Ladies and gentlemen, thank you for standing by, and welcome to the TE Connectivity Q3 2017 Earnings Call. At this time, all participants are in a listen-only mode. Later, we'll conduct a question-and-answer session. And as a reminder this conference is being recorded. I would now like to turn the conference over to our host, Sujal Shah, Vice President of Investor Relations. Please go ahead.

Good morning, and thank you for joining our conference call to discuss TE Connectivity's third quarter 2017 results. With me today are Chief Executive Officer, Terrence Curtin; and Chief Financial Officer, Heath Mitts. During the course of this call, we'll be providing certain forward-looking information. We ask you to review the forward-looking cautionary statements included in today's press release. In addition, we'll be using certain non-GAAP measures in our discussion this morning, and we ask you to review the sections of our press release and accompanying slide presentation that address the use of these items. Press release and related tables, along with the slide presentation, can be found on the Investor Relations portion of our website at te.com. Finally, for participants on the Q&A portion of today's call, I would like to remind everyone to limit themselves to one follow-up question to make sure we're able to cover all questions during the allotted time. Before I turn the call over to Terrence, I'm pleased to announce that we'll be hosting an Analyst Day event in New York City on December 13 for the reception of management plan of the evening of December 12. So please hold these dates to attend. Now, let me turn the call over to Terrence for opening comments.

Thanks, Sujal and thank you, everyone, for joining us today. I'm very excited to share our strong results for the third quarter and our increased growth and earnings outlook we're providing for the full year. I believe this quarter's performance continues to demonstrate the strength of our business model with all of our segments contributing. It also reflects the ongoing effective implementation of our strategy to create safer, sustainable, productive and connected solutions for our customers. To briefly recap the key elements of our strategy that we've been driving, number one it's about driving above market growth through our focus on harsh environment applications, where we can accelerate content growth. Secondly, it's about leveraging our TEOA continuous improvement system to expand our margin. And lastly, it's delivery and consistent execution of our balanced capital allocation strategy, which allows us to further strengthen our position in our markets via bolt-on M&A, while also returning capital back to our owners. When you look at our third quarter, we delivered sales of $3.4 billion. This represents 8% organic growth year-over-year with growth across all our segments, as well as regions. We delivered 50 basis points of adjusted operating margin expansion year-over-year and adjusted earnings per share of $1.24, which is up 15% over the prior year. This year's growth in EPS year-over-year was entirely driven by our sales and operating income performance. If you want to look at our $1.24 compared to our guidance of $1.16 approximately half was driven by the higher sales growth of 8% with the remainder driven by taxes and a little bit of currency. As a result of our momentum and what we're seeing in our markets in orders, we are raising the mid-point of our revenue and adjusted earnings per share guidance to $12.9 billion and $4.73…

Thank you, Terrence and good morning, everyone. Please turn to slide 8 where I will provide more details on Q3 financials. Adjusted operating income was $559 million, with an adjusted operating margin of 16.6%, leveraging the strong organic growth of 8%. GAAP operating income was $536 million and included $19 million of restructuring changes and $4 million of acquisition-related charges. For full year, we continue to expect restructuring charges of approximately $150 million driven by footprint consolidation from acquisition and structural improvements. GAAP EPS was $1.21 for the quarter, adjusted EPS was a new record for the quarter at $1.24, up 15% year-on-year driven entirely by sales growth and operating margin improvement. The growth above prior year is a result of strong execution of our strategy with harsh applications driving growth, TEOA driving efficiency and balanced capital deployment enabling acquisitions and share repurchases. Our EPS performance was above our prior range, driven mostly by revenue growth and the benefit from a lower tax rate due to the mix of profitability by jurisdiction. For the fourth quarter, I expect an adjusted effective tax rate of approximately 19% making the full year tax rate approximately 18% similar to last year. However, as discussed last quarter, please keep in mind the year-over-year dynamics. We received an EPS benefit in the first half of fiscal 2017 and have an EPS headwind in the fourth quarter. Going forward, I would expect an adjusted effective tax rate of approximately 19% to 20%. We'll continue to provide details on that. Page 15 of our slide deck contains a bridge that provides these details for the first half and second half. Turning to slide 9, our strong Q3 results demonstrate that we are performing well against our business model and executing upon multiple levers to drive earnings growth…

Thanks, Heath. And let me get into guidance, and I'll start with the fourth quarter. And if you could turn to slide 10, please, I'd appreciate it. For the fourth quarter, we expect fourth quarter revenue at $3.2 billion to $3.3 billion and adjusted earnings per share of $1.14 to $1.16. When you look at this, this represents reported sales growth of 5% and organic sales growth of 4%. And from an operational perspective, this would be adjusted EPS growth of 8% once you normalize with the unusually low tax rate we had last year that Heath just highlighted. Looking at it by segment. For the fourth quarter, we expect Transportation Solutions to grow mid single digits on both a reported and on an organic basis. This is above expected auto production levels of 1% with the outperformance driven by the content growth I mentioned earlier. We also expect growth in commercial transportation across all regions in the fourth quarter, and as noted earlier, we do expect to have some lingering effects on margins from supply chain dynamics in the fourth quarter. But expect margin performance to improve as we put these issues behind us in early 2018. In Industrial Solutions, we expect to grow high single digits on a reported basis and mid-single digits organically, with growth expected across all three of our business units. And we also expect, as I mentioned, operating margins to expand sequentially as well as year-over-year in the fourth quarter. And in Communications, we expect also mid-single-digit growth on both the reported and organic basis with growth in each of our three businesses. And while we're not providing guidance beyond this fiscal year, I would ask that as you look at your models, you keep in mind our typical seasonal trends as you think…

Okay. Thank you. Lisa, could you please give the Q&A instructions?

Thank you. Our first question comes from the line of Wamsi Mohan with Bank of America. Please go ahead.

Yes. Thank you. Good morning. Heath or Terrence, can you address the margins in the Transportation segment? How much of this sort of headwind that you're calling out here in 3Q and 4Q, were due to factory issues versus expedited shipping or other supply chain reasons? And can you quantify the headwind that you saw in the third quarter, and I will follow-up?

Good morning, Wamsi. Thanks for the question. Certainly with these growth rates that we're seeing in Transportation, both from improved market conditions that have continued throughout the year, as well as our ability to well outperform those and the volume that's driven for us has created some inefficiencies in terms of our supply chain keeping up with us in that regard. Most all of it is a type of material constraint, and then the higher cost for expedited freight taking of our customers. So we're working through that. I would say that there's a plan in place to get this remediated, but we do expect to continue to see some of this headwind in our fiscal fourth quarter and into the early part of 2018, albeit as we correct some of those issues, it won't be quite as impactful on the numbers. But I would say that it's worth a couple of hundred basis – it's worth not a couple of hundred basis points, it's worth 20 to 30 basis points if we look at it overall.

Okay. That's helpful. Thank you. And Terrence you've shown some really nice growth here in the Transportation segment despite weak auto production concerns and the backdrop remaining somewhat still challenged from a auto production perspective. So as these results look increasingly decoupled from production trends, can you maybe address what you are doing to drive this content growth in the broader Transportation segment, and can you talk about the visibility that you have in this content growth.

Thank you, Wamsi, for the question. But let me take it because it is something what we think about our Transportation business model, first it always starts with a global picture. And I think one of the things that we're very fortunate about where we drive growth it's just not in one region in the world it's across the world. And even as production has slowed down to 1% and pretty much in line with where we are, it does come back to how do we drive across the three big trends that are happening in the vehicle. And we've continuously shown content growth, and it has been accelerating both from our focus as you think about not only what's happening in the connected car or in safety applications, but also benefiting from everything that happens around the powertrain whether it's on combustion engine that needs to get more fuel efficient towards the adoption of electric vehicles that while we talk electric vehicles and you really think about it, we get very excited around where electric vehicles are going in China. So it is along all three dimensions both with where safety applications go, certainly the emission and the green go and also around the connected. And what we feel very proud of if you went back five years ago, our content per vehicle in a car was around $50. Today, it's well over $60, and we with the programs that we are winning, we see that content momentum continuing to increase. And when you take the results that we have in a 1% production environment, like we've had in quarter three as well as what we expect really in quarter four, growing mid-single-digit shows the content momentum we have. And I just think we continue to demonstrate it and we feel very good about the program ramps will continue to allow us to have that type of separation even as global production stays at a low-single-digit to flat environment that we're in.

Great. Thanks. Thanks for the color.

Thank you, Wamsi.

Thank you, Wamsi. Could we have the next question, please?

That comes from Shawn Harrison, Longbow Research. Please go ahead.

Good morning, everyone. Terrence, wanted to follow up just on the auto content particularly in EVs. Maybe if you could just discuss your content per vehicle in light of the fact that UK now says they are phasing out combustion engines. But from what I can gather, it sounds like you have a high market share in a lot of the connectivity products that go into EVs, but maybe discuss the content per vehicle and how that's been growing over time?

Yeah. So let me talk about EV. And I always do think, Shawn, it's important to make sure when you talk EV about – close to 90 million cars are made in the world, and today, there's about 4 million that are electric vehicles whether it's pure electric or plug-in hybrid, et cetera. So, what's really – what we like about that is you do have your emission regulation to drive that increase, but when you sit there, we see the opportunity to that type of level to quadruple of the amount of electric type vehicles over the next five years. And when you see that, clearly, that creates higher demand for power and voltage connections that also gets into things we do from our very high-current relay-type products, as well as you get into sensing that occurs there. And when you sit there, that really comes down to the energy management that gets into the harsh environment. So the whole environment that you have there really plays to our strength of our engineers and how we have to work with our customers to really make this volume grow. When you think about from a content, on a traditional combustion engine, due to the trends I just talked about, what occurs on that combustion on a model, we typically get about 1.5 multiple of content to a hybrid and then about 2x content increase on a pure electric. So if something has $60 today of content on a vehicle, an opportunity to get closer to $100 on a hybrid and you could go up to basically $120 on a full electric is the simplest way to think about it. So that's the excitement we have around the content growth, and that comes into the emissions. So we think we're very well-positioned, we think we're positioned globally in all regions of the world around the players in that market and it is part of our content growth story of how we position ourselves and it's investments we've been making.

Extremely helpful. And as a follow-up, I wanted to dig into the comment of – I think the comment was your orders are being constrained by other issues in the supply chain. And so, you're under shipping true demand right now, is that the way to read it, or I guess, or is the worry that you could see orders cancelled if supply of these other products convey? I wasn't exactly sure how to read that comment of.

I would guess it's a fair question, but really what it is, is what we're seeing is in certain parts of the supply chain, you see this in some areas and so forth as lead times have expanded, we've seen some customer behavior place orders now that are a little bit more extended. So when we typically think about our orders, our orders are typically pretty current. We typically have orders that are for the current quarter or further out. We've seen some extended placement out, it is not that we're under shipping demand it's just that I would say people are making sure their supply chains are lined up for as they are doing production because they've been surprised in certain categories. So it's why when we look at our double-digit order growth, our guidance is more mid-single digit growth in the fourth quarter because we see orders placed out to the far first fiscal quarter and into second fiscal quarter. I don't see them being cancelled. I just think there will be things that will smooth out over time.

Your lead times in this are pretty normal.

I would say when you take our lead times, collectively, yes, they're pretty normal. There are some pockets, like Heath talked about on his automotive question, as well as some of our businesses where you see 14% and 20% growth. They've extended a certain product category, but it's very pocketed, not broad based.

Okay. Perfect. And congrats on the results, guys.

Thanks, Shawn.

Thank you, Shawn. Could we have the next question please?

Thank you. Our next question comes from Amit Daryanani with RBC Capital Markets. Please go ahead.

Thanks a lot. I have two questions as well, guys. I guess, first off, just on the auto growth that you guys are seeing this quarter, is there a way to think about how much of that – what's the fill in for December quarter versus things getting pushed out? Trying to get a sense on apples-to-apples how good is the autos for December versus to your point things getting a little bit more extended over here?

Yeah. I think it's pretty pure actually, Amit. So when you sit there, I think it's pretty pure. Things getting extended, I would not say. The automotive supply chain stays pretty tight, and that's why we have some of the extra cost to make sure we do not disappoint our customers. But in auto itself, I would say, when you look at the growth we've had, it doesn't pull in meaningfully or push out meaningfully because that's why we've had the extra cost.

Got it. And then, I guess, Heath, I have a question for you on the OpEx, and just broadly how we should think about the OpEx run rate and trends as we go forward. You've talked that a fair amount and middle of the P&L focus and I think your SG&A has actually gone up faster than revenue growth so far this year. So just talk about the initiatives you have, and what's the right way to baseline OpEx as we go forward from here?

That's a good question, Amit. The year-over-year numbers on our OpEx are driven by a variety of things, including some of the bolt-on acquisitions as they layer into the P&L, with their full cost structures in play. But there are some things that we did specifically in the quarter, and we will continue to do at least in the short term, some things that we are investing ahead of our ability to take out some costs. So there's some things that we've done in terms of outsourcing and so forth. We've had to spend a little bit of money ahead of when we'll see those savings. And that's part of the overall strategy to reduce SG&A as a percentage of sales. Sequentially, we made a little bit of improvement on SG&A as a percentage of sales. But we are up year-over-year. And some of it is the spending ahead of those cost reductions. And then, there's also just some performance compensation related costs given where the results are coming in this year. So there's a variety of things that are in there. I'd say as you look forward the strategy continues, and it's pretty broad-based across the company to better align our SG&A percentage of sales but we are also – some of that is to fund – reinvest it to fund other parts of the company, specifically where we have growth platforms that – we have a very strong pipeline and opportunity set there. So we'll continue to refine this and tighten this up. But there was a variety of things that drove the increased overall OpEx in the quarter.

Perfect. Thank you, guys.

All right. Thank you, Amit. Could we have the next question, please.

We have a question from Craig Hettenbach with Morgan Stanley. Craig M. Hettenbach - Morgan Stanley & Co. LLC: Yes, thanks. I have a two-part question on automotive and then a follow-up. So, in autos, can you talk about just given some of the lingering concerns about North American weakness in that market just how you guys kind of look at the sensitivity to that. I think North America is 20% or less of your auto business, but if you could just update on that. And then, the second part of the automotive question, just an update on the timing of the sensor design win pipeline and kind of timing for revenue.

Sure, Craig. Let me take that, and I think when you think about North America automotive, I want to take a step back and frame global automotive first. We have to realize there's 90 million cars, plus or minus, made on the planet and 17 million of those cars are made in the United States. So I do think we have to remember, 50 million of the cars made in the planet are in Asia, and well in the mid-20s are made in Europe. So North America while we live in every day as Americans, it is the minor part of production when you think about it globally. Our automotive business in North America, and we look at this year, like I said, we have about mid-single-digit growth here in the quarter. So we have the same content trends but the size or sensitivity is only about $800 million of total TE. So, it's only about 6%. And even as you said North America automotive production went down 5%, and we decline with it, it would be $40 million of revenue and a couple of pennies. So, I think about it, I think it gets a little bit too much press when you think about TE versus our great global position we have in automotive. And if we correct it by 5% production, it will be couple of cents in the big picture. So, certainly we won't want to see that, but it won't be a big thing in the big picture of TE. On sensors, your second question, when we sit there our turf momentum that we talked to you about in many quarters is continuing. And what we really appreciate is that the programs that we're winning across the sensor portfolio that we got with mesh (39:40) the…

Sure. In the deal – well, the deal hasn't closed. We have discussed it as we're getting closer to that. Hirschmann, it's a nice product line, tuck-in for our auto business, bring some great antenna technology where we see some nice synergies that we will realize as we bring them forward through our channel, our auto channel. So we looked at that as an opportunity both from where does it help us from an overall return profile and where are the synergy opportunities, and we're able to identify several things, especially on the commercial side; and then on the operation side, there's some things we'll bring to the table as well. So it aligns really well with the way I would think about bolt-on M&A, things that come in and we can get at reasonable valuations, and that we bring something to the table that as under our ownership there's value created for the shareholders. So this is not one that's far afield from what we do today. We understand the technology, we understand where it sits on the car, we understand how it aligns with what we do already in the connector and sensor world. So it's a nice opportunity for the team, and I think our team did a really nice job identifying the opportunities and have plans to execute right out of the gate. Craig M. Hettenbach - Morgan Stanley & Co. LLC: Great. Thanks for that.

Thanks, Craig.

Thanks, Craig. Could we have the next question. please.

And that comes from Joe Giordano with Cowen. Please go ahead. Joseph Giordano - Cowen & Co. LLC: Hey, guys. Thanks for taking my questions here. Just a follow-up on the earlier question on sensors. As that starts to deploy, can you talk about the margin implications for the auto segment? I know we talked about plus or minus 20% now, but my understanding is that the sensor portfolio is less than half of that right now. So where can that go, and what do you think that could do for your more or like medium-term outlook for margins in that segment?

Hey, Joe. This is Heath. First of all, good morning. That's a fair question. Listen, our sensors business is an area that we are investing in, and we are investing now ahead of the growth, but we're pretty confident because we've won several platforms that we'll see even some kick into production in late 2018, and we're really – we'll see the benefit of the volume from that in 2019, 2020, and so on. And that pipeline continues. From a profitability perspective, there is no doubt that it is dilutive to the overall segment average. Now, just to qualify that, we do carry a lot of intangible amortization in that particular BU, that business unit, because of the Measurement acquisition that was done almost three years ago. So, I don't know that we'll ever again on a GAAP basis, I don't know that we'll ever get to the 20% from sensors. But sensors margins have improved significantly year-over-year as we've seen them improve, but we would expect them to ultimately be in the mid-teens from an operating margin perspective, given the growth opportunities in some of the investments that is required there. We're not there yet though, and I think we're still couple of three years away. But we're moving a couple of hundred of basis points a year. Joseph Giordano - Cowen & Co. LLC: Great. And then to follow up on SubCom. Can you maybe frame us the cyclical outlook for this business? I know it's structurally probably in a better position now than it's been like maybe potentially ever, given who your customer base has evolved towards, but given your pipeline here, how long do you think this cycle can extend here, and how would you frame out like where trough level in the current dynamic looks versus where we've seen historically?

Hey, Joe. Thanks for the question. It's Terrence. And great question. I think when you think about SubCom, you're right on. When you think about the customer dynamics versus where they were 5 to 10 years ago, it's clearly a customer dynamic that you actually have the real user relay to the business model doing it. So that's always a plus and I feel very good how our team been executing organic wins with those important customers. When you think about it, this year we're going to be a little bit below $1 billion, and I think as you look into next year, I think our fair assumption is sort of keep that flattish because we do get to a level of capacity constraints as well as have orders that are coming in and the routes we're building. I think as we sit there, some of the things that we continue to think through is what are the next routes to those customer needs, how do we schedule that. So, it does not feel to us that you would have the trough cycle we've had in the past when you had customer dry up or customers be impacted by financing cycle because these customers do have capital and do not need capital markets. So we're still in the middle of what trough is, but it still feels like a business that the trough is much higher. I think it begun probably in the $700 million to $1 billion range, is what we've been telling people, but I would say we're still trying to figure that out. Joseph Giordano - Cowen & Co. LLC: You think trough can be $700 million is that what you just said?

Yes. Joseph Giordano - Cowen & Co. LLC: Okay. Versus, like, half of that last time right?

Yes. Joseph Giordano - Cowen & Co. LLC: Great. Thank you.

Thank you, Joe. Can we have the next question please.

We have a question from Matt Sheerin with Stifel. Matthew Sheerin - Stifel, Nicolaus & Co., Inc.: Yes. Thanks, and good morning, everyone. Just first question a follow-up to Shawn's question regarding the lead time issues and the fact that you're seeing extended backlog from customers. But as you look at the non-transportation markets this quarter, Terrence, it looks like it's in line to maybe still a little bit better than seasonal. So, is there a sense that customers are building any buffer inventory and can you get a read on those inventories and probably easier for you to look at that distribution which is a smaller percentage of your revenue, but in terms of what you're seeing there in terms of inventories?

Yeah. Matt, you're exactly right. So, let me take it from what we're seeing through our channel partners because when you go outside of Transportation and you're into our Communications segment excluding SubCom as well as our Industrial segment, you do have about 40%, 50% of those businesses go through distribution. So I think that's the right way. It's just the latter part is how you asked it. What we're seeing, we're seeing right now through our channel partners, they're having point-of-sale out that's pretty much high-single digit and their inventory has been very flat. So we don't see inventory building up in the channel and staying very consistent with where it's been. So, we don't see creep up there. And the order rates that we're having from our channel partners were pretty similar to our company average in a low-double digit. So, the dynamics we're seeing through distribution, I would say, are consistent overall. We're not seeing inventory getting ahead of itself. And I would just say when we look at those markets from a direct customer where we service the larger customers direct, it does feel like it's demand. I mean, we're seeing improving markets globally, and what we're seeing and how we're seeing it is these are due to production increases by our customers where we deal with customers directly and not through our channel partners. Matthew Sheerin - Stifel, Nicolaus & Co., Inc.: Okay. Great. And just as a follow-up. Terrence, in your closing comments, you talked a little bit about thoughts for fiscal 2018 in terms of at least the seasonal start to the year. But as you look out at your various end markets going into next year, obviously, you're seeing accelerated growth. What are your general thoughts about the sustainability of that growth by end market, if you can?

We'll guide, Matt, when we get to our first quarter call. So, I just think some observations I would make as we exit there. I talked about, certainly, I think with what we're seeing, we would expect a seasonal coming out of the quarter four and the quarter one. I think when you take the bigger picture, and I think about next year, number one is the content growth story we have in automotive, I think, is very evident of the traction we have. And I think it's fair to assume that automotives, being in this flat to plus 1% production environment where we are right now, would continue into next year. And I think we've been very clear that we think we can grow mid-single digit in it. I think when you get into the industrial markets, I see them improving. So I think sort of where we're running right now, our strength in the medical market certainly what we're seeing along factory automation applications which is real demand when we see it with the servos, the drives, the robotics. We're seeing that and we're winning in those applications. And certainly, medical. We talked about being a mid to high single digit grower. And the Communications area. I think SubCom, back to Joe's question, I think I would think about that being flat next year. And then in D&D and appliances, I think you would have things that would be closer to where those markets are, after a really hot year. So I think that's the way I would probably think about the growth going into next year just sitting here today. And we'll give you our formal guidance when we talk to you in November. But that's just, as you all think about it maybe some ways to frame it, based upon what we're seeing here without formally guiding. Matthew Sheerin - Stifel, Nicolaus & Co., Inc.: Okay. Great. Thanks so much.

Thank you, Matt. Could we have the next question, please.

From Jim Suva with Citibank.

Thanks very much and congratulations on the results.

Thanks Jim.

When we look at the outlook and maybe my math is wrong, are margins going to be down year-over-year in the September quarter, and is that due to the extra week, or how should we think about the puts and takes around the margins year-over-year, not sequential, but year-over-year?

Jim, when we discuss our Q4 and we discuss what we think about when we guided the organic outlook, as well as how we will talk about it here in 90 days when we get on the call, it's going be apples to apples year-over-year on a 13-week quarter that we discuss for fiscal – for of Q4 2016. But we would not expect. We do not expect any year-over-year leakage on our operating income margin.

Okay. So, you're saying the year-over-year operating margin should be up then?

Yes. On an equivalent 13-week to 13-week basis.

On an equivalent. Got you. Okay. And then my last question is, one thing to note is the margin increase in the Communications Solutions was very big. Is that completely sustainable? Is it due to revenues? Was there anything in there, or should we just equate that to kind of the go-forward improvement in your Communications profitability?

Jim, when you look at – it's Terrence, I think there is two pieces to it. The biggest piece is the efforts we've done over the last three years to get that business focused on high speed and move away from the consumer device base primarily. So when you look at the big growth, it's really the culmination of the cost actions as well as the focus of the portfolio that we did in that segment mainly around D&D. Secondarily, we also did get benefit. SubCom had a very strong organic growth of 22%. So that's also contributing to the increase. I think longer term you should think about the segment margins staying around mid teens, depending upon where the businesses are, but that's where I think you can think about it, but a lot of that margin improvement was structural impact that we've been driving over the past three years that we've talked to you all about.

Great. Thank you very much for the details. That's greatly appreciated.

Thanks, Jim.

Thank you, Jim. Could we have the next question, please?

We have a question from William Stein with SunTrust.

Great. Thanks for taking my question, and good morning. Terrence, I think you mentioned that there were supply constraints that were limiting the fiscal Q4 revenue that perhaps if there weren't shortages, for example, and imagining that's passives, that revenue could be higher. Any quantification on that?

No. Well, just to make sure what I said maybe I wasn't clear, when we look at that, it's just our orders have been placed on us because people are worried about the extended supply chain, and we were impacted by that. Our revenue is going to be pretty pure. I don't see anything impacting. I wouldn't say our revenue in the fourth quarter. It's just our orders were higher. On the items that Heath talked about, maybe around Transportation, it's not related to passives. This would be base metals, some plastics, things that we actually use on our manufacturing that because our demand was higher, certainly a good problem to have, and it has created inefficiencies not only in the extended supply chain, but also bringing in our factories, we had to do more changeovers to make sure we didn't disappoint our customers, which we're always going to do. So, hopefully that clarifies it.

Appreciate that clarification. It helps. One more, if I can. You noted or someone noted, Hirschmann. I think there was another acquisition that was announced recently. Can you remind us what the total revenue impact is, and then I believe that revenue from those acquisitions is not included in guidance. Maybe those deals haven't closed yet. Can you clarify this?

The other deal we closed which was a small tuck-in within our medical space was a business called MicroGroup. I'd say we have not even closed on Hirschmann yet. So the impact in the fourth quarter is going to be very, very small in terms of what the combined impact of the two deals are. I think if you're modeling for next year, those two deals will probably add about a point of total growth for the company on the top line and we're still working through what the bottom line impact would be as we get through all the purchase price accounting and so forth. But not a huge number as the first year as we work through some of the integration plan. It will add about a point of revenue at this point for next year's revenue.

Thanks and congrats on the great quarter.

Thanks.

Thanks, Will. Can we have the next question, please?

We have a question from Mark Delaney with Goldman Sachs. Mark Delaney - Goldman Sachs & Co.: Yes. Good morning, and thanks so much for taking the questions. Two questions for me. The first I was just hoping you can elaborate a bit more on China auto. I know that was very robust in the December quarter. It sounds like it stayed pretty strong throughout the year. I think even in June, China auto was good. So, maybe you can talk about how sustainable and what you're thinking about in terms of your views on China auto into next year.

Yeah. Sure. China auto as we spoke early in the year was extremely strong back in that first quarter as the incentives were benefiting, and you saw it in the registrations. You saw it in their production. What's been nice is, China auto is sort of have played out as we expected. It was a little stronger in the first half, but as it worked down post the incentive, it's been in line with what we have expected. And the other thing that's very nice to your point, you're starting to see registrations turn positive, and what we've also seen is that dealer inventories are back to normal levels in China around – we typically like to see them around 40 days and that's where they're at. So it doesn't feel like there's a hangover of where production is. And so, when we look forward, clearly, we'll have a compare that we'll have to deal with them in the first quarter, but we see the content story being very strong, and I think China will continue to have production growth. So, very positive on it and it's actually nice that it's come in line with how we expected. Mark Delaney - Goldman Sachs & Co.: Yeah. That's helpful. And a follow-up question on the Industrial margins. Could you just better explain what the reasons are that the Industrial margins have been soft, and is there any quantification of what kind of benefits we can see from the actions that the company was discussing on the call to improve those for next quarter?

Sure, Mark. The pressure on the Industrial margins year-over-year was almost entirely out of the commercial aerospace area where we were down year-over-year that – our commercial aerospace margins tend to be pretty profitable and now ahead of the segment average. So when we see a decline in that space, that does have an impact on the segment margins. There were also some things that we're doing that impacted the margins. As I mentioned earlier, some of the spend ahead of the cost reductions that layered into the Industrial margins as well. But we're committed to improving the overall segment margins. We see a path towards that. There will be some footprint consolidation pieces that are part of that and that will take some time, and we'll continue to quantify that as we move forward. But we do see our fourth quarter if we just look in the near term we see the Industrial margins year-over-year and sequentially to see a pretty significant improvement based on just where we see the mix, and where things are heading there right now. But there's a longer journey there for the Industrial margins over the next couple of years. We look forward as we get further along in that journey to discussing it more externally. Mark Delaney - Goldman Sachs & Co.: Thank you.

Okay. Thank you, Mark.

Thank you, Mark. Could we have the next question please?

And we have a question from Sherri Scribner with Deutsche Bank.

Hi. Thank you. I just wanted to dig a bit into the Subsea segment where you're having a positive cycle. I think historically when Subsea has been at the bottom of the cycle, that's been dilutive to margins and when you're at the top of the cycle, it's been accretive. Now with this new range and a higher trough, do you see the business as being as dilutive in a trough year or is that going to be more similar to typical Communications margins as we move forward with this different range? And then, my second question would be, where should we think about the tax rate next year, given you've had some tax benefits this year? Thank you.

Hi, Sherri. Thank you for the question. First on Subsea and then I'll let Heath do taxes. On Subsea, I think when you look at it, when we talk about it historically, it would be – it has a benefit in an up cycle SubCom and if you went down the trough, how you look at it. It is a very strong business model from an ROIC no matter where you are. I do think it would be slightly dilutive to the Communication margins in the lower part of the cycle, but clearly not as dilutive if you were much lower like it has been in other parts of the cycle. So, I think you can think about it a little bit more linearly. Clearly, and always margin comes into which are the projects we have going, which projects we want, but I think when you think of it from a volume basis, clearly it won't be as dilutive as it was before. And Heath, I'll let you talk about taxes.

Well, Sherri, forecasting a tax rate is fairly volatile just given how complex and where we operate in the world in the structure and not to mention what goes on with the world with various tax authorities and the changes that we have to react to. So, I would say if you're going to model it, model it around 19% for next year. We said the longer term rate is 19% to 20%, and we'll continue to give you update understanding that at any given quarter, there's going to be things that swing it around higher or lower, but I'd say 19% if you're thinking about next year is pretty good rate to be thinking about.

Thank you.

Thanks, Sherri.

Okay. Thank you, Sherri. If there's no further questions, I want to thank everybody for joining us on the call this morning, and if anybody does have questions, please contact Investor Relations at TE. Thank you, and have a great day.

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