Teledyne Technologies Incorporated Jefferies Global Industrials Conference 2026

Yeah, sure. Again, Jason VanWees, Vice Chairman. I have been at Teledyne a little over 27 years, as of last month. Principally, I am responsible for M&A, capital allocation, I suppose, if you would like. Sometimes people are left thinking that Teledyne is very complicated, and some of that is my fault because I am willing to tell everybody everything we do in every market we serve, and vertical, and things like that, which really is not the case. I mean, it may sound counterintuitive after 75 acquisitions that we are actually a simpler company, but we are, because virtually everything we have bought has been a double-down acquisition in a market we are already in or a customer base we already serve, circa 1999, when I joined. Certain things have gotten larger and more material, but thematically, what we build, like we said, principally, we are a sensor business.

That is where most of our companies grew out of, imaging sensors, acoustic sensors. Over time, though, we have grown in certain markets to be vertically integrated, where we use our own sensors into cameras for applications ranging from machine vision, semiconductor wafer inspection, satellite imaging, things that look down, like Space Development Agency programs or big science things that look out. James Webb Space Telescope, Hubble Space Telescope, Nancy Grace Roman Space Telescope just launched recently. But again, we are still a merchant supplier of all those devices to any other market participants, sometimes our competitors, sometimes not. But again, in areas like unmanned systems, unmanned air, unmanned ground, unmanned subsea, we are vertically integrated and are a complete system provider. But generally speaking, Teledyne is a sensor and subsystem company that in a few areas is vertically integrated and a system-level company.

Jefferies has covered us out of A&D for more than two decades, and I think that is still a big part of our business. It is about 35% of our sales is defense. Commercial aerospace, relatively small, but a good 5%. We are still, single largest end market is aerospace and defense, but that leaves another 60% of the company that is really high reliability industrial markets. Those range from things like medical, sometimes commercial space imaging, someone like a Planet Labs as opposed to a Space Development Agency, as an example. Similar type markets, but they tend to be commercial rather. Again, high reliability, not commoditized. Those are things that we try to avoid. Most of the markets that we are in tend to be a little bit niche-y, as one would say, for the proverbial highly engineered product. Most of the competition are oligopolies.

Sometimes we're number one, sometimes we're number two, maybe occasionally number three, but that's really Teledyne at the highest level, I would say.

Well, it's a little bit of both. Again, the backlog has continued to grow. I think we've actually had 11 consecutive quarters of book-to-bill north of one. Yeah, on an absolute basis, Q2 was the highest, both in terms of the ratio and in terms of the absolute order inflow to get backlog of about $5 billion. Funded backlog, in the defense world, we don't report contract ceiling, things like that. It's just fully funded orders in backlog. But yeah, you're right. It was 9% organic growth. In the digital imaging segment, it was 11.9%, so that was the fastest. But in the other segments, it was good too, mid to high single digit, to get to the 9% overall. Generally speaking, in the quarter, the defense business, which again, like I said, is about a third of our sales, that was double digits for the company.

Most of the high reliability industrial was maybe at worst low single digit. Most of them were mid single digit, a few pockets a little bit stronger, but that's why the average organic was 9%. Again, you had a third of the company, nice double-digit growth, probably more like 12% than 10% on that third. That's defense. But then you had a lot of 3%, 5%, 7% on the commercial industrial business. So it was a good quarter.

No, it is more the latter. Most of the backlog-driven businesses, when we talk about the $5 billion of backlog, the 11 consecutive quarters of book-to-bill north of one, that is driven by the backlog businesses, which is about half the company, but at least a little less than half the company that is intra-quarter book and ship. The orders are usually one because you get the order, you ship it. You could grow, you could contract, but it does not really build or consume backlog. So maybe there is a little bit of conservatism, and we did mention on the call that maybe there is $30 million, $40 million of upside based on trends as of July. To split hairs, I think the organic guidance was maybe closer to six, then the full year total growth closer to seven because we have a few little bolt-on acquisitions.

But I acknowledge that, yeah, there is probably a little bit upside to that, just the way things are even trending in July. The sell side is a little bit higher than the guidance by just about that $30 million to $40 million, but still it is accurate. I would say generally we have been conservative. We try our best to underpromise and overdeliver. I think in the 27 years, 100-plus quarters I have been there, we have probably missed our own guidance I think three times. So it has been a pretty good record. Again, it is not overly conservative, but I think we have tried to do a reasonable job of not guiding at the midpoint, say.

That was- Maybe a lower quartile or something like that.