Good day, ladies and gentlemen, and welcome to the lululemon athletica Second Quarter 2014 Results Conference Call. [Operator Instructions] As a reminder, today's conference call is being recorded. I would now like to turn the conference over to Chris Tham, Senior Vice President of Finance. Sir, you may begin.

Good morning, everybody, and thank you for joining us on our second quarter 2014 conference call. A copy of today's press release is available on the Investors section of lululemon's website at www.lululemon.com or furnished on Form of 8-K with the SEC and available on the Commission's website at sec.gov. Shortly after we end this morning, a recording of today's call will be available as a replay for 30 days on the Investors section of the website. Hosting our call today is Laurent Potdevin, the company's CEO; John Currie, the company's CFO; and Tara Poseley, our Chief Product Officer, will also be available during the Q&A portion of the call. We would like to remind everybody that statements contained on this call, which are not historical facts, may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results might differ materially from those projected in such statements due to a number of risks and uncertainties, all of which are described in the company's filings with the SEC. For today's call, we have a limit of 1 hour. [Operator Instructions] And with that, I'll turn it over to Laurent.

Good morning, everyone. The results we're sharing with you today are beginning to reflect the ongoing work that is being done across our entire organization, and our sales and bottom line for the quarter finished slightly ahead of plan. We are early in the process of getting back to consistently delivering amazing and innovative products to our guests, along with unmatched guest experiences. We obviously don't aspire to flat same-store sales and earnings that are down year-over-year and yet are confident that the work and investments we're making is building the foundation that will fully unlock lululemon's long-term global potential. On our last call, I laid out 4 key priorities, product, brand, guest experience and international expansion, and our second quarter results indicate consistent progress against those priorities. On the product front, product flows were a dictating force in our sales trend in the second quarter. This was particularly evident in July as we chased into additional prints and bottoms and leveraged our Fast Turn team to create mesh products, which brought newness and excitement in-stores and online. Additionally, our transitional collection, which was a new strategy to bridge summer and fall, was incredibly well received by our guests and created the upside we saw in July by selling through faster than anticipated. While our assortment are not optimal this year, we have started to shift our mix with further improvement expected in 2015. We've also emphasized our commitment to building our foundation over the next 18 months in order to set ourselves up for global growth. One of these foundational areas to strengthen is our go-to-market process. And although it's still early, we are hitting each milestone in the implementation of the calendar that we set to achieve. At this time, we've completed the cadence of the calendar, resulting…

Thank you, Laurent. I'll begin by reviewing the details of our second quarter of 2014 and then I'll update you on our outlook for the third quarter and the full year of fiscal 2014. For Q2, total net revenue rose 13.4% to $390.7 million from $344.5 million in the second quarter of 2013. The increase in revenue was driven by total comparable store sales on a combined basis, including e-Commerce at 0%, comprised of 30% growth online and a bricks-and-mortar stores sales decline of 5%, all on a constant dollar basis; the addition of 44 net new corporate-owned stores since Q2 of 2013, 29 net new stores in the United States, 1 store in Canada, 1 in Australia, 3 stores in New Zealand, 1 in the U.K. and 9 ivivva stores; and offset with a foreign exchange impact of a weaker Canadian and Australian dollar, which had the effect of decreasing reported revenues by $5.1 million or 1.3%. We were able to deliver above our Q2 expectations coming into the quarter due to strong performance of fall transition products that we were able to pull forward from Q3 and drive sales in July. During the quarter, we opened 7 net new corporate-owned stores, 5 in the U.S., 2 ivivva and 1 in Australia and New Zealand, offset with 1 closure in Australia. We ended the quarter with 270 total stores versus 266 a year ago. There are now 206 stores in our comp base: 39 of those in Canada, 136 in the United States, 23 in Australia and New Zealand and 8 ivivva. At the end of Q2, we also have a total of 93 showrooms in operation, 42 lululemon in North America, 18 internationally and 33 ivivva. Corporate-owned stores represented 75.3% of total revenue, or $294 million, versus 79.5%…

[Operator Instructions] Our first question is from Adrienne Tennant of Janney Capital Markets.

Laurent, can you talk about what percentage of the July flows and go-forward are in the seasonal versus the core category. And then John, if you can you talk about the inventory. You had to pull some of it forward because demand was good. So where does that put you in terms of inventory flows going into the early part of fall season. So if you can talk a little bit about that. And then really quickly, the Canadian comp versus U.S., if you can talk to that.

I mean, as far as the breakdown, I mean, we had this strategy of launching the transitional line that was a bridge between summer and fall that was received really well and the sell-through was higher than anticipated. And so we had a plan of selling 3 weeks of those in July, as well as the first 2 weeks of August and we pretty much moved all of that product in July. So that probably created a void in the first 2 weeks of August. What is the breakdown exactly?

So I have mentioned -- the question also is about the balance of season versus core so -- and as we have talked about in the last call, in Q1, the balance as we move into the back half of the year is going to be about 40% in core, which is similar to what it trended in 2012. John, did you want to...

Yes. On your question on pulling inventory from Q3 into July. Moving the transition line up into July helped July sales relative to what we'd expected when we gave guidance. That did leave us a little bit lighter in that product for August, but still had some remaining that has helped us through August, but a little bit lighter than what we'd expected. So when you look at our revenue guidance from last quarter for the full year, it's really just been a shift from Q3 into Q2. And your other question on comps. On a combined basis, U.S. was up slightly low single digits and Canada was down mid-single digits.

Our next question is from Ed Yruma of KeyBanc Capital Markets.

This is Jessica Schmidt on for Ed. Laurent, you've been in the position for a while now. So where do you think you still need to invest to get systems and processes to where you really want them to be? And do you think you have the necessary tools to manage the business?

Well, I really do feel that we've got the necessary tool. I mean, as I mentioned on the call and actually on the prior call, I mean, we are on this journey of building the foundation and I'm really excited to see the team hitting all of the milestones so far. I mean, it's a really deep project that will see all of its results pay off by the first quarter of 2016. But one of the first milestones being to free up a lot of our designers' time and giving them a lot more room to create has been achieved and we've rebalanced the whole calendar. So that first milestone is incredibly critical in our process of really building the most technical, innovative products. So we have the investments. We're still building the team that we've made a lot of progress in getting a lot of amazing talent onboard. And so I'm really excited. It's by no mean a finished project and there is still much work to be done, but we're very much on track, both from a human capital standpoint, from a financial standpoint and from a technology and process standpoint.

Our next question is from Brian Tunick of JPMorgan.

I guess, 2 questions. I'm sorry if we missed any comments you made about the second quarter comp drivers, whether it was traffic or conversion. You're -- we're curious, in terms of traffic, if there's any sense of loyalists versus new customers, what you're seeing there. And then on the SG&A, John, just some more color on this timing shift. Can you give us some idea of how much spending is shifting into the second half? And it looked a little like you may have reduced your fourth quarter implied earnings guidance. So we're just wondering was it comp or anything else in Q4 that might be taking a more conservative view.

Okay. On your first question, I mean, for the past couple of quarters, traffic has been down and that's what's negatively impacted our comp. But in Q2, actually traffic turned slightly positive so that's encouraging. But the comp was adversely impacted by lower conversion and average basket, which is consistent with the fact that our product assortment wasn't ideal, but again encouraging in terms of trends. In terms of the shift in SG&A, it's really referring to some of the paid search and other traffic-driving initiatives that we'd planned for the 3 quarters when we gave guidance last quarter. With sales trending a little bit higher at the back half of Q2, we didn't spend as much of that as we'd originally anticipated. It's a shift of maybe $2 million to $3 million from Q2 forward. And then your last question regarding Q4, of course, I haven't broken out Q4 in the past, so really the guidance I'm giving today doesn't indicate a drop in Q4. It's consistent with what we've included in my guidance when I gave it last quarter.

Our next question is from Oliver Chen of Citigroup.

I had a bigger picture question for Tara and Laurent. What are your longer-term ideas in terms of how we prioritize like the factors that will keep you ahead of the competition with respect to product? And then a financial question is on the gross margin side. Is our expectation for merchandise margins to continue to show that positive traction and product mix to continue to be a headwind?

I mean, before I let Tara maybe getting more into the product, I mean really the bigger strategic moves are really in ramping up everything we do with our Whitespace workshop and combining that with our ambassadors. I mean, as I've said since day 1, I mean, our ambassadors are truly our most underleveraged asset. I mean, they are the voice -- the authentic voice of this brand and we've done a lot of work in having the Whitespace and the ambassadors collaborate in looking at new activities, looking at problems they want to solve during the activities and we have a lot in the pipeline, both from a performance standpoint, from a raw material standpoint and from a category standpoint and we'll be sharing that when we're ready. And obviously, not to forget all the work that we're doing to boost our international expansion that we're getting really strong demand internationally and we started to really accelerate the pace of our rollout with the Singapore store opening, the finalization soon of the Hong Kong location and the second location in London.

So I think Laurent stated it well. I've been going through with the team over the last 6 months a rigorous process of building a 3- to 5-year product raw material strategies and innovation strategies. So obviously, as Laurent stated, we're not going to share those because it's proprietary, but that work is in motion and the teams are executing against that really tight project plan. Again, all of those areas are in place so we look forward to sharing those as we go into the future.

Our next question is from Camilo Lyon of Canaccord Genuity.

I was hoping you could give us some color on the new DC opening, how that is expected -- or if that's expected to help product flows this year? Or is that a 2015 benefit? And then just if you could update us on the 2 new mills that you've added this year, their contribution to improving product flows.

I mean, on the DC, I mean, the facility we just opened is in Columbus, Ohio and the biggest improvement right now is the service level to our guests, right? I mean, with the opening of that facility with no additional costs, I mean, we're reaching over 85% of our guests in 2 days. So as we head into Q3 and Q4, we're really excited to see that level of service improve. And then starting in January, we will be delivering to the stores from the facility. And what was the second part of the question?

Something about mills.

Our next question is from Lorraine Hutchinson of Bank of America.

John, as we think about the gross margin trajectory going forward, is your expectation that you'll be able to get back into the mid-50s? Or is the focus on fashion and seasonal product going to keep the margin down in the low 50s going forward?

As we've said, I mean, in the near term, you're likely to see gross margin in a similar range to what you've seen in Q2. The work underway that Tara's team and Jennifer's team are doing on the go-to-market calendar over the next couple of years, we see significant improvement in gross margin coming from those initiatives. I think I've said in the past, maybe 300-or-more basis points. And then in terms of pricing architecture, we're really not at a point of talking about whether there will be significant changes that would impact product margins. So for the time being, I assume that, that would not be a factor. But I mean, bottom, bottom line, just with the improvements on the process side, we see getting back closer to that mid-50s level.

And what's the time frame on that?

Well, not until we get into 2016 and these initiatives have really taken hold and have impacted the seasons that we'll be delivering in 2016.

Our next question is from Kimberly Greenberger of Morgan Stanley.

I just had a follow-up question on Lorraine's gross margin question. Obviously, understanding you don't want to reveal any trade secrets about the work you're doing on the supply chain, we're just trying to understand the move from the low 50s to the mid-50s in gross margin. Is that being driven by an ability to take price in the assortment? Are you looking at trying to save on average unit cost? Maybe if you can just help us understand what the levers are that could get you there.

Yes, it's really not based on taking pricing. That's always the last lever that we want to be pulling. It's primarily based on efficiencies, I mean the obvious ones being reduction in airfreight and some of the other costs, efficiencies coming from the new DC, but also just a much smoother and more efficient process from design all the way through to delivering to the stores.

Our next question is from Omar Saad of ISI Group.

Two questions. First one is on the success you're seeing in the transitional merchandising assortment. What's really going on there? What are you learning? What's so good about the assortment that's really driving that business? And how can you kind of carry forward that momentum or even build upon it going forward? Any insight, especially around product and stylings that's driving that? And the second question I have is on ivivva. You mentioned a really good number there -- comp number there. I know it's really small, but maybe you could talk about the long-term vision for that concept and brand and how it's going to fit versus the lululemon brand and complement it and where you see that going long term?

So I'll answer the success of the transition line. I think it really underscores what I had been talking about over the last 2 quarters about our opportunity to be really consistent in bringing the beauty and the technical back to our products and I think that line, definitely illustrating that. I also think the work that the team did with print and also some of the print that we chased into in the quarter also we saw great response there. So again it's just that newness and beauty, that's always underscored by a great technical product. I mean, did you want to talk about ivivva?

Yes, I mean, with ivivva and especially having a 12-year-old daughter, I mean, I'm very, very excited about the work that we're doing with ivivva. I mean, there's so much correlation with what we're doing at lululemon. And when you see the Dreams & Goals programs that we rolled out for little girls, I mean, it's been incredibly well embraced by our young guests. And with sales getting into -- close to $1,000 per square foot, I mean, we're very happy with the result. And we're creating the next generation of lululemon guests, so a very exciting prospect. And in the meantime, we're doing great work with our -- in our communities with little girls. So yes, we see a bright future with ivivva.

Our next question is from Bob Drbul of Nomura Securities.

John, I was wondering if you could give us some commentary around new store productivity trends, U.S., Canada, men's productivity, ivivva productivity.

Okay. Just making sure I don't miss any part of the question. New store productivity, again, in Q2, new store productivity was coming in around $1,100 to $1,200 a square foot, that's similar to where we've been coming in for the last year or more. In terms of men's, we don't really break up productivity by men's. I mean, in terms of comp, I mean, men's comp up 5%. But again, I don't have that productivity broken out. And as Laurent mentioned, ivivva, it's on track to end the year at somewhere a little over $1,000 per square foot of productivity.

Got it, okay. And I'm not sure if I missed it, but did you guys give a full year e-Comm sales estimate that's included in the guidance today?

We didn't break out whole year e-Commerce estimate, e-Commerce is -- in Q2, it was running about 16%. Typically, it goes up a little bit in the fourth quarter, but we haven't specified an e-Commerce number for the year.

Our next question is from Betty Chen of Mizuho Securities.

I was just wondering, John, if you can talk a little bit more to the SG&A deleverage. Should we expect the magnitude to be similar to what we saw in the first half? Or given the shift in timing, should it be a little bit greater? And whether we should expect that growth rate to continue in 2015? And then my second question is related to earlier. What were the women's comp during the second quarter? And how did that measure against Q1, if we saw any sequential improvement?

Okay. SG&A, the guidance I've given, say, for Q3, I you see a margin profile pretty similar to Q2. The thing to watch for as you look at our second half, and I mentioned Q2 was skewed a little bit by sort of nonrecurring sort of foreign exchange gains last year versus losses this year and that simply comes from the balance sheet date revaluing the U.S. dollars held in the Canadian company, so it's really not an indication of the health of the business. But if you look at last year, the Canadian dollar dropped significantly. So for the full year last year, as I said in my prepared remarks, the foreign exchange gain that was offsetting our SG&A was about $17 million and most of that was in the back half. So we wouldn't expect to have that benefit again this year. Also last year, because we missed our budget and plans, our bonus accruals were reduced, primarily in the back half, and that was sort of a high single-digit millions benefit to SG&A this year that we won't enjoy that -- sorry, last year that we won't enjoy this year. Seems strange to say enjoy a lack of a bonus, but anyway. Women's comp, I said men's was plus 5%. I believe women's was just slightly negative.

Our next question is from Lindsay Drucker Mann of Goldman Sachs.

I wanted to ask another gross margin question. In the last couple of quarters, we've seen some pretty nice sequential improvement in the rate of decline in your product margins. You called out last quarter 110 basis points of discounts that hurt and you didn't call it out this quarter. And then also some of the negative mix impact got better. I was actually curious, how do we think about what's embedded in your gross margin guidance for the back half of the year? Could you actually get a bit of a tailwind from discounts that you put into place in the fourth quarter? Or are we looking at the 2Q kind of run rate kind of product margin compression being pretty similar?

Yes. Looking at the back half, I mean, your question on discounts, we -- I don't think I called that out, but I mean markdowns and discounts were a little bit lighter in Q2 this year than last year. The back half, there might be a little bit of a tailwind because we had an online warehouse sale last year. We may not duplicate that this year. But other than that, I mean, the items in our gross margin guidance, I mean, there continues to be some tailwind from product mix; FX, again the Canadian dollar continuing lower will impact at sort of 30 to 50 basis points; and with lower year-over-year revenue, there's deleverage on our fixed costs, so occupancy and depreciation and the cost of the product teams. So those continue to be the main pieces of the gross margin guidance.

Our next question is from Tom Filandro of Susquehanna Financial Group.

I had a question on the DTC channel. I was hoping you can give us a sense of like what's driving the acceleration? Is it transaction, the average dollar growth, anticipation of what we should see for the balance of the year? And can you also address what the contraction was in that channel? I think it was down 220 or so for the period. And then Laurent, just very quickly, I think you mentioned this earlier about the omni-channel initiative in-store driving some perform there. Can you expand on exactly what it is you guys are doing in-store to offer that customer the full assortment?

Yes, we've rolled out -- it was a pilot earlier this year, maybe even at the end of last year actually and we rolled out to all stores now the bag backroom app. So it's an iPod device that's rolled out in all of our stores that give access to the entire online inventory for our educators to see to service our guests. So when you're in-store, you not only obviously have access to the in-store inventory, but now you have access to the whole online inventory and we've seen great momentum in growing this business last quarter to about 1% of our retail sales. So much better service for our guests and much better use of our online inventory. And we've also rolled out a new guest order management system that allows us to flow the orders better through the different DCs. So that was the bag backroom app and obviously we set up a full group in-house to really look at the guest experience. And as we build further technology, I mean, we're obviously going to enhance -- we're going to continue to play with technology and enhance the service that we're providing in maximizing the inventory between the channels.

On your question on your DTC, as I said in the prepared remarks, e-Commerce comped up 30%. That was driven pretty much entirely by increased traffic. So strong traffic growth continues, not much of a change in terms of conversion or average order value. Your other question, I think, you said down 220 basis points, you might be looking at the margin -- the DTC margin that's contained in the Q. But if that's what you're getting at, it's really just a flow-through of the lower gross margin. Most of the costs related to DTC are variable other than the product margin.

Our next question is from Faye Landes of Cowen and Company.

I'm just hoping that you can elaborate a little bit more on inventory. The -- pretty consistently, the products that sell really well sell out ahead -- earlier than you've expected, which is, in some ways, a high-class problem, obviously, but you're also leaving money on the table. I don't remember the last quarter where that didn't happen. So can you talk about how you plan to adjust things so you can fully capitalize on the opportunities that you have?

Okay, I'll take that one. Yes, so what we talked about in Q1 where we've seen the high sell-through in the seasonal goods and we had over planned our expectations for it. So what we did for Q3, obviously we weren't able to affect Q2, what we did for Q3 was really shift that core investment open-to-buy into the seasonal product. We went back and looked at sell-throughs on all of our seasonal products in Q1, made sure we are planning our APS appropriately in Q3 and really get that diligence in making sure we were investing appropriately. But we will -- I mean, we also do really value the scarcity model. We've done very well markdown rate in the brand, which I love. So it's always that fine balance and that's what we are working and perfecting towards. And then as part of what we had talked about, I think we had mentioned this earlier, we're in the process of implementing a new planning and allocation tool that will be fully live for the planning of winter 2015 and we're on time and on budget with the execution and implementation of that tool.

Our next question is from Howard Tubin of RBC Capital Markets.

Can you just update us on where you stand on like senior level hires and what senior level open positions are still there?

Yes, we've got 4 senior level positions open. We're in the final stages of the HR and brand and community search and we're probably about halfway through the process with the CFO search and the Managing Director for Europe search.

Our next question is from Paul Lejuez of Wells Fargo.

Sorry if I missed any comments about the showrooms, but can you maybe talk about how your showrooms are performing? What percent of them are you happy with? And which geographies do you feel most comfortable that the brand is resonating?

Maybe I'll take that. We had probably the most showrooms we've ever had open during the quarter. I think it was 90, 93. 33 of those are ivivva, which is a real expansion of the showroom program for ivivva. The showrooms in North America for lululemon continue to perform as they have and they are our barometer for where a market is ready for a store. I think, more interestingly, the international showrooms, speaking broadly, the ones in Asia are doing extremely well, much better than the counterparts that we had in the U.S. as we expanded into the U.S. So Singapore, Hong Kong, Shanghai, those showrooms are very strong, which is an indication that there had already been brand awareness in Asia. In Europe, with the London store opening well ahead of our expectations and the other showrooms in London are continuing to perform very well again because there's growing brand awareness in London. And the other European showrooms are really doing quite similar to how the U.S. showrooms did when we really expanded that program back in 2009. So they're on track building brand awareness and we're building showroom sales, which is one of the indications of when we are ready to open stores. So I'd say, overall, the European showrooms are on track.

Our next question comes from Dorothy Lakner of Topeka Capital Markets.

Just a question for, I guess, either Laurent or Tara. In terms of the milestones that we should be looking at into the back of the year as to where you are in the calendar and getting to where you want to be from a product standpoint, what should we be looking for as that product comes into the stores in the second half of the year. You were obviously able to chase more in second quarter. What should we be looking for in the third and into holiday?

So for the back half, obviously, the go-to-market calendar and all the work that we're doing with that, we commenced that in Q1 of this year. So obviously that did not affect Q3 and Q4 of this year since that was already bought and commercialized at that time. So really for the back half of the year, it was rebalancing the core versus the seasonal, which I just talked about a few minutes ago and just making sure that we are investing appropriately in the seasonal. We continue to really focus with the design team on making sure we're getting all of that beauty and technical, always technical, back into our products because we are very proud that we are the originator for that in that -- in the space and a lot of focus there. So that's really -- that's the focus for this year and then just using our Fast Turn where we can to continue to chase into products. A good example of that is the Fast Turn team to create a special capsule -- a little capsule product to vibrate before Black Friday. [indiscernible] price selling during that weekend.

Our next question is from Janet Kloppenburg of JJK Research.

Tara, just a question on the product mix. I think you've introduced a lot of new bottoms to try and reinvigorate that core category. I was wondering if you could talk about the performance there and your outlook as we go forward for that category. And Laurent, I think you had defined $10 million in incremental SG&A spending on traffic-driving initiatives for the stores and -- or for the entire business and I'm wondering if that -- there was impact on the SG&A line from that in the second quarter or if most of that will be incurred in the back half or if we potentially could see more investment there.

Yes, Janet, you're right. We had talked about that Q3 was going to be a focus on really reinvigorating our core products starting with the bottom. And early signs are that some of the -- there is some emerging core that is in-store now that we're excited about as we move in -- I'm not going to call out what those involve because that's proprietary information, but we are seeing some good signs there. And then as we move into Q4, the other area that we have -- we're really clear that we needed to continue to evolve and create newness within tops and the tanks and we're also we'll be testing some new emerging core in those areas as well. And then the Fast Turn team will continue to also be testing and learning and getting that insight and information that we can chase into the future quarters.

And then to the second part of your question, I mean, we had allocated $7 million to drive traffic through increased paid search, online campaigns, e-mail segmentation and redesigning our product notification that are so relevant to our guests. And most of that spend will happen in the back half of the year. I mean, in Q2, I think we spent less than $1 million on it and we looked at sell-through and inventory and saved that investment for the second part of the year.

Our next question is from Sam Poser of Sterne Agee.

It's Ben Shamsian for Sam. Wanted to dig in a little bit more on the brick-and-mortar side of the business. Can you provide us with the traffic in the brick-and-mortar stores? And then, if you could, the comps by month in the brick-and-mortar?

Traffic in bricks-and-mortar was up sort of mid-single digits and -- but I don't break up monthly comps. I will say, though, that July ended up a little stronger than our expectations because of, as we talked about, the pull-forward of the transition line.

Our next question is from Dana Telsey of Telsey Advisory Group.

Can you talk a little bit about where do you stand on some of the improvements and -- from the third-party consultants, what you're learning as they look at the organization and the processes? And then just lastly, Tara, what -- on the new line where you've seen the big improvement, on the style, price, how are the learnings able to influence the other products flows in the short term? And is the margin of this product, do you see that developing early in the ability to have improved margin?

Okay. So the third-party consultants that we brought in to help us with re-engineering our go-to market calendar, we've had really good insight. I think, on the whole, it's a lot around how we were sequencing events within the calendar and we're going through a process of resequencing how we bring products to market. Some things were happening too late in the process that need to be moved forward. I'm not get into all that detail, but we've really, really honed in on what those pieces are and are going through the process of a redesign of every single quarter for each season. And we are on track by Q1 of 2016 to have a fully operational go-to-market calendar. And then, I think, -- Dana, what was your second question? It was about style and price and what we can do in the short term? This is a very scrappy and entrepreneurial culture, which I deeply value and we literally are learning minute-by-minute about our assortments as we see that getting in and using our Fast Turn team when we can to react quickly to get those learnings in and then also infusing that into any of the learnings into the future seasons that are in process and being worked on.

Thank you. I would now like to turn the conference back over to Laurent Potdevin for closing remarks.

We'd like to thank you, all, for joining us today. And we look forward to talking to you again in the quarter. Thank you so much.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation, and have a wonderful day.