Kevin Wilson

Kevin Wilson asked for more details on Qualitrol's award with a large cloud provider, inquiring if it represents a new customer type and if more data center-specific business is expected. He also sought color on the Tektronix AI robotics highlight, the market share opportunity in validation, and customer adoption of new product platforms.

Answer

Tami Newcombe, President and CEO, confirmed that Qualitrol's win with a hyperscaler for data center grid infrastructure is a new customer space, distinct from traditional utilities and transformer OEMs, and is an area of increasing focus. For Tektronix, she explained the AI robotics win signifies broader opportunities as AI moves to the edge. The MP5000 platform, Tektronix's first purpose-built solution for automated testing, has been well-received and represents a greenfield growth opportunity, though its ramp-up will take time due to a new go-to-market strategy with system integrators.

Kevin Wilson asked for more details on the Qualitrol award with a large cloud provider, questioning if this type of customer win is a first for Qualitrol and if more data center-specific business is expected beyond general transmission infrastructure. He also inquired about the Tektronix AI robotics highlight, the market share opportunity in validation, and the customer adoption of new product and platform introductions like the MP5000.

Answer

Tami Newcombe (President and CEO) confirmed that the Qualitrol win with a hyperscaler building data center grid infrastructure represents a new and ramping customer space, distinct from traditional utilities and transformer OEMs. For Tektronix, she explained the AI robotics win signifies a broader trend of AI moving to the edge, creating new electronic test and measurement opportunities. The MP5000 platform, Tektronix's first purpose-built solution for automated testing, has been well-received and is seen as a greenfield growth opportunity, though its ramp-up will take time due to a new go-to-market strategy with system integrators.

Kevin Wilson asked about United Rentals' cold start strategy, noting the expectation of 40 specialty cold starts in 2026, down from 60 in 2025, and inquired about the overall footprint strategy and organic growth opportunities within specialty verticals. He also followed up on the revenue guidance, asking if local market demand is still considered flattish and about the level of visibility.

Answer

Matthew Flannery, President and Chief Executive Officer, clarified that cold start numbers are flexible based on real estate and talent availability, primarily focusing on expanding specialty offerings and filling white space. He stated that organic growth is expected from large projects and specialty, with strong performance in power and non-residential construction (even excluding data centers), while residential and petrochem are lagging. Mr. Flannery confirmed that local market demand is expected to remain flattish, with growth primarily driven by the large project pipeline, which is at a record high.

Kevin Wilson asked about United Rentals' strategy for specialty cold starts, noting the planned 40 in 2026 is down from 60 in 2025, and the broader footprint expansion. He also inquired about the strongest opportunities for organic growth, target specialty verticals, and the assumption for local market demand embedded in the 2026 revenue guidance.

Answer

CEO Matthew Flannery clarified that the cold start numbers aren't strictly calendar-driven, with the 2025 number exceeding the original target due to pipeline acceleration; the focus remains on expanding the one-stop shop in specialty. He stated that organic growth is driven by large projects and specialty, with strong performance in power and non-residential construction (even excluding data centers), while residential and petrochem are lagging. He confirmed that the 2026 guidance assumes local market demand will remain 'flattish,' with growth primarily from large projects.

Kevin Wilson from Truist Securities, on behalf of Jamie Cook, inquired about specific trends in the Environmental business versus the Water business. He also asked for an update on the PA Consulting investment ahead of the March 2026 deadline.

Answer

Chair & CEO Bob Pragada stated that the Water sector is outperforming its long-term targets, while the Environmental business saw a near-term slowdown but is expected to inflect positively. Regarding PA Consulting, he described the dialogue with partners as thoughtful and positive, focused on structuring the partnership to unlock more future value.

Kevin Wilson, on for Jamie Cook, asked about the potential risks of U.S. foreign policy, such as tariffs, on international projects and win rates. He also requested an update on the expected level and cadence of restructuring costs for the year.

Answer

Chair and CEO Bob Pragada stated they view potential trade policy shifts as an opportunity to act as trusted supply chain advisers for clients, rather than a direct threat. CFO Venk Nathamuni confirmed they are maintaining the full-year restructuring cost guidance of $75 million to $95 million, expecting a fairly steady cadence for the rest of the fiscal year.

Kevin Wilson, on behalf of Jamie Cook of Truist Securities, asked for more detail on the company's M&A strategy, specifically regarding potential non-vision adjacencies. He also inquired if the Q3 medical lab automation licensing arrangement was a one-off opportunity or indicative of a broader strategy.

Answer

CEO Matt Moschner reiterated a high bar for M&A, focusing on strategic fit and value creation, and noted the Moritex deal provides confidence in executing larger transactions. Regarding the lab automation deal, Moschner explained it was a strategic resource allocation to a partner with better scale in a niche market. CFO Dennis Fehr added it represents a doubling-down on their core direct sales strategy, not a shift away from it.

Kevin Wilson of Truist Securities asked for details on the newly disclosed packaging end market, including penetration opportunities and competitive dynamics, and inquired about the performance and associated OpEx of the emerging customer sales force initiative.

Answer

CEO Robert Willett explained that the packaging market, which includes consumer goods and healthcare, is a broad, less cyclical opportunity well-suited for Cognex's easier-to-use technology and expanded sales force. Regarding the sales initiative, Willett noted it is now integrated into the main sales team and successfully added 3,000 new customers last year. CFO Dennis Fehr added that future investment in sales capacity will be mindful of the macro environment, with a focus on overall OpEx efficiency.

Kevin Wilson inquired about the level of investment required for the new Water & Environment Advisory business and asked for AECOM's perspective on the potential for M&A and consolidation within the infrastructure services industry.

Answer

CFO Gaurav Kapoor described the investment as organic, running through the P&L, and already factored into guidance, noting it offers a higher ROI (40%+) than expensive M&A. CEO Troy Rudd stated that AECOM sees no need for large-scale M&A, given its #1 market positions and focus on organic growth. He argued that deploying capital for share repurchases and organic initiatives that compound EPS growth is a superior strategy, especially as management time is a scarce resource.