York Space Systems, Inc. (YSS) Earnings Call Transcript & Summary

Hello, everyone, and thank you for being with us on York Space Systems' Q3 2026 earnings call. Our CEO Dirk Wallinger and CFO Brian Frantz are here alongside me. Just a reminder that you can find the earnings press release at ir.yorkspacesystems.com. An earnings presentation has also been placed on that website, complementing our prepared remarks. Lastly, once the call concludes, a transcript of our prepared remarks and an audio replay will be made available. Should you be listening to the rebroadcast, note that our comments reflect the situation as of today, Thursday, November 12, 2026, and have not been revised since this call. During this call, we will reference some non-GAAP measures. A reconciliation linking those metrics to the closest comparable GAAP metrics appears in our earnings press release. In addition, we'll be making forward-looking statements — among them statements regarding our 2026 outlook; our business strategy, which includes our planned expansion into unmanned systems; future revenue and growth prospects; anticipated award times; backlog; potential unawarded contracts and pipeline; award opportunities; M&A strategy; the proposed acquisition of Outlook and its benefits, along with the benefits of other acquisitions; and inventory and systems build-out. Listeners should be advised that these forward-looking statements rest on certain assumptions and by their nature carry risks and uncertainties that could lead actual results to differ materially from what we currently expect. Listeners should look over the risk factors and other discussions contained in our 2025 annual report on Form 10-K, the 2026 Form 10-Qs, and the rest of our SEC filings. After our prepared remarks conclude, we'll open up the call for questions. I'll now hand things over to Dirk.

Thanks, Chris. Everyone, hello, and welcome to the earnings call for York's third quarter of 2026. I appreciate that you've taken time to be with us. I'm happy to share that Brian Franz has been named York's CFO. During our previous call, I mentioned that Brian came aboard as Chief Accounting Officer in September 2025, and he was central to our shift into being a public company. Directly overseeing financial reporting, internal controls, and SEC compliance, Bryan carries over thirty years of financial leadership experience spanning public and private companies, and I'm delighted that he's in this role. We keep delivering for our customers, we keep broadening what our missions can do, and we keep reinforcing the groundwork for the growth phase ahead. Quarterly revenue came in at $84.2 million, a 7% decline compared with a year earlier, while adjusted EBITDA showed a loss of $27.6 million. At the close of the quarter, funded backlogs were $581 million; potential unawarded contracts totaled $2.84 billion; our identified pipeline reached $14.9 billion; and unexercised options on existing contracts amounted to $750 million, which is up 394% versus the prior quarter. Bryan will take you through the financial specifics in a moment. Across the last three quarters, York kept its backlog around $600 million even as it turned $293 million of that into revenue — showing we can refill backlog via new awards and additions to existing contracts despite an uncertain budget climate. Still, the latest election results make the road ahead clear. Whatever the budget climate, one point stands out. Demand will grow for more competition, even on the biggest national defense programs; we anticipate a notable drop in how concentrated contracts are among particular vendors, along with a matching reallocation of U.S. government budget resources among proven providers. Some firms are going to be in a stronger position to capitalize on that transition, and certain winners won't depend on how big the overall budget is; York, in our view, is among them. Having demonstrated we can deliver at scale, we hold a strategic edge over newcomers, and because our pricing is competitive, customers can buy the volumes needed to sustain the spread of these systems. York sits in an exceptionally strong position across the mission areas the U.S. government ranks as its top priorities — among them the Space Data Network, resilient missile warning tracking, and several intelligence mission areas. These are among the biggest and longest-lasting pockets of government investment. Thanks to support from both parties, we've locked in the key contract positions we were aiming for in 2026, which puts us in a strong spot to pursue major awards in 2027, 2028, and later years. When you add in our track record of execution, our flight-proven capabilities, and our competitive pricing, we think York remains well-positioned as these programs are expected to move toward bigger awards down the road. In the third quarter, York secured a new contract with a classified customer that we refer to as Palm Springs. That award takes our capabilities into additional mission areas and offers a substantial opportunity for follow-on constellations. So that brings us to nine contract wins in 2026 to this point. Beyond those, we added $17.3 million in new business, coming from fresh awards as well as expansions of contracts already in place, since customers continue to widen their use of York capabilities and the integrated ecosystem. During the last call, we mentioned being chosen for the NITE-STAR IDIQ; that program contract is now completely executed, and it positions us to pursue task orders combining our spacecraft with ALL.SPACE mobile terminals and the ATLAS Global Ground Network. ALL.SPACE also received an award from the Defense Innovation Unit, providing it a path to show off its technology and grow adoption throughout the Department of War. There's also mounting interest in the resilient communications technology that ALL.SPACE provides. Following the close of the third quarter, as we recently made public, the U.S. Navy issued follow-on orders covering 59 HydraMAX 2 terminals — lifting its overall ALL.SPACE terminal fleet to 108 systems, 49 of which were delivered earlier. That expansion reflects sustained customer confidence in ALL.SPACE's technology along with growing demand for resilient multi-orbit communications, and it bolsters the chance to extend adoption of these capabilities throughout government and defense markets within York's broader integrated ecosystem. During Q3, as I mentioned on our last call, we launched our second plane of Tranche 1 Transport Layer satellites. Looking at Tranche 0 plus both planes of Tranche 1, we've gone through three satellite generations, improving performance and accelerating production each time. The upshot: satellites for Tranche 2 now get built 78% faster than they did 18 months ago — build time has fallen from nine months to a mere two months. We're aiming for a 90% reduction. That quantifies one of our central competitive edges: the ability to manufacture, integrate, launch, and operate proliferated systems at scale. Yet speed isn't just a scheduling statistic. It reshapes what customers are able to procure, how quickly critical national security capabilities reach the field, and in the end, the cost of proliferated architectures. The benefit of what we've put into manufacturing capacity and spacecraft inventory goes beyond just building satellites — it extends all the way to delivering complete missions. By holding available platforms in inventory, locking in launch capacity, and bringing together our ground infrastructure along with mission operations capability, we're able to deliver turnkey missions as much as 75% faster than the timelines the traditional market works with. That means customers can move from mission requirements to operational capability on schedules that traditional procurement and manufacturing models simply couldn't make possible, which gives York a significant competitive advantage as demand keeps growing for space systems that can be deployed rapidly. Our mission capabilities have expanded quickly with the addition of the M-CLASS, VLEO, LX Ultra, and GEO systems. Our VLEO product line was unveiled in September, and delivery of our Nemesis GEO satellites to the customer is slated for this quarter. Together with the ATLAS ground infrastructure and ALL.SPACE communication terminals, these offerings considerably expand the mission and procurement possibilities open to us. Paired with rising commercial demand across the last two quarters, the pipeline we have identified has expanded by more than 30% relative to the prior quarter. We believe our demonstrated performance in numerous mission areas, plus flight-proven systems and more attractive pricing, gives us a strategic advantage over competitors. What distinguishes us from providers that haven't yet proven themselves is our track record, and we also beat traditional primes when it comes to cost, capability, and speed to orbit; meanwhile, we're moving ahead with plans to leverage York's established space ecosystem as a way to expand into adjacent markets. We had been working to launch four commercial software products. All four are currently being evaluated by customers, and AutoScheduler and Fleet Autonomy are already being deployed across government and commercial mission operations centers; this opens up an opportunity for added revenue from capabilities developed to serve our own mission, extending our software to a broader customer base. Entering unmanned systems represents yet another significant opportunity to make use of the infrastructure we've already constructed. York has built out worldwide ground infrastructure, mobile satcom terminals, and mission software—via ATLAS and ALL.SPACE—to back distributed unmanned operations. The Outlook Industries deal we announced earlier today would extend that ecosystem out to unmanned platforms operating in the field and establish the groundwork for York Terrestrial Systems. Taken together, these capabilities are intended to deliver integrated fleet management plus autonomous operations across long distances, even in areas where terrestrial communications break down and GPS is degraded or denied.

This acquisition we're proposing would give us access to an unmanned ground system market that Mordor Intelligence's newest analysis puts at roughly $3.1 billion. When you add our communications and ground infrastructure, we also see chances in unmanned surface and underwater vessel markets, which MarketsandMarkets estimates at $10.3 billion. Together those add up to about $13.4 billion in addressable markets. We're aiming at mid-December for a first demonstration of tasking and executing autonomous unmanned surface vehicles from space, and we've already sent proposals to military customers for that capability. With demand rising for bigger fleets of unmanned systems, we see meaningful opportunities to supply the connectivity, software, and operational infrastructure required to coordinate those fleets at scale while keeping more warfighters farther from the fight. We also see substantial international opportunities for our core business and our full-stack unmanned autonomy architecture. We're collaborating with Terma, a leading European defense, aerospace, and security company, to assess expansion into European markets, where our mature production infrastructure, demonstrated execution, and competitive pricing leave us well positioned to meet demand for rapidly deployable solutions. We're likewise assessing opportunities in Asia, where we see a chance to capture growing demand. Now turning to the government side of the business, what we're really focused on is the size of the opportunity looking out to 2027 and past that point. Based on the administration's proposed budgets and what we've been hearing from key stakeholders, we anticipate substantial spending in mission areas that line up with York's core strengths. Those strengths include observation — things like space domain awareness and moving target indication, both in the air and on the ground; tracking, which covers missile warning and missile tracking; communications via the Space Data Network and resilient military communications; classified work, including support across a multitude of phenomenologies; and the capacity to respond using proliferated architectures that link sensors, decision-makers, and effectors fast enough to be relevant in a contested environment. Looking at Space Force overall, we figure there's about $14 billion worth of contracts the government might hand out prior to the close of fiscal 2027. On top of that, intelligence community needs open up meaningful further chances, and Army plus Navy demands might tack on roughly another $3 billion. Beyond the budgets themselves, we're noticing the government feels far more urgency around space infrastructure. According to a fact sheet Space Force released in July, China currently has more than 1,500 satellites circling the planet, over 500 of which are ISR vehicles, and China intends to send up a rocket nearly every 2.5 days — producing 140 launches during 2026, a rise of more than 50% compared with the prior year. Maybe that's why there are hopeful indications that the government is picking up the pace on handing out contracts. The IDIQs we've secured represent the essential initial moves leading to significant awards. Through targeted IDIQ selections and preliminary concept research, the U.S. government is building up the pool of suppliers for bigger operational efforts. Meanwhile, the Department of War has clearly stated its requirement for an industrial base that is diversified. A press release from August quoted U.S. Space Force Colonel Frazier, acting portfolio acquisition executive for SBST, who emphasized the importance of avoiding dependence on a single provider. More recently, the Space Force awarded SDN task orders centered on interoperability, and that shows this commitment is turning into funded programs and real contract opportunities; those awards strengthen the government's intention to build a diversified, interoperable architecture for critical national security capabilities. We are putting money behind that demand, though we are doing it with discipline. During the last year, we have grown our business development organization considerably. We now have staff located near major customer centers in Alabama, Northern Virginia, Washington D.C., New Mexico, and Colorado. A large part of that build-out is now complete, and we do not anticipate continuing to add resources at the same rate. In order to support the classified-customer contracts we've recently secured, we've expanded our protected facilities as well—for instance, we increased SCIF capacity. And to speed up delivery for those clients, this quarter we brought an additional 30 manufacturing cells online at Potomac, taking the site from 10 to 40 overall. I'd like to put this in the context of our investment thesis. York has built an industrial framework for producing spacecraft platforms at scale, and the cost, schedule, and execution benefits it offers stem from standardized platforms plus integrated mission architectures. We're beginning to commercialize the software and operational expertise that grew up within that ecosystem, and at the same time we're seeking to expand into unmanned systems via our proposed purchase of Outlook Industries. We think these neighboring markets can open up meaningful new revenue chances past our main business lines. Our planned purchase of Outlook is a major move in growing into unmanned systems, creating a brand-new market for York by leveraging the established space, ground, mission operations, and software ecosystem we've already developed; through Outlook, we aim to stretch that ecosystem to cover unmanned platforms working out in the field, which puts York in position to provide integrated solutions for autonomous operations spanning several domains. The demonstration in mid-December that I brought up earlier will assemble ALL.SPACE's mobile communication terminals, ATLAS's worldwide ground network and network software, York's mission operations centers, and our commercial software capabilities. All these capabilities combined are meant to enable remote tasking via space along with autonomous operation of unmanned systems. That demonstrates our ability to leverage York's current ecosystem for entry into new markets while backing the next generation of distributed autonomous defense operations. It carries forward the vision I had when founding York; our aim was to transform how satellites get built and operated. Our manufacturing approach and on-orbit track record now provide a basis for addressing a far bigger challenge: connecting and sustaining the autonomous distributed force of tomorrow. The fresh political landscape strengthens York's competitive standing even further. We see rising demand for competition and a realignment of U.S. Directing public funds toward established suppliers is going to open up meaningful chances for York no matter how large the overall budget turns out to be. What matters increasingly to the market are precisely the traits York was built to deliver: quickness, size, durability, and a track record of getting things done at a price that competes well. We remain focused on looking after customers, converting what we can do into fresh contracts, and generating lasting worth for shareholders. On that note, I'll hand things over to Brian.

Thanks, Dirk. The key event in Q3 was completing the ALL.SPACE deal, along with four fresh contract wins that could develop into bigger awards across 2027 and 2028. Third-quarter revenue came in at $84.2 million, a decline of $6.6 million, or 7%, versus the same period a year earlier. Since we launched the remaining Tranche 1 satellites during Q3, our year-over-year revenue from that program fell compared with the prior year. Tranche 2 revenue rose against the comparable quarter, yet it did not entirely make up for the drop from other programs. Higher subsidiary revenue likewise partly offset the Tranche 1 decline. Gross margin stood at 18% this quarter, 400 basis points below the prior-year quarter, because we took some one-time inventory adjustments at our subsidiaries that squeezed margins. We are starting to benefit from post-launch operations and support work, given that we currently have more satellites in orbit than was the case a year ago; for the full year, we anticipate gross margin in the low 20% range. Gross margin dollars totaled $15.5 million for the quarter, down $20.3 million in the prior-year quarter, mainly because revenues were lower this quarter. Our contribution margin widened 500 basis points to 40% in Q3, reflecting better performance on our Tranche 2 program than a year earlier. Direct materials expenses fell quarter-over-quarter, mostly because of Tranche 1, since we launched the remaining 21 SVs in the quarter. With all 42 of those satellites now successfully in orbit and healthy, our operations and sustainment revenues are starting to rise, and their contribution margin exceeds the company average. Contribution margin dollars grew modestly, reaching $34 million versus $31.7 million last year, powered by the Tranche 2 performance improvement I mentioned earlier. Now to operating expenses. SG&A plus R&D rose 66% against the prior-year quarter. That increase came mainly from added salaries and costs tied to our 2026 acquisitions, higher overall headcount, and greater overhead associated with the public company uplift. We expect Q4 2026 SG&A plus R&D to be broadly consistent with third-quarter levels. Most of the build-out in our public company SG&A infrastructure is finished now. During Q3, in light of the revenue expectation reduction we announced previously, accounting rules mandated that we begin an analysis of goodwill recoverability. That analysis led us to record a non-cash goodwill impairment charge of $749.7 million in the third quarter of 2026. I would second what Dirk said earlier. We continue to believe bigger program awards are coming in 2027 and beyond, though the timing and size of those awards remain uncertain and have shifted to the right. Adjusted EBITDA for the quarter was a loss of $27.6 million, which is larger than the 2026 level. Up until the acquisition dates, the new subsidiaries had been short on capital, and because of that they couldn't put meaningful resources toward buying inventory. Following each transaction, we supplied the liquidity needed to raise production levels ahead of sales so they would line up better with operating cost levels. For the fourth quarter, we expect adjusted EBITDA loss to come in a bit above Q3 of 2026. Liquidity is still solid. On September 30, 2026, cash and cash equivalents totaled $309 million, and the $150 million revolving credit facility is still entirely undrawn, giving us total liquidity of $459 million. I'd point out that the main cash use during the quarter was the $155 million tied to the ALL.SPACE transaction. Backlog came to $581 million as of September 30, declining just a little in the third quarter. Backlog got a boost from the four contract wins plus modifications to existing contracts totaling $17.3 million, along with $44 million of increases from our subsidiaries, the bulk of which comes from ALL.SPACE, which appears in our numbers for the first time. Moving to full year 2026 revenue guidance, we have narrowed the prior range to $380 million-$400 million, keeping the $390 million midpoint that we discussed on our previous earnings call. We think we are well-positioned to secure new contract awards, but how the timing and amount of those awards into 2027 will play out is still unclear; with that, I'll turn it back to Dirk for a quick summary.

Thanks, Brian. In closing, York has established a solid base for growth, backed by demonstrated execution as well as broadening portfolio capabilities and chances to bring in revenue across additional markets. We have locked in the key contract positions we set our sights on this year within several of the U.S. government's top-priority mission areas, among them the Space Data Network, missile warning and tracking, and intelligence missions. Task orders are already being generated from our IDIQ awards, which puts us in position to vie for bigger awards, contract expansions, and option exercises in 2027 and beyond. Our growing capabilities and rising demand across government and commercial markets have boosted our identified pipeline by over 30% versus last quarter. With the recent election behind us, we anticipate that the new Congress will put more weight on competition and vendor diversity, lowering how concentrated major contracts are among a limited number of suppliers. We think this realignment of government resources across proven providers will strengthen York's position even further. Our opportunity lies in gaining share through demonstrated performance, production capacity, and competitive pricing, regardless of total budget size. We are also starting to commercialize capabilities with software and are pursuing expansion into unmanned systems via our proposed acquisition of Outlook Industries, with customer proposals submitted and an initial demonstration planned for mid-December. These initiatives build on technology, manufacturing capacity, and operational infrastructure in which we have already invested. They widen our addressable market and put York in position to support the government's transition to distributed autonomous fleets. We stay focused on converting that foundation into new business, greater profitability over time, and long-term shareholder value, while delivering the capabilities our customers need to keep the war fighter safe; now, I'll turn it back to the operator for questions. Operator?

Yeah. Hey, everyone. Alex here, filling in for Seth. Good afternoon.

Hi.

Hi there. I'd like to begin by asking about that goodwill impairment charge. Clearly it's a fairly large figure, particularly if we consider the overall goodwill you had last quarter, which I believe came to roughly $790 million. I'm curious whether you could elaborate on it a bit further. Was it tied to an acquisition you completed earlier? Thinking about the business, you've clearly done quite a lot of acquiring. How can we get some reassurance that this kind of thing won't happen again down the road?

Yeah.

That's all yours, Brian.

I'll handle this one, Alex. Per the accounting rules, goodwill has to be evaluated for realization literally each quarter. The majority of those reviews are pretty routine, and most are qualitative; however, in this case, when certain triggering events come into play, which the literature defines, we have to dig a little deeper. During the third quarter, we had two such triggers, the main one being the revenue reduction we discussed back in August, plus our share price at that time trading below book value. So we carried out an extensive analysis, which as you can imagine leans really heavily on discounted cash flow; we worked through that analysis and ultimately recorded a $750 million non-cash impairment charge; but I will say, to address the rest of your question, this all rests on our revenue expectation, as Dirk said, and when we take revenue down the way we did, that's kind of how it works; but I would add, we stay very bullish regarding future awards coming in during 2027 and 2028, just as Dirk said; so I wouldn't expect this to happen again. I think we've moved past this.

Alright, that's very useful. So perhaps a brief follow-up. To begin with, regarding the Q4 top line, I believe it suggests, assuming you use the midpoint of the guidance, a slight sequential increase in sales. I'm curious about the reason for that. And also, I think you mentioned that for the whole year, gross margin would land in the low 20s range. That, I believe, suggests gross margin in Q4 will rise into perhaps the mid-20s, compared with the closer to 18% figure you had in Q3. I'd really like to hear your thinking on why those items should shift in Q4.

Yes, absolutely. I'll address those too. Let me begin with the second part, on gross margin. My view is still that we'll probably finish in the low 20s rather than the mid-20s for the year. We're confident about that. I mean, ideally we can do better, but I don't want to set that expectation too far ahead; on the revenue line, yes, I mean, you are seeing part of that backlog come through. But what I'd say is, with all of these subsidiaries now in the fold, they're beginning to gain some traction, and that's the reason you'll see a bit of that revenue uplift in the fourth quarter.

All right, that's all from me. Thanks, everyone.

Hi, Ben Tomick here, sitting in for David. I just had a question: could you give us an update on where the supply chain stands? I know on the last call you mentioned that some revenue from this year was shifting into 2027 because of that. Have you seen any improvement there, and are there any weak spots you could point to?

Yeah, well, I'll let Brian get into the specifics. But broadly speaking, we are seeing a lot of improvement in the supply chain. As we've been placing bigger and bigger orders more consistently, we're finding that things tend to arrive pretty much on schedule; that was more of a one-time shift involving some propulsion units, or propulsion supplies, I believe, where that moved across a line. I think overall the trend is that the supply chain is definitely getting stronger. Some consistency, frankly, from the government and on the budget side would help with that too, but I think it's improving. Brian, I don't know whether there's anything more you'd like to add.

Right, I'd say that's accurate. You still come across pockets of it in various places, though firms such as ours are in fact attempting to stay ahead of the situation by keeping watch over the supply chain. Building up inventory levels on a number of these key components is among the things we're working on, which lets us steer clear of and soften some of those industry-wide problems out there; so we're monitoring it, we're watching it closely, and honestly there isn't much of a change to report compared with where we stood three months ago.

To build on that a bit further, one thing that stands out about our capabilities is that given how mature our production line is and where we stand in terms of company growth and production, we can put money into inventory. The truth is that when you order based on the need date you have, things will arrive late. For us, though, we've already invested in inventory, and what that means is we'll have the ability to respond the moment a customer asks, without waiting for other things to happen. That's something of a differentiator between York's position in our production maturity and that of some of our peers.

Understood, thanks. Perhaps turning to SDN, might you give us a bit more detail about those task orders you were granted, plus what comes next and the milestones? And then perhaps where you believe York has its greatest opportunity in SDN — more spacecraft, ground network, or some combination of the two.

Yes, so we won two separate task orders for SDN that are public, so that information is out there; we're working on them right now. They're going very well. Working with Space Systems Command and Colonel Frazier on the SDN has been a real pleasure. So those keep moving ahead. It's the overall approach they're taking of, look, they want to see small-scale milestones, demonstrated ability to execute, and then we expect there could potentially be follow-on orders for follow-on spacecraft. Given what we've done on SDA's Transport Layer, right, and the fact that we're flying satellites for that system in orbit today, that sort of gives us an advantage in the sense that building and deploying constellations and communication systems is our bread and butter. So, I think those task orders are going really well. I think with some of the changes we've seen this past week, there's going to be a demand for more competition there, and obviously competition is something we strongly support and an area where we can definitely help the SDN with production.

All right, thank you.

Hi there. Good evening, everyone. Appreciate you taking the question. So Brian, going back to the write-down, could you say specifically which programs caused it? And given the write-down and the tests you had to run there, should we expect revenue to generally remain in this range?

Yes. Let me do my best to answer that. This involves a great many assumptions. Absolutely — we’re reviewing the programs we already have in place. That said, when you run a discounted cash flow analysis extending over multiple years, you’re necessarily relying on many additional assumptions; we do need to assume when new awards might arrive and what their dollar amounts would be. Our model reflected what we’re describing on this call: additional awards beginning to arrive in greater volume toward late 2027 and into 2028. Beyond that, there are numerous other inputs — the discount rate, control premiums, and various other considerations — and they relate to those programs. To return to the equation here: it's non-cash. Regarding the execution piece of what we're set up to do for the remainder of 2026, as well as on our other contracts going forward, we feel good. It's really more about the expectation of future revenues, which is what we discussed on our last call. They're going to come; it's just a question of when, and that's really what the trigger point was.

All right. Dirk, regarding the Outlook acquisition — I mean, you already have terminals, the ATLAS network, your ops center, and software. So why wouldn't you simply seek a partnership with somebody? What's the reason for bringing an unmanned ground manufacturer in-house, something that could quickly become commoditized as competition grows? Is it mainly about completing the demonstration, sort of showcasing it? Or perhaps just help me understand better why it makes sense to keep that within the York umbrella rather than partner with an unmanned manufacturer.

Yes, sure; it's probably closer to the second thing you mentioned. Look, Outlook Industries has excellent technologies. Their autonomy capability, their software capability, their manufacturing ability are all terrific; so don't misunderstand me on that. But it's a smaller company. For us it was a smaller acquisition, right? No eight-K filing or anything like that was required. But through this acquisition, right, we're holding a demonstration on December 15; so it gave us the ability to truly demonstrate the full architecture all the way down to actual execution and commanding of a ground asset autonomously, which we felt was important and justified the investment. It lets us do a bit of R&D and confirm that the complete system will function under our own control; now, having said all that, are we partnering with other people? Yes, we are. I don't believe we need to fully vertically integrate across every single platform that might exist, whether that's surface vessels, underwater vessels, et cetera. But for us to understand that complete ecosystem and have confidence that it works and is turnkey ready to essentially proliferate across all those systems, that was worth having our own capability for at least one system. Hopefully that provides more insight.

Perfect. Yeah, that's great. Thanks, guys. I'll jump back in the queue.

Hi. Good afternoon. For my first question, it sounded like Senator Kennedy on the Senate floor yesterday was talking about at least $200 billion in reconciliation. If they push that $17.5 billion in Golden Dome funds into the reconciliation, how would that flow through to some of the IDIQs you have already won?