Good afternoon, and welcome to the Flex Second Quarter Fiscal 2018 Earnings Conference Call. [Operator Instructions]. At this time, for opening remarks and introductions, I would like to turn the call over to Mr. Kevin Kessel, Flex's Vice President of Investor Relations and Corporate Communications. Sir, you may begin.

Thank you, and welcome to Flex's Second Quarter Fiscal 2018 Conference Call. We appreciate everyone that made the time to join us today. We have published the slides for today's discussion. They can be found on the Investor Relations section of our website at Flex.com. Joining me on today's call is our CEO, Mike McNamara, and our CFO, Chris Collier. Following their remarks, we will open up the call to questions. Before we begin, let me remind everyone that today's call is being webcast and recorded, and contains forward-looking statements which are based on current expectations and assumptions that are subject to risks and uncertainties, and actual results could materially differ. Such information is subject to change, and we undertake no obligation to update these forward-looking statements. For a discussion of the risks and uncertainties, see our most recent filings with the SEC including our current annual and quarterly reports. If this call references non-GAAP financial measures for the current period, they can be found in our Appendix slide. Otherwise, they are located on the Investor Relations section of our website along with the required reconciliation. I would now like to turn the call over to Chris Collier. Chris?

Good afternoon, and thank you for joining us today. We'll start on slide 2 with our second quarter fiscal 2018 income statement summary. Our second quarter results reflect our structural portfolio evolution, continued growth, and continued capital return commitment. The second quarter's performance was broadly in line with all of our key financial metrics we had provided back in July. Our net sales totaled approximately $6.3 billion for the quarter, up 4% versus a year ago, and toward the high end of our guidance range. All four of our business groups exceeded the midpoint of their respective quarterly sales guidance ranges. Shortly, Mike will provide additional insight into our business group revenue and the demand environment. Our second quarter adjusted operating income was $188 million, which was above the midpoint of our guidance range and reflected a 4% decrease from a year ago. Adjusted net income was $142 million. Our adjusted earnings per diluted share for the second quarter was $0.27, which was towards the high end of our guidance range, and our GAAP EPS was $0.38, as we benefited from a large non-cash gain which I'll explain further when discussing our other income statement highlights. Now, turn to slide 3 for our quarterly financial highlights. Fiscal 2018 is reflecting a resumption of top-line growth, as we realized the monetization of significant bookings and new business wins we've been capturing from our Sketch-to-Scale portfolio shift and our expansion into new businesses. Our second quarter adjusted gross profit totaled $417 million, and our adjusted gross margin was 6.7%. As discussed at our investor day in May and again last quarter, fiscal '18 is an investment year and again, that was reflected this quarter as our increased investments and costs resulted in a 20 basis point decrease in adjusted gross margin compared…

Thank you, Chris. Our second quarter was a strong indication that Flex's top-line growth, structural portfolio evolution, and capital return all remain on track. Please turn to slide 8 for Q2 fiscal 2018 business highlights. Q2 results were solid, with our revenue and adjusted EPS at or near the high end of guidance ranges. We had impressive revenue performance across the board, as all four business groups achieved sales above their respective guidance midpoints. Q2 also marked our third straight quarter of year-over-year revenue growth and we remain on track for fiscal 2018 revenue growth. Even more importantly, our structural portfolio evolution continues to gain momentum. Our HRS and IEI businesses are displaying accelerated double digit, year-over-year revenue growth. We remain very confident that both will achieve greater than 10% revenue growth in fiscal 2018. As discussed last quarter and at investor day, their continued strong new bookings and expanded Sketch-to-Scale relationships are providing sustainable growth and an improving outlook. These two business groups anchor a majority of our anticipated earnings improvement to achieve our fiscal 2020 targets, so it is encouraging to see them performing so well. Our other two business groups also performed at the high end of their respective revenue targets. CTG was up more than 5% year-over-year versus expectations of flat to up 5%. CEC was down nearly 10% versus expectations of down 10% to 15%. CTG continues to invest and ramp up its important strategic partnerships with Nike while still improving their sales mix and growing other important sketch-to-scale customer relationships. Despite the secular pressure in many of CEC's legacy end markets, it continues to expand its design capabilities and grow its customer base, focusing on cloud data center and converged infrastructure. CEC remains an important asset which provides us with a strong free cash…

[Operator Instructions]. Your first question is from Steve Milunovich from UBS.

Two questions. First of all, on Nike, if you could be any more specific in terms of where we are in moving into the Dream Factory, I think you said you would begin in October. It sounds like that's happening. At what point do you have the majority of the ramp done basically? Maybe you can talk about how you're making shoes in the other plant, and moving it over? Sounds like you're on track for a kind of break-even in March. And do you plan to get to your goal of 75% automation? And then second, you've mentioned some large programs being launched. Can you be more specific about where those reside, or what those are, specifically?

Yes, let me talk a little about Nike, first. Yes, to move into a factory that size, you don't do it all in one month. So, we've been moving in over the last couple months. We're substantially complete at this point, we'll be complete by the end of the month, and that's going on track. So, the timing is right. We're obviously excited about it. You called it the Dream Factory, I like the way you describe that. As we move towards into that factory, we're excited, just very pleased because the opportunity to optimize workflows and lay everything out instead of splitting around a bunch of different factories is really going to be extremely -- a big advantage for us going forward. As far as the degree of automation, are you specifically asking, Steve, about the degree of automation in that factory?

Yes.

So, it's hard to put an exact number on it. Different processes and different shoes are going to have different degrees of automation, and it really depends on the mix. So, we continue to innovate around a number of different processes. That continues to go very, very well, but it really depends on the mix in that. So, I think it's hard to really quantify the 75% number, so I can't either confirm or deny the 75%.

Steve, with regard to your question around the large ramps, we're extremely pleased with this being pretty broad. It's across basically every one of our segments, is having some sizeable ramps. I think most notably would be inside of our IEI and HRS, and there's some significantly higher ramps inside of the IEI that I'd call it out in my prepared remarks as did Mike. You know, I notice they're centering more around some of our industrial companies, some of our industrial partners, some of our home and lifestyle partners, and so not to be specific around any one customer, but those are the categories that are seeing that. It's really evidencing itself in terms of that sizeable growth that we're guiding to in December of sustaining.

The next question is from Adam Tindle from Raymond James.

I wanted to first ask about where you think we are in terms of the operating profit dollar declines that we've seen so far this year. It appears that this trend has bottomed in the September quarter based on your guidance. Revenue continued to grow and operating margins seem poised for continued sequential growth. So, can you talk about the puts and takes to grow operating profit dollars from here, and how the potential for fiscal 2019 profit dollar growth compares to recent years?

Surely, let me try to frame up a couple PPs this year. Really, the operating profit bottomed in Q1. Obviously we just had a nice sequential growth, over 6% in Q2 print and at the midpoint of our guidance in Q3, it puts us up a nice sizeable, near 15% growth also from there. You know, there's several distinct levelers, for me, for margin and operating dollar expansion as we move forward. It's reflected in kind of how we've been talking about the business. But I think that strategically moving to a greater concentration of earnings from IEI and HRS in the richer business mix that's coming inside of CTG, coupled with the improving earnings profile with our Nike relationship, those are obviously some meaningful levers there. I think we're starting to benefit from some top-line growth that's re-emerged this year. Fiscal '18's growing, and each quarter we're displaying accelerated year-over-year expansion which provides us some leverage on our structure. I also think that it shouldn't be overlooked as you get out into '19 and '20 and beyond, you're going to continue to see greater Sketch-to-Scale penetration, and with that comes more meaningful design, engineering, and technology content in our offering, all of which will contribute to an uplift in terms of margin and profits. And you know, you're going to see the company as it moves from this investment year, shifting from a creating and ramping and development of different initiatives in technologies and so forth, into one that's scaling and expanding. So, those are at a high level, some of the distinct levers that you should think about as you construct out the path forward from here and into the next years.

Okay, that's helpful, and you mentioned that obviously Nike had a lot of positive commentary on the relationship at the analyst day yesterday. They decided to disclose an expectation for Flex to produce over 3 million pairs in fiscal '18 and tens of millions five years from now. Can you help us understand how we can think about CTG margins, given this dynamic? You've added a lot of capacity, and I'm just trying to understand, is this the sort of level of volume to get you into the 3.5% to 5% target margin next year, or does that seem more like a realistic target for fiscal '20? Thanks.

Yes, so I don't want to comment specifically on customers' volumes, so the fact that they choose to make comments around some [indiscernible] to them. But, I think we're going to choose to pass on making any specific volume targets for a particular customer. We will see this volume continue to grow. You know, we think about this volume kind of growing like a freight train. What we're doing with Nike is something unique and different. It's not just automating manufacturing processes, but we're actually kind of reinventing, and rethinking about how to get the supply chain velocity necessary that they need to compete in their marketplace with the speed that they talked about in their analyst day. So, as we move to a regional model, we're going to have a lot more supply-and-demand process changes that we're going to have to do together, things like the new NikeID that they mentioned requires whole new processes about how they take orders, use the web, then releasing it to manufacturing, and a lot of design processes need to shift. So, all this is going to take some time, and it's going to build. And as we think about margins, as kind of that freight train built over time, and this reinvention occurs, we're going to see -- you know, we would expect to, as you know, see the margins move to a break-even at the end of the year and then we would expect those margins to climb across FY '19, and then we expect to hit our targets more along into FY '20. So, I think the numbers they outline, it really depends on how we end up constructing our system together as to what those volumes are going to be. But, we think we're on track to hit those kind of margin expansions, and like Chris just said in the last response to Adam's question, it's a key driver for our margin expansion as we go into FY '19, and then head all the way into FY '20. We do kind of view this as a journey, as we go all the way into -- for many, many years, and Nike even mentioned 2023 as a number. So, it is -- yes, think about it as a freight train, it'll grow, the margins will expand over that entire time frame, and we'll hope to add meaningful value to our customers.

The next question is from Amit Daryanani from RBC Capital Markets.

Hi, thanks, this is Irvin Liu calling in for Amit. I also had a question about Nike. Their analyst day yesterday, they mentioned it a few times that they are co-investing with Flex. Can you talk about where they are co-investing with you guys, and whether or not this is around manufacturing sites? Or, are these more like PP&E type investments? Just any color here would be great.

Yes, you know, the co-investing is a really big relationship. We not only work with them in their labs in Portland but all the way through into custom designing this factory in Mexico. We've got PP&E, we've got process technologies. I think there's like -- it's almost too numerous to really go through the details, I think the important part is, both companies are very committed to working towards the process of reinventing how this happens. Nike's ability to get to their market quicker, faster, with more delivery precision, is key, and like I said a moment ago, it's not just the objective to automate a manufacturing process. It's actually to reinvent how the entire go-to-market system runs. So, the co-investment occurs everywhere from the process technologies that we need to do to enable our regional manufacturing, to create real value and get to market faster, all the way through to some of the process technology, some of the automation technologies. It's really pretty broad. And you know, in stuff like that, those investments and that collaboration and co-invention is taking place up in Portland, and sometimes taking place down in Mexico. So, it's a pretty broad relationship and it's hard to single out any particular piece of that.

And moving over to the CEC side, how should we think about the CEC revenue trajectory going forward, and your sort of segment margins? And how you guys get to the sort of midpoint of your target range? What sort of revenue run rate do you think we need to get to, to get to that sort of target range?

Yes, CEC, we've put out a target range of about zero to minus 5% over the last couple years, just due to the traditional businesses continuing to be challenged. We have a particularly strong footprint into many different companies, but there's really a secular trend towards more and more acclimatized hardware, and more and more -- and revenue becomes more and more challenging. Alternatively, we're investing pretty heavily in the whole aspect of cloud data center, and really more customized data center products. And all that's been growing double digits, and it's been growing double digits for the last few years. We expect it to continue to grow double digits, strong double digits actually, into the next few years. So, as that mix shift happens, we'll respect the margin targets to get more to the middle of the range. So, we're making very strong progress on reinventing -- or not reinventing, but actually redistributing the CEC workload into a more balanced activity, leveraging more and more those Sketch-to-Scale kind of solutions. But I think in terms of expectations and what you'll see, you should expect probably zero to minus 5%, and we do expect to stay more towards the middle of the range there. So, the other thing is, I want to emphasize on that whole CEC business, that as the world moves to a very, very connected world, everything from smart cities to connected living to autonomous vehicles, the value of the data center and moving data around, particularly as you move into 5G, is huge. So, a lot of our autonomous wins are actually on the back of the technologies we have from the CEC group. So, don't think about CEC as just pure CEC anymore. CEC is also an enabler as we move into this smart, connected world.

And then maybe to clarify, just this year, we obviously saw more pressure on the top line as the business is going through some really structural challenges. So, we're anticipating being slightly below that zero to 5% revenue growth, negative growth rate in fiscal '18.

The next question is from Steven Fox from Cross Research.

I was wondering if you could talk a little bit more about the momentum you're seeing, first off, in HRS? You're looking for it looks like a second quarter in a row of maintaining scale to your growth. How much is related to auto versus medical, and maybe you could describe some of the programs that you're [indiscernible], and I had a follow-up.

Yes, so you know, the key thing -- both automotive and medical are growing. Automotive is growing a little bit faster than medical, just because it's just a -- you know, the categories that we're operating with within automotive such as connectivity and kind of some of the future technology that I mentioned, some of the CEC technologies that are now going into the autonomous vehicle, as these new technologies go in the growth rate we would expect, in automotive, to be continuously higher than medical, quite frankly. We actually have a little bit higher [indiscernible] trade in automotive relative to medical. The type of programs are all built around all the future technologies that we've been highlighting in the past, so we typically aren't investing in the older technologies. We're typically investing in the newer technologies, allowing a faster growth rate. And the momentum, it's pretty broad-based. We talked about being in 450 models over the years. Our penetration into each of those models is up to like almost $120 all together. And all this is creating a very, very broad base set of penetration into many different vehicles and in many different categories, but the categories of the future. So, I don't think it's just one thing, and it's really a broad cross section of operation. What's really good about that is, we have a very good visibility into the future. We have -- you go into automotive and medical, you get very predictable life cycles, so we have very good visibility in the future and it delivers a very predictable outcome as you've consistently seen over the last few years. And you know, we're just leveraging off of the content-rich and the deep expertise of the team to go make that happen. So, pretty pleased with that, broad-based. We're right in the sweet spot of all the technology shifts that are occurring in those [indiscernible] places. So, we would expect that penetration to continue.

Great, that's very helpful, and then just one quick follow-up. So, is it possible to just sort of decompose the cloud and converged infrastructure growth that you saw in the quarter, give us a sense for how big it is and how fast we can expect it to grow, say over the next few quarters? Thanks so much.

Yes, so think about this as being only probably roughly 20% of our total portfolio, maybe 15% to 20% of our total portfolio, and it's growing well into the 10%, 20%, maybe even 25% kind of range. So, this is the kind of heart of the portfolio that we're trying to move with our Sketch-to-Scale capability into a better growth rate, and use that to offset any kind of legacy business. Again, some of that offset of the legacy business may change once we move into a 5G area over the next couple years, so we also have 5G to look forward to. And then like I mentioned, the application of CEC into all these other product segments, like into digital health or autonomous vehicle, are key for us using the CEC technology and capability to expand the business not only within that group, but within other groups.

The next question is from Jim Suva from Citi.

This is Tim Yong calling on behalf of Jim Suva. On segment margins, can you give us a timeline, a rough timeline, for those segments to back to the normal guidance range, and what's the headwinds right now for those segments, and how should we think about the margins going forward?

One of the things I would probably just highlight is, if you look to the midpoint of our guidance for our December quarter, that actually brings all four businesses back inside of their target margin ranges, and we'd anticipate that sustaining itself going forward. And as I addressed at the front end, and the first question, there's multiple levers that -- some distinct levers for meaningful margin and operating dollar expansion as we move forward. And you know, this year was an investment year, and we're actually pretty pleased in sustaining a three handle while we're making these meaningful investments, and consciously investing into the future and building out Sketch-to-Scale infrastructure, and capabilities as well as expanding into some new industries and new markets. So, we end up getting back into those target margin ranges in Q3, and moving that forward.

Hey Chris, it's Jim Suva with a quick follow-up. Is there something unique about these ramps? Are they just super heavy investments? Or I would think that normally, you're kind of always ramping things into the top of the bucket, as old programs kind of come out of the bottom of the end of the bucket?

Yes, the uniqueness, Jim, is that these are significantly higher ramps, especially if you look within the IEI portfolio. We always are ramping programs. I mean, our HRS business has well over 50, 75 ramps going on this year, and you're not hearing that. What you have is material, and big, more meaningful programs that are ramping, and as I highlighted in my prepared remarks, it creates us to have to pre-position people, assets and capacity sufficient enough to drive the scale of those into those ramps. So, you saw it reflect itself in the margin pressure both especially at IEI and more broadly for Flex for the period, and it just starts moving forward as we actually get into those ramps meaningfully, in our December beyond, which is reflective. I mean, the midpoint of our guidance for IEI has it 25% up year-over-year, so those are the uniqueness in what we're kind of seeing and operating right now.

The next question is from Paul Coster from JPMorgan.

Yes, thanks. I'll build on that question, if you don't mind. Is there some commonality amongst these IEI ramps that they all share some economy of scale, or are they all just large enough in their own right to drive the margins north? And then, you also talked about larger -- I'll come back to that in my second question after you've answered the first.

Certainly, Paul. No, each of these are individually different, and distinct, and significantly meaningful in their own regard. If you look at IEI, it's on a steady accelerating growth and even more importantly it's been on a steady improving margin. You look back to fiscal '15, 3%, steps up to 3.4%, last year 3.6%, and as they get back inside that range and for the year you're going to see us again growing margin. So, we're well-positioned. We're winning meaningful Sketch-to-Scale business. A lot of that was discussed at length by Doug at our investor day, as it was very broad, very diversified. We're playing in many different markets, got great diversification. And so, these ramps are individually distinct. We're winning a really nice share, it's creating a nice revenue growth backdrop that should provide for some healthy contribution to earnings, especially when we just start sustaining inside that range while that revenue grows.

You also talked about the levers that can be used to increase margins over time. I've seen a lot of innovation in industrial automation at the moment, IoT, robotics, machine vision and so on, and I imagine that you're leading the adoption of much of that. That said, you must have a whole bunch of products being produced in prior generation infrastructure. Is there an opportunity here to kind of go back to your customers, and have them re-up on a new generation of technology that will be margin-accretive over time?

Well, a lot of what we're doing, Paul, particularly in the industrial group, is it is a group that in general is moving to full digitization. And as they move to full digitization, they need a lot more smart connected modules, and very often the product has interconnectivity with other kind of product categories. So, that's a trend that we're very, very familiar with. In fact, it's a core part of our Sketch-to-Scale investments, and it is something that has a great application with the -- firstly in the industrial guys where they haven't invested in those kind of technologies in the past. So, that's how I think about it is they move into the next generation of the products, they have to be smart, they have to be connected, they have to capture data, they have to process the data. Very often they're actually even being predictive at the edge, where the device actually is located. And all of those technologies are the core part of the Flex offering, if we think about the whole Sketch-to-Scale offering. So, as we build -- you know, we've got [indiscernible] technology building blocks around it. So, this is a core part, this is an enabler, and I think that's one of the reasons you're seeing such strong growth in IEI in particular, is the opportunity for applying our competencies is extremely high.

And building off of that, at our investor day we actually tried to break down and isolate and highlight the elevated level of investments we've been making, which is around innovation and expanding design engineering across the categories. As we sit and we identify these technology building blocks that are necessary across each of the industries, whether it's the human machine, interfacing, sensor integration, power management and so forth, we've done three [indiscernible] level just in the last three years of investment to support that. This year is again, a year of investment. We're pre-positioning technology, resources and capabilities here to support those future IoT-enabled products, and help our customers in all these industries innovate and drive forward.

Okay, and it has a direct impact on margins looking forward as well?

Exactly, that is an impact -- it depresses us a bit because you're not seeing the same pull-through, but it has that lag effect where you start seeing the leverage going through with greater Sketch-to-Scale penetration. It means more meaningful design and engineering in technology content in our offering, which means greater operating profit dollars and margin to the business.

The next question is from Mark Delaney from Goldman Sachs.

Hi, this is Timothy Sweetnam on for Mark Delaney. Two questions for me. First, you talked about some new programs ramping in HRS and IEI which weighed on margins this quarter. Can you talk about the sustainability of these programs, and whether these new programs are contributing to the company's goal of increasing average product life cycle across its portfolio? And second, given the fact that the company is ramping several new programs at this point and has talked about this being an investment year, how does that impact the company's willingness to engage in M&A, and what does the M&A pipeline look like today? Thank you.

Let me just start with the first one, Tim. To be clear, these large meaningful programs that are ramping, are reflective inside of IEI. They have more of the impact in terms of the margin pressure. HRS in its own regard has been ramping multiple, multiple products and programs and new customers over a period of time, and has clearly been able to sustain itself inside its margin range. Those underlying programs that we're ramping, clearly and certainly enable a much more predictable, longer product life cycle, and greater margin content. So, that ties perfectly in to our portfolio evolution vision as well as a Sketch-to-Scale. These programs have been won on the back of Sketch-to-Scale, so we're excited to have these programs starting to reflect themselves and manifest themselves inside the growth and inside the margin profile, as it continues. And, we clearly have -- we're excited to be investing into high returning programs such as that. And you know, a good way to think about, does it change our M&A appetite or investment profile -- you know, if you actually think about the company and what it's been doing over the last 3-1/2 plus years, it's been really about a thoughtful capital allocation. If you look, whether it was the level of M&A that we've invested into or the elevated level of CapEx we've been investing into, all of which has still been able to go through while still supporting our continued commitment to shareholder repurchase. So, we have an underlying premise that we're driving, that it creates shareholder value, the long-term commitment, and you're seeing us target capital allocation to support that in a very blended fashion. And you've seen us specifically on M&A be very focused around supporting the growth parts of our business, whether it's energy, whether it's automotive and medical, and it's where we're capturing underlying technologies and expanding that portfolio. So, we're always looking for technologies and markets within the M&A framework. It'll probably be at the same size in contribution as you've seen over the last several years.

The last question is from Sean Hannan from Needham and Company.

Just wanted to follow up on some questions actually a little bit earlier in the call, [Technical Difficulty] CEC. So, at the analyst day, this is a business where you folks had started to discuss a little bit in terms of your product strategy, that ultimately should be able to bring back some growth longer-term down the road. So, just trying to get a sense of first, do you have any update on what point the declines that are year-on-year start to actually stabilize, so we can get a little bit more color or insight on that at present time? And then, part two, how sizeable is -- how is that sizeable optical business doing, either in the quarter looking forward and contributing to then that larger picture? Thanks.

So, let me handle the second part of that question first, to get a little more clarification on the first one. So, optical is a key part. We've got a number of different optical programs with multiple customers, and have an absolute, state-of-the-art optical lab in Europe that's really first class. It's a business that actually grows for us, but you know, it's probably not going to be something that moves our needle in a massive way. I mean, it's just part of the CEC portfolio that we view as being attractive, and something that has a positive influence on it. So, I don't think that's going to -- you know, while we're positive, and we think we have industry-leading capabilities in it, it's not going to be significant enough to move our needle too much. The thing we're looking for in telecom that's really going to move our needle is 5G, and we believe we're very well-positioned for 5G, even in terms of some of the early engagements that we have with some of the more meaningful vendors in that place. So, that's kind of the bigger thing that's actually going to be a place where we can move our needle a little bit more, and looking forward to that.

So Sean, if you go back to our investor day, what Caroline was doing was really defining better for you how we've retooled our team with richer experience. We continue to invest and build out a really good, strong data center and converged infrastructure competency. As we look forward, we have some real, true technical know-how, we have some real powerful relationships, we're a founding member of the Open 19 Initiative. And so, you start putting together the pieces that we've been investing and structuring, and you think about 5G, the telco cloud, and the cloud data center. It starts creating an encouraging, longer-term potential for us. But clearly, the business today, that industry has been structurally challenged. So, I think that you just need to see that the company continues to be thoughtful about where it invests, how it positions itself, and has a real good future, long-term potential.

Mike, do you want to wrap up the call?

Yes, Kevin, thanks. Yes, the quick wrap-up, I want to first just thank everybody for being here today. I know it's a pretty busy day from an earnings standpoint, so we appreciate you guys being on the call. Just to summarize, I had three points that would just be worth elaborating on. The first is growth. We're on track to return Flex to growth this year, and our year-over-year quarterly revenue growth is continuing to see acceleration on a quarter-by-quarter basis. So, we're pretty excited about that, and all on the back of all the investments as I said we've been making over the last few years. The second is evolution. Our portfolio evolution continues to gain more momentum. This will drive margin expansion, it's going to drive greater visibility, it's going to have a higher predictability and it's going to have less seasonality. These are all going to be characteristics of how we're moving the portfolio across segments, and also within segments. And the last thing, the third thing, is value creation. We continue to have great consistent cash flow generation, it remains intact, it allows us to strategically invest in our platform, develop new and important relationships and capabilities that expand markets, while all at the same time we're returning value to our shareholders. So, we continue to move along a very thoughtful path, and we're executing well along that path. I think [indiscernible] going to be very pleased over the next few years.

So, that brings us back to the top of the hour. Again, I want to thank everyone for being on the call, looking forward to seeing many of you at our upcoming conferences and meetings in November and December. This concludes our call.

This concludes today's conference call. You may now disconnect.