# EXPONENT INC (EXPO)

Informational only - not investment advice.

CIK: 0000851520
SIC: 8742 Services-Management Consulting Services
SIC breadcrumb: [Services](/division/I/) > [SIC Major Group 87](/major-group/87/) > [SIC 8742 Services-Management Consulting Services](/industry/8742/)
Latest 10-K filed: 2026-02-27
SEC page: https://www.sec.gov/edgar/browse/?CIK=851520
Filing source: https://www.sec.gov/Archives/edgar/data/851520/000119312526082508/expo-20260102.htm

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 582014000 | USD | 2026 | 2026-02-27 |
| Net income | 106009000 | USD | 2026 | 2026-02-27 |
| Assets | 777519000 | USD | 2026 | 2026-02-27 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-27. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000851520.json. Derived margins are computed from the extracted annual SEC facts.

| Metric | 2015 | 2016 | 2017 | 2018 | 2020 | 2021 | 2022 | 2023 | 2025 | 2026 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue | 304,704,000 | 315,076,000 | 347,799,000 | 379,523,000 | 417,199,000 | 466,269,000 | 513,293,000 | 536,766,000 | 558,514,000 | 582,014,000 |
| Net income | 40,701,000 | 47,480,000 | 41,305,000 | 72,254,000 | 82,460,000 | 101,202,000 | 102,330,000 | 100,339,000 | 109,002,000 | 106,009,000 |
| Operating income | 63,549,000 | 61,911,000 | 72,051,000 | 91,456,000 | 85,111,000 | 108,927,000 | 140,842,000 | 111,322,000 | 119,557,000 | 119,787,000 |
| Diluted EPS | 1.47 | 0.87 | 0.77 | 1.33 | 1.53 | 1.90 | 1.96 | 1.94 | 2.11 | 2.07 |
| Assets | 365,299,000 | 403,744,000 | 439,589,000 | 468,936,000 | 563,411,000 | 683,739,000 | 586,662,000 | 646,777,000 | 777,270,000 | 777,519,000 |
| Liabilities | 121,011,000 | 130,398,000 | 150,501,000 | 155,027,000 | 213,160,000 | 266,674,000 | 265,910,000 | 290,692,000 | 356,202,000 | 387,178,000 |
| Stockholders' equity | 244,288,000 | 273,346,000 | 289,088,000 | 313,909,000 | 350,251,000 | 417,065,000 | 320,752,000 | 356,085,000 | 421,068,000 | 390,341,000 |
| Cash and cash equivalents | 129,490,000 | 114,967,000 | 124,794,000 | 127,059,000 | 176,436,000 | 297,687,000 | 161,458,000 | 187,150,000 | 258,901,000 | 221,930,000 |
| Net margin | 13.36% | 15.07% | 11.88% | 19.04% | 19.77% | 21.70% | 19.94% | 18.69% | 19.52% | 18.21% |
| Operating margin | 20.86% | 19.65% | 20.72% | 24.10% | 20.40% | 23.36% | 27.44% | 20.74% | 21.41% | 20.58% |

## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-08. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000851520.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q2 | 2022-07-01 |  |  | 0.49 | reported discrete quarter |
| 2022-Q3 | 2022-09-30 |  |  | 0.47 | reported discrete quarter |
| 2023-Q1 | 2023-03-31 |  |  | 0.56 | reported discrete quarter |
| 2023-Q2 | 2023-03-31 |  | 29,124,000 |  | reported discrete quarter |
| 2023-Q2 | 2023-06-30 | 140,221,000 |  | 0.50 | reported discrete quarter |
| 2023-Q3 | 2023-09-29 | 133,336,000 | 24,538,000 | 0.48 | reported discrete quarter |
| 2023-Q4 | 2023-12-29 | 122,900,000 | 20,929,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-29 | 144,933,000 | 30,142,000 | 0.59 | reported discrete quarter |
| 2024-Q2 | 2024-03-29 |  | 30,142,000 |  | reported discrete quarter |
| 2024-Q2 | 2024-06-28 | 140,536,000 |  | 0.57 | reported discrete quarter |
| 2024-Q3 | 2024-09-27 | 136,279,000 | 26,044,000 | 0.50 | reported discrete quarter |
| 2024-Q4 | 2025-01-03 | 136,766,000 | 23,589,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-04-04 | 145,507,000 | 26,650,000 | 0.52 | reported discrete quarter |
| 2025-Q2 | 2025-04-04 |  | 26,650,000 |  | reported discrete quarter |
| 2025-Q2 | 2025-07-04 | 141,962,000 |  | 0.52 | reported discrete quarter |
| 2025-Q3 | 2025-10-03 | 147,120,000 | 28,044,000 | 0.55 | reported discrete quarter |
| 2025-Q4 | 2026-01-02 | 147,425,000 | 24,762,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-04-03 | 166,303,000 | 29,569,000 | 0.59 | reported discrete quarter |

## Macro Cross-References
- [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- [UNRATE](/indicator/UNRATE/): Unemployment Rate
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate
- [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private
- [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit
- [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit
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- [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food
- [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy
- [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter
- [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index
- [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
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- [CE16OV](/indicator/CE16OV/): Employment Level
- [ICSA](/indicator/ICSA/): Initial Claims
- [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm
- [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm
- [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product
- [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period
- [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index
- [TCU](/indicator/TCU/): Capacity Utilization: Total Index
- [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units
- [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade
- [PCE](/indicator/PCE/): Personal Consumption Expenditures
- [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income
- [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate
- [M2SL](/indicator/M2SL/): M2
- [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance
- [MSPUS](/indicator/MSPUS/): Median Sales Price of Houses Sold for the United States
- [HSN1F](/indicator/HSN1F/): New One Family Houses Sold: United States
- [RHORUSQ156N](/indicator/RHORUSQ156N/): Homeownership Rate in the United States
- [TTLCONS](/indicator/TTLCONS/): Total Construction Spending: Total Construction in the United States
- [RRVRUSQ156N](/indicator/RRVRUSQ156N/): Rental Vacancy Rate in the United States
- [TOTALSL](/indicator/TOTALSL/): Total Consumer Credit Owned and Securitized
- [REVOLSL](/indicator/REVOLSL/): Revolving Consumer Credit Owned and Securitized
- [DRCCLACBS](/indicator/DRCCLACBS/): Delinquency Rate on Credit Card Loans, All Commercial Banks
- [GDP](/indicator/GDP/): Gross Domestic Product
- [GPDI](/indicator/GPDI/): Gross Private Domestic Investment
- [GCE](/indicator/GCE/): Government Consumption Expenditures and Gross Investment
- [PCEC](/indicator/PCEC/): Personal Consumption Expenditures
- [NETEXP](/indicator/NETEXP/): Net Exports of Goods and Services
- [GFDEBTN](/indicator/GFDEBTN/): Federal Debt: Total Public Debt
- [GFDEGDQ188S](/indicator/GFDEGDQ188S/): Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- [FYFSD](/indicator/FYFSD/): Federal Surplus or Deficit
- [FGRECPT](/indicator/FGRECPT/): Federal Government Current Receipts
- [FGEXPND](/indicator/FGEXPND/): Federal Government: Current Expenditures
- [MANEMP](/indicator/MANEMP/): All Employees, Manufacturing
- [USCONS](/indicator/USCONS/): All Employees, Construction
- [USTRADE](/indicator/USTRADE/): All Employees, Retail Trade
- [USFIRE](/indicator/USFIRE/): All Employees, Financial Activities
- [USGOVT](/indicator/USGOVT/): All Employees, Government
- [AWHAETP](/indicator/AWHAETP/): Average Weekly Hours of All Employees, Total Private
- [DGORDER](/indicator/DGORDER/): Manufacturers' New Orders: Durable Goods
- [NEWORDER](/indicator/NEWORDER/): Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- [BUSINV](/indicator/BUSINV/): Total Business Inventories
- [EXPGS](/indicator/EXPGS/): Exports of Goods and Services
- [IMPGS](/indicator/IMPGS/): Imports of Goods and Services
- [IR](/indicator/IR/): Import Price Index (End Use): All Commodities
- [PPIFIS](/indicator/PPIFIS/): Producer Price Index by Commodity: Final Demand

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/851520/000119312526214572/expo-20260403.htm

Extracted between Part I Item 2 and the next Item 3/4 or Part II heading after HTML sanitization.
Confidence: high
Filing date: 2026-05-08
Report date: 2026-04-03

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto included herein and with our audited consolidated financial statements and notes thereto for the fiscal year ended January 2, 2026, which are contained in our fiscal 2025 Annual Report on Form 10-K, which was filed with the U.S. Securities and Exchange Commission on February 27, 2026 (our “2025 Annual Report”).

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains certain “forward-looking” statements (as such term is defined in the Private Securities Litigation Reform Act of 1995, and the rules promulgated pursuant to the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended) that are based on the beliefs of our management, as well as assumptions made by and information currently available to our management. Such forward-looking statements are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. When used in this document, the words “intend,” “anticipate,” “believe,” “estimate,” “expect” and similar expressions, as they relate to us or our management, identify such forward-looking statements. Such statements reflect the current views of us or our management with respect to future events and are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results, performance, or achievements could differ materially from those expressed in, or implied by, any such forward-looking statements. Factors that could cause or contribute to such material differences include the possibility that the demand for our services may decline as a result of changes in general and industry specific economic conditions, the timing of engagements for our services, the effects of competitive services and pricing, the absence of backlog related to our business, our ability to attract and retain key employees, the effect of tort reform and government regulation on our business and liabilities resulting from claims made against us. Additional risks and uncertainties are discussed in our 2025 Annual Report under the heading “Risk Factors” and elsewhere in this report. The inclusion of such forward-looking information should not be regarded as a representation by the Company or any other person that the future events, plans, or expectations we contemplated will be achieved. Due to such uncertainties and risks, you are warned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. We do not intend to release publicly any updates or revisions to any such forward-looking statements.

Business Overview

Exponent, Inc. is an engineering and scientific consulting firm providing solutions to complex problems. Our interdisciplinary organization of scientists, engineers, and business consultants draws from more than 90 technical disciplines to solve the most pressing and complicated challenges facing stakeholders today. The firm leverages over 55 years of experience in analyzing accidents and failures to advise clients as they innovate their technologically complex products and processes, ensure the safety and health of their users, and address the challenges of sustainability.

CRITICAL ACCOUNTING ESTIMATES

There have been no significant changes in our critical accounting estimates during the three months ended April 3, 2026, as compared to the critical accounting estimates disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2025 Annual Report.

RESULTS OF CONSOLIDATED OPERATIONS

Executive Summary

Revenues for the first quarter of 2026 increased 14% to $166,303,000 as compared to $145,507,000 during the same period last year. Revenues before reimbursements for the first quarter of 2026 increased 10% to $151,817,000 as compared to $137,437,000 during the same period last year. Revenue growth was driven by proactive engagements, including user research studies for consumer electronics clients integrating artificial intelligence into their devices, as well as risk management work for utility clients evaluating asset performance under extreme weather conditions. Reactive engagements also contributed to our growth, with increased dispute-related and failure analysis demand across construction projects, energy facilities, and medical devices.

- 19 -

Net income increased 11% to $29,569,000 during the first quarter of 2026 as compared to $26,650,000 during the same period last year. Diluted earnings per share increased to $0.59 per share during the first quarter of 2026 as compared to $0.52 during the same period last year. During the first quarter of 2026, we realized a negative tax impact associated with stock-based awards of $896,000 as compared to a negative tax impact of $469,000 during the same period last year. The change in the tax impact associated with stock-based awards was due to the change in the difference of the value of our common stock between the grant date and the release date for the restricted stock units released during the first quarter of 2026 as compared to the first quarter of 2025.

We remain focused on building our world-class engineering and scientific team to position us at the forefront of innovation and meet the ever-changing needs of our clients and the market. We also remain focused on capitalizing on emerging growth areas, managing other operating expenses, generating cash from operations, maintaining a strong balance sheet and undertaking activities such as share repurchases and dividends to enhance stockholder value.

Overview of the Three Months Ended April 3, 2026

During the first quarter of 2026, billable hours increased 6% to 399,000 as compared to 376,000 during the same period last year. Our utilization increased 1% to 76% as compared to 75% during the same period last year. Technical full-time equivalent employees increased 5% to 1,013 during the first quarter of 2026 as compared to 966 during the same period last year.

Three Months Ended April 3, 2026 compared to Three Months Ended April 4, 2025

Revenues

Three Months Ended

(in thousands, except percentages)

April 3,

2026

April 4,

2025

Percent

Change

Engineering and Other Scientific

$

141,412

$

122,135

15.8

%

Percentage of total revenues

85.0

%

83.9

%

Environmental and Health

24,891

23,372

6.5

%

Percentage of total revenues

15.0

%

16.1

%

Total revenues

$

166,303

$

145,507

14.3

%

The increase in revenues for our Engineering and Other Scientific segment was due to an increase in billable hours and an increase in billing rates. Growth during the quarter was primarily driven by user research studies in consumer electronics and risk management in the utilities sector, along with reactive engagements in the energy and life sciences sectors. During the first quarter of 2026, billable hours for this segment increased by 9% to 327,000 as compared to 300,000 during the same period last year. Utilization for this segment increased to 77% during the first quarter of 2026 as compared to 76% during the same period last year. Technical full-time equivalent employees in this segment increased 7% to 814 during the first quarter of 2026 as compared to 762 for the same period last year.

The increase in revenues for our Environmental and Health segment was due to an increase in billing rates partially offset by a decrease in billable hours. Growth in this segment was primarily driven by regulatory consulting in the chemical industry. During the first quarter of 2026, billable hours for this segment decreased by 5% to 72,000 as compared to 76,000 during the same period last year. Utilization in this segment decreased to 69% during the first quarter of 2026 as compared to 72% during the same period last year. Technical full-time equivalent employees in this segment decreased 2% to 199 during the first quarter of 2026 as compared to 204 during the same period last year.

Compensation and Related Expenses

Three Months Ended

(in thousands, except percentages)

April 3,

2026

April 4,

2025

Percent

Change

Compensation and related expenses

$

91,409

$

75,903

20.4

%

Percentage of total revenues

55.0

%

52.2

%

- 20 -

The increase in compensation and related expenses during the first quarter of 2026 was due to an increase in payroll, an increase in bonuses and the change in the value of assets associated with our deferred compensation plan. During the first quarter of 2026, payroll expense increased by $4,158,00 due to an increase in technical full-time equivalent employees and the impact of annual salary increases. During the first quarter of 2026, bonus expense increased by $2,938,000 due to a corresponding increase in our bonus pool which is 33% of income before income taxes, interest income, bonus expense, and stock-based compensation. During the first quarter of 2026, deferred compensation expense increased by $8,198,000 with a corresponding increase to other income, net, as compared to the same period last year, due to the change in value of assets associated with our deferred compensation plan. During the first quarter of 2026, the value of plan assets decreased by $1,138,000 as compared to a decrease of $9,336,000 during the same period last year.

Other Operating Expenses

Three Months Ended

(in thousands, except percentages)

April 3,

2026

April 4,

2025

Percent

Change

Other operating expenses

$

12,825

$

12,095

6.0

%

Percentage of total revenues

7.7

%

8.3

%

Other operating expenses include facilities-related costs, technical materials, computer-related expenses and depreciation and amortization of property, equipment and leasehold improvements. The increase in other operating expenses during the first quarter of 2026 was primarily due to an increase in occupancy expense of $388,000 and an increase in computer-related expenses of $255,000. The increase in occupancy expense was due to an increase in facility repairs and maintenance. The increase in computer-related expenses was due to continued investments in our corporate infrastructure. We expect other operating expenses to grow as we selectively add new talent and make investments in our corporate infrastructure.

Reimbursable Expenses

Three Months Ended

(in thousands, except percentages)

April 3,

2026

April 4,

2025

Percent

Change

Reimbursable expenses

$

14,486

$

8,070

79.5

%

Percentage of total revenues

8.7

%

5.5

%

The amount of reimbursable expenses will vary from quarter to quarter depending on the nature of our projects. The increase in reimbursable expenses was due to an increase in reimbursable expenses associated with user research projects.

General and Administrative Expenses

Three Months Ended

(in thousands, except percentages)

April 3,

2026

April 4,

2025

Percent

Change

General and administrative expenses

$

6,204

$

5,007

23.9

%

Percentage of total revenues

3.7

%

3.4

%

The increase in general and administrative expenses was primarily due to an increase in travel and meals of $548,000 and several other individually insignificant increases. The increase in travel and meals was due to an increase in client and business development activities and an increase in recruiting-related activities associated with the increase in technical full-time equivalent employees. We expect general and administrative expenses to increase as we selectively add new talent and expand our business development and staff development initiatives.

- 21 -

Operating Income

Three Months Ended

(In thousands)

April 3,

2026

April 4,

2025

Percent

Change

Engineering and Other Scientific

$

50,415

$

45,113

11.8

%

Environmental and Hea

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A

Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization.
Confidence: high

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This section of this Annual Report on Form 10-K generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024. Discussions of 2024 and year-to-year comparisons between 2024 and 2023 that are not included in this Annual Report Form 10-K can be found in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2025.

OVERVIEW

Exponent is an engineering and scientific consulting firm providing solutions to complex problems. Exponent's interdisciplinary organization of scientists, physicians, engineers, and business consultants draws from more than 90 technical disciplines to solve the most pressing and complicated challenges facing stakeholders today. The firm leverages over 55 years of experience in analyzing accidents and failures to advise clients as they innovate their technologically complex products and processes, ensure the safety and health of their users, and address the challenges of sustainability.

CRITICAL ACCOUNTING ESTIMATES

In preparing our consolidated financial statements, we make assumptions, judgments and estimates that can have a significant impact on our revenue, operating income and net income, as well as on the value of certain assets and liabilities on our consolidated balance sheet. We base our assumptions, judgments and estimates on historical experience and various other factors that we believe to be reasonable under the circumstances. On a regular basis we evaluate our assumptions, judgments and estimates and make changes accordingly. We believe that the assumptions, judgments and estimates involved in accounting for revenue recognition and estimating the allowance for contract losses and doubtful accounts have the greatest potential impact on our consolidated financial statements, so we consider these to be our critical accounting policies. We discuss below the assumptions, judgments and estimates associated with these policies. Historically, our assumptions, judgments and estimates relative to our critical accounting policies have not differed materially from actual results. For further information on our critical accounting policies, see Note 1 of our Notes to Consolidated Financial Statements.

Revenue recognition. We derive our revenues primarily from professional fees earned on consulting engagements, fees earned for the use of our equipment and facilities, as well as reimbursements for outside direct expenses associated with the services that are billed to our clients.

Substantially all of our engagements are service contracts performed under time and material or fixed-price billing arrangements. For time and material and fixed-price service projects, revenue is generally recognized as the services are performed. For substantially all of our fixed-price service engagements, we recognize revenue based on the relationship of incurred labor hours at standard rates to our estimate of the total labor hours at standard rates we expect to incur over the term of the contract. Our estimate of total labor hours we expect to incur over the term of the contract is based on the nature of the project and our past experience on similar projects. We believe this methodology achieves a reliable measure of the revenue from the consulting services we provide to our customers under fixed-price contracts.

Management judgments and estimates must be made and used in connection with the revenues recognized in any accounting period. These judgments and estimates include an assessment of the estimate as to the total effort required to complete fixed-price projects.

Estimating the allowance for contract losses and doubtful accounts. We make estimates of our ability to collect accounts receivable and our unbilled but recognized work-in-process. In circumstances where we are aware of a specific customer’s inability to meet its financial obligations to us or for disputes with customers that affect our ability to fully collect our accounts receivable and unbilled work-in-process, we record a specific allowance to reduce the net recognized receivable to the amount we reasonably believe will be collected. For all other customers we recognize allowances for contract losses and doubtful accounts taking into consideration factors such as historical write-offs, customer concentration, customer creditworthiness, current and forecasts of future economic conditions, and aging of amounts due.

28

The following table sets forth, for the periods indicated, the percentage of revenues of certain items in our consolidated statements of income and the percentage increase (decrease) in the dollar amount of such items year to year:

Percentage of Revenues for

Period to

Fiscal Years

Period Change

2025

2024

2025 v 2024

Revenues

100.0

%

100.0

%

4.2

%

Operating expenses:

Compensation and related expenses

58.8

59.1

3.6

Other operating expenses

8.5

8.3

7.1

Reimbursable expenses

7.8

7.2

13.1

General and administrative expenses

4.4

4.1

12.3

79.4

78.6

5.3

Operating income

20.6

21.4

0.2

Other income, net

4.7

5.0

(1.1

)

Income before income taxes

25.3

26.4

(0.0

)

Provision for income taxes

7.1

6.9

7.6

Net income

18.2

%

19.5

%

(2.7

)%

EXECUTIVE SUMMARY

Revenues and revenues before reimbursements for 2025 increased 4% as compared to the prior year. Growth during 2025 was driven by our dispute-related services reflecting the essential role our engineers and scientists play when systems do not perform as expected. Across the energy sector, we continued to see strong demand in engagements spanning hydroelectric facilities, wild-fire related losses, battery energy storage systems, and wind and solar projects. In transportation, we saw increased failure analysis work tied to electrification and battery systems in commercial vehicles, as customers addressed performance, safety, and reliability challenges. We also saw increased demand from domestic and international clients related to complex construction challenges and disputes. Proactive engagements were led by risk management and asset integrity projects in the utilities sector and regulatory consulting in the life-sciences sector.

As artificial intelligence and other advanced technologies become increasingly embedded in complex and performance-critical systems, rising societal expectations for safety and reliability continue to drive demand for our specialized expertise. Exponent is uniquely positioned to support clients with rigorous and independent insights across the full product lifecycle.

Net income was $106,009,000 during 2025 as compared to $109,002,000 during 2024. Diluted earnings per share decreased to $2.07 for 2025 as compared to $2.11 for 2024. The decrease in profitability was due to an increase in other operating expenses associated with the extension of our land lease with the State of Arizona in June of 2024, an increase in general and administrative expenses driven by higher travel and meals related to a company-wide managers’ meeting, and a decrease in the tax benefit associated with stock-based awards. During 2025, we realized a negative tax impact associated with stock-based awards of $254,000 as compared to a positive tax benefit of $2,793,000 during 2024. The change in the tax impact associated with stock-based awards was due to the change in the difference of the value of our common stock between the grant date and the release date for the restricted stock units released during 2025 as compared to 2024.

We remain focused on building our world-class engineering and scientific team to position Exponent at the forefront of innovation and meet the ever-changing needs of our clients and the market. We also remain focused on capitalizing

29

on emerging growth areas, managing other operating expenses, generating cash from operations, maintaining a strong balance sheet and undertaking activities such as share repurchases and dividends to enhance stockholder value.

OVERVIEW OF THE YEAR ENDED January 2, 2026

Our revenues consist of professional fees earned on consulting engagements, fees for use of our equipment and facilities, and reimbursements for outside direct expenses associated with the services performed that are billed to our clients.

We operate on a 52-53 week fiscal year with each year ending on the Friday closest to December 31st. Fiscal period 2025 included 52 weeks of activity and ended on January 2, 2026. Fiscal period 2024 included 53 weeks of activity and ended on January 3, 2025. Fiscal period 2023 included 52 weeks of activity and ended on December 29, 2023. Fiscal period 2026 is 52 weeks and will end on January 1, 2027.

During 2025 billable hours decreased 2% to 1,468,000 as compared to 1,495,000 during 2024. Our utilization was 73% for both 2025 and 2024. Technical full-time equivalent employees increased 1% to 973 for 2025 as compared to 967 for 2024.

FISCAL YEARS ENDED January 2, 2026 AND January 3, 2025

Revenues

(In thousands except percentages)

Fiscal Years

Percent

2025

2024

Change

Engineering and Other Scientific

$

493,893

$

469,544

5.2

%

Percentage of total revenues

84.9

%

84.1

%

Environmental and Health

88,121

88,970

(1.0

)%

Percentage of total revenues

15.1

%

15.9

%

Total revenues

$

582,014

$

558,514

4.2

%

The increase in revenues for our Engineering and Other Scientific segment was due to an increase in billing rates partially offset by a decrease in billable hours. Growth in this segment during 2025 was primary driven by demand for our risk management and asset integrity management services in the utilities industry and dispute-related services in the energy, automotive and medical device sectors. During 2025, billable hours for this segment decreased by 1% to 1,188,000 as compared to 1,199,000 during 2024. Utilization for this segment decreased to 74% for 2025 as compared to 75% for 2024. Technical full-time equivalent employees in this segment increased 2% to 771 during 2025 as compared to 759 for 2024.

The decrease in revenues from our Environmental and Health segment was due to a decrease in billable hours partially offset by an increase in billing rates. The decrease in billable hours was due to a lower level of activity for our regulatory services in the chemical industry. During 2025, billable hours for this segment decreased by 5% to 280,000 as compared to 296,000 during 2024. Utilization for this segment decreased to 66% for 2025 as compared to 67% for 2024. Technical full-time equivalents decreased 3% to 202 during 2025 as compared to 208 for 2024.

Revenues are primarily derived from services provided in response to client requests or events that occur without notice and engagements are generally terminable or subject to postponement or delay at any time by our clients. As a result, backlog at any particular time is small in relation to our quarterly or annual revenues and is not a reliable indicator of revenues for any future periods.

Compensation and Related Expenses

(In thousands except percentages)

Fiscal Years

Percent

2025

2024

Change

Compensation and related expenses

$

341,994

$

330,011

3.6

%

Percentage of total revenues

58.8

%

59.1

%

30

The increase in compensation and related expenses during 2025 was due to an increase in payroll expense, an increase in bonus expense, an increase in fringe benefits and a change in the value of assets associated with our deferred compensation plan. During 2025, payroll expense increased $4,866,000 and fringe benefits increased by $1,834,000 due to the impact of our annual salary increase and an increase in technical full-time equivalent employees. During 2025, bonus expense increased by $2,202,000 due to a corresponding increase in our bonus pool which is 33% of income before income taxes, interest income, bonus expense, and stock-based compensation. During 2025 deferred compensation expense increased $2,435,000 with a corresponding increase to other income, net as compared to 2024 due to a change in value of assets associated with our deferred compensation plan. This increase consisted of an increase in the value of plan assets of $17,363,000 during 2025 as compared to an increase in value of plan assets of $14,928,000 during 2024. We expect compensation expense, excluding the change in value of deferred compensation plan assets, to increase as we selectively add new talent and adjust compensation to market conditions.

Other Operating Expenses

(In thousands except percentages)

Fiscal Years

Percent

2025

2024

Change

Other operating expenses

$

49,458

$

46,196

7.1

%

Percentage of total revenues

8.5

%

8.3

%

Other operating expenses include facilities-related costs, technical materials, computer-related expenses and depreciation and amortization of property, equipment and leasehold improvements. The increase in other operating expenses was primarily due to an increase in occupancy expense of $1,552,000, an increase in computer-related expenses of $876,000 and an increase in technical materials of $454,000. The increase in occupancy expense was due to the extension of our land lease with the state of Arizona in June of 2024. The increases in computer-related expenses and technical materials were due to continued investment in our corporate infrastructure. We expect other operating expenses to grow as we selectively add new talent and continue to make investments in our corporate infrastructure.

Reimbursable Expenses

(In thousands except percentages)

Fiscal Years

Percent

2025

2024

Change

Reimbursable expenses

$

45,254

$

40,024

13.1

%

Percentage of total revenues

7.8

%

7.2

%

The amount of reimbursable expenses will vary from year to year depending on the nature of our projects. The increase in reimbursable expenses as compared to 2024 was due to an increase in reimbursable expenses associated with user research projects.

General and Administrative Expenses

(In thousands except percentages)

Fiscal Years

Percent

2025

2024

Change

General and administrative expenses

$

25,521

$

22,726

12.3

%

Percentage of total revenues

4.4

%

4.1

%

31

The increase in general and administrative expenses during 2025 was primarily due to an increase in travel and meals of $2,627,000. The increase in travel and meals was due to a company-wide managers' meeting held during 2025. We did not have any company-wide meetings during 2024. We expect general and administrative expenses to increase as we expand our business development and staff development initiatives.

Operating Income

(In thousands except percentages)

Fiscal Years

Percent

2025

2024

Change

Engineering and Other Scientific

$

173,625

$

164,883

5.3

%

Environmental and Health

30,558

29,995

1.9

%

Total segment operating income

204,183

194,878

4.8

%

Corporate operating expense

(84,396

)

(75,321

)

12.0

%

Total operating income

$

119,787

$

119,557

0.2

%

The increase in operating income for our Engineering and Other Scientific segment during 2025 as compared to 2024 was due to an increase in revenues. The increase in revenues was due to an increase in billing rates, partially offset by a reduction in billable hours. The increase in operating income for our Environmental and Health segment was also due to an increase in billing rates, partially offset by a reduction in billable hours.

Certain operating expenses are excluded from our measure of segment operating income. These expenses include the costs associated with our human resources, finance, information technology, corporate, and business development groups; the deferred compensation expense/benefit due to the change in value of assets associated with our deferred compensation plan; stock-based compensation associated with restricted stock unit and stock option awards; and the change in our allowance for contract losses and doubtful accounts. The increase in corporate operating expenses was due to an increase in travel and meals due to a company-wide managers' meeting held during 2025, an increase in deferred compensation expense due to a change in value of assets associated with our deferred compensation plan, an increase in stock-based compensation and an increase in corporate support expenses.

Other Income, Net

(In thousands except percentages)

Fiscal Years

Percent

2025

2024

Change

Other income

$

27,510

$

27,813

(1.1

)%

Percentage of total revenues

4.7

%

5.0

%

Other income, net consists primarily of changes in the value of assets associated with our deferred compensation plan, interest income earned on available cash, cash equivalents and short-term investments, and rental income from leasing space in our Silicon Valley and Natick facilities. The decrease in other income, net, was primarily due to a decrease in rental income and a decrease in interest income, partially offset by the change in value of assets associated with our deferred compensation plan. During 2025, rental income decreased by $1,856,000 due to the loss of a tenant in our Silicon Valley facility. The decrease in interest income of $694,000 was due to a decrease in interest rates. During 2025, deferred compensation expense increased $2,435,000 with a corresponding increase to other income, net, as compared to the same period last year, due to the change in value of assets associated with our deferred compensation plan.

Income Taxes

(In thousands except percentages)

Fiscal Years

Percent

2025

2024

Change

Income taxes

$

41,288

$

38,368

7.6

%

Percentage of total revenues

7.1

%

6.9

%

Effective tax rate

28.0

%

26.0

%

During 2025, we realized a negative tax impact associated with stock-based awards of $254,000 as compared to a positive tax benefit of $2,793,000 during 2024. The change in the tax impact associated with stock-based awards was due to the change in the difference of the value of our common stock between the grant date and the release date for

32

the restricted stock units released during 2025 as compared to restricted stock units released in 2024. Excluding the impact of the excess tax benefit, the effective tax rate would have been 27.9% for both 2025 and 2024.

LIQUIDITY AND CAPITAL RESOURCES

Fiscal Years

(In thousands)

2025

2024

Net cash provided by (used in):

Operating activities

$

131,730

$

144,537

Investing activities

$

(9,390

)

$

(6,939

)

Financing activities

$

(160,428

)

$

(65,108

)

We financed our business in 2025 through available cash and cash flows from operating activities. We invest our excess cash in cash equivalents. As of January 2, 2026, our cash and cash equivalents were $221,930,000 as compared to $258,901,000 at January 3, 2025. We believe our existing balances of cash and cash equivalents will be sufficient to satisfy our working capital needs, capital expenditures, outstanding commitments, stock repurchases, dividends and other liquidity requirements over at least the next 12 months.

Generally, our net cash provided by operating activities is used to fund our day-to-day operating activities. First quarter operating cash requirements are generally higher due to payment in the first quarter of our annual bonuses accrued during the prior year. Our largest source of operating cash flows is collections from our clients. Our primary uses of cash from operating activities are for employee related expenditures, leased facilities, taxes, and general operating expenses.

The increase in net cash used in investing activities during 2025 as compared to 2024 was due to an increase in capital expenditures. The increase in capital expenditures was due to an increase in investment in our corporate infrastructure.

The increase in net cash used in financing activities during 2025 as compared to 2024 was primarily due to an increase in repurchases of our common stock.

We lease office, laboratory, and storage space in 12 states and the District of Columbia, as well as in China, Hong Kong, Switzerland, and the United Kingdom under non-cancellable operating lease arrangements that expire at various dates through 2033. On June 19, 2024, we entered into an agreement with the State of Arizona to extend our land lease for 15 years beginning on January 17, 2028. We are currently obligated to make payments under the lease of $1,009,000 per year, which obligation will continue at that level until January 16, 2028. Beginning on January 17, 2028, our payments under the lease will increase to approximately $6,183,000 per year for the 15-year extension term with adjustments to the annual rent payment in 2033 and 2038 based on the consumer price index. As of January 2, 2026, the value of our obligations under operating leases was $82,834,000. See Note 12 of our Notes to Consolidated Financial Statements for additional information regarding our lease obligations. The value of our non-cancellable unconditional purchase obligations was not material at January 2, 2026.

We expect to continue our investing activities, including capital expenditures. Furthermore, cash reserves may be used to repurchase common stock under our stock repurchase programs, pay dividends, procure facilities and equipment or strategically acquire professional service firms that are complementary to our business.

We maintain nonqualified deferred compensation plans for the benefit of a select group of highly compensated employees. Vested amounts due under the plans of $128,645,000 were recorded as a long-term liability on our consolidated balance sheet at January 2, 2026. Vested amounts due under the plans of $16,061,000 were recorded as a current liability on our consolidated balance sheet at January 2, 2026. Company assets that are designated to fund the benefits under the plans are held in a rabbi trust and are subject to the claims of our creditors. As of January 2, 2026, invested amounts under the plans of $123,454,000 were recorded as a non-current asset on our consolidated balance sheet. As of January 2, 2026, invested amounts under the plans of $16,061,000 were recorded as other current assets on our consolidated balance sheet.

As permitted under Delaware law, we have agreements whereby we indemnify our officers and directors for certain events or occurrences while the officer or director is, or was serving, at our request in such capacity. The indemnification period covers all pertinent events and occurrences during the officer’s or director’s lifetime. The

33

maximum potential amount of future payments we could be required to make under these indemnification agreements is unlimited; however, we have director and officer insurance coverage that reduces our exposure and enables us to recover a portion of any future amounts paid. We believe the estimated fair value of these indemnification agreements in excess of applicable insurance coverage is minimal.

Non-GAAP Financial Measures

Regulation G, conditions for use of Non-Generally Accepted Accounting Principles (“Non-GAAP”) financial measures, and other SEC regulations define and prescribe the conditions for use of certain Non-GAAP financial information. Generally, a Non-GAAP financial measure is a numerical measure of a company's performance, financial position or cash flow that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. We closely monitor two financial measures, EBITDA and EBITDAS, which meet the definition of Non-GAAP financial measures. We define EBITDA as net income before income taxes, interest income, depreciation and amortization. We define EBITDAS as EBITDA before stock-based compensation. We regard EBITDA and EBITDAS as useful measures of operating performance to complement operating income, net income and other GAAP financial performance measures. Additionally, management believes that EBITDA and EBITDAS provide meaningful comparisons of past, present and future operating results. These measures are used to evaluate our financial results, develop budgets and determine employee compensation. These measures, however, should be considered in addition to, and not as a substitute for or superior to, operating income, cash flows, or other measures of financial performance prepared in accordance with GAAP. A reconciliation of the Non-GAAP measures to the nearest comparable GAAP measure is set forth below.

The following table shows EBITDA as a percentage of revenues before reimbursements for 2025 and 2024:

(In thousands, except percentages)

Fiscal Years

2025

2024

Revenues before reimbursements

$

536,760

$

518,490

EBITDA

$

148,073

$

147,058

EBITDA as a % of revenues before reimbursements

27.6

%

28.4

%

The decrease in EBITDA as a percentage of revenues before reimbursements during 2025 as compared to 2024 was primarily due to an increase in occupancy expense associated with the extension of our land lease with the state of Arizona and an increase in general and administrative expenses driven by higher travel and meals related to a company-wide managers' meeting held during the third quarter of 2025. We did not have any company-wide meetings during 2024.

The following table is a reconciliation of EBITDA and EBITDAS to the most comparable GAAP measure, net income, for 2025 and 2024:

(In thousands)

Fiscal Years

2025

2024

Net income

$

106,009

$

109,002

Add back (subtract):

Income taxes

41,288

38,368

Interest income

(9,307

)

(10,001

)

Depreciation and amortization

10,083

9,689

EBITDA

148,073

147,058

Stock-based compensation

23,795

23,239

EBITDAS

$

171,868

$

170,297

34