. They don't have the ability to just use people in-house. You have that market for experts over time, and we've seen that even with ebbs and flows, recession, not recession, what have you. The proactive side of our work, when you think about regulatory frameworks, that's a big part of our chemicals work, some of the medical device. The regulators don't stop paying attention just because of a recession, our clients, it's about a new product that they are innovating. We helped a chemical company that had the first messenger RNA technology in a pesticide. That's a level of complexity that isn't about how many units of your chemical did you sell. It's about are you going to have a product in the market, right? They may tighten their belts in a macroeconomic timeframe where they're pulling back, there is a little more visibility on budgets and things like that. We've shown our ability to continue to grow that work over time. The risk work, utilities are being pushed on by the public utilities commissions to do more sophisticated, more quantitative risk models that are incorporating larger and larger sets of data. We've seen resilience in that business as well. The product development kind of proactive work is driven by speed of innovation. Look, there is, of course, some ebb and flow in the business, we've been relatively resilient if you just look at our history over time and our ability to grow even through those kinds of cycles. I love that answer, Catherine. I was thinking about it as you were talking, and I think the one thing to consider is that we touch that whole product life cycle, and you mentioned t hat as well. When development dollars are high, our work comes from helping get that product to market quickly. When development dollars are tight, and you're trying to be right and make sure the product that you've got out there is not causing exposure to you, well, we get the reactive dollars that are looking at that. There's a bear play and a bull play. There's not really one or the other. Where the work comes from shifts, but in terms of work that the company takes on, pretty resilient to those macroeconomic swings. Got it. Getting the people to help you do this work, you target some of the top PhD classes out there to get people to join the team. Growing your technical headcount. There's a lot of competition with all the other AI labs and hyperscalers and other resources out there that need the talent. How do you guys get it? We, 1,000 professionals, we're trying to hire 200 new hires each year. Our company's got a reputation that is pretty top-notch. The people going to the hyperscalers, they might not be the human factors people, but eventually they're going to need that human factors person in one of their projects. When hyperscalers are hot, we hire human factors people. When user interfaces are the name of the game, we hire corrosion experts or battery experts to get that piece. There's a strength in our multidisciplinary offering that lets us move where we're hiring from as the demand changes up and down. This was my employer of choice. You have options. I graduated in the dot-com boom, and there were lots of things going on there. There are always folks that want to be diverse in what they do. They don't want to sit in the cubicle working on that same connector. For me, it was the little red knob on your beverage cart that you see on the airplane. I went up to Boeing, and that was the example they showed me. I could work on that my whole life, or I could work on everybody's hard problem. That's what I chose, and there are always choices like that. Those 200 hires we get, I think the pipeline is extremely robust, and then you think about what we're trying to do internationally. Our footprint, we do have exposure in Europe and in Asia. That could grow as well, and that brings in a whole another dimension of where we might be able to hire talent from. We have a development model at Exponent. One of our value propositions for new candidates or new hires is to apply the science and the engineering that they learn in school to real-world, high-exposure problems and to develop. The vast majority and nearly all of our hires, our intention is to promote them up to principal and develop them along the way. Working for a company that works on high-exposure, really interesting things. We have very high standards as far as technical excellence with those individuals, but that's really our value proposition and how we're able to bring in new talent to grow. I think that is so important. These are folks who, John and I were among them, you've spent after your undergrad, five, six, seven years on one really deep problem, really specific. We're tapping into the desire of those people to take that ability to solve an unstructured problem that's never been solved before, that's what a PhD does, but apply it in a real-world kind of scenario. I couldn't wait to do that when I finished my PhD. Really tapping into that and the ecosystem that we have is it's nowhere else. We rival a university in terms of any major university for 700 PhDs. Any one of these people has the ability to become a tenured professor at those top schools. They get to work on things in collaboration with others that matter for a business now and are making an impact now, and that is just a huge part of that value. Great. Let's shift a little bit to financials, capital allocation, then maybe some thoughts on M&A. For the year, as we think about it, how do you see visibility into the second half of the year? What are one or two things that you're keeping an eye on that can move you within that range? We've guided to high single-digit revenue growth for the second quarter and the full year. This is our long-term, we call it our growth algorithm of high single to low double-digit growth through hiring, through price increases, and through utilization. Slowly improving utilization to the mid-70s. We think there's a lot of opportunities this year. We talked about some of them, data centers, AI, energy infrastructure, regulatory consulting. There's just a number of growth areas that we're really looking to leverage and tap into from a growth standpoint and continue to drive that growth into the low double digits. Got it. You repurchased $79 million of stock in Q1, around $6.80 a share. You added $50 million to the authorization, showing strong conviction. How do you think about, with the capital allocation policy, as you start to see things out there, and then we can maybe talk a little bit about inorganic growth and M&A. Yep. Dividends and share repurchases have been our primary methods of returning money to shareholders. We've had a dividend since 2013. We've increased it every year since. Like Dan said, we've been pretty active in the repurchases lately with some pullbacks in the stock price. Our board approved an additional $50 million. We plan to continue that from a capital structure. We do evaluate. Since 2002, we did an acquisition, but we do evaluate acquisitions. We would like something that would seed growth in an area where we really feel like there's an opportunity to grow. We evaluate those, but really our core capital allocation strategy hasn't changed. Got it. As we think about the M&A plan, the history of the business has primarily been through a lot of organic growth profiles, homegrown talent, as we all have here up on the panel. As you look out there, technical disciplines and things that are happening in capabilities or geographies- How do we think about capitalizing on potentially accelerating the growth through M&A? How do you analyze those decisions? Yeah, I think there are some particular areas. Eric mentioned the philosophy that we've got, which is not about just buying more of what we already have. It's much more around being able to accelerate growth in something new but maybe tangential that fits really well and that we can integrate into the business, right? We don't want to be a rolled-up, you've got this business here and this business here and this business here. That integrated ecosystem is absolutely critical. Where are places where we think we could accelerate growth with some kind of tuck-in acquisition? In pharma. That's one example right now. It's 1%. It's a low single-digit percentage of the business. We are starting to be engaged by that industry around some of the wearable technology applications. If you think about being a pharma or a medical device company that wants to demonstrate the value of its medicines in the wild, you want to do that using the best technology, a continuous data stream, instead of just a blood pressure measurement every six months when you go to the doctor, that's something that sounds really good. Those companies are starting to come to us to benchmark the technologies, to help them evaluate the technologies, to help them build the strategy around how they are going to gather the data. What are the different platforms that they could consider using? What are the pros and the cons? How do I get that through the 510 process with the FDA? We are building that organically. That's the kind of thing that we could build on faster. Now, we are looking for something that fits, though, that we can integrate, premium services and so forth, the kinds of talent. Another place where we believe we have significant growth potential on the geographic side is in Europe and in the U.K. We have a very well-established chemical regulatory team up in Harrogate, with offices in Basel and in Germany and a few other places. The engineering side of the business in the U.K. and Europe is relatively small. John, that's something that you've really been working on the strategy for, if you want to give some color on that geographic growth piece. Yeah, I think there's opportunities all around the world. We are selective on where we do that and from a business standpoint and access to talent. Increasingly, we see projects that are international in scope. Maybe it's a U.S.-headquartered company, but they have a product that is built and the supply chain is increasingly complex, international in how it all comes together. Our ability to deliver all the way across that is a powerful sales thing to some of our key clients. We follow the same model. We like to put our offices where the clients are, where we have access to talent, so that we can get that organic long-term growth path. Catherine's right. If you can seed that with the right kind of an acquisition, you can shave some years off the front end of that process. We've been investing heavily in London recently as we build that out. London's a crossover place where you not only have capital, you've got disputes from an international stage that figure heavily there, but then you also have headquarters of a number of our larger clients or subsidiaries that they have in that space as well. The right geographic strategy can absolutely continue to build on our growth as you become international and deliver more value to our existing clients, as well as maybe open up some new markets for us. Great. That's exciting. Certainly a lot of opportunities as you think out there. Maybe let's take an opportunity to give the room a little bit of a tangible sense, if you can. If there's anything that you could speak about, given the failure analysis and the importance of understanding kind of the proactive, reactive dynamics to the business model is huge. Any high-profile accidents, failures, or anything that you're working on that could be in the news that you can speak to publicly? Just to get a little bit of sense of the reactive work or any dynamics like that that you'd be willing to share. Well, look, the vast majority of the time, our clients don't have us talking publicly about things. One more recent example on the reactive side is going to be the, I mentioned it just briefly, the Cruise automated vehicle incident in San Francisco last year or the year before. It's publicly known that we were called in to do the root cause analysis investigation of that. This was an incident where a human driver actually struck a pedestrian. The pedestrian was launched into the path of the Cruise vehicle. The Cruise vehicle then struck the pedestrian. The real problem was that the vehicle then continued to drive after that, and then unfortunately dragged the pedestrian, and there were some very severe injuries. Look, this kind of incident is emblematic about the value proposition of Exponent, okay? Especially around AI. I think this is a really important part of why we're out on the road talking with investors. Because AI is being used in safety-critical, performance-critical systems. It's only just starting to be used in those kinds of applications, right? Yeah, large language models and so forth, those are used, and maybe they get it 80% right, 85% right, even 90% right. For that example of that crash, the pedestrian under the car wasn't in the training data set. It just wasn't there. That's that reliability where 99.9% is not good enough. That would be one out of every 1,000 turns or stops, the car is making a mistake. You've got to get that out far further on the number of nines that you have in that system, right? This is the place where Exponent plays, where we do not only the failure analysis work on that, but you can also imagine how an incident like that wakes up the entire industry to what the challenges really are and unlocks the kind of proactive work that we can do because we understand the modes of failure that these products can have. We've been doing work in vehicle crashes since the dawn of our company in 1967, right? We have been doing failure analysis of transmission lines since day one of our company. We have the structural engineers who literally wrote the book on structure-related risk and how to model that. You're doing that in an environment where even more demand is being placed on that system, right? This is classic Exponent, where the reactive incident then drives a bolus of proactive work and offerings over time. We have repeated that cycle over and over and over again, and we know how to take advantage of that. I went a little further than your question. I thought it was a great opportunity, especially with Look, there are concerns around is AI a tailwind, is AI a headwind, right? We are 100% on the tailwind side of that. Because of the kind of dynamic that I just mentioned. You've got to get the right answer in these safety-critical systems. That requires more than an algorithm that just predicts the next word. Well, I think, just to layer on that is, Exponent is called upon to investigate many of these large wildfires that have occurred in our urban settings and such, and throughout the West Coast. That is an event that drives back into that industry. How do we just keep getting better at predicting where these could occur? How do we analyze every component in our system so that we understand where our failures could occur, how to improve those assets? That's where to spend money. It's also you're able to evaluate, once you've even made that investment, where the risks are and when a power shutoff should occur. That's where you build in into these models. You start off with failures, you learn from those, and then you build into the system and create more reliability in the system. I love it. I love the passion that you all have around solving problems. This kind of goes into, Catherine, what you've talked about before is the AI and the technology coming into the physical world. You're seeing that root impact to all of us. That's hugely important, so thank you. We have a little over four minutes left on our timer. I'd like to open up for any questions from the audience at this point. I could keep going, but this is your chance if you want to throw some out there. Anyone? Feel free, jump in. Nothing right now? All right, I could keep going. You got a question. No. No, I'm just kidding. All right. One of the things that we want to talk a little bit about is the growth in margin algorithm. It's one thing that it kind of talks about so people understand a little bit. We talked about a lot of the drivers. If someone could talk a little about that growth margin algorithm and how it plays in with the people, that'd be a helpful way to kind of start bringing us to an end here. Yeah, I can take that one. Our growth algorithm, I alluded to it earlier, is high single, low double-digit growth, and we play at the premium end of the market. We do the toughest projects, the most difficult thing, high-exposure things for our clients. With that comes some pricing power. The caliber of people that we bring to the problems and the types of things that we work on allow us to increase our prices. In the last year, we raised bill rates on an absolute basis about 7%. The realized bill rate increase is about half of that because we lose people in the middle. There's healthy turnover in any consulting organization. Not everyone makes it to principal, like I talked about, so there's some turnover along the way, and then the new people that we bring up. Those dynamic blends it down a little bit, to that 3.5%. We've got the pricing; we've got the recruiting. We guided this year at a 4% increase in technical full-time equivalent employees. Long term, we think we can grow that even higher, 4%-8%. That on top of pricing, and then on utilization, another driver for revenue growth. We think we can get that to the mid-70s in the next couple of years. Our guidance this year was 72.5%-73%. We can get a little bit more out of utilization. Again, there's only so much you can get out of utilization because our people need to write papers and do research and recruit and do business development and all the things that really drive this growth. That's what drives the top-line growth. Then from a margin standpoint, as we leverage our infrastructure, our facilities, our corporate structure, our incremental increases to utilization, we also believe that we can increase margins over time as well. Our margin guidance for 2026 is 27.6%-28.1%. Slight increase versus the 27.6% that we realized in 2025. That algorithm continues into the future. We think it's sustainable, and we can continue to grow revenue in the high single or double digit, be conscious with our expenses, but make investments where it makes sense and leverage our infrastructure and continue to improve margins over time. Thanks, Eric. As we kind of look out a little bit over the next few years or maybe even next year when we're back at the Wells Fargo conference, what's the single most important thing you want the room to understand and walk away believing about Exponent and your company? Yeah. That's about the premium differentiated position that we have in the marketplace and the strength of the things that drive our market. Right? If you believe that innovation and technological change and complexity are accelerating, and if you believe that society's expectations around safety, around health-related issues, around environmental-related issues, are going to continue to increase, then this is a place that is the fundamental thing that is going to drive our markets, and that is really the investment thesis for Exponent over time. We've had our growth accelerate over the last three quarters. We've been around that 10% or so range. I've been with the company 30 years. I think our market drivers are stronger than they've ever been. The pace of change, the investments in the infrastructure, we are in a position to capitalize on that. It's at a time when, frankly, we've been lumped in with a broader set of management consultancies that look nothing like us. Big IT implementations. We've got a stack. We don't have a big layer at the bottom of paralegals and bachelor's level people. We look like a stack. Our bottom is PhDs from Stanford, MIT, Caltech, Berkeley, Michigan, you name it. Right? These are the people who know how to leverage this technology and how to build those kinds of models that are going to get you to the.9999 that you need. It's very exciting. Sounds like mission-critical services to me. On behalf of Wells Fargo, Catherine, John, Rich, Eric, thank you for joining us. Thank you. Enjoy the rest of your day, everyone. Thanks again. Thanks, everyone. All right. Thank you.