Good day, and thank you for standing by. Welcome to Science Applications International Corporation's Fourth Quarter Fiscal Year 2026 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. You will then hear an automated message advising your hand is raised. To withdraw your question, please press 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to John Raviv, Vice President of Investor Relations. Please go ahead.

Good morning, and thank you for joining Science Applications International Corporation's Fourth Quarter Fiscal Year 2026 Earnings Call. My name is John Raviv, Vice President of Investor Relations, and joining me today to discuss our business and financial results are Jim Reagan, our Chief Executive Officer, and Prabhu Natarajan, our Chief Financial Officer. Today, we will discuss our results for the quarter that ended January 30. Please note that we may make forward-looking statements on today's call that are subject to known and unknown risks and uncertainties that could cause results to differ materially from statements made on this call. I refer you to our SEC filings for a discussion of these risks. In addition, we will discuss non-GAAP financial measures and other metrics, which we believe provide useful information for investors. These non-GAAP measures should be considered in addition to and not a substitute for financial measures in accordance with GAAP. A more fulsome explanation of these measures can also be found in our SEC filings. It is now my pleasure to turn the call over to our CEO, Jim Reagan.

Thank you, John, and thanks to everyone for joining our call. I am happy to be here as CEO, and I am grateful to our board, to our team, and to all of our stakeholders for the faith that they have put in me to continue the critical work of sharpening our focus, strengthening our execution, and driving better results. After a thorough search for a permanent CEO by a leading executive search firm, the board concluded that, among other things, maintaining continuity and leadership, along with deep industry knowledge, was essential to Science Applications International Corporation's long-term success. After careful consideration, they selected me for the role. And, honestly, when I stepped in as interim CEO in October, I did not expect to enjoy the role as much as I have. One of the most rewarding aspects has been working alongside an outstanding team supporting critical customer missions and creating value for our stakeholders. This includes my partnership with our CFO, Prabhu Natarajan, whose leadership has been invaluable. So while accepting the permanent role was not my original intention, I am humbled and honored to have this opportunity. Since joining the board in 2023, my appreciation for Science Applications International Corporation's past achievements, current strengths, and future potential grew even deeper with a career focused on operational excellence and value creation across this industry. I am excited to continue building on our strong foundation to deliver meaningful results to all of our stakeholders. FY 2027 is a year of commitment. We are committed to our strategy to align and focus the portfolio. We are committed to improving our internal processes and external results. And as always, we are committed to serving our customers' most important missions, including elevated operational tempo around the globe. The tragic reality of war underscores…

Thank you, Jim, and good morning to those joining our call. My comments today will focus on a review of our fourth quarter and full year results, our outlook for FY 2027, and the meaningful opportunities we see to create value for shareholders. Turning to slide four, our fourth-quarter results were consistent with the update we provided on February 11. We reported fourth-quarter revenue of $1.75 billion, representing an organic contraction of approximately 6% due primarily to a $60 million year-over-year reduction of low-margin revenue from the Cloud One program we no-bid and a $45 million headwind related to a nonrecurring software license sale in the prior-year fourth quarter. Full-year revenue of $7.26 billion declined approximately 3% organically primarily due to our decision to no-bid low-margin Cloud One revenue, which was an approximately $200 million headwind for the year. We reported adjusted EBITDA of $181 million in the quarter, resulting in a margin of 10.3%, which reflects strong program execution and recently enacted cost-efficiency efforts. This performance contributed to full-year margin of 9.7%, which is roughly 20 basis points ahead of the guidance we provided last quarter. We continue to see meaningful opportunities to improve margins in the near future while also investing to drive innovation and growth. Adjusted diluted earnings per share was $2.62 in the quarter, and $10.75 for the year, and benefited from stronger margins and a favorable tax rate which offset lower revenues. Free cash flow was $336 million in the quarter, and resulted in full-year free cash flow of $577 million, a robust result as we remain focused on maintaining our peer-best cash conversion and deploying the capital to maximize long-term value for all stakeholders. Turning to slide six, I want to put the fiscal year 2026 results in context. It was a year of…

And wait for your name to be announced. To withdraw your question, please press 11 again. In the interest of time, we ask that you limit yourself to one question and one follow-up. Our first question comes from Jeremy Jason on behalf of Citi.

Hi, this is Jeremy Jason on John Gaudin. Team, I just want to kind of hit things off by saying, Jim, congrats on your role. I just want to ask, now that you have moved from the interim role to the permanent one, what is the single most significant sort of portfolio pivot you believe is required to align the company with the next roughly ten years of government budget priorities? And more importantly, what is the message you want to say to the investor base who are trying to bridge that between your experience and the specific issues like recompetes have hampered growth in recent years?

Yeah. Well, thanks for your kind words, Jason. I think that for, first of all, the moment that I stepped from being an interim to being the permanent person in charge, it was pretty amazing how my perspective changed from managing the day to day and being focused on getting our business development function back in gear, which is still a focus of mine, but adding to that the need to reassess our strategy, which is a process that we normally undertake during the summertime and I am actively engaged in right now. I think it might be premature for me to announce any strategic pivots other than a couple of notes that are probably worth providing for you. First of all, the first thing that I think that we needed to do, and I think of it as a bit of a pivot, is to get focused on those areas where we have the right to win and those areas where customer retention is the reward for innovation and strong performance. And the thing that we have been seeing over the last year has been the things that are more commoditized where you are not only finding it more difficult to differentiate and keep customers but it is also more difficult to get paid for the hard work that we do. On some of the more vanilla enterprise IT, things are things that we want to continue doing to the extent we have got it, but also to deemphasize it as kind of a strategic imperative. So that, I think, is the first epiphany that it did not take very long for me and Prabhu to wrap our heads around. I think that the next thing is to start moving into some pretty hard focus on realizing the benefits of the business model we acquired with SilverEdge. We think that the things that we have acquired from them on the intellectual property side as well as some of the capabilities that we have to serve our intelligence customers with AI enablement in classified networks is something that we think is extensible beyond the customers that they brought with them, and we are working to leverage that. Probably have more to talk about in terms of any further strategic pivots as we work through the strategy process through the season. Probably you are going to get that. I am not interested. Okay. Thanks. Appreciate it, Jason. Thank you so much.

Our next question comes from Jonathan Siegman with Stifel.

Hey. Good morning. This is actually Sebastian Rivera on for Jonathan Siegman. Congrats to Jim as well on the full-time position now. I guess we would love to kind of hear your thoughts regarding the FY 2027 guidance, roughly $35 million of CapEx here. I get it does not suggest too much change relative to last year, and I believe that FY 2026 number was about $4 million lower than the year prior. And I guess would have thought the changed environment today kind of creates incremental opportunities to invest, but we would love to get your thoughts there.

Sure. And appreciate the question, Sebastian. Because, you know, with what we have today in hand, we think that the CapEx is adequate to meet the current demand signals that we have on programs that require production capacity that largely exists in a number of our, for the programs where we actually make things. But I think that in Prabhu's remarks, he mentioned that we have a flexible business model, and we are in active discussions with customers about what they might see as the need to ramp up production on certain programs. And to the extent that we get the demand signals, which, by the way, I have talked to senior leadership at the Department of War. They understand very clearly that industry, when they receive demand signals, they could pivot. We are no exception. To the extent that we get demand from customers to ramp up production of certain weapons capabilities, we are prepared to increase the plant capacity, increase space, spend money on tooling, to meet those demands. The revenue and the take rate on those is not reflected in the guide today. But to the extent that there is any reason to update it in future, we will certainly let you know. But so I think that the short answer to your question, Sebastian, is we have a business model, and we are prepared to flex it. And we are prepared to spend more money on additional capacity to the extent that our customer comes to us and asks for it.

Hey, Sebastian. Prabhu here. Thank you for the question. I think the only thing that I would add to Jim's response is that we are investing where we see clear demand signals. And we are engaging with customers at their highest levels on some of these opportunities. I would also think of the $100 million cost reductions as freeing up capacity for investment that may not show up in CapEx necessarily, but it does provide us some ammunition to be able to invest in some differentiation as we go to market in a handful of areas. Finally, I would also say that investment takes many forms. We actively think of the investments that we make to include the time we spend with customers, helping understand needs, shaping solutions to fit the needs, and then actually actively investing in a business development and capture function that allows us to be more differentiated when we offer, I think, real solutions. We are also investing—SilverEdge is a classic example of investing a couple hundred million off our balance sheet to be able to fund, to bring some real new capabilities into the organization. And I think finally, but certainly not the least important of which, is we are actively building capabilities, whether that is mission labs, or our Mission Data Platform, or our classified. There are areas that show up beyond a CapEx line that we are investing in. And finally, I would foot-stomp the fact that we are investing in some really key talent, and Jim talked about the Chief Growth Officer we brought to the company. But we are investing in some real talent inside the organization, refreshing our org structure. And so our investment has taken multiple forms. But we are very comfortable that we are investing in line with the signals that we are getting, and we are frankly not waiting for contracts to start the investment. We are trying to get ahead of where the needs are going to be so that we can be ready for when those things show up in a pipe somewhere. So thank you for the question.

Thank you. Very helpful. I just a quick—

Our next question comes from Gavin Parsons with UBS. Thank you. Good morning.

Good morning. Jim, I mean, you have been sharpening the BD process for a few months now. I know that is ongoing. How long does that take you to build momentum and actually start converting that to revenue and how much opportunity is there on a shorter-term basis to drive maybe some OCG growth?

Yeah. It is a great question, Gavin. I think that there is kind of two elements to that answer. The first one is to say that, as you know, the sales cycle in this business, converting a proposal into revenue, can take a painfully long period of time in some cases, not in all. I think that to the extent that our team is able to move the needle on win rates on work that is already in production in the proposal shop and build some more innovation, perhaps even some more discipline around how the finished product comes out, that can move the needle on win rates within six months. I think it is probably worth noting that while we were disappointed by the outcome on a couple of these large recompetes during the year, our win rates on new work in the year, but the most recent quarters, has been in line with our expectation and industry averages. So I think that we are really pleased with that and with, you know, less exposure in FY 2027 to the large recompetes like we had some significant exposure last year. I feel really good about our ability to achieve the kind of book-to-bill that we need to get us back on a growth trajectory after we have lapped out the impact of these losses that we have recently experienced. I think that the last comment that I would have, and Prabhu might want to amplify on this as well, is that one of the things that I think that we are doing really well already is ensuring that the spend and investment on capture and winning work is focused on the $28 billion or so of opportunities that we have the greatest opportunity to win, to differentiate, to drive margin improvement in the business, in addition to whatever margin improvement we are going to be seeing out of the business initiatives that we have been outlining. This year, we have called it addition by subtraction earlier, and what that really means is that focusing on the things that will drive higher win rates and higher opportunities to retain customers for longer.

Thank you, Jim. Hey, Gavin. Appreciate the question. Maybe a couple of data points on the guide itself. We are right now assuming about a 2% to 3% OCG in our current baseline guide for fiscal 2027. That is consistent with our 2% to 3% last year, which was the lowest of the five years that I have been here. So while we are not expecting things to get better, we do not expect things to get worse either on those, and therefore, on balance, I would say bias to the upside to the extent that the enacted budget translates into tangible procurement action over the course of the next three quarters or so. I think, as Jim said, I would foot-stomp the fact that our win rates on non-enterprise IT work—some of the work we do on the engineering side as well as the mission IT side—our win rates on new have approached 50% or more at various points over the last couple of years. So our win rates really demonstrate, I think, that we have the right to win in these areas. And I think just as importantly, our recompete win rates on noncommoditized enterprise IT is sort of in that 85% to 90% range. So good win rates outside of the commoditized enterprise IT work and, again, while it does not help lose these recompetes, the reality is I think there is very little of that left in the portfolio at this point. As we said in the prepared remarks, about 10% left of revenues from large, I would say, cost-plus EIT work. And so I do think that on balance, we are probably at the other side of this slope here. And given that we have about 5% of recompete headwinds, with the $400 million or so that we disclosed, the reality is the absence of this headwind going into next year is going to be a tailwind in and of itself. So again, I think we feel good about where the positioning is. None of this matters. None of what I say matters unless we execute well, and this is a message internally as well as externally. But we have got to keep every recompete that comes our way. And we have to keep up the win rates on new, and that is where the focus is for the team.

Thank you for that.

Our next question comes from Sheila Kahyaoglu with Jefferies.

Morning, guys. Thank you. Congrats, Jim and to Joe as well. Maybe two questions if I could start. The first question would be just on the, you know, what do you think on the enterprise IT work? And I know Prabhu did a good job of this at conference, so thank you, Prabhu, for that. Like, what changed? Was it a Science Applications International Corporation decision? Did the competitive landscape change? And then as we think about the $25 billion pipeline, how do we think about Science Applications International Corporation getting on the offensive?

I will start. I think Prabhu might amplify on my enterprise IT answers. I think that what we have seen is increasingly customers—there is a handful of our customers that are buying based on what I might say is kind of more of a cookie-cutter recipe for what they are looking for, where it is heavily embedded with network management, network uptime, help desk support, things that are harder to differentiate than in the things that blend more of a mission focus in with the IT side. Think about on the—maybe one of the more toward mission IT, it is probably supporting networks that support the warfighter and networks that blend multiple areas of information and synthesize it into a pane of glass for people that do mission planning. Those are the things that we think that we can continue to excel at or earn our share on recompetes and new work. So I think that when we stepped back and took a hard look at different flavors of enterprise IT work, that gave us some greater visibility into the kind of things that we would continue to pursue, continue to win, and the things that we are probably going to deemphasize in our pipeline going forward. Probably everything, Dan. Yeah.

Sheila, a couple of things I would probably want to add. I think the recognition that, you know, being selective on, I would say, cost-plus enterprise IT was sort of a conclusion we came to over the course of the last several months. I think, if you looked at the track record of where our largest recompete challenges have been, and it does not take a bunch of research to get to NASA Aegis, parts of Cloud One, U.S. CENTCOM, Army RITS, I think the common thread line running through all of these is that it is very hard to differentiate on predominantly cost-plus work where it is very hard to separate yourself from the competition. And sometimes the magic is in how one writes a proposal more than what the delivery on the ground looks like. So I think it is just a recognition that we have come to. We also had perhaps more of that enterprise IT work in our pipeline five years ago than we do today. So that has been a gradual evolution. Our decision to consciously no-bid $200 million of compute and store as part of Cloud One—candidly, we contracted 3%. All of that 3% was related to one decision to no-bid that Cloud One contract. That was a recognition that we communicated externally that, you know, that is not the kind of work we want to be doing long term as we think about focusing the resources of the company into meaningful areas that will truly, I would say, restore and reassess the legacy of this company. So I think it is an evolution of what we have come to in terms of our own portfolio. Broadly speaking, I would say if you looked at competitors and where win rates are for enterprise IT versus non-enterprise IT work, you will see some of the same, I am going to say, volatility in recompete win rates within our competitors. I think the reality was we had more of it than perhaps others, but you should expect to see some of the same volatility. And then finally, on the pipeline question, the only thing I would add to the comment that we are playing more offense than defense is the fact that our pipeline is inflecting to higher levels of non-EIT work, mission work, engineering work, and more of our opportunities on our submits this year and next year are more towards the takeaway side than the recompete side. Our largest single recompete coming up is our Vanguard Department of State program that we are feeling really good about. Had it for fifteen years. We have done it for fifteen years, and candidly, I think that is our sentiment underlying the narrative that we get to play a little bit more offense this year than we have had the luxury of the last couple of years. Thanks, Sheila.

Our next question comes from Gautam Khanna with TD Cowen.

Good morning and congratulations, Jim. And John and Joe. I wanted to just ask, within the midpoint of the guidance, maybe if there is any parameter you could tell us on how much you have to quite go get. You know, you told us about on-contract growth, but based on the backlog you have today, how do you get to—what do you still need to bid and turn, if you will, in the year? And then if you could just remind us of when the year-over-year headwinds on the $400 million of recompete losses abates, you know, when is the last quarter that that becomes the headwind, that one moves out of the numbers? Thank you.

Hey, Gautam. Prabhu here. Thank you for the question. I will take the guidance one. In terms of the negative two to negative four of contraction, as I said earlier, we are assuming nominal amounts of OCG, 2% to 3% of OCG, and not a ton in the way of new business go-get. And so I think very much focused on what is within our control this year, and not a lot of assumptions built in around what we need to win in order to actually get to the guide that we have out there. So I think there is always going to be a mix of some recompetes and new that is in the mix in the business. Our backlog is sufficient with our trailing twelve-month book-to-bill of 1.1. I think the backlog exists for us to get to the guide without a lot of heroics this year. But that is how we wanted to position the conversation coming into this fiscal year compared to perhaps last year where we had a little more in the way of go-gets and, of course, we had a tremendous amount of disruption from those and other procurement disruptions over the course of the year. So I think it is very much a guide that we have control over, that the team is fully committed to, and does not take a ton of heroics for us to get to over the course of the year. But candidly, that means we just have to put our head down and execute every single quarter. In terms of the headwinds, on a quarterly basis, I think I would say it is fair to assume that the headwinds are going to persist with us for all four quarters of the year. I think that is probably the most sensible way to think about it. Naturally, there will be some changes over the course of the quarter as we lap on some programs and lapped into some other programs. But the reality is you should assume that there is about four quarters of headwinds and that Q1 of next year is probably going to be the cleanest quarter on a compare basis.

Terrific. Thank you. Alright. Goodbye.

Our next question comes from Colin Canfield with Cantor Fitzgerald.

Hey, thank you for the question. Maybe focusing on FAR 3.0. If you could talk a little bit about federal acquisition regulation and essentially what you are hearing in terms of kind of the next set of objectives look like, what that means for Science Applications International Corporation, and any sort of timing around outcomes. Thank you.

Sure. I had the chance to meet with a senior Department of War official about that just this past Friday, along with some other CEOs in a small forum. And I think that, first of all, there is tremendous urgency that we have not seen in decades around procurement reform in general, including updates and upgrades to the FAR. There is a lot that I think we can expect to see stripped down and stripped out, and some new provisions put in there are going to be really aimed at improving speed and throughput from the defense industrial base. I think that with that said, there is going to be some spotty implementation. And there is a large acquisition community that needs to be retrained, needs to be upskilled, reskilled. But in the meantime, when the need exists, I think that our customer in the building is going to be relying on things like OT, OTAs, other innovative contracting vehicles, including the use of commercial pricing and commercial contracting mechanisms to get what they need done faster. That said, we do have a commercial operating segment that is available, and we are actively using it to bid some of these things that the customer is needing. We have made some changes in our own procurement and contracting organization to be ready to meet the requirement for speed. And we have an internal initiative aimed at not just handling it from the procurement side, but also how we bid differently. And that is one thing that our new Chief Growth Officer is actively engaged at so that we can meet the customer demand when they bring it to us.

Got it. Got it. And then maybe as you think about kind of your future as a hardware integrator, can you just perhaps talk about kind of your relationship and your opportunity set across the branches? We have seen obviously a lot of capital start to flow into VC-developed products, but not as much focus on kind of the integration of all of the capabilities. Right? There are the leading players, but you still have a lot of stuff that is kind of series B, series C, that fundamentally will need something like Science Applications International Corporation's kind of acquisition pipeline or the creds around national security and the cleared folks. So can you just maybe talk about, within that context so far, how you think about Science Applications International Corporation's ability to go and integrate a lot of these kind of earlier-stage products? Thank you.

Hey, Colin. Prabhu here. I will take that one. I think you are hitting on something that is incredibly important. The strength of the total defense industrial base is going to be relevant and necessary to deliver what the warfighter needs. And so I think there are folks like Science Applications International Corporation that are in the ecosystem that have for decades brought evolving capabilities to the warfighter because we have an acute understanding of how the mission works. And I do not think that that demand signal is going to look any softer in the next five years. So we are actively partnering with venture companies. We have a venture program that we are very proud of, that we actively bring capabilities, integrate them in the number of hardware-software integration centers we have across the country, whether that is Huntsville, or Charleston in South Carolina, or in Crane, Indiana, where we do a tremendous amount of hardware and software integration, and we are just getting better at that kind of work. And there is a decent chunk of it in our pipeline, and so I do think that we have the sort of mission set, if you will, where our expertise and our mission and our domain understanding is going to be critical as we graduate more of these smaller companies into the larger ecosystem. So we are looking forward to partnering with them. And, as you know, this is how this business, this industry, has evolved over the last, I would say, fifty years, and I do not expect the next twenty or thirty to look any different. I think, to be fair, some of the new entrants have put, I think rightfully so, pressure on the incumbents to deliver faster, better capability, and at cheaper prices. I think that competition is a good thing. So we are looking forward to it, and we are doing a really nice job integrating some really good capability into the ecosystem.

That is great color, Prabhu. Thank you.

You bet.

Our next question comes from Tobey Sommer with Truist.

Thanks. You mentioned the evaluation that you have ongoing is the first, I think, bottoms-up evaluation on processes and so forth since the split, but the company has been trying to address these issues for a number of years. Maybe the process is different this time, but the pursuit is an ongoing one. How do you manage the culture and the morale when you are sort of reexamining something that has been kind of a focal point? And do you envision any changes in compensation as being helpful in achieving your end?

Toby, I appreciate that question. I think at least once or twice every week, I get an email from one of our 23,000 employees applauding what we are doing and giving me some real-life examples of things that we could do differently to help them get their jobs done easier. Sometimes they are seemingly mundane, but still important. Some of them are things that I would not have been made aware of had someone not sent me an email directly. And I look at that. I read it. I send it to the team in the program office that is running this. So I would say that the employees are saying, finally, we are doing some things to get some of the gunk out of the system. Gunk is a technical term for me on this, and we are definitely working hard in getting this program to get things working better, faster, more efficient, not just for our internal teams, but it also will translate into gains for our customers as we are able to be a bit more nimble. So I would say that there is tremendous receptivity to this, and I think that it is going to allow us to make decisions faster, get stuff done faster, but also take a lot of the cost that is going to fall out of that and reinvest it into the things that we have been talking about in terms of growth. I think that we have the capability with that to add more account management teams, people who are walking the halls of the building, to bring new ideas to customers and increase the daily communication about what we need to do to help them be more successful. And with that, I think it is probably one of the most important things that we are going to get done this year.

Our next question comes from Noah Poponak with Goldman Sachs.

Hey, good morning, everyone. Morning, Don. Is it possible to give us the details of recompetes of size that you have in your fiscal 2027 and fiscal 2028, just kind of cover the next two years, which programs, when, and how big are they for you now in revenue?

Hey, Noah. Prabhu here. I will take the first stab at this. I think, you know, if I think about significant programs, as you know, with 10% to 20% of the business comes up for recompete every year. So if I think about the largest recompetes out there, Department of State Vanguard is the single largest program that is going through a recompete cycle in fiscal 2027. Okay? And that program, as we know, the scope of the program is increased. We are on year fifteen of that program, and we have been qualified to bid and compete for work on four of the five workstreams. The one workstream that we chose not to bid because it would have created the OCI for us for the other four workstreams. So that is the single largest recompete that we have. Beyond that, we always have programs that are in the, I am going to say, $75 million to $150 million range. Let us call it 1% or 2% a year. We always have one or two of those every year, but in reality, we are also bidding a multiple of that in the form of takeaway opportunities in the pipeline. So I tend to not think of those actively as, you know, sort of significant recompete risk. I think the reality is the way we are approaching this, Noah, is keep as much of the work share on Vanguard as possible, hopefully even eke out a little gain there. But our baseline assumption right now for this year is that we have accommodated all kinds of contingencies into the minus two to minus four. But Vanguard is probably the only one that is worth calling out right now.

When will you be recompeting that? And can you size it for us approximately annual revenue for you?

Yeah. So we will be going through a recompete cycle on Vanguard. Again, it is going to go by workstream to workstream. There are four workstreams that will get recompeted over the course of this year. We are the incumbent. We will be competing for all four. We have been qualified to compete, and we are in the down-selected category. And so it is unlikely to materialize in terms of impacts to revenue anytime, I would say, safely in the first half of this year. If anything, we may have some nominal impacts in the second half. But I say nominal. So more of the impacts, if we were to be in an unfortunate position of not keeping most of that work, most of that impact will be felt next year and not this year. So that is how I would probably preface it.

Okay. And then would it be possible to talk about how the funding environment has evolved year to date? I know that is a short-term question. Maybe it gets into splitting hairs. But just given the, as you described, the funding of obligated dollars has been slow and choppy and uneven. In January, it sounded like some in the industry saw that getting better. I am just curious if that improved through the quarter or got worse through the quarter? Is it better or worse today or the same versus how the year ended?

Yeah. I am going to say, the health warning here is that whatever I say now is probably going to be OBE probably at the end of the week. But here is what we have seen. I think it is true that January for outlays was better than the preceding three months for sure. I think on outlays, as you know, there is probably about a three-month lag between outlays and revenue performance. So a good January month on outlays means that April, May should look healthier than it would have looked otherwise. I think the more important milestone that we are tracking to is a milestone in the second quarter of our fiscal year, sort of the June, July, August timeframe. Certainly, June or July, if you look at where the agencies are relative to their—relative comparing outlays to the appropriations or the budget amounts, I think that will tell us if we are going to see a year-end flush in terms of money that needs to be spent before the end of the government fiscal year. So that is probably the clearest goalpost that we would say is out there. But in reality, we do think that the appropriations have to get spent; therefore, the money will have to come. I think for us, it is very much a question of timing and how quickly is the spigot going to open up. And this is where the constraints on the government procurement functions have been difficult to size and estimate. But hopefully, things get better here, certainly in the second half, from the summertime through the end of the fiscal year, Noah. Then perhaps, an immediate change in the first quarter of this fiscal year for us.

I understand. Okay. Thank you.

I am showing no further questions in queue at this time. This concludes today's conference call. Thank you for participating. You may now disconnect.