Question · Q2 2026
Louie D DiPalma inquired about the funding environment for the defense and intelligence business, specifically whether it is improving or expected to remain strained after the government shutdown, and sought clarification on the assumptions baked into the civilian guidance regarding the shutdown and potential further cuts. He also asked about the stabilization of the civil business from the September quarter relative to the June quarter.
Answer
Horacio Rozanski (Chairman, CEO and President) explained the bifurcation of the market, noting the challenging civil market with procurement delays and a stronger, though still frictional, national security environment with slower ramp-ups for new wins. Matt Calderone (EVP and CFO) clarified that the civil guidance assumes no further cuts but a competitive procurement environment, with the business feeling 'stabilized' after significant prior reductions. Kristine Anderson (EVP and COO) confirmed the civil business has been steady since earlier reductions but the environment remains slow, with productive conversations for future growth.