Good day, ladies and gentlemen, and welcome to the Amdocs First Quarter 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. As a reminder, this conference is being recorded. I would now like to hand the floor over Matthew Smith, Head of Investor Relations for Amdocs. Please go ahead, sir.

Thank you, Karen. Before we begin, I would like to point out that during this call we will discuss certain financial information that is not prepared in accordance with GAAP. The company's management uses this financial information in its internal analysis in order to exclude the effect of acquisitions and other significant items that may have a disproportionate effect in a particular period. Accordingly, management believes that isolating the effects of such events enables management and investors to consistently analyze the critical components and results of operations of the company's business and to have a meaningful comparison to prior periods. For more information regarding our use of non-GAAP financial measures, including reconciliations of these measures, we refer you to today's earnings release, which will also be furnished with the SEC on Form 6-K. Also, this call includes information that constitutes forward-looking statements. Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that our expectations will be obtained or that any deviations will not be material. Such statements involve risks and uncertainties that may cause future results to differ from those anticipated. These risks include, but are not limited to, the effects of general economic conditions and such other risks as discussed in our earnings release today and at greater length in the company's filings with the Securities and Exchange Commission, including in our Annual Report on Form 20-F for the fiscal year ended September 30, 2016, filed on December 12, 2016. Amdocs may elect to update these forward-looking statements at some point in the future. However, the company specifically disclaims any obligation to do so. Participating on the call with me today are Eli Gelman, President and Chief Executive Officer of Amdocs Management Limited; and Tamar Rapaport-Dagim, Chief Financial Officer. And with that, I'll turn it over to Eli.

Thank you, Matt, and good afternoon to anyone joining us on the call today. We are pleased with our first quarter results, which reflect record revenue above the midpoint of our guidance, adjusting for currency, as well as consistent execution across multiple dimensions of our business. For instance, we maintained a high win rate, which included pivotal transformation deals with Vodafone Italy and with a leading communications service provider in Southeast Asia. We renewed managed service arrangements with several customers that strengthen the basis on which we expect to expand the scope of future activities. And we made significant progress in the field of Network Functions Virtualization, NFV, one of our important long-term growth engines. The majority of fiscal 2017 still lies ahead of us, and we are cognizant of the ongoing challenges presented by the global macroeconomics and industry environment in which we operate. That said, our strong quarter one results and the visibility provided by our unique business model now supports a slightly stronger outlook for constant currency revenue growth this year. This outlook also appears more balanced across regions than we originally anticipated. With that in mind, let me review our first quarter performance on a geographical basis. Beginning with North America, we saw further signs of stabilization as we supported strategic initiatives for customers, such as Charter Communications. As we highlighted on our Analyst & Investor Day in mid-December, Amdocs Solutions and Services are playing a key role in helping Charter provide uniform and enhanced customer experience following its acquisition of Time Warner Cable and Bright House Networks. Regarding the outlook for North America, let me take a moment to share our thoughts on three major trends we believe will affect the North American market dynamics over the next several quarters. First, the modernization trends among…

Thank you, Eli. First fiscal quarter revenue of $955 million was at the midpoint of our guidance range of $935 million to $975 million, despite a negative impact from foreign currency fluctuations of approximately $7 million relative to the fourth fiscal quarter of 2016. Our first quarter guidance range had included the margin of sequential negative impact from foreign currency fluctuations. Revenue performance was, therefore, above the midpoint of our expectations after adjusting for the foreign currency fluctuations. Our first fiscal quarter non-GAAP operating margin was 17.2%, an increase of 10 basis points compared to the fourth fiscal quarter of 2016 and within the higher end of our long-term target range of 16.4% to 17.4%. Below the operating line, non-GAAP net interest and other expense was $2.8 million in Q1, primarily reflecting foreign exchange movements. For forward-looking purposes, we continue to expect the non-GAAP net interest and other expense in the range of a few million dollars quarterly due to foreign currency fluctuations. Diluted non-GAAP EPS was $0.90 in Q1, at the midpoint of our guidance range of $0.87 to $0.93. Our non-GAAP effective tax rate of 17.2% in Q1 was slightly above the high end of the annual target range of 13% to 17%, consistent with our guidance. Diluted GAAP EPS was $0.66 for the first fiscal quarter, towards the high end of our guidance range of $0.59 to $0.67. Free cash flow was $127 million in Q1. This was comprised of cash flow from operations of approximately $168 million, less $41 million in net capital expenditures and other. As we disclosed at our Analyst & Investor briefing in mid-December, we expect to generate free cash flow of approximately $500 million in fiscal 2017. Additionally, we remind you that free cash flow in the second fiscal quarter is typically…

Thank you. Our first question for today comes from the line of Shaul Eyal from Oppenheimer. Shaul Eyal - Oppenheimer & Co., Inc.: Thank you. Good afternoon, guys. Congrats on continued solid execution.

Thank you. Shaul Eyal - Oppenheimer & Co., Inc.: I know, Eli, you've touched on the ECOMP topic during your prepared remarks, but I wanted to spend another minute on the topic. In my view, it is becoming very important, crucial, longer term. So as you mentioned, I believe, earlier this week, you've announced the collaboration with Orange. I think that was in Poland. A few weeks back, you've announced the Linux collaboration, also, on the ECOMP front. I recall one of the advantages of the ECOMP announcement with AT&T last year was the fact that there's no exclusivity here, so you can take it in any direction. So my question is, how many additional large service providers and strategic partners are looking at ECOMP right now? And how do you see your NFV ecosystem developing in 2017 and beyond?

So, Shaul, it's evolving. It's evolving fast. So anything that I'm telling you today may change, I think for the better. In the future, the way it looks right now, it seems like people, that is to say communications service providers around the world, are getting more excited about the idea that ECOMP may turn to be some kind of a standard. And since the standards bodies cannot move as fast as we can, this is IEEE or SE and other standards bodies, we believe that adoption of ECOMP is quite important for the future of ECOMP and beyond AT&T and others. So the fact that Orange announced it already and the fact that Bell Canada announced already that they are looking into it and may adopt it is a very good sign. There are several other major carriers around the world that are looking into open ECOMP as a standard for them. And I think that more companies will join this consortium, so to speak, as we speak. We believe as an IT company we have a significant advantage because we developed significant parts of it, and we hold the type of engineers that are required for additional development, for execution, for the enterprise version of it, the testing of it, and many, many other services around it. Now, since it's only in the beginning, it's a topic in its infancy, as a matter of fact, it's hard for us to quantify it, but the trend is positive. I think the speed is also picking up. And I expect other companies to – other communications providers to follow. Hopefully, while they are following we will be able to take along our services and capabilities and create more projects like the one that we just announced with Orange in Poland. But the overall direction is to implement the same services across the Orange network. Shaul Eyal - Oppenheimer & Co., Inc.: Got it. Thank you so much.

Thank you, Shaul.

Thank you. And our next question comes from the line of Ashwin Shirvaikar from Citibank.

Thank you, and my congratulations as well on the quarter. I guess I wanted to ask you, you had your first success here with Comverse. Is there more detail potentially available on the sizing of what happens when a traditional Comverse client takes up sort of the full Amdocs portfolio, in terms of its contract size as well as scope, ability, what kind of ramps? That seems like a fairly complex – given the simplicity of the platform that they're on, it seems like a fairly complex long-term project. So I'm trying to figure out size, timing, things like that.

So, Ashwin, it's a very good question. Let me try to shed some light and comparison. When we are talking about an end-to-end CES platform, we are talking about at least four or five major components, which includes the revenue management, the customer management, in this case the digital component, self-service, e-commerce and so forth, product catalog, ordering, and a few others. When you compare it to the Comverse assets, primarily Comverse assets is a revenue management engine. So by definition, transforming a company that had Comverse as a revenue management component before, if it's an end-to-end, it's bigger than the Comverse spec. Specifically to this project, it's complex one. It's on a high speed or short duration of transformation. It includes the digital front of it, as well as all the other components that I just mentioned. So it's bigger than average deal. And it's a good indication because we saw some additional services we saw the Comverse former customers. We sold some services. We are adding add-ons like Pontis or other components. But this is kind of the first indication that we have that from the top customers of Comverse, some of them will transform to CES 10 over time, and this is a very good indication that kind of solidified this vision.

Okay, okay. That's good to know. On the rest of world growth, I missed what you said for what the growth expectation exact number was. Can you explain the dynamics of why there are delays in LatAm, if I heard you right? Also, over time, is there a chance to convert rest of world to more of a managed services instead of project-oriented market?

So for the first component of the question on rest of the world, I would say that we have basically predicted that a couple of quarters ago, and we have seen some kind of a variation between the two ends of the world, so to speak, okay, the two emerging markets. And while Asia-Pacific, because of regulations in India, because of more competitive markets in Indonesia, in Malaysia, in other places, in Korea, and other places, we see more bids and more activities going on across the region, including Thailand, including other places. We see less of this in Latin America in recent quarters. I think it will – some of it will come back. Now, some of the delays that I'm talking about in Latin America fluctuate. The macroeconomics in Latin America right now specifically in Brazil and Mexico, which are the two largest economies, are not so good. So it affects, obviously, the pace of decisions. If you add to that political stability, or instability, in some other countries, it affects the overall region. But we have seen this region fluctuating in terms of the macroeconomics and the cycles before, and it changes almost on a quarterly basis. So I'm just basically saying that everything that we said before, at least, twice in the Analyst Day and previous quarter, of the different dynamics, of the different two markets, which comprise the rest of the world, we see more of it. Overall, rest of the world will be a growth engine in 2017. And even this prediction that I've just depicted may change in a quarter or two. The overall growth of rest of the world will not be as strong as it was in previous years. And again, it's something that we alluded to already in the Analysts Day, but we see it even stronger in the last couple of months, that – which is a good thing that at the end of the day we see a much more balanced growth dynamics among the three major regions, if you want to call it this way. Within the past two years, we had relatively slow growth and sometimes no growth in North America and we compensated with that with a strong – sometimes very strong growth in rest of the world and somewhat in the Middle and Europe. Now we see dynamics that we see growth in North America, in Europe and in rest of the world in different maybe pace. Altogether, that reflects the projections that we are giving with a slight raise of the guidance. So altogether, I think it's actually a good thing, and...

And, Ashwin, on the managed services point, we definitely believe this is the ideal conversion we'd like to see where, typically, a relationship with a customer would start through a modernization and transformation. And later on, as the relationships are being built and we show the value, the customer will adopt the managed services model. We see more and more indications that this can be done also in the rest of the world region, as well as Europe. So some examples we shared in the past. Yet, we have not converted all of our customers, of course, to managed services, so the potential is definitely there. And in the cases where we've done so, we already start to see, again, it's still relatively small size because of our relatively late entry into those regions, but we already see even renewal points coming up and extensions and expansions of the managed services activity with customers that we've managed to shift into that model.

And the timing is also reasonably fit to the model because it takes a few good years to create the stability of the operation and the trust in the region, so to speak. And we have been in these regions for, in a serious way, only in the last few years. So you can expect this trend to take some time. It took us the same amount of time in North America, in Europe, and so on and so forth. So we expect it to happen. We see some of it already, some of it happened, but I think it will continue to happen. And as Tamar said, the dynamics and the characteristics are very similar to what we see from other places of the world. So we are quite encouraged that we can eventually have a more significant managed services business in the rest of the world as well, both rest of the worlds.

Thank you. And our next question comes from the line of Jason Kupferberg from Jefferies.

Hey. Good afternoon, guys. I just wanted to start with a question about the uptick in the constant currency revenue growth guidance here. I know you called out some further signs of stabilization in North America. And I think you mentioned some newer work with Charter. I mean, is that the primary dynamic here, driving that 50 basis point increase? Or did something get incrementally better outside the U.S. as well?

It's a combination of things, I would say, but the indications we're having from North America stabilization as well as the progress we're seeing with the Pay TV market in North America is definitely a good sign. But there wasn't any singular event we should point out in that context. I would say more a combination of a couple of things.

Okay. And just on the prospects of U.S. tax reform, are there any implications for Amdocs? I mean, as a foreign filer, I'm not sure exactly how it might impact you, or not just corporate tax reform, if there's border tax adjustment or things like that that end up getting enacted? What are some of the scenarios we should be considering?

So I think it's still too early to understand which one of the tax reforms that if you're looking on the House proposals versus Trump campaigns, of course, there are many variations there. But in general, I would say given the fact we are a multinational that is not domiciled for the U.S., our situation is different, naturally, than maybe the other companies you're looking at. And what we are seeing in general around tax and then taking it to the broader global perspective is definitely more and more attention globally on the topic, coming from the EU all the way now to the U.S. awakening to talk about that, and of course, other countries as well. So it's something we're tracking very carefully. We cannot predict all permutations of legislation that will go through, but given what we know now, we believe the range we provided of 13% to 17% is a reasonable range to look forward to.

And just last quick one, the Vodafone Italy transformational deals there, I mean, are those needle moving this year? I mean, is that a little bit of a contributor to the guidance raise, too? I was just trying to get a sense of the size, given that they are in that transformational projects?

I would say somewhat, but the given nature of how transformation projects work, and if you consider the fact that it usually starts with high-level design and then the detailed design, where this is not the vast majority of revenue, actually, the mass – the vast majority of revenue comes later in as the pickup of work begins. So maybe in this case, for example, it should have an impact more towards the latter part of the year, but in general it is a sizable project. It's something that we are definitely encouraged to see and very focused, of course, in general on the Vodafone Group and our execution ability there.

As Tamar said, Jason, as Tamar said, the guidance is comprised out of many, many small details, but obviously, two major project with two of the largest MSOs in North America and a lot of project with Vodafone and many project with Telefónica and it adds up to this thing. So the rate itself is a combination of many things. The wins that we mentioned are – and we use the word pivotal is because of size, but also because of importance in terms of transforming a whole market. We have seen it when we entered the Indonesian market or when you entered the Dutch market or whatever, I mean, the first project in such a market is usually quite significant for the market, and surprisingly, this is our first project in Italy, so – in terms of size. We have some projects, of course, and some keener assets (36:06) there and so on and so forth, but in terms of size. So it has many dimensions why it's important and it mainly means that we would sweat some more to execute this project along with the other projects that we have.

Thank you. Our next question comes from the line of Tom Roderick from Stifel. Tom Roderick - Stifel, Nicolaus & Co., Inc.: Hey, guys. Good afternoon. Thanks for taking my question. So, Eli, can you clarify your comments on just how North American M&A might be impacting your outlook today? I mean, obviously, there's been plenty of rumored combinations but, of course, nothing that's official or on the tape yet. But are you already seeing an impact in customer spend? Or do you anticipate seeing that this year as perhaps some of those customers prepare for or contemplate potential combinations? Or are you just simply reminding us that, hey, your customers do from time to time engage in M&A, and when that happens, they often take a pause in spending? Can you just clarify your comments there?

Yes. It's not that we see right now significant slowdown or acceleration per se. On the other hand, I actually strongly believe that the major MSOs of North America are investing in their customer experience infrastructure for the long term and maybe even beyond the pure, plain cable services. Both Charter and Comcast and DIRECTV and the other companies are becoming more and more integrated carriers. They have broadband. They have video. They have content in a growing way. And they all have accelerating their mobility component. If they may decide to accelerate mobility to the level of acquisition, there are a few assets available in North America, by the name of T-Mobile and Sprint. And I'm not trying to speculate, but I would not be surprised if these two companies will try to merge mobility and video and maybe later stage content to create the same integrated carrier vision that AT&T has in North America, that Vodafone has in other places, and so on and so forth. So it's not like we are seeing specifically immediately related activities, but I think that my analysis of the reason why we see this type of a transformation in the MSOs also has to do with potentially preparing themselves for M&A in different shapes. Now, in Charter it's clear that already it's given, and it's in the broadband and video space. But Charter also is accelerating its MVNO capabilities. And as such, we think that there is a potential for more business there. Comcast may do it for a different business, and DIRECTV have their own view. So each one of them is doing it differently. And of course, the market will have a lot of rumors of almost any permutation you can think of. But we believe that the integrated care is the direction of the market all around the world, especially in North America, and that's basically what we tried to share with you. Tom Roderick - Stifel, Nicolaus & Co., Inc.: Outstanding. That's really helpful. The second question I had for you, Eli, here is just on the topic of Charter itself. You highlighted that win as one of the reasons why North America is looking up in your constant currency guidance. Can you just talk a little bit more about what it is exactly you're doing for Charter? Understanding that they have a pretty complex and fragmented backend billing environment across Charter, Time Warner, Bright House. Where do you sort of sit in that hierarchy and – or perhaps sitting over the top of it? What will that offering look like as you work with Charter going forward here?

Well, it's not that they have a very complex and sophisticated back end. They have a very old one. The only thing that you can say about it is that it's very old and they understand it. It's a limitation or it's a potentially – a slowdown for their progress. So basically, the idea in Charter, because they have three companies they need to integrate, is that we are building with their IT a platform that encapsulates their entire system that is wrapping, basically, their old legacy. Some legacy will be replaced; some legacy will just be wrapped. And all the rest of their layers are completely new components of CES 10 components, like – such as product catalog, customer management, digital, and so on and so forth. So basically, we believe that we are building the future architecture of Charter, and it is a quite significant project for them and for us. And it's quite important one because it allows Charter to have a look and feel of a modern digital company, despite the fact that they are – they bought pure (42:17) assets and that is expandable also – for if there was – do other acquisition or move faster into newer areas. So that's more or less what we're doing in Charter, and the rest of it, I'm afraid you will have to ask Charter to give more details because I'm not sure that they want the whole architecture out there.

Thank you. And our next question comes from the line of Will Power from Baird. Will V. Power - Robert W. Baird & Co., Inc.: Great. Thanks. Yeah. Just a couple of follow-up questions. Maybe just to come back to Vodafone. It seems like these different Vodafone properties kind of percolate from time to time, and I guess I'm just trying to get a sense for whether we could see the Vodafone opportunity accelerate in other regions. How many more regions are there to work with? Maybe just give us a sense for the scale of the upside opportunity there, because it seems there's still a lot of, at least in the Northern side or a number of the properties you're not touching actively today.

Of Vodafone you mean? Will V. Power - Robert W. Baird & Co., Inc.: Of Vodafone, yes.

Within the Vodafone Group, yeah. And look, it's a huge and fantastic company, a very intelligent company, too, and they work in many, many markets. We do a lot of activities with Vodafone in India, which is a very important growth engine for them. In India, they have 22 markets or 22 as we call it circles, all consolidated on Amdocs CES platform with some managed services activities and so and so forth. We have a lot of activities with Vodafone basically end-to-end entire CES 9 in the Netherlands for post-paid and prepaid and now Vodafone is contemplating to join forces with Ziggo as a cable company or video, which is a joint venture with LGI, Liberty Global. We have a lot of activities in the UK, a lot of activities in the mobility only, in Germany, in Turkey, in Greece, in Spain, mobility and on – I mean like I can go on and on and on. We have a lot of activities in Vodafone. We usually talk usually about the recent projects, and we are now working, as I said, diligently to execute some of the recent wins from the last year and preparing in parallel to this new project in Vodafone Italy that we take very, very seriously. So it's a significant project for all parties involved, and we are definitely very proud to win it. It was a long process, highly competitive. You can expect something of this size in the middle of – for Vodafone, in the heart of Europe, you would expect anyone and his wife to show up for the bid. And the fact that we won it is a great indication for our strength.

I would just like to add, Eli, that the multiple dimensions of growth, one that you mentioned is to sell in to new affiliates of the Vodafone Group. But other important dimensions of growth for us within the Vodafone Group could be selling additional product models. For example, if we sold our customer management capabilities in a certain affiliate and now they're thinking about how they're moving to the digital front end in a multi-channel way, or any managed services could be, for example, an expansion of the footprint within a certain affiliate. So there could be different dimensions of growth for us within Vodafone where adding new logos within the group is just one of them.

Well, unless they will keep on buying companies, eventually, the number of logos are finite, of course. Will V. Power - Robert W. Baird & Co., Inc.: So just thinking about other products generally, and not just with Vodafone, I mean I'm not sure I've heard an update on this recently, but thinking about – I think it was about three years ago you completed the – what, the Celcite and Actix acquisitions to move more into RF engineering network management. Any update as to how those products are working? Are those off and integrated in some of these new wins? Just maybe any update or thoughts on the momentum there.

Well, so you see, in general – first of all, I'll give you the general answer. In general, the more offering we add, the more potential we have to expand our relationship over time with customers, because if in the past we have mainly revenue management and customer management and then we added ordering and then OSS and then radio optimization and then e-commerce and on and on and on, the notion is that the industry is relatively concentrated by the nature of it and becoming even more concentrated. So the logic that we have is that we want to expand into new buying centers with the different vehicles, the different tools that we are either developing or acquiring or both. And we have seen it in many customers, such as AT&T, such as certain companies within the Vodafone, Telefónica, and others. Specifically on the radio optimization, run optimization, we're actually progressing quite nicely. We developed a few more features of this product in western deals (48:11), and we're expanding with some specific customers. Not all around our customer base, so that's eventually potential. You have to remember that in most cases, this subject is usually part of the radio network itself, that one of the NEPs would sell to a given communications service provider. So if someone sell, let's say Nokia sell their equipment to Telefónica, and then they will have initially the network optimization from Nokia in this case. But over the years, we added more and more features into our radio optimization and it became the strongest in the industry. But it's a slow process to convince network guys to turn over such a delicate and important function in the network to an independent supplier like us. Specifically, I would say, one of the areas that we see great success is in Latin America and specifically, within Latin America, even more so with América Móvil than with anyone else. América Móvil is really running a very tight ship when it comes to network, network deployment, network optimization, optimization on a broader context, not only the radio access, but also the backhaul and some servers. So they are very advanced and like an early adopter of new technologies and we have a great progress with them. But we have it in many other places, and I believe it will keep on expanding. So that's just one more vehicle that we have that we can sell eventually also to Vodafone in certain geographies. And each one of the geographies will act differently because it's a regional decision. It doesn't have to be a corporate decision.

Thank you. Our next question comes from the line of Sterling Auty from JPMorgan.

Hi, guys. This is Jackson Ader on for Sterling tonight. Just quick questions from us. What specifically drove the cash collection issues in this quarter?

I wouldn't say it's collection as much as it's about the gap that we have within transformational projects between the pace of recognizing revenue based on progress of the project and when you hit the invoicing milestone, which is a natural thing that is just built into the project life cycle. So it's not a matter of having an issue in getting cash out of our customers once the invoice is due. It's more about when we are getting into that, and that's also reflected, if you've seen, in the change we talked about in billed AR, which is another reflection of the same point.

Got you. And then so would we probably expect that seasonal cadence in free cash flow through the year? I know we expected a sequential drop in the second quarter, but probably, is it safe to assume it may not be as exaggerated as it has been in years past?

I think you should look at it more as a stronger half two, just because of the natural seasonality we usually have in Q2 with the bonuses payments done. So therefore, if you look from the trend point of view within the year, second half is stronger.

Okay. All right. Thanks, Guys.

Thank you, Jackson.

Thank you. And that concludes our question-and-answer session for today. I would like to turn the conference back over to Amdocs for any additional comments.

Thank you very much for joining our call this evening and for your continued interest in Amdocs. We look forward to hearing from you in the coming days. And if you do have any additional questions, please give us a call at the Investor Relations group. And with that, have a great evening, and we'll talk to you soon.

Ladies and gentlemen, thank you for your participation on today's conference. This does conclude the program, and you may now disconnect. Everyone, have a great day.