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Financial Services Innovation Lab, Georgia Tech 19

CTAS

Q1

Christopher Gutek:

Michael L. Thompson:

Okay, fair enough. And then there as a follow-up on the notion of having done a… having completed a strategic review. It sounds like if I am interpreting your comments correctly, is that the… there is no intention of doing anything aggressively in the short-term here from a strategic perspective, but I am curious if there is anything still on the table short of what was considered as part of the strategic review for example try to monetize some of the real estate assets or changing some of your sourcing to buy uniform from Asia or anything else more from an operational perspective that could be incremental to margin improvement opportunities, you talked about in the past shy of the strategic review.

Well, I think our job is always to look it for opportunities and the Board’s jobs is always to look for opportunities to enhance shareholder value along with management. So, everything is always on the table and we are always looking for ways to improve things, but we don’t’ look… both long-term and short-term is to what makes sense. So, that’s continued activity that we are all involved with.

TER

Q2

Mehdi Hosseini

Mark E. Jagiela

Okay. Now so if the design wins help with better-than-seasonal trend in Q4, would it be fair to say -- to assume that there's also a probability that Q1 could turn out to be better than seasonal because of the design win?

Yes, that's possible. But I would still say there is strong seasonal patterns, like there is in SemiTest. So the design wins can help. But our design win, we believe we are going to start as the second source guys, so we're going to start at a lower share. So to us, they're very strategic. We can't say the names of these accounts, but they're very -- the accounts we'd want to be in. So we think, long term, we're in a very good path. It's just that the dollars probably will be smaller than the importance of these strategic wins long term.

GME

Q3

Arvind Bhatia

Tony D. Bartel

Just a couple of questions here, guys. One, I wanted to see if you could give us a sense of what you're seeing in tie ratios for the PlayStation 4 so far and maybe compare that to what you saw early on either for the 360 or the PlayStation 3. And then also, the 20% to 30% industry growth guidance you guys -- or not guidance but how you guys think about the industry for next year, is there any change in your thought process? Are you guys more comfortable with that kind of number as you now have more visibility? And then I have a follow-up.

Sure. We're working very closely with Sony to make sure that we partner with them and giving them the consumer feedback and working closely to make sure that we have a great product there. But our associates, part of their training was to make sure that when people opened that product up or as people went to use it, they were -- had a great experience. So what we saw is that when you look at the all of the PlayStation Plus subscriptions that we've sold in our lifetime as a company, and we've been selling them for years, the full 1/3 of all subscriptions we've sold in our lifetime were sold in the last 7 days at GameStop. So that shows you the strength of attach that was over 1/3 of the products went out with attach on that, and that's growing daily as we have customers coming back into our stores on a daily basis to pick up PlayStation Plus, so...

ICD

Q1

Kurt Hallead

Philip Choyce

So $600,000 to $700,000 from rigs. So you go from 17 down to six, so 11 times whatever $600,000 to our working capital contribution.

Right. That' correct.

EXPE

Q2

Naved Khan

Eric Hart

Yeah, thanks a lot. A couple of questions. Maybe just one for Eric. If I look into the deferred merchant bookings, we're up 25% versus 2019 % versus 2019. Could you just maybe help us understand the gap there? What does -- any differences in the 2 numbers? And then I have a quick follow-up, maybe just on the simplification of the business. Are there other opportunities that you see on the to simplify the business further?

How about I take the first one and Peter probably take the second one. So, on the first one, we -- are deferred merchant bookings balance was approximately 8.24 billion as of the end of June. And if you compare to June the previous year, it was approximately 4.6 billion. There was an increase in what we call core deferred merchant bookings, which is our more traditional or conventional locking business. And that reflects obviously improvements on our, I guess that's compared to 2020. So, I think you'll see on the core business that it's largely in line with where the real differences are coming on the side of the business that ultimately is -- and remember that is restricted. There are approximately 4.26 billion in that deferred merchant bookings for Vrbo and that just reflects the healthy growth that we've seen at Vrbo, that we've talked about a number of times before. I would say that there's no increased risk, if you will, on that core relative to, I think, where we were in 2019.

B

Q4

Edward Marshall

Gregory F. Milzcik

Flattish, okay. And so your customers saying up 10% -- 5% next year certainly means there's upside to that number?

Potentially, but they have been wrong before.

GCI

Q3

Barry L. Lucas

David T. Lougee

Just a couple of quickies really on the TV side. One on the approvals process, and particularly DOJ, any color you can give there, as well as the FCC. And then two would be the, I would say broader threats to broadcast. Any thoughts you have and can share on Aereo and Barry Diller and/or this little spat that's grown up with [indiscernible] and DISH and Media General. And it doesn't appear to me to be an argument over $0.05 or $0.10 per sub per month. So any thoughts on any of those subjects will be greatly appreciated.

On the DISH and Media General, I don't think we should comment specifically on any particular company's negotiation. But generally, I'd just say, as the NAB has pointed out, that in the very, very few cases where there's been any kind of discontinuance of service, it's been 1 or 2 providers for the most part or 3 across, and that we don't believe that's an accident. As it relates to us in terms of risk mitigation, we have very strong stations that are very valuable to the consumers in our markets and like our situation relative to our value proposition. I don't know if Marci Ryvicker is on the call, but Wells Fargo put out a piece just a couple of months ago that talked about accurately so that, I think, in 2012 broadcasters will account for 35% of all of the viewing nationwide and yet 7% of the subscriber fees. So what you have there is still a lack of market alignment that is positive for the industry overall. And irrespective of what may happen with an individual negotiation with other companies, the truth is on our side, as we'd like to say, as it relates to the market realities.

IM

Q2

Brian Alexander

Gregory M. Spierkel

And my final question just relates to Dell and what they might do from a two step distribution strategy. I don't know if you have any additional insights relative to last quarter that you can share in terms of your expectation as to whether they embrace two step distribution in particular geographies as they expand their channel strategy

Brian, it is Greg here. I mean nothing really overshadowing, and you clearly... as you know Dell is an important relationship for us, one of our larger customers through the software and peripheral supply that we have into their company and we been following and monitoring like everyone is. Their recent entry into the retail space and their ongoing touching if you may have a certain portion of the S&P customers that we support across North America and they have been more public about that in the last month or two. I suspect Dell will see how things go with the retail opportunity, I expect Dell will continue to asses all routes to market. They haven't... they haven't made any avert signals to go into two tier distribution, but if you are reviewing everything and I suspect you are reviewing everything and at some point they may surprise us all but at this stage there is nothing else we can say because there is nothing else that we are aware of that they are doing in two tier right now.

AAPL

Q2

Toni Sacconaghi

Tim Cook

And then finally I guess one for Peter, quickly in response to one of the other questions, you talked about considerations for margins in terms of forces that work to the degree that you can – can you help give us a bridge in terms of your thinking whether it’s qualitatively or quantitatively about how we think about 36.4% gross margins this quarter to 33% next quarter, can you rank order the forces, can you explain and then rank order the forces in terms of their impact on that expected deceleration?

Yes on the – and I will say the larger two out of three are the stronger US dollar and seasonally lower mix driven largely by the beginning the education buying season. Let me talk about each of those. Regarding the dollar, the dollar is all but stronger today than where it was throughout most of the March quarter. But the – the bigger impact for us on a sequential basis regarding the dollar is our hedges. In our December and March quarter, we had the hedges in place that we’re put in place at the time that the dollar was not as strong and the hedges that we have in place for the June quarter largely we will put in place during March at stronger dollar levels and that’s really what is the – is really the driving factor behind the sequential impact of the dollar. And of course the ed buying season begins in the June quarter and June tends to be more dominated by K-12s than High Eds. The September quarter historically is stronger for High Eds than for K-12. And K-12 being more of an institutional sale and we expect to be competitive this year especially given the funding situation that tend to strike.

BGFV

Q2

Adam F. Engebretson

Steven G. Miller

Okay. And then, maybe clarification. On the quarter-to-date trends, did you say that those were tracking positive? And if so, would that employ -- imply that the quarter-to-date comps were also positive?

Well, I said that they were off to a solid start, and you can -- a takeaway from that is that yes, they are tracking positive and quarter-to-date trends are positive and certainly consistent with the guidance that we provided for the entire quarter.

CTXS

Q3

Jason Ader

David Henshall

Yeah, thank you. I have two quick ones. First, for fiscal 2021, the 4% growth. Can you quantify the headwind from the shift to subscription for us? And then secondly, just on the networking side, David, can you talk about some of the demand in that space? I know you have the shift to subscription that's also creating some headwinds to top line to revenue from networking, but what's the demand in that space? And how do you see that evolving from here?

Why don't I take the second part of that first, and then Arlen can talk more about the 2021 number. So networking is an interesting market. I mean, it's clearly one that's in transition for a number of reasons, and some of those are things that we're trying to accelerate. When I see hardware in the networking area down, 20%, 30%, 40% in a quarter, there's a big shift going on. And clearly, in our business, that's been offset by software. Software is growing well over 50% year-on-year. But that's a lot of the outcome of strategy. And so what we're doing is really helping customers in this 'tweener right now. It's just every big customer I talk to is focused on some level of hybrid execution. There's really nobody that is 100% on-prem or 100% in the cloud anymore. It's always somewhere in the middle. And what we can do with our networking assets, of course, is help bridge that fork, being able to deploy networking services across any different form factors, to have a management plane on top of it, which we call ADM, that allows them to run those resources in a public cloud, on-premises in any form of hybrid they want to yet still control it with a common infrastructure. And that's something makes us unique. And that's one of the reasons why when I look at our networking business, and let's exclude the big hyperscalers for a minute. But I look at our networking business over the last few quarters, we have likely outperformed the underlying market. So we're helping drive that transition. And something I said earlier about, we'll continue to do that, but we're also really focused on leveraging networking services in a tighter, more integrated way with the integrated workspace to ensure workspace security, workspace delivery, workspace performance. And so we're kind of working both sides of that strategic equation. And I'd say the overall dynamics in the market should track relatively closely to the types of business outcomes we're showing.

HOME

Q4

Simeon Gutman

Lee Bird

And then Lee just on the competitive landscape, some home improvement retailers are going deeper on the home decor category. There is more free shipping offers throughout the market. Are you seeing any changes in the competitive landscape right now?

You know I love our marketplace and it's growing. It's a healthy business. It's fragmented. I don't think the intensity really has changed. I do I have seen what you've seen as well most retailers are reporting strength in that category. What I like is our position to compete we're a value retailer. We provide a treasure hunt solution to shopping. We've got the lowest prices out there that’s the one I'm most proud of honestly. We're still proud of our prices we've put all of our assortment on online so you can see it on pricing transparency. The direct sourcing an effort that we're putting in is going to allow us to take prices even lower. And I would tell you our model is a model that makes it very difficult for others to duplicate. We can value engineer, styles that are out there and over 70% of our product is private label. I would tell you over 80% of our sales are full price and that’s full prices are below other people sales price. We've got a self-help labor model in the stores they’re low cost structure very low real estate costs go low Home Office cost and D.C. and occupancy cost. We keep cost structure tight. So that enables us to have these great prices. So yes the marketplace there is a lot of great competition out there. I'm impressed with what they're doing with comp shop every single month, every single one of our competitors. We're staying very close to it give an example. Our most recent comp shop we’re 40% below Amazon sales prices. We're really pleased with that. We continue to pay attention to the online players as well as the brick and mortar players. And I love our competitive position and will continue to focus on that.

BLDR

Q3

Matthew Bouley

Peter Jackson

Okay. Understood. Thank you for that. And then, on the manufactured products business, the 21% growth, I think I heard you say double-digit on volume. Is there any finer point you can put on that volume versus price there? Because it's just – obviously, given what you mentioned around the market growth next year, I think it would just be helpful to understand your growth relative to the market and so how we can think about that into 2019? Thank you.

So, I mean, we don't have any real market information that we feel comfortable banging up against. I mean, I think that when we talk about single-family, we have some high-level starts numbers, even that's tough given the changing size and profile of the homes that we sell into. We feel very good about our performance. We think we're at or above market. We think we're holding or gaining share as far as value add goes. Yeah, there's a good chunk of commodity inflation and pricing change in the number this year, but we're still solidly in the double digits for growth in the manufactured products, I think still in that double-digit range for consolidated value add, so clearly market share being taken in that space. I think it's consistent both with the investments we're making as well as the market adoption of that sort of labor-saving service that we provide in that space. So we feel like that is very healthy and I think consistent that we've seen pretty much all year and through last year. So we feel very, very good about the investments we've made and our continuing commitment to that space. We think our customers like it and it continues to get great traction.

TGX

Q4

Frank Tarallo

Just real quick, how much was on the books with Core at termination? Yes how many sales.

Joseph Munda - Sidoti & Company

We are in sort of the middle of the quarter, I don't know that I can give exact numbers but I can tell you that 14% of our break-even revenue last year is what core was which was about $3.2 million and so that can probably give you an idea of what might have been on the books one month then. As far as the exact numbers I cannot really disclose in the middle of the quarter.

SYKE

Q1

Adam Dahms

John Chapman

Great. That makes sense. And then if I could just one last on margins. There is kind of like there moving parts I am looking at, the suboptimal client elimination, FX impact and then the communications volume weakness. I am just curious how those three component factor in the full-year margin expansion plans?

Well, the suboptimal program is roughly 2% of revenue. And we expect FX to be roughly a five point impact on revenue this year. And so you could see roughly speaking we have got, 1.3% in total, we are looking at 7.7% growth in new business. So this is margin. The suboptimal business is 2% and FX is 5% and our overall net growth in constant currency is going to be 1.3%. The margin impact is pretty big contributor [indiscernible], the negative [indiscernible].

TECD

Q4

Brian Alexander - Raymond James

Jeff Howells

Yes, just a follow-up on the inventory. It was down sequentially more than sales but I think it still a little bit elevated relative to the historical levels. Can you just Jeff, elaborate on why that’s the case and in what regions and product categories to the extent you can comment remain more elevated that others in just what your targeted inventory turns are, going forward, how could we get that down?

Yes, I think first of all we are very happy with the inventory, and two, we are happy with how much of that we own versus our vendors own. The increase in inventory was offset by the increase in accounts payable. I think, if I look at one factor and there is always many factors Brian, it's just as Bob alluded in his comments, sales decline accelerated in January. And so, probably ended up with a little bit of extra inventory compared to the sales that we experienced in the month of January. So, on the positive side, our inventory is clean, the ageing is strong. It will sell-through quickly or already has in February. I think also when you are doing your analysis and comparison the numbers that we just reported, of course, compared to others includes the month of January. And not to overemphasize but from every vendor and their comments about their Q1 forecast, we know that the decline in the market accelerated as we entered the new calendar year. So, I think that shows the strength of our operation especially through the end of last calendar year. So, inventory is good, inventory is clean and we still anticipate having 26 to 28 days inventory on the shelf.

BMY

Q1

Steve Scala

Chris Boerner

Thank you. Your comments on the liso-cel PDUFA extension reflected no real concern whatsoever. And it's one of the four new launches you called out for this year. It seems you are completely comfortable with the FDA meeting the regulatory timeline. I just want to make sure that that's the impression you wish to convey to us? And then secondly, it was stated that the COVID-19 could lead to inventory destock and a drop in patient visits to infusion centers in the second quarter as well as beyond that. I'm just curious, what was the decline in these metrics during the month of April? Thank you.

I think you've managed to hit on the key points. The only other thing I would say is that the drop that we've seen in patient volume and particularly in new patient starts has varied really across therapeutic areas. So in the CV space, it's been sort of on the order of 20% to 25% across the NOAC class. A lesser extent in oncology and the tumors that we are in, it's been on the order of 5% to 20%. And as David mentioned, that has led to some choppiness, for example, in Opdivo sales in April, which we think is attributable to the new patients, to the drop in new patient starts. That said, we would expect that as David had mentioned, that would the biggest impact for that would be in the second quarter that would begin to normalize and be back to more normal levels by the third quarter - by the fourth quarter, and that's what we'll be continuing to monitor.

ABC

Q4

Eric Percher

Steven H. Collis

Thanks. I think I'll follow the same line, but maybe a few items that were implicit, let's make explicit. So one item you mentioned that you look to gain share back with the lost buying group from 2015, was that effort limited in scale to APCI (55

Yeah, I'll make a quick comment on each of those three. We did lose a buying group customer. It was a customer where a lot of the members were GNP members and a lot of them chose to stay with us. But I don't want to get too much into specifics. It's not that overall material. I think it's always interesting, lose a relationship with a – and I think it's a shared relationship, between a buying group and a wholesaler. So that's why that having long-term contracts is extremely important, so that we can work together on what – the collaborative approach that I referred to in my script. So I think actually that last year is a pretty good example of that and it probably wasn't good for the buying group, wasn't good for ABC, but not – it's one of those things that happened. I wouldn't say that that pointed to some acute level of competition or anything, or any of this drama that we've heard about a price war. So the incremental share that we've had in independents is very – I think, we just are making sure that we're holding ground with those new contracts we've signed. And we did work to try – keep some of those former buying group customers that had switched to a new wholesaler. We did work to keep them with ABC, but kept that in line with overall market, because again, people talk to each other. It's an efficient market, so we want to make sure that anything we do is responsible and balanced. And then the telemarketers, I would say are struggling a bit, because I think ourselves and our peer companies are looking at that compliance factor and have better tools to manage that. And there's not the growth that you had from so many new product launches. And I talked about our First to Shelf program. So if we had any gap where we weren't getting product out upon a patent expiration fast enough, we're covering that. So we're saying to our customers, no need for you to order from a telemarketer. We're going to get that product to you first. And that's one of the examples, Eric, of an enhancement we've made to our business. I think, Tim, I've covered everything. So we'll probably move on to the next question.

RRD

Q4

Kannan Venkateshwar

Thomas J Quinlan

A couple of questions. First, on some of the events this quarter. I mean, first was the Meredith transaction. It would be great if you could tell us how that impacts you.

Yes, we could. On the Meredith transaction, look, I think as you go -- as everyone goes through it today, you continue to see, as I talked about earlier, strategics looking to combine to take advantage of scale and take advantage of synergies. I think we're at that phase of the recovery. So we're -- as we sit here today, as you look at our platform, we are able to serve customers that are in that way.

BLDR

Q3

Trey Morrish

Chad Crow

Got it. Thanks for that. And then more high level, labor constraints are definitely a – we think are going to be a challenge for the remainder of this cycle, even if you're going through a period of slower growth. Could you talk about, with your large footprint for manufactured product sales, how you expect that part of your business to evolve and develop over the remainder of this cycle?

Well, we're obviously making a lot of investments in that part of the business, the value-add side of the business, and expanding our footprint, and we will continue to do so. I do think the long-term trend is going to be less labor, less construction on the jobsite, and more done in plants or factories. And so, as we look further down the road – and I also think that labor is going to remain a challenge for the foreseeable future. So we're constantly investing in our truss and panel capacity, for example. And anywhere we can take some of that labor off the jobsite, I think that's where we're going to create the most value for our customers and create the most stickiness with our customers, and obviously that's going to result in higher margin.

SXC

Q1

Lucas Pipes

Frederick A. Henderson

Okay, that's helpful. So this -- with that, when I think about your guidance change for 2014, Indiana Harbor essentially unchanged from where I had it previously. What do you think are the big kind of levers that caused the numbers to come down a little bit?

I would say Indiana Harbor is a little weaker, I'm not sure about your expectations, but certainly, versus our expectations. Second is the rest of the plants actually did have a weaker first quarter start, as the coal logistics and coal itself. So we basically, as Mark said, take the midpoint of that range down about 12.5, we were down about 20 in the first quarter relative to our target, so think of it as putting in roughly half of the first quarter mix into the guidance range.

B

Q4

Matt J. Summerville

Christopher J. Stephens


Couple of questions. First on the transaction. Because I know your tax rates differed so much by jurisdiction, how much EPS accretion was there in 2012 from the business you're selling?

Yes. Again, for purposes of disclosure, Matt, we don't get to the SBU level.

AVNR

Q4

Mario Corso

Dr. Joao Siffert

Good evening. Thanks for taking my questions. First on the pain data, I feel like I’m hearing a little bit of mixed message. You used the word disappointing but I think the prior comments for the study was really designed to inform dosing for future studies and not necessarily expecting statistical significance for the study but again looking at correlation of blood levels and efficacy. And I’m wondering how you feel about that piece of it? And it certainly sounds like there is the potential for future development here with pain. So I’m trying to reconcile some of those issues a little bit. And then secondarily, I was wondering if you could talk a little bit about gross to net a jump in the fourth quarter and it looks a little bit higher for the full year ahead than it was in the prior year? Thanks very much.

This is Joao here. I’ll first address the question regarding the pain study. So we’d miss the primary efficacy end point which indeed was looking at the dose response as you mentioned. So that’s disappointing. The issue here is as we look to the overall development program is how to fit in the MS pain data which is smaller data set and on is specific type of pain, which is central neuropathic pain into the broader neuropathic pain development which focuses are primarily on peripheral neuropathic pain specifically in treatment resistant DPN pain. So that’s the -- that sort of the work cut out for us to look at the data in this totality as we entertain the next steps in the pain development program. We will look at the -- but the data from this study and the positive data, unequivocally positive data in the DPN Phase III trial which was well powered to technical difference and we will consult both internally and also with our key pain experts who have advised the company over the years.

B

Q4

Edward Marshall

Christopher J. Stephens

By what amount are you saying? Are you saying $400 million?

Roughly. Some cash will be outside the U.S. and our debt is sitting in the U.S, so a majority of which will be reducing our debt levels. We're going to take a look at -- we'll obviously take a look at the pension funding, as well as investments in the business. But the headline is, is we'll immediately reduce our debt, and about half the proceeds would be used to buy back shares.

RH

Q4

Tami Zakaria

Gary Friedman

Got it. That's super helpful. So, there's really nothing onetime or sort of unnatural something impacting this are, it's just being conservative - prudently conservative.

You can frame it that way. Yes, essentially. I wouldn't say that was wrong.

NVDA

Q2

Blayne Curtis

Jen-Hsun Huang

Hey, guys. Thanks for squeezing me in here, and great execution on the quarter. Two related questions. One, I just – Colette, I was just curious, your view on the return – use of capital and buybacks obviously an accelerated one, only $9 million in the last quarter. What's your view going forward? And then Jen-Hsun, maybe a bigger question in terms of use of capital, whether you could talk about – you said CPU is not an area that you would want to go into, but obviously GPUs have legs. I was just curious if you have to look around at other areas, maybe in the datacenter where you could also add value?

And long-term use of capital, I would say this that, you know what NVIDIA is really rich with is we're rich with vision and creativity and the courage to innovate and that's one of the reasons why we start almost every conversation with anything by gathering our great people around the company and seeing what kind of future we can invent for ourselves and for the world. And so I think our use of capital is nurturing the employees that we have and providing them a platform to innovate and create new conditions by which they can be successful and do their life's work. And so that's philosophically where we start. We're not allergic to acquisitions and purchases and we look all the time and we have the benefit of working with and partnering with companies, large and small, all over the world as we move the industry forward. And so we're surely open to that, but our natural posture is always to invest in our people and invest in our own company's ability to invent the future.

NMBL

Q3

Alex Kurtz

Suresh Vasudevan

It sounds like the October guidance from an enterprise perspective you guys assumed some large deals in the enterprise side we're going to close, right?

That is exactly right. Large deals and large enterprises were not as significant a contributor as we had modeled and we pulled investment from commercial to make that happen which reflected in not enough in the commercial side.

BLDR

Q2

Matt McCall

Peter Jackson

Okay, there are days here right here, there's an assumption of growth for the year.

Yes, low singles.

QADA

Q3

Bhavanmit Suri:

Karl Lopker:

My first question is around just getting kind of your professional services hires upto speed and well utilized, is -- do you have any leverage you could pull to accelerate that process or is this just kind of the speed that will have to happen and can you just call it a little bit more about how you see getting to better utilization in the fourth quarter?

Well, most of our licenses definitely come from existing customers who are expanding the use of our product, maybe going into factories and other parts of the world where they haven't been in. And we expect -- as the manufacturing economy is strong, we expect that to pretty much continue, although 60% of our funnel is cloud, so we expect to continue to have strong bookings on the cloud. Next year, as we look forward, we can't see anything that's necessarily going to slowdown the manufacturing economy. Having said that though, something happens at the stock market, that could definitely start affecting our customers' customers and then our customers; so we're always on the watch for that.

ROLL

Q4

Nick Stuart

Dr. Michael J. Hartnett

I just had one quick one piggybacking off of that prior question, can you talk about what you are seeing in mining that is giving you confidence in kind of a back-half recovery?

What we see in mining right now is the aftermarket is pretty much propping up the whole mining world. And so we look at the tonnage of copper and steel produced each quarter and see how well the mines are running, and they've been pretty consistent. So any OEM growth that you'd see out of some of the big producers would benefit those volumes. On the smaller side of the mining business, which we might classify as mining, but is really residential construction and street and highway construction and we just categorize it broadly as mining. That business really responds well to how things starts in GDP growth, so a little pick-up in that GDP area. And a little pickup in housing starts is going to help that business year-end and we're subscribing to an increasing GDP growth rate as the year ages.

VSH

Q3

Jim Suva

Gerald Paul

Thank you very much. Can you give a little bit more details you’d mention about the cancellations in Asia? Are those primarily like on the consumer side, handset side, T.V. side and some of the end-market cancellations that you’re seeing?

First of all, most of them come from distribution in our case which through a degree seem to be expected this because we knew all along that, of course, they had to hide the order rate before out of many reasons was high and we expected some correction. Anyway, and I think I said this before a few times. And so, it happened, but it happened immediately more abrupt seems to be typical for our industry more abrupt than we thought. And mainly it comes from distribution in our case but effectively this is indirectly consumer. This is consumer-driven I believe.

EXPE

Q3

Michael Millman

Dara Khosrowshahi

Well, I didn't really mean it to focus on Choice, but to focus generally and broadly if you're seeing -- and you kind of answered it -- seeing any impact from hotel companies attempting to move away from OTAs in terms of the economics.

Yes, I think the volumes speak for themselves, right? Our volumes are healthy both on a domestic and international basis. And I think that the big brands out there are doing what's smart, which is they have a diversified base. They advertise to bring direct players out there. They've got loyalty programs. They work with OTAs. They work with Google, and all of that helps them build out an occupancy base, which hopefully will allow them to build up ADRs. So I don't think that one, again, is exclusive over the other. I think a smart player builds a multichannel strategy and builds strength in every single channel that they have. If they're stronger with us, they will be able to build out their occupancy base inside their hotel and that will be able to drive premium ADRs in the industry, which is how you win. Again, we haven't seen any kind of negative trends, and our relationship with the brands are, frankly, terrific. As far as the Car business goes, we did see some increase in fleets kind of over the summer. The fleets have tightened up again. And I would say that, yes, the car companies in general, like the airline companies, are more disciplined on a capacity basis. Our Car business is growing nicely, and we want it to grow more. We're looking at opportunities to grow that business. But I would say in general, the Car business for us remains healthy. And in an ideal world, we'd like to see a bit more capacity, but we are seeing to date some capacity restraint, which reflects a bit more discipline on our car vendors than at least we saw two, three years ago.

GME

Q3

Anthony C. Chukumba

Robert A. Lloyd

Just wanted to probe a little bit into the Q4 guidance because it looked -- it just struck me as very, very conservative. I mean, particularly on the comp, 2% to 9%, I mean, you're going to be selling a ton of these PlayStation 4 and Xbox Ones at $300, $400. And so I guess, I'm just trying to dig a little bit into that because, like I said, I definitely get the mix in terms of the margins and obviously, the consoles are significantly lower margin. But I guess, that just struck me as conservative, particularly from a comp perspective.

Yes, we're very confident, Anthony, in how we've launched the PS4 so far, what we have on tap for tonight with Xbox One. But the -- we know exactly what's sitting in our stores, but the visibility into what our allocations are going to be for the rest of the quarter are -- that's pretty cloudy right now. So we wanted to make sure that we had a comp range to start with that reflected the unknown surrounding that. And then we wanted to make sure that we weren't overreaching in the expectation that we put on the console makers for what they're able to deliver to the system and specifically to us.

GCI

Q3

John Corright

Gracia C. Martore

Question one -- can you update us on what you see as cash pension contributions, which I think are nothing this year, but ‘010 and ’11? And also, I still think you have something like $1 billion of face value bonds that are due in ’11 and ’12. Have you been buying any of those in or do you plan -- do you think that’s a good idea to buy them in or is all free cash flow simply going to go to reducing the bank debt?

John, on the pension side, as we’ve said, we will not have any mandatory cash contributions in 2009, we will not have any mandatory -- to the best of our knowledge, at this point, given where our pension fund stands -- in 2010. Obviously 2011 and 2012 depend a lot on what assumptions you make on returns, discount rates, employee population, et cetera, et cetera. Our pension plan I think on a preliminary basis is up about 20% or so for the first nine months of this year. A lot will depend on where the market and we end the year and where interest rates are, because that discount rate obviously can have a fairly significant impact on things as well. With respect to the bonds due in ’11 and in ’12, as you may recall we did extend the maturity of some of those ‘11s and ‘12s, I think about over $250 million of those maturities were extended in to 15s and 16s. Obviously we’ll continue to look at things on a very opportunistic basis and if we saw opportunities to do some things to further move maturities around and it made good economic sense for us, then we would do that. I think we have about $740 million of the ‘11s and ‘12s still due in ’11 and ’12 out of the $1 billion that we started with.

BIO

Q4

Brandon Couillard

Annette Tumolo

Okay. Super. Maybe one for Shannon, any color you can give us on how the new Illumina single-cell partnership rollout is going in terms of customer feedback or demand? And maybe walk us through sort of the economics of that deal through instrument ASPs and kind of maybe instrument pull-through metrics, whatever you can would be helpful.

Brandon, this is Annette. So we just launched the product on February 10 and I have – we've sold some systems so far. I've gotten feedback that the interaction in the field between Bio-Rad and Illumina is going very well and the cooperation and customer-facing co-commercialization teams are going very, very smoothly. So we're pretty optimistic about the outlook for the product for the year.

BLDR

Q3

Matt McCall

Peter Jackson

Sure. Okay. That's fair. And I guess one last one. Peter, in the past, we've talked about some internal working capital initiatives. Working capital is a little better than we thought and lumber is likely going to help that. But what's the way to think about working capital? I know there was a question earlier about the impact of falling lumber and you're going to have a tailwind. But how do we think about it given maybe some of those initiatives on top of falling lumber as we move out into next year?

Yeah. Fair question. I think that the work that we've done around working capital is more a matter of structural discipline and a continuing focus on it to make sure that it never gets out of control, and we're still in that 9% to 10% range. I think that there are some specific examples that I can give you of success stories on a location-by-location basis. The dynamics that I think is challenging for the quarterly metric or for the ongoing metric is the in-month ups and downs, the nature of what we hold for our customers, the nature of how we have product on the ground at different valuations for projects or specific ordering profiles. It's a little bit harder to point to a specific quarter or a trend move, but I do see the benefits of the organization in what we do on a location-by-location basis by that focus. And I'm not quite ready to change our guide on that, but I think it will be part of the tailwind that we see coming to the back end of this year. And as we look at the year-over-year comps for working capital use into 2019, I think we'll see it as well. It's going to be caught up in that deflation number though based on where we are right now.

GCI

Q3

Peter Jacobs

Gracia C. Martore

Good morning. Just a quick question, and that is could you just update us where you are in your financial covenant ratios, please?

Sure. We will close the third quarter at about 3.03 times and our covenant is 3.5 times max, and as we’ve said previously, we had expected that the covenant would peak in the third quarter although interestingly, it’s not too far -- in fact, I think right on top of where it ended the second quarter and in the fourth quarter, we have about $55 million of severance cash expense that we took in the fourth quarter of last year that won't repeat. So we would anticipate that that ratio would be lower as well in the fourth quarter.

HPE

Q4

Steve Milunovich

Steve Milunovich

Thank you. My two questions would be first of all for Tim, can you quantify the impact on gross margin from the higher commodity costs during the year and the NAND you had some issues earlier and you’re just getting enough NAND for storage is that no longer an issue and then second for Meg maybe you could just kind of step back and think about over your tenure at HPE. How your – what you have heard that’s different from customers both in terms of how they think about their investing in technology and also how they view HPE?

Yes, so what I would say is that HPE is a whole lot more relevant to customers and partners then it was. This was an enormous conglomerate and you would go in front of customers he’d be talking PCs Superdome Integrity X servers, Enterprise Services, Software and they weren’t sure what we stood for and it was just way too broad and we were not executing with the right R&D against any of those segments. So now HPE is more relevant they know what we stand for and the core value proposition is the software defined data center on-prem with public cloud like economics. This whole moved to flexible capacity and a pay-per-use model is actually encouraging people to say, do I need to move every workload to the public cloud. And then our new stack offering, our new stack announcement discovered next week, I think it’s going to be a milestone and a cap stone in some ways to the innovation and agenda that’s we’ve driven over the last 6 years. So I’d say that those are the main things, I would also say the speed at which we move this company was a slower company then I would have like to seen 6 years ago, and now we jump on opportunities on problems it’s far more nimble, far more agile and I think you frankly just a better run company than it was 6 years ago.

BGFV

Q2

Steven L. Martin

Barry D. Emerson

Okay. And the share count crept up a little this quarter and you didn't buy any stock back. Can you give me some color on what -- where you expect the share count to be for the next 2 quarters?

I guess, I would -- well, one, I would -- I'd run it out at the higher level. I guess I would just -- at this point, is to anticipate kind of -- I'm doing my modeling, I'm just running out the current quarter out to the balance of the year is what I would just suggest to you. I think changes, up or down, with the -- I wouldn't anticipate any of this from a modeling perspective, but even if there were, they probably wouldn't be significant. What I would say is in the -- we had an increased level of stock option exercise that occurred in the second quarter as we saw our stock price rise and so, that would attribute to the increase in the share count.

EXPE

Q3

Douglas Anmuth

Dara Khosrowshahi

I just wanted to ask about international bookings and in particular, obviously a tougher comp versus the last quarter. But looks like you did see some deceleration there. Can you talk about what you're seeing in Europe in particular and how you think you're doing in terms of share and in particular, on the agency hotel program with Easy Manage?

I'd say in Europe, we're doing well. I think that we can do better. In general, the gross bookings number on a year-on-year basis in Europe came down a bit as we were rolling over the fee cuts that we put through last year. Revenue on an international basis x FX improved on it on kind of a quarter-to-quarter basis mostly because of revenue per room nights getting much better than they did last quarter. So I'd say on an international basis, in general, we're satisfied with our progress. In Europe, we're satisfied with our progress. hotels.com on balance, I think, in Europe is doing better. I think Expedia's performance is okay, and it's something that we expect to get better on a go-forward basis. The Easy Manage properties, we've got around 8,000 of them. We've added around 8,000 of them year-to-date. The concentration of those properties is in secondary and tertiary markets. And in some of those markets, we are seeing ranges of 10% to 20% of our bookings being Easy Manage properties. And we think over time, as we establish those Easy Manage properties, as we move them up in the sort order and the new hotels that we're adding mature in our inventory set, we would expect that the percentage of bookings that come through Easy Manage as a percentage of our total bookings especially in secondary and tertiary markets should get higher than the levels that they are now, which is kind of a 10% to 20% level. So we think that we'll see improvement there, and we're happy with the progress. But we think we can do better.

PM

Q1

Matthew C. Grainger:

Jacek Olczak:

Thanks. So, as we think about the cadence of profit growth and earnings growth this year, clearly we're still in a period of more accelerated rollout costs behind iQOS. I don't know if it's – I may be asking for too much detail here, but can you give us a rough sense for how material the step-up in investment was as a headwind to earnings growth this quarter? Or how it compares to Q4? And you mentioned in the release that the earnings growth profile could be more second-half-weighted than Q4-weighted. So just wondering if you could sort of help set expectations for Q2?

Actually, you're always asking for lot of details, right? Look, let me put it this way, absent the iQOS partially comps but also increased investment, I guess the cost for the quarter would come about flat. Essentially that would be flat. So all the cost growth in the quarter you could – one could attribute it to the investment behind iQOS. It's obviously on ex-currency, always on ex-currency basis. To give a bit more light into how we see the quarters going forward, we still are to confirm that our outlook for the total costs for the year, and this is now all-inclusive again on ex-currency basis or conventional and RRP, Reduced-Risk Products on ex-currency basis, the cost outlook still remains at about 1% for the full year. So we'll have, obviously, some comps issues in the quarters. If you look at the pacing of our growth rate, if I take it on an EPS level, second, third, fourth quarter, look, as much as we would be explaining the difficult comps in the Q1 of this year, I mean, clearly we will all have a different situation, 180 degrees different situations in Q4 of this year. So obviously one should expect there quite a strong, very strong actually growth rate on EPS level in Q4. And in Q2 and in Q3, we will be going somewhere below obviously the guidance which we gave for the full year. This will very much also depend on the timing of some expenses, et cetera. I think revenue line is going be cruising closer to what we said is for the full year, so somewhere in a corridor of a 5% to 6% quarter this year versus the quarters of the last year. We should see the evolutions of our revenue. So it's much more the differences which we have in comps coming from the investment, partially behind the conventional, but very much obviously driven by the deployment of iQOS.

ASEI

Q2

Brian W. Ruttenbur

Charles P. Dougherty

Okay. And then final question for Chuck. On the BOT, do you expect something in the next 12 months, or when? Is there something on the horizon that you can point to?

I mean, there are certainly, Brian, things on the horizon. And as I said, kind of the expectation for success, I would -- I think it's realistic to expect to win in that timeframe.

NMBL

Q3

Brian Alexander

Anup Singh

Yeah. Thanks. To what extent do you think public cloud adoption AWS and the like is having an impact on revenue trends for either your enterprise customers or your commercial customers? And then maybe just a little bit more quantification on the magnitude of investments that you're planning in terms of number of hires, headcount et cetera. I'm just trying to get a sense for the pace of investment and how that's going to change over the next few quarters. Thanks.

Ryan with regard to the investment question and try to quantify that. I think as we have said we're making investments in the business especially in the first half of next year that we believe will reaccelerate our growth in the future. And as I alluded to before, the leverage as a result of those investments in the first half of the year will be negative as compared to this year. We expect to see the leverage improving in the second half of next year as we see the benefits of those investments. The other thing I would say as we look at our overall investments, we are doing is somewhat of a careful assessment of spending in to other areas of the business as we increase our investment in these areas of sales and marketing and the commercial business and then broadening the platform that we have. So we're going to be cautious and looking for leverage in other areas of the business, but we expect our investments to start to pay-off in the second half of next year.

WBA

Q4

George Hill

James Kehoe

Hey good morning guys. Thanks for taking the question. I guess so James, I think one of the things that investors are going to struggle with this morning is it looks like if you back out all the puts and takes, the company's guiding to a 4% to 5% core OP growth in fiscal 2020.I guess can you walk through some of the components of that about maybe a little bit on how the company's thinking about volume growth. And I think particularly reimbursement is going to be a big question in 2020? So I guess from a fundamental perspective is, how are you seeing the business -- kind of what are the building blocks for growth for 2020?

Yes. So that's a good question. So the -- we did call out the operating performance once you take out the headwind coming from the prior year bonus of around 5%. And within that as well, we're also covering 2 percentage point of growth investments, so you're getting closer to a 7%. And then we've removed e-cigarettes, so you could -- actually if you strip out -- these are all the puts and takes, we've laid out on slide 19.So the way I think you should think about this is, we expect relative stability in the wholesale business. So you've seen the very strong performance in the current year. And I'd be calling on a -- something mid-single-digit revenue growth. And then I think as you look at the RPI segment, you'd be looking at probably flat to declining revenue until we see flat line of sight to improve market circumstances in the U.K. And that's the only question mark we have on the segment.And then in the U.S., I think this year the way you should rationalize the U.S. is, this year we had a contribution coming from Rite Aid. If you kind of remove the contribution, I think we're looking forward to pretty strong script growth is our outlook.And then secondly, we see continued recovery in the retail business. So, we had a very strong exit on retail compared with the first half. The same in pharmacy, we saw a strong recovery on scripts second half, first half. We expect to see a continuation of the improved trend. So that would lead to a low single digit revenue in the U.S. business. So I think, if you look at the total company, I think we're looking at something in the low single digit revenue growth maybe 2%, maybe 3%. So take out Rite Aid, this year and you get pretty close to the same kind of number. The way, we thought about reimbursement is we've planned reimbursement slightly higher than the last three-year average, and we expect 2020 to be a continued tough year on reimbursement. And we've planned it relatively conservatively higher than the last three-year average and we're not giving anymore information on that.And then you've seen with the call-up of the cost management program that should give you the confidence that we will have a significant leverage on the cost side to – so a combination of the solid revenue growth, plus generic procurement savings continuing at a similar level plus a cost program that is really ramping up and gaining pace gives us the comfort that we get to this mid-single-digit kind of range, before the bonus impact. And know, I'm love to give you a lot of insights here into how we talk through this. So reimbursement a little bit higher than in the past, but a much stronger cost program to give us the confidence to deliver this base case.

UIS

Q1

Jonathan Tanwanteng

Peter Altabef

Great. Thanks so much for the color. And just regarding your comments on mid-teens growth in the federal market for this year, is that all of the projects and handed in the backlog? And are you really seeing that in Q2 or do you still have to actually win more projects to get to that rate?

Jon, that's a great question too. So, all of our sectors, whether it's federal, public, commercial or U.S. Federal, all have a blend of long-term work and short-term work. And if you go to the investor relations snapshot that we show, you can see - again, I would suggest the non-GAAP, because it's the cleanest. But if you go over there, you'll see that of our total revenues 73% are what we call recurring, 15% are nonrecurring services and 12% are technology, which is really - at this point, the vast majority of that is software licensing. But that 15% nonrecurring is really short-term project. And that short-term project work appears throughout our business, including U.S. Federal. So it'd be wrong to say we have all of that locked and signed, because we do expect and rely on that level of project work. But based on what we've already seen, we would not have given out that mid to upper teens numbers if we didn't have confidence in it. The real fly in that ointment would be if there's some kind of a government shutdown toward the end of the year or whether there are issues with respect to the federal budget. That's not foreseen and it's not in our estimate. But other than that, we feel good about that range of revenue in U.S. Federal. And again, that is all organic.

SMCI

Q3

Michael Bertz

Howard Hideshima

Good afternoon, gentlemen. Just to kind of go back to the gross margin question again, and Howard, maybe you can walk me through a little bit on this and how much the timing impact do you have particularly from hard drive and memory? And I think mainly from hard drives and in that sense, what is the difference between basically passing through the cost if you're selling in those component or something and just how much you guys are having to eat over these different quarters where pricing is moving around? And I mean I understand it's volatile but 350 bps is a significant amount, and it's like – are you buying it in the previous quarter and having to remarket, and you talked about taking some write-downs just because your marketing it at lower cost for market. I mean how much is that impacting? I am assuming most of it is coming in the sub-system business. Is that right, not in the systems business at all?

Well it actually caused in both sides of it, Mike, to the extent that we incorporate the hard disk drives and the memory into our server systems. So any type of price changes and their impact the overall server margin also. So it is not just isolated in the components to sub-system business.

GCI

Q3

Douglas M. Arthur

Victoria Dux Harker

And then the $100 million target?

On your all-access question, and I won't speak for Bob, obviously, but I think at this point, given the fact that we had already generated about $20 million of the bottom line impact even prior to going into this year, we're on a good trajectory relative to this year's year-to-date, I think, we're at this point, very comfortable with the $100 million bottom line impact.

GVP

Q1

Robert Blum

Kyle Loudermilk

Sarah, while we wait to see if there's any additional questions here, Kyle, I just had a couple here. On the software solutions component to the business, can you maybe add a little bit more color there? Maybe what the opportunity is? Size of that opportunity? And what this can mean as -- in terms of the larger picture for GSE going forward?

Sure. Look, when we came into the business in 2015, we saw as part of the deep value this company can offer is packaging and licensing. It's IP in a contemporary fashion to industry to add value to the industry and create an ongoing annuity for GSE. And you look at where we are today, it's very significant SaaS-based revenue increase, 160% year-over-year, this is high value-added, very sticky, 80% to 90% gross margin. And that's really a direct result of the strategy and hard work of the team in working with customers. The growth potential is significant. While I won't put a specific dollar estimate on it, we certainly have the opportunity to go back into clients who have spent millions of dollars on our solutions and convert them into a recurring annuity, and we're working hard at that. The example of the Canadian client that we highlighted is just one example where we've achieved that conversion, but there are many others that we're working with to go through a similar conversion. The value prop is obvious. They don't want to have to support on-prem technology to hardware and software. They'd rather just support it Internet connectivity and a web browser much cheaper for the client, more effective and scalable for us. And it's -- so it's lower cost of ownership to the customer and higher value-added for us, that's very sticky and grows over time so significant opportunity ahead.

TAP

Q3

Bryan Spillane

Stewart Lindening

Stewart, just to follow up on Mark’s question on foreign exchange. In the seat that we’re in the best we can do without knowing whether you’ve done anything to hedge the translation is to just simply do the arithmetic on currency translation against whatever we’re forecasting for currency-neutral profits in the UK and Canada, offsetting it with the natural hedge you have on the interest. If you were doing the arithmetic sitting in our seats, is there something else you would do differently?

I can’t say that I would direct you to do things differently. I can tell you that we’re not really in a position to discuss the specific hedging strategy that we’ve undertaken. You will have to do the calculations as you would normally.

TWI

Q4

Justine Ho

James M. Froisland

Okay. And I guess as a last follow up with that one. If you – when it spikes that quickly in the first half and you’re able to then increase prices in the second half, do you have to give that back when rubber cost go down and then you end up having a permanent loss of that 19 million, or do you kind of --?

Yes, I would point out that that price uptick there at the end of 2016 heading into first quarter we saw 30% or 40% I’d call it a rocket price increase. It shot up like a rocket. Everybody as you said in the industry was surprised. And then it continued in the second quarter. It took a while for the rocket to come down. But it totaled about $19 million that we could not pass on or the industry as far as that goes. As a result, we did strengthen our purchase policy, such things as dollar day averaging going out, et cetera, trying to do what we could within our own four walls to control it. So that helped out in the third and fourth quarter naturally. So that’s what I did. But as Paul said, it’s bad to “more normal.”

TAP

Q3

Todd Duvak

Peter Swinburn

Yes, good afternoon. Had a question for you on I guess your category exposure. Obviously you’re focused on the beer category. Are you interested in getting into other spirits categories or alcoholic beverages categories, like wine, like Foster’s also has?

That’s not in our strategic game plan, Todd, no. That obviously depends on what sort of business we were talking about. But we’re in a very comfortable position at the moment. We’ve got a strong balance sheet, we’re throwing off cash, and anything that we do anywhere will have to be short term agreed to. It will be prudent and it will be in the best interest of our share holders.

CAJPY

Q2

Keith Bachman 

Toshizo Tanaka

Could you talk a little bit about your assumptions for supplies growth for both the printer market as well as the inkjet market – the laser beam, as well as the inkjet market? What your assumptions are for supplies as you look at the second half of the calendar year? And then what was supplies growth within the June quarter? Thank you.

Answering your question for the laser beam printers consumables for the first half, it’s flat in local currency basis. But in the second half, 9% growth and the annual basis is 8% growth in local currency basis. Inkjet printers; first half is (inaudible) second quarter 1% to growth on local currency basis and second half is 8% growth, annual basis is 5%. So same tendency on both laser beam and the inkjet printers. Second quarter – second half, we are expecting the jump from the first – second quarter. So that’s the reason why the production itself come back to the normal, then we can expect that his kind of sales growth in the second half. That completed my answer.

NMBL

Q3

Keith Bachman

Suresh Vasudevan

Okay. How long does a company and the Board pursue this strategy before possibly considering other strategic alternatives? In other words if you -- another couple of quarters margins don't improve and indeed pricing persists which could cause ongoing pressure on the business, how long does the company look at that before deciding perhaps make different strategic choices?

At this point I think we've given you a sense for how we are thinking about our business model which is the investments we make will bring us into the same sort -- will impact our leverage in the first half of this year and the second half will improve our leverage. The reality is that from a cash perspective so far this year, we have essentially generated cash. So this is a business that is not burned cash all through this year. When you look at some of our competitors and you contrast our approach to cash management it's extremely prudent. We are not anywhere close to abandoning the prudent approach to managing cash and so I don't feel like we're taking undue risks. These are well understood investments that we know have a good return. So, I think at this point that is really the outlook on how we want to operate our business model.

CVU

Q3

Kenneth Herbert

I just wanted to first ask on the third quarter on the gross margins, was there anything else besides the $400,000 you called out in unusual expenses associated with WMI that could have been a headwind in the quarter? I'm just trying to get a sense if there was anything else flowing through from legacy CPI or anything else from an execution standpoint we should be thinking about.

Vincent Palazzolo

TAP

Q3

Christine Farkas

Kevin Boyce

Thank you very much. A couple of follow ups if I could. Kevin, first on Canada, you talked about early fourth quarter STRs being unchanged, so that’s a deceleration. Do you think that’s on the back of stronger pricing in Ontario and perhaps Quebec, or are you seeing maybe some trade down impact, either away from or towards other categories? What are you seeing there in the early part of the quarter?

I’d say from an industry perspective, the 3.1 was a pretty heated industry and reflected a couple things. It reflected in Quebec a bit of an inventory build, to be honest, and it also reflected early in the quarter. You may recall last quarter I spoke about the timing of the Canada Day holiday, so adjusting for that I think it’s really the third quarter that’s a little bit inflated rather than the fourth quarter. I characterize October as okay, not bad, not great, but in an industry where historically we’ve been at about 1% growth, flat for us is probably a pretty good performance given all the circumstances in the marketplace right now.

PDLI

Q2

John 

John McLaughlin

I was just wondering if you can provide a little bit more guidance on how much of your balance sheet is committed to deals, and how much cash do you have free for other deals?

So in fact our pre-cash jumps. Obviously, you have to set aside money for dividends which we set a dividend at the beginning of each year. We announced it $0.60 this year. It’s a regular dividend. We'll go through the same process the beginning of next year. We have to think about that. And then if some point in the future as being closer to 2015, we do have some convertible debt that is paid off, so we have to think about that. But in terms of -- unlike a fund, it's not a static number and we do have a fair amount of flexibility beyond those immediate obligations of setting aside some for dividends and the longer term obligation of making sure we can satisfy the convertible debts.

SMCI

Q3

Michael Bertz

Charles Liang

Okay. And then just now go back up to where you've seen the demand come from, I mean and I'm sure some of this is tied, I know you talked a little about the data center being little bit lumpier people waiting and so I get that 40% is a big change quarter to quarter though. As you also look geographically, I mean, U.S. is down 15% and Europe was up a little bit which seems a little bit counterintuitive in a way, Asia I believe being up 34% quarter to quarter, that makes sense. But anything you can attribute to the different shifts you have there both geographically and sort of where end markets of those are coming from?

Yeah, USA is more competitive in the last two quarters. Especially when we have a hard drive high price appraisal. And another fact I believe because our FatTwin– our FatTwin is really remarkable architecture, and we also experienced some customers they're waiting for that. The good thing is that product line is in production now finally. So that we have our performance in this quarter, December quarter.

NWSA

Q2

David F. DeVoe:

Chase Carey:

I think what Rupert said today was, we're investing around $30 million in the first year. We have a run rate of about $500,000 of a week’s cost and breaking obviously will depend on how we do.

I’ve seen that the leverage obviously in this is pretty good okay, in this case probably ups or down of today.

UHS

Q2

Tom Gallucci

Steve Filton

Okay. And then on the behavioral health side, obviously a very good trend there for 18 months or so that were above average is I guess the way we looked at them, which sort of came back down to earth a little bit this quarter. Can you point to anything in particular what they have changed and I guess what is your long-term growth outlook for that business at this stage?

Yeah, I think Tom that we have said a number of times that we think that going forward a reasonable growth rate, revenue growth rate in the behavioral division is probably in the 5%, 5.5% range and we have been pretty consistently meeting those targets. We were a little lower than that in Q2. As we looked at the detail of it I think we identified a number of facilities where because of ongoing either new construction projects or ongoing construction projects to convert residential to acute beds, we had to close down some capacity and we think that cost us maybe 50 or 60 or 70 basis points revenue growth in the second quarter. So I think when adjusted for that I think we feel like again that sort of 5%, 5.5% growth rate is reasonable, and the other piece is that beginning in July of 2012, the severe Medicaid reductions that we saw at this time last year of 3% to 4% moderate to something like flat to down 1% and so that’s a helpful comparison as well.

ODP

Q3

Matthew Fassler:

Michael Newman:

And then secondly, for Mike, when you look at the inventory dynamic, your inventory growth was a bit unfavorable to your sales trends. And that was, I believe, reversal of trends that we had seen, leading up to the certainty versus where we were last quarter. If you could give us a sense as to what contributed to that and kind of where inventory stand and where the inventory lives right now?

Actually, when we talk about flow in the quarter and the contribution to cash flow, we're actually really pleased with the inventory levels. If you look at what's driving flow for the quarter, it's mostly driven by increases in accounts payable from last year. But what didn't happen, with that increasing accounts payable was an increase in inventory. We certainly had great sell through on back-to-school inventory. We had great sell through on overstock, in clearance items and inventory. And we also had some operational changes in the way that we're managing the supply chain on ink and toner that we think are going to be permanent. So I'm actually very pleased from a flow perspective, with the payable in inventory numbers for the quarter, principally for those reasons.

ACAT

Q1

Joe Hovorka

Tim Delmore

Right. And the R&D number, do you have an estimate of what that should be for 2013?

Not a specific one for this call, no.

BLDR

Q2

Mike Dahl

Peter Jackson

My second question is around sticking with the theme on manufactured products. Obviously, the markets had some headwinds in terms of starts and your volume has continued to well outpace that. But it has decelerated over the past quarter. And so, I want to get a sense of just when you think about that 6% on manufactured products volume, you're putting in a lot of investment organically you've bolted on with these couple of plants. How are you thinking about within your guidance potential for reacceleration? Or just what level of growth in volumes should we be thinking about for manufactured products going forward?

Yes, that's a tough forecast. I mean, obviously, you're going to have correlation with starts. We've talked about that single-family starts over the long-term with the best indicator of our underlying demand-. We do think we're taking shares so obviously that's another component and this is part of our ability to do that, because we think the macro trend is coming towards Builders FirstSource as it pertains to our ability to invest in our skill set in that truss manufacturing. Or I would say that maybe the best answer to your question? We're going to continue to invest in this space, because we believe that the growth, there is always going to be better than starts.

NMBL

Q3

Simona Jankowski

Suresh Vasudevan

Hi. Thank you very much. I certainly appreciate some of the tactical issues you highlighted in terms of the focus on commercial versus enterprise and then the competitive backdrop. But just in terms of some of the more strategic decisions around the roadmap. How do you feel about a couple of areas the choice of focusing on fiber channel versus for example, hyper-converged infrastructures which does seem to be gaining traction and then also the timing of the flash products? How you think about that and if you think that will be helpful in giving you another tool to battle some of the industry dynamics?

Yeah Simona, let me start with the second part of your question which is really around the flash, All-Flash product question. As I said before, we absolutely believe that having the broad platform that spans every workload is important. We have also said that we have a very concrete plan for broadening our flash platform to compete in the entire space and that is still very much on target. You’d expect to see us -- you should expect to see us participating in the entire market with both hybrid flash and all-flash market if you will. The second question really around hyper-convergence versus convergence versus standalone storage. We still continue to believe while there is growth in hyper-convergence in certain workloads there is enormous growth in both standalone flash centric storage as well as converged flash centric storage. We still believe we have a very strong platform to address the entire spectrum of flash centric storage requirements and our partnership with Cisco and creating SmartStack converged infrastructure allowing us to participate really well in converged deployment. So, I think the pace at which we're executing are roadmap and the direction of the roadmap very, very strong confidence in where we're headed.

GCI

Q3

Douglas M. Arthur

Gracia C. Martore

Yes, Gracia, a couple of questions on TV and one quick one on all-access. The extra week impact to the newspapers for Q4 is pretty well chronicled. Can you just remind us on TV? The extra week is, I believe, is not quite as significant as a revenue factor for last year. Can you kind of box what that is? Secondly, on TV, I believe you're coming into some pretty important or at least one important retrans negotiation in the fourth quarter. I know you're loathe to talk about that, but any guidance there as to timing and potential impact would be helpful. And then Victoria, you talked all year about the $100 million pretax cumulative benefit from all-access. Are you still on target there to the bottom line, or are you actually ahead?

Well, that's 3 questions, so I'll take the first 2, and then I'll pop the last one over to Victoria. With respect to the 53rd week on television, you're exactly right. The impact was probably in about the $10 million range on total revenues last year for the extra week. And then with respect to -- and for the total company, it was about I think around $60 million and about $0.03 of EPS to frame that extra, extra week when you go back and look at our press release from the fourth quarter of last year. With respect to retrans, we -- as Dave Lougee, who is here with me as well, and I have indicated, we do have one significant deal and one more modest deal coming due, but towards the very end of the quarter, so we don't anticipate anything of consequence in terms of the impact on the fourth quarter. Obviously, we'll have to see how those negotiations go, and then we will be able to give you, once they're completed, some better estimates for our retrans for 2014. But we should see retrans in an absolute basis being roughly comparable to what we posted in the third quarter. And as you recall on the fourth quarter of last year, we had some meaningful transactions that also boosted revenue in the fourth quarter. More likely these will boost revenue in the first quarter and beyond.

BMY

Q1

Dane Leon

Samit Hirawat

Thank you very much for taking the questions. And congratulations on the start to the year. I know it's late in the call, but thank you for taking the questions. And I'll keep this brief. A question we get a lot from investors is how to think about the multiple myeloma franchise over the next couple of years and your market share collectively within that. Obviously, you have some moving pieces with Revlimid with some offsets to the backlog. But the specific question, I guess, is, where is your team looking in terms of some of the new agents that the clinical community is becoming more interested in, such as iberdomide? And how do you think that can move into a commercial setting as an offset to some of the headwinds you may face in the space? Thank you.

Yeah. Thank you. So you've very correctly asked about multiple myeloma strategy. We are leaders in multiple myeloma, of course, continuing to build on the heritage of the image where we've pioneered in that space. We do have the broadest portfolio, and now we are beginning to see the results of that with the approval of Abecma. But the way we look at it is a three-pronged approach. On one side, we have the CELMoDs, which have the potential to allow for us to replace the image over time with a near-term opportunity for iberdomide reading out this year in the fourth line plus setting. And then, the second CELMoD 480 reading out in 2022. The second strategy is the BCMA targeting. Abecma already approved, and we have the investigation ongoing for T-cell engager, as well as the ADC targeting. The third pillar is, of course, the combination. And you will see beginning this year already the studies of CELMoDs in the earlier line setting in the one to two prior lines of therapy. And then, we will continue to build on the other combinations as well. So we feel overall really good about our position by having these multiple modalities. And we are confident that we can continue to build on our leadership position going forward in that space.

EXPE

Q3

Scott Kessler

Dara Khosrowshahi

And if I could just follow up really quickly. Can you give us a sense of what kind of, I don't know, criteria or touchstones you have for those types of acquisitions? You want them to be accretive, you said, over the long term. Does that mean the first full calendar year that the company has integrated? Are you looking for expansion of geographic footprint? I mean, give us a sense of how you think about these really quickly.

Yes, I'd say that there are a couple of factors that we look at. One is to the extent that it allows us to get into the geography that we think will be very difficult for us to get into, and it's also the significant opportunity that's a big positive. So eLong, for example, in China, we didn't think we could get a position in China as strong as eLong through organic growth. And while eLong had a tough time in its first couple of years, it's really turned around behind the new management team. And I'd say we're very happy that we have a position there. So one is large geographies that we don't think we can get proper scale then through typical organic growth, that's one. The second is if there's a new piece of technology or a new product that we think is an attractive product. Example there is Venere in the agency hotel market that we wanted to penetrate in Europe. It got us in there much more quickly. We're expanding that product in Europe as well as certain other areas of the world. And then the third or just kind of our big growth areas, we love media businesses that we can add to the TripAdvisor team. We would love to add some scale to Egencia because we think that's a big and growing opportunity. So those are also opportunities that we'll certainly keep an eye on. Mike, did you want to make a correction on something that you said or...

WBA

Q4

George Hill

James Kehoe

James, that's super helpful. And then I guess my quick follow-up would be it sounds like this cost program we should expect to see a lot of it flow through to the bottom line as opposed to reinvestment, I guess that's the right way to think about that?

Yeah. It's an interesting question and that's why we won't be providing growth savings on the call, because I have a philosophy on this, which is the only thing that matters is what hits the bottom line. And you know, the circumstances of the company and it's – if you think about – if you save on a gross basis you're going to offset your inflation. And for a company this size, you can work it out. It's probably $250 million. And then, if you're growing your scripts at 3%, 4%, 5% that's another $100 million of incremental costs, because you have an incremental cost impact every time you fill in new scripts.So you can be quite easily – before you start the year, you're facing a $400 million headwind. So that's the first part. How do you offset inflation? And how do you offset the impact of volume growth? The second one as you've seen, we've taken a very strong stance on the investments. And I don't want that message to be lost. We're hitting the previously indicated guidance range with substantially higher investments. And that's what the cost program is helping us deliver. So, we quite hopefully put in the magnitude of the investments, we're actually spending this year. And it somewhat gets back to the age of some of the systems we have in the company, where 40% of that investment we have year-on-year is going on new pharmacy systems in the U.S. and U.K. and the implementation of SAP in the U.S. We will be able to take out an enormous amount of inventory over the next three years, as we implement these systems, enormous. So these systems will pay for themselves.The second – the next call it third is on new digital capabilities. And then, the final piece is every time we do a pilot – and the pilots are starting to scale up. We have 60, plus 70 – 67 just on Kroger. It costs quite a bit of money to reorganize the stores and try these pilots. These are all fully funded. So that's – long answer to your short question was the overhead is to pay for inflation. It's the dramatic step-change in the investment profile of the company to drive sustainable long-term growth. That's the business we're in. We have to drive growth longer term, and then finally as part of the business model, where reimbursement is offset by [generic] [ph] procurement, savings, volume and SG&A and cost discipline.

LBRANDS

Q2

Laura A. Champine

Stuart B. Burgdoerfer

This is sort of a big picture question. I understand the issues with expenses for La Senza and the calendar changes, but it sounds like there's a lot for Victoria's Secret, in particular, to be excited about, and you've got great momentum coming out of Q2. Why not increase guidance for the back half today?

Laura, it's Stuart. We work hard internally. As we think about the business and run the business, we found it very important to plan our business conservatively, inventory expenses, et cetera, mindset, and then read, react and chase where there's business to be done. And that mindset, that approach, that thought process, has served us very well, and we'll continue to run the business that way. It's how we've run it the last 4 or 5 years, it's served us very well, and that's how we think about and run the business.

PLXS

Q1

Steven Fox:

Steve Frisch:

Thank you. And then just on the new logo wins, can you just talk about the competitive environment around those six wins? How much of it was, do this just sort of where you guys play versus maybe seeing competition from smaller, large EMS providers?

Yes. The competitive environment is about the same. I mean, we run into the big guys all the time and there’s always smaller players’ involved as well. And so I don’t think with these situations or with COVID, there’s been a big fundamental shift in the competitive landscape. Although, we are seeing a little bit more, I’d say pricing diligence in a little bit discipline, and so that’s refreshing to see.

SYK

Q2

Steven Lichtman

Kevin Lobo

Okay, perfect. And then just secondly here with the worker center in a bulk year, for I think about six months, any update or thoughts on a smart implant coming from that acquisition?

No, nothing new to report at this point. I mean, obviously, it's still fairly new in terms of the acquisition into the organization. We still do believe in smart implants and smart devices and that they will have a role to play in orthopedics. And so as we -- same similar as with robotics, as we get further down that pathway, it's something that we will certainly keep you updated on.

LBRANDS

Q2

Brian J. Tunick

Sharen Jester Turney

So I guess first one for Nick. Maybe outside of the big 3 categories, have you done any research or identified maybe a fourth or fifth big category that you think can drive the BBW business in the future? And then maybe Sharen can talk about the Beauty business. It's been a hot topic. Whether you want to discuss the margin impact for the first half or the product flows for the second half, but maybe just give us an idea of where you think we are in the spectrum from the Beauty business being incremental to Vicky's [ph].

Brian, it's Sharen. In terms of the Beauty question, we still like Beauty. It's just such a natural adjacency to both the Victoria's Secret business, as well as the PINK business. And as we've gone into the fall season, really focusing on going after the Fine Fragrance business with the first Victoria launch, if you haven't seen it you should, and really has been very pleased with the response that we have gotten. As we continue to build in terms of the all-important holiday timeframe, you will see more launches this year versus last year really in -- more of an emphasis on gifting as we're going to the holiday season. And then we also came off of last year repackaging our PINK Beauty business and have seen good results from that effort as well.

NWSA

Q2

Douglas Mitchelson:

Chase Carey:

Is your vision for the next few years at the current cable satellite distribution in ecosystems stays in place when it comes to your live channels?

Yeah, I don’t assume it like, I truly believe the value of that, I understand that we have to take less, the value what they get in that package is fabulous. I think the breadth of what you got there is unique when it covers sort of from sports to news, to entertainment and the like. And I think in American households today live on it, maybe not every 23 year old understand, but I think it is kind of everything to see about it. Any of the noise about the pressures today I think are really economically driven at a tough time when you have people struggling with unemployment rate where it is that have to make in a very difficult and the trade-offs in the day-to-day life, but I think the value for this package and the importance of it, has real legs to it.

DELL

Q3

Benjamin A. Reitzes

David I. Goulden

Can you just talk a little bit about the geographies? Joe, what did you see in Europe? It looks like pre-currency growth was probably like up around 10%. That's still actually pretty good for that environment. And APJ, why was it so good?

Ben, let me just give you a couple of the flavors on currencies. Actually, constant currency was near 12% in Europe, so, again, strong. Well, I just want to give you that data point. Joe, you want to comment on the -- did you have colors?

TGX

Q4

Frank Tarallo

Sure, maybe while you look for that Frank, if I assume I guess a historical gross margin rate for brachytherapy of let's call it 50% you get a sort of a 33% number in Surgical. So I'm wondering A, is that right and B, what should we think about for 2011 and are we going to see a pick up there from the moving of the new facility and if so can you maybe quantify that for us?

Constantine Davides - JMP Securities

Yes, first let me go back, the open orders were $13.6 million at the end of the year. So it is still at a pretty healthy level in our view. On the gross margins I think you calculate - you are looking at the Q4 numbers I think. Yes and so, yes I think 33% is pretty close to what the gross margin was on the surgical side, it's a little bit lower than it was about a year ago. I think you have been following us for a while and you have heard us talk about some of the factors that have affected margins especially in 2010, the changes in customer behavior some of the costs that we had to incur to address, some of that lumpiness and some of those changes the large of needle facility that came online in Q3 that increased some of our cost base. And so I think if I am not mistaken you are probably familiar with what sort of - what happened in 2010, is that correct? Look going forward, I think Chris mentioned in her comments in a few minutes ago that improving profitability in the surgical portion - in the surgical segment of our business is a very high priority for us. We have spent a couple of years investing in infrastructure, investing in capacity and we have spent a lot of money in 2010 especially on the needle facility. So we certainly have those expectations and we are certainly focused on that. I can't forecast for you as to what the margins might be or what we are budgeting, we don't do that kind of forward-looking forecasting. But I can tell you is the picture is a little muddier when you look for - when you are looking forward not only because of what we can control that we feel pretty good we'll get right and fixed going forward, but some of the things we can't control. healthcare reform for example; there is still a lot of rule making to be made and it has got a lot of laws to be written and in fact healthcare reforms is being challenged right up in Washington right now. So there is lot to be written in terms of Healthcare reform. I can tell you that as the results we believe of healthcare reform are health insurance premiums in our businesses - across our businesses have increased just significantly over last year not unlike a lot of other businesses. It is a big number and that obviously has an impact not only on overall profitability but on gross margins as well. Lot of questions about med device tax and nobody is exactly sure how that - if it is going to be implemented how it is going to be implemented many, many of our products on the surgical side are components and they are not finished goods. And so perhaps we are shielded a bit from that or we have yet to see what are the final rules are and in - so forth so I'm sorry to give you such a long-winded answer but it is not sort of - it is not a straight line I guess it is what I am saying. We the message I think is we're not satisfied with the level of profitability in that segment. We have spent time investing in the infrastructure and getting ready to be able to support continued growth and now we want to focus on the profitability going forward.

PM

Q1

Michael Lavery:

Jacek Olczak:

Okay. That's helpful. And we've seen Gudang Garam take pretty aggressive pricing in late in the fourth quarter but then you're still seeing your share under some pressure in this quarter. And you've specifically mentioned some machine-made discounting. What's the pricing environment look like? Is it other competitors that are putting pressure on or were there price increases not maybe broad enough? Or can you just dissect a little bit some of your share moves and what you expect over the course of the rest of the year?

Sure. I think everyone is – we don't see anything abnormal in the speed or frequency, if you like, of the pricing being taken in Indonesia. Obviously, with some positive adjustments due to the size of the – or relatively higher size of excise passed on – they'll pass on, which our industry was confronted this year. So I think as an industry, if I follow what the competition price moves are there, there's nothing really abnormal taking there. Obviously the prices are going a little bit higher due to this, as I mentioned, as a higher pass-on to be passed to consumers. Now the four extra stick price segment, of some four-stick discounting which has happened there, that segment of extra four sticks in the pipe which was sold at the price of the competitor's product with the four sticks less was therefore some time, I think, until the relatively late – okay, let's say maybe second half of the last year, the segment was at about 3% to 4% if I am not mistaken, size of the total market. So it is a segment that's not very sizable segment. We have our more sizable segments in the market. This accelerated I think due to some offerings or introductions from some competitors. We're not very active in that segment. I think our recent, the most recent reading of the size of the segment is somewhere in the range of 9%, maybe slightly above 9%. So it's growing. It accelerated the growth recently. I think in that environment when the consumer is confronted with the frequent price increases and maybe of a slightly higher nature than in the past, clearly some form of a price also discounting, I mean, it might be attractive to some consumers. So that puts obviously especially if you look into the quarterly shares, the monthly shares, they put a pressure on some of our propositions in the market. But – and I mean, overall I would think it's like a manageable situation.

BGS

Q2

Farha Aslam

David Wenner

Sure. And two quick follow-up questions, the first one is around your warehousing and distribution. This is the second quarter we heard that. If you have to kind of put a benchmark of when you think it will be complete kind of what percentage of the way is the business fixed -- implemented, in your mind?

It’s the second quarter you've heard that, because it has been an ongoing issue since we did the flurry of the snack acquisitions in 2013. So it certainly had an impact in the first quarter and the second quarter. Part of the solution on the warehousing side is to get to larger facilities that can accommodate the added volume. We have already accomplished that with our Houston warehouse and we are sorting through the last of that move, and Tennessee will happen this fall and we will have done the two warehouses that really need that extra space. So I expect to start seeing cost improvement in Houston very shortly as they settle down, and then Tennessee will come towards the end of the year. On the distribution side, it's an ongoing process. As I said, we are really trying to move a decent amount of the snack volume to direct shipments out of co-packers, that will help us tremendously in distribution and warehousing and we needed to just get more efficient in terms of negotiating with our carriers as well. I mean, part of our added costs is inescapable and that its rate increases the carriers have put in place. As little we can do about that in a lot of cases. But there is probably 60% to 75% of the increases we are seeing that we can manage down and are doing that now. I think you will see gradual improvement as the rest of the year goes on.

RAIL

Q4

Michael W. Gallo:

Joseph E. McNeely:

All right, and I understand that, but in just general. And then I guess the second part on Clinton?

Sure. So the Clinton facility as we look at the sort of the drag in 2013, it’s a very small facility, top-line was about $2 million, the operating loss was slightly less than $1 million in 2013. So again we see that going away, the facility has held for sale and it has been written down as and a big part of the charge at year-end was an impairment or a write-down of the facility to book value. So, and sort of that’s a release during 2014.

POWL

Q4

Brent Thielman D.A. Davidson:

Don Madison:

One more, if I may. Were there any particular project closeout benefits during the quarter? Somewhat similar to what you saw in Q3?

Nothing in the same magnitude as Q3.

TAP

Q3

Camille Gaduaralla

Peter Swinburn

Hi, thank you. Could you give us a little more detail on the Vancouver Brewery, how your progress is, and when you expect it to be 100% up and running. Then, what type of savings can we see coming out of that?

It’s up and running now. We’re running the line in and the line is fully installed, and the savings are primarily going to be in the area - in the short term, at least - of reduced transportation from our Toronto Brewery. So you should begin seeing that very soon.

UIS

Q1

Jonathan Tanwanteng

Mike Thomson

My first question is what when can we see the margins of the large products that you've taken on start to normalize and start to be accretive instead of to dilutive to your Service margin profile?

Yeah, no, I think you hit it spot on, Peter. It's really a matter of time and it's contract specific. And some implementations are more complex than others and the size of each deal has an impact on that as well. So as we noted in our prepared remarks that we think that we'll see some modest recovery throughout the year, in expansion of our margin. But I think the timeframes that Peter alluded to are spot on.

HY

Q4

Mike Shlisky

Christina Kmetko

Yeah. I think that is great color guys. I appreciate it. Good luck.

Mike, before we get away from you, I just want to -- for the benefit for everybody on the call. The reason we did not back out the $19.8 million from the EBITDA count, is because EBITDA tends to be a calculation to take you back to your cash earnings of the business and get rid of the non-cash items, and we will receive that $19.8 million as a dividend in the first quarter.

BLDR

Q3

Trey H. Grooms

Peter Jackson

I just have a few kind of last-minute ones here, and thanks for squeezing me in. So, one is, I know you've touched on it a couple of different times on this call and, Peter, I know you just mentioned SG&A. You kind of reiterated that, I think, on the 70% variable component. Does that still hold true if we kind of fast forward into next year and you continue to add to the sales force kind of at the pace that you've done in 2018? It sounds like you're going to continue on with that next year as well. Does that same mix still hold true there?

Yeah. I don't think there's a material change.

BIO

Q4

Dan Leonard

Norman D. Schwartz:

Great. Thank you. And I also appreciate all the detail in the prepared remarks, so thanks for that. My first question, on the path to, Norman, as you said, mid-teens or higher operating margin, could you give us at least in broad brush strokes more detail on the components and the timing? Because if you assume mid-teens operating margin on your 2016 revenue base, that is $165 million in additional operating profit. I'm just trying to track down where all that would come from.

So I think it comes from a couple of places. Certainly, the sales growth, and I think as John said, we set the course for sales growth not only for 2017 but for the next few years. And that's, of course, one of the principal drivers. And then, as we go down the balance sheet, I think as we've called out a number of times, our SG&A is on the high side compared to our peers, and we really circled in on very tight control over SG&A for the next few years to help drive those margins. So, as we go forward and see, and are planning now and working on how we harvest the benefits of the SAP system, and some of these other investments that we've made, I think that's really where it all comes from.

AXGN

Q2

Raj Denhoy

Pete Mariani

I wonder if I could maybe drill into this issue with the distributors a little bit more. You mentioned that that there was distractions, and I'm sure you got question as to what exactly that was that caused underperformance in that segment of your salesforce? So, was anything more you can give us just to give a little comfort that this is temporary and that you've put it behind you?

I don't think there was one cause. I think it's the things that are going to happen in a sales organization, especially with independent agencies and that they can get focused on other price. We're not the primary thing in really any of their bags. And so they're providing our product as a service to the people that they -- and surgeons that they already know. So, it was only a targeted few of them that had the distractions, but -- and it wasn't all one thing. So, it really is just digging in and solving that problem. And as I said in some cases, it was something that we felt that the independent agency still has a strong value to us and is committed to the line and we're providing additional resources to get them through that. In that case with some people in their team, so we wanted to make sure that we could provide them training and help them come up the learning curve. In other cases, we dug in a little bit and decided that they had enough focus in other products that we weren't going to get the attention that we needed. And we traded them out and put in a direct rep in either all or part of their part of their territory.

GERN

Q3

Unknown Shareholder

John A. Scarlett

Well, again, that goes back to my original point. When you're talking 10-Q, you're talking as per SEC regulations, et cetera, and, if I may, isn't there some way, shape or form that this could be boiled down to simple layman's terms?

Yes, I appreciate your point of view. This is something that is particular to being a public company. And we have to provide disclosure on the same basis to everybody at the same time. We haven't given any more disclosure on the ViaGen situation and sorry we can't go into any further detail here. But you will see some further discussion of it in the 10-Q, and the 10-Q will be available at sec.gov.

SPTN

Q4

Shane Higgins

Dennis Eidson

Just looking at the retail EBITDA margins year-over-year, and I know they’re not exactly comparable, I see that they’re up about 20 basis points, was this primarily due to the merger synergies and the store closures?

It was a little bit of both and it was also probably a little bit of how we’re working the segment numbers. When you look at how we’ve treated the profitability of retail in the past we had it pretty much as a standalone entity where we treated distribution as a full profit center. This year, and we’ve adjusted the history last year so it’s not much of a factor, we’ve kind of changed that now to where we put a lot of the profitability into the retail segment versus the distribution segment and so we’ve equaled that out. That shouldn’t change a lot year-over-year, but just so you have a better understanding how we’re doing it. I think the store closures certainly helped that EBITDA margin as well.

SWN

Q3

Brian Lively

Steven L. Mueller

I guess I was confused. I had thought that you guys were going to be at 300 -- that you were going to be kind of more contained through 2013, but it sounds like you're actually going to be...

Let me jump in. Again, if you look at our previous spreadsheet that we gave everyone, there was a step where early in 2013, we jumped about 320 million -- a little over 320 million a day. And then we had a flat period all the way until November where that’s re-jumped up to 500 million. Today, that number at the end of third quarter, 380 million. At the end of the second quarter, it's 435 million, and that's 542 million at the end of the year. So we smoothed that out. So Brad will be happy to send you that and you can see how that looks.

HAE

Q4

Jim Sidoti

Chris Lindop

And then can you just give us guidance on what you expect for the donor business outside the U.S. for fiscal 15? Specifically the platelet business?

Yes. The platelet business will grow next year. We don't guide purposely, Jim, to individual product categories but the groups. The growth driver there will be first of all associated with the emerging markets, in fact, primarily associated with emerging markets.

ANET

Q1

Ryan Koontz

Jayshree Ullal

Great. Thanks. I asked about the service provider segment in somewhat of a laggard. And are there any kind of new strategies or products that you guys are rolling out? Or is there a different sales motion that you think going to invigorate that segment? Thank you.

Yes. No, thank you for that. We have been marching towards more and more product capability. In fact, we just introduced EOS software release 4.20.4, very targeted towards cloud grade routing and service provider paring use cases with a single EVPN control plane and segment routing and MPLs on the data plane, just a chalk full of features, BGP, flow aware, transport label, NPLS, segment routing, traffic engineering.What I can tell you is we're getting richer and richer in our product capability. But what I can also tell you is service providers take time to operationalize these things in their network. We are doing okay in our already existing service provider customers, and we are starting to win some small Tier 2 and Tier 3 ones, small ones, but too early to call and too early to say much more about it.

AAPL

Q2

David Bailey

Peter Oppenheimer

Great, thank you very much. I was wondering if you have any information on the percentage of customers that upgraded their iTunes music library now that you’ve launched the DRM free feature. And if you can give us some idea what the revenue from that might have been.

Dave, it’s just been a couple of weeks. So I think it’s – I think it’s sort of too soon to tell in and I don’t have anything sort of specific on that. The March quarter was very strong for us on the iTunes Store. We saw very, very strong growth in music, video, and of course applications.

SANM

Q4

Bob Eulau

Hi, Jure. Hey, Bob, maybe talk a little bit more about the source of the gross margin upside in the quarter. Revenue is at the low end of the range, but gross margin was up 60 basis points and almost a 40% incremental margin. Looks like the components revenue was only up about 5% sequentially. So just talk about how much of the gross margin expansion came from components, improving profitability versus the core business, and maybe some mix factors that drove it.

Yeah. Okay. And thanks, Brian. So first of all, I’d go back to Q3 and say that was the biggest anomaly. If you look at this year, our overall gross margin’s been in the 7.3% to 7.4% range other than Q3. And you’ll recall, in Q3 we got hit by some FX issues as well as a particularly bad mix of business in the third quarter. So, part of your question is comparing to a fairly weak base period. Now, with respect to your question on components, the way we’ve historically defined components, the gross profit was definitely up and was pretty good – not as good as it was in the second half of last year, but starting to recover. Revenue, again in the historical definition, was up as well, and in our new definition as well with the Components, Products & Services. So I think, as Jure I think mentioned, mix was positive, and we’re comparing, particularly with Q3, to a weak base period.

PTEC

Q1

Eric Martinuzzi - Craig-Hallum

Woody Hobbs

Okay and one last question on the ASUS relationship. It’s NoteBooks and its HyperSpace; ASUS is one of the fastest growing notebook vendors because of their Netbook business. Do you guys have a footprint on either the BIOS or the HyperSpace on the Netbook side of ASUS?

Well, we will have in the future; we don’t have it right now.

AMD

Q4

Stacy Rasgon

Lisa Su

OK. Wouldn't you get that just from the nature of the ramp that we saw in 2019, we'll be doing the compare already? I guess that's why I'm trying to sort of normalize second half to second half? I think we get strong double digits in second half versus second half growth across all the businesses?

I would say, in aggregate, you will see. So let me help you this way. So, what we said in 2019 is, 2019, overall, we grew 4%. On an annual basis, but, excluding semi-custom, we grew over 20% through all the rest of the businesses. If I do that same type of calculation, excluding semi-custom for 2020, we would still say the rest of the businesses would grow greater than 20%.

BLDR

Q2

Mike Dahl

Peter Jackson

Thanks for taking my questions. Nice job of getting a lot of cross currents right now. My first question, I just wanted to get a little more detail on the acquisitions if we could. Can you give us a sense for from a revenue and EBITDA or margin standpoint, how we should think about contribution both for the second half and on a run rate basis?

It's pretty modest acquisition. I'm not sure that you're going to be able to decipher it out into details. Truss facilities we've talked quite a bit about what an incremental value would be provided by a truss facility and that will question about how we allocate capital. We feel pretty good about our ability to balance between debt pay down, stock repurchases and M&A. But I think it's fair to say that we're only buying when we think we're getting a good deal. We think it's a deal that makes sense for us. And, that $43 million represents a relatively modest investment for the three class, they're already up and running in a market where we haven't heard before.

TGX

Q4

Frank Tarallo

Okay. And then maybe just one or two follow ups on Core. I think that color on your previous terminations is pretty helpful around that 85% number. I guess my question, is this that a fairly near term expectation or did that take six to eight quarters to get that 85% retention rate? And when you do get is it sort of an even split between direct and alternate - and alternate distributor?

Constantine Davides - JMP Securities

Yes, it is clearly is not a - to six to eight quarter period of time. It is going to be a fairly short period of time. There will be some noise in the very short term the happening as we - during this last couple of weeks and these next few weeks. But we should have a pretty good idea in one maybe two quarters at the most Constantine, of knowing where we are going to end up there. So it is not going to be a lengthy period of time at all nor was it is in the past. As far as the channel, that's a little difficult to predict. Our objective is to retain the volume and we - as you know we have multiple channels direct as well as several distributors and each TheraSeed user is a unique case in terms of how that customer may be accessing the product for example; is it through a purchasing organization and if it is through a GPO purchasing organization perhaps there are only one or two of our channels that we can supply through. And that may or may not be direct and so there is a lot of iterations there and it is difficult to predict. At the end of the day we are focused on retaining the volume almost regardless of the Channel.

AMSWA

Q4

Kevin Liu

Michael Edenfield

Got it. And just how would you kind of compare the demand right now as kind of the lower-end versus the higher-end enterprises? Are you seeing the Demand Management platform start to rebound a bit here and whereas most of that strength is on the high-end large enterprises?

The way it's working out, and [indiscernible] this is, Demand Management, while they compete for perpetual deals and win them, it's more of a midmarket type thing. But what they are really positioned well for is SaaS in the small and medium space. They've got a great platform on Azure. It's a one-click update, multi-tenant. And so their license fees aren't as big as usual but they have and they're going to end up I think eventually having much more SaaS than perpetual. And on the high end, we can do some very big SaaS deals and we already have some nice SaaS deals, but most of the deals want to be perpetual so far with cloud services where we will maintain the system for them. So it's SaaS but it's not a multi-tenant SaaS. It's private SaaS.

TGX

Q4

Brett Rice - Janney Montgomery Scott

Just the follow up from JPM Securities, Constantine. He asked you a very good question and I wish we had little bit of a better answer on what kind of gross margin improvement - are we looking for with the new plant? I will stipulate - there are things you can't control but when you made the capital budgeting decision to invest in the new facility. Isn't there some range that you're looking for so that we - you can monitor whether you are hitting the target?

You are absolutely correct. Here is the wrestling match and I think - let me try to say it the same way or maybe put it little differently than Frank. These are growth companies that historically - they will grow in at double digits - let me give you an example. This does not apply to NeedleTech specifically but let's say we have got surgical products business, you buy it in at $9 million in revenue. There are flying over $20 million and they are doing this in a very short period of time. Yes, we do expect economies of scale from these but at the same time we are layering your bureaucracy and controls on top of them because of our regulatory environment both devices and also with our need for financial control. And so we are only a couple of months into paying in the electric bill up there in a very unusual - in a very unusual nasty cold winter. So I agree with you, how about if I say going forward Frank and I look for an opportunity to if nothing else, look for the ranges and Brett I'm sorry to confuse that one more point. The NeedleTech line primarily components, they are going to have low margins than the finished goods. And so the lumping everything into one easy range is going to be a little bit on difficult side. So I can't answer your question specifically, I can give you the uncertainty around trying to find a specific number for you. But on a go forward basis you have made suggestions to us in the past about things like helping you understand, how did we really performed against special items etc. you have made us suggestions and we will take this one too.

MPC

Q3

Ryan Todd

Gary R. Heminger

Okay. Thanks. And Bakken diffs, any thoughts on how those sustain going forward?

And, Ryan, maybe the important point to be made is that the system that we operate has got so much flexibility and optionality that as – if those differentials open up, we'll run more and have got lots of options with regard to our crude system. So that's – I mean, I think that's probably the point where you want to focus is that we've got the flexibility and optionality every day to sort of identify those best sources of crude for our system, and we'll take action appropriately.

FOSL

Q1

Dana Lauren Telsey

Kosta N. Kartsotis

And then on as you think about the percentage of the business becoming wearables over time, how do you see that?

And I would just add, too, our mission here is to get to a net growth business in watches in total, which is traditional and wearables, and that the margin profile in wearables, even for display, although lower on a percent basis, it's a much higher average unit retail. So, your gross margin dollars per unit are actually equal to or higher than traditional watch here in the not too distant future. So, we're not as concerned about a unit shift.

PLXS

Q1

Jim Ricchiuti:

Todd Kelsey:

Hi, thank you. Good morning. A couple of questions, I was wondering if you might be able to expand on the six new logos you added, if there’s any color you can provide, either on verticals or type of customer or program.

Yes. So Jim, this is Todd. I’ll get us started and I’ll have Steve provide some of the details around the sectors in the opportunities. But the one thing I wanted to highlight about the new program wins that I think is significant. And I hope that people take away from this is, if you look at our business development approach, it’s really to grow with existing customers to find the right customers and then grow with those customers and I talked about six new logos and Steve talked about 14 new relationships. So that includes the six logos plus eight new divisions of existing logo. So, when you look at this, we get a new logo in, we transition it, we potentially add additional divisions and we grow with each of those, the original division or logo, as well as the expanded relationship that we have with the other division. So, I wanted to point that out and then I want to turn it over to Steve to get into a bit more detail.