Good day, ladies and gentlemen, and welcome to the Medpace Holdings, Inc. First Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question, please press star one one on your phone. If your question has been answered and you'd like to remove yourself from the queue, simply press star one one again. As a reminder, this call is being recorded. I would now like to introduce your host for today's conference call, Lauren Morris, Medpace's Director of Investor Relations. You may begin.

Good morning, and thank you for joining Medpace Holdings, Inc.'s first quarter 2025 earnings conference call. Also on the call today is our CEO, August Troendle, our President, Jesse Geiger, and our CFO, Kevin Brady. Before we begin, I would like to remind you that our remarks and responses to your questions during this teleconference may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve inherent assumptions with known and unknown risks and uncertainties as well as other important factors that could cause actual results to differ materially from our current expectations. These factors are discussed in our Form 10-Ks and other filings with the SEC. Please note that we assume no obligation to update forward-looking statements even if estimates change. Accordingly, you should not rely on any of today's forward-looking statements as representing our views as of any date after today. During this call, we will also be referring to certain non-GAAP financial measures. These non-GAAP measures are not superior to or a replacement for the comparable GAAP measures, but we believe these measures help investors gain a more complete understanding of results. A reconciliation of such non-GAAP financial measures to the most directly comparable GAAP measures is available in the earnings release and earnings call presentation slides provided in connection with today's call. The slides are available in the Investor Relations section of our website at medpace.com. With that, I would now like to turn the call over to August Troendle.

Good day, everyone. Our quarter one net awards were down sequentially and year over year, with a net book-to-bill ratio of 0.90. This was primarily a reflection of high pipeline cancellations in prior quarters as previously discussed. Backlog cancellations were modestly elevated in Q1, but pre-backlog cancellations were worse, impacting Q1 and future projected backlog net awards. RFP flow was strong in Q1, but quality has been variable and decisions are slowing. We continue to see a path to improved backlog growth reflected in book-to-bill ratios above 1.15 in Q3 and Q4. However, this will depend upon moderating cancellations and an improved business climate. Jesse will now provide comments on the quarter.

Thank you, and good morning, everyone. Revenue for the first quarter of 2025 was $558.6 million, which represents a year-over-year increase of 9.3%. Net new business awards entering backlog in the first quarter decreased 18.8% from the prior year to $500 million, resulting in a 0.9 net book-to-bill. Ending backlog as of March 31, 2025, was approximately $2.8 billion, a decrease of 2.1% from the prior year. We project that approximately $1.61 billion of backlog will convert to revenue in the next twelve months, and backlog conversion in the first quarter was 19.2% of beginning backlog. With that, I will turn the call over to Kevin to review our financial performance in more detail and discuss our 2025 guidance.

Thank you, Jesse, and good morning to everyone listening in. As Jesse mentioned, revenue was $558.6 million in the first quarter of 2025. This represented a year-over-year increase of 9.3%. EBITDA of $118.6 million increased 2.6% compared to $115.7 million in the first quarter of 2024. EBITDA margin for the first quarter was 21.2% compared to 22.6% in the prior year period. The decrease in EBITDA margin compared to the prior year period was impacted by employee-related costs and foreign exchange behind the weakening of the US dollar in the quarter. In the first quarter of 2025, net income of $114.6 million increased 11.7% compared to net income of $102.6 million in the prior year period. Net income growth above EBITDA growth was primarily driven by a lower effective tax rate from option exercises in the quarter and higher interest income. Net income per diluted share for the quarter was $3.67, compared to $3.20 in the prior year period. Regarding customer concentration, our top five and top ten customers represented roughly 22% and 32%, respectively, of our first quarter 2025 revenue. In the first quarter, we generated $125.8 million in cash flow from operating activities, and our net days sales outstanding was negative 67.8 days. As of March 31, 2025, we had $441.4 million in cash. During the first quarter, we repurchased approximately 1.19 million shares or $389.8 million. At the end of the quarter, we had $344.8 million remaining under our share repurchase authorization program. Moving now to our updated guidance for 2025. Full-year 2025 total revenue is now expected in the range of $2.14 billion to $2.24 billion, representing growth of 1.5% to 6.2% over 2024 total revenue of $2.11 billion. Our 2025 EBITDA is expected in the range of $462 million to $492 million, representing a decline of 3.8% to growth of 2.5% compared to EBITDA of $480.2 million in 2024. We forecast 2025 net income in the range of $378 million to $402 million. This guidance assumes a full-year 2025 effective tax rate of 15.5% to 16.5%, interest income of $15.8 million, and 30.8 million diluted weighted average shares outstanding for 2025. There are no additional share repurchases reflected in our guidance. Earnings per diluted share is now expected to be in the range of $12.26 to $13.04. Guidance is based on foreign exchange rates as of March 31, 2025. With that, I will turn the call back over to the operator so we can take your questions.

Thank you.

As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Our first question will come from David Windley with Jefferies. Your line is open.

Hi. Thanks for taking my questions. Good morning. August, your comment, maybe August and Jesse, your comments around RFPs and quality of RFPs. I wanted to explore. We've, in some of our discussions, been told that biotechs and kind of your target client audience are inviting more CROs into bid situations and, in some cases, taking a larger number of CROs, maybe by one or two, but a larger number of CROs forward into bid defense. And so, and maybe, you know, implied fishing for lower prices. Wanted to get you to flesh out, if you would, your quality comments. Are you seeing these kinds of trends? Are you seeing more price competition? And is that a little bit of what you mean when you say the quality is a little more mixed? Thanks.

Yeah. Yeah, Dave. That is true. Anytime there's a slowdown in the industry, there tends to be more price competition, more broader look at CROs. But a big factor is unfunded projects that they're looking toward funding and getting proposals so that they can bring that back to try to make a story for moving a product forward. Rather than having, you know, some assets to move the product forward to start with. But, yeah, they do tend to get more churn and a larger number of CROs participating in particular bids. So RFP numbers can go up, but that just means they've doubled the number of average, you know, average number of CROs inviting to each RFP, and so everyone sees an increase in RFPs. So, yeah, I do think that's a good part of it. But the more concerning issue for me is the likelihood of funding and the type of asset and where they are in their funding cycle and how far out the project is. And what stage it is, that leads to a worsening in the quality of the RFPs.

Thanks for that. And, August, your comments about, you know, still depending on environment. I didn't get your exact words, but kind of depending on environment, they'll believe you have the potential to track their 1.15 book-to-bill in the second half. I noted your comments about backlog cancellations, but pre-backlog cancellations were worse. I guess I would love for you to flesh out how, you know, what would be required, I guess, to achieve that. Because in, say, middle of last year, when you talked about that intensification of pre-backlog cancellations, that was essentially what seemed to cement your view that you wouldn't be able to get to a higher book-to-bill, you know, say, later last year. And maybe early this year. How is that different now?

Sure. Yeah. The pipeline cancellations, the pre-backlog cancellations, particularly, have narrowed our options quite a bit. And, you know, limited the possible booking levels in the next few quarters. But, you know, you realize we have pretty good visibility in the opportunities that could, you know, most of the opportunities that could convert into backlog in the next few quarters. You know, they're kind of known to us as opportunities, you know, at whatever stage. And, you know, they're sufficient to get us there. If cancellations come back to a, you know, nice reasonable range. And we don't see, you know, this across the pipeline kind of elevated level. And things continue to move forward. And we've seen a slowing in decisions on RFPs. And, you know, once in a while, you also have delays in project starts, due to funding or for other reasons. And, you know, we need the projects to move into operational execution, and recognition and backlog, and we need to avoid large cancellations. So our path there has narrowed quite a bit. But we still see the re and, you know, it's not just a hypothetical far off, you know, I'm saying it's still possible, but, you know, it's highly improbable. We still have, you know, a reasonable path to get there. If cancellations, a bit, you know, come back quite a bit.

Thank you for that. I'll leave it at that. Thank you.

And our next question will come from Max Smock with William Blair. Your line is open.

Hi. Good morning. Thanks for taking my question. August, you mentioned thinking to get back to 1.15 book-to-bill in the back half of the year. If you get that improved climate, I guess my question would be, what do you think bookings look like if you don't get that improved climate? And then in that scenario where we assume even a stable environment from here, how much downside is there to the top line this year? And then what would that imply for top line growth in 2026? Thank you.

How much risk is it to top line this year? You mean bookings, or you're talking about to revenue, you know, to, I guess, more second half.

Yeah. More impact on revenue in the second half. I guess three parts. Right? If the environment's stable from here, what do bookings look like in the back half of the year? How much downside is there to how you're thinking about revenue in the back half of the year and your guide for the year? And then what does that all imply for top line growth in 2026?

Yeah. Well, you know, that's a kind of a difficult hypothetical. You know, what kind of downside is there? You know, that depends on how bad the environment gets. You know? If cancellations continue kind of the way they have of recent past and particularly this, you know, past quarter and some of the quarters last year, you know, we're gonna be in the same kind of, you know, place we've been, you know, somewhere around one, I guess. I think that's kind of the downside. But we still have, you know, opportunities to, again, you know, paths toward getting to, you know, 1.15. Revenue in the second half is, you know, pretty much locked in. You know, that's kind of a different issue because that's a different cancellation. It would be a more later stage cancellation to, you know, knock our revenue off. Now, that's possible and of course, we continue to have clients with funding difficulties that, you know, we have to stop work on. And or, you know, or cancel the project because of work. So there's still some risk to second half revenue, but you know, most of that is pretty locked in. And I really don't have a model for 2026, so I, you know, I can't go there yet. You know, and the environment is, you know, it's just too early to really talk about 2026. You know, revenue impact of poor bookings through this year.

Understood. And maybe framing it as downside scenario wasn't right with you. I was thinking more, like, if things stay the same, stay the way they are today and you don't get that improved climate, and just to confirm, if that is the case and we're talking book-to-bill kind of around 1.0 in the back half of the year versus, you know, if you do get that improvement you're still thinking you can get to 1.15.

Correct.

Okay. That's helpful. Thank you. And then maybe as a follow-up, there's been a lot of headlines recently around just out of the FDA, and there's one over the weekend from an interview where they were saying, going to require less clinical trials in certain areas going forward the mechanism of action makes sense and efficient unmet need. Do you have any sense or can you provide us any detail around what your rare disease exposure looks like and just how you're thinking about, you know, this kind of discussion from the FDA and the talk about doing less trials and some of these indications moving forward. Is that a long-term structural headwind for Medpace Holdings, Inc. or for the CRO industry as a whole?

I don't know. That's pretty hypothetical. You know, you make drugs easier to develop and you tend to get more development. So I, you know, certainly, you know, if you took away the need for significant trials in an area, you know, you're gonna, that does have an impact. But, you know, I think that's very hypothetical when I know, rare disease, you know, and it kind of depends on how you define it, you know, is certainly a meaningful part of our business. But I really don't make much of the, you know, I think it's great to, you know, have, you know, the trial requirements be, you know, proportional to the, you know, the serious and, you know, needs of society for drugs and, you know, you gotta put you have the right balance. You know, we want effective drugs, but we want them developed at a reasonable cost. And, you know, that's just kind of the trade-offs, and I don't really see it as a risk to our industry from that.

Got it. Thank you.

And our next question comes from Ann Hynes with Mizuho. Your line is open.

Hi. Good morning. Maybe talk about cancellations a little bit more. Can you remind us what your cancellation rate is? I don't think you said what it was this quarter versus what it was last quarter and what it is versus historical. And maybe just the type of trials that you're seeing canceled. Is it widespread? Is it specific customers? Any incremental detail on cancellations would be very helpful. Thanks.

Sure. Yeah. You didn't hear it because we didn't say it because we don't disclose it. So we just don't, you know, we don't provide cancellation rate. You know? And the cancellations have been pretty broad, but largely centered around funding issues. And, you know, you can call it reprioritization. And other things, and, you know, that's certainly part of it. And there are certainly drugs that have had, you know, significant safety signals or other, you know, failures of, you know, trials that have impacted the development of the program. But funding has been at least a part of a good portion of the cancellations, but I can't sort out a different, you know, therapeutic area or anything like that. It's kind of across the board.

Great. And then my next question is just on share repurchase. Obviously, stocks are down year to date. It's gonna be down a little bit more today. And there's no incremental share repurchase in your guidance. I guess what would trigger Medpace Holdings, Inc. to get more aggressive on share repurchases?

Yeah. I mean, Ann, this is Kevin. We'll continue to take an opportunistic approach as we have in the last couple of quarters. And so we'll continue to look for those opportunities to do that. And we'll kind of see how we're able to execute. As you saw, we did increase the board authorization on share repurchases, and so we'll look for opportunities to continue to do that.

Thank you.

And our next question comes from Dan Leonard with UBS. Your line is open.

Thank you. I have a question on that small biopharma exposure that you report at 80% of your revenue. Do you have any sense for how much of that is negative enterprise value of biotech? And are you concerned at all that some of these biotechs that have negative enterprise value might just start to close up shop and return the cash?

I see. Do you have any proportions on that? You know, we continue to see companies, you know, fail. I don't know how many, you know, that have, you know, if the drugs failed and they're not doing anything and they close up shop, I guess, you know, who cares? They don't have a viable drug to go forward with. But, you know, certainly, funding difficulties is a bigger issue than drug failures and closing up shop at the current time. Jesse, do you have any kind of metrics on that?

Yeah. I don't have anything on negative EV quantification. The things we do quantify, we'll look at, you know, what percentage is public versus private, fully funded companies and kind of what percentage is partnered with large pharma, but we're not tracking and reporting, you know, EV values.

Got it. It doesn't sound like there's a high level of concern of yours independent from the broader funding environment anyway. Is that fair?

Yeah. I think companies have too much money. And having to return it to investors is not our problem.

And then my follow-up question, which is coming up a lot in the investment community, August, do you have any sense on whether all the turnover at the FDA is impacting your client discussions at all and making them incrementally behave differently or more about the future?

I think it makes everybody worried about the future. I'm not convinced there's any kind of, you know, evidence that, you know, there's been delays or problems to date or changing behavior. But, you know, we'll have to see. I think it's too early.

And our next question comes from Eric Coldwell with Baird. Your line is open.

Thanks very much. I wanted to hit on the other side of growth. You've got bookings. You also have backlog burn. Backlog burn was up pretty nicely year over year. It looks like the forecast must incorporate higher levels of backlog burn this year. I'm curious how much of that is a function of the lower backlog growth and the lower bookings, which, you know, naturally changes the denominator equation, but also were there unusual timing shifts in the burn rate of your backlog or project-specific items this quarter? Are there execution improvements that you're showing and maybe think are sustainable? We'd just like to get a better sense on the magnitude of this backlog burn reacceleration. How sustainable it is.

Yeah. Eric, this is Kevin. I mean, it's more a function of the acceleration in revenue in the quarter. So programs were progressing well, but you also saw an increase in the reimbursable cost activity. Right? That was a bit higher than what we had expected, so that's gonna influence it as well. And then it's the lower bookings that August talked about in his prepared remarks. It was coming in a bit soft. So it's not that we're changing execution or anything associated with that. I mean, programs continue to progress very nicely. It's more a reflection of the numerator and the denominator.

Okay. And then, Kevin, you know, last quarter on the call mid-February, you had, in response to one of my questions, you had suggested that you thought revenue would be more modest in the first quarter and then linearly progressing through the year. We got quite the opposite with over 9% revenue growth, but the rest of your targeted growth rates are lower. So what, you know, other than the near 10% growth in pass-throughs, what were the other dynamics in play? Or were you really thinking pass-throughs were gonna be down and instead they grew 10%? So maybe we didn't know what to model, but in your mind, that was the big delta here. I'm just, you know, they told us to start slowing growth revenue, and it was the opposite.

Yeah. I think the bigger influence was the reimbursable cost activity. Now having said that, your programs progressed probably a bit better than I had anticipated in the first quarter as well. But I think the bigger influence was the reimbursement.

And then my last question for this call, just I saw a little bit of headcount growth quarter over quarter, a little bit more year over year, but maybe a bit slower than I was originally anticipating, probably because of the lower bookings. But what is your new outlook on turnover, hiring, timing of hiring this year? I'm curious what your plans are at this point, what you'd like to do, and what you think is actually doable in the environment.

Yeah. Thanks, Eric. We did have a little bit of modest headcount growth in the first quarter. The turnover remains pretty good. And, you know, we're still targeting headcount growth this year. You know, likely around mid-single-digit.

And our next question comes from Charles Rhyee with TD Cohen. Your line is open.

Yeah. Thanks for taking the question. I just wanna go back a little bit when you're talking about, obviously, the funding issues with clients. Are you seeing any clients, you know, because we've heard in some instances where companies have been committed, have gotten funding, but then either their private equity or VC backers kind of maybe pulled back on some of those commitments. And so maybe some of the funding data we've seen over the last year or so may not actually materialize. Just curious if that is some of the dynamics you're seeing in some of clients potentially having some funding issues.

Sure. Yeah. I definitely think that's part of it. Often, clients represent to us that they've got funding arranged, they have commitments, they have, you know, whatever. You know, how strong is commitment? So, okay. Can I give have VCs and others having to choose between, you know, the winners and losers? Their portfolio. But it's where we are.

Yeah. Okay. And then maybe just, I know you're not disclosing sort of the cancellation rates, but can you give us a sense sort of maybe between pre-backlog cancellations and just cancellations out of backlog, sort of maybe the relative mix between the two and as you kind of, I know you guys said you kind of were looking at your pre-backlog kind of, you know, kind of expectations for the course of the year. You know, has that, I know you said it was higher, but was it really outside the realm that you expected, or was it just kind of, you know, kind of at the upper bounds of what you kind of thought could happen?

Yeah. I think I'd classify backlog cancellations kind of in that range. You know? But, you know, just outside of the range, kind of. But the pre-backlog cancellations were significantly worse and very high. So, you know, overall, it was a pretty high rate of pipeline cancellations.

Okay. Thanks. And, Jesse, maybe just real quickly, you talked about headcount. Would you say you're still on track for a mid to high digit growth, or is that really just now dependent on, you know, what we see in terms of the environment over the next couple of months?

Yeah. I would say, you know, at this moment, we're on track for mid-single-digit growth, but it will depend on how the environment unfolds. Things pick, you know, pick up, we'll accelerate more aggressive hiring.

And our next question comes from Mike Cherney with Leerink Partners. Your line is open.

Good morning. Thanks for taking the question. Maybe just to come at the cancellations question another way, both on the existing backlog and the pre-backlog. Is there anything you can tell us about cadence over the course of the quarter? Clearly, we can't, not only no one, you can't control the dynamics going on at play across the changeover in, but did you see any elevated activity maybe over the course into March given the uncertainty that's been created from the moving pieces across FDA?

Yeah. I'm not sure it had anything to do with, you know, movements at FDA. And I mean, I don't have the cadence in terms of month to month in front of me, but it didn't strike me as all back end or, you know, front end loaded. It was, you know, kind of across the board.

Okay. And then on the dynamics and the buildbacks towards an improved book-to-bill, you talked about their conditions in place to get back to 1.15. Is there anything your clients are telling you in terms of how they feel about achieving those conditions and what would be the comfort factors you're looking for in order to get back to those levels? You know, curious along those lines what the feedback is from the channel specifically.

Yeah. No. I have no, I don't think that's provided me any input. You know? I don't think anybody knows.

And our next question comes from Jalindra Singh with Truist. Your line is open.

Thank you, and good morning, and thanks for taking my questions. I just want to go back to revenue guidance rates for the year. You report this metric of amount of backlog expected to convert in the next twelve months. It has been around a little over $1.6 billion for the last few quarters. Have you seen any cancellation in that bucket recently? Because it seems you are implying that even if booking trends and book-to-bills remain at the current levels, first of the year, you still feel good about revenue outlook for the year. I'm wondering because it's you don't see much concern around that $1.6 billion amount of backlog conversion.

Yeah. This is Kevin. I mean, in terms of kind of reemphasizing what August said, we feel good about the 2025 guidance because we've got the programs in backlog and, you know, barring any, you know, acceleration in cancellations, we always see cancellations in that bucket. But as long as they stay relatively normal, we feel good about the revenue that's gonna come out of that bucket. Certainly, revenue is, or backlog has declined a little bit, and so that next twelve-month figure has come down a bit, but we feel good again about the guidance that we have out there on revenue.

Okay. And then my follow-up, I want to go back to David's question around biotech CRO landscape getting more competitive. I mean, historically, your pitch to biotech companies has been giving them more personalized focus, more personalized services. If some of your peers are restructuring their approach and going after this market more aggressively, how are you guys responding to that? Are you guys making any changes to your pitch or your approach as you go after these clients?

I don't think there's been a change in our competitive dynamics lately of any material. In fact, I, you know, everybody tries to give the clients individual attention. And there's been no change.

As a reminder to add a question, please press star one one on your telephone. Our next question comes from Justin Bowers with DB. Your line is open.

Hi. Good morning, everyone. Just a few follow-ups from what's been discussed. In terms of the programs progressing faster and the step up in Q1 revenue, is that, Kevin, is that more internal or external factors? Meaning, was it like execution on your end or is there a push, you know, get the data done faster? Just anything to call out the progression there.

Yeah. I mean, I would say there's nothing unusual. It's just that the programs, the active programs that we have in backlog just continue to progress very nicely. It's not to say that we've made any major internal changes. There's always pressure from sponsors to do things faster than we certainly do. What we can. But I would say there's no change internally as it relates to how we execute.

Okay. And then in terms of the cancellations, it sounds like most of that was concentrated or the elevation was around the prebooking. But in terms of the in-flight cancellations, was that elevated as well? And is that, you know, what trends are you seeing there? Is it more around futility or is it also funding related?

Yeah. I mean, the in-flight, you know, backlog cancellations tend to be a bit more related to drug performance, but the funding has been a big part of even our backlog cancellations. So it's a lot of both.

Okay. And then just in terms of one of the earlier questions on pricing pressure. Medpace Holdings, Inc. compared to the bigger guys has been, you know, pretty competitively priced. The pressure that you talked about, is that, are you seeing that from, you know, your mid-sized peers or are you also seeing that coming from some of the larger competitors that may be encroaching on your market space?

It's both. I mean, we're seeing competitive clients.

Yeah.

I'm sorry. Go ahead, Justin.

Yeah. I was saying it's from both, you know, both peers and, you know, and larger, you know, mid-sized and larger competitors. But also the pricing's influenced by just scarcity of funds as well. From the biotech perspective.

And our next question comes from David Windley with Jefferies. Your line is open.

Hi. Thanks for taking my follow-up. I have a few, but I'm only gonna ask one bigger one, which is around sites and the pass-through elements. So one of the things that we've heard anecdotally a fair amount is that the NIH grant funding, you know, what's called debate freeze, whatever, does have academic medical centers nervous about their situations. And while those funds probably fund investigator, you know, investigator-driven studies and not the type that you would directly run, but those funds probably also fund research infrastructure at these academic medical centers that could influence, you know, the throughput capabilities of the sites that you might use in studies. So with that having been said, I'm wondering about general site access, you know, recruitment rates, how much do you use academic medical centers, and to what extent are, how should we think about the pass-through, you know, increase in your revenue? Is that inflation-driven at the site? Is it just, you know, rebudgeting those of kind of quantity of consumption? And how much of that pass-through inflation that we saw in the first quarter is also driving the revenue for the year? Thank you.

Well, I think, David, that the threats and concern around, you know, academic funding at the, you know, these large university centers is not reflected in any things to date. You know, I mean, it's, you know, it's a theoretical issue for the future. I think today, the increase in pass-throughs, you know, of investigator costs as portions of budgets relate to a number of things, including, you know, complexity of the evaluations done at sites, but inflation and scarcity of patients. You know, and, you know, the pandemic, of course, had a huge impact on operations at centers and caused considerable cost increases and, you know, inflationary impact, you might say, at sites. But, you know, costs were, you know, driven up at sites and, you know, passed through, you know, to trials. So that's been the driver we've seen to date. You know, this shifting of possible overhead costs to on the, you know, sponsor-driven clinical trials, you know, commercial clinical trials, I, you know, maybe that'll happen. I don't know. But it's certainly not a factor in, you know, the current dynamic.

And on the revenue mix for the year, if we were to think about, you know, you raised by a little bit, is all of that raised pass-through? Is more than the raise pass-through? How should we think about the pass-through influence on revenue versus your prior expectation?

In the quarter, Dave?

I mean, I'm really thinking about the guidance for the year.

Yeah. I mean, it certainly was elevated in the quarter, but we kind of see that as being more timing related. I know we continue to feel that the cost that the pass-through pre-fund reimbursable cost is up to percentage, and they will be similar levels to what we saw in the back half of 2024. But as you know, it bounces around from quarter to quarter, but the expectation for the year is that it's somewhere similar to what we saw in the back half of 2024.

Yeah. But the question is that did it jump in, did the jump in our revenue? Is that in anticipation of jump in pass-through or direct leads this?

Yeah. Dave, as I said before, you know, we were not expecting pass-throughs to be this high in the quarter. So a big part of the revenue increase that we saw this quarter was influenced by the reimbursement activity.

I show no further questions at this time. I would now like to turn the call back over to Lauren for closing remarks.

Thank you all for joining us on today's call and for your interest in Medpace Holdings, Inc. We look forward to speaking with you again on our second quarter 2025 earnings call.

This concludes today's conference call. Thank you for participating. You may now disconnect.