Guidance and EPS Growth
Q: What drove changes in your guidance for the second half?
A: We are being prudent in our guidance, still expecting a 13% year-over-year increase in EPS. There are no significant changes in the background; we feel it's a good result and a positive outlook.

People & Places Margins
Q: Can you discuss the sustainability of high margins in People & Places Solutions?
A: The 15.3% margin in P&PS this quarter is a record high. While we don't expect to hit this level every quarter due to mix factors, we're feeling better about our margin profile than last quarter and expect attractive numbers for the year.

Growth in Life Sciences and Semiconductors
Q: How are life sciences and semiconductor markets impacting your business?
A: In life sciences, we're working with the two biggest companies in the GLP-1 obesity drug space, representing over 50% of their capital investments. Oncology advances and contract manufacturing are also driving growth. In semiconductors, the CHIPS Act funding is accelerating projects, with phase 2 and test and assembly facilities coming to the U.S. Data centers are creating opportunities in power, cooling, and water due to AI demands.

CMS Outlook and Program Losses
Q: How do program losses affect your CMS revenue growth outlook?
A: A sizable program loss will impact CMS in Q3 and Q4, resulting in flat revenue growth instead of mid-single digits. However, operational efficiencies have led to double-digit bottom line growth this quarter, with operating margins at their highest. We expect incremental growth in 2025.

Backlog Growth in People & Places
Q: Can you elaborate on backlog growth in People & Places Solutions?
A: The P&PS backlog is at a record level since forming the segment five years ago. Our book-to-bill remains over 1x, and we anticipate acceleration in backlog growth in the second half with expected awards, some already received.

PFAS Legislation Opportunities
Q: How does PFAS legislation impact your business opportunities?
A: PFAS remediation represents a $200 billion opportunity over 25 years across multiple end markets. Within the DoD, it's generating $75–100 million in annual revenue for us. The bigger opportunity lies in drinking water, where PFAS consulting is growing as part of water projects, serving as a catalyst for scope growth on existing work.

IIJA Funding Ramp-Up
Q: What are your expectations for the IIJA funding ramp and its impact?
A: IIJA funding ramp is still trending towards 2026–2027, possibly extended due to a later start. Current and anticipated awards are being catalyzed by IIJA, driving pipeline growth, especially in transportation.

PA Consulting Outlook
Q: What's driving growth and margins in PA Consulting?
A: PA Consulting's backlog is up 8% year-over-year, with momentum from collaborative opportunities. The team is delivering 20%+ margins in the back half of the year. While growth is not substantial, we expect solid execution and are well-positioned, especially in the U.K. market.

Exposure to NEOM Project in Saudi Arabia
Q: How does the scaling back of NEOM project affect your business?
A: Despite the scaling back of NEOM, our work continues on schedule and has not abated. Our exposure in Saudi Arabia is diversified across infrastructure, transportation, and water, including the major expansion of the new Riyadh Airport.

Corporate Unallocated Costs Post Separation
Q: When do you expect corporate unallocated costs to decrease post separation?
A: The current run rate of $58 million will continue through the balance of the year. We expect a step-down to $50 million post separation in the first quarter of fiscal 2025.