Good morning. My name is Christy, and I will be your conference operator. At this time, I would like to welcome everyone to ADP's Third Quarter Fiscal 2018 Earnings Conference Call. I would like to inform you that this call is being recorded and all lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you. I would now like to turn the conference over to Mr. Christian Greyenbuhl, Vice President, Investor Relations. Please go ahead, sir.

Thank you, Christy, and good morning, everyone. This is Christian Greyenbuhl, ADP's Vice President, Investor Relations, and I'm here today with Carlos Rodriguez, ADP's President and Chief Executive Officer; and Jan Siegmund, ADP's Chief Financial Officer. Thank you for joining us for our third quarter fiscal 2018 earnings call and webcast. Before I hand the call over to Carlos, I want to give you a brief reminder about our upcoming Investor Day. The event will be held on June 12th in New York City, and we have an exciting agenda planned that will showcase our new products, and include an update on our business and transformation initiatives. We look forward to seeing you there. Moving on to the quarter, I'd like to remind you that during our call today, we will reference non-GAAP financial measures, which we believe to be useful to investors, and that include the impact of certain items in the third quarter of fiscal 2018 as well as the third quarter of 2017. A description of these items and a reconciliation of these non-GAAP measures can be found in this morning's press release and in the supplemental slides on our Investor Relations website. Today's call will also contain forward-looking statements that refer to future events and as such involve some risk. We encourage you to review our filings with the SEC for additional information on risk factors that could cause actual results to differ materially from our current expectations. Now, let me turn the call over to Carlos.

Thank you, Christian, and good morning, everyone. This morning we reported our third quarter fiscal 2018 results with reported revenue up 8% to $3.7 billion, 6% on an organic constant currency basis. We are pleased with the strong revenue growth for the quarter and we are especially pleased with our quarterly Employer Services revenue retention, which increased 170 basis points. In our PEO segment, average worksite employee growth was 9% for the quarter, slightly below our expectations, though we continue to see strong demand particularly in the down-market. Our solid 9% new business bookings growth this quarter was in line with expectations as we continue to see improving demand for our HCM solutions. Our down-market and international businesses continued to perform well, and we were also encouraged by the performance of our up-market offerings compared to a difficult third quarter in fiscal 2017. As you can see from our reported results, we continue to see broad-based progress from investments we made in our sales force, and are therefore, increasing our fiscal 2018 new business bookings guidance growth to 6% to 7% from 5% to 7%. Our adjusted diluted earnings per share grew 16% to $1.52 per share as we delivered improving adjusted EBIT performance and benefited from a lower effective tax rate and fewer shares outstanding. Overall, our earnings growth in the quarter exceeded our expectations and we're happy with our strong performance, which Jan will walk you through in more detail shortly. Now, I'd like to discuss our innovation efforts and how they remain at the core of our strategy. We're continuing to invest in a new breed of HCM solutions that we anticipate will address the evolving needs of millions of workers every day and we're proud to be recognized for it. Most recently, Constellation Research recognized our…

Thank you, Carlos, and hello, everyone. Before I proceed with a deeper dive on our financial results, I would like to talk a little bit about our transformation initiatives. As Carlos highlighted, we continue to execute on our transformation initiatives, and this quarter, we recognized approximately $40 million of charges which are excluded from our non-GAAP results. Some of the anticipated benefits from these investments were already contemplated in our September 2017 investor presentation, while other incremental investments made this quarter are focused on expanding our productivity improvement initiatives to further drive our transformation efforts. We believe the benefits from these investments will continue to help us deliver against our long-term financial objectives. I also want to be clear that the $40 million of charges are not related to our previously announced voluntary early retirement program. We expect the benefit of this program to begin help reduce our pre-operating expenses starting early fiscal year 2019. With that said, let us now dive into the financial update. As Carlos mentioned, ADP reported revenues grew 8% in the quarter to $3.7 billion, and we now fully lapped the pressure from the fiscal year 2017 sale of our CHSA and COBRA businesses. We are happy with this revenue growth and with the performance of our recent strategic acquisitions as we continue to work towards fully integrating them into our suite of offerings. On a reported basis, earnings before income taxes increased 3%. Our adjusted earnings before interest and taxes or adjusted EBIT increased 8%, and included approximately one combined point of lift from FX and the impact from our fiscal year 2018 acquisitions. Adjusted EBIT margin decreased about 20 basis points compared to 24.6% in last year's third quarter and was better than our expectations. We were pleased with our margin performance as…

Thank you. We will take our first question from the line of Jason Kupferberg of Bank of America Merrill Lynch. Your line is open.

Hey. Good morning, guys, and nice set of results. I just wanted to start on margins, obviously, good to see the guidance increase there. So, you're now looking at flat year-over-year, which I think implies that your June quarter will be up almost 300 basis points. I know that benefits from an easy comp, but nonetheless much better than previously envisioned. So, given that the benefits of the early retirement program won't even start kicking in until next fiscal year, how should we start thinking about the potential margin expansion trajectory for fiscal 2019 relative to the multiyear outlook you had given last-September?

Jason, thank you. As you know, we will give guidance later in the year for 2019. But in addition to having completed our migrations, making progress on our Service Alignment Initiatives, and an easier compare relative to investments that we made last fourth quarter, in particular into our sales force, we have a number of sources that will drive the margin expansion in the fourth quarter that we anticipate. The early retirement initiative is really going to be kicking in in 2019 as we then work on the transition of those workers who have chosen – employees that have chosen the early retirement in 2019. I hope that's helpful.

Yeah. I'm sure we'll get more color at the Analyst Day. Just for my follow-up, any callouts on the strong retention result as well as the strong bookings growth? I mean, I know the bookings forecast change isn't big, but nonetheless you are nudging it up. So, I was just curious if there was any parts of the end market there that have improved more notably than others? And then, along the same line, as it relates to retention, does it seem like these underlying trends are sustainable now that the mid-market migrations are complete?

So, I think on the sales – on the new business bookings growth, given the absolute size of our new business bookings, the change in guidance for us – you're right, it's relatively modest in percentage terms, but I think the sales force would say that's pretty meaningful, because it's a lot of additional dollars in new business bookings. On the retention side, we did have an easier compare versus last year. If you remember, we – I think every call, I think I just caution everyone that because of the way we calculate revenue retention on a quarterly basis, if you have one or two large losses, it can really impact the numbers, even given ADP's size, it can have an impact...

Right.

...on the retention. And I think last year in the third quarter was one of those quarters. And then, again, here now I have to say the opposite, which is when you have a great quarter and you don't have a lot of large losses, which we didn't have this quarter, it helps. And so, I think that was part of it. But I would say that the improvement was broad-based, so you can obviously by my comments see that a lot of that improvement was in the up-market and some of that is an easier compare. But we also have had really good results in our mid-market, which as you know, it's been a multiyear effort to kind of climb back in terms of the retention pressure that we felt a few years back as a result of ACA activity, and also as a result of the migrations that we've undergone there. So, I'm very proud of the mid-market retention results as well, but I think other places also – so, I guess as usual at ADP, since we are so diversified in terms of segment and geography, for us to have a large improvement in retention of that magnitude it has to be somewhat broad-based and I think it was.

Maybe I'll add two components to your answer, Carlos. Number one, the positive trend in retention is supported by continued improvement of our client satisfaction scores, also a broad-based improvement, which means our investments that we undertook last year into our service components are really taking root, and as a consequence, our service operations are also very good at this point in time. So, I think those investments have translated then broad-based into and supported some of the retention improvement that we saw on the quarter.

Yeah. I actually received a note last night from one of our business unit leaders with an update on our client satisfaction scores. We measure NPS and the trend there is incredibly positive. They even used the term service renaissance because we did have some struggles and stumbles a couple years ago, and I think our client satisfaction stores now have been on a multi-quarter kind of upward trajectory, admittedly from some difficult compares, but doing really quite well.

Terrific. Nice job. Thanks for the comments.

And sorry, last comment on that, on the other – on the client satisfaction side is that, one of the things that we were careful about in terms of our Strategic Alignment Initiative is making sure that it didn't disrupt our – we had, I think our number one objective was to improve client satisfaction and NPS scores, and things like Strategic Alignment Initiative and early retirement have the potential to disrupt that. But the good news is, obviously, early retirement, we still have to execute on, but the Strategic Alignment Initiative, I'm happy to report our leaders have executed flawlessly there and actually have gotten great client satisfaction in those new strategic locations, which is not easy to do because we have a lot of new associates in those locations.

Thank you.

Thank you. Our next question is from Ashwin Shirvaikar of Citi. Your line is open.

Thank you. Hi, Carlos. How are you? So, I want to go back to the topic of retention. Obviously, it's a volatile metric as you mentioned, but assuming that the high attrition is also linked with the new service delivery, I guess the question is, do have to maintain the level of spend on service delivery or is there more of a – or was that more of a technology spend that you can now scale up on, if that makes sense?

Well, to be – I mean, Jan could probably add a couple of comments, but to be clear, like we – in some of our businesses where we've had large increases in client satisfaction and large increases in NPS and large increases in retention, our service spend has actually declined. So, we're – obviously, part of our business transformation efforts are to get better at – as you know, one of our key objectives in our initiatives is to reduce the number of, what we call, non-value-added contacts which drive costs, but don't drive value for our clients. So, there are places where we've invested more in service, and as you can see, we've also invested in sales. But there are places where we have done both improved productivity, improved efficiency, and actually, better results from a retention and a client satisfaction standpoint. And that's obviously our hope for the next X-number of years for us to be able to drive operating leverage and improve margin, that's kind of an important thing for us to be able to accomplish.

Yeah. I've only two additional details to add. The investments that we made into service augmented, in particular in the mid- and up-market, our capabilities to service our larger clients better, in particular with dedicated service reps. But then we have a whole slew of productivity initiatives that Carlos mentioned that will drive efficiency and effectiveness of our service cost. And the most obvious one is, obviously, our new strategic service locations are labor cost advantaged and we have now a simpler operating environment, a single platform. We finished our migrations in the mid-market that will allow to implement faster productivity improvements and optimization of our operations. So, with that combination, higher service levels and through strategic changes to our service model, paired with efficiency and effectiveness initiatives, and so I think we will be able to achieve both.

And as much as it might not be directly related to our new business bookings growth, I would say that I think these efforts around simplification, improved client satisfaction and some of the other things that Jan mentioned, I think really should help our sales force as well. I mean, when we went through some challenges a couple of years ago, there was just a lot of distraction, not to mention a very difficult grow over. Obviously, the number one issue was just the grow over around ACA, but some of the service challenges we had were also a distraction to our sales force. So, I think getting that behind us, I think, should help as well. Because, again, despite the fact that it was a modest improvement in new business bookings growth guidance, it was an increase, and this quarter, we're pretty proud of 9% bookings growth after really suffering for several quarters here with very, very difficult grow overs and compares.

Those are good points. So, but then – I guess the follow-up question becomes, it sounds from your comments, there is a margin benefit coming from the combination of retention and maybe the spend on service delivery going down over time as you scale that margin benefit from voluntary termination. So, would you – is your preference to reinvest those savings and to what degree, and how much might flow to the bottom line becomes the obvious question? And then, the other part of it is, in general, are there other explicit things other than the voluntary termination program that you're planning, if you could talk about that? Thanks.

You came to the right place for the answer to that question. Jan wants it all the flow to the bottom line and I want to reinvest some of it. So, the truth will be somewhere in between, and you'll know more when we give our guidance for 2019 and also when we, in Investor Day, give you kind of a longer-term I guess objective view of what we think margins will do over the ensuing couple of years. So, I think unfortunately we're just a little premature in being able to get out in front of talking about kind of multiyear margin improvement, but I just want to add that foundationally, all the things you said are dead-on in terms of there is the possibility and the capability for us to drive improved margin. This is what we've been trying to talk about. For the last two or three years, we've been laying the groundwork with all of these initiatives, Strategic Alignment Initiative, completing the migrations, voluntary early retirement, these are all intended to help us be a stronger, more profitable company. But stronger is the first word and that means that sometimes you have to invest some. I will add that there is no question that the underlying margin trend is positive for us, so we feel very good about that. But again, I think it's just a little premature to get too far out in front of ourselves here in terms of what exactly the numbers are going to be.

Got it. Thank you, gentlemen.

Thank you. Our next question is from David Togut of Evercore ISI. Your line is open.

Thank you. Good morning. Could you comment on pricing net of discounting? We're picking up some modest improvement in price increases of 1.5% in our payroll manager surveys, at least from your clients, and I'm curious whether you're seeing that from your broader base of clients as well?

So, the targeted impact of price increases net of any immediate concessions or discounts that we would receive is about 0.5% of our revenue growth and we've that stable for a number of quarters now.

Yeah. I think, our – obviously, we have a much broader dataset than I think maybe the sampling that some folks might do out in the marketplace. But the fact of the matter is I think we have seen really no change in the kind of the environment from a pricing standpoint. I think our intent is to remain consistent which is to remain competitive. As you can see, the underlying inflationary trends with labor costs accelerating a little bit are on an upward trajectory. But these things, they play themselves out over multiple quarters and multiple years. It's not like overnight, all of a sudden the pricing environment changes. But I would say that there's probably – the future appears to have more pricing power than the past in terms of the last decade. But right now, I think no news to report and we would obviously give you kind of a sense if that's beginning to change.

Understood. And then as a follow-up, also in our surveys, we asked your clients about any timeline they've heard of where you're replacing your backend payroll processing and tax filing engine, something you talked about last fall. Only 5% were aware of it. I'm curious if you have a timeline to introduce the new backend payroll and tax filing engines, and if so what is that?

So, the good news is that both of those are actually in production and have pilot clients on them. As we've said I think on a number of occasions, these are back-office systems that are relatively transparent to our clients. In fact, today, our clients don't really have direct contact with our gross-to-net calculation engine and we don't expect them to have that in the future. Now, there will be – the reason we're doing it is, besides the obvious reasons of modern technology being easier to develop on, faster to develop and cheaper to maintain, there will be some enhancements from a client-facing perspective and from an associate service client perspective. But largely, you should think of these as back-office infrastructure that is really not – when someone is trying to hire someone or manage their human capital at their company, typically this is not something that they would be exposed to or that would be transparent to them. Certainly, the employees of our clients won't see any change at all. Our Mobile Solutions are frontend solutions that will be connected back to our new gross-to-net engines. So, I would say, it's mostly positive and we don't expect – I guess, the key is that there's really no, I guess, migration, if you will. We're not going to be sitting here talking about – there will be efforts and costs around the connections to our frontend HCM systems, but there really is no "client migration" that you should be anticipating. And I think I would also add that despite what you might hear from competitors, almost everyone operates with a gross-to-net calc engine that is even if it's in a single-stack technology, it is almost always separate from the frontend HCM platforms as well. So, it's really not – what we're doing is no different than what anybody else would have out there, it's just more on modern stack technology. I think I don't know if you mentioned Lifion, but our kind of low-code platform that we're developing that we've talked about now publicly, that is not a back-office system, that is definitely a front-office facing system, and we do have a number of pilot clients on that as well. And we'll talk more about all of these platforms in the future and their impact on the organization in a positive way at our Investor Day in June.

Understood. Thank you very much.

Thank you. Our next question is from Tien-Tsin Huang of JPMorgan. Your line is open.

Thanks so much. I wanted to ask on the mid-market conversion being done, is it reasonable to expect an improvement in retention from here in your mid-market segment? And I'm curious, does completing the migration also trigger a measurable cost savings from retiring the old platforms?

We are hoping for a continued improvement of retention as there has been clearly impact for clients that had to be migrated, and made choices and decisions to either follow us on that path or not. And so, there should be continued improvement. I don't know if the trend will change in a huge way because we had now, I would say, probably six or seven quarters of improving retention in the mid-market. And so, it should be in the long-term continued improvement because the newer strategic platforms had higher retention rates, and so our plans call for it. But the migration-related impact for – now behind us, long-term, yes. In the short-term, there's no immediate major cost savings for shutting down here and there system, but everything is kind of more a smooth path of continued progress.

Yeah. I think cost – we said this before, when we shut down our down-market platform, this was several years ago, we migrated all of our clients on to RUN. The cost savings from a technical standpoint were in the, call it, sub-$10 million range from a pure platform support standpoint, et cetera. But as you can see from the performance of that business, we haven't talked about the down-market yet, but the down-market just continues to be incredibly successful and a great story for us. And the reality is that the direct cost focus is really not where the money is. The money is in improved client satisfaction, improved retention, accelerated new business bookings, and then just frictional cost in the organization around implementation and service. And so, having said all that, we expect a similar story in the mid-market, but obviously, we just finished like the last client I think last week. And so, it'll probably take – in the down-market as an example, we kind of laid the foundation like we've just laid in the mid-market and it took several quarters if not a year or two before we got real traction, and it was a really great story. And we really hope that we have a repeat of that story, but as Jan said, we have to be cautious because we have to go execute. But this quarter, like all other – like the last several quarters, the retention of our strategic platform in mid-market was higher than the legacy platform that was being retired. But I think what Jan is alluding to is you had two competing forces. One is we had fewer and fewer migrations which was helping the retention rate, but they just also were executing better. They've had many, many quarters in the last – I think in six or seven quarters where retention was moving in the right direction, despite six quarters ago or five quarters ago still very, very heavy migrations in the mid-market. So, hard to tell here exactly what's going to happen, but we're very optimistic.

Okay. Now, we'll consider all that. And then just my quick follow-up on the PEO side with the unit growth breaking below double-digit, is this a sales issue or a secular issue in the 50 and up market for PEO?

I think in the short-term, it's fair to say that it's probably a sales issue, a new business bookings issue. So, I don't think there's really any kind of secular trend. As I think Jan mentioned, we had very, very strong growth and demand still in the down-market under 50, and then this quarter we struggled a little bit in terms of particularly in new business bookings in the mid-market of PEO, if you will. And we're kind of watching that closely. We're kind of looking back at our incentives because, as you know, a lot of the business that we have in our PEO is driven from referrals of our other business units. And so, we have ways of tweaking and adjusting incentives and so forth. But we're frankly pretty – we're never thrilled with a deceleration, we always prefer acceleration. But our PEO is very large, it's the second employer in the United States now, and I think this growth I think is still – in terms of absolute worksite employee growth in dollars still more than any of our competitors. And so, we feel pretty proud of that. And I think the percentage is obviously one way to look at it, but when you look at absolute size in dollars, we feel like we have a really good strong business here and it's performing very well.

Agreed. Thank you.

Thank you. Our next question is from David Grossman of Stifel. Your line is open. David Michael Grossman - Stifel, Nicolaus & Co., Inc.: Thank you. So, Carlos, I think even with the very strong 3Q bookings result, you still need an uptick in 4Q to hit the target for the year. And I think you mentioned the investment and sales head count in the fourth quarter last year is another favorable comp. But is there any way to parse out those factors that you can share? Any other metrics that can help us understand the underlying momentum in the core business? I'm just trying to kind of parse out the impact of sales execution versus product and service.

I think as you're alluding to I think they all have an impact, so it's hard scientifically to kind point to any one single item. But for sure the investments and sales that we made, call it last year, as time goes on those could become more and more productive. Every quarter our sales force is – when we add new people in a step change fashion, become more and more productive. So, I think that's helpful. I think our products are stronger and I think that is helping as well. The comparisons always help, because we're very large and we have a very large new business bookings number. And so, I think the compares have an impact as well. So, I don't know if Jan has any other color, but I think it's probably a number of things, but we're very happy that our productivity as we expected from some of the sales force investments is driving frankly a good portion of our new business bookings growth which is very nice to see.

I can add maybe a number to it David that might help you a little bit. Last year, we grew our head count in our sales force 9% and we are currently at about 3%. So, a large chunk of the growth that Carlos refers to is driven by productivity or new product, productivity being the largest one. We have talked in our last year's investor presentations about our sales channel, sales strategies that we are expanding which are strong focus on expanding our channel strategy. And so, we continue to see, for example, great success with our accountant channel strategy in the mid-market. We are building out an continued success in our inside sales strategy that sells supplemental products to our clients, and that's where we have very predictable and very pleasing results relative to productivity improvement. Those were new associates that came on last year and now they're gaining productivity, and it's a law of large numbers that really executed well. In addition, a component that we haven't talked on a regular basis and doing our investor presentations is our target to drive accelerated new logo growth versus AB (00:41:41). So, historically, we have kind of a balanced mix between 50%/50% relative to new business bookings comprised of being new business bookings driven by new clients, about half of them, and 50% by selling additional product to existing clients. And we have seen now, in addition to this growth that we experienced also a shift to more new logo sales. And it's now more than 60% of our new business bookings have come from new logos, which is a really great complement to the sales force, because we believe being competitive and winning new clients to ADP is a great testament to the competitive of our product set and the capability of the sales force. David Michael Grossman - Stifel, Nicolaus & Co., Inc.: Great. Thanks for that. Very helpful. And just one quick follow-up just on the question about the new products that are being developed, the low code platform and the next-gen processing engine. I know you said you're going to give more at the Investor Day, however can you give us a quick update on what are the key problems that the new platforms solve? And that's whether it's more cost to maintain internally or they're competitive kind of holes that it drills, just trying to get a sense on how to frame kind of the new product introductions and the impact on the business.

Again, we can obviously talk for a long time about that, but I'll just give you two broad themes. One is, I think you ended your question on is it partly competitive and the beginning of your question was really around does it address kind of cost of development and maintenance and so forth, I think those are the two broad categories. In each of these cases with the exception of maybe the tax at the backend, the tax engine, but certainly our new gross-to-net processing engine and our low code platform are all intended to leapfrog the competition in terms of capabilities and flexibility for clients, in terms of how people get managed and how people get paid. And then besides that obviously our business case had very strong expectations around efficiency, I think productivity, and just removing frictional costs that exist as a result of some legacy technology. And obviously, I think you said it also the speed of development, the speed of deployment, and ability to implement changes in a version-less environment is also incredibly powerful. David Michael Grossman - Stifel, Nicolaus & Co., Inc.: Thank you.

Thank you. Our next question is from James Faucette of Morgan Stanley. Your line is open. James E. Faucette - Morgan Stanley & Co. LLC: Thanks a lot. I wanted to go back on kind of the bookings and you've highlighted new drivers, including sales force and that kind of thing. I'm wondering if you can rank order kind of what you think are the contributors from directly where ADP has control on things like sales force versus what's happening perhaps in the economy or in the market as a whole. And it seems like you've talked about retention as being separate factors, but are there any common threads maybe that we can draw between the strong bookings and better retention?

I think that you're onto something that most of us and most people are not onto, which is there's a belief among some of us who have been around for a while that they are very, very closely linked. The momentum, when you have strong momentum in the business, improving satisfaction, improving NPS, improving retention, it has to – the thing is we just don't have any empirical way of drawing the connection, but experience and intuition I think would tell you that there's no question, because we've seen it go the other way as well. So, I think that the company is just experiencing strong momentum on a number of fronts around execution, client service, client satisfaction, et cetera, and that's probably creating a little bit of a halo effect. But from a practical standpoint, if you rank order the sales execution issues, I think the item that Jan brought up is probably the most important one. We talked about, I'd say, probably six quarters ago or four quarters ago when we ran into the very difficult compares of ACA and a new administration that was at least less openly focused on regulation. We talked about having to really refocus our sales force on new logos and on really selling what is now obviously an incredible opportunity to help people manage a very difficult labor environment with tightened labor markets. You saw our National Employment Report today, and it's obviously consistent with the government reports that it's getting hard, so definitely a war for talent on again. So, we were optimistic and hopeful that there was really good opportunity for our sales force to retool and drive new business bookings in a different way, and that's exactly what they've done. Some of it has been through training, some of it has been through product, and some of it has been through incentives. James E. Faucette - Morgan Stanley & Co. LLC: Great. And then just a quick question is, as you've had a chance to digest the change in tax law, et cetera, should we expect there – what should we expect for opportunities for further improvement in tax rate, et cetera, going forward? Thanks.

Yeah. The outlook that I gave of 26% to – what did I say, 25% to 26% beyond 2018, that excludes the onetime items that we typically hunt in our tax reduction efforts, and those opportunities have gotten a little bit fewer as the overall rates have come down and we have less differential between international and the U.S. So, I think the 25% to 26% is a good number. We'll clearly work as good as we can, but that's really an honest forecast of what we're anticipating. James E. Faucette - Morgan Stanley & Co. LLC: Thanks a lot.

Thank you our next question is from Jeff Silber of BMO. Your line is open.

Hey. Good morning. It's Henry Chien calling in for Jeff. Just wanted to follow-up on the bookings question and sort of the improvement that you're seeing in sales and bookings, can you comment a little bit on how much of that you could say is related to competition versus some of the cloud software providers, and if – are those kind of players still having an impact?

Well, we have a lot of competitors in every segment. When we look at the kind of net win/loss ratios, if you will, how many clients we take away from competitors versus how many they take from us, we've seen some improvement in some areas, and then there's a couple that are still difficult. I think that's – those are figures that are also that are somewhat not volatile quarter to quarter, but it changes depending on how strong we are in a particular segment versus one of our competitors. But I'd say, we're overall pretty happy about our competitive position, and it seems obvious that it feels like it's improving, but I think that's about as much color as I can give or should give without crossing the line, because we try to be diplomatic about our comments around our competitors.

Yeah.

Maybe it's fair to say that the competitive environment in this quarter has not meaningfully changed to other quarters. It remains highly competitive.

Yeah. Got it. Okay. Fair enough. And on the down-market and some of the improvement that you're seeing there, is that mostly from a product standpoint or some of the sales efforts that you mentioned with new logos? Just trying to think of how should we think about that. Thanks.

The performance in our down-market is probably the best execution in performance I've seen in my career at ADP, and it's back to an earlier question about connecting it to client retention and other things, there are just so many things that are creating the positive momentum that it's hard to really focus on one specific one. So, as an example, we consider our down-market business to be not just our payroll and HR services for smaller companies, but we also have a Retirement Services business and we have an Insurance Services business that are just really across the board just executing incredibly well, strong double-digit new business bookings growth, strong retention. Our retention in our down-market, for example, is up several hundred basis points over where it was several years ago on a consistent quarter to quarter basis. And of course that helps with the growth, because you don't have to sell as much in order to drive the top line revenue growth, because you're losing less clients. And so, the continuing strength of the new business bookings with the improving fundamentals of that business are just driving really great results, and I think it's just across the board just outstanding execution by all the leaders in those businesses.

Great. That's great to hear. Thanks so much.

Thank you. Our next question is from James Schneider of Goldman Sachs. Your line is open. James Schneider - Goldman Sachs & Co. LLC: Good morning. Thanks for taking my question. I was wondering if you could maybe return to the new bookings detail that you provided earlier. I think you called out strengths in the down-market and also some strength in international. Can you maybe talk about what was driving that, but also touch on what you saw in the mid-market bookings? And whether you think that after the platform transition – with that now complete, whether that can improve in the coming quarters?

Yeah. I can give Carlos a little break here. Part of the good news about the new business bookings is that we saw really meaningful improvement across all channels across the board. So, it was not focused only on the down-market. The down-market had a good performance and continue to do it, but it was really mid-market, up-market, international, they all contributed to growth in the new business bookings quarter if you look by each of the channels basically that we have. So, the broad-based, and in the mid-market, there's really on the sales process not a change, and the migrations haven't really affected in a sense the product offering in the mid-market. We have been selling Workforce Now current version, our cloud-based leading product, and that has been very competitive and continues to do well in the mid-market. So, it's hard to point really in the quarter a particular stand out, because the performance was really solid across all segments, Jim.

I will say that in the mid-market as an example, this happened a little bit in the down-market also when we were doing the migrations of our legacy technology, our sales force does sometimes get distracted when an existing client still has a relationship with a sales rep and they call the sales rep, because they're being told they have to migrate to a new platform, and there's that distraction. Now, sometimes that historically provided opportunities also for our sales force to sell additional products as a client was migrating to the new platform. So, there's puts and takes, but it's going to be a lot less distraction, that's for sure. James Schneider - Goldman Sachs & Co. LLC: That's helpful color. And then maybe just as a follow-up to the point you just made, Carlos, I would have normally expected that there could have been a little bit of a risk to the retention metrics in the mid-market as you complete that transition. Obviously, that didn't happen. So, can you maybe give us a sense about like what tactics you may have used to kind of keep those retention numbers up in the mid-market? And whether you think those can be kind of more broadly applicable across the board? Is it service continuity, realignment or something else?

I think the tactic was smart, dedicated people who were very creative. And so, as we kind of came out of some of the big challenges we had when we had to accelerate in a very large and meaningful way our migrations due to ACA, because our ACA products were only available on our new platform, I think what that taught us was when you think about the lifetime value of these clients using what they called a white-glove service approach to the migrations really made the difference in terms of not having the losses be as big as they could've been. We clearly experienced heavier losses in the legacy platform because I just mentioned that our retention rates are higher in our current version platform than in our legacy platform, but they could've been a lot worse. And so, I think it was just great execution, great commitment, and good creativity around frankly just swarming those transitioning clients with a white-glove service in order to try to minimize the negative impact of the migrations and it really did work. So, hats off to the leaders there. James Schneider - Goldman Sachs & Co. LLC: Good to hear. Thank you.

Thank you. Our next question is from Mark Marcon of R.W. Baird. Your line is open. Mark S. Marcon - Robert W. Baird & Co., Inc.: Hi. Good morning. Just wondering if you could just provide a little bit more color with regards to the source of the new logos? Specifically what I'm wondering is, are you seeing an expansion of new logos that maybe coming not necessarily from traditional competitors, but maybe some other players that are out there? How would you characterize some of the new logos? And then I have a follow-up.

Again, just because I hate to be a broken record, but when we look at both our losses and also our new logos, we are so broad-based and we have so many competitors that – I think I've said this before that there's really a couple competitors, for example, who in the up-market come close to maybe 10% of our losses, but nobody is really kind of that meaningful, and I think it's even more true in the mid-market that there isn't one specific competitor that accounts for a great deal of our losses. And then, it's the same thing with new business bookings. But I think it's safe to say that some of that stuff is related to market share. And so, our biggest competitors generally speaking would be ones where we would lose the most clients to, but also we have a lot of success in pulling clients. That obviously varies by segment, but I think directionally that's true, and the difference maker in each case is really the execution of the sales force. Mark S. Marcon - Robert W. Baird & Co., Inc.: Okay. And then with regards to nationals, there have been some discussion about expanding your push with Workforce Now up there. Can you talk a little bit about that and what you're seeing on Workforce Now internationals versus Vantage?

Yeah. We had the Workforce Now product being offered I think for the last two years now in the up-market, and the new logo growth that Workforce Now for clients above 1,000 is incremental to new logo growth that Vantage continues to achieve. So, the combination of both of them has helped our broad-based acceleration of new logo growth.

And we definitely – I think it has been something that we had available and it's helped us compete in kind of the low end of the up-market for a few years. But I think it's safe to say in the last year or so, we kind of doubled-down a little bit, and put more focus and more emphasis, and I think it's having the desired impact. Like our – and there are a few competitors in particular where Workforce Now lines up very, very strongly in the lower end of the up-market and I think that strategy is working. Mark S. Marcon - Robert W. Baird & Co., Inc.: Great. Thank you.

Thank you. Our last question comes from the line of Matt O'Neill of Autonomous Research. Your line is open.

Yes. Thank you. All my questions have been asked and answered.

Thank you.

Thank you.

Thank you. And that does conclude our Q&A session for today. I'd like to turn the program over to Mr. Carlos Rodriguez for closing remarks.

So, just a couple of final comments, I terms of looking at the – obviously, we've had a lot of achievements this year and we're pretty happy about the momentum we have, and I think it demonstrates the strong culture that we have at ADP and it's one that we're not afraid to change, but we want to do so in a thoughtful, orderly and balanced way. With these migrations done in the mid-market and the progress we're making with our Service Alignment initiatives and the early retirement program, among some of the other initiatives that you'll hear more about at the June Investor Day, I just want to again reemphasize how proud I am of our associates and all of these efforts of the things they're doing to really protect and enhance the value of ADP. I also want to make sure I mention that besides the dividend increase, which I think is great news for shareholders from a governance standpoint, we did add two new board members who bring a lot of experience, both operationally and transformationally to our board. And I look forward and I know the rest of the board looks forward to working with them as we build a brighter future for ADP. And with that, I'll thank you for joining us and we look forward to seeing you at our Investor Day in June.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude today's program and you may all disconnect. Everyone, have a great day.