Q4 2025 Fortrea Holdings Inc Earnings Call

February 26, 2026

At this time, all participants are in a listen-only mode.

After the speaker's presentation, there will be a question and answer session.

To ask a question during the session, you will need to press star 1. 1 on your telephone. You will then hear an automated message. Advising your hand is raised to withdraw your question. Please press star 1 1 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. Tracy crew, me senior vice president of investor relations.

Please go ahead.

Thank you.

Good morning everyone and welcome to Port Trias, fourth quarter and full year 2025 earnings conference call.

With me today on the call is onshore there--all chief, executive officer, and director and Joe McConnell Chief Financial Officer.

Operator: Good day. Thank you for standing by. Welcome to the Fortrea Q4 and full year 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will hear an automated message advising your hand is raised. To withdraw your question, please press star one 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, Tracy Krumme, Senior Vice President of Investor Relations. Please go ahead.

Speaker #1: Good day and thank you for standing by. Welcome to the Fortrea Q4 and full year 2025 earnings conference call. At this time, all participants are in a listen-only mode.

Before we begin.

Please note, this call is being webcast. There is an accompanying, slide presentation, which can be found on the investor relations section of our website for tria.com.

Speaker #1: After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 1-1 on your telephone; you will then hear an automated message advising your hand is raised.

During this call, we'll make certain forward-looking statements within the meaning of the private Securities. Litigation Reform, Act of 1995.

Speaker #1: To withdraw your question, please press star 11 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, Tracy Krumme, Senior Vice President of Investor Relations.

this statements are subject to significant risks and uncertainties that could cause actual results to differ materially from our current expectations,

Speaker #1: Please go ahead.

Speaker #2: Thank you. Good morning, everyone, and welcome to Fortrea's fourth quarter and full year 2025 earnings conference call. With me today on the call is Anshul Thakral, Chief Executive Officer and Director, and Jill McConnell, Chief Financial Officer.

Tracy Krumme: Thank you. Good morning, everyone, and welcome to Fortrea's Q4 and full year 2025 Earnings Conference Call. With me today on the call is Anshul Thakral, Chief Executive Officer and Director, and Jill McConnell, Chief Financial Officer. Before we begin, please note this call is being webcast. There is an accompanying slide presentation which can be found on the Investor Relations section of our website, fortrea.com. During this call, we'll make certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to significant risks and uncertainties that could cause actual results to differ materially from our current expectations. We strongly encourage you to review the reports filed with the SEC regarding these risks and uncertainties.

We strongly encourage you, to review the reports filed with the FCC regarding these risks and uncertainties in particular. Those are described in the cautionary statement concerning for looking statements and the risk factors in our press release and presentation that are posted on our website.

Please note that any 4 looking statements represent our views as of today, February 26th?

Speaker #2: Before we begin, please note this call is being webcast. There is an accompanying slide presentation, which can be found on the Investor Relations section of our website, Fortrea.com.

2026. And that we assume no obligation to update the forward-looking statements, even if estimates change.

during this call, we will also be referring to certain non-gaap Financial measures

Speaker #2: During this call, we'll make certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to significant risks and uncertainties that could cause actual results to differ materially from our current expectations.

These non-gaap measures are not Superior to or a replacement for the comparable, gaap measures, but we believe these measures provide investors with a more complete understanding of results.

Speaker #2: We strongly encourage you to review the reports filed with the SEC regarding these risks and uncertainties, in particular those that are described in the cautionary statement concerning forward-looking statements, and the risk factors in our press release and presentation that are posted on our website.

A Reconciliation of non-gaap financial measures to the most directly comparable. Gaap measures is available in the earnings press release. And the earnings call presentation slides that are provided in connection with today's call.

Tracy Krumme: In particular, those that are described in the cautionary statement concerning forward-looking statements and the risk factors in our press release and presentation that are posted on our website. Please note that any forward-looking statements represent our views as of today, 26 February 2026. We assume no obligation to update the forward-looking statements even if estimates change. 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. We believe these measures provide investors with a more complete understanding of results. A reconciliation of non-GAAP financial measures to the most directly comparable GAAP measure is available in the earnings press release and the earnings call presentation slides that are provided in connection with today's call.

Lastly, I would like to add that anel Jill. And I will be attending the Barkley's Global Healthcare conference on March 10th in Miami.

Speaker #2: Please note that any forward-looking statements represent our views as of today, February 26, 2026, and that we assume no obligation to update the forward-looking statements even if estimates change.

If anyone would like to meet with us on these dates, please contact me or a sales representative from The Firm.

and with that, I'd like to turn the call over to anaw, the call Chief Executive Officer and director on Shaw, please go ahead

Speaker #2: 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 provide investors with a more complete understanding of results.

Thank you, Tracy. Good morning, everyone and thank you for joining us today.

I'm pleased to report our fourth quarter and full year 2025 results.

Speaker #2: A reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures is available in the earnings press release and the earnings call presentation slides that are provided in connection with today's call.

Before I begin, I want to express my sincere appreciation to our colleagues across Port. Tria our board of directors, our clients, and our broader stakeholder community.

This was my first full quarter here hard as that is to believe. Given How Deeply rooted? I feel at Fort Tria?

Speaker #2: Lastly, I would like to add that Anshul, Jill, and I will be attending the Barclays Global Healthcare Conference on March 10th in Miami. If anyone would like to meet with us on these dates, please contact me or our sales representative from the firm.

Tracy Krumme: Lastly, I would like to add that Anshul, Jill, and I will be attending the Barclays Global Healthcare Conference on 10 March in Miami. If anyone would like to meet with us on these dates, please contact me or a sales representative from the firm. With that, I'd like to turn the call over to Anshul Thakral, Chief Executive Officer and Director. Anshul, please go ahead.

The progress, we will cover today. Reflects a tremendous amount of dedication across our entire Global community and I'm proud to share it with you today.

We delivered solid fourth quarter and full year performance in line with our guidance, despite a challenging and uneven operating environment.

Speaker #2: And with that, I'd like to turn the call over to Anshul Thakral, Chief Executive Officer and Director. Anshul, please go ahead.

Jill will walk through the financials in more detail, but I want to highlight a few key points up front.

Speaker #3: Thank you, Tracy. Good morning, everyone, and thank you for joining us today. I'm pleased to report our fourth quarter and full year 2025 results.

Anshul Thakral: Thank you, Tracy. Good morning, everyone, and thank you for joining us today. I'm pleased to report our Q4 and full-year 2025 results. Before I begin, I want to express my sincere appreciation to our colleagues across Fortrea, our board of directors, our clients, and our broader stakeholder community. This was my first full quarter here. Hard as that is to believe, given how deeply rooted I feel at Fortrea. The progress we will cover today reflects a tremendous amount of dedication across our entire global community, and I'm proud to share it with you today. We delivered solid Q4 and full-year performance in line with our guidance, despite a challenging and uneven operating environment. Jill will walk through the financials in more detail, but I want to highlight a few key points upfront. We delivered revenue and adjusted EBITDA in line with our full-year expectations.

Speaker #3: Before I begin, I want to express my sincere appreciation to our colleagues across Fortrea, our board of directors, our clients, and our broader stakeholder community.

We delivered revenue and adjusted Ava in line with our full year expectations. We closed the year with a Q4 book to Bill of 1.14 times and a trailing 12-month book to Bill of 1.02 times.

Reflecting Improvement in demand during the second half of the year.

Speaker #3: This was my first full quarter here. Hard as that is to believe, given how deeply rooted I feel at Fortrea. The progress we will cover today reflects a tremendous amount of dedication, across our entire global community, and I'm proud to share it with you today.

We generated positive operating and free cash flow in Q4, resulting in positive, operating and free cash flow for the full year.

Speaker #3: We delivered solid fourth quarter and full year performance in line with our guidance, despite a challenging and uneven operating environment. Jill will walk through the financials in more detail, but I want to highlight a few key points up front.

Anshul Thakral: We delivered solid Q4 and full-year performance in line with our guidance, despite a challenging and uneven operating environment. Jill will walk through the financials in more detail, but I want to highlight a few key points upfront. We delivered revenue and adjusted EBITDA in line with our full-year expectations.

Importantly, we exceeded our gross and net savings targets, delivering approximately 153 million in growth savings, and 93 million in net savings for the year.

We continued to strengthen our balance sheet through disciplined Debt. Pay down using cash on hand reinforcing, our commitment to improving our capital structure.

Speaker #3: We delivered revenue and adjusted EBITDA in line with our full year expectations, we closed the year with a Q4 book-to-bill of $1.14x, and a trailing 12-month book-to-bill of $1.02x, reflecting improvement in demand during the second half of the year.

We expanded our leadership, team welcoming Aggie Gallagher as general counsel in the fourth quarter.

Anshul Thakral: We closed the year with a Q4 book-to-bill of 1.14 times and a trailing 12-month book-to-bill of 1.02 times, reflecting improvement in demand during the second half of the year. We generated positive operating and free cash flow in Q4, resulting in positive operating and free cash flow for the full year. Importantly, we exceeded our gross and net savings targets, delivering approximately $153 million in gross savings and $93 million in net savings for the year. We continued to strengthen our balance sheet through disciplined debt paydown using cash on hand, reinforcing our commitment to improving our capital structure. We expanded our leadership team, welcoming Aggie Gallagher as General Counsel in Q4. More recently, we appointed Dr. Scott Dove to lead our clinical pharmacology business.

Speaker #3: We generated positive operating and free cash flow in Q4, resulting in positive operating and free cash flow for the full year. Importantly, we exceeded our gross and net savings targets, delivering approximately $153 million in gross savings and $93 million in net savings for the year.

Of to lead our clinical pharmacology business Dr. Orin Cohen. Who previously LED this business is now fully dedicated to his role of chief medical officer where he is focused on strengthening our clinical development and medical expertise. As we continue to leverage our scientific and therapeutic experience with customers.

Stepping back to the broader environment, the macro backdrop remains cautious, but importantly, it continues to show signs of stabilization and early recovery.

Speaker #3: We continued to strengthen our balance sheet through disciplined debt paydown using cash on hand, reinforcing our commitment to improving our capital structure. We expanded our leadership team, welcoming Aggie Gallagher as general counsel in the fourth quarter.

Funding activity, rebounded. Meaningfully in the second half of 2025.

With the strongest activity in the fourth quarter.

Large Pharma budgets have largely stabilized following pipeline, rep prioritization. And the market is currently signaling improving biotech funding flow through 2026.

Speaker #3: More recently, we appointed Dr. Scott Dove to lead our clinical pharmacology business. Dr. Oren Cohen, who previously led this business, is now fully dedicated to his role of Chief Medical Officer.

With this backdrop, we are seeing higher client engagement levels.

Anshul Thakral: Oren Cohen, who previously led this business, is now fully dedicated to his role of Chief Medical Officer, where he is focused on strengthening our clinical development and medical expertise as we continue to leverage our scientific and therapeutic experience with customers. Stepping back to the broader environment, the macro backdrop remains cautious, but importantly, it continues to show signs of stabilization and early recovery. Funding activity rebounded meaningfully in the second half of 2025, with the strongest activity in Q4. Large pharma budgets have largely stabilized following pipeline reprioritizations, and the market is currently signaling improving biotech funding flow through 2026. With this backdrop, we are seeing higher client engagement levels, shorter decision-making timelines, and more concrete customer conversations, particularly within biotech.

Shorter decision-making timelines and more concrete customer conversations, particularly within biotech.

Speaker #3: Where he is focused on strengthening our clinical development and medical expertise, as we continue to leverage our scientific and therapeutic experience with customers. Stepping back to the broader environment, the macro backdrop remains cautious.

That said we continue to expect our recovery to be somewhat uneven in the first half of 2026, which reflects the new business wins. We saw earlier in 2025,

Speaker #3: But importantly, it continues to show signs of stabilization and early recovery. Funding activity rebounded meaningfully in the second half of 2025. With the strongest activity in the fourth quarter, large pharma budgets have largely stabilized following pipeline reprioritizations, and the market is currently signaling improving biotech funding flow through 2026.

Looking further ahead, we're cautiously optimistic about building momentum in the second half of the year as Outsourcing Trends, remain steady and access to Capital looks to improve.

Through all of this, our Focus remains unchanged.

Disciplined execution, and positioning for Tria to win as demand continues to recover.

Our solid performance is built upon 3, pillars of Excellence.

Commercial, operational and Financial.

Speaker #3: With this backdrop, we are seeing higher client engagement levels, shorter decision-making timelines, and more concrete customer conversations particularly within biotech. That said, we continue to expect our recovery to be somewhat uneven in the first half of 2026, which reflects the new business wins we saw earlier in 2025.

We use these pillars to prioritize our actions and measure our progress in our journey to growth and margin expansion.

I'll provide an

Anshul Thakral: That said, we continue to expect our recovery to be somewhat uneven in the first half of 2026, which reflects the new business wins we saw earlier in 2025. Looking further ahead, we're cautiously optimistic about building momentum in the second half of the year as outsourcing trends remain steady and access to capital looks to improve. Through all of this, our focus remains unchanged. Disciplined execution and positioning Fortrea to win as demand continues to recover. Our solid performance is built upon 3 pillars of excellence: commercial, operational, and financial. We use these pillars to prioritize our actions and measure our progress in our journey to growth and margin expansion. I'll provide an update on our commercial excellence and operational excellence pillars, while Jill will discuss the financial excellence pillar.

on our commercial excellence and operational excellence colors while Jill will discuss the financial Excellence pillar

Starting with commercial excellence.

We secured significant new and repeat wins in the quarter underscoring.

Differentiated capability.

Speaker #3: Looking further ahead, we're cautiously optimistic about building momentum in the second half of the year as outsourcing trends remain steady and access to capital looks to improve.

And the strength of our client relation.

Speaker #3: Through all of this, our focus remains unchanged. Disciplined, execution, and positioning Fortrea to win as demand continues to recover. Our solid performance is built upon three pillars of excellence: commercial, operational, and financial.

Q4 notable wins included, a long-term clinical pharmacology. Partnership Award with the top 5, large Pharma company. Several fsp renewals from long-standing, large Pharma clients and a healthy balance of base 2 and base 3, Global clinical development, wins across biotech, mid-size Pharma and large Pharma as well as across.

Various therapeutic areas.

Overall, I really like the mix of our current pipeline.

Speaker #3: We use these pillars to prioritize our actions and measure our progress in our journey to growth and margin expansion. I'll provide an update on our Commercial Excellence and Operational Excellence pillars, while Jill will discuss the Financial Excellence pillar.

As I said last quarter, we have a commercial framework to expand our commercial opportunities, which we call the 3 RS, reach, relevance, and repeat.

Speaker #3: Starting with commercial excellence, we secured significant new and repeat wins in the quarter. Underscoring both our differentiated capabilities and the strength of our client relationships.

Anshul Thakral: Starting with commercial excellence, we secured significant new and repeat wins in the quarter, underscoring both our differentiated capabilities and the strength of our client relationships. Q4 notable wins included a long-term clinical pharmacology partnership award with a top five large pharma company, several FSP renewals from long-standing large pharma clients, and a healthy balance of phase II and phase III global clinical development wins across biotech, mid-size pharma, and large pharma, as well as across various therapeutic areas. Overall, I really like the mix of our current pipeline. As I said last quarter, we have a commercial framework to expand our commercial opportunities, which we call the three Rs: reach, relevance, and repeat. These three Rs guide how we are rebuilding growth, strengthening execution, and improving consistency across the organization. First, reach, extending the top of the funnel and increasing access to customers.

These 3 RS guide, how we're rebuilding growth, strengthening execution and improving consistency across the organization.

First reach expanding the top of the funnel and increasing access to customers.

Speaker #3: Q4 notable wins included a long-term clinical pharmacology partnership award with a top five large pharma company, several FSP renewals from longstanding large pharma clients, and a healthy balance of phase two and phase three global clinical development wins across biotech, mid-sized pharma, and large pharma, as well as across various therapeutic areas.

Over the last several quarters, we've taken delivered actions to broaden our aperture.

We've restructured our Global sales organization to increase capacity, and capabilities focused on Hunting new plant relationships.

Speaker #3: Overall, I really like the mix of our current pipeline. As I said last quarter, we have a commercial framework to expand our commercial opportunities which we call the three Rs: reach, relevance, and repeat.

We're building our inside sales, otherwise known as our reach engine focused on early stage. Qualification new to portray a prospects and general biotech Outreach.

And we've made executive-led customer engagements a standard part of our go-to Market discipline.

Speaker #3: These three Rs guide how we're rebuilding growth, strengthening execution, and improving consistency across the organization. First, reach. Expanding the top of the funnel and increasing access to customers.

Anshul Thakral: These three Rs guide how we are rebuilding growth, strengthening execution, and improving consistency across the organization. First, reach, extending the top of the funnel and increasing access to customers.

Second relevance creating bespoke solutions that leverage our recognized therapeutic and scientific expertise in ways that are relevant and resonate with clients.

our clients have come to expect that for Tria leaves with science,

Speaker #3: Over the last several quarters, we've taken deliberate actions to broaden our aperture. We've restructured our global sales organization to increase capacity and capabilities focused on hunting new client relationships.

Anshul Thakral: Over the last several quarters, we've taken deliberate actions to broaden our aperture. We've restructured our global sales organization to increase capacity and capabilities focused on hunting new client relationships. We're building our inside sales, otherwise known as our reach engine, focused on early-stage qualification, new to Fortrea prospects, and general biotech outreach. We've made executive-led customer engagement a standard part of our go-to-market discipline. Second, relevance, creating bespoke solutions that leverage our recognized therapeutic and scientific expertise in ways that are relevant and resonate with clients. Our clients have come to expect that Fortrea leads with science. Now we are infusing our medical expertise deeper into how we deliver our clinical programs. As I mentioned earlier, Dr. Oren Cohen is now spending all of his time as Chief Medical Officer to deepen relationships with clients.

Now, we are infusing, our medical expertise deeper into how we deliver our clinical programs.

Speaker #3: We're building our inside sales otherwise known as our reach engine focused on early-stage qualification, new-to-Fortrea prospects, and general biotech outreach. And we've made executive-led customer engagement a standard part of our go-to-market discipline.

As I mentioned earlier, Dr. Orin Cohen. Is now spending all of his time as chief medical officer to deepen relationships with clients. He's engaging earlier in the scientific dialogue and collaborating closely with our physicians and therapeutic leaders to ensure portraits Solutions, address the complex development challenges, our clients face

We also have been sharpening our focus on biotech opportunities.

Speaker #3: Second, relevance. Creating bespoke solutions that leverage our recognized therapeutic and scientific expertise in ways that are relevant and resonate with clients. Our clients have come to expect that Fortrea leads with science.

On the flip side, we maintain strong discipline, including a willingness to walk away. If opportunities do not meet our strategic or margin criteria,

Third, repeat.

Speaker #3: Now, we are infusing our medical expertise deeper into how we deliver our clinical programs. As I mentioned earlier, Dr. Oren Cohen is now spending all of his time as Chief Medical Officer to deepen relationships with clients.

Earning the next study by delivering consistently, and creating long-term relationships.

Speaker #3: He's engaging earlier in the scientific dialogue and collaborating closely with our physicians and therapeutic leaders to ensure Fortrea's solutions address the complex development challenges our clients face.

Anshul Thakral: He's engaging earlier in the scientific dialogue and collaborating closely with our physicians and therapeutic leaders to ensure Fortrea's solutions address the complex development challenges our clients face. We also have been sharpening our focus on biotech opportunities, assembling biotech-ready teams that understand the unique constraints and needs of the biotech sector as they advance scientific innovation. On the flip side, we maintain strong discipline, including a willingness to walk away if opportunities do not meet our strategic or margin criteria. Third, repeat. Earning the next study by delivering consistently and creating long-term relationships. We've strengthened the interface between sales, delivery, and project management to ensure seamless handoffs, improved visibility, and streamlined client experience. This focus is showing up in execution, and our clients are noticing the difference. Our Net Promoter Score, which is how we track client satisfaction, improved year-over-year.

With the interface between sales delivery and project management to ensure seamless, handoffs improved visibility and streamlined client experience.

This focus is showing up in execution and our clients are noticing the difference.

Our net promoter score.

Which is how we track client satisfaction improved year-over-year.

Speaker #3: We also have been sharpening our focus on biotech opportunities, assembling biotech-ready teams that understand the unique constraints and needs of the biotech sector as they advance scientific innovation.

Now, let me share some progress. We've made under our operational excellence, alert,

As a provider of Professional Services.

Operational excellence is baked in how we manage projects.

Speaker #3: On the flip side, we maintain strong discipline including a willingness to walk away if opportunities do not meet our strategic or margin criteria. Third, repeat.

We continue to optimize our approach to project management with a Relentless focus on the client experience based on reliable and predictable delivery. Let me share some recent updates.

Speaker #3: Earning the next study by delivering consistently and creating long-term relationships. We've strengthened the interface between sales delivery and project management to ensure seamless handoffs, improved visibility, and streamlined client experience.

We've created a stronger alignment to evolving regulatory requirements with risk based quality management embedded as a Cornerstone of how we deliver quality and oversight across the development, life cycles.

Anshul Thakral: This focus is showing up in execution, and our clients are noticing the difference. Our Net Promoter Score, which is how we track client satisfaction, improved year-over-year.

Speaker #3: This focus is showing up in execution, and our clients are noticing the difference. Our net promoter score, which is how we track client satisfaction, improved year over year.

Notably we've streamlined, the design of our project management capabilities, reducing touch points for customers and creating more direct interaction with our therapeutic and scientific leads.

Speaker #3: Now, let me share some progress we've made under our operational excellence pillar. As a provider of professional services, operational excellence is baked in how we manage projects.

Anshul Thakral: Now, let me share some progress we've made under our operational excellence pillar. As a provider of professional services, operational excellence is baked in how we manage projects. We continue to optimize our approach to project management with a relentless focus on the client experience based on reliable and predictable delivery. Let me share some recent updates. We have created a stronger alignment to evolving regulatory requirements with risk-based quality management embedded as a cornerstone of how we deliver quality and oversight across the development life cycle. Notably, we've streamlined the design of our project management capabilities, reducing touch points for customers, and creating more direct interaction with our therapeutic and scientific leads. We have also streamlined our planning and global processes, removing repeat actions and simplifying workflows. These process changes are enabled by technology.

We have also streamlined our planning and Global processes removeing, repeat actions and simplifying workflows.

These process changes are enabled by technology.

Speaker #3: We continue to optimize our approach to project management with a relentless focus on the client experience based on reliable and predictable delivery. Let me share some recent updates.

Now, given technology underpins so much of operational excellence. Let me take a pause here from the quarterly updates and address the topic of technology more holistically.

Particularly, as it relates to AI in our industry.

Speaker #3: We have created a stronger alignment to evolving regulatory requirements, with risk-based quality management embedded as a cornerstone of how we deliver quality and oversight across the development lifecycle.

I'm very aware that there has been a great deal of discussion and frankly concerns raised in the recent weeks about how AI will impact the cro sector.

So here's how weird thinking about it.

Speaker #3: Notably, we've streamlined the design of our project management capabilities reducing touch points for customers and creating more direct interaction with our therapeutic and scientific leads.

Speaking, broadly, we see AI as a force multiplier that can accelerate execution and ultimately can drive more science, more trials, and more growth.

Speaker #3: We have also streamlined our planning and global processes removing repeat actions and simplifying workflows. These process changes are enabled by technology. Now, given technology underpins so much of operational excellence, let me take a pause here from the quarterly updates and address the topic of technology more holistically.

AI is a way to advance science faster, which ultimately expands demand for Crows rather than shrinking it.

Anshul Thakral: Now, given technology underpins so much of operational excellence, let me take a pause here from the quarterly updates and address the topic of technology more holistically, particularly as it relates to AI in our industry. I'm very aware that there has been a great deal of discussion, and frankly, concerns raised in the recent weeks about how AI will impact the CRO sector. Here's how we're thinking about it. Speaking broadly, we see AI as a force multiplier that can Xcellerate execution and ultimately can drive more science, more trials, and more growth. AI is a way to advance science faster, which ultimately expands demand for CROs rather than shrinking it. AI is a margin and productivity lever, not a people replacement or a cost cutter. AI will automate specific task-level work rather than replace core CRO roles.

AI is a margin and productivity level, not a people's replacement or a Cost Cutter.

AI will automate.

Task level work.

Rather than replace core Crescent roles.

Speaker #3: Particularly as it relates to AI in our industry. I'm very aware that there has been a great deal of discussion and, frankly, concerns raised in the recent weeks about how AI will impact the CRO sector.

It eliminates routine and repeatable work and improves, throughput and standards.

It is part of a broader push to compress trial, timelines and costs.

The hard boundary.

Quality is non-negotiable.

Speaker #3: So here's how we are thinking about it. Speaking broadly, we see AI as a force multiplier that can accelerate execution and ultimately can drive more science, more trials, and more growth.

Examples of AI can use across our industry today include case, intake and Reporting in pharmacovigilance central, monitoring documentation checks and alert triggers.

Site selection and study design optimization.

Speaker #3: AI is a way to advance science faster. Which ultimately expands demand for CROs rather than shrinking it. AI is a margin and productivity lever.

At for Tria more specifically, we are making focused investments in AI machine, learning and other Advanced Technologies and workflow Automation and orchestration to drive speed reduce costs and improve quality in clinical research.

Speaker #3: Not a people replacement or a cost cutter. AI will automate specific task-level work rather than replace core CRO roles. It eliminates routine and repeatable work and improves throughput and standards.

Our industry-leading accelerate platform, remains Central to that strategy.

Anshul Thakral: It eliminates routine and repeatable work and improves throughput and standards. It is part of a broader push to compress trial timelines and costs, but with a hard boundary. Quality is non-negotiable. Examples of AI in use across our industry today include case intake and reporting in pharmacovigilance, central monitoring, documentation checks and alert triggers, site selection, and study design optimization. At Fortrea, more specifically, we are making focused investments in AI, machine learning, and other advanced technologies, and workflow automation and orchestration to drive speed, reduce costs, and improve quality in clinical research. Our industry-leading Xcellerate platform remains central to that strategy. By integrating real-time, role-based insights across the trial ecosystem, we are able to reduce manual effort, Xcellerate decision-making, and improve quality at scale.

Speaker #3: It is part of a broader push to compress trial timelines and costs. But with a hard boundary. Quality is non-negotiable. Examples of AI in use across our industry today include case intake and reporting in pharmacovigilance, central monitoring documentation checks and alert triggers, site selection, and study design optimization.

By integrating real-time role-based insights across the trial, ecosystem. We are able to reduce manual effort, accelerate decision-making, and improve quality at scale.

You may recall last quarter, I reported that the AI enabled risk radar update to accelerate was in production and we are beginning to roll out the CRA mobile app, digital assistant, and our start, my day platform to increase CRA productivity.

We Advanced deployment of these tools in the fourth quarter and introduced further innovation.

Speaker #3: At Fortrea, more specifically, we are making focused investments in AI, machine learning, and other advanced technologies and workflow automation and orchestration to drive speed, reduce costs, and improve quality in clinical research.

Currently we're wrapping up a pilot of our new feasibility intelligence engine, which enables portrayal to partner with clients. At the beginning of a program to make better informed visibility decisions that improve, operational outcomes.

Speaker #3: Our industry-leading accelerate platform remains central to that strategy. By integrating real-time role-based insights across the trial ecosystem, we are able to reduce manual effort, accelerate decision-making, and improve quality at scale.

Line the experience for clients and investigator sites and improve the overall quality of clinical trials.

Speaker #3: You may recall last quarter I reported that the AI-enabled risk radar update to accelerate was in production. And we are beginning to roll out the CRA mobile app, digital assistant, and our Start My Day platform to increase CRA productivity.

Anshul Thakral: You may recall last quarter, I reported that the AI-enabled Risk Radar update to Xcellerate was in production, and we are beginning to roll out the CRA Mobile App, digital assistant, and our Start My Day platform to increase CRA productivity. We advanced deployment of these tools in the Q4 and introduced further innovation. Currently, we're wrapping up a pilot of our new feasibility intelligence engine, which enables Fortrea to partner with clients at the beginning of a program to make better-informed feasibility decisions that improve operational outcomes. With all of our investments in technology, we are ultimately driven to improve the efficiency of drug development, streamline the experience for clients and investigator sites, and improve the overall quality of clinical trials. From project management to streamlined processes to phased deployment of AI-enabled tools, we track our operational excellence progress in terms of outcomes.

From project management to streamline processes to phase deployment of AI enabled tools.

We track our operational excellence progress in terms of outcomes.

Are we delivering faster better or changing? The experience for our clients? That is the key question.

Speaker #3: We advanced deployment of these tools in the fourth quarter and introduced further innovation. Currently, we're wrapping up a pilot of our new feasibility intelligence engine.

For example, we recently accelerated recruitment by 3 months, in a complex, respiratory study and completed enrollment in a phase 2. Alzheimer study.

Speaker #3: Which enables Fortrea to partner with clients at the beginning of a program to make better informed feasibility decisions that improve operational outcomes. With all of our investments in technology, we are ultimately driven to improve the efficiency of drug development.

These achievements matter to our clients and make a meaningful difference to the patients who will eventually benefit from new treatments.

As a service-driven organization, our people are the foundation of operational excellence.

Speaker #3: Streamline the experience for clients and investigators' sites and improve the overall quality of clinical trials. From project management to streamlined processes to phased deployment of AI-enabled tools, we track our operational excellence progress in terms of outcomes.

Beyond adoption of new technology and processes. We prioritize Employee Engagement and development.

Anshul Thakral: From project management to streamlined processes to phased deployment of AI-enabled tools, we track our operational excellence progress in terms of outcomes.

I'm pleased to report that in our recent annual engagement survey, our overall score is improved year-over-year. Alongside a significant increase in response rate.

Scores increased across all categories with most exceeding cross-industry benchmarks.

Speaker #3: Are we delivering faster? Better? Or changing the experience for our clients? That is the key question. For example, we recently accelerated recruitment by three months in a complex respiratory study and completed enrollment in a phase two Alzheimer's study.

Anshul Thakral: Are we delivering faster, better, or changing the experience for our clients? That is the key question. For example, we recently accelerated recruitment by three months in a complex respiratory study and completed enrollment in a phase two Alzheimer's study. These achievements matter to our clients and make a meaningful difference to the patients who will eventually benefit from new treatments. As a service-driven organization, our people are the foundation of operational excellence. Beyond adoption of new technology and processes, we prioritize employee engagement and development. I'm pleased to report that in our recent annual engagement survey, our overall scores improved year-over-year, alongside a significant increase in response rate. Scores increased across all categories, with most exceeding cross-industry benchmarks. I said earlier that I'm proud of Fortrea's performance and recent progress, I'm even more proud of the impact our work has on patients.

I said earlier, that I am proud of Fortress performance in recent progress.

But I'm even more proud of the impact. Our work has on patients.

I continue to make time to meet with our team and clients in person around the world.

Speaker #3: These achievements matter to our clients and make a meaningful difference to the patients who will eventually benefit from new treatments. As a service-driven organization, our people are the foundation of operational excellence.

a few weeks ago, I had the pleasure of visiting, our Clinical Research Unit in Dallas Texas, just days after a significant winter storms, disrupted, the region,

While the weather created, disruptions our research did not stop.

Speaker #3: Beyond adoption of new technology and processes, we prioritize employee engagement and development. I'm pleased to report that in our recent annual engagement survey, our overall scores improved year over year.

Members of our teams stayed overnight to ensure study volunteers were cared for and that plan dosing continued on schedule during the visit. I met with our principal investigator and observed, an ethno, bridging study in progress.

Speaker #3: Alongside a significant increase in response rate, scores increased across all categories, with most exceeding cross-industry benchmarks. I said earlier that I'm proud of Fortrea's performance in recent progress.

Anshul Thakral: Scores increased across all categories, with most exceeding cross-industry benchmarks. I said earlier that I'm proud of Fortrea's performance and recent progress, I'm even more proud of the impact our work has on patients.

Demand for these studies is growing as the global regulatory environment evolves and our Global clinical network has earned a tremendous reputation for delivering this critical work.

Moments like this reinforced what sets for trade apart?

Speaker #3: But I'm even more proud of the impact our work has on patients. I continue to make time to meet with our team and clients in person around the world.

Anshul Thakral: I continue to make time to meet with our teams and clients in person around the world. A few weeks ago, I had the pleasure of visiting our clinical research unit in Dallas, Texas, just days after a significant winter storm disrupted the region. While the weather created disruptions, our research did not stop. Members of our team stayed overnight to ensure study volunteers were cared for and that planned dosing continued on schedule. During the visit, I met with our principal investigator and observed an ethno-bridging study in progress. Demand for these studies is growing as the global regulatory environment evolves, and our global clinical network has earned a tremendous reputation for delivering this critical work. Moments like this reinforce what sets Fortrea apart. The dedication of our physicians and clinical operations teams, united by our shared purpose of bringing new treatments to patients faster.

The dedication of our physicians and clinical operations teams, United by our shared purpose of bringing new treatments to patients faster.

Speaker #3: A few weeks ago, I had the pleasure of visiting our clinical research unit in Dallas, Texas. Just days after a significant winter storm disrupted the region.

Before I turned it over to Joe, let me close with a few key points.

For Tria is executing against a clear strategy and building momentum.

Speaker #3: While the weather created disruptions, our research did not stop. Members of our team stayed overnight to ensure study volunteers were cared for and that planned dosing continued on schedule.

This is a high-quality business with strong fundamentals now operating with greater discipline, focus and accountability.

Speaker #3: During the visit, I met with our principal investigator and observed an ethnobridging study in progress. Demand for these studies is growing as the global regulatory environment evolves.

We've taken meaningful steps to strengthen. Our commercial engine and improve our cost structure.

We are advancing operational excellence.

Anshul Thakral: Demand for these studies is growing as the global regulatory environment evolves, and our global clinical network has earned a tremendous reputation for delivering this critical work. Moments like this reinforce what sets Fortrea apart. The dedication of our physicians and clinical operations teams, united by our shared purpose of bringing new treatments to patients faster.

From streamlining project delivery to Transforming Our processes and tools.

Speaker #3: And our global clinical network has earned a tremendous reputation for delivering this critical work. Moments like this reinforce what sets Fortrea apart: the dedication of our physicians and clinical operations teams, united by our shared purpose of bringing new treatments to patients faster.

And we're innovating in ways that are meaningful to clients.

These actions position us well to benefit from an improving Market.

While this remains a journey, the direction is clear.

Speaker #3: Before I turn it over to Jill, let me close with a few key points. Fortrea is executing against a clear strategy and building momentum.

Anshul Thakral: Before I turn it over to Jill, let me close with a few key points. Fortrea is executing against a clear strategy and building momentum. This is a high-quality business with strong fundamentals, now operating with greater discipline, focus, and accountability. We've taken meaningful steps to strengthen our commercial engine and improve our cost structure. We are advancing operational excellence, from streamlining project delivery to transforming our processes and tools, and we're innovating in ways that are meaningful to clients. These actions position us well to benefit from an improving market. While this remains a journey, the direction is clear. Early proof points are in place, and we are confident in our ability to deliver consistent, long-term value creation. With that, I'll turn the call over to Jill.

Early proof points are in place and we are confident in our ability to deliver consistent long-term value creation.

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

Thank you, anel, and thank you to everyone for joining us today.

Speaker #3: This is a high-quality business with strong fundamentals, now operating with greater discipline focus and accountability. We've taken meaningful steps to strengthen our commercial engine and improve our cost structure.

Let me start by thanking the entire for trio Organization for our solid performance in 2025.

We navigated another year of significant change and as always the grit and resilience of this team persevered.

Speaker #3: We are advancing operational excellence from streamlining project delivery to transforming our processes and tools. And we're innovating in ways that are meaningful to clients.

Speaker #3: These actions position us well to benefit from an improving market. While this remains a journey, the direction is clear. Early proof points are in place.

In my prepared remarks. I'll cover the primary factors that influence our fourth quarter performance, including progress against our previously. Shared cost optimization initiatives, improvements in cash flow and our expectations regarding liquidity and capital structure. I will also provide our Outlook and 2026 guidance.

As on show stated, we delivered a solid fourth quarter and full year 2025.

Speaker #3: And we are confident in our ability to deliver consistent, long-term value creation. With that, I'll turn the call over to Jill.

I am very proud of what the team achieved, particularly our ability to execute and deliver results in line with our guidance.

Speaker #2: Thank you, Anshul. And thank you to everyone for joining us today. Let me start by thanking the entire Fortrea organization for our solid performance in 2025.

Jill McConnell: Thank you, Anshul. Thank you to everyone for joining us today. Let me start by thanking the entire Fortrea organization for our solid performance in 2025. We navigated another year of significant change, and as always, the grit and resilience of this team persevered. In my prepared remarks, I'll cover the primary factors that influenced our Q4 performance, including progress against our previously shared cost optimization initiatives, improvements in cash flow, and our expectations regarding liquidity and capital structure. I will also provide our outlook in 2026 guidance. As Anshul stated, we delivered a solid Q4 and full year 2025. I am very proud of what the team achieved, particularly our ability to execute and deliver results in line with our guidance. Before getting into the details, I'd like to highlight our progress towards financial excellence, the third pillar of our growth strategy.

Before getting into the details, I'd like to highlight our progress towards Financial excellence.

The third pillar of our growth strategy.

Speaker #2: We navigated another year of significant change and, as always, the grit and resilience of this team persevered. In my prepared remarks, I'll cover the primary factors that influenced our fourth-quarter performance, including progress against our previously shared cost optimization initiatives, improvements in cash flow, and our expectations regarding liquidity and capital structure.

First. As part of our right sizing initiative, we delivered full year cost savings was 153 million growth and 93 million net exceeding. Our original Target

With another significant Improvement in DSO and the fourth quarter reflecting continued improvements in our order to Cash Processing.

Speaker #2: I will also provide our outlook in 2026 guidance. As Anshul stated, we delivered a solid fourth quarter and full year 2025. I am very proud of what the team achieved, particularly our ability to execute and deliver results in line with our guidance.

Jill McConnell: As Anshul stated, we delivered a solid Q4 and full year 2025. I am very proud of what the team achieved, particularly our ability to execute and deliver results in line with our guidance. Before getting into the details, I'd like to highlight our progress towards financial excellence, the third pillar of our growth strategy.

Finally demonstrating our continued commitment to financial discipline, and balance sheet strength. We paid down approximately 76 million of our senior secured notes in the fourth quarter using cash on hand.

Now, I'll cover the financial results in more detail.

Speaker #2: Before getting into the details, I'd like to highlight our progress towards financial excellence, the third pillar of our growth strategy. First, as part of our right-sizing initiative, we delivered full-year cost savings of $153 million gross and $93 million net exceeding our original target.

Fourth quarter Revenue was 660.5 Million 5.2% lower than the prior year quarter.

Jill McConnell: As part of our right-sizing initiative, we delivered full-year cost savings was $153 million gross and $93 million net, exceeding our original target. We generated positive full-year operating and free cash flow, with another significant improvement in DSO in Q4, reflecting continued improvement in our order to cash processes. Demonstrating our continued commitment to financial discipline and balance sheet strength, we paid down approximately $76 million of our senior secured notes in Q4 using cash on hand. I'll cover the financial results in more detail. Q4 revenue was $660.5 million, 5.2% lower than the prior year quarter. The decline was driven primarily by lower pass-through costs in both our clinical pharmacology and clinical development businesses, as well as continued FSP headwinds.

The decline was driven primarily by lower pass through costs than both our clinical pharmacology and clinical development businesses as well as continued. Fsp headwinds.

The decline in pass through costs was driven by study mix.

Speaker #2: Second, we generated positive full-year operating and free cash flow with another significant improvement in DSO in the fourth quarter, reflecting continued improvements in our order-to-cash processes.

Full year 2025 revenue of 2,723.4 million in line with our guidance range increased 1% year-on-year.

Speaker #2: Finally, demonstrating our continued commitment to financial discipline and balance sheet strength, we paid down approximately $76 million of our senior secured notes in the fourth quarter using cash on hand.

In the increase was driven primarily by higher Revenue in our clinical pharmacology business, partially offset by lower fsp Revenue.

On a gap basis. Direct cost in the quarter, decreased 4.8% year-over-year, primarily due to lower headcount, and Personnel costs,

Speaker #2: Now I'll cover the financial results in more detail. Fourth quarter revenue was $660.5 million, 5.2% lower than the prior year quarter. The decline was driven primarily by lower pass-through costs in both our clinical pharmacology and clinical development businesses, as well as continued FSP headwinds.

These reductions were achieved despite the planned reintroduction of variable compensation. As we remain focused on rewarding our talent while maintaining cost discipline.

Sgna in the quarter. Decreased 30.5% year-over-year driven primarily by lower TSA and it related costs.

Speaker #2: The decline in pass-through costs was driven by study mix. Full-year 2025 revenue of $2,723.4 million in line with our guidance range increased 1% year on year.

Looking at underlying controllable sgna on a sequential basis.

Jill McConnell: The decline in pass-through costs was driven by study mix. Full year 2025 revenue of $2,723.4 million, in line with our guidance range, increased 1% year-over-year. The increase was driven primarily by higher revenue in our clinical pharmacology business, partially offset by lower FSP revenue. On a GAAP basis, direct costs in the quarter decreased 4.8% year-over-year, primarily due to lower headcount and personnel costs. These reductions were achieved despite the planned reintroduction of variable compensation, as we remain focused on rewarding our talent while maintaining cost discipline. SG&A in the quarter decreased 30.5% year-over-year, driven primarily by lower TSA and IT-related costs.

Speaker #2: The increase was driven primarily by higher revenue in our clinical pharmacology business, partially offset by lower FSP revenue. On a gap basis, direct costs in the quarter decreased 4.8% year over year, primarily due to lower headcount and personnel costs.

Fourth quarter sgna was 4.8% lower than the third quarter of 2025, and 23% lower than our fourth quarter 2024 run rate. As a result of execution of our sgna specific cost optimization initiative.

These results. Also include the impact of reintroducing variable compensation. I'll discuss progress on our ongoing transformation efforts across the organization later in my remarks.

Net interest expense for the quarter was 23.2 million.

Speaker #2: These reductions were achieved despite the planned reintroduction of variable compensation as we remain focused on rewarding our talent while maintaining cost discipline. SG&A in the quarter decreased 30.5% year over year, driven primarily by lower TSA and IT-related costs.

Broadly in line with the prior year quarter.

For the full year, we recorded an income tax charge of 3.2 million resulting in an effective tax rate of negative -.3.

The annual rate differed from our statutory rate primarily due to the non-deductible Goodwill impairment.

Speaker #2: Looking at underlying controllable SG&A on a sequential basis, fourth quarter SG&A was 4.8% lower than the third quarter of 2025 and 23% lower than our fourth quarter 2024 run rate, as a result of execution of our SG&A-specific cost optimization initiative.

Jill McConnell: Looking at underlying controllable SG&A on a sequential basis, Q4 SG&A was 4.8% lower than Q3 2025, and 23% lower than our Q4 2024 run rate as a result of execution of our SG&A-specific cost optimization initiative. These results also include the impact of reintroducing variable compensation. I'll discuss progress on our ongoing transformation efforts across the organization later in my remarks. Net interest expense for Q4 was $23.2 million, broadly in line with the prior year Q4. For the full year, we recorded an income tax charge of $3.2 million, resulting in an effective tax rate of -0.3%. The annual rate differed from our statutory rate, primarily due to the nondeductible goodwill impairment.

Our book to bill for the quarter was 1.14 times broadly in line with the third quarter.

Hope to bill for the trailing 12 months. Was 1.02 times.

Backlog was 7.7 billion and cancellations remained in line with historical trends.

Speaker #2: These results also include the impact of reintroducing variable compensation. I'll discuss progress on our ongoing transformation efforts across the organization later in my remarks.

Adjusted evaa for the quarter was 54 million compared to 56 million in the prior year period.

Speaker #2: Net interest expense for the quarter was $23.2 million, broadly in line with the prior year quarter. For the full year, we recorded an income tax charge of 3.2 million dollars, resulting in an effective tax rate of negative 0.3%.

The decline versus the prior year quarter was driven primarily by the reintroduction of variable compensation, partially offset by the benefits of our cost-savings initiatives.

Adjusted. Evida for the full year, was 189.9 Million towards the higher end of our guidance range.

The decline versus the prior year was primarily the result of lower fxp Revenue.

Speaker #2: The annual rate differed from our statutory rate, primarily due to the non-deductible goodwill impairment. Our book-to-bill for the quarter was $1.14 times, broadly in line with the third quarter.

Clinical pharmacology, mix.

Jill McConnell: Our book-to-bill for the quarter was 1.14x, broadly in line with Q3. Book-to-bill for the trailing 12 months was 1.02x. Backlog was $7.7 billion, and cancellations remained in line with historical trends. Adjusted EBITDA for the quarter was $54 million, compared to $56 million in the prior year period. The decline versus the prior year quarter was driven primarily by the reintroduction of variable compensation, partially offset by the benefits of our cost savings initiatives. Adjusted EBITDA for the full year was $189.9 million, towards the higher end of our guidance range. The decline versus the prior year was primarily the result of lower FSP revenue, clinical pharmacology mix, the reintroduction of variable compensation, as well as the negative impact of lower research and development tax credits.

The reintroduction of variable compensation, as well as the negative impact of lower research and development tax credits.

These impacts were largely offset by the benefits of our cost savings initiative.

Speaker #2: Book-to-bill for the trailing 12 months was $1.02 times. Backlog was $7.7 billion, and cancellations remained in line with historical trends. Adjusted EBITDA for the quarter was $54 million, compared to $56 million in the prior year period.

Moving to net loss and adjusted net income.

In the fourth quarter of 2025 net loss was 32.5 million compared to a net loss of 73.9 million in the prior year period.

Speaker #2: The decline versus the prior year quarter was driven primarily by the reintroduction of variable compensation partially offset by the benefits of our cost savings initiative.

Adjusted net income. For the quarter was 9.2 million compared to 16.6 million in the prior year period.

Adjusted basic and diluted earnings per share for the quarter for 10 cents and 9 cents respectively.

Speaker #2: Adjusted EBITDA for the full year was $189.9 million, towards the higher end of our guidance range. The decline versus the prior year was primarily the result of lower FSP revenue, clinical pharmacology mix, the reintroduction of variable compensation, as well as the negative impact of lower research and development tax credits.

Turning to customer concentration.

Our top 10 customers represented 56.8% of revenue for the year. Ended December 31st 2025 our largest customer accounted for 18.1% of 2025 Revenue.

Speaker #2: These impacts were largely offset by the benefits of our cost savings initiative. Moving to net loss and adjusted net income. In the fourth quarter of 2025, net loss was $32.5 million, compared to a net loss of $73.9 million, in the prior year period.

Jill McConnell: These impacts were largely offset by the benefits of our cost savings initiatives. Moving to net loss and adjusted net income. In Q4 2025, net loss was $32.5 million, compared to a net loss of $73.9 million in the prior year period. Adjusted net income for the quarter was $9.2 million, compared to $16.6 million in the prior year period. Adjusted basic and diluted earnings per share for the quarter were $0.10 and $0.09, respectively. Turning to customer concentration. Our top 10 customers represented 56.8% of revenue for the year ended 31 December 2025. Our largest customer accounted for 18.1% of 2025 revenue.

As I comment on cash flows, please note that all references to Prior year cash flows are for the entirety of portra. As we had not segregated cash flows from discontinued operations for the businesses sold in June 2024

to more clearly see full year and fourth quarter cash flow metrics. Please refer to the investor presentation close to our website this morning.

Speaker #2: Adjusted net income for the quarter was $9.2 million, compared to $16.6 million in the prior year period. Adjusted basic and diluted earnings per share for the quarter were $0.10 and $0.09, respectively.

With particularly strong, enabling us to deliver positive operating, cash flow and free cash flow for both the quarter and full year.

Speaker #2: Turning to customer concentration. Our top 10 customers represented 56.8% of revenue for the year ended December 31, 2025. Our largest customer accounted for 18.1% of 2025 revenue.

In the fourth quarter, we generated positive operating cash flow of 129.1 million and free cash flow of 121.6 million, both of which exceeded our expectations.

For the year. Ended December 31st 2025 operating. Cash flow was 113.5 million.

Speaker #2: As I comment on cash flows, please note that all references to prior year cash flows are for the entirety of Fortrea, as we had not segregated cash flows from discontinued operations for the businesses sold in June 2024.

Jill McConnell: As I comment on cash flows, please note that all references to prior year cash flows are for the entirety of Fortrea, as we had not segregated cash flows from discontinued operations for the businesses sold in June 2024. To more clearly see full year and Q4 cash flow metrics, please refer to the investor presentation posted to our website this morning. Our cash generation in Q4 was particularly strong, enabling us to deliver positive operating cash flow and free cash flow for both the Q4 and full year. In Q4, we generated positive operating cash flow of $129.1 million and free cash flow of $121.6 million, both of which exceeded our expectations.

Compared to 262.8 million in the prior year period.

And free cash flow was 88.3 million compared to 237.3 million in 2024.

Speaker #2: To more clearly see full-year and fourth quarter cash flow metrics, please refer to the investor presentation posted to our website this morning. Our cash generation in the fourth quarter was particularly strong, enabling us to deliver positive operating cash flow and free cash flow for both the quarter and full year.

Recall that 2024 benefited from the net proceeds of 297.9 million upon the initiation of our million dollar securitization program.

Speaker #2: In the fourth quarter, we generated positive operating cash flow of $129.1 million and free cash flow of $121.6 million, both of which exceeded our expectations.

On a comparable basis, excluding the impact of the securitization operating cash flow. Improved year-over-year by 148.6 million and free cash flow. Improved by 148.9 million reflecting, meaningful underlying Improvement in cash, generation in 2025.

Speaker #2: For the year ended December 31, 2025, operating cash flow was $113.5 million, compared to $262.8 million in the prior year period. And free cash flow was $88.3 million, compared to $237.3 million in 2024.

Jill McConnell: For the year ended 31 December 2025, operating cash flow was $113.5 million, compared to $262.8 million in the prior year period, and free cash flow was $88.3 million, compared to $237.3 million in 2024. Recall that 2024 benefited from the net proceeds of $297.9 million upon the initiation of our $300 million securitization program. On a comparable basis, excluding the impact of the securitization, operating cash flow improved year-over-year by $148.6 million, and free cash flow improved by $148.9 million, reflecting meaningful underlying improvement in cash generation in 2025.

Cash flow performance for both the quarter. And the year was driven by a significant Improvement in Day sales outstanding.

DSO was 16 days at year, end improving by 17 days sequentially and 24 days. Year-over-year reflecting continued enhancements in our order to cash processes.

We also benefited from favorable payment timing during the fourth quarter.

Speaker #2: Recall that 2024 benefited from the net proceeds of $297.9 million upon the initiation of our $300 million securitization program. On a comparable basis, excluding the impact of the securitization, operating cash flow improved year over year by $148.6 million, and free cash flow improved by $148.9 million, reflecting meaningful underlying improvement in cash generation in 2025.

Net accounts receivable and unbuild services for continuing operations were 50089.7 million of December 31st 2025 compared to 659.5% 2024.

This reduction is primarily driven by the improved cash collections during 2025.

We ended the quarter with no borrowing on the revolver. Consistent with a third quarter.

Speaker #2: Cash flow performance for both the quarter and the year was driven by a significant improvement in day sales outstanding. CSO was 16 days at year-end, improving by 17 days sequentially, and 24 days year over year.

Jill McConnell: Cash flow performance for both the quarter and the year was driven by a significant improvement in days sales outstanding. DSO was 16 days at year-end, improving by 17 days sequentially and 24 days year-over-year, reflecting continued enhancements in our order to cash processes. We also benefited from favorable payment timing during Q4. Net accounts receivable and unbilled services for continuing operations were $589.7 million of 31 December 2025, compared to $659.5 million as of 31 December 2024. This reduction is primarily driven by the improved cash collections during 2025. We ended the quarter with no borrowing on the revolver, consistent with Q3.

Our positive operating cash flow in the quarter. Combined with our undrawn revolver, throughout the quarter resulted in available liquidity, in excess of 600 million,

Looking ahead. We are currently targeting full year 2026, operating cash flow to be positive.

Speaker #2: Reflecting continued enhancement in our order-to-cash processing. We also benefited from favorable payment timing during the fourth quarter. Net accounts receivable and unbilled services for continuing operations were $589.7 million, of December 31, 2025, compared to $659.5 million, as of December 31, 2024.

We anticipate first quarter cash flow to be negative, primarily driven by variable, compensation payouts, and a partial reversal of some timing related DSO benefits.

We are targeting first. Quarter, use of cash to be more than offset by positive cash flow generation over the remainder of the year.

Speaker #2: This reduction is primarily driven by the improved cash collections during 2025. We ended the quarter with no borrowing on the revolver, consistent with the third quarter.

With our targeted IBA and significant, add backs available under our credit agreement. We expect to maintain ample liquidity and significant flexibility under our financial covenants for the foreseeable future.

Speaker #2: Our positive operating cash flow in the quarter combined with our undrawn revolver throughout the quarter resulted in available liquidity in excess of $600 million.

Jill McConnell: Our positive operating cash flow in the quarter, combined with our undrawn revolver throughout the quarter, resulted in available liquidity in excess of $600 million. Looking ahead, we are currently targeting full year 2026 operating cash flow to be positive. We anticipate Q1 cash flow to be negative, primarily driven by variable compensation payouts and a partial reversal of some timing-related DSO benefits. We are targeting Q1 use of cash to be more than offset by positive cash flow generation over the remainder of the year. With our targeted EBITDA and significant add backs available under our credit agreement, we expect to maintain ample liquidity and significant flexibility under our financial covenants for the foreseeable future.

Our Capital allocation priorities continue to focus on driving organic growth and improving productivity. Alongside debt repayment the latter of which was evidenced by the 75.7% of our senior notes at Carr during the fourth quarter of 2025.

Speaker #2: Looking ahead, we are currently targeting full-year 2026 operating cash flow to be positive. We anticipate first quarter cash flow to be negative, primarily driven by variable compensation payouts and a partial reversal of some timing-related DSO benefits.

Since the spin, we have paid down approximately 35% of our original debt.

This is strengthened our balance sheet and improved our Capital position underscoring, our disciplined approach to financial management.

Speaker #2: We are targeting first quarter use of cash to be more than offset by positive cash flow generation over the remainder of the year. With our targeted EBITDA and significant add-backs available under our credit agreement, we expect to maintain ample liquidity and significant flexibility under our financial covenants for the foreseeable future.

Backlog burn rate of 8.6% in the fourth quarter was lower than in Prior quarters, due primarily to lower pass through costs?

Now, I'll give an update on execution against our cost reduction plan.

I am pleased that we exceeded our annual targets for both growth and net cost reductions in 2025 with the difference between growth and net savings being reinvestments back into our people.

Speaker #2: Our capital allocation priorities continue to focus on driving organic growth and improving productivity, alongside debt repayment. The latter of which was evidenced by the $75.7 million repurchase of our senior notes at par during the fourth quarter of 2025.

Jill McConnell: Our capital allocation priorities continue to focus on driving organic growth and improving productivity alongside debt repayment, the latter of which was evidenced by the $75.7 million repurchase of our senior notes at par during Q4 2025. Since the spin, we have paid down approximately 35% of our original debt. This has strengthened our balance sheet and improved our capital position, underscoring our disciplined approach to financial management. Backlog burn rates of 8.6% in Q4 was lower than in prior quarters, due primarily to lower pass-through costs. Now I'll give an update on execution against our cost reduction plans. I am pleased that I exceeded our annual targets for both growth and net cost reductions in 2025, with the difference between growth and net savings being reinvestments back into our people.

Consistent with the timing and expectations. We communicated last quarter.

The fourth quarter was a strong period of execution, particularly across our sgna specific Savings Program.

Turning to our transformation plan for 2026 and Beyond.

Speaker #2: Since the spin, we have paid down approximately $35% of our original debt. This has strengthened our balance sheet and improved our capital position, underscoring our disciplined approach to financial management.

We believe the primary lever to our margin transformation is sustainable Revenue growth, which is why we are laser focused on strengthening our commercial engine.

The second half of 2025 was a step in the right direction.

Speaker #2: Backlog burn rate of 8.6% in the fourth quarter was lower than in prior quarters due primarily to lower pass-through costs. Now I'll give an update on execution against our cost reduction plans.

We've made several changes that support more stable books, to build performance, including strengthening commercial, leadership, improving opportunity qualification

Speaker #2: I am pleased that we exceeded our annual targets for both growth and net cost reductions in 2025, with the difference between growth and net savings being reinvestments back into our people.

Simplifying The Proposal generation process and engaging the entire leadership team in building and reinforcing customer relationships.

Speaker #2: Consistent with the timing and expectations we communicated last quarter, the fourth quarter was a strong period of execution, particularly across our SG&A-specific savings program.

Jill McConnell: Consistent with the timing and expectations we communicated last quarter, the Q4 was a strong period of execution, particularly across our SG&A specific savings program. Turning to our transformation plans for 2026 and beyond, we believe the primary lever to our margin transformation is sustainable revenue growth, which is why we are laser-focused on strengthening our commercial engine. The second half of 2025 was a step in the right direction. We've made several changes that support more stable book-to-bill performance, including strengthening commercial leadership, improving opportunity qualification, simplifying the proposal generation process, and engaging the entire leadership team in building and reinforcing customer relationships. As our commercial engine matures and the market environment continues to normalize, we anticipate that these changes could enable more stable book-to-bill performance over time.

With our attractive 50-50 splits between large Pharma and biotech customers. We believe we are well, positioned to capitalize on demand across our end markets.

Speaker #2: Turning to our transformation plans for 2026 and beyond, we believe the primary lever to our margin transformation is sustainable revenue growth, which is why we are laser-focused on strengthening our commercial engine.

Margin Improvement. Remains a multi-year journey.

Supported by 2 primary building blocks.

The first is revenue growth as I mentioned earlier.

Speaker #2: The second half of 2025 was a step in the right direction. We've made several changes that support more stable book-to-bill performance, including strengthening commercial leadership, improving opportunity qualification, simplifying the proposal generation process, and engaging the entire leadership team in building and reinforcing customer relationships.

The second is continued structural cost action, including ongoing right sizing of the organization and improvements in efficiency. All while maintaining our commitment to Quality delivery.

As the elements of Revenue growth and continued cost optimization. Come together, we are targeting an achievable path back to adjusted ibida margins more in line with peers over time

Turning now to 2026 guidance.

Speaker #2: As our commercial engine matures, and the market environment continues to normalize, we anticipate that these changes could enable more stable book-to-bill performance over time.

Speaker #2: With our attractive 50/50 split between large pharma and biotech customers, we believe we are well positioned to capitalize on demand across our end markets.

Jill McConnell: With our attractive 50/50 split between large pharma and biotech customers, we believe we are well positioned to capitalize on demand across our end markets. Margin improvement remains a multi-year journey, supported by two primary building blocks. The first is revenue growth, as I mentioned earlier. The second is continued structural cost actions, including ongoing right-sizing of the organization and improvements in efficiency, all while maintaining our commitment to quality delivery. As the elements of revenue growth and continued cost optimization come together, we are targeting an achievable path back to adjusted EBITDA margins more in line with peers over time. Turning now to 2026 guidance.

Using exchange rates in effect on December 31st 2025, we are targeting Revenue in the range of 2.55 billion to 2.65 billion.

And adjusted ibida in the range of 190 million to 220 million.

Speaker #2: Margin improvement remains a multi-year journey, supported by two primary building blocks. The first is revenue growth, as I mentioned earlier. The second is continued structural cost action, including ongoing right-sizing of the organization and improvements in efficiency, all while maintaining our commitment to quality delivery.

The year-over-year anticipated decline in Revenue, primarily reflects the impact of software bookings in the first half of 2025.

Continued FSB, headwinds an anticipation of reductions in pass, through costs.

The targeted improvements in adjusted ibida are driven by our continued efforts to right-size the business.

And improve our efficiency and Agility.

Speaker #2: As the elements of revenue growth and continued cost optimization come together, we are targeting an achievable path back to adjusted EBITDA margins more in line with peers over time.

We will continue our cost savings programs in 2026.

Speaker #2: Turning now to 2026 guidance. Using exchange rates in effect on December 31, 2025, we are targeting revenue in the range of 2.55 billion dollars to 2.65 billion dollars.

Jill McConnell: Using exchange rates in effect on 31 December 2025, we are targeting revenue in the range of $2.55 billion to $2.65 billion, and adjusted EBITDA in the range of $190 million to $220 million. The year-over-year anticipated decline in revenue primarily reflects the impact of softer bookings in the first half of 2025, continued FSD headwinds, and anticipation of reductions in pass-through costs. The targeted improvements in adjusted EBITDA are driven by our continued efforts to rightsize the business and improve our efficiency and agility. We will continue our cost savings programs in 2026, targeting incremental cost reductions of approximately $70 to $80 million in gross savings and $40 to $50 million in net savings as we move closer to normalized compensation levels by the end of 2026.

Targeting incremental cost reductions of approximately 70 to 80 million dollars in growth savings and 40 to 50 million dollars in net savings, as we move closer to normalized compensation Levels, by the end of 2026.

Speaker #2: And adjusted EBITDA in the range of 190 million dollars to 220 million dollars. The year-over-year anticipated decline in revenue primarily reflects the impact of software booking in the first half of 2025, continued FSP headwinds, and anticipation of reductions in pass-through costs.

In terms of quarterly progression, the first quarter has historically, demonstrated a step sequential reductions as billable hours can be impacted by the timing of holidays and certain expenses increase at the start of the year.

We anticipate a similar pattern this year.

From a margin perspective, we expect gradual Improvement as the year progresses and anticipate exiting 2026 on stronger. Footing.

Speaker #2: The targeted improvements in adjusted EBITDA are driven by our continued efforts to right-size the business and improve our efficiency and agility. We will continue our cost savings programs in 2026, targeting incremental cost reductions of approximately 70 to 80 million dollars in gross savings and 40 to 50 million dollars in net savings, as we move closer to normalized compensation levels by the end of 2026.

The team, I portray has demonstrated remarkable, focus and resilience and we welcome the opportunity to have our full engagement centered on our customers, our employees, and our shareholders.

We will continue on our transformation Journey sharpening. Our execution against the 3 pillars, previously described.

Do it all our employees remain engaged and committed to Quality delivery. Our customers signal that, their experiences with for Tria grow stronger, and our investors understand that we are putting the right building blocks in place to improve our financial performance over time.

Speaker #2: In terms of quarterly progression, the first quarter has historically demonstrated a step-sequential reduction, as billable hours can be impacted by the timing of holidays, and certain expenses increase at the start of the year.

Jill McConnell: In terms of quarterly progression, Q1 has historically demonstrated a step sequential reduction, as billable hours can be impacted by the timing of holidays and certain expenses increase at the start of the year. We anticipate a similar pattern this year. From a margin perspective, we expect gradual improvement as the year progresses and anticipate exiting 2026 on stronger footing. The team at Fortrea has demonstrated remarkable focus and resilience, we welcome the opportunity to have our full engagement centered on our customers, our employees, and our shareholders. We will continue on our transformation journey, sharpening our execution against the three pillars previously described.

We are confident in the direction we are taking and are excited about the future of fortra.

Now we'll open the call for Q&A.

Operator, please open the line.

Speaker #2: We anticipate a similar pattern this year. From a margin perspective, we expect gradual improvement as the year progresses, and anticipate exiting 2026 on stronger footing.

Speaker #2: The team at Fortrea has demonstrated remarkable focus and resilience, and we welcome the opportunity to have our full engagement centered on our customers, our employees, and our shareholders.

Thank you. At this time. We will conduct the question and answer session. As a reminder, to ask a question, you will need to press star 1 1 on your telephone and wait for your name to be announced to withdraw your question. Please press star 1 1 again, we ask that you keep to asking 1 question and then req for any follow-up to ensure that each analyst gets time.

Stand by for our while, we compile the Q&A list.

Speaker #2: We will continue on our transformation journey sharpening our execution against the three pillars previously described. Through it all, our employees remain engaged and committed to quality delivery, our customers signal that they're experiences with Fortrea grow stronger, and our investors understand that we are putting the right building blocks in place to improve our financial performance over time.

Jill McConnell: Through it all, our employees remain engaged and committed to quality delivery, our customers signal that their experiences with Fortrea grow stronger, and our investors understand that we are putting the right building blocks in place to improve our financial performance over time. We are confident in the direction we are taking and are excited about the future of Fortrea. Now we'll open the call for Q&A. Operator, please open the line.

Our first question comes from the line of Patrick Donnelly with City. Go ahead, your line is open.

Speaker #2: We are confident in the direction we are taking and are excited about the future of Fortrea. Now we'll open the call for Q&A. Operator, please open the line.

Speaker #1: Thank you. At this time, we will conduct the question-and-answer session. As a reminder, to ask a question, you will need to press star 11 on your telephone, and wait for your name to be announced.

Operator: Thank you. At this time, we will conduct a question-and-answer session. As a reminder, to ask a question, you will need to 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. We ask that you keep to asking one question and then re-queue for any follow-up to ensure that each analyst gets time. Stand by while we compile the Q&A list. Our first question comes from the line of Patrick Donnelly with Citi. Go ahead, your line is open.

Hey guys, thank you for taking the questions. Um, on show you sound cautiously optimistic on the overall backdrop, particularly on the biotech side, you know, it does seem like the market has firmed up, you talked about the funding piece, obviously, can you just talk through the Outlook a bit, you mentioned the uneven first half, is that more just to comment on the past, bookings rolling through but feeling better about the position on new bookings, front going forward, you know just giving your conversations with customers are you seeing any changes on the share front would love you to talk through a little bit?

On the overall backdrop here, for bookings, going forward.

Speaker #1: To withdraw your question, please press star 11 again. We ask that you keep to asking one question and then re-queue for any follow-up to ensure that each analyst gets time.

Speaker #1: Stand by for our while we compile the Q&A list. Our first question comes from the line of Patrick Donnelly with Citi. Go ahead. Your line is open.

Speaker #3: Hey, guys. Thank you for taking the questions. Anshul, you sound cautiously optimistic on the overall backdrop, particularly on the biotech side. It does seem like the market has firmed up.

Patrick Donnelly: Hey, guys. Thank you for taking the questions. Anshul, you sound cautiously optimistic on the overall backdrop, particularly on the biotech side. You know, it does seem like the market has firmed up. You talked about the funding piece, obviously. Can you just talk through the outlook a bit? You mentioned the uneven first half. Is that more just a comment on the past bookings rolling through, but feeling better about the position on new bookings front going forward? You know, just given your conversations with customers, are you seeing any changes on the share front? Would love you to talk through a little bit on the overall backdrop here for bookings going forward.

Speaker #3: You talked about the funding piece, obviously. Can you just talk through the outlook a bit? You mentioned the uneven first half. Is that more just a comment on the past bookings rolling through but feeling better about the position on new bookings front going forward?

Speaker #3: Just given your conversations with customers, are you seeing any changes on the share front? Would love you to talk through a little bit on the overall backdrop here for bookings going forward.

Speaker #4: Sure, Patrick. I'm happy to. Thanks for that question. And look, let me take the second part of your question first here. The comment around recovery in the first half, that is a comment around the 2025 first half bookings, and how that reflects in revenues.

Anshul Thakral: Sure, Patrick, I'm happy to. Thanks for that question. Let me take the second part of your question first here. The comment around recovery in the first half, that is a comment around the 2025 first half bookings and how that reflects in revenues. The words I use are cautiously optimistic, because I do think the environment is improving. We see signs of improvement, we see signs of stabilization, we see signs of early recovery. Let me give you some evidence. Our engagement level with clients is significantly higher than it was in the first half of 2025. We think the decision-making timeline has come back to a more of a normal pace that we would expect within the industry. Our conversations with customers have become a lot more constructive, both big pharma and little pharma.

Speaker #4: But what I the words I use are cautiously optimistic because I do think the environment is improving. We see signs of improvement. We see signs of stabilization.

Speaker #4: We see signs of early recovery. Let me give you some evidence. Our engagement level with clients is significantly higher than it was in the first half of 2025.

Uh, a lot of the, uh, chart around pipeline prior rep prioritization. Um, all of that sort of subsided as, as things matured in 2324 and we moved on to having very constructive dialogues about the 2026 pipeline. In, in our world of Biotech, we're seeing a shorter timeline in terms of decision-making. We're also seeing an increase in RFP flow coming now from our biotech customers. So, all of these things you know, added together, I use the word cautiously optimistic because um we've had um we've had some of this momentum here in the back half of 26. 25 EXC me. I'd like to see some more of that momentum before I drop the with cautious in front of my statement.

Speaker #4: We think the decision-making timelines have come back to a more of a normal pace that we would expect within the industry. Our conversations with customers have become a lot more constructive, both big pharma and little pharma.

Speaker #4: So in the world of large pharma, what we're seeing is a lot of the churn around pipeline reprioritization, all of that sort of subsided as things matured in Q3, Q4, and we moved on to having very constructive dialogues about the 2026 pipeline.

Anshul Thakral: In the world of large pharma, what we're seeing is a lot of the churn around pipeline reprioritization, all of that sort of subsided as things matured in Q3, Q4, and we've moved on to having very constructive dialogues about the 2026 pipeline. In our world of biotech, we're seeing a shorter timelines in terms of decision making. We're also seeing an increase in RFP flow coming now from our biotech customers. All of these things, you know, added together, I use the words cautiously optimistic because we've had some of this momentum here in the back half of 2025, excuse me. I'd like to see some more of that momentum before I drop the word cautious in front of my statement.

Understood okay that's helpful. Um and then maybe 1 for Jill, you know the quarter definitely saw some encouraging signs on the margin ibida cash flow front seems like 26 implying continued Improvement, can you just expand a little bit on the key margin levers? It sounds like a a steady ramp throughout the years the right way to think about it there. And if you were to see any upside to revenue, how should we think about the potential flow through to the bottom line? You did talk about Revenue growth being the key driver. So just wanted to talk through that. Thank you guys so much.

Speaker #4: In our world of biotech, we're seeing a shorter timeline in terms of decision-making. We're also seeing an increase in RFP flow coming now from our biotech customers.

Speaker #4: So all of these things, added together, I use the words cautiously optimistic because we've had some of this momentum here in the back half of '26, '25, excuse me.

Sure Patrick. Yes. I mean, you're right in, in my remarks, in terms of the progression through the course of the year. We do see usually a bit of a step down in the first quarter and then it improves over the course of the year, the key drivers. It is, it is revenue growth and I think, as we've said previously,

Speaker #4: I'd like to see some more of that momentum before I drop the word cautious. In front of my statement.

Speaker #3: Understood. Okay. That's helpful. And then maybe one for Jill. The quarter definitely saw some encouraging signs on the margin, EBITDA, cash flow front. Seems like '26 implying continued improvement.

Eric Coldwell: Understood. Okay, that's helpful. Maybe one for Jill. You know, the quarter definitely saw some encouraging signs on the margin. EBITDA cash flow front seems like 2026 implying continued improvement. Can you just expand a little bit on the key margin levers? It sounds like a steady ramp throughout the year is the right way to think about it there. If you were to see any upside to revenue, how should we think about the potential flow through to the bottom line? You did talk about revenue growth being the key driver, just wanted to talk through that. Thank you guys so much.

Patrick Donnelly: Understood. Okay, that's helpful. Maybe one for Jill. You know, the quarter definitely saw some encouraging signs on the margin. EBITDA cash flow front seems like 2026 implying continued improvement. Can you just expand a little bit on the key margin levers? It sounds like a steady ramp throughout the year is the right way to think about it there. If you were to see any upside to revenue, how should we think about the potential flow through to the bottom line? You did talk about revenue growth being the key driver, just wanted to talk through that. Thank you guys so much.

That is going to be the key to getting back to peer margins over time. And in, in this year, we're seeing a bit of a step back in Revenue, it's it's roughly split quite frankly between passed through mix and then some continued headwinds in

Speaker #3: Can you just expand a little bit on the key margin levers? It sounds like a steady ramp throughout the year is the right way to think about it there.

Speaker #3: And if you were to see any upside to revenue, how should we think about the potential flow-through to the bottom line? You did talk about revenue growth being the key driver, so I just wanted to talk through that.

Speaker #3: Thank you guys so much.

Speaker #4: Sure, Patrick. Yes. I mean, you're right in my remarks in terms of the progression through the course of the year. We do see usually a bit of a step down in the first quarter, and then it improves over the course of the year.

Jill McConnell: Sure, Patrick. Yes, I mean, you're right in my remarks in terms of the progression through the course of the year. We do see usually a bit of a step down in Q1, and then it improves over the course of the year. The key drivers, it is revenue growth, and I think as we've said previously, that is going to be the key to getting back to peer margins over time. In this year, we're seeing a bit of a step back in revenue. It's roughly split, quite frankly, between pass-through mix and then some continued headwinds in FSP primarily. You know, we're going to continue with the cost savings optimization. The cost journey is what's going to help us, while revenue is still a bit measured, to continue to expand the bottom line.

Speaker #4: The key drivers, it is revenue growth, and I think as we've said previously, that is going to be the key to getting back to peer margins over time.

Speaker #4: And in this year, we're seeing a bit of a step back in revenue. It's roughly split, quite frankly, between pass-through mix and then some continued headwinds in FSP primarily.

Fsp uh primarily but you know, we're going to continue with the cost savings optimization. So the cost journey is what's going to help us? Well, revenue is still a bit measured to continue to expand the bottom line. We're very focused on delivering both margin and adjustability but a dollar um improvements and and we think that with the what we demonstrated this year around the cost savings and hitting those goals, we feel good most of what was built into the guide, has already been initiated for this year. So I think when Revenue comes back assuming the demand environment continues to be supportive, we would expect that to flow through pretty strongly, especially in the beginning, as we continue to pick up some of that trap demand that we have. And obviously in time as we grow more, we would have to revisit, um, perhaps our, our, um, you know, the people side of things. But for now, we believe you would see pretty strong drop through when the revenue starts to come back.

Great. Thank you guys.

1 moment for our next question.

Speaker #4: But we're going to continue with the cost savings optimization. So the cost journey is what's going to help us while revenue is still a bit measured to continue to expand the bottom line.

The next question comes from the line of Elizabeth Anderson with evercore isi, go ahead. Your line is open.

Speaker #4: We're very focused on delivering both margin and adjusted EBITA dollar improvements. And we think that with the what we demonstrated this year around the cost savings and hitting those goals, we feel good.

Jill McConnell: We're very focused on delivering both margin and adjusted EBITDA dollar improvements. We think that what we demonstrated this year around the cost savings and hitting those goals, we feel good. Most of what we've built into the guide has already been initiated for this year. I think when revenue comes back, assuming the demand environment continues to be supportive, we would expect that to flow through pretty strongly, especially in the beginning, as we continue to pick up some of that trapped demand that we have. Obviously, in time, as we grow more, we would have to revisit perhaps you know, the people side of things. For now, we believe you would see pretty strong drop through when the revenue starts to come back.

Speaker #4: Most of what we've built into the guide has already been initiated for this year. So I think when revenue comes back, assuming the demand environment continues to be supportive, we would expect that to flow through pretty strongly, especially in the beginning as we continue to pick up some of that trapped demand that we have and obviously in time as we grow more, we would have to revisit perhaps our the people side of things.

Hi guys. Uh good morning and thanks so much for the question. Um maybe um just to to to talk about the the back half of 25 bookings, a little bit more anything you would call out in terms of like mixed composition or steady start times or something. Or is that sort of very characteristic to what we what we generally think about in terms of the timing of those uh, uh, booking starting to to to phase in and then anything to call out um, timing wise on the accounts payable side that number, um, seems to have flipped around a little bit and I just didn't know if there was a timing aspect of that at all. Thank you so much.

Speaker #4: But for now, we believe you would see pretty strong drop-through when the revenue starts to come back.

Speaker #3: Great. Thank you, guys.

Eric Coldwell: Great. Thank you, guys.

Patrick Donnelly: Great. Thank you, guys.

Speaker #1: One moment for our next question. The next question comes from the line of Elizabeth Anderson with Evercore ISI. Go ahead. Your line is open.

Operator: One moment for our next question. The next question comes from the line of Elizabeth Anderson with Evercore ISI. Go ahead, your line is open.

Speaker #5: Hi, guys. Good morning and thanks so much for the question. Maybe just to talk about this back half of '25 bookings a little bit more, anything you would call out in terms of mixed composition or steady start times or something?

Elizabeth Anderson: Hi, guys. Good morning, and thanks so much for the question. Maybe just to talk about the back half of 25 bookings a little bit more. Anything you would call out in terms of, like, mix composition or study start times or something, or is that sort of very characteristic to what we generally think about in terms of the timing of those bookings starting to phase in? Anything to call out timing-wise on the accounts payable side? That number seems to have flipped around a little bit, and I just didn't know if there was a timing aspect of that at all. Thank you so much.

Speaker #5: Or is that sort of very characteristic to what we generally think about in terms of the timing of those bookings starting to phase in?

Elizabeth, thanks for the question. Um, there's nothing specific to call out on the bookings. I think, uh, the if I look at the mix of our, uh, new business coming in in uh, the last 2 quarters. It's in line with what I would expect in terms of therapeutic area. Mix in terms of study, mix of types of studies that are coming in. Uh, we've had strength in both clinical pharmacology, as well as our full service business in the late stage, uh, a mix of based using base 3. So I'm actually quite happy uh uh of the quality and mix of what we're putting into the backlog over the last 2 quarters. So but nothing. That would be the only thing to call out.

Speaker #5: And then anything to call out timing-wise on the accounts payable side? Is that number seems to have flipped around a little bit, and I just didn't know if there was a timing aspect of that at all.

Speaker #5: Thank you so much.

Speaker #4: Sure. Elizabeth, thanks for the question. There's nothing specific to call out on the bookings. I think the if I look at the mix of our new business coming in in the last two quarters, it's in line with what I would expect in terms of therapeutic area mix, in terms of study mix, of types of studies that are coming in.

Anshul Thakral: Elizabeth, thanks for the question. There's nothing specific to call out on the bookings. I think, if I look at the mix of our new business coming in in the last 2 quarters, it's in line with what I would expect in terms of therapeutic area mix, in terms of study mix, the types of studies that are coming in. We've had strength in both clinical pharmacology as well as our full service business in the late stage, mix of phase 2 and phase 3. I'm actually quite happy of the quality and mix of what we're putting into the backlog over the last 2 quarters. But nothing to call out there, Elizabeth, and I'll ask Jill to comment on the second part.

Speaker #4: We've had strength in both clinical pharmacology as well as our full-service business in the late stage mix of phase twos and phase threes. So I'm actually quite happy of the quality and mix of what we're putting into the backlog over the last two quarters.

They would stay or be in and around that level, but it is mostly around improvements and unwinding some of the things that were been related.

Speaker #4: But nothing that would be nothing to call out there, Elizabeth. And I'll ask Jill to comment on the second part.

Great, thank you so much.

Thank you. Stand by for our next question.

Speaker #5: Sure. Yes. Elizabeth from an accounts payable perspective, there are a couple of things that are impacting it. It has come down to quite a lower level compared to where we were at the time of the spin and a year ago.

Jill McConnell: Sure. Yes, Elizabeth Anderson, from an accounts payable perspective, there are a couple of things that are impacting it. You know, it has come down to quite a lower level compared to where we were, at the time of the spin in a year ago. There's a few factors for that. One, we had inherited a pretty significant payment hold at the end of quarters. We've completely unwound that. At last year, you would remember, we still had some significant one-time and TSA and other costs that were coming in, and so those would have been sitting in the AP balance at the end of the year. Honestly, with the introduction of the new ERP, we've improved those processes and had to, and that's allowed us to be a lot more efficient in what we're doing.

The next question comes from the line of Eric Coldwell with beard. Go ahead, your Line's open.

Speaker #5: There's a few factors for that. One, we had inherited a pretty significant payment hold at the end of quarters. We've completely unwound that. Last year, you would remember, we still had some significant one-time and TSA and other costs that were coming in.

Speaker #5: And so those would have been sitting in the AP balance at the end of the year. And then honestly, with the introduction of the new ERP, we've improved those processes and had to and that's allowed us to be a lot more efficient what we're doing.

Speaker #5: I would expect I wouldn't expect the AP levels to go down much more from this. I think they're probably at a place where they would stay or be in and around that level.

Jill McConnell: I wouldn't expect the AP levels to go down much more from this. I think they're probably at a place where they would stay or be in and around that level. It is mostly around improvements and unwinding some of the things that were spin related.

Speaker #5: But it has mostly around improvements and unwinding some of the things that were spin-related.

Speaker #1: Great. Thank you so much.

Thanks very much and good morning. You've you've already addressed a couple of these but I was hoping, uh, maybe you could give a little more color on some of the commentary around RFP flow, uh, sounds like it's improving. Uh, if you could add any detail on, that would be great. And then uh, until you said the you're happy with the bookings mix. Um, I was hoping we could get some better directionality on bookings, mix in the fourth quarter, in terms of fsp versus full service or direct versus indirect. Um, I'm interested in your win rate and then finally, uh, new to 4 Trio clients. Um, are there any updates on that front? Because I know that was, uh, a big Initiative for you to, uh, not only retain and grow existing clients, but also to bring new clients into the fold.

Elizabeth Anderson: Great. Thank you so much.

Speaker #2: Thank you, stand by for our next question. The next question comes from the line of Eric Caldwell with Baird. Go ahead. Your line's open.

Operator: Thank you. Stand by for our next question. The next question comes from the line of Eric Coldwell with Baird. Go ahead, your line's open.

Speaker #3: Thanks very much and good morning. You've already addressed a couple of these, but I was hoping maybe you could give a little more color on some of the commentary around RFP flow.

Eric Coldwell: Thanks very much, and good morning. You've already addressed a couple of these, but I was hoping maybe you could give a little more color on some of the commentary around RFP flow. Sounds like it's improving. If you could add any detail on that, would be great. Then, Anshul, you said you're happy with the bookings mix. I was hoping we could get some better directionality on bookings mix in Q4 in terms of FSP versus full service or direct versus indirect. I'm interested in your win rate, and then finally, new to Fortrea clients. Are there any updates on that front? Because I know that was a big initiative for you to not only retain and grow existing clients, but also to bring new clients into the fold.

Speaker #3: It sounds like it's improving if you could add any detail on that would be great. And then Anshul, you said you're happy with the bookings mix.

Okay, great. Eric, thanks for the question. Uh, I, I think it's multi Park question. I'll do my best to answer as much of it as I remember, um, in terms of the mix of booking, you know, I I if we don't typically comment on uh, pastors versus directs, but I will tell you, there's nothing unusual in K3 K4. This is in line with what I would expect.

Speaker #3: I was hoping we could get some better directionality on bookings mix in the fourth quarter in terms of FSP versus full-service or direct versus indirect.

Speaker #3: I'm interested in your win rate and then finally new to Fortrea clients. Are there any updates on that front? Because I know that was a big initiative for you to not only retain and grow existing clients, but also to bring new clients into the fold.

Speaker #4: Okay. Great, Eric. Thanks for the question. I think it's a multi-part question. I'll do my best to answer as much of it as I remember.

Anshul Thakral: Okay, great, Eric, thanks for the question. I think it's a multi-part question. I'll do my best to answer as much of it as I remember. In terms of the mix of booking, you know, we don't typically comment on pass-throughs versus directs, but I will tell you there's nothing unusual in Q3, Q4. This is in line with what I would expect to see in terms of the mix of the type of work coming in. It was a good, healthy mix of phase two, phase three, which is good for Fortrea. We'd like to see some more of those larger phase threes come in, so it's very proud of the team and what they were able to achieve. I will give a couple more comments around the bookings.

Speaker #4: In terms of the mix of bookings, we don't typically comment on pass-throughs versus directs, but I will tell you there's nothing unusual in Q3, Q4.

Speaker #4: This is in line with what I would expect. To see in terms of the mix of the type of work coming in, it was a good, healthy mix of phase two, phase threes.

Um, to see in terms of the mix of the type of work coming in, it was a good healthy mix of phase 2 phase 3 uh which is good for portrayal, we'd like to see some more of those larger phase 3 come in. So it's very proud of the team did what they were able to achieve. I will I will give a couple more comments around around the bookings. We have seen a pickup in full service work which has been a lot of my push has been to be very uh, selective when it comes to FST. We want to continue to be strategic and we want to be continued to be disciplined. Fsp does cause a lot of headwinds when you're on a margin Improvement journey. And so, I'm very proud of the team that the the shape of our pipe. The shape of what's coming in has been um, uh, towards the fso world which is more of what I would like and it is more of a strategically. I've been pushing the team um in terms of our uh win rates. Uh I think our win rates are where I would like them to be. Um, the win rates have been modestly consistent across Q3.

Speaker #4: Which is good for Fortrea. We'd like to see some more of those larger phase threes come in. So it's very proud of the team in what they were able to achieve.

Speaker #4: I will give a couple more comments around the bookings. We have seen a pickup in full-service work, which has been a lot of my push has been to be very selective when it comes to FSP.

Anshul Thakral: We have seen a pickup in full service work, which has been a lot of my push, has been to be very selective when it comes to FSP. We want to continue to be strategic, and we want to continue to be disciplined. FSP does cause a lot of headwinds when you're on a margin improvement journey. I'm very proud of the team that the shape of our pipe, the shape of what's coming in, has been towards the FSO world, which is more of what I would like, and it is more of where strategically I've been pushing the team. In terms of our win rates, I think our win rates are where I would like them to be. The win rates have been modestly consistent across Q3, Q4.

Speaker #4: We want to continue to be strategic, and we want to be continuing to be disciplined. FSP does cause a lot of headwinds when you're on a margin improvement journey.

Q4, um, the need to portray a customer hiccup that the company had in Q2 website is very quickly, in Q3 uh with the CEO being put in place. And um, and for me, I've instituted that all deals are executive-led engagements all all of our biotech and biofarma customers are getting a different level of uh executive involvement than they typically would have been in the commercial process. And we're doing that pretty consistently. That took away any fear

Speaker #4: And so I'm very proud of the team that the shape of our pipe, the shape of what's coming in has been towards the FSO world, which is more what I would like.

That need to buy new to portray a biotech customers that would have. And I saw none of that hesitation in, in Q4 what I did like about Q4 from an RP flow. That was another 1 of the questions that you asked. But I liked about the Q4 was, um,

Speaker #4: And it is more of where strategically I've been pushing the team. In terms of our win rate, I think our win rates are where I would like them to be.

Speaker #4: The win rates have been modestly consistent across Q3, Q4. The new to Fortrea customer hiccup that the company had in Q2 subsided very quickly in Q3 with the CEO being put in place and for me, I've instituted that all deals are executive-led engagements all of our biotech and biopharma customers are getting a different level of executive involvement than they typically would have been in the commercial process.

We had a lot more RP flow coming from biotech. So we saw growth in our biotech rfp's low which is consistent with, what I think, what might some of my peers have said and consistent with what we're seeing in the market, and I was very, uh, proud of portrait his win rate in that space.

Anshul Thakral: The new to Fortrea customer hiccup that the company had in Q2 subsided very quickly in Q3, with the CEO being put in place. For me, I've instituted that all deals are executive-led engagements. All of our biotech and biopharma customers are getting a different level of executive involvement than they typically would have been in the commercial process, and we're doing that pretty consistently. That took away any fears that new to Fortrea biotech customers would have, and I saw none of that hesitation in Q4. What I did like about Q4 from an RFP flow, that was another one of the questions that you asked.

Hopefully, that helps sir, it it does and I know it was a 4-part question, but I am going to ask a a follow-up um, on q16? No, no doubt.

Speaker #4: And we're doing that pretty consistently. That took away any fears that new to Fortrea biotech customers would have. And I saw none of that hesitation in Q4.

You'll get more of me later too, on, uh, on Q, uh, q1 specifically. Um, in terms of the phasing, I know you, you briefly touched on that, but I just given the lumpiness and the the pass through revenue and how much that can gyate quarter to quarter, uh,

Speaker #4: What I did like about Q4 from an RFP flow that was another one of the questions that you asked, what I liked about Q4 was we had a lot more RFP flow coming from biotech.

Anshul Thakral: What I liked about Q4 was, we had a lot more RFP flow coming from biotech, so we saw growth in our biotech RFP flow, which is consistent with what I think what my, some of my peers have said, and consistent with what we're seeing in the market. I was very proud of Fortrea's win rate in that space. Hopefully, that helps, Eric.

Speaker #4: So we saw growth in our biotech RFP flow, which is consistent with what I think some of my peers have said and consistent with what we're seeing in the market.

coupled with the seasonality and the, you know, the impact of still working through the the transition and rebuild of the company, the the bad 1 H25 bookings. Etc. Can you just help us hold our hand a little more on modeling so we don't get ahead of our skates going into q1.

Speaker #4: And I was very proud of Fortrea's win rates in that space. Hopefully, that helps, Eric.

Speaker #3: It does. And I know it was a four-part question, but I am going to ask a follow-up. On Q1, specifically.

Eric Coldwell: It does, I know it was a four-part question, but I am gonna ask a follow-up. On Q1 specifically.

Anshul Thakral: I have no doubt.

Speaker #4: No, no doubt.

Speaker #3: You'll get more of me later too. On Q1 specifically, in terms of the phasing, I know you briefly touched on that, but I just given the lumpiness and the pass-through revenue and how much that can gyrate quarter to quarter, coupled with the seasonality and the impact of still working rebuild of the company, the bad 1H25 bookings, etc., can you just help us hold our hand a little more on modeling so we don't get ahead of our skates going into Q1?

Eric Coldwell: You'll get more of me later, too. On Q1 specifically, in terms of the phasing, I know you briefly touched on that, but I just given the lumpiness and the pass-through revenue and how much that can gyrate quarter to quarter, coupled with the seasonality and the, you know, the impact of still working through the transition and rebuild of the company, the bad 1H 2025 bookings, et cetera, can you just help us hold our hand a little more on modeling so we don't get ahead of our skates going into Q1?

We have a little bit more headwind to absorb there. Plus we always see some pickup in early on employment and some other taxes in the year. So that impacts the first quarter but I that should hopefully give you some sense of what key 1 would look like.

Speaker #4: Yeah, sure, Eric. Happy to. So I think, again, we know I talked about the fact that we saw a bit of a step down.

Jill McConnell: Yeah, sure, Eric, happy to. I think, again, I talked about the fact that we saw a bit of a step down, you know, sequentially in revenue, a lot of that driven by the pass-through mix. We're expecting that to continue, and in fact, part of the reduction year-over-year, a good chunk of the reduction year-over-year, is related to that. I think revenue-wise, it's gonna be broadly similar to what we saw last year. That would be our expectation. You know, remember, as we've been on the journey to reintroduce variable comp, we did a step change in that in 2025. We have a little bit more headwind to absorb there.

Speaker #4: Sequentially in revenue, a lot of that driven by the pass-through mix we're expecting that to continue and, in fact, part of the reduction year on year, a good chunk of the reduction year on year is related to that.

And just to be clear Jill, when you say Revenue similar, are you talking in terms of growth rate or absolute dollars? And then same question on margin is it. Uh, or profit, is it Mark? You said margin would improve a little bit. Uh, I I assume that was a year-over-year comment while, you know. Yeah, down down quarter of a quarter.

Up year-over-year. Okay. Thanks very much, correct.

Speaker #4: So I think revenue-wise, it's going to be broadly similar to what we saw last year. That would be our expectation. But you'll see a little bit of improvement in margin just because of all the cost-saving initiatives that we've done.

Thank you. 1 moment for our next question.

The next question comes from the line of David windley with Jeffrey's go ahead. Your line is open.

Hi, thanks for taking my questions. Um,

Speaker #4: But remember, as we've been on the journey to reintroduce variable comp, we did a step change in that in 2025. We have a little bit more headwind to absorb there.

Speaker #4: Plus, we always see some pickup early on employment in some other taxes in the year. So that impacts the first quarter. But that should hopefully give you some sense of what Q1 would look like.

Jill McConnell: We always see some pickup in early on in employment and some other taxes in the year. That impacts Q1, but that should hopefully give you some sense of what Q1 would look like.

Is and appreciate the information the um customer mix, I guess and and and revenue growth metrics along with your clinical pharmacology business. I'm trying to to disaggregate a little bit. Your top customer appears to have grown in the high 20% range.

Speaker #3: And just to be clear, Jill, when you say revenue similar, are you talking in terms of growth rate or absolute dollars and then same question on margin?

Eric Coldwell: Just to be clear, Jill, when you say revenue similar, are you talking in terms of growth rate or absolute dollars? Same question on margin, is it or profit, is it you said margin would improve a little bit, I assume that was a year-over-year comment, while-

Speaker #3: Is it or profit? Is it you said margin would improve a little bit, but I assume that was a year-over-year comment while down quarter over quarter.

You also had as you had earlier described um this this kind of large and perhaps somewhat unique albeit. You've told me not completely unique clinical pharmacology package

Jill McConnell: Yes.

Eric Coldwell: You know.

Jill McConnell: Yes

Eric Coldwell: down quarter-over-quarter

Jill McConnell: Yes, year-over-year.

Eric Coldwell: Up year-over-year. Okay.

Speaker #3: Up year-over-year. Okay. Thanks very much.

Jill McConnell: Yes.

Eric Coldwell: Thanks very much.

Speaker #4: Yes. Correct. Yes.

Jill McConnell: Correct. Yes.

Speaker #1: Thank you. One moment for our next question. The next question comes from the line of David Winley with Jefferies. Go ahead. Your line is open.

Operator: Thank you. One moment for our next question. The next question comes from the line of David Windley with Jefferies. Go ahead, your line is open.

Speaker #3: Hi. Thanks for taking my questions. And I appreciate the information. The customer mix, I guess, and revenue growth metrics along with your clinical pharmacology business, I'm trying to disaggregate a little bit.

In GOP ones burned quickly Incorporated a lot of sites, not all of which were yours, which drove some of the excess pass through. Uh, I guess what I'm getting at is to what extent did those overlap and to what extent, um, are these Trends continuing or repeatable? In other words, is some of the headwind that you have to

Anshul Thakral: Hi, thanks for taking my questions. Appreciate the information. The customer mix, I guess, and revenue growth metrics, along with your clinical pharmacology business, I'm trying to disaggregate a little bit. Your top customer appears to have grown in the high 20% range. You also had, as you had earlier described, this kind of large and perhaps somewhat unique, albeit you told me not completely unique, clinical pharmacology package in GLP-1s, burned quickly, incorporated a lot of sites, not all of which were yours, which drove some of the excess pass-through. I guess what I'm getting at is, to what extent do those overlap, and to what extent are these trends continuing or repeatable?

David Windley: Hi, thanks for taking my questions. Appreciate the information. The customer mix, I guess, and revenue growth metrics, along with your clinical pharmacology business, I'm trying to disaggregate a little bit. Your top customer appears to have grown in the high 20% range. You also had, as you had earlier described, this kind of large and perhaps somewhat unique, albeit you told me not completely unique, clinical pharmacology package in GLP-1s, burned quickly, incorporated a lot of sites, not all of which were yours, which drove some of the excess pass-through. I guess what I'm getting at is, to what extent do those overlap, and to what extent are these trends continuing or repeatable?

Uh say overcome in 26 because you don't get a repeat, CP package like that and maybe you also are not expecting to see, you know, a top customer continued outgrow the rest of the base as fast as it has. Thanks,

Speaker #3: Your top customer appears to have grown in the high 20% range. You also had, as you had earlier described, this kind of large and perhaps somewhat unique, albeit you've told me not completely unique, clinical pharmacology package.

Speaker #3: In GLP-1s, burned quickly, incorporated a lot of sites, not all of which were yours, which drove some of the excess pass-through. I guess what I'm getting at is to what extent did those overlap?

Okay, um, so I'm going to try to disagree at some of that. Uh, David and I think, you know, when we've talked later, we can talk in more detail on that, I'm not sure. We're following the same statistic on terms of our largest customer growing 20%. I don't think that's the, uh, that was the right math for us, I think. Um, but we can, we can in 24

Sorry, in 24 is percent and 25. It was 18%.

Speaker #3: And to what extent are these trends continuing or repeatable? In other words, is some of the headwind that you have to, say, overcome in '26 because you don't get a repeat CP package like that and maybe you also are not expecting to see a top customer continue to outgrow the rest of the base as fast as it has?

Anshul Thakral: In other words, is some of the headwinds that you have to say, overcome in 2026 because you don't get a repeat clin pharm package like that, and maybe you also are not expecting to see, you know, a top customer continue to outgrow the rest of the base as fast as it has? Thanks. Okay, I'm going to try to disaggregate some of that, David, and I think, you know, when we talk later, we can talk in more detail on that. I'm not sure we're following the same statistic in terms of our largest customer growing 20%. I don't think that's the, that was the right math for us, I think. But we can.

David Windley: In other words, is some of the headwinds that you have to say, overcome in 2026 because you don't get a repeat clin pharm package like that, and maybe you also are not expecting to see, you know, a top customer continue to outgrow the rest of the base as fast as it has? Thanks. Okay, I'm going to try to disaggregate some of that, David, and I think, you know, when we talk later, we can talk in more detail on that. I'm not sure we're following the same statistic in terms of our largest customer growing 20%. I don't think that's the, that was the right math for us, I think. But we can.

And that that. So if that's wrong, I apologize. Oh, you're talking about from the full year. Sorry, I, we thought you were trying to say in the fourth quarter and we're like, no, we're looking at fourth quarter data. Sorry. So yes, from the full year of perspective from a 4 year basis. Yes, yes. Okay, so full year basis. Yes! That's correct. It actually stepped down a little bit though. In the fourth quarter, just relative

Okay, so yeah.

Speaker #3: Thanks.

Speaker #4: Okay. So I'm going to try to disaggregate some of that, David. And I think when we've talked later, we can talk in more detail on that.

Speaker #4: I'm not sure we're following the same statistic on terms of our largest customer growing 20%. I don't think that's the that was the right math for us.

Speaker #4: I think. But we can.

Speaker #3: So in '24, sorry, in '24, wasn't it 14-ish percent? In '25, it was 18%? So if that's wrong, I apologize.

David Windley: Sorry, in 2024, wasn't it 14-ish%? In 2025, it was 18%. If that's wrong, I apologize.

Got it corrected. So so no, our, our we've been, you know, the diversification of customers has been clearly a priority and that's taking shape. And we saw, um, we saw good progress on that metric in Q3 and Q4, um, you asked a couple different questions there on clinical pharmacology. Let me try to disaggregate them. Yes, I mentioned in the past. That in our clinical pharmacology business, we saw Pastors in the middle of last year that were, um, that were, uh,

David Windley: Sorry, in 2024, wasn't it 14-ish%? In 2025, it was 18%. If that's wrong, I apologize.

Speaker #4: Oh, you're talking about from the full year. Sorry. We thought you were trying to say in the fourth quarter, and we're like, "No, that didn't make sense."

Jill McConnell: Oh, you're talking about from the full year.

David Windley: Okay.

Jill McConnell: Sorry, I We thought you were trying to say in Q4, and we're like, no, that doesn't make sense.

Anshul Thakral: We were looking at Q4 data. Sorry.

Speaker #3: We were looking at fourth-quarter data. Sorry. So yes, from the full year perspective. From a full-year basis, yes.

Jill McConnell: Yes, yes.

Anshul Thakral: From a full year...

Jill McConnell: From a full year perspective.

Anshul Thakral: From a full year basis, yes.

Speaker #4: Yes. Okay.

Jill McConnell: Yes. Okay.

Speaker #3: From a full-year basis, yes. That's correct.

Anshul Thakral: From a full year basis, yes, that's correct.

Speaker #4: It actually stepped down a little bit, though, in the fourth quarter, just relative so, yeah.

Jill McConnell: It actually stepped down a little bit, though, in Q4, just relative.

Anshul Thakral: Okay.

Jill McConnell: Yeah.

Speaker #3: Got it. That's correct.

David Windley: Got it.

Anshul Thakral: No, we've been, you know, the diversification of customers has been clearly a priority, and that's taking shape, and we saw good progress on that metric in Q3 and Q4. You asked a couple different questions there on clinical pharmacology. Let me try to disaggregate them. Yes, I've mentioned in the past that in our clinical pharmacology business, we saw pass-throughs in the middle of last year that were. Those we can't predict. They come from one or two large studies from a client where we need to use multiple sites on behalf of the client, and that study causes those types of pass-throughs. That was a one-time event that has happened. Those revenues largely burned last year.

Speaker #4: So no, we've been the diversification of customers has been clearly a priority, and that's taking shape. And we saw good progress on that metric in Q3 and Q4.

Speaker #4: You asked a couple of different questions there on clinical pharmacology. Let me try to disaggregate them. Yes, I've mentioned in the past that in our clinical pharmacology business, we saw pass-throughs in the middle of last year.

Speaker #4: That were those we can't predict. They come from one or two large studies from a client where we need to use multiple sites on behalf of the client.

Those we can't predict they come from a 1 or 2 large studies from from a client where we need to use multiple sites on the heads of the client and that that study causes um, those types of pastors. Um, that was a 1 time event that if that happened, those revenues largely burned last year. Now to say whether or not, we would get a study like that this year, I don't see 1 in the pipeline, but you never know as, as uh, as their Journey continues. Our journey also continues in terms of us continuing to be able to do on more on our own sites. But I can't predict when those type of studies are going to come. And that's what we talked about in uh Q3 also where that type of a clinical pharmacology study with that said, uh, we've seen strong demand for our clinical pharmacology business to continue to grow quarter of a quarter. In terms of, not just the pipeline, but the demand for services. So we're actually very happy with how that business is is tracking. And we continue to make pushes to increase organic capacity.

Within, uh, within our units wherever we can.

Speaker #4: And that study causes those types of pass-throughs. That was a one-time event that has happened. Those revenues largely burned. Last year, now to say whether or not we would get a study like that this year, I don't see one in the pipeline.

Hopefully David, that answers your questions. Let me know if I get there's a multi-part question, let me know if this 1 of the parts

No, uh yeah. I'm I'm stacking multi-arts on top of Eric's multi-part. So thank you for your endurance. Yes, I'm trying to track them all.

Anshul Thakral: To say whether or not we would get a study like that this year, I don't see one in the pipeline, but you never know. As their journey continues, our journey also continues in terms of us continuing to be able to do more on our own sites. I can't predict when those type of studies are going to come, and that's what we talked about in Q3 also for that type of a clinical pharmacology study. With that said, we've seen strong demand for our clinical pharmacology business. It continues to grow quarter-over-quarter in terms of not just the pipeline, but the demand for services. We're actually very happy with how that business is tracking, and we continue to make pushes to increase organic capacity within our units wherever we can.

Yeah.

Thank you. And

Speaker #4: But you never know. As their journey continues, our journey also continues in terms of us continuing to be able to do on more on our own sites.

Add to the queue to ask a question. Please press star 1, 1 on your telephone, and wait for your name to be announced.

Speaker #4: But I can't predict when those types of studies are going to come. And that's what we talked about in Q3 also where that type of a clinical pharmacology study.

Still under a thing with truist Securities, go ahead. Your line is open.

Speaker #4: With that said, we've seen strong demand for our clinical pharmacology business. It continues to grow quarter over quarter in terms of not just the pipeline, but the demand for services.

Speaker #4: So we're actually very happy with how that business is tracking, and we continue to make pushes to increase organic capacity within our units wherever we can.

Speaker #4: Hopefully, David, that answers your questions. Let me know if I missed it. It was a multi-part question. Let me know if I missed one of the parts.

Anshul Thakral: Hopefully, David, that answers your questions.

David Windley: Got it.

Anshul Thakral: Let me know if I missed. It's a multi-part question. Let me know if I missed one of the parts.

Speaker #3: No, no. Yeah, I'm stacking multi-parters on top of Eric's multi-parters, so thank you for your endurance.

David Windley: Yeah, I'm stacking multi-parters on top of Eric's multi-parters, so thank you for your endurance.

Thank you, and thanks for taking my questions. So, I'm sure I want to go back to your comment, about AI, you described as a force multiplier that exploit execution, and expand demand for Crows. Clearly, the way C shares have traded recently, with a lot of fear out there in terms of cro Services getting disrupted, I would love your thoughts there. And additionally can you elaborate on how all this focus on AI, beginning to influence, customer conversations or your differentiation? For example, are biotechnological looking at AI enabled. Execution is a key factor while deciding on Awards. Since just give us a little more color there.

Speaker #4: Yes. I'm trying to track them all.

Anshul Thakral: Yes, I'm trying to track them all.

Speaker #3: Yeah.

David Windley: Yeah.

Speaker #1: Thank you. And as a reminder, to be added to the queue to ask a question, please press star 11 on your telephone and wait for your name to be in the line of Jilendra Singh with Truist Securities.

Operator: Thank you. As a reminder, to be added to the queue to ask a question, please press star one one on your telephone and wait for your name to be announced. Our next question comes from the line of Jailendra Singh with Truist Securities. Go ahead, your line is open.

Speaker #1: Go ahead. Your line is open.

Speaker #5: Thank you. And thanks for taking my questions. So Anshul, I want to go back to your comment about AI. You described it as a force multiplier that accelerates execution and expand demand for CROs.

Jailendra Singh: Thank you, and thanks for taking my questions. Anshul, I want to go back to your comment about AI. You described it a force multiplier that accelerates execution and expand demand for CROs. Clearly, the way CRO shares have traded recently, there's a lot of fear out there in terms of CRO services getting disrupted. I would love your thoughts there. Additionally, can you elaborate on how all this focus on AI beginning to influence customer conversations or your differentiation? For example, are biotech and large pharma looking at AI-enabled execution as a key factor while deciding on awards? Just give us a little more color there.

Speaker #5: Clearly, the way CRO shares have traded recently, there's a lot of fear out there in terms of CRO services getting disrupted. I would love your thoughts there.

Speaker #5: And additionally, can you elaborate on how all this focus on AI beginning to influence customer conversations or your differentiation? For example, our biotech and large pharma looking at AI-enabled execution as a key factor while deciding on awards.

I'm happy to talk about this is you can imagine this topic comes up very often right now, but I think the topic is being driven more by sentiment and headline, then changes were actually seen on the ground in terms of either customer Behavior or demand. As I mentioned, I think the AI adoption in clinical trials remains early its cautious. It's highly constrained by regulation liability data Integrity, gcp requirements. Many of you on this call have written papers and reports around this topic and I think, uh, the whole industry is kind of aligned on that. I want to make sure that market sentiment uh doesn't get too far away from the reality on the ground. Um, as a result look we're not seeing AI replace. The need for large scale, clinical execution or permits monitoring or regular Tori grade delivery, I do.

Speaker #5: Just give us a little bit more color there.

Speaker #4: All right, Jilendra. I'm happy to talk about this. As you can imagine, this topic comes up very often right now. Look, I think the topic is being driven more by sentiment and headline than changes we're actually seeing on the ground in terms of either customer behavior or demand.

Anshul Thakral: Sure, Jailendra, I'm happy to talk about this. As you can imagine, this topic comes up very often right now. Look, I think the topic is being driven more by sentiment and headlines than changes we're actually seeing on the ground in terms of either customer behavior or demand. As I've mentioned, I think the AI adoption in clinical trials remains early. It's cautious. It's highly constrained by regulation, liability, data integrity, GCP requirements. Many of you on this call have written papers and reports around this topic, and I think the whole industry is kind of aligned on that. I want to make sure that market sentiment doesn't get too far away from the reality on the ground. As a result, look, we're not seeing AI replace the need for large-scale clinical execution, patient recruitment, monitoring, or regulatory grade delivery.

Speaker #4: As I've mentioned, I think the AI adoption in clinical trials remains early. It's cautious. It's highly constrained by regulation liability, data integrity, GCP requirements.

Speaker #4: Many of you on this call have written papers and reports around this topic. And I think the whole industry is kind of aligned on that.

Speaker #4: I want to make sure that market sentiment doesn't get too far away from the reality on the ground. As a result, look, we're not seeing AI replace the need for large-scale clinical execution, patient recruitment, monitoring, or regular-grade delivery.

Speaker #4: I do think AI is going to accelerate pipelines more than it is going to eliminate work. So I know as I talk to our C-suite of our large pharma companies, AI is already having impact in terms of the world of discovery.

Anshul Thakral: I do think AI is going to Xcellerate pipelines more than it is than to eliminate work. I know as I talk to the C-suite of our large pharma companies, AI is already having impact in terms of the world of discovery, in terms of the world of decision making, in terms of the world of being able to move pipelines forward. Not necessarily in the terms of replacing human labor, even on the pharma side, to be able to run the actual clinical trials and do clinical development. As I said a couple of times, I think I do see this as a force multiplier, and the more we can move science forward, the faster, the more science there is for us to develop. I actually think it will have a positive impact in how our market grows.

You think AI is going to accelerate pipelines more than it is than to eliminate work. So, I know, as I talked to our existing Suite of our large Pharma companies, AI is already, um, um, having impact in terms of the world of Discovery in terms of the world of decision, making in terms of the world of, uh, being able to move pipelines forward. Uh, not necessarily in the terms of replacing human labor. Even on the far side to be able to run the actual clinical trials and do clinical development. As I said a couple of times, I think I do see this as a force multiplier and the more we can move science forward the faster. The more science there is for us to develop. Um, I actually think it is to have a positive impact in, how our Market grows, um, as far as the behaviors in Outsourcing. That was a, a second part of your question. We've not seen large Pharma or biotech materially change anything in that Outsourcing Behavior as a result of AI, does AI come up as a topic of conversation and essentially every

Speaker #4: In terms of the world of decision-making, in terms of the world of being able to move pipelines forward, not necessarily in the terms of replacing human labor, even on the pharma side to be able to run the actual clinical trials and do clinical development.

Speaker #4: As I said a couple of times, I think I do see this as a force multiplier. And the more we can move science forward, the faster, the more science there is for us to develop.

Uh, proposal. Yes, it does. It comes up in all of my conversations but I find that we as a PR industry are fairly aligned and out how I see even our peers talk, and we're fairly aligned with our customers and our clients in biotech and Pharma. So we are seeing ai's ability to improve some oversight, ability to improve some trial design, stability, to improve some internal decision making and ability to, um, give us some efficiencies in areas of Pascal automation. But certainly, it's more of a productivity tool, not a

Speaker #4: I actually think it will have a positive impact in how our market grows. As far as the behaviors in outsourcing, that was the second part of your question.

Replacement tool and that's been pretty consistent in the conversations I'm having. And it has not been an influence in any RFP or proposal that I've received thus far.

Hopefully that answers your question, gender.

Anshul Thakral: As far as the behaviors in outsourcing, that was the second part of your question, we've not seen large pharma or biotech materially change anything in their outsourcing behavior as a result of AI. Does AI come up as a topic of conversation in essentially every proposal? Yes, it does. It comes up in all of my conversations, but I find that we as a CRO industry are fairly aligned in how I see even our peers talk, and we're fairly aligned with our customers and our clients in biotech and pharma. We are seeing AI's ability to improve some oversight, ability to improve some trial design, ability to improve some internal decision making, and ability to give us some efficiencies in areas of task automation.

Yeah, perfect. Thanks. So

Speaker #4: We've not seen large pharma or biotech materially change anything in their outsourcing behavior as a result of AI. Does AI come up as a topic of conversation in essentially every proposal?

Thank you. Stand by for our next question.

The next question comes from the line of Max Smock with William Blair go ahead. Your line is open.

Speaker #4: Yes, it does. It comes up in all of my conversations. But I find that we as a CRO industry are fairly aligned in how I see even our peers talk.

Speaker #4: And we're fairly aligned with our customers and our clients in biotech and pharma. So we are seeing AI's ability to improve some oversight, the ability to improve some trial design, the ability to improve some internal decision-making.

Hey, good morning. Thanks for taking our questions and we just following up on a portion of Eric's. Question earlier around mix. I wonder if there's any detail you can give around expectations for direct fee. Revenue versus pass through Revenue in 2026 and just how changes in mix are going to impact margins this year. Thank you.

For Max, I mean, in terms of the evolution of Revenue, I think we are.

Speaker #4: And the ability to give us some efficiencies in areas of task automation. But certainly, it's more of a productivity tool, not a replacement tool.

Anshul Thakral: Certainly, it's more of a productivity tool, not a replacement tool. That's been pretty consistent in the conversations I'm having, and it has not been an influence in any RFP or proposal that I've seen thus far. Hopefully, that answers your question, Dilendra.

Speaker #4: And that's been pretty consistent in the conversations I'm having. And it has not been an influence in any RFP or proposal that we've seen thus far.

Speaker #4: Hopefully, that answers your question, Jilendra.

Speaker #5: Yeah, perfect. Thanks, Anshul.

Jailendra Singh: Yeah, perfect. Thanks so much.

Speaker #1: Thank you. Stand by for our next question. The next question comes from the line of Max Smock with William Blair. Go ahead. Your line is open.

Justin Bowers: Thank you. Stand by for our next question. The next question comes from the line of Max Smock with William Blair. Go ahead, your line is open.

Speaker #5: Hi. Good morning. Thanks for taking our questions. And we're just following up on a portion of Eric's question earlier on mix. I wonder if there's any detail you can give around expectations for direct fee revenue versus pass-through revenue in 2026.

Max Smock: Hi, good morning. Thanks for taking our questions. Let me just follow up on a portion of Eric's question earlier around mix. I wonder if there's any detail you can give around expectations for direct fee revenue versus pass-through revenue in 2026, and just how changes in mix there are going to impact margins this year. Thank you.

The growth in our clinical pharmacology business, both service fee. Probably more stabilization to some of the points that achille made more stabilization passed through. Rather than the significant growth, we saw their last year, but it will still be a factor. It does impact clinical pharmacology, Revenue a bit differently. As you know, just the way Revenue recognition works. And then I mentioned that we are expecting further headwinds in fsp and then the so. So when you think about year on year, if I'm talking about Clint Farm having stable um, passes the reduction that we're projecting is related to our full service business. And I think as On Tools said, you know we've been focused on increasing the pipe in the

Speaker #5: And just how changes in mix there are going to impact margins this year. Thank you.

Speaker #4: Sure, Max. I mean, in terms of the evolution of revenue, I think we are expecting continued growth in our clinical pharmacology business, both service fee, probably more stabilization to some of the points that Anshul made, more stabilization of pass-throughs rather than the significant growth we saw there last year.

Jill McConnell: Sure, Max. I mean, in terms of the evolution of revenue, I think we're expecting continued growth in our clinical pharmacology business, both service fee, probably more stabilization to some of the points that Aanchal made, more stabilization pass-throughs rather than the significant growth we saw there last year, but it will still be a factor. It does impact clinical pharmacology revenue a bit differently, as you know, just the way revenue recognition works. I mentioned that we are expecting further headwinds in FSP. So when you think about year-on-year, if I'm talking about clin pharm having stable pass-throughs, the reduction that we're projecting is related to our full service business.

Speaker #4: But it will still be a factor. It does impact clinical pharmacology revenue a bit differently, as you know, just the way revenue recognition works.

Yeah, it's super helpful. Thank you, Joe, I appreciate you taking our question.

1 moment for the next question.

The next question.

Speaker #4: And then I mentioned that we are expecting further headwinds in FSP. And then the so when you think about year-on-year, if I'm talking about ClinPharm having stable pass-throughs, the reduction that we're projecting is related to our full-service business.

Hines with missu ho Securities. Please go ahead.

Speaker #4: And I think as Anshul said, we've been focused on increasing the pipe in those. But I think 25 was there was a phenomenon around a handful of studies.

Jill McConnell: I think as Aanchal said, you know, we've been focused on increasing the pipe in those, but I think 25, there was a phenomenon around a handful of studies, some of which I've called out previously, that were driving really high rates of pass-throughs, that one of them in particular finished early. We hit the endpoints early. As that winds down, we're seeing some of that impact in the numbers for next year. When you think about the year-on-year reduction, it's roughly split about half and half between service fee and pass-through, with clin pharm growing and then the impacts in the other business.

Morning and thank you. Um just on the margins. I know you said you want to get the pure peers over time. Um can you give us a sense? Is it High Teens low 20s? Like what is your ultimate goal and maybe a timetable that would be great.

Speaker #4: Some of which I've called out previously that were driving really high rates of pass-throughs that one of them in particular finished early. We hit the endpoints early as that winds down.

Speaker #4: We're seeing some of that impact in the numbers for next year. So when you think about the year-on-year reduction split about half and half between service fee and pass-through with ClinPharm growing and then the impacts in the other business.

Speaker #5: Yeah. That's super helpful. Thank you, Jill. I appreciate you taking our question.

Max Smock: Yeah, that's super helpful. Thank you, Jill. I appreciate you taking our question.

Speaker #1: Sure.

Speaker #6: One moment for the next question. The next question comes from the line of Anne Hines with Mizuho Securities. Please go ahead.

Justin Bowers: One moment for the next question. The next question comes from the line of Ann Hynes with Mizuho Securities. Please go ahead.

Speaker #7: Good morning, and thank you. Just on the margins, I know you said you want to get the peers over time. Can you give us a sense?

Ann Hynes: Good morning, thank you. Just on the margins, I know you said you want to get to peers over time. Can you give us a sense, is it high teens, low twenties? Like, what is your ultimate goal and maybe a timetable? That would be great.

I think that's a great question. Um, happy to give some but there I think uh it's hard to look at peers when most of our peers are not necessarily in the public market. Um but our belief is mid. Teens is where a peer play cro like ours, that doesn't have a large Central Labs business or other ancillary services like smos Etc belongs. So that is our goal and that is what we're targeting. It it is a it is a multi-year journey and it is going to take some time to get there. Um I've been here for about 2 quarters at this point. I'd like to get a full year under my belt and I would like to spend some time uh doing some form of an investor day and actually having some discussions and giving more details around what that timeline and time frame looks like.

Well, price for later this year.

Speaker #7: Is it high teens, low 20s? What is your ultimate goal? And maybe a timetable that would be great.

Speaker #4: I think that's a great question. Happy to give some stuff there. I think it's hard to look at peers when most of our peers are not necessarily in the public market.

Okay, great. And then I don't know if I missed this but did you talk about um what the how cancellations trended and maybe gross bookings growth? That would be great as well. Thank you.

Anshul Thakral: I think that's a great question. Happy to give some input there. I think, it's hard to look at peers when most of our peers are not necessarily in the public market. Our belief is mid-teen is where a peer play CRO like ours, that doesn't have a large central labs business or other ancillary services like SMOs, et cetera, belongs. That is our goal, and that is what we're targeting. It is a multi-year journey, and it is going to take some time to get there. I've been here for about two quarters at this point.

Speaker #4: But our belief is mid-teens is where a peer-placed CRO like ours that doesn't have a large central labs business or other ancillary services like SMOs, etc., belongs.

And I we haven't had a question on it. I briefly mentioned the remarks. We've actually continued to see historic low levels of cancellation Trends. Nothing major out of the ordinary. So just

kind of more part for the course. It's a it's been stable and consistent at this point. Yeah, yeah.

Great. Thank you.

Speaker #4: So that is our goal. And that's what we're targeting. It is a multi-year journey. And it is going to take some time to get there.

Thank you. 1 moment for our next question.

Speaker #4: I've been here for about two quarters at this point. I'd like to get a full year under my belt. And I would like to spend some time doing some form of an investor day and actually having some discussions and giving more details around what that timeline and timeframe looks like.

Our final question comes from the line of Justin Bowers with DB. Go ahead, your line is open.

Anshul Thakral: I'd like to get a full year under my belt, and I would like to spend some time doing some form of an investor day and actually having some discussions and giving more details around what that timeline and time frame looks like. For later this year.

Speaker #4: We'll probably for later this year.

Speaker #7: Okay. Great. And then I don't know if I missed this, but did you talk about what the how cancellations trended and maybe gross bookings growth?

Ann Hynes: Okay, great. I don't know if I missed this, but did you talk about, how cancellations trended and maybe gross bookings growth? That would be great as well. Thank you.

Speaker #7: That would be great as well. Thank you.

Speaker #4: Anne, we haven't had a question on it. I briefly mentioned the remarks. We've actually continued to see historic low levels of cancellation trends, nothing major out of the ordinary.

Jill McConnell: Ann, we haven't had a question on it. I briefly mentioned the remarks. We've actually continued to see historic low levels of cancellation trends, nothing major out of the ordinary. Just kind of par for the course.

Hi. Good morning, thank you. And I'm sure appreciate you uh letting the genie out of the bottle with respect to AI but with with your comments on accelerating Discovery is that is that something that you're seeing like more near-term or in the last like you know, 12 to 18 months or was that just sort of like a um, you know, longer duration, observation over the last several years. So that's part 1. And then part 2 would be, you know, when you think about the buckets in clinical trial Ops like which, which functions do you think are most addressable in the near term?

Speaker #4: So just kind of more par for the course.

Speaker #7: It's been stable and consistent at this point.

Happy to talk about both and just to be clear. I didn't let the genie out of the bottle. I think.

Anshul Thakral: It's been stable and consistent at this point.

Speaker #4: Yeah.

Jill McConnell: Yes.

Speaker #7: Great. Thank you.

Ann Hynes: Great. Thank you.

Speaker #1: Thank you. One moment for our next question. Our final question comes from the line of Justin Bowers with DB. Go ahead. Your line is open.

Justin Bowers: Thank you. One moment for our next question. Our final question comes from the line of Justin Bowers with DB. Go ahead. Your line is open. Hi, good morning. Thank you. Aanchal, appreciate you letting the genie out of the bottle with respect to AI. With your comments on accelerating discovery, is that something that you're seeing, like, more near term or in the last, like, you know, 12 to 18 months, or is that just sort of like a, you know, longer duration observation over the last several years? That's part one. Part two would be, you know, when you think about the buckets in clinical trial ops, like, which functions do you think are most addressable in the near term?

Operator: Thank you. One moment for our next question. Our final question comes from the line of Justin Bowers with DB. Go ahead. Your line is open.

A genie escaped a couple of weeks ago and that's been a conversation topic for everybody. Um, look in terms of Discovery, you know, that's not an area we're in. But this is a conversation we have with our clients. Um, and I would say that is been happening now for a period of time. Um, I can't give you the exact time

Speaker #8: Hi. Good morning. Thank you. And Anshul, appreciate you letting the genie out of the bottle with respect to AI. But with your comments on accelerating discovery, is that something that you're seeing more near-term or in the last 12 to 18 months?

Operator: Hi, good morning. Thank you. Aanchal, appreciate you letting the genie out of the bottle with respect to AI. With your comments on accelerating discovery, is that something that you're seeing, like, more near term or in the last, like, you know, 12 to 18 months, or is that just sort of like a, you know, longer duration observation over the last several years? That's part one. Part two would be, you know, when you think about the buckets in clinical trial ops, like, which functions do you think are most addressable in the near term?

Speaker #8: Or is that just sort of like a longer-duration observation over the last several years? So that's part one. And then part two would be when you think about the buckets in clinical trial ops, which functions do you think are most addressable in the near term?

Speaker #4: Sure. Happy to talk about both. And just to be clear, I didn't let the genie out of the bottle, I think. A genie escaped a couple of weeks ago.

Anshul Thakral: Happy to talk about both. Just to be clear, I didn't let the genie out of the bottle. I think a genie escaped a couple of weeks ago, and that's been a conversational topic for everybody. Look, in terms of discovery, you know, that's not an area we're in, but this is the conversations we have with our clients. I would say that has been happening now for a period of time. I can't give you the exact time frame, but it's not just the last few months. There's been a lot of conversation around how the use of not just AI, prior to AI, it was the use of data and the ability to process large amounts of data.

Speaker #4: And that's been a conversation topic for everybody. Look, in terms of discovery, that's not an area we're in. But this is a conversation we have with our clients.

Speaker #4: And I would say that has been happening now for a period of time. I can't give you the exact timeframe. But it's not just the last few months.

Speaker #4: It's been a lot of conversation around how to use not just AI prior to AI. It was the use of data. And the ability to process large amounts of data.

Just the last few months, there's been a lot of conversation around how to use of not just AI prior to AI, it was a use of data and the ability to process large amounts of data. How can, uh, our clients get better at what's moving through the discovery, uh, funnel and what's getting out to the clinic, uh, faster and faster. And that conversation is continued, it continues to grow. I only offered that as an observation of what I hear from our clients and where these tools are having the most impact early on, um, in terms of things that I talked about in, uh, earlier too, you know, look, we see levels of task Automation in Pharma vigilance, we're already doing it on our end, we have our own tools that that have been deployed. In particular vigilance such as case, processing, Etc. We're seeing it in forms of centralized monitoring where there's things that we're doing in terms of uh, being able to issue alerts earlier being able to look at the data being able to automate some uh some fairly uh, you know, mundane tasks in centralized monitoring. We're already

see, some

Speaker #4: How can our clients get better at what's moving through the discovery funnel and what's getting out to the clinics faster and faster? And that conversation has continued.

Anshul Thakral: How can our clients get better at what's moving through the discovery funnel and what's getting out to the clinic faster and faster? That conversation has continued. It continues to grow. I only offered that as an observation of what I hear from our clients and where these tools are having the most impact early on. In terms of things that I talked about in earlier too, you know, look, we see levels of task automation in pharmacovigilance. We're already doing it on our end. We have our own tools that have been deployed in pharmacovigilance, such as case processing, et cetera.

back there, and we're starting to see some early impact in the world of data management when it comes to data cleaning, uh, when it comes to, uh, being able to, uh,

look at queries and being able to actually reduce the human labor in in, in what we have to do with that space.

Speaker #4: It continues to grow. I only offered that as an observation of what I hear from our clients and where these tools are having the most impact early on.

Speaker #4: In terms of things that I talked about in earlier too, look, we see levels of task automation in pharmacovigilance. We're already doing it on our end.

We're not seeing an impact in anything that we would be doing at the site itself. Uh, relationships with the site's conversations with the site, the actual uh, physical monitoring of the data right now.

Hopefully Justin that answers your question.

It does. Thank you. I'll uh I'll jump offline for the rest.

Speaker #4: We have our own tools that have been deployed in pharmacovigilance, such as case processing, etc. We're seeing it in forms of centralized monitoring where there's things that we're doing in terms of being able to issue alerts earlier, being able to look at the data, being able to automate some fairly mundane tasks in centralized monitoring.

Thank you. Well, I want as we

Anshul Thakral: We're seeing it in forms of centralized monitoring, where there's things that we're doing in terms of being able to issue alerts earlier, being able to look at the data, being able to automate some fairly, you know, mundane tasks in centralized monitoring. We're already seeing some impact there. We're starting to see some early impact in the world of data management when it comes to data cleaning, when it comes to being able to look at queries and being able to actually reduce some human labor in what we have to do in that space. We're not seeing an impact in anything that we would be doing at the site itself. Relationships with the sites, conversations with the sites, the actual physical monitoring of the data right now. Hopefully, Justin, that answers your question.

Please go ahead.

I I was just seeing if we were done with the questions and I would close out the call. Yes. But I want to further questions.

Speaker #4: We're already seeing some impact there. And we're starting to see some early impact in the world of data management when it comes to data cleaning, when it comes to being able to look at queries and being able to actually reduce some human labor in what we have to do in that space.

Speaker #4: We're not seeing an impact in anything that we would be doing at the site itself. Relationships with the sites, conversations with the sites, the actual physical monitoring of the data right now.

Speaker #4: Hopefully, Justin, that answers your question.

Speaker #8: It does. Thank you. I'll jump offline. For the rest.

Justin Bowers: It does. Thank you. I'll jump offline for the rest.

Speaker #4: Okay.

Anshul Thakral: Okay. Thank you. Well, please go ahead. I was just seeing if we were done with the questions, and I would close out the call. Yes. Any other questions? Thank you. As we come to a close today, I want to thank you for your thoughtful questions and continued engagement. Our performance this last quarter reflects the discipline and operational rigor we have really embedded throughout this organization. We continue to make progress against our strategic initiatives. We continue to strengthen our foundation and enhance our ability to serve clients globally. What matters to our clients is what matters to us most, and we remain focused on delivering high-quality execution and long-term value.

Speaker #1: Thank you.

Speaker #7: Well, as we

Thank you for yourself for questions and continued engagement. Our performance, this last quarter, reflects the discipline and operational rigor. We have really embedded throughout this organization. We continue to make progress against our strategic initiatives. We continue to strengthen our foundation and enhance our ability to serve clients globally. What matters to our clients is what matters to us most and will remain focused on, delivering high-quality execution, and long-term value. Um, the message is we are focused. We're disciplined and we are focused on executing and executing well and we're confident in the direction that the company is beginning to take. So, with that, uh, I thank you for your time and for those, that will be in town and look forward to seeing you at the Barkley's conference on, uh, on March 10th. Thank you.

Speaker #1: Please go ahead.

Speaker #7: I was just seeing if we were done with the questions. And I would close out the call here.

Thank you for your participation. In today's conference, this does conclude the program. You may now disconnect

Speaker #1: Yes. Send emails for the questions.

Speaker #7: Thank you. As we come to a close today, I want to thank you for your thoughtful questions and continued engagement. Our performance this last quarter reflects the discipline and operational rigor we have really embedded throughout this organization.

Speaker #7: We continue to make progress against our strategic initiatives. We continue to strengthen our foundation and enhance our ability to serve clients globally. What matters to our clients is what matters to us most.

Speaker #7: And we'll remain focused on delivering high-quality execution and long-term value. The message is we are focused. We're disciplined. And we are focused on executing and executing well.

Anshul Thakral: The message is we are focused, we're disciplined, and we are focused on executing and executing well, and we're confident in the direction that the company is beginning to take. With that, I thank you for your time, and for those that will be in town, we look forward to seeing you at the Barclays Conference on 10 March. Thank you.

Speaker #7: And we're confident in the direction that the company is beginning to take. So, with that, I thank you for your time. And for those that will be in town, we look forward to seeing you at the Barclays Conference on March 10th.

Speaker #7: Thank you.

Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

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