Ladies and gentlemen, thank you for standing by. At this time, I would like to welcome everyone to the IQVIA first quarter 2026 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by one on your telephone keypad. If you would like to withdraw your question, press star followed by one again. As a reminder, this call is being recorded. Thank you. I would now like to turn the call over to Kerri Joseph, Senior Vice President, Investor Relations and Treasury. Mr. Joseph, please begin your conference.
Thank you, operator. Good morning, everyone. Thank you for joining our first quarter 2026 earnings call. With me today are Ari Bousbib, Chairman and Chief Executive Officer; Mike Fedock, Executive Vice President and Chief Financial Officer; Eric Sherbet, Executive Vice President and General Counsel; Katie Ward, Vice President, Investor Relations; and Gustavo Perrone, Senior Director of Investor Relations. Today, we will be referencing a presentation that will be visible during this call for those of you on our webcast. This presentation will also be available following this call in the Events and Presentation section of our IQVIA Investor Relations website at ir.iqvia.com. Before we begin, I would like to caution listeners that certain information discussed by management during this conference call will include forward-looking statements.
Actual results could differ materially from those stated or implied by forward-looking statements due to risks and uncertainties associated with the company's business, which are discussed in the company's filings with the Securities and Exchange Commission, including our annual report on Form 10-K and subsequent SEC filings. In addition, we will discuss certain non-GAAP financial measures on this call, which should be considered a supplement to, and not a substitute for, financial measures prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to the comparable GAAP measures is included in the press release and conference call presentation. As previously disclosed, we implemented a new segment reporting structure effective January 1, 2026. In conjunction with this change, prior period segment amounts have been recast to conform to this new reporting structure. I would now like to turn the call over to our Chairman and CEO, Ari Bousbib.
Thank you, Kerri, good morning, everyone. Thank you for joining us today to discuss our first quarter results. IQVIA delivered outstanding financial results, achieving record first -quarter revenue and adjusted diluted earnings per share that exceeded the high end of our guidance, reflecting solid top and bottom -line performance. We are seeing continued positive year-over-year momentum across the portfolio, with strong acceleration of organic revenue growth. In fact, year-over-year, our organic revenue growth rate in Commercial Solutions doubled, and our organic revenue growth rate in R&D tripled. On the commercial side, revenue growth accelerated as clients continued to launch new products and increase the breadth of services they utilize from IQVIA. We saw particular strength in Patient Solutions, which is the part of Real World that remained in the commercial segment. Also, particular strength in analytics and consulting, which had the highest growth we've seen in three years.
Strength as well in our commercial engagement services, which includes the former CSMS segment. We feel good about demand on the commercial side, with pipelines growing to record levels, and we think AI has something to do with it. AI is causing our clients to have more questions. It's causing them to increase their demand for IQVIA's differentiated AI capabilities and for the innovation we are embedding across our commercial offerings. On the clinical side, we also delivered very strong performance in the first quarter, with better-than-expected reported and organic revenue growth. We had solid bookings with double-digit growth year-over-year, both as reported and as recast. In particular, we had solid growth in net service fee bookings, that is excluding passthroughs. Net service bookings growth in the quarter were solid year-over-year as well as sequentially, both as reported and as recast.
I should note, cancellations in the quarter were within the normal range. Why was our book-to-bill ratio 1.04 in the quarter despite solid service fee bookings growth and normal cancellations? No, AI has nothing to do with it. What happened was that pass-through bookings were unusually low in the quarter simply due to the particular mix of indications of the clinical trials we booked in the quarter. Which included more full-service trials with lower pass-throughs than usual. I want to note that the proportion of FSP in our bookings this quarter was consistent with historic levels. Regarding the overall demand environment, forward-looking demand metrics continue to point in the right direction. Our backlog reached a new record of $34.2 billion at the end of the quarter.
Noteworthy is the amount of dollars from our backlog that will convert to revenue in the next 12 months. We have $8.9 billion out of our backlog representing nearly 8% growth year-over-year versus the recast numbers last year. Our qualified pipeline grew mid-single digits year-over-year with notable strength in EVP. RFP flow grew high single digits year-over-year, driven by growth both in large pharma and in EVP. All of these comparisons are, of course, apples to apples, that is versus prior year numbers that have been recast to reflect the new segment reporting. Finally, you may have noticed EBIT funding was very strong in the first quarter, reaching $25 billion according to BioWorld, which is almost double the funding in Q1 2025. Let's turn to the results in the quarter.
We delivered outstanding revenue and profit results. Total revenue for the first quarter exceeded the high end of our guidance range, representing year-over-year of 8.4% on a reported basis, 6% at constant currency. First quarter adjusted EBITDA was up 5.5%. First quarter adjusted diluted EPS of $2.90 also exceeded the high end of our guidance range, and it increased 7.4% year-over-year. Let's now review a few highlights of business activity. Let me begin with an update on AI. As a quick reminder, IQVIA's AI solutions are built on our unparalleled proprietary data foundation, best-in-class compliance with the privacy, regulatory, and integrity standards healthcare-grade AI demands, and are connected to our deep life sciences and healthcare expertise. We've been integrating AI into our operations and solutions at scale for nearly a decade.
It's part of who we are and what we do. We already function as an AI-native company in life sciences. A few weeks ago, we unveiled IQVIA.ai at NVIDIA's GTC conference. This is our agentic AI portal and marketplace purpose-built for life sciences. It provides clients a single access point to their purchased IQVIA AI solutions, enabling centralized control with their internal user base, while also enabling visibility to a broader AI portfolio to support future solution adoption. Our deployment of highly specialized life science industry AI agents is progressing as planned. To date, we have 192 agents deployed in the field covering 64 use cases across both our Commercial Solutions and R&DS businesses. 19 of the top 20 pharma companies are already using IQVIA agents in some of their workflows, underscoring broad industry trust in IQVIA's AI capabilities.
Let me now switch to client activity first in Commercial Solutions. This quarter, we saw clients increasingly selecting IQVIA to build AI-ready data foundations, which facilitates the incorporation of AI agents, including IQVIA's agents, into their workflows. These new services expand the scope of our partnerships with clients. A few examples of wins in the quarter. A top 10 pharma client awarded IQVIA a contract to modernize performance reporting on markets and therapeutic areas using an AI-driven analytics platform. The engagement replaces hundreds of disconnected reports and dashboards from multiple vendors with a centralized, managed, AI-powered IQVIA insight solution. IQVIA secured a multi-year partnership with a mid-sized client to provide a scalable AI-ready data foundation. The win demonstrates IQVIA's plug-and-play capabilities within a client's multi-provider technology ecosystem. Pfizer and IQVIA entered into a strategic regional promotion agreement covering selected Pfizer products across 23 countries in Europe.
This collaboration brings together Pfizer's scientific leadership with IQVIA's promotional expertise, market intelligence, and AI-supported technology to support long-term impact. We entered into a strategic long-term collaboration with Boehringer Ingelheim to transform their global commercial intelligence foundation. Boehringer selected IQVIA's Data -as -a -Service, DaaS plus platform as the core accelerator to harmonize and upgrade global commercial operations, enabling more scalable analytics and a single version of the truth across therapeutic areas and geography. This collaboration will support upcoming product launches and market reporting across 59 countries. IQVIA was awarded a multi-year agreement to serve as the primary patient information and analytics partner across an EVP's full portfolio, including our Data-as-a-Service platform. This partnership is designed to drive strong visibility into existing brands, step -change improvements in analytics, insights and pipeline assets, and more intelligent commercial and portfolio decisions. Let me now turn to R&D Solutions.
Our strategy in R&DS has been to leverage our AI solutions to optimize trial design and execution to reduce timelines for our clients. Of course, we've been doing this for years through protocol optimization, site identification, and operational risk mitigation. We're taking this to the next level with AI agents, which leads to much faster study execution and increases quality by reducing errors and rework. For example, the AI agentification of the complex database setup process in a study startup, or the AI agentification of tasks involved in filing multiple documents in the trial master file. We are increasingly embedding these AI agents in our delivery model. Let me share a few examples of recent wins on the back of these capabilities. A top five pharma company selected IQVIA to provide AI-enabled global medical safety and pharmacovigilance services.
Building on a decade-long relationship and strong performance across both FSP and clinical delivery models. The deal consolidates safety operations under a single scalable model to improve efficiency and reliability while enabling ongoing innovations. A top 10 pharma client awarded IQVIA a multi-year agreement to serve as the primary partner for delivering full -service global clinical trials. We differentiated ourselves through AI-enabled innovation that accelerates development and improve execution quality. IQVIA won a contract of a global mid-size pharma to deliver a phase III clinical study supporting a high-profile oncology asset. In this case, we were selected based on our experience running similar studies, as well as our ability to deliver AI-enabled trial design, protocol optimization, and site identification. A top 20 pharma company selected IQVIA to support a late-stage clinical program in asthma in overweight patients.
The win highlighted AI-enabled clinical solutions, including in protocol and design strategy optimization, regulatory compliance, and study document filings. For an EVP, we are delivering a global late-stage clinical program that integrates clinical and laboratory services within a single operating model with agentified analytics embedded across site feasibility and selection, enrollment, and performance forecasting. Lastly, in the quarter, we announced a strategic collaboration with the Duke Clinical Research Institute to advance clinical research in obesity and related cardiometabolic conditions. The collaboration brings together IQVIA's global operational scale and execution capabilities with Duke's academic rigor and scientific leadership, creating an integrated end-to-end model for large, complex clinical trials. The partnership is designed to accelerate trial startup, improve execution efficiency, and support regulatory submissions and commercialization.
IQVIA contributes deep expertise in obesity and metabolic disease, having supported more than 120 obesity trials and enrolled more than 90,000 patients, including work across all FDA-approved GLP-1 therapies to date, providing sponsors with a proven operational foundation. This partnership with Duke has already resulted in a significant pipeline of opportunities and a few wins in the second quarter. Now to Mike for more details on our financial performance.
Thank you, Ari, good morning, everyone. As Ari noted earlier, we implemented a new segment reporting structure effective January 1st, 2026. In conjunction with this change, prior period segment amounts have been recast to conform to this new reporting structure. Let's start by reviewing revenue. First quarter revenue was $4.151 billion, through 8.4% on a reported basis and 6.0% at constant currency. Revenue growth includes about two points of contribution from acquisitions. Commercial Solutions revenue for the first quarter was $1.754 billion, up 11.6% on a reported basis and 8.5% at constant currency.
R&D Solutions first quarter revenue was $2,397 million, up 6.2% on a reported basis and 4.2% at constant currency. Moving down the P&L. Adjusted EBITDA was $932 million for the first quarter, representing growth of 5.5% year-over-year. First quarter GAAP net income was $274 million, and GAAP diluted earnings per share was $1.61. Adjusted net income was $492 million for the first quarter, and adjusted diluted earnings per share was $2.90, representing growth of 7.4% year-over-year. Turning to R&DS bookings.
To provide an apples -to -apples comparison, the numbers on this chart for last year's Q1 2025 net new bookings and backlog have been recast to reflect the Real World late phase and certain other Real World offerings that are closely related to the clinical trial business, which we moved from TAS to R&DS. On this new basis, R&D Solutions net new bookings in Q1 2026 was $2.5 billion, a double-digit increase year-over-year. R&DS backlog at March 31st was $34.2 billion, which is an increase of mid-single digit year-over-year. Additionally, the next 12-month revenue from this backlog was $8.9 billion at March 31st, which is up high single digits last year on a recast basis. Now reviewing the balance sheet.
As of March 31st, cash and cash equivalents totaled $1.947 billion, and gross debt was $15.833 billion, resulting in net debt of $13.886 billion. Our net leverage ratio ended the quarter at 3.62 times trailing 12 months adjusted EBITDA. First quarter cash flow from operations was $618 million, and capital expenditures were $127 million, resulting in strong free cash flow of $491 million, which represents 100% of adjusted net income, a 15% increase year-over-year. In the quarter, we repurchased $552 million of our shares, which leaves us approximately $1.2 billion of repo authorization remaining under the current program. Now turning to guidance.
We are reaffirming our full -year 2026 guidance for revenue and adjusted EBITDA. We are raising the guidance for adjusted diluted earnings per share. We continue to expect revenue to be between $17.15 billion and $17.35 billion, representing growth of 5.2%-6.4% or 5.8% at the midpoint. This revenue guidance continues to assume approximately 150 basis points of contribution from acquisitions and approximately 100 basis points of tailwind from foreign exchange. These assumptions are unchanged from the prior guide. We continue to expect adjusted EBITDA to be between $3.975 billion and $4.025 billion, growing 4.9%-6.3% year-over-year, or 5.6% at the midpoint.
We are raising our adjusted diluted EPS to be between $12.65 and $12.95, up 6.1%-8.6% versus prior year, or 7.4% at the midpoint. Turning to the second quarter. For Q2, we expect revenue to be between $4.28 billion and $4.34 billion, which represents year-over-year growth 6.5%-8.0%. Adjusted EBITDA is expected to be between $955 million and $975 million, representing growth of 4.9%-7.1% versus prior year.
Adjusted diluted EPS is expected to be between $2.98 and $3.08, which represents year-over-year growth of 6.0%-9.6%. Both this guidance and our full -year guidance assume that foreign currency rates as of May fourth continue to the balance of the year. To summarize, IQVIA delivered outstanding financial results. The first quarter revenue and adjusted diluted EPS exceeding the high end of our guidance. We delivered strong acceleration of organic revenue growth in both Commercial Solutions and R&DS. R&DS net new bookings grew double-digits year-over-year with solid year-over-year and sequential growth in net service fee bookings.
We continue to make very strong progress in the deployment of highly specialized life science industry AI agents with more than 190 agents deployed covering over 60 use cases across Commercial Solutions and R&DS businesses, with 19 out of the top 20 pharma companies already using our agents in some of their workflows. The forward-looking indicators continue to point in the right direction for both Commercial Solutions and R&DS. We repurchased $552 million of our shares in the first quarter, and we reaffirmed our full year 2026 guidance for revenue and adjusted EBITDA and raised the guidance for adjusted diluted earnings per share. Now with that, let me hand it back to the operator for Q&A.
Your first question comes from the line of Michael Cherny with Leerink Partners. Your line is now open. Please go ahead.
Good morning, everyone. Thanks for taking the questions. Maybe if I can just dive in a little bit more on the services versus pass-through and bookings that you saw in the quarter. As you think about the demand dynamic, how should we think about that conversion of what you're winning of a lot of the contracts obviously you went through against the margin progression, Ari? I just wanna make sure I understand we all understand the push and pull on what's coming through across the into the backlog versus how profitable it is relative to the core business, especially if these are a lot more full service-oriented wins within the R&DS segment. Thank you.
Okay. I hope I understood your question well, just, you know, the service fees versus pass-throughs, you understand that pass-throughs have zero profitability drop-through, right? I mean, that's clear. Pass-throughs are irrelevant to profitability. We have to report them because that's an accounting requirement. We had solid execution in the quarter. We booked $2.5 billion of trials in the quarter. It just happens to be that the mix of indications was such that we had full -service trials have less pass-throughs. Not FSP, just full -service trials that had less pass-throughs. In fact, if you look at the pass-throughs, I think, I don't know if we disclose this generally, the first quarter was, you know, pass-throughs was like about one-third lower than the historic average.
It's always within a range, but it was significantly lower. You know, again, had we had a regular mix of projects, consistent with the long-term history and a consistent level of pass-throughs, we would not be having this conversation. The infamous quarterly book-to-bill ratio would have been quite significantly higher. There's no impact on margins, you know, unexpected margins. There's no impact whatsoever. I want to point out that on the pure service fee bookings, year-over-year and sequentially, we were up very significantly. Now, ignoring the pass-through issue, generally, Q1 NNB is always lower than Q4 sequentially. If you look at our history, it's usually lower 16%-17% Q4 to Q1. In this quarter, it was lower, less than that. I think it was 13% down.
It was lower as always, but a little bit less than usual. Frankly, we also have the most conservative bookings policy in the industry. You only book business when it's contracted. If we are awarded a couple of trials at the end of the quarter, and, you know, the client board is only meeting on April 2nd, and that's when the contract is signed, then that's when we book it. It's not the 1st quarter win. The influence this can have on a reported book-to-bill is a very significant. Again, and I said this when we reported book-to-bill ratios of 1.3, I said it when we reported book-to-bill ratios of 0.9, and I'll say it again today.
The quarterly book-to-bill metric is really a bad metric to predict future growth. I can point easily to many of our competitors who reported great book-to-bill ratios and are gonna have very negative growth going forward. I point to us. Last year at this time, we reported a book-to-bill of 1.02. If this were predictive of growth, this quarter we would be showing really poor anemic growth in our R&DS. Yet, we're reporting very strong 3% organic growth, over 6% reported. When we strip a couple of points from FX and about a point from acquisitions, our organic growth in R&DS was 3%. Could you have predicted that from a 1.02 reported book-to-bill last year? The answer is no.
Again, and again, there's zero impact from AI in our bookings. I just don't want anyone to get the wrong impressions. I can report that the number of trials that we lost to anyone using Jean -Paul or any other AI tool, the number of trials that we lost to any of these AI solutions is exactly zero. Again, no impact on margins whatsoever from the unusually low pass-throughs in the bookings this quarter. I hope that gives you enough coverage.
It's helpful context, Ari. Thank you.
Your next question comes from the line of Justin Bowers with Deutsche Bank. Your line is now open. Please go ahead.
Good morning. A two-parter, maybe one for Ari and one for Mike. Just in terms of the wins you saw here, it's interesting to hear FSO, the FSO dynamics and that having less pass-throughs. Is that more of a function of how customers are the clinical strategy that you're deploying? And/or are you seeing any shift there from large pharma, either in the quarter or what's in the funnel? That's number one. Part two of that would just be on the margins. Is that something that we would that we would see this year, or is that more of like a 2027 and beyond dynamic?
Thank you. Again, look, Again, I'm gonna repeat again. One quarter doesn't make a trend. One quarter of bookings, $2.5 billion of bookings that are gonna be to revenue over the next four to seven years, is not going to affect our margins, one bit. Now, it's not indicative of any change whatsoever. It just happens to be that the trials that we won this quarter had lower pass-throughs. It had nothing to do with a change in customer dynamic. Nothing. Just happens to be that's the deck that we were served and that we went after. Some trials, like for example, you'll recall vaccine trials had enormous amounts of pass-throughs.
There are certain types of large cardiovascular studies that require a lot of patients and a lot of procedures to perform the protocol of the trials, may require more reimbursed expenses. That just wasn't the case this quarter. It's unusual that we would have, you know, lower pass-throughs, but that's what happened. Nothing more to it, and I wouldn't read anything about, you know, changing client dynamics or anything like that. Not at all. You know, you're trying to understand the demand, which I think is the right question. Frankly, we see no change at all in the fundamental drivers of outsourced clinical development. The level of complexity in trials is rising. The need to execute trials globally is rising.
The growing use of data and analytics, all of these point to the need to outsource more, not less. In our conversations with pharma, we see a constructive demand environment. Yes, in the near term, we see that the environment has stabilized. We see also that large sponsors are still taking a more deliberate approach to capital deployment than. Recall, they're coming out of three to four years of policy-driven macro headwinds and all kinds of disruptions. We still see, you know, We haven't returned to the decision-making speed that we saw before all of this period started. It's getting there. We're seeing things going back to in the right direction. That's for large pharma.
On the EVP side, you know, I mentioned funding, which is growing at a very nice pace, which points to renewed confidence in the assets in the pipeline in general in the industry. As you know, it could take a year or a year and a half before funding drives an award, and certainly into the backlog. The demand indicators are quite strong. You wanted to address that other question?
Sure. Yeah, I'm happy. Firstly, just to re-emphasize Ari's point about do not draw any sort of margin conclusions from one quarter booking. You have to remember that, you know, every dollar we book now burns over, like, five years. I'll give you some more color on our margins and use Q1 as an example. When we recorded 60 basis points of EBITDA and margin contractions, all of that was due to non-operational headwinds, which are really sort of the effects and pass-throughs driving that. We have a very strong productivity program. When you look what happened operationally, right, obviously, we're dealing with adverse mix in sort of our portfolio, but our productivity programs more than offset that mix. Operationally, we expanded margins actually quite significantly in the quarter.
It just further highlights the point to say, you know, when you look at sort of a quarter sort of bookings or even several quarters of bookings, you know, you can make no correlation to future sort of margins.
I want to add, I think, just take the opportunity to once again reiterate. We reported because you wanted this book-to-bill ratio. We give you a lot of color on what's in our bookings, more color than anyone else in the industry. Oh, by the way, you know, our number two competitor is part of a larger conglomerate, and we know nothing about their numbers. Our number three competitor, we have no clue what their numbers are now or in the past three years. Not yet, at least. Our number four and five competitors are private. We have no clue what their bookings are or their numbers are. That's it. There's no one else out there. We can't be compared to anyone else. You have two marginal competitors.
You know, we are disclosing an enormous amount of information, and it's not comparable to anyone else. Even from a competitive standpoint, frankly, there's very little rationale for us to give you so much color on bookings, A, because you derive conclusions that are really false and misleading, and B, because it's competitive information that we give to competitors who don't disclose anything.
All right. Thanks so much, Ari and Mike.
Your next question comes from the line of Luke Sergott with Barclays. Your line is now open. Please go ahead.
Good morning, guys. This is Anna Kruszenski on for Luke. Appreciate you taking our questions. Wanted to talk more about the upside and Commercial Solutions, and I know you called out, like, a few of the businesses that were really strong during the quarter. It would be great to hear more about maybe which areas were the most surprising versus your internal expectations. Also, if you could remind us on the mix of, like, the more recurring revenue offerings within this business versus what's more discretionary. Thanks again.
Thank you very much for your question. You know, our Commercial Solutions business is way underappreciated. I'm thanking you for highlighting the business. We performed very well in the first quarter. You will recall that, you know, when the industry went through difficulties over the past three years, the headwinds caused our large pharma clients to pause discretionary spending. As a result, our growth rates never went negative, but they slowed down to low single-digits organic growth. We then started to rebound, and a year ago, in the first quarter, our organic growth rate was, what, about 2.5%? Correct. Thereabouts. Yes. Our organic growth rate in Commercial Solutions this quarter was 5%. We reported, I think, what was the growth rate?
11.6% at actual effects. As you know, we have a strong tailwind from currency this quarter. If you take that out, the constant currency growth rate is 8.5%. We had acquisitions, and when you strip that out, the benefit of acquisitions we did last year, it's 5% organic growth. It's double the underlying organic growth year-over-year. What's driving this? You've heard me say in my introductory remarks that customers have more questions than they had before because of AI. You know, if I can speak generally, our work on AI on the clinical side is focused on creating efficiency and improved execution and reduced timelines.
We are embedding AI agents within our existing processes and workflows and helping our clients accelerate timelines, which is simply an evolution of what we've been doing over the seven years since the merger, which was predicated on utilizing data, insights, and intelligence to reduce timelines. On the Commercial side, we are focused on innovation that is creating new offerings, and those are gaining traction with our customers. Customers are dealing with massive amounts of data from us, from third parties, and generated by their own operations. They are also dealing with a legacy of disparate systems, you know, that have been built over the years.
AI agentification processes enable our clients to sort of bypass and leapfrog all of these systems and multiple vendors and data sources, and have the ability to analyze information much faster, to derive insights, and to make decisions informed by AI agents at much higher speed. We have been focused on developing agents that enable our clients to do precisely that. Our agents comply with the regulatory requirements of the healthcare industry. They are not generic solutions. They are tailor-made, what we call health-grade AI agents. We found that our clients are very interested in those solutions. We have pipelines that have reached record levels, in part influenced by the offerings that we put into the marketplace that we continue to put out.
You know, a lot of concern was voiced by investors and analysts in the past few quarters consequent on a article about how AI will replace services industries. You know, nothing of the sort is going to happen. Quite the opposite. It creates new demand for our service. The part of our commercial business that theoretically would be most vulnerable to AI disruption is what we call analytics and consulting. Yet we have record pipeline in analytics and consulting. We had very strong growth, the best we've had in three years in the quarter, we see this continuing in the balance of the year. The underlying demand in Commercial Solutions is simply fueled by the amount of new drug launches. For example, in Q1, there were 10 new drug launches. A drug launch is the bread and butter of our Commercial Solutions business.
I think last year at this time, we had about six or seven launches. It's increasing because of the number of molecules that have been approved by the FDA over the past two years. Our win rates in the business continue to be strong. I think you asked about the balance of. You know, nothing's changed in terms of our outlook for the different parts of the business. If I can just summarize in the interest of time. Our info business is about 30% of the total, and will continue to grow low single digits. A little bit stronger than that because there's more demand for data that our own AI agents create. That's the slowest -growth business.
The fastest -growth business within Commercial Solutions is what we call Patient Solutions, which is the pieces of Real World that were left with Commercial Solutions, and those have very strong double-digit growth. Everything else, analytics and consulting, commercial tech and commercial engagement services, which includes the former CSMS business, by the way, now also supplemented with AI agents. Those will grow mid to high single digits going forward. I hope that gives you more color. Thank you.
Your next question comes from the line of Shlomo Rosenbaum with Stifel. Your line is now open. Please go ahead.
Hi. Thank you very much. Ari, I wanted to get just a view on the market in general. The commentary that you've had is that it's stabilizing, but we're seeing things like talking about analytics and consulting that you said is the highest growth in three years. That very often is a leading indicator that things are actually improving and we're seeing things get better. I want to ask you where you could point to us where you're seeing things actually growth accelerating versus just stabilizing or getting, you know, less negative, if there's anything like that. Do you think that the performance that you have is indicative of market growth, or are you noticing an improvement in the win rates of the business?
I end up asking that in light of the fact that, you know, there is not a lot of data from other public companies, but just whatever you can see and comment on that.
Yeah. Well, look, I completely understand the question. I mean, it's a question we just had a moment ago again on the demand environment, and it's normal, right? We're coming out of a period, you know, really three to four years of significant turmoil in the industry, largely driven by, A, the post-COVID deflationary environment. The post-bubble decline, which constrained budgets. B, the IRA, you know, under the Biden administration. C, all the announced or enacted policies under the Trump administration, the NFS, the tariffs, the FDA changes, et cetera, et cetera. All of that constrained the demand environment both on the clinical and on the commercial side. It's always, when we come out of a period like this, it's always difficult to evaluate, well, are we out there?
Are these real green shoots or not? I understand the, the concern. Frankly, we ourselves are surprised about how well we performed in the quarter. I mean on every single measure. I think we believe, and we strongly believe it was an extremely clean quarter. We beat on every one of our financial metrics pretty much. We, you know, surpassed our own expectations in both businesses. You know, the AI disruption concerns are actually, as we said, a tailwind for our business, and we are seeing it already. We feel confident that disruption will continue. That's the overall kind of 40,000 foot perspective. Now, in our conversations with clients, large pharma, as I mentioned before, is much more constructive, both on R&DS and Commercial.
I would say a little bit more on commercial because large clinical trials, large capital programs always take more time to get started. Again, coming out of a long three, four-year period of a more deliberate, slower decision-making, we have not returned to, you know, business as usual, cruising altitude, if you will, before all of this started. We are much improved versus where we were. The environment is more constructive in large pharma, not quite back to where we were on large pharma, but we're getting there. On the EVP front, EVP funding is reaching record levels. $20 billion in the first quarter is almost, what, double what it was last year.
Again, it takes time, but the fact that people commit very significant capital to specific programs in biotech is indicative of renewed confidence and comfort level, higher comfort level going forward. I think that, you know, we're gonna continue to see this environment. If your question is, are we going back to where we were before next quarter? I don't think so. I think the balance of the year will continue to be on the large pharma side. A little slower than it has been, much better than it was last year, much better than it was two years ago. More deliberate thinking.
You know, a large pharma client told us, actually, if I can share that anecdote, that they plan to double the number of molecules in their pipeline because they are using AI to identify more targets. Meaning, most of what large pharma has been doing so far on the AI front is at the discovery stage. That, and maybe that may be counterintuitive to some, but to us, it's pretty obvious that will increase the number of trials because that will increase the number of molecules that are selected. Large pharma are telling us directly that it will increase. They are even asking us questions about capacity. How do we increase capacity to be able to handle a much larger number of targets?
Bear in mind, there are a number of LOEs coming up in the four-five-year timeframe, and pharma has to replenish their pipeline. AI, as it is used today, which again, 90%+ of what AI is using on the clinical side is at the discovery stage, is increasing the number of assets that are going to be pursued. When you feel you have a higher chance of success, then you are gonna launch the program. AI at the discovery stage enables you to identify more targets for such development. That, in my mind, increases demand for CRO services and not the opposite, going forward. Our conversation with large pharma clearly indicate that that is the case. They're even asking us, you know, "What would it take to ramp up capacity?" We're not talking next quarter, obviously, but in the midterm.
That's for clinical and commercial, I already commented on it. Thank you.
Thank you.
Your next question comes from the line of Elizabeth Anderson with Evercore ISI. Your line is now open. Please go ahead.
Hi, guys. Good morning, thanks so much for the question. I was wondering if you could comment on sort of the drivers of the margin, particularly on EBITDA, as we move through the year. Obviously, I think the second quarter guide implies a little bit lower, EBITDA margin versus consensus. I'm wondering if that's a sort of right -sizing of some of the mix impact, how do we think about that perhaps as you're thinking about the back half of the year? Thanks so much.
Sure, Elizabeth. I'll take that one. If you look at our EBITDA progression that's implied in our guide, it's pretty consistent with history. I think there's nothing noteworthy to call out there. Just to add a little color on the margin side, as we mentioned, when we gave our Q1 sort of guidance, Q1 has the largest FX tailwind, and you'll see that start to moderate as we go through the back end of the year. Given the previously mentioned strength in our productivity programs, you know, we're very confident that we'll see the reported margins sort of flip to positive as we progress through the year.
Okay. Thank you.
Your next question comes from the line of Eric Coldwell with Baird.
Thanks very much. Good morning. I'm gonna start going back to the bookings, maybe look at it a little differently. You exited 25 with about $10 billion of total net awards. I don't know what the normal exact passthrough mix is, but if I use a, I don't know, a swag of 30%, that would be about $3 billion a year of passthrough bookings, about $750 million a quarter. A third below would be about $250 million. If we add $250 million back to reported awards as if passthroughs were normal, that would get us to about a 1.15 book-to-bill. I just want to make sure that that logic and thought process is, you know, somewhat consistent with what you're trying to express today, and maybe that leads to.
Eric, you're amazing. The answer to your question is yes.
All right, just tell my wife and kids that I'm amazing.
Write you a letter.
I was gonna insert a joke here.
By the way, if in addition to that our revenue in R&DS would have been what we planned as opposed to the strong beat because we converted faster, we burned faster in the quarter, then it would have been north of that. I'll let you figure it out. You do well at math.
I guess I won't insert my joke of what is the book-to-bill in Q2. I do have one other serious follow-up. Can we get the constant dollar organic growth in both segments? I know you did give some proximate details on commercial. Maybe you could solidify, you know.
Sure
you could solidify those comments for us and then give us the R&DS numbers.
Yeah
on a recast basis.
Yeah, absolutely.
Yeah.
Absolutely. Okay, I'm gonna say from memory, but you just heard me. 8, the growth on R&DS reported is 6.2%. Is that the number?
Correct.
Right. Two points of that is FX.
One point is, acquisitions, right? Across.
Yeah.
Therefore, organic growth for R&DS in the quarter was 3%. A year ago, it was 1%. On the commercial side, reported is 11.5%.
11.6.
11.6. The FX impact is three points. The acquisition impact is another three points or so, a little bit more than three points, right? Organic on the commercial side is 5%, which is double what it was last year.
About 4% over advanced.
Right. Again, 3% organic for R&DS, 5% organic for Commercial, 4% for the enterprise.
Thanks very much. Keep up the good work. I thought it was a good quarter.
Excellent. Thank you. Appreciate that, Eric.
At this time, Mr. Joseph, I turn the call back over to you.
Thank you, operator. Thank you, everyone for taking the time to join us today, and look forward to speaking with you again on our second quarter 2026 earnings call. The team will be available the rest of the day to take any follow-up questions you might have. Thank you. Have a good day.
This concludes today's conference call. You may now disconnect.