Good morning, and welcome to the Conduent Second Quarter 2023 Earnings Announcement. [Operator Instructions] As a reminder, this conference is being recorded. At this time, I would like to hand the call over to Giles Goodburn, Vice President of Investor Relations. Thank you. You may begin.

Thank you, operator, and thanks, everyone, for joining us today to discuss Conduent's Second Quarter 2023 Earnings. We hope you had a chance to review our press release issued earlier this morning. Joining me today is Cliff Skelton, our President and CEO; and Steve Wood, our CFO. Today's agenda is as follows: Cliff will provide an overview of our results and a business update. Steve will then walk you through the financials for the quarter as well as providing a financial outlook. Cliff will then provide his closing comments. This call is being webcast, and a copy of the slides used during this call as well as the press release were filed with the SEC this morning on Form 8-K. This information as well as the detailed financial metrics package are available on the Investor Relations section of the Conduent website. During this call, we may make statements that are forward looking. These forward-looking statements reflect management's current beliefs, assumptions and expectations and are subject to a number of factors that may cause actual results to differ materially from those statements. Information concerning these factors is included in Conduent's annual report on Form 10-K filed with the SEC. We do not intend to update these forward-looking statements as a result of new information or future events or developments, except as required by law. The information presented today includes non-GAAP financial measures. Because these measures are not calculated in accordance with U.S. GAAP, they should be viewed in addition to and not as a substitute for the company's reported results. For more information regarding definitions of our non-GAAP measures and how we use them as well as the limitation to their usefulness for comparative purposes, please see our press release. And now I would like to turn the call over to Cliff.

Thank you, Giles. Welcome, everyone, to Conduent's Q2 Earnings Call. I'm joined by our CFO, Steve Wood, who will follow me with the financial and sales details. Today, I'm going to focus on 4 key messages. First, and importantly, will be a Q2 flyby, if you will. Q2 was a good quarter for us with puts and takes, but generally exceeding expectations. Second, these days, no one can get through a discussion without touching on those 2 popular and sometimes hyped up letters, AI. And more specifically, Generative AI. We'll discuss how we are approaching this new opportunity since we've been using traditional AI capabilities for many years. Third, you'll recall, we discussed back in late March 3 important pillars critical for our medium to long-range journey. Portfolio rationalization, payments or specifically real-time or instant payments, we talked about several key growth areas with a specific call out in government health care and a particular focus on our Medicaid platform, we call CMdS or Conduent Medicaid Suite, a production-ready application portfolio supporting states migration from large legacy MMIS systems to a digital cloud-hosted SaaS platform. And fourth, I'll discuss what we're seeing in the marketplace and the impact on our clients and our associates. So let's start with an intro into these reports. In the second quarter, Conduent delivered healthy financial results as we continue to meet or in this case, exceed, what we previously positioned for you. Despite a somewhat challenging macroeconomic situation, which I'll talk about in a minute, we posted $915 million in revenue with a 10.2% adjusted EBITDA margin or $93 million versus $87 million in Q2 2022, otherwise stated, an 80 basis point lift year-on-year. There are a lot of moving parts in those numbers, certainly aided by a strong quarter for government and our…

Thanks, Cliff. As we have done in the past, we are reporting both GAAP and non-GAAP numbers. The reconciliations are in our filings and in the appendix of the presentation. Let's turn to Slide 5 and discuss our key sales metrics. Q2 sales results were enhanced by the closing of our large transit deal for the state of Victoria in Australia. This long-duration deal initially valued at around $1 billion of total contract value contributed $65 million to our strong ACV bookings of $208 million in the quarter. That $208 million of ACV represented a 16% growth year-over-year and 66% sequentially against Q1. I'll talk in a minute about some of the specifics on the transit deal in terms of how we're laying out the recurring versus the nonrecurring pieces of the revenue and our initial expectations on timing of revenue. Before that, I'll point out that in the first half of 2023, we are roughly flat year-over-year for ACV. We have a strong pipeline of deals in the second half of the year, especially as we had some decent sized deals push into the second half. In addition to transportation being strong in the quarter, our Government segment had a good ACV sales quarter as well. Both government and transportation segment bookings are well above the first half of 2022. Offsetting that, our Commercial segment bookings were lighter for a second quarter and below last year, both for Q2 and the first half. In the Commercial segment, we're seeing longer decision-making cycles and slightly more cautious buying behavior we think driven by broader macro concerns. The pipeline is still strong, but the deals are taking a little longer than expected to close, and it's changed our likely mix of full year sales. Let me double-click now on some of…

Thank you, Steve. As I said, this was a really strong quarter for Conduent. We're certainly proud of that. We continue to manage through the macroeconomic factors we have in front of us in our Commercial business. But our pipeline and our sales remain strong, and we're achieving significant milestones on many large implementations. As always, we're focused on delivering for our clients, and we thank them for their business and loyalty. I'd also like to thank our 60,000 hard-working associates who take care of those clients every day. Finally, this all demonstrates that our team is executing the strategy we had outlined earlier in the year and building momentum against what we told you back in March. As always, please reach out to our Investor Relations team if you have any questions. Thank you all very much for joining us today.