Greetings, and welcome to the Align Technology Fourth Quarter Earnings Teleconference Call. [Operator Instructions] And as a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Shirley Stacy, Vice President of Communications and Investor Relations.

Good afternoon. Thank you for joining us. I'm Shirley Stacy, Vice President of Corporate Communications and Investor Relations. Joining me for today's call is Tom Prescott, President and CEO; and David White, CFO. We issued fourth quarter 2014 financial results today via MarketWire, which is available on our website at investor.aligntech.com. Today's conference call is being audio webcast and will be archived on our website for approximately 12 months. A telephone replay will be available today by approximately 5:30 p.m. Eastern Time through 5:30 p.m. Eastern Time on February 5. To access the telephone replay, domestic callers should dial (877) 660-6853 with conference number 13598471 followed by pound. International callers should dial (201) 612-7415 with the same conference number. As a reminder, the information that the presenters discuss today will include forward-looking statements including, without limitation, statements about Align's future events, product outlook, and the expected financial results for the first quarter of 2015. These forward-looking statements are only predictions and involve risks and uncertainties such that actual results may vary significantly. These and other risks are set forth in more detail on our Form 10-K for the fiscal year ended December 31, 2013, and our Form 10-Q for the third quarter of fiscal 2014. These forward-looking statements reflect beliefs, estimates and predictions as of today, and Align expressly assumes no obligation to update any such forward-looking statements. We have posted a set of GAAP and non-GAAP historical financial statements including the corresponding reconciliations and our fourth quarter conference call slides on our website under quarterly results. Please refer to these files for more detailed information. With that, I'd like to turn the call over to Align Technology's President and CEO, Tom Prescott. Tom?

Thanks, Shirley. Good afternoon, everyone, and thank you all for joining us. On the call today, I'll provide some highlights from our fourth quarter and full year results and then briefly discuss the performance of our 2 operating segments: Invisalign Clear Aligner, and Scanner and Services. I'll also provide some color on our customer performance, as well as progress in our geographies around the world. David will provide more detail on our financials, discuss our outlook for the first quarter, provide some commentary on our overall business for 2015. Following that, I'll come back and summarize a few key points and open up the call to questions. We are pleased to have delivered a good quarter and finish to the year, driven by continued strong growth in our EMEA and APAC regions, along with solid results in North America. Q4 revenues of $198.6 million increased 11.4% year-over-year, and Invisalign case volume growth of 14.2%. For the full year, revenues of $761.7 million increased 15.4% year-over-year, reflecting growth across all customer channels and geographies, as well as expansion of our customer base and increased utilization by existing doctors. I'm also very pleased to report that shortly after the New Year, we shipped our 3 millionth Invisalign case destined for an Invisalign teen patient in the New Jersey area. This is a significant milestone for Align, for our doctors and for our employees. It took us 10 years to reach our 1 millionth case, another 3 years to the next million and only 2 more years to reach 3 million patients now and counting. On an overall basis, 2014 was another great year for Align. Our results reflect continued execution of our strategic plan, including our 3 key strategic growth drivers, which are market expansion, product innovation and brand strength. I'll provide…

Thanks, Tom. Before I get into the details, I'd like to note that unless stated otherwise, all of the financial information I'll discuss will be presented on a GAAP basis. With that, let's review our Fourth Quarter and Full Year financial results. Revenue for the fourth quarter was a record $198.6 million, up 4.6% from the prior quarter and up 11.4% from the corresponding quarter a year ago. Fourth quarter Clear Aligner revenue of $186.4 million was up 4.7% sequentially and up 12.2% year-over-year. Sequential revenue growth reflected strong volume from our international doctors, offset somewhat by a decrease in ASPs. Q4 ASPs were down sequentially $22, of which approximately $18 or $2.3 million in aggregate, was primarily related to the weakening euro. Our year-over-year revenue growth reflected Invisalign case volume growth across all customer channels, offset by lower ASPs, again, primarily related to foreign exchange rates and higher discounts. For the fourth quarter, total Invisalign shipments of 126,900 cases were up 6.1% sequentially, reflecting continued strong international growth, which was up 17.1% sequentially, whereas North America was only up slightly. Year-over-year, case volume growth was 14.2% reflected in increased utilization, primarily from North America orthodontic customers, as well as expansion of both our North American GP customer base and international doctors. North American orthodontists, Q4 Invisalign case volume was seasonally down 1% sequentially and up 12.6% year-over-year. For North American GP Dentist, case volume increased 4.9% sequentially and 4.1% year-over-year. For international doctors, Invisalign case volume increased 17.1% sequentially and 29.2% year-over-year. Worldwide, Invisalign utilization in Q4 was 4.4 cases per doctor, unchanged from 4.4 in Q4 2013. North American, ortho utilization of 8.6, increased from 8.0 in the prior year. North America GP utilization of 2.9 was slightly down from 3.0 of the prior year. In international, doctor…

Thanks, David. On an overall basis, 2014 was a year of solid financial results and excellent strategic progress. Our teams continue to deliver in virtually every area and a few where we're not satisfied, like our North America business, we are taking important steps to accelerate growth to become even more relevant to our customers. We believe the evolution in the go-to-market strategy for the North American business, including the strategic deployment of more optimal coverage and the right technology tools and support for our combined marketing and sales teams is the right thing to do. I'm confident these investments will deliver a great return for our customers, our shareholders and our employees, and result in getting Align back to the midrange of our long-term target growth rate. Given the number of attractive investments to grow the top line, drive improved customer outcomes and satisfaction, and better profitability, we are making the choice to manage the business carefully through this cycle of heavier investment, with the commitment to restage growth towards that middle of our long-term model range and deliver improved operating margins. The entire Align team is committed to making this happen. I'm extremely excited about our progress, and I look forward to discussing this with many of you as we get out to dental trade shows and investor events over the next few months. And with that, we will move to take some questions. Operator?

[Operator Instructions] And I do see the first question is coming from the line of Jon Block with Stifel. Jonathan D. Block - Stifel, Nicolaus & Company, Incorporated, Research Division: I've got a handful, but I'll try to keep it to 2 and then I'll try to follow-up with you guys off line. I think I'll keep it big picture, Tom, I'm looking at 3- to 5-year models that say, Op [ph] margins of 25% to 30%. And it looks like because of the investment in OSA, you're thinking about going down in the near-term and some currency, but maybe down to around 20% or 21%. How quickly are these accretive? I mean, I'm just trying to think of if you were to even get to 25% Op [ph] margin in 3 or 4 years, your leverage would have to go something like 20%, 24%, 26%, 29%, to even get to the bottom end of the range. So can you just help us with your confidence that you can get to 25% plus Op margins in 3 to 5? And why you think they're going to be that accretive that quickly? That's the first question.

Sure. Thanks -- or maybe 1a. I'll start and then ask David to come in behind me. The biggest thing here is FX as everybody adjusts to it. We've got plenty of company. That's the biggest single move pushing us down. Secondly, we have some transitory investments like initiation into sleep apnea that is more development-focused that is a little bit of a deferral for revenues streams, and I'd say that I think within the next year or so, we'll have at least some initial commercialization. From that point on, it should start to be closer to accretive. Third, we've got investments in the factory and some other places in infrastructure that are kind of period investments and then amortized over time, so it's a little lumpy here. If I come back to maybe the most predictable returns, they are on the go-to-market side. And with some exhibits we put out, some slides, I think we tried to -- given the size of the investments and the intensity of what we're trying to do, we want our owners to understand where that money was going as we provide a lot of information this quarter. If we look at what's going on in Asia, in EMEA and what we believe will play out now in North America, we believe those will start to return within 2 or 3 quarters, increments of coverage, doing better things in the right places, better programs for customer and all that. So if I started to go to market side, reasonably good track record there of demonstrating. And even in North America where we haven't been where we wanted to, we have delivered incremental results in the back half of the year, virtually every year, where we put incremental results in, maybe, in Q4, Q1. We…

Yes, I guess I would -- I'm not sure there's much to add there, actually, Jon. But we -- as we said in our remarks, if you look at 2014, we delivered within the operating model, and we continue to believe -- holding aside FX, our business will continue to grow year-over-year within that operating model, and so that's an incremental leverage that we should get off of the growth we expect to see this year with under almost all other circumstances fully cover the incremental investments we're making this year. The only carve-out we made was those 2 carve-outs: one for OSA, which is outside our core business; and then the other, which was enterprise computing, which is -- or enterprise systems, which is certainly inside our core business but is more of a limited duration in terms of how long that investment would be ongoing, more on the order a year or a year-plus, and so we feel like we're already getting leverage off of the scale as the business grows from the fact we believe we can absorb all those investments with those 2 carve outs only, so...

FX aside, yes.

Yes, FX certainly aside.

Let's go to 1b. Jonathan D. Block - Stifel, Nicolaus & Company, Incorporated, Research Division: Yes, and then I guess 1b, and again, I'll follow-up with you guys on some more. But just, Tom, you didn't discuss your exact plans long-term with OSA and selling. But why now? I mean, you've been slugging it out and trying to reaccelerate growth here in North America, and I think it's been, in your words, a little bit tougher than maybe you had assumed 12 months ago. Why deter management focus, sales focus by going after OSA now instead of continuing to try to reaccelerate growth in a market where you, say, 25 million to 30 million people are looking for a solution to straighten their teeth?

Sure. They're not mutually exclusive. These are different resources going to development cycles and upstream marketing, not -- and clinical development, clinical trial, et cetera -- not to sales, downstream marketing, anything. Secondly, as we dig a lot deeper into North America GP, and we really come back, and one of our clinical objectives for a long time, has been how do we become even more relevant with our average customer doing 10 cases a year doing against 3,000 dental procedures they do a year or more in a bigger office. So increasingly, they're interested by, and working with, new opportunities as patients think about expanding how oral health fits with their dentists and with physical health, and this is a very fast growing area, and we think it's an opportunity that directly leverages our strength. The other part of this is, globally, we probably now, I believe, have the largest specialty sales force in the world. And the reality is here that we're going to have an opportunity over time to put more high-value products into that team, covering the right GPs, doing the right things. That's not today. There's 0 distraction for this team. They're off and running, but over time, we'll have an opportunity to add more to the basket. In an area that is not a bolt-on just to have something, it's an area where we think we'd add real value to and can leverage our core competencies to the better, so there's never a perfect time. We have said for a long time that we don't have the money burning our hole in our pocket. It's more that can we find opportunities that fit our strategic direction that would leverage our core competencies and would extend our ability to add value to customers, and in this case, it's all 3. So that's why now, and obviously, FX is a lousy time for everybody, but we're not apologizing or complaining. We do believe these are the right investments to push through for the business.

And our next question comes from the line of Glen Santangelo with Crédit Suisse. Glen J. Santangelo - Crédit Suisse AG, Research Division: David, I just wanted to follow-up on some of the stats you gave. I think if I heard you correctly, you seem to suggest that the euro -- the exchange rate has fallen 16% from the average level in 2014? And you thought that, that would impact your revenue run rate by 6% to 7% and your operating margin by 4 to 5 points? Did I hear that correctly, number one?

Pretty close. All except for the last part of the 4 to 5 points. The 4 to 5 points included not only the impact of foreign exchange rates but also included the 2 investments that I talked about earlier, which was OSA and enterprise systems, so that's also in that 4% to 5% bucket. Glen J. Santangelo - Crédit Suisse AG, Research Division: And if I look at your Q1 ASP levels, I think your revenues and K shipments kind of implying something in the low 1,300. This -- it seems to be down about 6% year-over-year and maybe down about $50 on a sequential basis. You did a good job in sort of quantifying how much of that was FX this quarter. How much of that do you think is FX-driven next quarter, because I'm trying to assess whether there's any sort of mix and -- or mix changes in that number?

Well, I have no idea what foreign currency rates are going to be for second quarter, so... Glen J. Santangelo - Crédit Suisse AG, Research Division: I'm guessing you're making some assumption, right, when you're kind of giving these revenue numbers, right? So I'm kind of curious about maybe what -- I'm trying to back in to maybe what you're assuming from a currency perspective in this quarter.

Yes, fair enough. Fair enough. So right now, the best indication we have for currency rates for 2015 are the current rates that prevail today. We're not in the habit or we're not experts on projecting foreign exchange rates, and I would guess there's probably any one that is, so all of the assumptions we talked about for 2015 assume that the rates that prevail today prevail throughout the entire year. And so to the extent those rates change in either direction, that will have some bearing on how 2015 ultimately shapes up as we talked about here. Glen J. Santangelo - Crédit Suisse AG, Research Division: That's perfect. Tom, maybe can I just squeeze one more in on some of these investments you're making in North America? Could you give us a sense for how many bodies you have on the ground right now? How many you think you need to hire? Because I think we're all trying to assess what -- how much of these -- or how big the incremental investments are going to be and then how we should think about them as a percentage of ongoing cost versus maybe onetime in nature, and then I'll hop off.

I'll answer the question consistently with what we've previously discussed. Given that we're going to continue investing the growth in market expansion, which is a fairly reasonably predictable lever for us, you should expect us to invest into each of our geographies each year to a greater or lesser extent. Over the past few years in North America, even with some meaningful bodies on a percentage basis, it was less and less as we were really throwing more percentage increases into EMEA and APAC. Secondly, I think when I talked about -- in addition to just getting behind the curve a little bit in North America, our game didn't evolve as well as it should have in terms of what we were doing, who we were doing it with and how effective we could measure and deliver. And so over the last year or 2, we've been looking at overhauling a lot of that. So besides just headcount, there are a lot of positive changes about how we're doing it. With that said, we threw a slide in there somewhere. I don't have a number, but it's -- we basically showed in North America, EMEA and APAC with a bar at the left. I'm not going to give you absolute numbers, you can get yourself pretty close, showing what our total headcount is and then also showing what our incremental increases are over prior -- over 14 in each of those geographies, so we give you most of what you need there. This is a bigger number of heads in North America, and at a fully-loaded cost, a little bigger of a load, but it's not as big as a percentage increase, which is more than doubling what's going on in, say, APAC, so I -- we tried to size…

Our next question comes from the line of John Kreger with William Blair. John Kreger - William Blair & Company L.L.C., Research Division: Actually, Tom, can you just expand on what you were just saying? If you think about, specifically, your North American GP business where growth has slowed a bit, can you just talk a bit more about what your strategy is to reinvigorate that? It seems like that's a customer base that's going to be a bit more fragmented, probably lower volume ortho customers in general. Do you think you can really reach them efficiently with a direct sales model?

Sure, the answer is yes, John. It's hard, but it's worth doing, and there's 2 or 3 things that intersect here for us. The first here are the 20-plus thousand active GP customers in North America. There are quite a few that would like to do more. Whether they're 10 and they want to go to 30, whether they're 30 and they want to go 50 or whether they're 5, they just got trained but they're really ready to go. We have been -- we found it very, very difficult over the last year, 1.5 year to cover all of them, and we've got some great success stories where we were able to work with the practice the right way and they've really built a terrific business, delivering great customer results, patient results, et cetera, but that's -- not enough of those. Part of this is a very detailed segmentation that we can help our reps, our region managers, our teams recruit better, the practices that are -- that really do want in that really are -- the wrong word is fit but I'll use it for the moment. And then also, the customer base we've got work with those customers that really want to elevate their game, that really want to make Invisalign and some straightforward ortho a part of their practice to fit in with their restorative. And there's thousands of such customers who want more access, time and energy from us and are more than willing to partner. We know who they are by address, by name. Many of them have declared so, and so our job is to give them the right coverage, the right tools and support to make that happen, and so we're not going to move the whole -- the needle on the…

Yes, roughly 2/3 of it is FX and then the balance is the 2 investments we talked about.

And our next question comes from the line of Jeff Johnson with Robert W. Baird. Jeffrey D. Johnson - Robert W. Baird & Co. Incorporated, Research Division: Let me just focus on the -- those 2 incremental projects here that we're talking about. On the ERP side, I still consider you guys a fairly young company, you're not a serial acquirer. What's wrong with ERP systems now? Or why do you need a new ERP system, especially in a period where maybe you're investing heavily in the sales force? Currency is going to hit margins and things like that. I mean, why now on ERP?

Yes, Jeff, this is David. So first of all, the company -- every year, as we go through our strategic planning process and annual operating plan and so forth, we review long list of projects that are worthy of investing in and helping focus on to grow the business, et cetera, and ERP's actually been on that list for a long time. But when you look at the ROI we've been able to get out of product innovation and ROI out of market expansion and so forth, it has just never gotten to a point where it's raised itself to a hurdle rate that made it -- make the cut, you might say. But as we've grown and as our businesses have gotten more complex, it's become more clear to us that we have opportunities to streamline our business, to become more agile, to service our customers better, and one of the things that we believe is standing in the way of that is having a unified platform as a company under which we can present our business to the doctor, under which we can execute the workings of the company. And so it's gotten to that point where it's made the cut, and so we're biting the bullet to make it happen, and we think it's going to be something that ultimately will give us not only better agility but better scaling ability. But perhaps even more importantly, it's going to give us some capabilities with our doctors that today we presently don't have or can't fully take advantage of. Jeffrey D. Johnson - Robert W. Baird & Co. Incorporated, Research Division: All right. And you think those are about 1 year of investment, David?

Yes, 1, 1-plus typically is the horizon. Jeffrey D. Johnson - Robert W. Baird & Co. Incorporated, Research Division: Okay. And then my second question is just on the sleep apnea. As I think about that treatment area in dentistry, most of the companies I'm talking to in that area look at full airway analysis that needs a larger imaging device, whether it's 3D imaging or something like that as opposed to just your scanner technology. So what I'm trying to figure out what your competitive advantage might be. And two, when I think about that competitive advantage, typically, I believe it's just you order a mouthpiece. And then while you guys are good at maybe 3D printing that mouthpiece or generating that mouthpiece with your manufacturing technology, again, I think of your core competencies in kind of high throughput multi-aligner manufacturing, not manufacturing a single mouthpiece for patients. But I'm just trying to figure out why you guys might be the company to do sleep apnea as opposed to a company that has bigger imaging technologies or isn't -- doesn't have your core competencies that seem stronger to me elsewhere.

That's a very fair question, and what I'd say is that we don't expect to replace all the other players. Oral appliance therapy is -- today is still a very small part of a pretty big market, and it's a profoundly tough disease for people that have it. And for people that have OSA, having BiPAP or CPAP therapy is the standard of care. We don't expect that changes anytime soon. But a, there are people that are refractive to that treatment, just do not want to do it; or b, they are very mild to moderate, and this is a rapidly growing area. The second part of this is if you look at the intersection of treatment planning and algorithms to be very predictive, today, the titration process for figuring out how much advancement is necessary to keep that airway open, how comfortable that is for the patient, how many visits to the dentist office and the patient have to have, it's just -- it's very difficult. We believe there are opportunities that dramatically streamline that, building on all the diagnostic data that's out there, from the sleep doctor to lab and perhaps an MD, who's also in the loop. But dentists are in this business. They're increasingly -- and they're the right ones to think about how much mandibular advancement can you do without impacting TMG [ph] or anything else, so our job is to help them with clinical algorithms that make sense. And whether we're making -- we make part numbers of one. Every part number that goes through our factory is a part of one. It's not a series, and whether that's part of a case or one broke along the way, we can have a part of one go catch up with that case further on in the process, so this is about mass customization, very, very precise computer-controlled treatment planning and clinical algorithms. And I think, again, I'm not going to go any further, this is complementary with what other people are doing, but we believe better, cheaper, faster and far more effective.

The next question comes from the line of Steve Beuchaw with Morgan Stanley.

Can we just simplify the discussion around ASPs? The comment, David, that you made was you were looking for revenues and volumes both in the high-teens, excluding currency. Is that right? And does that imply that ASPs are flat ex currency?

So number one, currencies don't affect volumes. We think volume growth like -- will be within our long-term model, number one. Currencies does affect revenue, but if we neutralize that effect and we just simply look at constant currency, if the current -- the exchange rates in 2015 were roughly equivalent to 2014, our revenue, we believe, would grow within our long-term model and be relatively consistent with what we delivered in 2014.

Okay. And then the commentary around the addition of manufacturing capacity in Juarez, could you give us a sense of what the impact is on the P&L from that capacity expansion just in terms of incremental spend?

It's relatively small this quarter. We're in the process -- I think we've talked previously about -- at some point, we would need to add additional brick-and-mortar in addition to just simply buying additional pieces of capital equipment that actually operate in the factory. Well, we've gotten to that point. That factory will come online sometime later this year, and we will expect to bring up that capacity gradually over time as it's called upon, and so we'll try to make sure that the -- make sure those capital additions of equipment, so forth, are staged, commensurate with how our business is growing. As it relates to the impact for the year, I think there's a modest impact, a little bit, on gross margin for the year, particularly the second half of the year. But as I gave guidance for 2015, we've ultimately believed that our revenue growth and everything else, holding currency aside, would absorb that and still deliver our business within our long-term model, including gross margins.

Okay. Great. And then -- and Tom, you made mentioned again the possibility of working with additional partners in intra-oral scanning. Any updated thoughts on the right time lines for that kind of move?

Just that it continues to be significant activity for the enterprise. We've indicated as clearly as we could that this is strategically valuable for the enterprise to do, and that you ought to assume we're out working with logical players that have interest in the same. This is one of these where until it's ready, we don't want to talk about it, and that's about as far as I'd like to go.

And our next question comes from the line of Bob Jones with Goldman Sachs.

David, you mentioned hurdle rates in deciding on some of these investments. Any more you can share on how you decided whether these investments were the best return on capital? I'm curious just as far as the decision-making process and how you contemplated the timing of doing all these investments at the same time if we're thinking about the sales force investment, ERP, sleep apnea, et cetera.

Well, first of all, when we -- we have an ongoing process for evaluating projects that are currently underway as well as -- and early in the funnel in terms of our execution on them as well as projects there at the top of the funnel or just kind of circulating around in the way of ideas. Somewhere between those 2 points, a business case gets put together, a feasibility analysis gets put together. And as those things come together, we're presented with an opportunity to decide whether or not we've got capacity to add resources to it and pursue that project or not, whether or not we can constrain it within our operating plan or not, et cetera, and so I wouldn't say there's a single litmus test that we applied to all these because there are certain -- many of these projects have intangibles associated with them that are not easily measured in a highly quantifiable way, but as we look at those intangibles and we look at the tangible things that we can measure and we look at how they'll -- our available resources and we look at how it fits in our envelope and so forth, those things all come together to make, you might say, an informed decision. Now as we go through our strategic plan, our annual operating plan process, there's a process we go through that based on that criteria, we begin winnowing some of that down. And as it related to the projects that we're looking at doing for 2015, we felt like we had a significant number of projects that had high return opportunities on them. We felt that we could basically fit them, you might say, within our operating model as our business grew and so forth, and we decided to execute on those, and we approved them, and we're staffing for them accordingly. The only 2 that I carved out were OSA, which is outside of our core business but yet we feel, over a longer term, is a little bit longer horizon, is going to be accretive as well; and then, as we talked -- as I mentioned in the prior question, enterprise systems as well at the same time.

Hey, Bob, if I could pile on just for a second. In addition to a standalone business case or investment choice, there is significant interdependence between some of these investments. There are things we want to do as a company. I spoke briefly at the recent conference about this thing we're calling our little, in a small way, not grand, digital ecosystem, and that's a way of surrounding customers in a very different way with our scanner and others bringing in much higher value set of work streams and new applications; physical and digital. And in that direction, becoming a heck of a lot more relevant. This is where you start getting to adjacent therapeutic opportunities that would trade well on our core competencies like sleep apnea, and it became very compelling. And now then you come back to ERP, and if ERP can enable acceleration in some of these things, the payback for an ERP project, we might have waited a year or 2, starts looking more attractive because it enables acceleration in other areas. And then finally, you come back to number one, we were -- I will speak critically of ourselves here. In the last couple of quarters, we've not been satisfied with the deceleration in growth rate in North America, especially in the GP side, and we're bound and determined to fix it. So as we look at that, and we look at what we could put into that team with evolving products we haven't spoken about yet, with other things in the pipeline, we want to get a team in place, surround the customer properly with a whole lot of new capability and then we can really start to leverage the top line for whole streams of other kinds of revenue as we're looking out here. Again, we're trying to make the organic machine even better, and so there is significant interdependence. These aren't always so easily standalone.

That's fair. And I guess just the related question to that would be around other uses of cash, and you guys had, had a 3-year repo program out there. I'm just curious as, I guess, twofold as you evaluated these investments on a return basis, how did they stack up relative to just a larger buyback? And then any update on how we should think about the repo in light of these investments would be helpful.

I'll start and let David answer your direct question. The simple fact is everything we're talking about has high NPV. We're trying to be very good stewards here, and yet we see this opportunity to accelerate impact and progress in the business, certainly to the midterm. We believe we can restage growth more closer to the middle of our range where it had been hanging around the low end, and let's put FX aside just a moment. We look at all that first and then we would come back and evaluate our capital allocation strategy in the context of our long-term strategy and then have thoughtful discussions with our Board about it. I'll let David comment specifically on our progress on the buyback and how we go from here.

Yes, I guess I would add one thing to it and that is as we think about our investments each -- almost each and every day around here, most of them are P&L investments. They're not significant capital investments on the balance sheet like plant and equipment. Certainly, we talked a little bit about that on the call today about adding capacity on the manufacturing side and so forth, but when you look holistically across all the investments we make, most of them are P&L-related, and so we do feel some -- there is a balance between how much we put into the P&L, how long it's going to take for us to recognize returns from that because as we grow top line, as we grow leverage with scale and so forth, that brings more to the bottom line that either gets flows into cash and ultimately back to the shareholders through repurchases or flows into new opportunities for us to invest -- reinvest back into the business, and so that's kind of the way we look at it, and when we -- last spring, when we had our, I think, our Q1 call and we talked about a definitive program for stock repurchases is in light of those trade-offs. And at that point in time, as we looked at our long-term model and our long-term cash-generating capability, we recognized that those P&L investment opportunities are only going to take -- are going to -- only require some percentage of our cash flow generation over that time period. And that excess, above and beyond what we thought those needs would be, either for those projects or, strategically, for longer-term things, we should be able to return to shareholders. And that's how we came up with number one, the $300 million stock repurchase plan, number one. And number two, it's also what informed us as we expanded our business models to include free cash flow generation. And it's that free cash flow generation that the excess of which we would expect which we would expect to use for stock repurchases. So you should expect that sometime over this year, we'll commence repurchasing the second $100 million out of that $300 million, and I think you should also expect that in line with that long-term cash flow model we're talking about, at some point, we'll revaluate that. We just haven't gotten to that point where it make sense to do that, but that's certainly how we would see it playing out.

And our next question comes from the line of Chris Lewis with Roth Capital Partners.

Tom, I guess, I was hoping you could elaborate just on the revamped go-to-market approach in North America, specifically beyond just adding the 50 heads. Can you elaborate on the types of changes that are being made within the actual structure of the sales organization there whether it's changing the territory size or level of support service or the compensation structure?

Yes to all of the above and more. I mean, it starts, Chris, with making sure you've got the right people in the field and then doing the right things and, importantly, at the right customers. We've thrown a lot of heads out in the field over the last 3 to 5 years, and we've trained a lot of doctors. And I'm overstating for affect, but in some cases, we left the region managers and the reps to figure out who to call on. And while we tried to drive a more systematic, I'll call it, scripted approach, we were only partially successful with that. The evolving go-to-market game plan is a bigger team, organized a bit differently, smaller regions, more line of sight, expecting longer calls in the office more, fewer customers and calling on the customers that are -- that fit, that are committed, that really want to elevate and spend more time, not as -- an earlier question said they're fragmented, not every dentist even wants to do ortho, and so -- and by the way, along the way, we're finding ways we can support low-volume customers that are very valuable to us, but really don't want to put more time and energy now. 15 cases a year is just fine for them, and we'll find ways to support them. We are struggling to do that. One of these evolutions is we're finding a support model that can do that. The important thing is here is we're already getting some very good feedback. This actually started fairly early in Q4 in a small way, and we pretty much had everybody on board before the end of the year. So as we did kick off meetings. We typically do that each year all around the geographies. Everybody's up and running, and they're on the same page. Finally, we've got better tools. I mean, it seems basic, but the right people in the right account doing the right things in a very systematic way and then measuring progress literally day-by-day, account-by-account. So far more prescriptive about our approach, far more consistent about how we block and tackle, very specific learning from segmentation about where we're spending our time and energy and then finding more cost-effective ways to support lower volume customers that today don't want to do more, but they're still very valuable to us, and they're great customers, and someday, they may. And then behind all of that, our goal is to build a bigger installed base of scanners, ours and others, and leverage those with more applications, like the outcome simulator for Invisalign and clinical applications at chair-side. It should make everything easier for that doctor. So that's -- I called it earlier days there, but the team is managing through the churn very well so far, and they're off and running. So a lot of changes, as I said, comp, structure, et cetera.

Great. I appreciate the color there. And then David, maybe a question for you on ASPs, maybe 2 parts first. Are there any other levers beyond FX that's driving the implied sequential decrease from the fourth quarter to the first quarter internationally? And then secondly, how should we think about ASPs in North America as we progress into 2015 versus 4Q levels?

So primarily, if you look at it year-over-year and you look at it quarter-over-quarter, FX basically drove 80%, 90% of the decline that we see in both those comparatives, and the same would hold true, Q4 to Q1. There are other effects. You asked about international, and I think the same would apply somewhat to North America. We do have periods of running various kinds of promotions, which yield different kinds of discount and so forth, and those sometimes have different seasonalities associated with them. So for example, we'll run specific promos and discounts heading into the Q3 for the teen season for the orthodontic channel -- orthodontist channel. So there was some of that in the fourth quarter as it relates to some of those kind of discounting programs running in Q4, but the vast majority of it is all FX.

Chris, maybe another way to jump on, pile on, was mix is not so much the issue right. It's mostly FX. Mix is pretty stable around the globe, and we more or less expect that to be the case. It's mostly FX, and occasionally, some promotion, but I'd say FX is going to overwhelm those other effects.

Yes, I was just going to say over a -- well we may see a little bit of observations quarter-over-quarter on ASPs. We talked -- I talked previously about the long-term trend in ASPs continuing to be up, and I still believe that to the point that Tom make. If you look at the percentage of our cases that are full cases versus the express cases, that percentage has been relatively consistent over time, fluctuating on a quarter-by-quarter basis by less than a point. When you look at the mix, however, though, between international and North America with the higher growth rates international and the higher ASPs they have there, they just naturally are going to become a more significant piece of the total geographic mix of our business, and that is over the long term, holding FX rates aside, should continue to drive a ASPs up.

That was -- speaking of a product mix, not geographic mix. David is exactly right.

And our last question comes from the line of Brandon Couillard with Jefferies.

Tom, just wanted to get your perspective on how you're feeling about the U.S. market. You have -- coming into the fourth quarter, it feels like it were off to a pretty good start. Would be curious if you could give us some color on how it exited. And then in terms of the 1Q case volume guidance of flat to down, weaker than history would otherwise suggest, can you parse out some of the dynamics there?

Sure. I'll start, and David can pile on if he chooses. First of all, we're not out of January yet. I think the year, in general, we're getting off to a start we'd expect, and that's captured in our guidance. We've got a lot of moving parts here, and all those factors are kind of caught. I mean, we -- I guess, we've got a clear line of sight to rolling out G6 in some of these other geographies. You come back North America, that will really be more limited in the near term. But in general, the team is off and running. I feel pretty comfortable about our general direction. I think if we look back to last year, it seemed like we were getting you guys -- I shouldn't say we, we're out here: Sun's out. But the Northeast, the Midwest especially, we're getting slammed by storm after storm. We were kind of looking at it last week or this week going, "Geez!" But I think notwithstanding that, and all in last year, that was not a very big effect for us over all over time. So in our minds, we don't exactly track dental visits. Maybe there's a lag effect or something, but I think the market is reasonably solid, healthy. I don't know what else to say other than that.

I'll just add a little bit of color because you're looking at historical trends possibly. In my comments, basically what we said was the growth in North America quarter-over-quarter primarily in the orthodontists channel. And if you look at historically, let's say over the last 3 years and so forth, I think our quarter-over-quarter growth in North America has typically been in the low-single digits to mid-single digits from Q4 to Q1, and so I think our -- the guidance we gave for this quarter is not materially different from what we've seen over the last 3 years.

For North America.

For North America.

Okay. And on the new awarded facility, could you quantify the aggregate amount of CapEx that will be needed to complete that facility?

The total amount for the year of all in, not just the plant, but fitting it and stuff?

Yes, I suppose. And I guess in that context, like when it normalizes, do we go back to the maintenance level?

Yes, yes. About $15 million, I think, for 2015, all in. Okay.

It's about right -- I think it might be a little more than that, Tom, but it's not materially different. There is brick-and-mortar in there as well as equipment. We're certainly not going to fit up the entire building by the end of this year, so probably not too different for 2015, but certainly over a longer time -- time horizon as we build that factory completely out, you'll probably be looking at more CapEx on top of that figure.

But that would be feathering in capacity.

Would be feathering in capacity.

Modules of capacity versus the lump you have to go through when you put -- bring a new plan on.

Well, thank you, everyone, for joining us today. This concludes our conference call. We look forward to seeing you at upcoming financial conferences and industry meetings. If you have any follow-up questions, please contact Investor Relations. Have a great day.