Good day, ladies and gentlemen, and welcome to The ADT Corp. Fourth Quarter 2015 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference call is being recorded. I would now turn the call over to your host Tim Perrott. Please go ahead.

Thank you, Stephanie, and good morning and thank you for joining us for our call to discuss ADT's fourth quarter and full year results for fiscal year 2015. With me on the call today are Naren Gursahaney, ADT's CEO, and Mike Geltzeiler, ADT's CFO. Let me begin by reminding everyone that the discussion today contains certain forward-looking statements about the company's future performance, which are subject to the risks and uncertainties and speak only as of today. Factors that could cause actual results to differ from these forward-looking statements are set forth within today's earnings release, which is furnished to the SEC in an 8-K report, and in our Form 10-K for the year ended September 25, 2015, which we expect to file with the SEC later this week. In our fourth quarter and full year 2015 earnings release and slides which are now posted on our website at adt.com and on our Investor Relations app, we have provided a reconciliation of the company's non-GAAP financial measures to GAAP. We urge you to review that information in conjunction with today's call. For those of you following us on the webcast, we will be using this slide deck to supplement our commentary this morning. Please note that unless otherwise mentioned, references to our operating results exclude special items and these metrics are non-GAAP financial measures. Now, I'd like to turn the call over to Naren. Naren? Naren K. Gursahaney - President, Chief Executive Officer & Director: Thanks, Tim and good morning everyone. Thank you for joining our call today. We hope you had a chance to review our previously issued earning press release that highlights our results for the fourth quarter and our full fiscal year 2015. This morning, I will discuss our key performance highlights and accomplishments for the quarter…

Our first question comes Jason Bazinet with Citi. Your line is open.

Thanks. Just a question for Mr. Geltzeiler. I know that you touched on it in the prepared remarks, but maybe you could circle back to it. I think a number of investors want to take your revenue guidance for 2016 and just remove 2% from that based on the extra week. Can you just go over again why this won't affect – this change won't affect your revenue materially for fiscal 2016? Thanks. Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: Yes. Really, the only effect that this extra week will have on our revenues is for nonrecurring revenue which, as you know, is miniscule. We are $64 million for the quarter. So, nonrecurring revenue is revenue we record every day, you have seven more days realized nonrecurring revenue. So, that is the only impact. The reason it will not affect regular revenue is and the best way to kind of describe that is describe it on a monthly basis. If the month of February, a customer pays $45 for their services, when there's 28 days in that month or 30 days to 31, we charge a monthly fee. We don't charge a per-day fee. So, we are charging customers that are going to pay one-twelfth of or they're going to pay their annual amount divided by 12. So, recurring revenue has been – is not affected by this extra week. We still will have the same amount of months as we had last year. So, really only affects – and that is true with a lot of our fixed costs and our salaries aren't affected either. It's really the hourly costs and it's the strict variable costs like marketing, as well as nonrecurring revenue. So, revenues are not affected by this. A customer will still pay 12 times their monthly amount and will be booking a year's worth, regardless of how many days are in the month.

Okay. And then unrelated to the accounting change you mentioned a couple of times on the call that you do expect a step-up in nonrecurring revenue growth as you move into small business. Can you just frame that for us in terms of how we should think about how much the number could move, in other words what would you...? Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: It's not significant, I mean, there's two things that happened. In the last year or two, we've been moving away from some nonrecurring activities like selling DVRs and we're moving more to hosted products that's sort of – well, that's recurring. I think that now would no longer be a year-over-year effect, so we'll not have the negative effect of that transition. As we start to move more aggressively into the commercial business, the biggest area of non-recurring revenue is the installation revenues you get from making this out and that is a bigger portion of the commercial business than it is in traditional resi business.

Got it. Okay. Thank you. Naren K. Gursahaney - President, Chief Executive Officer & Director: But as Mike said, that's a relatively small piece of our business today, but it should be growing in 2016.

Understood. Thank you.

Our next question comes from Ian Zaffino with Oppenheimer. Your line is open. Ian A. Zaffino - Oppenheimer & Co., Inc. (Broker): Hi. Great. Thank you very much. On slide 18, you talked about the subscriber base increasing from 2015 levels. Is that inclusive of commercial or any of the other initiatives or is that in the core business? Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: That's reflective of all of our businesses, our total customer account which includes all the pieces. Ian A. Zaffino - Oppenheimer & Co., Inc. (Broker): Okay. So, the core base may or may not be higher than it was in 2015? I just want to understand that. Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: Yeah. I'd say again, it's consistent with the way we reported in the past. Our 6.6 million customers includes U.S. resi, U.S. business, Canada and health. So, it's going to be – it will be apples-to-apples in 2016. Naren K. Gursahaney - President, Chief Executive Officer & Director: I mean, to put in perspective, we have about 1,000 commercial or high-paying customers. But the numbers don't materially move. The numbers, we have about 1,000 commercial customers now. Ian A. Zaffino - Oppenheimer & Co., Inc. (Broker): Okay. I just want to make sure it's apples-to-apples. Okay. Which it seems like it is. And then so, would that also then include any type of acquisitions or is that going to be organic? Naren K. Gursahaney - President, Chief Executive Officer & Director: Again, I think what Mike said in his comments is we always do "small tuck-in" kind of acquisitions, so if there are small tuck-ins or bulk account purchases, those would be included. We treat those the same as the accounts we…

Our next question comes from Jeffrey Kessler with Imperial Capital. Your line is open.

Thank you. I have a couple questions. First, you've been talking pretty openly about bringing on the right type of customer. And the fear was that bringing on the right type of customer was going to cut down on your gross adds and it probably has in some way. Can you talk about beyond FICO scores what are the things you are doing to bring – what is the right type of customer? And what are the factors that you use and what is the effect of that right type of customer beyond just better attrition? What are the other things that you are getting from it? Naren K. Gursahaney - President, Chief Executive Officer & Director: Yeah. Jeff, I think – and I don't want to kind of share all of our secrets on what we're trying to do to drive group quality because I don't want to give the competitors necessarily our playbook. Clearly, credit quality, it was the up-front piece. That's the piece we'd drive. But I think we've talked in the past as to what are the characteristics of a customer that deeply – that lead to higher engagement and, hence, longer retention. And some of the things we've talked about in the past are the products they buy. We talked about the fact that ADT Pulse automation customers have higher retention. So, clearly, we want to be pursuing more customers who are inclined to buy Pulse and Pulse automation specifically. Now, we've indicated that those who buy life safety solutions versus just intrusion solutions tend to be stickier. How they pay, again, and I think we've been very good at this, but making sure that we get credit card or ACH payments. And then I'd say the final thing that we continue to look at is how much the customer invests up-front. Their level of engagement is driven by the investment that they make up-front. So, it's a variety of parameters. I think our analytics are much better than they were two years ago, three years ago. We have a much better understanding of what are the ideal and optimal characteristics, and we're gearing our sales force into pursuing those kinds – not just those kinds of customers, but those kinds of sales characteristics.

Okay. Thank you. Secondly, can you just go through what was the reason for the fall in the take rate in a small, medium business on Pulse? Naren K. Gursahaney - President, Chief Executive Officer & Director: Yeah. Similar to what we're driving on the residential side, we are steering our business customers – our small business customers to more automations, more higher value-added services like the hosted video that Mike talked about, like analytics. Today, many of those solutions are not yet integrated into Pulse. They are stand-alone solutions. So, we don't count them in our Pulse numbers, although they still are automation or higher value-added services. Over time, we will be integrating more of those into our Pulse platform, but...

I get it. Okay. Yeah. Naren K. Gursahaney - President, Chief Executive Officer & Director: ...but they stand separately. They still have similar types of characteristics.

All right. And can you – finally, I want to talk – just talk about two things that you touched on today, but maybe you can get into it a little bit further. Number one, the change in the nature of what you're selling in health and how you view the health market for both your products and your services over the next couple of years as the form factors change. And number two, please talk a little bit – give us a little bit more about Canada, given that the economy is not that great up there. How is the integration going? How is the management integrating with the rest of the people? How's the culture changing and likewise? Naren K. Gursahaney - President, Chief Executive Officer & Director: So, on the health side, I'd say, Jeff, it's changed both in the product over the past two years, but then also, the distribution channels for the product. As you're probably aware, you go back two years ago, we simply had a landline-based, in-home solution. We supplemented that with a cellular product that allowed us to at least serve customers who didn't have a landline. And then in February of this year, we introduced the mobile PERS solution that isn't even necessarily tied to a home that's got GPS in it, so you can use it on the go. Similarly, both for our wireless product and our mobile product, we added fall detection. So, if you fall, you don't have to reach out and hit the button to call our monitoring center. Our monitoring center – the product detects that, and our monitoring center will call the individual or reach out through that pendant or that bracelet. So, we have changed and added the products, and those make up more than 50% of our sales these days. And we're seeing good take rates on the fall detection as well. From a channel perspective, it is more looking at bulk sales, looking at nursing homes or other organizations that may have a large versus a traditional residential model, where you're looking at individual consumers. We're continuing to sell to individual consumers, but we're also looking at more of those bigger account opportunities. And we've retooled the sales force, brought in a new sales leader to pursue those kinds of opportunities. We expect to see continued acceleration there. And we're also working with retailers to see if there's an opportunity to sell either in the store or more likely, via their websites, and we've used e-commerce sales on our own platform.

So, retailers, payers and perhaps providers will be a larger and larger part of the Pulse offering? Naren K. Gursahaney - President, Chief Executive Officer & Director: Of the health offering not the Pulse...

On the health. Well, I'm sorry. I'm sorry. The health offering. Naren K. Gursahaney - President, Chief Executive Officer & Director: Absolutely.

Okay. Naren K. Gursahaney - President, Chief Executive Officer & Director: And from a Canada perspective, again, I'm pleased with the progress. We've brought in Andrea Martin at the beginning of this calendar year. Andrea has put together a really strong leadership team, leveraging some great talent from Protectron, leveraging some talent from ADT. We actually took a sales leader out of the U.S. and moved him up there. We've also brought in some great talent from externally, including some people who had – from some pretty big name companies with strong recurring revenue experience. I think we're starting to see the momentum build there. I think the employee engagement is improving pretty significantly. We've retooled the dealer program, and Andrea and her team had their Dealer Conference a few weeks ago. And the feedback from the dealers were they're very pleased with the changes we're making in the program. So, all the indicators are very positive. We're sharing best practices between the business, and I think you'll see momentum in 2016. And I think that will accelerate in 2017 and beyond.

Okay. Thank you. Naren K. Gursahaney - President, Chief Executive Officer & Director: Great. Thanks, Jeff.

Our next question comes from Shlomo Rosenbaum with Stifel. Your line is open. Adam Parrington - Stifel, Nicolaus & Co., Inc.: This is Adam Parrington in for Shlomo. Why did the subscriber base decline by about 31,000 subscribers sequentially? I mean, gross additions were roughly flat year-on-year. Attrition was better. Re-sales were up 21% year-on-year, but the base still declined. I was curious if you can provide any color on that. Naren K. Gursahaney - President, Chief Executive Officer & Director: Yeah. I mean, I guess the simple answer, Adam, is we lost more customers than we gained. Although from a – but when you look at the year-over-year improvements, attrition improved pretty dramatically. And when you look at – and gross adds were about flat with last year. So, yeah, the simple math is that we lost more than we gained. At the same time, we're making good progress on both of those. Those metrics continue to converge. When you look at for the year, our net losses were down about 50% on a year-over-year basis. So, we feel like we're building momentum for that crossover point, and we're continuing to target getting to gross – or, excuse me, net add positive in the foreseeable future. Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: I mean, I could add to that as well. We indicated that third and fourth quarter were the hardest quarters, fourth quarter in particular is where you have the highest amount of relocations because of the summer months. But as we talk about quality growth and things, I mean, we started to implement not only the – fully implement the 10-year screening which we've talked about, but also some of the customer changes emanating from the data analytic reviews that Naren mentioned…

Our next question comes from Ronnie Weiss with Credit Suisse. Your line is open. Ronnie Weiss - Credit Suisse Securities (USA) LLC (Broker): Hey. Good morning, guys. Naren K. Gursahaney - President, Chief Executive Officer & Director: Good morning. Ronnie Weiss - Credit Suisse Securities (USA) LLC (Broker): Just want to touch on kind of the M&A pipeline. Just kind of what you're seeing out there and if it's not as robust as it has been in the past, should we expect more share repurchases going into 2016 over 2015? Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: Yeah. I'll talk about that. I mean, the pipeline is interesting. We're seeing that there is a decent amount of consolidation interest, people who are – that's in the markets. But I think there's still pretty high expectation for. One of the reasons we have – again, everything with us is remaining disciplined. So, we look at a lot of things. As you can see this year we have not done much in the way of consolidation and tuck unders because the pricing needs to be right. There's been a couple of transactions in the space. And a lot of the businesses or people would say, if I can get to this price, I'll sell; if I can't, I won't. And so, I think we have a pretty good pipeline of business that we're interested in. And we think it is an opportunity for us, for sure. But again, as we said, it needs to be at the right price. To us, some of these things we're looking at because of small- to medium-size opportunities it's just really a third way to acquire customers. Some are even asset deals. They're not even business acquisitions. We are mostly buying accounts…

Great. And Stephanie, we're going to take questions from two more people. And if we can, let's just keep it to one question a piece if possible so we can get the last two one in.

Certainly. Our next question comes from Jeffrey Sprague with Vertical Research. Your line is open.

Thank you. Good morning. Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: Good morning.

I guess I will keep it to one just multipart question. I was just actually hoping to get a little bit more color on some of the underlying dynamics within Pulse. Kind of bringing the year to a close here what percent of Pulse customers were automation customers, is the Pulse attrition rate still tracking to that roughly kind of 30% better than kind of historical attrition now that you've got maybe what four or five years of history now of Pulse customers? And also just kind of part of that I was wondering it obviously makes sense to kind of try to attract higher quality customers on any day in any business but does that focus in any way indicate that some of the experience on the early Pulse customers hasn't been quite as good as you thought? And so there's a further level of scrutiny and screening around Pulse specifically? Sorry for the multipart but thank you. Naren K. Gursahaney - President, Chief Executive Officer & Director: All right, Jeff. So, first, starting on the automation side. I think it's north of 40% of our new Pulse customers are coming with automation. So, that's on the new side. When you look at it from a base perspective, I expect that it's higher than that from a base perspective, again, because it's got better retention, and over time, if we are losing Pulse customers, we would be losing more non-automation customers. The attrition rate, again, continues to be very good. I would refer back to some of the data we shared in our Investor Day, and things are continuing to hold there. As far as the quality growth piece, Jeff, again, I think what's happening is, our ability to segment the data and segment customers better through our analytics is what's helping us just be a little bit more surgical than our approach. I think when you look at the economics on a portfolio basis, they've always been very good. We've talked about what the IRRs are. What now we can do is we can surgically remove some of those less-attractive customers within a tranche, and focus on the more attractive customers. So again, while we are walking away from some business, it will help not just our operating metrics, but it will help the overall profitability and free cash flow for the company. And we know how important that is to our shareholders and we want to make sure that we're using every penny wisely for them.

Thank you. Naren K. Gursahaney - President, Chief Executive Officer & Director: Thanks, Jeff. Operator we'll take our last question.

Our final question comes from Jane Zhao with Morgan Stanley. Your line is open. Jane Zhao - Morgan Stanley & Co. LLC: Thanks guys for fitting me in. So just quickly Naren you talk about the potential to generate $500 million annual free cash flow closing remarks, I wonder should we see this as a five-year target or do you have a timeline for that? Naren K. Gursahaney - President, Chief Executive Officer & Director: Yeah. I think we said over the next several years, but I would say it's in that – that reflected back three years and I'm looking forward three years. So, I'd say in that three- to five-year range. Jane Zhao - Morgan Stanley & Co. LLC: Okay. Great. Can I maybe squeeze in one more quickly? I just wonder if you guys can maybe break out your current attrition by the non-payable entry and the relocation bucket as you have done in the past? Naren K. Gursahaney - President, Chief Executive Officer & Director: Yeah. Why don't we – Jane, we'll get back to you on that, just so we can pull up those details. I don't know if we have it handy or if you want to... Jane Zhao - Morgan Stanley & Co. LLC: Yeah. Sure. Definitely. Thanks. Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: Okay. Thanks. We can give you a call back on that – rather, Mike, unless you have some... Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: I mean, I don't think it changed much since you've seen in the Analyst Day. So, I would expect that the Analyst Day would be your best – your best view of that for right now, Jane. Jane Zhao - Morgan Stanley & Co. LLC: Okay. Cool. We can follow up offline. Thanks, guys. Michael S. Geltzeiler - Chief Financial Officer & Senior Vice President: Perfect. Thanks, Jane. Naren K. Gursahaney - President, Chief Executive Officer & Director: All right. Great. Well, again, thank you all for joining the call. Again, we're excited with our performance, and we continue to be very excited about the future for our business and we look forward to our next quarterly update.