Good day, ladies and gentlemen, and welcome to the Medpace second quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's remarks, there will be a question-and-answer session. If you'd like to ask a question, please press star one one on your phone. If your question has been answered and you'd like to remove yourself from the queue, simply press star one one again. As a reminder, this call is being recorded. I would now like to introduce your host for today's conference, Lauren Morris, Medpace's Director of Investor Relations. You may begin. Good morning, and thank you for joining Medpace's second quarter 2025 earnings conference call. Also on the call today is our CEO, August Troendle, our President, Jesse Geiger, and our CFO, Kevin Brady. Before we begin, I would like to remind you that our remarks and responses to your questions during this teleconference may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve inherent assumptions with known and unknown risks and uncertainties, as well as other important factors that could cause actual results to differ materially from our current expectations. These factors are discussed in our Form 10-K and other filings with the SEC. Please note that we assume no obligation to update forward-looking statements even if estimates change. Accordingly, you should not rely on any of today's forward-looking statements as representing our views as of any date after today. During this call, we will also be referring to certain non-GAAP financial measures. These non-GAAP measures are not superior to or a replacement for the comparable GAAP measures, but we believe these measures help investors gain a more complete understanding of results. A reconciliation of such non-GAAP financial measures to the most directly comparable GAAP measures is available in the earnings press release and earnings call presentation slides provided in connection with today's call. The slides are available in the Investor Relations section of our website at investor.medpace.com. With that, I would now like to turn the call over to August Troendle. Good day. RFP flow in Q2 continued to be strong, and we saw an increase in rate of decisions. Total pending RFP dollars were down on the quarter, and our award notifications were strong. Cancellations were down across the pipeline, and awards recognized in the backlog were the highest in the past five quarters, with a book-to-bill of 1.03 in the second quarter of 2025. We continue to see a strong potential for book-to-bills returning to above 1.15 in Q3. Although funding challenges remain acute for many of our clients, the large majority of those clients with ongoing studies were able to obtain sufficient funding to keep the trials running. The funding environment has been stable to improved. Due to several factors, including better funding than anticipated, fewer cancellations, accelerated client decisions, rapid project startup, shifting mix away from oncology and toward faster-burning therapeutic areas, and significantly higher investigator costs, we now anticipate accelerating revenue in the second half of the year. As a result, our revenue guidance has been raised by $280 million at the midpoint. Jesse will now add some additional detail. Thank you. Good morning, everyone. Revenue for the second quarter of 2025 was $603.3 million, which represents a year-over-year increase of 14.2%. Net new business awards entering backlog in the second quarter increased 12.6% from the prior year to $620.5 million, resulting in a 1.03 net book-to-bill. Ending backlog as of June 30, 2025, was approximately $2.9 billion, a decrease of 1.8% from the prior year. We projected approximately $1.75 billion of backlog will convert to revenue in the next 12 months, and backlog conversion in the second quarter was 21.2% of beginning backlog. Now, with that, I'll turn the call over to Kevin to review our financial performance in more detail, as well as our guidance expectations for the balance of 2025. Kevin. Thank you, Jesse. As Jesse mentioned, revenue was $603.3 million in the second quarter of 2025. This represented a year-over-year increase of 14.2% on a reported basis and 13.8% on a constant currency basis. Revenue for the six months ended June 30, 2025, was $1.16 billion and increased 11.8%. Revenue for the quarter was favorably impacted by higher reimbursable activity, particularly at investigator sites, driven by studies progressing ahead of projected schedules and the therapeutic mix shift to faster-burning studies in areas like metabolic, which have a higher concentration of reimbursable cost. EBITDA of $130.5 million increased 16.2% compared to $112.3 million in the second quarter of 2024. On a constant currency basis, second quarter EBITDA increased 18.5%. Year-to-date EBITDA was $249.1 million and increased 9.3% from the comparable prior year period. EBITDA margin for the second quarter was 21.6% compared to 21.3% in the prior year period. Year-to-date EBITDA margin was 21.4% compared to 21.9% in the prior year period. EBITDA margin in the quarter benefited from direct service activities and productivity, offset by higher reimbursable costs and foreign exchange losses behind the weaker US dollar. In the second quarter of 2025, net income of $90.3 million increased 2.2% compared to net income of $88.4 million in the prior year period. Net income growth behind EBITDA growth was primarily driven by a higher effective tax rate in the quarter and lower interest income. Net income per diluted share for the quarter was $3.10 compared to $2.75 in the prior year period. Regarding customer concentration, our top five and top ten customers represent roughly 21% and 31%, respectively, of our year-to-date revenue. In the second quarter, we generated $148.5 million in cash flow from operating activities, and our net day sales outstanding was negative 65 days. During the second quarter, we repurchased approximately 1.75 million shares for $518.5 million. Year-to-date, we repurchased 2.9 million shares for $908.4 million. As of June 30, 2025, we had $826.3 million remaining under our share repurchase authorization program. Moving now to our updated guidance for 2025. For year 2025, total revenue is now expected in the range of $2.42 billion-$2.52 billion, representing growth of 14.7%-19.5% over 2024 total revenue of $2.11 billion. Our 2025 EBITDA is now expected in the range of $515 million-$545 million, representing growth of 7.3%-13.5% compared to EBITDA of $480.2 million in 2024. The increase in our guidance reflects the impact of lower second quarter backlog cancellations, improved funding on several challenge programs, which we anticipate will continue through the remainder of the year, and a shift in business toward faster-burning therapeutic areas with a higher concentration of reimbursable costs. We now expect reimbursable costs as a percentage of revenue to increase by 200-300 basis points over the balance of the year. We forecast 2025 net income in the range of $405 million-$428 million. This increased guidance assumes a full-year 2025 effective tax rate of 18.5%-19%. Interest income of $11.6 million and $29.4 million diluted weighted average shares outstanding for 2025. There are no additional share repurchases in our guidance. Earnings per diluted share is now expected to be in the range of $13.76-$14.53. Guidance is based on foreign exchange rates as of June 30, 2025. With that, I will turn the call back over to the operator so we can take your questions. Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. One moment for our first question. Our first question is going to come from the line of Ann Hynes with Mizuho. Your line is open. Please go ahead. Great. Thank you so much. Could you just let us know what your booking expectations are for the second half? The reason being is that your burn rate stepped up in 2Q, and obviously your guidance implies a step up in 3Q and 4Q. I'm just trying to figure out what that means for 2026 revenue growth. I know you probably want to give guidance for 2026. Do you expect an acceleration in bookings for the second half to support growth in 2026? Thanks. Yeah. As I said in my prepared comments, we do believe that there's a reasonable chance of getting book-to-bills back over 1.15, which implies a considerable increase in bookings as our revenue is also growing. Yes, we do expect bookings to increase. Now, again, that's always dependent upon cancellations, which were very well-behaved in this quarter. Last quarter, they were terribly high. If things continue in the trend we saw in this quarter, then yes, we expect bookings to remain strong through the remainder of the year. Can you provide any more information on cancellations? Like what was the rate this quarter versus what had been trending the past couple of quarters? Yeah. We don't disclose the actual rate, but it was down across the entire portfolio. So both sort of the non-backlog, awards before they get to backlog, was very low. And our backlog cancellations that have been at or above the upper range of what we'd consider normal, they're actually toward the lower end of expectations or usual history in this past quarter in Q2. They were actually very well-behaved, and that, of course, made us exceed what we felt we were going to do in terms of both bookings and overall performance in terms of revenue and EBITDA. Perfect. Thank you so much. Thank you. One moment as we move on to our next question. Our next question is going to come from the line of David Windley with Jefferies. Your line is open. Please go ahead. Hi. Thanks for taking the questions. I've got a few I'll try to go through quickly. On the burn rate, I'm not quick enough on the calculator. I heard, Kevin, you say that you do expect pass-throughs to be 200-300 basis points higher over the balance of the year. That, I think, contributes in part to the higher burn rate. I was hoping you could maybe walk me to water a little bit on how much of the increase guide is pass-through versus direct revenue. Yeah, Dave, I mean, obviously, a large portion of the increase is going to be on the accelerated reimbursable cost activity, right? But we did increase also. The EBITDA guide as well. And so we're also seeing some pull-through on just greater productivity on the existing staff and, quite frankly, some programs that are progressing ahead of what we had projected in our schedules. So it's a combination of both, but the revenue in particular is certainly heavily influenced by that 200-300 basis point increase in expectations on the pass-throughs. Okay. Last night, on this topic, we looked at kind of the pattern in 2023 where you also had an increase in revenue and a good chunk of that coming from pass-throughs. Sounds like maybe not quite that extreme, but similar. To get the EBITDA increase that you just mentioned on effectively the direct revenue portion, which sounds like the minority, you're having to get pretty high incremental margin, as you just alluded. Management has been talking for the last, I don't know, year at least, that staff productivity has been increasing, that you were at levels that were above historical records and probably not much upside room there. I'd ask you to elaborate a little bit on how you're able to squeeze additional productivity out. To support the revenue growth and your bookings expectations, I would guess that you're expecting to kind of take the shackles off hiring a little bit and accelerate the hiring. How should we expect that to impact margin over the next couple of quarters? Thanks. Yeah, Dave, you're right. I mean, I didn't expect productivity to continue from what we saw in 2024. Certainly, we've reduced our hiring expectations a little bit coming into the year. We're also seeing improved attrition rates again, furthering in the past couple of quarters. All of that is contributing to, I still expect some headwinds on a net basis in 2025 relative to where we are in 2024. You're right, certainly improved versus where we were coming into the year. Last question for me quickly is, August, your comments around funding are interesting to me. Certainly, our trackers, not the gospel, certainly, but we have seen some predictiveness out of it. Funding year to date is pretty bad, really. June was much better, but we're down over 40% year to date. How do you get comfortable? I mean, I know you have a lot of visibility into the awards that you have in hand that aren't even in backlog yet. How do you get comfort that the weak funding through the first six months of this year is not essentially foreshadowing another downturn in demand activity for you, as it did in 2023 ahead of 2024? I guess I don't get myself comfortable with that. I mean, I thought we probably hit a bottom in Q4. But then cancellation. Yeah. A big part of all of our difficulty the last year has been cancellations, not new projects and baseline level of business. Certainly, the last nine months. It's really been just really heavy cancellations. If they get adequate funding, I don't know what subset that is of the total pool of funding you're talking about, but we get comfortable with that, and we can make our numbers. Could things pull back again and really impact 2026? Sure. That's quite possible. I have no idea. I do know that we have a good pipeline of things awarded, but not yet reaching backlog that should support good bookings through the remainder of this year, again, as long as cancellations don't rear their head excessively. That should at least get us started into 2026. Is it possible there's a pullback in the future and we run into another very weak booking quarters? I don't know. Okay. Appreciate the answers. Thank you. Thank you. One moment as we move on to our next question. Our next question comes from the line of Jailendra Singh with Truist Securities. Your line is open. Please go ahead. Thank you. Good morning and congrats on a strong quarter. I actually want to follow-up on the last part of David question. I mean, it seems like macro environment and business pipeline when we caught up in early June was still choppy and pressured. Keeping that in mind, can you provide some color around how intra-quarter trends were in 2Q? Did the majority of trends suddenly accelerate towards the end of Q2, essentially like latter part of June, and those trends have continued? Just give us some flavor how demand environment evolved in Q2 in particular. Yeah. I mean, Q2 was. Again, it was really a continuation of Q1 in terms of. The business environment continued to be pretty strong in terms of RFPs. As I said in Q1, they were strong. It was really cancellations that. Backed off quite a bit. That was sort of throughout the quarter. As I said, cancellations were actually low. On the low side this quarter as opposed to being very high in. The past and certainly in the prior quarter. It was across the quarter. I mean, I did not see any real. Trends of acceleration or deceleration in the quarter. Okay. My quick follow-up on these trials which were delayed or kind of put on hold, coming back, new trials, business wins. Are you seeing in any ways the scope being different? Are you seeing a reduced scope of work, or is it a similar scope of work as you guys agreed on? Related to that, is there any meaningful variations around EBITDA margin if the project comes at lower scope or reduced scope than previously planned? Yeah, sure. A number of projects were downscoped. You see that in any environment. I don't know that that was particularly prevalent, but you do see some downscoping and largely delays. I mean, slower startup, hold off on certain regions, kind of keep the study running, but don't execute as fast as you could otherwise. Those are the kind of things that clients do to try to keep things alive while they don't have adequate funding. Obviously, your profit is going to be impacted by that. Yeah. I mean, the most profitable project for us is the project that runs the fastest. If it's delayed, if it's downscoped, if it has some gating, etc., that impairs our ability to execute and to make a profit on it. Great. Thanks for taking the questions. Thank you. One moment for our next question. Our next question is going to come from the line of Max Smock with William Blair. Your line is open. Please go ahead. Hey, good morning, everyone. Thanks for taking our questions. Just wanted to follow-up on some of the questions that have already been asked around book-to-bill in the back half of the year, and in particular, your commentary about getting back to 1.15. If you do that in the back half of the year, I think that implies bookings are up more than 40% year- over- year. Just trying to get a sense for when you're talking about getting back to 1.15, do you need to see further improvement in funding or the demand environment to get there? If you think about there not being improvement from today, what do bookings look like if the environment essentially remains unchanged from 2Q? Should we expect some more net awards in the back half of the year, roughly in line with the 620 that you posted in the second quarter? Yeah. I don't know how to answer that. Bookings in the— Give me the first part of that question again. Were the bookings? Yeah. If I'm just thinking about your guide and your commentary about 1.15 book-to-bill in the back half of the year, I mean, that implies net bookings up over 40%. Just trying to get a sense for how much visibility you have into that. What's embedded in the outlook to get back to 1.15? Do you need to see further macro improvement? If you don't, what does book-to-bill look like in the back half of the year? Sure. I think that. It's macro improvement. It depends whether all of our cancellations have been related to funding. And I think a good part of them were, yes. We do have to see cancellations remain lower. I don't need to see new strong business environment with new opportunities. We need to see things progress along and not be held up by funding or other factors. The current quarter, Q2, was relatively low on cancellations. If that continues, I think we're going to be there. If it's in the mid to upper range of cancellations, we're getting right on the edge. I mean, I think prior to last quarter, prior to the prior quarter, Q1, in which we had a lot of cancellations, particularly in the pre-backlog bucket, things that we expected to be converting in this next quarter, in the next couple of quarters, a lot of things dropped out and made it a lot closer on being able to get back to that 1.15. I think it's still not anywhere near a slam dunk. I think that if things continue the way they have in this past quarter, I think we'll be there. How much more weakness and increased cancellations can occur, I don't know. That answers your question. Yeah, it does. I'm sorry for the long-winded question on my end. Maybe just one on competition and win rate and what you saw there in the second quarter. Maybe how much of your results are more a reflection of you all taking share more so than a broader rebound in demand environment from small biotech. Yeah. No, I was hoping not to have to talk about win rate. It was not great in the quarter, actually. It was more an issue of more decisions. As I said, in the prior quarter, Q1, things were not being decided. Things were being held up. A lot of funding issues. The go-ahead was not being given on new awards. They were not making decisions. Our pending RFP dollars increased quite a bit. That came down in this past quarter because there were a lot of decisions. Our win rate on those decisions was not particularly high. There were a lot of decisions. Actually, awards were good. I mean, we actually had a very good new award quarter, but on a lower-end win rate, competitive win rate. That is something that bounces around quarter to quarter. I never make anything out of a single quarter down. The prior quarter was fine. We will see. Got it. Thanks again for taking our questions. Thank you. One moment for our next question. Our next question is going to come from the line of Michael Cherny with Leerink. Your line is open. Please go ahead. Good morning and thanks for taking the question. Maybe if I could just dive a little bit more on the trajectory in the back half into 2026, in particular on the step-up in pass-through business. I think, Kevin, please correct me if I'm off here, but you said 203 basis points of increased pass-through business baked into the numbers of the back half of the year. Is this something, especially given the results this quarter, that should be a new normal going forward, or is this just a matter of luck of the draw, timing on the types of contracts that are currently hitting your backlog? Yeah. I mean, certainly in the near-term, it's going to be the new normal. And again, it's heavily influenced by just the mix that we're currently seeing and areas where there is a higher concentration of reimbursable costs. So yes, in the near-term, I would say it's going to be elevated. How long does this last? I'm not going to provide commentary on 2026 at this point. But certainly, the balance of the year, we do expect it to be and continue to be elevated. Understood. I won't poke further at the implied 26 numbers at this point in time. Maybe just a follow-up, August, to your last comment regarding the win rate and the win rate dynamics. I certainly understand how it can bounce around on a quarter-by-quarter basis. With the win rate, was there anything from a disease state perspective, or any other piece's perspective that characterized why you think the win rate shook out where it did? Or was this also just a random dispersion across your book? Yeah. No. I mean, look, it is always concentrated because, I mean, the factor is very large programs. We're less likely to win, okay? I mean, we're talking about—and there were some very large programs in that. If— And so size of project and our experience in this area and our experience with the client—now, obviously, if it's a new client and it's very large and they've got existing providers, our win rate is going to be lower. That is what bounces around quarter to quarter. We won the projects we expected to win. Unfortunately, in that quarter, in this past quarter, there were some very large— We are talking about dollars. When I talk about win rate, it's dollar-based. A very large program is a good part. I mean, it actually is—a single program can be a substantial part of the total wins or losses in the quarter. It just happened to bounce down in this past quarter. We did lose a—it was two very large projects in that. No, I can't—it was not like we're weak in a particular therapeutic area or some trend or subset. It just happens to be what projects we're close to and which ones were really large. One last really quick one, if I may, as the market's opening, your stock's up a lot. I know the guidance does not assume any more buyback, but conceptually, given the outstanding authorization you still have, how are you thinking near-term balance sheet utilization and the potential for incremental buybacks? It's more of the same, Michael, that we'll continue to be opportunistic. In buying at levels that we see to be very accretive. If our plans don't execute, then we're okay building cash. We're very happy with what we were able to execute in the fourth quarter, first quarter, and second quarter of this year. Got it. Thank you. Thank you. One moment for our next question. Our next question is going to come from the line of Eric Coldwell with Baird. Your line is open. Please go ahead. Thank you very much. I have a few, hopefully not too repetitive. I was hoping we could start with talking about, following on that last line of questioning, just talking more broadly about the bookings dynamics this period. There was some speculation going around last night based on the big increase in revenue that maybe you had picked up some large studies. It does not sound like that happened this quarter, anything particularly crazy large. I was hoping you could just maybe more specifically tell us what your largest win individually was in the quarter. If there were any rescue awards or losses that you could talk to, maybe just broadly talk about competitive dynamics. You did mention your win rate was not the best, but talk a bit about competitive dynamics, just hoping to get a little more flavor on the bookings mix and breadth of those bookings to start. Sure. Yeah. Eric, I think your question kind of, I don't know, in my head, confuses some of the moving parts here. When we're talking about competitive wins and we're talking about wins, etc., those are awards. Notifications. They're not in backlog yet. We're not making any revenue off them. It's often multiple quarters before they come in. A new award this quarter is not going to influence our revenue or anything like that. A booking would, probably, because that's when we're starting to get revenue. It could be late in the quarter. It might not be much of a factor. It's mostly in future quarters that that's going to impact. If I look at just sort of new notifications this quarter, no, nothing particularly stands out. There's nothing particularly large. It was a pretty usual quarter. In fact, the really large stuff, we lost. Our competitive win rate was actually on the lower side, but completely understandable if you took out a couple—there were two outliers. Our win rate was great. I mean, it was fine. That's not an issue. What went into bookings this quarter? Nothing particularly unusual or notable. The big—and there was nothing sort of a rescue or something, a really short-term project that we won during the quarter or something that added to it. It was just kind of usual stuff that progressed, that a lot of it we did not anticipate it might progress. Sort of good upside news on things progressing and we thought might not. Things went faster than expected. We maybe didn't do as great a job at projecting what some of the pass-through, how quickly things were going to move forward on some of the investigator fees, etc. That part of it, I think on a direct fee basis, we were probably pretty good at projecting it. There were still projects that went forward, more than we expected and faster than we expected. There was some upside. There was nothing kind of unusual in terms of short-term, quick, or interim, or rescue work, or anything like that. Okay. On the reimbursable indirect revenue commentary, and I hate to be this myopic, especially since it's been talked about so much, but I want to make sure I'm 100% clear. When you talk about 2-300 basis point increase in mix for the rest of the year, can you clarify? Does that specifically mean you're looking at something 41%, 42% + in the second half? Or does that mean something more like 38%, 39% for the full year compared to 2024 total levels? I'm just not 100% clear what that plus 2-300 basis points specifically is in reference to or what the absolute percentage you're targeting is. Yeah, Eric. Yeah. Thanks for asking the question. To clarify, that's relative to what we saw in the second quarter. Yeah, we could see this in the low 40% the back half of this year. Okay. And then last one for me for now. You have obviously kind of shocked the street with this update. You have enormous backlog conversion already. Now it is going up to 41.5%-42.5% in the second half. Your backlog is down 2% year- over- year, but you are seeing revenue growth as much as 27% in the back half at the high end of the range. I mean, there is just a lot of questions about sustainability. I know it is so hard to project with the mix shift in reimbursables, which are seemingly clearly driving the majority of the revenue increase. Those may or may not continue next year. What can you give us today that can help us understand the jumping-off point from these conversion rates and these growth rates as we look at 2026? I mean, everybody, I know you are not guiding now, but we all have to build models and do assessments for next year. You have caught us so off guard. I think, I will admit, at least I am scrambling to understand what kind of a growth rate we might be looking at in the next year. It does not feel sustainable, to be honest. Then again, I did not see this quarter coming, so. Yeah. Eric, you broke up a little bit in the middle of that, so. But I think I heard enough of it to—so if I do not cover it, then. Jump back. I think that. Yes, we have had a significant shift towards. Faster-burning stuff. And part of it, our conversion rate is high overall. Because. The lower denominator. And of course, does that mean that we are going to burn off our backlog and then we are going to have a real gap? I do not think that is necessarily true. I think that. We do have an adequate business environment to. Replenish things. I do think that our indirects are ramping because of. A shift toward metabolic work. I do not know how long that is going to last. If it continues, then okay, I think our growth rate next year is probably fine. If that pulls back, then I think that it can challenge growth rate. That is because of a drop in reimbursables. I think on a direct fee basis, we are going to do fine. I think our profitability is going to—there is no reason to see it dropping off. I think that we could have growth rates similar to this year, ex the pass-through stuff, right? I do not know. We do not have the model next year. It is really dependent upon stuff that is. Coming in now and over the next couple of quarters. Twenty twenty-six is. Not really addressable, but. We do not have a reason to believe that we are going to have a challenge next year. And have our growth go to zero or something. Unless pass-throughs drop drastically and all of our growth is direct fee. I do not really see that as a. On a 605 basis, we would be fine. Completely understood. Appreciate the commentary. Thank you. Thank you. One moment as we move on to our next question. Our next question is going to come from the line of Luke Sergott with Barclays. Your line is open. Please go ahead. Great. Thanks for the questions. I just kind of want to figure out. We've talked a lot about the moving parts. Everybody's focused on the burn rates, etc. You have this elevated burn rates. Everything stepped up materially. You had a big step up in bookings. You didn't need to hire additional SG&A for the type of revenue growth that we would typically think. You had DSO step up materially also in the quarter. It doesn't sound like you picked up some ongoing work from someone else or share gains. I'm just trying to figure out what's going—what actually drove this step up in everything and trying to foot all these different metrics. A drop in cancellations. I mean, look, we've been running at growth rates of 20%+ for a long time. Things dropped back. We did have a weakening environment. Still, our fundamental growth rate, I think, is pretty good ex a lot of unusual cancellations. Now, that's part of the same package. I mean, the same environment that causes the cancellations reduced opportunities to some extent. I don't know. How do you close the loop on those things? The environment is reasonable if cancellations are reasonably behaved. Our conversion rate is up because we've dropped both two major factors. The denominator has not grown as expected, and we have a shift towards faster-burning stuff. I mean, we're in an era of a lot of metabolic type of programs, particularly in the obesity space, are an important part of the market. That's made things have a faster burn turnaround. Otherwise, I think the big step up from our expectation was less cancellations than we anticipated. Okay. And then I guess just to follow on that, your backlog that you guys report, so anything over 12 months, that's included there, took a pretty big step down in the quarter. It's been declining the last few quarters. That makes sense with everything you're saying, like faster burn rates and some more near-term stuff. As you think about as this starts to roll off, what's the average timeline of these faster-burning trials as we think about into 2026 and 2027? I mean, that's like to Eric saying, we're all trying to model here of what we're seeing for 2026, and the range just gets really wide. Yeah. I mean, I can't give you an average for overall categories or something like that. Look, long studies can be 6-10 years in duration. Oncology studies are classically kind of that, and they run a very long time, and it's a slow burn. Metabolic studies, some of these can run in two, three years and have a larger proportion of indirects as a part of it. Indirect, usually the model is the direct fees burn a lot faster up front toward the beginning. That's when a lot of work is being done in organizing and setting up and getting the trial ongoing and recruited. A lot of the investigator fees are later on when patients are enrolled and having lots of visits. There's usually an acceleration. The direct fees are the first half of the study heavy, and the second half, it's investigator costs. In a metabolic study, like I said, they can be very fast, and it all happens at once. Okay. And then just real quick from the last one, as I think about from the margin and the hiring needs to meet these trials, we talked about the efficiency on your existing base. And you guys do not do FSP, and you have a really strong culture where the attrition rates are really low. How should we think about your hiring needs in the back half if you are going to be able to sustain these types of burn rates and elevated growth? Yeah. Back half of the year, we do expect accelerated hiring. We expect to hire more in the second half than we hired in the first half. We still think we'll be kind of in the mid-single digit to kind of upper mid-single digit growth rate for the year. As we move into the third quarter and fourth quarter, depending on a lot of factors, including the business environment and new opportunities and activity, we have opportunities to accelerate that beyond that. Right now, we're very comfortable with current headcount levels and projections to handle the current and future projects. It is dynamic, and we can adapt as we go. Great. Thank you. Thank you. One moment for our next question. Our next question is going to come from the line of Charles Rhyee with TD Cowen. Your line is open. Please go ahead. Yeah. Thanks for taking questions. I just wanted to follow-up on some of the questions from earlier. August, it sounds like what you're saying is that what we've really been seeing over the last year or so plus with the funding environment, that's really tied, really that's where cancellations have come in, people that can't get funded, projects cancel. That projects themselves, new RFP, that flow has never changed. Has that always been constant over this last couple of years? I wouldn't say that's not changed. I'm saying that I think the big outlier, the biggest component for us, has been very elevated cancellations. They've held things back quite a bit. I'm not saying that the overall environment, certainly over the last few years, hasn't weakened from kind of the COVID high. It came back, and it's been weaker. There's weaker funding overall, so you have less attractive opportunities. RFPs don't necessarily reflect what's going on. Last year, there were certainly weak overall opportunities, and sometimes people looking for a price that they could get it done at, etc., and less opportunity. The biggest thing of late has been cancellations that, just like I said, I thought we were past it all in Q4, and I thought this was the bottom, and things are improving. The biggest gap hasn't been the improved fundamental opportunities that we started seeing in Q4, okay? The business environment started before that. Yes, we had real weakness in everything, but the business environment seemed to be okay on new opportunities the last several quarters. Cancellations just last quarter were horrendous, and that has been probably the biggest uncertainty in our modeling, cancellations rather than new opportunities and new awards. They're both components of it, but it's really been the cancellations that have thrown us off. This past quarter, Q2, showed a great improvement in that, but we saw a great improvement in Q4. I don't know. We'll see. Q1 was, it spiked again. In terms of this quarter, cancellations were obviously much lower relative to Q1. Anything that, when you look at reasons for cancellations, are the cancellations, are those all tied to funding, or is that, how much of that maybe is changing priorities from sponsors? You can never sort that out entirely. I think they're very highly related. Reprioritization is sometimes another word for cutting back. I don't know. I do think the funding environment has been a critical part of the vast majority of cancellations. Okay. You talked about earlier faster-burning therapeutic areas like metabolic. When we look at revenue contribution by category, that is sequentially the same in metabolic. It was sort of this other category. We saw a big step up in the quarter. Can you give us some examples of a therapy area in that other bucket that you saw this big pickup? I am just curious what kind of visibility you have or how much of your upcoming pipeline of RFP activity is in this other bucket and what kind of visibility you have into that? Yeah. No. I mean, and it's a bunch of different things. There's nothing that sort of is the vast majority of it or something. Look, the big trend has been metabolic over the last year. You look at our metabolic revenue and awards, and they've been a higher percent of the overall. They will continue. Because of the awards, they're going to continue for the next couple of quarters anyway to be a growing part of our overall revenue base. They tend to be overall, some of them are long-term, etc., but overall tend to be faster-burning and higher indirect fees. Great. Maybe last one for me. You talked about faster decision-making. Anything that you can elaborate on, what that might be? Is that just maybe with drug pricing kind of being kicked out, with MFN maybe towards the end of the year and just people deciding, "Hey, you know what? We can't wait forever, and so we just got to make decisions now," or anything that could maybe point to why decision-making maybe has picked up again? No. I think that's funding again. I mean, I think we saw things somewhat seizing up. Our pending RFP dollars, that is RFPs we've received, we've made a bid on, and are just sitting there waiting for a response and no decision and no go-forward on things, even that we have been awarded. They say they're going to, yes, they're going to use us. They agree to the budget, but then they want to hold off on things until, I think largely that's sometimes, there's other reasons. There's drug supply, there's other waiting on some other information on the drug, etc., another study may be completing, whatever. There's lots of reasons. Funding is a big part of it. I think we've seen a more rapid execution on sponsors' side to move forward and give us authorization and get us stuff that we need to move forward as has been funding-related. Okay. Great. I really appreciate the comments. Thank you. Thank you. As a reminder, if you would like to ask a question, please press star one one on your telephone. One moment for our next question. Our next question is going to come from the line of Justin Bowers with Deutsche Bank. Your line is open. Please go ahead. Hi. Good morning, everyone. Jesse, just a quick cleanup question. On the employee growth, you were breaking up a little bit, but it sounded like accelerated hiring in the second half. In mid to upper single digit. Is that for the second half, or is that for the full year? Yeah. Accelerated hiring in the second half. So hiring more second half than the first half. Mid to high mid single digit for the full year roughly. Okay. So second half employee growth should be mid to high single digit year- over- year? Correct. I think we're talking about the full year would be high single digit growth over the prior year. Oh, okay. So then you're looking at. Obviously, it has to increase something like around double digit. Kind of. Yeah. For the six months, year to date. We grew revenue 1.5% or so. We expect that to accelerate. We hired, I'm sorry, 2.5% for the first half. The headcount growth is up 2.5% for the six months. We expect a growth rate in the second half at or slightly above that for the second half. Okay. So you're expecting? Which would equate to a 5% or 6% for the full year. Okay. All right. In terms of what's the growth this year, the top line that you're forecast, what does the guidance assume for growth on a 605 basis for the top line? Yeah. Justin, we do not provide a 605 basis look. I think if you just model it kind of using the guidance that we have out there and assume kind of the 2-300 basis point increase in reimbursable cost over the balance of the year, you can kind of back into what that could be. Okay. In terms of it sounds like the burn rate is fairly sustainable, likely to increase in the back half of the year. What does the pre-backlog or your current authorizations, but not yet in backlog, the mix look like? Is that similar to what the revenue composition has been like this year, or are there any notable differences to call out? Again, we're seeing. In terms of therapeutic mix? Yeah. We're seeing a move towards more metabolic, and that'll continue, it looks like, based upon anticipated awards. Yeah. Okay. On the cancellations, there are really two things that jump out. One was just the improved execution and the changes there during the quarter, and then clearly the cancellations cited as well. When did that start to really inflect or turn? Was that something that, was that sort of May where things really started to change, or was that exiting March? Yeah. I do not have the monthly breakout. We kind of reconcile these things quarterly. There is not a good—I mean, we obviously do know the date of notification of something, etc., but I have just not tried to sort out when exactly cancels and if they were low in March before this quarter began or did not start until May after the quarter was well into it or what. Pretty much across the quarter, we had lower cancellations. I cannot—I just do not have the good data of just when you call it a—and what do you mean by when? It is kind of—they give us a notification, but we do not really know what is happening. Then they finally reconcile what exactly we are going to do to close this thing down. These are kind of things that have a period to them. Look, I think Q2 was much lower than Q1. Okay. Maybe just one last one for me online. What was change order activity like during the quarter, and how did that change from 1Q or even what you saw towards tail end of last year? I don't have the numbers on just what the magnitude of change orders were, but there's nothing been particularly unusual there. Yeah. Justin, I wouldn't say there's anything unusual in change orders. They happen all the time, but nothing that would stick out. Okay. Nothing. Okay. One thought was that. Look, again, change orders, sometimes they award something. It's going to be a global study of this, but they want to award it first as just the first region or something. Then we're going to planning in six months to—and you don't have the budget for it till then. What's even a change order? It's difficult. It's when we get authorization and then when it meets our criteria for going into backlog. Okay. Thanks. I'll catch up after the call. Thank you. One moment for our next question. Our next question comes from the line of Kyle Crews with UBS. Your line is open. Please go ahead. Hey, thank you for taking the question. You've historically disclosed around a high single digit revenue exposure to cell and gene therapy. Can you talk about the impact of Sarepta recently having their clinical trials put on hold and kind of the pausing of the platform technology designation there and the impact to your company? Thank you. Has no impact to us. Can you maybe speak more broadly to the cell and gene therapy market and what you've seen there and if you're still that exposed to it? Look, we don't have a great deal of exposure to the overall area, but we certainly do have exposure. I don't think there's—we're not to Sarepta. They're not to—it's not a—I don't think it's going to have an impact on our programs, but. Thank you. Thank you. I'm showing no further questions at this time. I would like to hand the conference back over to Lauren Morris for any closing remarks. Good. Thank you for joining us on today's call and for your interest in Medpace. We look forward to speaking with you again on our third quarter 2025 earnings call. This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.