Good day. Thank you for standing by. Welcome to the ICON plc Q2 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there'll be a question-and-answer session. To ask a question during the session, you will need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Kate Haven. Please go ahead. Hello. Thank you for joining us today. I'm joined on the call by our CEO, Barry Balfe, and our CFO, Nigel Clerkin. I would like to note that this call is webcast and that there are slides available to download on our website to accompany today's call. Certain statements in today's call will be forward-looking statements. These statements are based on management's current expectations and information currently available, including current economic and industry conditions. Actual results may differ materially from those stated or implied by forward-looking statements due to risks and uncertainties associated with the company's business. Listeners are cautioned that forward-looking statements are not guarantees of future performance. Forward-looking statements are only as of the date they are made. We do not undertake any obligation to update publicly any forward-looking statement, either as a result of new information, future events, or otherwise. More information about the risks and uncertainties relating to these forward-looking statements may be found in the most recently filed annual report on Form 20-F. This presentation includes selected non-GAAP financial measures, which Barry and Nigel will be referencing in their prepared remarks. For a presentation of the most directly comparable GAAP financial measures, please refer to the section of the press release dated July 29th, 2026, titled Consolidated Statements of Operations. While non-GAAP financial measures are not superior to or substitute for the comparable GAAP measures, we believe certain non-GAAP information is more useful to investors for historical comparison purposes. Included in the press release in the earnings slides, you will note a reconciliation of non-GAAP measures. Adjusted EBITDA, adjusted net income, and adjusted diluted earnings per share exclude amortization, stock-based compensation, foreign currency gains and losses, restructuring, transaction integration related and other adjustments, transaction-related financing costs, fair value movement on investments in equity, goodwill impairment, loss on disposal of subsidiary undertakings, impairment of non-financial assets, and their related taxation effect. In the interest of time, we ask participants to keep their questions to one each. I would like to now hand over the call to our CEO, Barry Balfe. Thanks, Kate. Thanks, everybody, for joining. ICON delivered solid second quarter results characterized by a positive demand environment, strong bookings, and disciplined cost management as we navigated the business mix headwinds discussed on our last call. While pass-through activity continued to benefit reported revenue and net bookings, underlying business performance delivered further sequential earnings progression during the quarter. Direct fee bookings also remained strong, resulting in a direct fee net book-to-bill ratio of 1.2 x. Overall, our second quarter results were consistent with the trends we have highlighted in recent quarters, with measured progress supported by sustained evidence of an improving demand environment. We remain focused on delivering for our customers, executing with discipline, and investing in capabilities that strengthen our competitive position. Turning to bookings performance, Q2 gross business wins were $3.7 billion, an increase of 24% year-over-year and 13% sequentially, with strong performance across the portfolio. Cancellations totaled $562 million, broadly in line with expectations, resulting in net bookings of $3.1 billion and a net book-to-bill ratio of 1.51 x. Awards were broad-based across customer groups and were supported by further improvement of win rates in large pharma, where we also saw the addition of some meaningful FSP programs to existing relationships. We also saw strong performance elsewhere. Mid-size and biotech companies representing eight of our top 10 customers by awards in the quarter. I was also encouraged by the scale and diversity of awards secured during quarter two, with our largest 13 individual business wins, each exceeding $50 million in value, sourced from 11 different customers spanning large, mid-sized, and biotech sectors. Against this backdrop, the overall customer demand environment remains generally constructive, notwithstanding expected seasonal impact over the summer months. In quarter two, RFP flow increased 22% sequentially and 16% on a trailing 12-month basis. Following two quarters of particularly strong activity, large pharma RFP flow moderated somewhat in the second quarter. We saw a marked increase in biotech during the same period. This is consistent with our strategic objective of addressing more of this important market, albeit that came with a higher proportion of ballpark proposals and a reversion to historical win rates in biotech as we engaged with certain customers for the first time. Staying with pipeline quality, average proposal values continued to increase across the full service portfolio, while phase III opportunities represented approximately 50% of total opportunity volume in the quarter compared with an average of roughly 40% a year ago, a sign that customers are increasingly bringing assets into the later phases of development. Taken together, these data provide further evidence that our focused commercial strategy is delivering results. We continue to focus on three clear priorities. Expanding opportunity flow in biotech, diversifying our sales channels within large pharma, and increasing our market share with mid-size pharmaceutical customers. While these efforts will take time to impact the P&L directly, we are seeing tangible progress across all three areas as our scale, capabilities, and differentiated innovation strategies continue to resonate with customers. Turning to financial results for the quarter, revenue increased 1.2% year-over-year and 1.4% sequentially to $2.1 billion, benefiting from higher pass-through activity. Adjusted EBITDA of $327 million, with adjusted EPS of $2.56, was in line with our expectations for modest sequential progression and reflected strong cost control across the business. Elevated pass-through contribution impacted margins during the quarter and may continue to do so in the back half of the year as therapeutic mix and site location dynamics increase the volume of pass-through dollars that we expect to burn on certain studies. Based on our year-to-date performance, we are reaffirming our full-year 2026 financial guidance, reflecting both the results delivered in the first half of the year and a balanced view of the opportunities and risks that remain in the second half. While our near-term focus remains on execution, on margin progression, and on delivery against our financial commitments, we continue to invest in strategic initiatives that support our long-term growth, differentiation, and competitive position. AI has become a foundational element of how we operate, how we deliver clinical trials, and how we create value for customers. Our investment strategy is different from others. We don't see value in going all in on chips or on enterprise licensing of generic applications. Rather, we are focused on advancing domain expertise through targeted investments in architecture and frontier models that enhance our capabilities, accelerate our trials, and help us to monetize our existing data assets. In that respect, the multi-year collaboration with Anthropic announced this week represents an important milestone for ICON. Combined with our partnership with Microsoft, this collaboration strengthens the technology architecture underpinning our clinical trial delivery platform and supports three core priorities. Enhancing the intelligence layer powering Orbis, our agentic AI platform, deploying advanced AI capabilities to improve productivity, and developing domain-specific agents embedded directly within ICON's clinical trial management workflows. For customers, these capabilities have the potential to streamline study design and planning, to accelerate protocol development and trial execution, to enhance patient and site engagement, and to reduce administrative burden throughout the clinical development process. These development projects are increasingly moving from the planning to the execution phase. One example being Meridian, our multi-agent clinical monitoring platform, which brings AI-enabled tools directly into the day-to-day workflows of our global monitoring organization. Leveraging ICON's proprietary data assets, domain expertise, and delivery experience, these purpose-built agents make us better, giving teams greater insight into trial status and enabling rapid decision-making in the field. Standing back from the detail, these initiatives reflect our core approach to AI. That is to say we're combining leading technology partnerships with ICON's domain expertise, proprietary assets, and clinical delivery capabilities to create meaningful value for customers, strengthen our competitive position over time, and recognize value accordingly. Alongside AI, we continue to invest in targeted growth opportunities across the business with an emphasis on expanded capabilities and accelerated growth. In China, for example, we've seen notable improvement in demand over the last 12 months, and we continue to expand our capabilities there, including significant laboratory expansion that adds specialty biomarker testing and pathology. This builds on the investment in Singapore highlighted last quarter and reflects our commitment to further strengthening our lab footprint across the Asia-Pacific region. These investments were rewarded during the quarter with the addition of a new partnership with a leading Chinese biotech company supporting global development programs across a broad range of full-service capabilities, including laboratories and imaging. These outcomes reinforce the value of continuing to invest in attractive growth opportunities while maintaining a disciplined approach to capital deployment. Our strong cash generation in the quarter further strengthened our financial position and supported our balanced capital allocation framework. We remain focused on investing in the business, pursuing strategic growth opportunities, and particularly returning capital to shareholders. In closing, I'm satisfied with the steady progress that we're making across the business. Strong bookings, a constructive demand environment, and disciplined execution provide a solid base as we move through and beyond some underlying challenges in the business mix and navigate the dynamic pharma sourcing trends of recent times. We remain focused on what we can control, delivering for customers, executing with discipline, and investing in the capabilities that will strengthen our competitive position and support sustainable long-term growth. These factors underpin our confidence in ICON's ability to continue taking share, deepening customer partnerships, and capturing the significant opportunities that lie in front of us. Finally, I would like to thank all of my ICON colleagues for their continued commitment, energy, and focus on delivering for customers as we partner with them to bring forward new options for the millions of patients who need them. Now, I'll hand over to Nigel to take a more detailed look at the financials. Thanks, Barry. Revenue in quarter two was $2.1 billion, representing a year-on-year increase of 1.2%, or an increase of 0.4% on a constant currency basis. Compared to the first quarter of 2026, revenue increased by 1.4%, while our adjusted EBITDA expanded by 3% to $327 million, resulting in an adjusted EBITDA margin expansion of 30 basis points to 15.9%. While these results were broadly in line with our overall expectations, we did see higher pass-through activity than anticipated, with a consequent positive impact on revenue and dampening effect on margin relative to our previous expectations. Based on year-to-date activity, there is an increased potential that pass-through activity levels may exceed our prior assumption of being approximately flat year-over-year. As we saw in Q2, this can benefit revenue while impacting reported margin percentages. Our focus remains on delivering EBITDA dollars and driving sequential improvement in both EBITDA dollars and margin in the second half, with the actual reported margin percentage ultimately dependent on pass-through mix. Overall customer concentration in our top 25 customers was aligned with quarter one 2026. Our top five customers represented 24% of revenue, our top 10 represented 40%, while our top 25 represented 65%. Adjusted gross margin for the quarter was 23.8%, compared to 29.1% in quarter two of 2025. Adjusted SG&A expense was $164.5 million in quarter two, or 8% of revenue, compared to $174.8 million in quarter two 2025, or 8.6% of revenue. Adjusted SG&A expense in the quarter did benefit from certain items, including R&D tax credits, which we do not expect to recur in the second half of the year. As I've already mentioned, adjusted EBITDA was $327.2 million for the quarter, or 15.9% of revenue. This compares to $417.8 million in quarter two 2025, or 20.5% of revenue. Adjusted net interest expense was $43.4 million for quarter two. In the comparable period last year, net interest expense was $46.6 million. The effective tax rate was 18.4% for the quarter. We continue to expect the full-year-2026 adjusted effective tax rate to be approximately 17%. Adjusted net income for the quarter was $198.4 million, equating to adjusted earnings per share of $2.56. U.S. GAAP income from operations amounted to $137.8 million, or 6.7% of quarter-two revenue. U.S. GAAP net income in quarter two was $72.6 million, or $0.94 per diluted share. From a cash perspective, quarter two had cash from operating activities of $281.3 million. Capital expenditure was $42.4 million, resulting in free cash flow in the quarter of $238.9 million. At June 30, 2026, cash totaled $928.4 million, and debt totaled $3.4 billion, leaving a net debt position of $2.5 billion. This was a decrease in net debt of $2.6 billion at March 31, 2026, and $3 billion at June 30, 2025. We ended the quarter with a leverage ratio of 1.8 x net debt to adjusted trailing 12-month EBITDA. Our balance sheet position remains strong and was further supported by solid cash generation in quarter two. We remain committed to returning capital to shareholders through share repurchases, while continuing to invest in capabilities, technology, and solutions that reinforce our market-leading position. And with that, I believe we are ready to open it up for questions. Thank you. To ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We will now go to the first question. One moment, please. Your first question today comes from the line of David Windley from Jefferies. Please go ahead. Hi. Thanks. Good morning. Good afternoon to you all. Appreciate you taking my questions. Barry, the demand environment seems to continue to improve. Appreciate the detail that you're providing there. Seems like a meaningful part of it is pass-throughs. I wanted to understand, I guess, on both sides, the kind of progression of your customer cohorts. Large pharma sounds like it advanced a little bit. Biotech maybe stepped back a tad in the quarter. On the direct fee side of that and how that's advancing. Then on the pass-through side, understand the mix is maybe running a little hotter on pass-through. Is that also helping the revenue to run higher overall? I note that you didn't raise revenue guidance; it would seem like the heavier pass-through could maybe push revenue above the range. Thanks. Thanks, David. There's a bit in there, so maybe I'll start and I'll ask Nigel to expand a little bit. To start with your question on the demand environment, the demand is pretty healthy across the business. That is sure. The reason we've given the color we've given is I think it's important. While 1.5 is an exceptional book-to-bill, it is driven by particularly high pass-throughs. That's been a trend of late, right? We've seen some high pass-throughs in the revenue line. We've seen some high pass-throughs in the bookings line. I think that's really just a function of the therapeutic mix, very honestly. That's certainly how I interpret it and somewhat to do with the geographic footprint and where our customers seek to deploy trials and where we're advising them they can get those trials done. Maybe I misunderstood, but I wouldn't have said demand stepped back in biotech in the quarter. It actually accelerated pretty markedly in the quarter. After two very strong quarters of RFP flow in pharma, that stepped back a little bit and moderated somewhat over the quarter. Nothing unusual there, but it was a notable uptick in biotech demand. When you're trying to branch out into different parts of a very large market where you haven't been before, what do you want to see? You want to see that you're generating opportunity flow. I'm happy to see that. Frankly, we probably expect a higher proportion of ballpark or water testing proposals while we do that, and we certainly saw that in quarter two. There was an uptick in the volume of ballparks. It's not to say they don't have inherent value, but the rate at which they convert is certainly different. That's as a population, true and always has been. I think the demand is pretty healthy, but it is volatile quarter-over-quarter. Like I said, you see some bouncing around on what's FSO, what's FSP, what's biotech, and what's pharma. What I'm heartened by is the quality of that pipeline. The work that we're bidding on, the rate at which we're being successful in competitive RFP bidding processes, and the solidity of the pipeline are somewhat encouraging. We know there's a lag on these things, but I'm generally encouraged broadly by the demand environment. You do see a few little aberrations in there. You'll see some ups and downs in areas like the early phase, and that can be somewhat problematic as you step around the corner on whether it's canceled or whether it's an RFP or whatever. By and large, very encouraging. Nigel, you might want to pick up the ball. Dave, yeah, to your question on pass-throughs and the impact on the revenue guide for the year. Look, obviously, we published our guidance on revenue and EPS for the year two months ago now. We've reaffirmed it this morning. Look, both of them are a range, so let's see where we land within the range ultimately. We did talk before about, if you look at that range, one of the factors anchoring it was an assumption that pass-through activity would be broadly stable, broadly flat year-over-year. We have seen that be a little bit more pronounced in Q2, as we've mentioned, and obviously you've seen the impact on our top line and bottom line. To your point, we are tracking that to see how that evolves over the rest of the year. It is possible that if pass-throughs continue to run stronger, yes, that would obviously impact where we would land within that revenue range and with a consequent impact likewise on the margin evolution as we go through the year. Just to reiterate, as I said earlier, what we are focused on is progression in EBITDA dollars as we go through the year. Again, pleased to see that in the second quarter that we tracked where we anticipated we would. Again, to your point, yes, if pass-throughs continue to run stronger, that could obviously impact us in terms of where we land within the range. The other thing to remember when you look at that range for the full year is, do recall, do remember, please, that we did divest Symphony in the middle of the second quarter. That will be a drag on revenue year-over-year in H2 that wasn't there in H1 to the same degree. Thank you. Our next question today comes from the line of Ann Hynes from Mizuho. Please go ahead. Great. Thank you so much for all the detail. I know on the last call, getting to the margin question, you thought you would land, I think, in the mid-16% range. Now, given the higher pass-through, is there a new range that you would like models to go to? Secondly, I know that a lot of the cost actions you're taking are back half- loaded. Can you remind us of the amount of that and how that's tracking? Thank you. Hey, Ann, it's Nigel. I'll take both of those. To your point, yes, we talked about that the last time out. When you look at the guidance range that we put out for the year at the midpoint of the top line and bottom line, just to take that for modeling discussions, that would get you to approximately an EBITDA margin of 16.5% for the full year. To your point, if were the case that pass-throughs ran faster through the balance of the year, and let's say we ended up at the higher end of the range, well, again, mathematically, if you're at the top end of the revenue range, but the midpoint of the EPS range, if that's where we landed, that would lower that 16.5% down to something closer to the low 16%. Obviously it would impact the exit rate potentially as we head into next year for the same reason. Again, we're focused more on the dollars than the margin percent, but just mechanically, that would be the case. Your point on the cost impacts, et cetera. Look, again, that's part of how we operate as a company, constantly adjusting our resourcing. We've obviously continued that in H1 as well. That is part of the EBITDA progression that we anticipate seeing in the second half that is built into that guidance range for the year. Thank you. Our next question comes from the line of Michael Cherny from Leerink Partners. Please go ahead. Good morning. Thanks for taking the question. If I can dive in a bit, Nigel, on your EBITDA dollars, focus. I appreciate that as well. I'm just trying to reconcile the components to make sure we have it correct. You had a step-down sequentially in gross margin, which we know about; gross margin dollars obviously were impacted as well. You delivered with SG&A performance that seemed quite impressive. As you think about, going to Ann's question as well, the sustainability of those SG&A dollars, how do you view that relative to what you've put up in this quarter against the backdrop as well of the mix dynamics that obviously, as you've noted, are somewhat out of your control? Yeah, Mike, I'll take that one again. A good question. Yes, the SG&A, you're right, was lower in Q2 due to the timing of some things that won't recur in H2, as I think I commented on earlier. To be frank, I would think our Q1 SG&A number is a better run rate to think about for the rest of the year rather than Q2. The implication of that, of course, being where do we see the margin progression as we go through the balance of the year will be more on the gross margin line as we see the benefits of that mix effect as we talked about, as well as obviously the cost actions that we have taken. Continuing still to expect EBITDA dollar progression as we go through the year, it's going to be more on the gross margin line than the SG&A line. Thank you. Our next question comes from the line of Elizabeth Anderson from Evercore. Please go ahead. Hi, guys. Thank you so much. I guess if we had to think about it, you said pass-throughs potentially running a little bit above flat year-over-year, which is your prior assumption on the full-year expectations. I guess, can you help us maybe narrow that down? Are you thinking up a couple of percent? If you could help with that a little bit. Could you also please confirm your sort of share repo plans now that you are caught up with reporting? Elizabeth, I'll take both of those. I guess the whole point about pass-throughs is we gave you a range, and we're acknowledging some volatility in the underlying landscape. For me to pick a number higher, lower, or about the same would be somewhat tricky. I'm going to say we're sticking with the range for the obvious reasons. When you see some strength on the pass-through line, it is obviously possible that we might see some pull-through on that, but I don't have an updated model for you on that one. On buybacks, no change. I think I mentioned in my prepared remarks that we were keen to get back into the market, having been out of the market for a number of quarters. That remains the plan. I look forward to updating you guys on that when we next speak, but we certainly have some plans for Q3 in the back half of the year in general. Elizabeth, maybe I might just add on to your first question. Maybe a way to think about it, if it's helpful, is you'll remember last time we talked about Q1, our margin was 15.6%, and we anticipated seeing that rise by approximately half a percent to approximately 16%. For Q2, we obviously did see it rise to approximately 16%, but we came in a little below rather than a little above. Just to kind of frame it for you in context, you're probably talking about a 20- to 30-basis- point impact on the quarter relative to previous expectations. Thank you. Your next question comes from the line of Sean Dodge from BMO Capital Markets. Please go ahead. Yeah, thanks. You're coming off three really strong quarters of bookings now. In terms of composition, Barry, you called out before a bigger proportion of phase III trials in Q1. I think you said also that you'd expected that to step up even further in Q2. I guess we kind of consider that, and then maybe any other directional cues you can give us on the therapeutic mix and FSO versus FSP, how that skews. If we take all of that, how should we be thinking about maybe burn rates from backlog heading into the back half of the year and into next year? Yeah. There's a bit in there, Sean. Let me start. Look, there are more phase II trials out there than anything else if you look at global data. Where I was talking about an uptick in the proportion of phase III's was in the RFP flow. I think it's indicative of what we talked about, which is more assets coming into the later phases of development. That's a good thing. That's good for patients, that's good for pharma, and that's good for CROs simply because the survival rates of compounds get higher the further you go into the development cycle. We think that's an encouraging thing. It's also driving average deal size up. There are some ancillary benefits there. In terms of the business mix, nothing major to report. We said before that direct fee in FSP is growing ahead of direct fee in FSO, and that's just part of the underlying business mix dynamics that we've talked about. I don't see any major departure from that other than to say, as I mentioned on our last call, these very strong book-to-bill numbers we've been looking at are driven by outperformance in FSO rather than FSP, where the numbers tend to correlate much more with revenue growth. There is some encouragement there. I don't think there's anything dramatic in the sector. In terms of TA, honestly, no major change. Oncology remains the single largest part of the book in terms of revenue, albeit when you look at recent opportunity flow and recent awards, certainly cardiometabolic for ICON at least, is broadly comparable. They're both very large sections of the book at the minute. We're fortunate to have a real depth of experience in that domain; we tend to win the significant majority of what we touch. It's also interesting to note the proportion of cardiometabolic research that's ticking up in biotech. That wouldn't necessarily always have been the case, but there's obviously a lot of attraction to obesity and obesity-adjacent areas in recent times. Broadly, in terms of the diversity, I mentioned eight of our top 10 customers by awards in the quarter were either mid-size or biotech. I find that encouraging, not because we're doing less in pharma, but because we determined we wanted to do more in those sectors. That's good. In large pharma, as I mentioned, we've made a priority out of diversifying our sales channels. That is, don't sell them one thing or the other; sell them both. We did add a number of partnership strands to existing partnerships in large pharma with a couple of notable program additions in FSP, which is broadly encouraging as well. Nothing really to add beyond that, Sean. I think it's iterative quarter development rather than anything transformational in Q2. Thank you. Your next question today comes from the line of Jay Lewis from Baird. Please go ahead. Hi. Thanks for the question. You've been talking a lot about the pass-throughs that have remained elevated so far this year and potentially could in the back half, we've seen the book-to-bills in the first quarter and second quarters run higher on the pass-through side than the direct fee side. Usually, you talk about the bookings taking quite a while to translate into revenue given the initial award. Do you think that we should be expecting a further acceleration in pass-through revenue as we're starting to move into 2027? Could you give any color around that and how these bookings could end up phasing into revenue? Thanks. It's a dangerous game predicting the shape of awards you don't already have, Jay, but it certainly wouldn't be unexpected if we saw some sustained strength in that relationship for some time. Not to repeat the answer I gave to Elizabeth, it's not unusual to see pass-through book-to-bill run ahead of direct fee book-to-bill in an environment where the market is trending towards things like oncology and large-scale metabolic disease. I don't think that's unusual. I certainly wouldn't forecast it, but I would reiterate our commitment to come back to the market and give as much color as we can as these things progress, because it's relevant. I've said a million times, I don't particularly mind whether the pass-through carries on a study that doubles or halves. I care a great deal about our ability to find that study, bid on that study, win that study, and then deliver that study in a profitable and sustainable fashion. We do need to give due regard to the pass-through carry because, for you guys and for investors more broadly, it does affect how you look at the difference between top-line, bottom -line, and margin percent versus EBITDA dollar, for example. We'll give as much color as we can. I think it would be a very brave person who sought to define it. I tend to look at it in two different respects. Are we seeing and converting as much of that market, and how are we comparing to others in the space? This is at least the third consecutive quarter where our book-to-bills are industry-leading. I think our net book-to-bill on a 605 basis is probably as good as anyone else's on a 606; I'll take that in the short term. Thank you. Your next question today comes from the line of Justin Bowers from DB. Please go ahead. Hi. Good morning, everyone. If you will, are you able to provide us with a book-to-bill call for the first half of the year on a 605 basis? On EBITDA dollars, should we be thinking about the sequential step-up in Q3 similar to what we saw in Q2 over Q1? Justin, yeah. Q1, the direct fee book-to-bill was 1.3x, and obviously 1.2x in Q2, so roughly about 1.25x for H1. I don't have the number right in front of me, but it would be somewhere in that order of magnitude. Obviously, in terms of the EBITDA dollar step-up as we go through the balance of the year, again, we've obviously laid out a range. I'm not going to give you a point number, but just to reiterate, we are focused on sequential improvement as we go through the year. You obviously saw a reasonable uptick from Q1 to Q2, and we're focused on continuing that progression as we go through the rest of the year. Thank you. Your next question comes from the line of Jailendra Singh from Truist. Please go ahead. Thank you, and thanks for taking my questions. I want to follow up on your comments around cross-selling initiatives. I think you called out in your presentation. Which areas are you seeing the most tangible traction? Is it on central labs, specialty labs, like FSP, or FSO expansion? Just see if you can explain a little bit more about these cross-selling initiatives you're focused on. I think it's a really good question, Jailendra, because it can be interpreted a number of different ways. On the one hand, you could argue when I talk about opening up the sales channels in large pharma to sell more than one service, that's a version of cross-selling for sure. Perhaps the most impactful, though, is the latter inference you'd make in biotech, where customers are less likely to have locked-in partnerships for certain ancillary services like central labs, like bioanalytical, like medical imaging, like cardiac safety, and like patient support. One of the things I've talked about over the last 18 months was making sure that we were giving the best holistic offer to those biotech customers to make sure we were upselling as many of our capabilities as made sense for the customer. Not to say we're pushing capabilities at them that they don't want, to make sure that we're effectively working across our own organization to join the dots. That's seen a significant uptick in the proportion of biotech proposals, for example, that include labs, just to take your example. That was probably running in the high -50s a little over a year ago. It's now somewhere in the mid-70s. That's, I think, indicative of the organization working holistically across internal departments to bring the right capabilities to these customers under one roof. Thank you. Your next question comes from the line of Charles Rhyee from TD Cowen. Please go ahead. Thanks for taking the question. I know people ask about your expectations on pass-throughs within the guide. Maybe can you give us a sense of what your assumption is for direct fee revenue progression, maybe through the rest of the year relative to what we've seen so far in the first half? Nigel, I think you said earlier that SG&A should step back up from Q2, and EBITDA dollar progression is driven by gross profit growth. I understand that Q2 is impacted by pass-throughs, what are sort of the other things driving the improvement in, I would imagine, gross profit dollar growth sequentially? Maybe help us understand what's going to drive that given the fact that you're talking about a higher pass-through environment on the top line. Thanks. Yeah, Charles, happy to take those. Just to bring you back as a reminder, the full-year guide, when we set that, we talked about, again, just for modeling purposes, if you take the midpoint of the range gave on revenue, that essentially reflects an underlying direct fee decline year-over-year organically of around 2%, if you recall that conversation. We also then have an inorganic drag from the divestment of Symphony. We had currency movements on the assumption at the time that pass-throughs would be roughly flat. The direct fee component of the overall movement was about a 2% decline year-over-year. That's still, again, the guidance that we've reconfirmed this morning. When you look at H2, where do we see the margin progression? It is from, again, as we spoke about before, as we go through H2, some of those mix effects that we talked about that are impacting the margin year-over-year compared to last year mitigate somewhat as you go through the second half of the year. Then, of course, we've also spoken about the cost actions that we've taken as well that will kick in a much greater degree in the second half. It's that operating discipline around cost control as well as, again, improving the mix effect as we go through the rest of the year that will drive the gross margin expansion that we're expecting to see. Thank you. Your next question comes from the line of Jack Meehan from Nephron Research. Please go ahead. Thank you. Hello, everyone. I wanted to ask about the guidance range through the lens of EPS. If you look at years 2024 and earlier, the range was always a lot tighter. I understand the pass-throughs can have these dynamics on the top line and margins, but just where we sit today, just any comments around where you think you're trending within the EPS range? That's one question. The second is you have this cash hoard growing on the balance sheet. Sorry if I missed it earlier, but just timing for getting back to buyback. Thanks. Thanks, Jack. That second thing on buyback, we did touch that earlier on. It remains our intention to get back in the markets, as we had outlined previously. The strong cash collection of the quarter improved the financial position, and we'll be pleased to do that. Returning capital to shareholders is a priority. I think your point on the EPS guide is well made. The pass-through question obviously drives significantly more volatility on the top line than it does on the bottom line. To Nigel's earlier point, we do choose our ranges very carefully. In reiterating them, we're mindful of the same considerations. While I wouldn't point to specific numbers, what I would say is for modeling purposes, the ranges we gave you are the ranges we're giving you again, and we put a lot of thought into it before doing that. As always in this business, there's a lot of work to do. We've talked about stepwise progression, quarter-over-quarter, one foot in front of the other. The bookings on the top line are encouraging. The conversion into revenue. Somebody asked me about burn rate a minute ago, and maybe I didn't touch on it. The burn rate itself is naturally just mathematically suppressed a little bit by the strong book-to-bills we've been posting. I'm concerned with the underlying burn rate. How effectively are we burning those studies that are running such that we're generating revenue? Obviously very careful management of our costs to ensure we do that incrementally more profitably than previously. Nothing new to give you on the EPS guide. I appreciate it is a reasonably wide range at this point in time. It's also just about two months since we issued the guide. I think I would set that expectation with you guys that we're probably not going to rush back and revisit the guide every 10 minutes. Albeit I do appreciate having only issued it relatively late in the year. It is a somewhat extraordinary period, and I'm comfortable reiterating it to you and comfortable with the steady progress we're making in undertaking the actions we need to deliver on those expectations. Thank you. Your next question comes from the line of Casey Woodring from J.P. Morgan. Please go ahead. Great. Thank you for taking my questions. I wanted to go back to the comment about RFP flow moderating in large pharma in the quarter. Barry, I think you said there was nothing unusual there. Just curious if you could elaborate on that piece and the outlook for large pharma in the back half. As a follow-up, you guys mentioned investing more in China and talked about the partnership you signed in the quarter with the Chinese biotech for your expanded lab capabilities in the region. Can you maybe just frame up the opportunity in China here, more broadly speaking? Is the lab business an area that you think you can win in that region? Thank you. Yeah, two good questions, Casey. I guess I raised the moderation of pharma proposals in the context of saying I tend not to look at minor movements in intra-sector RFP flow quarter-over-quarter. It's inherently volatile. It's not so much that I would point you to an empirical conclusion, but rather that I would talk you away from one. We did see some fairly sustained, very large value RFP flow in the last couple of quarters. It's down a little bit this quarter. Certainly not out of historical ranges and certainly not a cause for concern. It just so happens that the biotech comparable numbers are up substantially in the quarter. Just given the quantum, I felt it was important to qualify that I think that is indicative of underlying demand, but it's also indicative of a pretty thoughtful strategy about seeing more of that market, meeting that market where it is, going through the motions of some early bidding, and continuing to grow our footprint, not just of what we're bidding on, but of what we're closing. I think that's nothing earth-shattering in RFP, but I hope that's clear. China, I hope I didn't create the impression that that deal we talked about was just a lab deal. It's not. It's a full-service deal, plus labs and imaging. The bigger point on China, I suppose, is it's obvious to all the significance of the surge in Chinese innovation for governments in the West and for biotechs and pharma in the West. It's not necessarily as obvious what that means for CROs in the West, given that a molecule born in China that gets developed out of Boston or the Bay Area doesn't particularly matter where the molecule was born. However, year-over-year, indeed quarter-over-quarter, whether we look at H1 over H1 or Q2 over Q1, there was a notable uptick in opportunity in China. Really quite significant uptick there. Our head count is probably up five points, I think, year-over-year. On a full-year basis, whilst China remains a relatively modest part of our revenues, revenue in China might be up as much as 20% from full-year 2025 to full-year 2026. We think it's an important market anyway. Still trying to understand where we think that market goes in terms of critical mass. For us, it's less important that we understand the end state in 2035, and more important that we build on the very solid footprint we have there, over 1,500 people in country, and that we're able to partner in any one of three ways. Western companies seeking to run global trials in China, Chinese companies seeking to run global trials in China, or, like the example I gave you, Chinese companies going global who require a global partner to bring them beyond their own borders and into the global drug development market. And I'm pretty pleased with the progress we're making in that regard. Thank you. Your next question comes from the line of Michael Ryskin from Bank of America. Please go ahead. Great. Thanks for squeezing me in. A quick one, back to pass-throughs, just sort of a high-level one. You talked a number of times about how elevated they are and why you think they're elevated. I want to go back to that therapeutic mix component. Is there anything else that you think could be driving this, or is it really just the therapeutic mix of where the studies are coming in? I know it's outside of your control, but just the 1.51 number is just sort of optically a crazy high number throughout the entire history of the industry and what we're seeing from peers. Just wondering if there's anything else besides the therapeutic mix in terms of how studies are structured or just sort of like what's behind that, just to put context on, again, why the pass-throughs are so elevated. For my follow-up, I want to pivot a little bit back to your announcement from Tuesday, the multi-year collaboration with Anthropic. You touched on that a little bit in your prepared remarks, but I would just love to hear more from you on what you think the fruits of that would be, when we could see that, how that could impact the business and the model over time. Just sort of walk us through what you think that'll look like in a number of years. Thanks. Happy to, Mike. That's the kind of peer comparison that doesn't keep me awake at night. That's the kind of peer comparison I spend all day trying to have, so I'm okay with it. I think the drivers, though, are beyond TA mix, which is significant. A couple of things we talked about maybe two calls ago. When you look at the rate of inflation in the cost of running clinical trials, it's not so much CRO cost. It's much more driven by healthcare inflation, and particularly healthcare inflation in the U.S. We're living in a time where companies are being heavily incentivized to run a greater proportion of their trials in the U.S., which is not just an expensive market; it's also a market where expense is growing quite rapidly. When we think about the cost of procedures, what it costs now to get an MRI versus what it cost five years ago, in an environment where a lot of sites, particularly major academic institutions, are saturated with requests for clinical trials to run, there is something of an inflationary cycle taking place. I think that's certainly a part of it, particularly around some of the more cutting-edge research and complex therapeutics where we are very heavily represented. It's not everybody who can run those trials. I think we are going to see some of those. The TA mix is significant. If you just look at the patient carry and the investigator grant carry on obesity, on diabetes, and on MASH, these are expensive programs to run, and they will drive up those costs fairly rapidly. The Anthropic piece—happy to talk about it. I think it needs to be spoken about, though, not in isolation. This forms part of a broader AI strategy. An AI strategy isn't about announcing a partnership or managing by press release or counting widgets. This is about a strategy to disrupt the clinical trial lifecycle by embedding frontier capabilities within superior workflows. We have to keep our eye on the prize here. How do we generate shareholder return? We do it by creating value for customers. How do we do that? We do it by generating better insights faster, driving speed and quality of decision-making, taking costs out, and driving predictability up. That's what we're about. When you think about AI, I tend to break it down into four key buckets. There's machine learning that helps us predict better. There's generative AI that helps us create and draft documents better. There are the large language models that are the engine of that generative AI. Then there are the agents, to whom we can delegate whole processes, things that act on our behalf. When you think about the Anthropic and Microsoft partnerships in that regard, they're not adjacent to what we've been doing before. It's not about what's new; it's about what's next. These are building on top of infrastructure we've already built. I would put it to you that the Microsoft partnership is a lot about the platform. There are other productivity tools and Copilot and all that good stuff, but it's about creating the data lakes, having the unified ontology, and having the data mastered such that you can then drive insights from structured data using these frontier AI models. That's really a lot of what the Microsoft partnership is about. It's the foundation. The Anthropic partnership is about building a better intelligence layer. Claude will be the frontier model that is embedded in those workflows. This is a key point. We try and differentiate not just from our competitors but also from our customers. I don't think once an adoption of generic technology is rolled out to 40,000 people is the way to go. You've heard a lot of competitors, including a lot of pharma companies, say they're burning way too many tokens and demonstrating way too little value. What we're about is using these models to embed the back end of work processes. Take Meridian, I've talked with you about before, Mike, the CRA agent. Having a CRA doing tons and tons of paperwork before they go to site, or being able to log on to a customized homepage who knows who they are, what their workload is, what documents they have access to, and point at risks, help them draft documents, help them streamline their interactions with the site, help them have better insights on how long they need to go for, whether they need someone to come with them or what risks they need to bottom out when they get there. That's what we're doing here. That's just one example, right? We're digitizing protocols that help us automate the creation of documents and databases around the company. We're upgrading things like OneSearch, which are predictive models that tell us which sites are best suited to which programs. SmartDraft will now have a Claude back end that helps us build on the progress we've already made, taking 30% out of the time of negotiating clinical trial contracts, as well as a range of functions in the back office, which are really more directly related to productivity than capability. As I say, it's not about what's new; it's about what's next. It's targeted, it's embedded, it's customer-centric, and ultimately it's better. That's really what we're shooting for. Thank you. Your next question comes from the line of Ryan Halsted from RBC Capital Markets. Please go ahead. Hi, thanks for taking my question. Maybe just to follow up on that last point about a broader AI strategy and realizing that AI is being deployed throughout the value chain, beginning with your pharma partners in the drug discovery cycle. Just curious if you are having dialogue with your customers about this potential increased flow and need for increased capacity to handle what could be a deluge of new molecules and new drug targets. Just curious if that's something that you're seeing happening or having dialogue now and/or if you see that having an impact over the near term. Thank you. There's a lot in there, Ryan. The first thing I would say is I'll repeat what I've said for some time, which is I think the impact of AI in drug development may be most evident in discovery in the long term. I think it would be a very naive person who misread this landscape to suggest that there will be a deluge of capacity-determining responses from advances in discovery, which take years to get in the clinic anyway. I think that distracts from the reality of these targeted investments around what AI means now, and frankly, in the years immediately following now. This isn't about having to have a transformational overnight upending of the spectrum. I don't think it's realistic, and I don't know anybody credible who believes it. It's also not about the number of things you are using. We don't measure success by the number of systems we use. We measure it by how few, not how many, if anything. We don't measure success by how many times our customers have to click a button to get an insight. We measure it by how few. This is about power. This is about insights we can generate today, and the interoperability question with customers actually involves sitting at the nexus of work they do themselves, work we do for them within their environment, and work we do for them within our environment, and helping data and data insights flow into the hands of people who need them. I think that's central to understanding the power of AI in the near and indeed in the medium term. Discovery is a very exciting space, but I think it'll be a while before we see transformational changes in the development operations landscape from things that have yet to be proven in discovery. Thank you. We will now take our final question for today. The final question comes from Luke Sergott from Barclays. Please go ahead. Hi, guys. Thank you for squeezing us in here. This is Anna Kruszenski on for Luke. If we could just go back to burn rates and what is embedded in your guidance for the rest of the year after the past three quarters of such strong bookings. Can you talk about how we should directionally be thinking about burn rates in the second half relative to the 9% in Q2? Thanks again. Hey, Anna. It's Nigel. Look, I think, obviously, we've reiterated the guidance range this morning. The burn rates—they likely will take down a little bit just given what we've seen in terms of the commercial performance in H1, which obviously has already been impacted. It'll fundamentally depend on what we do in terms of book-to-bills in H2. I would say it's probably the bigger impact. I wouldn't want to give you any specific numbers on that, but it's going to be driven by that probably more than anything. Thank you. This concludes the Q&A. I will now hand it back to Barry. Thank you, Sharon, and thank you, everybody, for joining today. We appreciate your continued support and the questions today. It remains a process of incremental transformation both on the strategic side and also good quarter-over-quarter diligence and discipline as we continue to close out on the plans that we've discussed today and described today. We look forward to coming back to you in due course and updating you on the next steps. Thanks, everybody. Thank you. This concludes today's conference call. Thanks for participating. You may now disconnect.