Zach Cummins's questions to TELOS (TLS) leadership • Q2 2025
Question
Zach Cummins of B. Riley Securities inquired about the potential impact of recent DHS security line changes on TSA PreCheck demand, visibility into the DMDC program's revenue mix, and the company's capital allocation priorities, particularly M&A.
Answer
Executive Vice President of Security Solutions Mark Griffin stated they do not expect the DHS rule change to negatively affect TSA PreCheck enrollments, as speed remains the key benefit. Executive VP & CFO Mark Bendza noted that visibility into the DMDC mix is improving, with a weighting towards software, and that the primary capital allocation priority is using free cash flow for share buybacks, though they remain open to disciplined tuck-in or transformational M&A.