Hello, and thank you for standing by. My name is Regina, and I will be your conference operator today. At this time, I would like to welcome everyone to CSG's Third Quarter 2024 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions]. I would now like to turn the conference over to John Rea, Head of Investor Relations and Treasurer. Please go ahead.

Thank you, operator, and thanks to everyone for joining us. Like last quarter, we will be working from a slide deck, which can be found on the Investor Relations section of our website. Please take a moment to locate these slides. Today's discussion will contain a number of forward-looking statements. These include, but are not limited to, statements regarding our projected financial results, our ability to meet our clients' needs through our products, services and performance and our ability to successfully integrate and manage acquired businesses in order to achieve their expected strategic, operating and financial goals. While these risks reflect our best current judgment, they are subject to risks and uncertainties that could cause our actual results to differ materially. Please note that these forward-looking statements reflect our opinions only as of the date of this call, and we undertake no obligation to revise or publicly release any revision to these forward-looking statements in light of new or future events. In addition to factors noted during this call, a more comprehensive discussion of our risk factors can be found in today's press release as well as our most recently filed 10-K and 10-Q, which are all available in the Investor Relations section of our website. Also, we will discuss certain financial information that is not prepared in accordance with GAAP. We believe that these non-GAAP financial measures, when reviewed in conjunction with our GAAP financial measures, provide investors with greater transparency to the information used by our management team in our financial and operational decision-making. For more information regarding our use of non-GAAP financial measures, we refer you to today's earnings release and non-GAAP reconciliation tables on our website, which will also be furnished to the SEC on Form 8-K. With me today on the phone are Brian Shepherd, Chief Executive Officer; and Hai Tran, Chief Financial Officer. With that, I'd like to now turn the call over to Brian.

Thanks, John. Hi, everyone. Welcome to today's call. On Slide 4, we wanted to begin with several exciting highlights that showcase how well team CSG is executing across all areas of our business. First, the big news that has been on every investor's mind. We were super-excited to announce on Monday that we signed a fantastic contract renewal with Comcast. This great win-win deal builds on our 35-year-plus relationship with Comcast, and it gives both companies the opportunity to unlock much greater value in the future by continuing to do more business together. Comcast is undoubtedly one of the biggest and best connectivity and entertainment providers in the world, and we are honored and humbled to continue to serve this industry giant with mission-critical technology solutions well into the next decade. We're also very pleased to raise both profitability and EPS guidance targets for the second consecutive quarter while reiterating all other full-year 2024 guidance targets. We achieved very good profitability in Q3, reporting an 18.4% non-GAAP adjusted operating margin and team CSG believes it can continue to deliver enhanced profitability in Q4 and into 2025 and beyond. It was also great to see the strong profit performance convert into better free cash flow as we generated $37 million in free cash flow during the first nine months of 2024, a 25% increase year-over-year. And as Hai will share more detail on, our cash flow growth would have been even stronger if you normalize out the $18 million in onetime restructuring cost reduction hits to cash flow through Q3 year-to-date. And lastly, our sales wins and deal expansions through the first nine months of the year have been very strong across the board with good wins in digital monetization, data-driven CX and payments. Slide 5 provides some additional color on…

Thanks, Brian. Let's walk through our Q3 2024 financial results, and then I'll wrap up with some key conclusions. Starting on Slide 13, we generated $295 million of revenue in Q3 versus $287 million in the same prior-year period. The increase in revenue can be attributed to the growth of our SaaS and related solutions revenue in addition to the approximately $6 million of revenue generated from the acquired businesses, which offset lower software and services revenue for the quarter. Also, as it relates to our top two customers, Comcast and Charter, we reported a 4% year-over-year increase in Q3 revenue. Please note that approximately $5 million of Q3 revenue was driven by non-recurring project implementations at Comcast. We do not expect this revenue to recur next year in Q3 2025 or subsequent periods. Our Q3 2024 non-GAAP operating income was $50 million or a non-GAAP adjusted operating margin of 18.4% as compared to $45 million or 17.0% in Q3 2023. We are extremely proud of team CSG's operating discipline that led to this 11% double-digit year-over-year growth in adjusted operating profit. Similarly, our non-GAAP adjusted EBITDA was $64 million for Q3 2024 or 23.4% of revenue, excluding transaction fees as compared to $60 million or 22.3% in Q3 2023. Looking ahead, we expect our profitability metrics to further improve as we took significant cost efficiency actions in the first nine months of 2024 to optimize our capacity and better align CSG's resources to areas of our business that will deliver faster growth and higher operating profit in the quarters and years ahead. Lastly, our Q3 2024 non-GAAP EPS grew 15% year-over-year to $1.06 as compared to $0.92 in Q3 2023. This significant increase in non-GAAP EPS is mainly due to higher non-GAAP operating income and the lower share count,…

[Operator Instructions] Our first question will come from the line of Greg Burns with Sidoti. Please go ahead.

Yes.

Hi, Greg.

Just when we look at the Comcast renewal, the fact that you're able to get it done without any price concessions upfront and actually have price escalators baked in, in forward years, are you providing more services? Like what was contemplated in that? Is it more services on your end being provided? Or does that contemplate maybe the number of subscribers declining over time and they're moving down maybe tiers in terms of the level of service you're providing. So there's a little bit of a wash there in terms of what you're going to be providing prospectively. If you could give us any more color on the dynamics that drove the structure of the deal?

No, happy to, Greg. Thanks. It was a fantastic and I would say, win-win contract. There are no -- we had a lot of questions when people saw the press release, are there any kind of hidden step down? The answer is no. It's a strong commitment across the board. We're going to continue to serve Comcast on all the triple play like we do today across almost all aspects of their technology stack supporting triple play. We support Comcast in a wide variety of use cases beyond triple play. That will continue. And the contracts did not have a price increase, that even though we've been investing a lot and the reason we didn't get a price increase day 1 was we wanted to contribute to the strong competitive response we've seen Comcast bring forth in the market. They posted excellent results in Q3, and they talked about they think there's some headroom for growth in their own earnings call. And what we tried to do in this is actually incent them where they do more business with us, either on our more legacy stack or on our Ascendon platform, they could get economic benefit by doing more with this. I'd say stay tuned on that in terms of where it goes. But it is a win-win. There's no step down. There's no degradation of anything we're doing. And the reason for that is because we've invested heavily over the last seven or seven years to just bring substantially more value to Comcast and our other large North American cable broadband providers, and they're seeing the benefit of that, and they're rewarding us for that good investment and the good value that we're bringing to them. It's a fantastic contract, Greg, for us and for Comcast.

Great. And then just in terms of the maybe a little bit of a near-term slowdown you mentioned in the core business. Can you just talk about maybe what the pipeline looks like? Your view on kind of maybe what's driving that in the near term, what the pipeline looks like and your confidence in maybe growth reaccelerating at some point next year?

Yes. No. So what we see is, I mean, I think, first, we love what we're seeing in terms of our sales pipeline, the shape, the size, the coverage ratios, the progression through our six stages and coming out with high win rate on the back end. So that gives us a lot of confidence to reiterate. We fully expect to be a 2% to 6% and we fully expect to be midpoint or higher in most quarters and in most years. What we -- as Hai talked about, we just see the normal belt tightening. I think everybody is feeling it in the global economy, even as there's some positive things around interest rates and others. Every brand is trying to squeeze OpEx a little bit and try to put more to the bottom line. You see that with our own results. And that's what's contributing to a little bit of the slower growth period where we're at the bottom end of that range as opposed to being mid or upper end that we've done for 3.5 consecutive years. And so our best guess is, first, we typically have a big fourth quarter. Let's see how that comes. I mean that's what we're working towards. We think this slower kind of just cost mindset that a lot of customers have is likely to be more of a few quarter kind of horizon. We think we could get back to midpoint or higher in the mid to second part of 2025, maybe sooner. That's our best guess on what we're seeing now. And overall, we like the performance, but we look forward to being at the 4% to 6% versus at the lower end where we have been the last couple of quarters.

Great, thank you.

Thanks, Greg.

Our next question will come from the line of Dan Bergstrom with RBC Capital Markets. Please go ahead.

Yes. On the Comcast contract renewal, just any thoughts around the timing of the renewal? Maybe if you could share what are some factors that enable you to announce it now versus, say, six months from now, a year from now?

Yes. It's a good question, Dan. I mean what we've been signaling the last couple of quarters is this was possible, but Comcast had the pen on that on deciding when they wanted. And I think it kind of came down to one thing that laid the foundation for this is we've performed extremely well in terms of uptime, in terms of value on both the core platform they use for the core triple play and for the platforms they use for some of their digital businesses. We've invested heavily, and that's brought significant value to Comcast. And I think they recognize that and see that. I think secondly, the fact that there was a commitment to put this renewal behind us, focus on how we could co-innovate together and actually bring more value as opposed to spending time negotiating around a negotiating table. And we did give them two meaningful concessions. We gave them no day 1 price increase, which we've seen them raise price with their customers. We've invested. We thought it could be reasonable for us to get a price increase. We were willing to do a flattish contract, and we were willing to give them a no price increase starting Jan 1 as trying to help what maybe their competitive response. So I think they saw that as a fair win-win give on behalf of CSG, and that may be incented them to also think let's go ahead and sign the contract now. We were super grateful for that, and we look forward to what comes over the next six years.

That's helpful. Thank you. And then anything to point out around international trends this quarter? It seemed like Europe was maybe a little stronger relative to last quarter. APAC maybe a little softer relative to last quarter. Just anything to point out in those geographies?

Yes, I'll hit one and then Hai will talk maybe a little bit more about just some of the pricing model transition you're likely to see. We are at an inflection point. The number of big cloud native deals we're announcing on Ascendon has really bumped up. I mean we announced Telenor, we announced Lyse a few quarters ago, we announced M1 in Singapore. We announced one of the largest banks in Australia. We announced Claro Brasil, Formula 1, a lot of others. For a long time, we've been waiting for the market to be willing to run their core monetization in the cloud. That time is now. And so you're going to see both more win rates as we deploy those with great value and help them become true digital operators and lower their cost to serve meaningfully and make it easier to do business with their end customers, we think this is a trend that has huge upside for us over a two to five year period. Obviously, when it's pure SaaS and recurring ARR, it sometimes then takes a little longer to grow, but then it keeps on giving with high gross margins and everything else. Maybe, Hai, you could talk more about the geographic trends.

Yes. And I think that's right. I think what we're seeing is that we're in the midst of that transition as a business on the global telco side to be more focused on SaaS recurring revenue with higher margins and less reliant on the traditional services deployment model. And as we make that transition, you feel some headwinds to growth on the services side and some tailwinds to growth on the SaaS side. So those headwinds though, what the trade-off we're making is you're getting much greater visibility on the revenues, higher quality revenue because you've got higher recurring revenue. And you're seeing that kind of across -- play itself out across different geographic regions.

Thank you.

Thanks, Dan.

Our next question will come from the line of Shlomo Rosenbaum with Stifel. Please go ahead.

Hi, thank you very much. I'm going to focus just a little on some of the tactical stuff this quarter and next quarter. Just there's a decent revenue step-up even at the low end of the range in the next quarter in 4Q '24. And I was wondering if it's the same thing for EBIT and EBITDA. Was there anything that slipped from 3Q into 4Q? Is there something that you just have specific visibility into over there? If you can just give us a little insight as to where it is. I know there's normally like an $8 million step-up or something like that. And here, we're looking at something like closer to $20 million, I think.

Yes. So Shlomo, thanks for joining us. The answer is yes. When we think about the sequential bridge, there are a couple of things that really play itself out. The first is the payments business. As you recall, the payments business has a little seasonality in it where Q4 is always the strongest quarter traditionally. This year is compounded by the fact that we've made an acquisition on the payment side, right? So you can see a compounding effect with regards to that sequential uplift from Q3 to Q4 more so than you would traditionally. On top of that, one of the things that we highlighted is just some of the timing on the revenue recognition around some of the global telco deployments that we talked about. So some of the timing of that revenue recognition will flow into -- from what would be the middle of the year towards the end of the year as well.

Okay. And then just this, just really nice increase sequentially on the adjusted gross margin. Is that a revenue mix type of thing? Is there something -- was there a particularly high revenue on that nonrecurring Comcast stuff that you were talking about? I was just wondering if you can discuss that a little bit.

Yes. I'd say there's two big drivers and then a smaller driver that we'll see contribute more over time. The smaller driver in Q3 over time is as we continue to grow, we'll garner operating leverage, right? We're controlling our expenses pretty tightly. But the two big drivers is, one, we continue to take action to drive efficiency. So we took some actions earlier this year and then we took some further actions at the beginning of the third quarter, and you're seeing the benefit of that as well. And then the last one is one that you alluded to, which is mix, right? As our higher-margin SaaS business continue to grow faster than the other parts of our business, you're seeing the benefit of the mix.

Okay, thank you.

Thanks, Shlomo.

Our next question comes from the line of Brett Knoblauch with Cantor Fitzgerald. Please go ahead.

Hi, this is Thomas Shinske on for Brett. Thank you for taking my question. Just to piggyback on the last question a little bit. With the top line guidance remaining flat, I guess, can you point to anything specifically you're seeing in Q4? Or I guess, can you provide more details on the specific factors you guys are mentioning that are contributing to the margin expansion, whether it be through AI or cost optimization that gives you the confidence to increase the adjusted operating income and adjusted EPS guidance?

Yes. Hey Tommy, thanks for joining. Yes, like Shlomo called out, even though we're hitting some of these slightly slower revenue periods, if you kind of model out Q4, it does suggest that even on an organic basis we could be at the mid or upper end of our -- the range we're trying to get to in Q4. So obviously we're working hard to deliver a strong Q4. Specifically on the margin expansion, it is a combination, not any one specific. AI obviously is contributing. We're seeing GitHub and the overall productivity at the engineer and R&D level contribute. We're seeing improvement in terms of our self-service by using AI across the board. We see it in various portions of our G&A business, just to constantly invest to get better in terms of what we're doing and to operate more efficiently. So that's, I'd say, more some of what AI is contributing. We're also building AI into customer use cases in our product, both directly and working with partners, that's actually resonating and helping us win higher sales win rates. And so we like what's going on there. But I would say it's an overall mindset that Hai has been talking about. We go back to Q2 of 2022, we ran slow into a slowing period, and we learned from that. And we said we're never doing that again. And we believe we can, at operating scale with higher gross margins, we can kick out a higher operating adjusted op margin, which is why we raised it to 18% to 20%. We're just taking every dollar and either redirecting it to a higher profitability or redirecting it to a higher yield, whether that's sales and marketing, whether that's R&D, whether that's our G&A spend. And that operating discipline is starting to permeate through all parts of our leadership in our business, and it is here to stay. And we think we can do even more in the quarters and years ahead. But it's a mindset, constant quarter turns of the wrench to just constantly be more efficient and generate a higher yield and better cash flow. And obviously, with the transition to SaaS and higher gross margins, that also should contribute to that as well. It's all of the above.

Yes. I think the only other thing I'd add specific to the fourth quarter, Thomas is, as I mentioned earlier, right, we have this compounding effect in our payments business because of the acquisition. And our payments business is higher margin. So you're seeing that this year in a way that's driving more operating leverage than you might have -- would have seen last year.

Perfect. Thanks guys. And then just one more, if I may. Congrats on the extension with Comcast. I guess what specific opportunities do you see over the next six years to expand within that relationship?

Yes. I mean what we've seen is -- I mean, first, Comcast, along with Charter and many of our other customers is innovative and industry-leading as it gets. And so one of the mindsets that I think we've really improved on over the last five or six years, which is a co-invention mindset. They do a lot of great innovation, including software development on their side, and they can leverage some of our great technology. So this mindset which says let's put great people in a room and just think about how we can make it better. Obviously, we don't support them on the wireless stage today. A competitor of ours does that. We try to every day show them with our great wins in wireless all around the world that if they ever wanted to consolidate, like they consolidated 11 million subscribers in triple-play billing a few years ago off that same competitor, we think we could bring them value. Will that materialize? Time will tell. But obviously, that's one that we would love to do more business. They're doing a lot in the content and the digital brand space with their Comcast NOW and others. Obviously, we support some of those various use cases, and we'd love to continue to do even more. So I would just say stay tuned. As long as we bring value, we're mission, we're always up and bringing them more reliability and resiliency and just being easier to do business with, typically it works out well. So I'd say stay tuned.

Great. Thank you.

Thanks, Tommy.

Our next question comes from the line of George Notter with Jefferies. Please go ahead.

Hi guys. Thanks very much. I have a question on the CX and payments businesses. I think in the past you guys have talked about them in the context of Rule of 40 businesses. I guess I'm curious if that's still the case. And then also, I saw from the presentation, I think the two businesses in aggregate are, I guess I should be careful here, your non-cable, non-telco business is about 30% of sales. And I think year-to-date is what the presentation references. I assume that's also true for Q3. Any insight there would be great?

Yes. I think on a Q3, you probably see it in the detail, it's 29%. A little bit of timing just -- but we see strong growth across the board. Last quarter, we were 31%. But overall, we're progressing at a really nice rate. And we have high expectations and aspirations. We should be able to continue to expand up towards 35% in 2025 and 2026 as we grow into maybe 12 to 24 months out, just a steady progression like we've done the last five or six years. Specifically on the Rule of 40 and growth, we continue to see extremely strong growth, strong double digit, strong double digit in the CX business. It's data-driven, it's multi-vertical, and we are just ringing the cash register for great brands with this solution. And we're starting to also cross-sell it more into our existing telecom and cable base in addition to these big new verticals. So that one continues to perform well. And yes, is in the double-digit and Rule of 40 category that I could provide more if he wants to. On the payments, what we've talked about on that side is a double-digit business. We saw for a quarter or two that slide back down into high-single digit, but fully expect that. We think that's more timing. As Hai talked about, typically Q2, Q3 a little more seasonality, but we love what we're seeing in the business overall and expect it to be a strong double-digit over the medium to longer term. And I think what we talked about last year for that individual piece, it was just slightly below. It was more in the Rule of 30s range, and that's kind of where that business is operating. Hai, is there anything else you want to add on that?

No, I think that's right. I think the expectation is that the slowdown on the -- organic slowdown on the payments is temporal in nature. And so as we kind of look to next year, we still expect that business to get back to double-digit organic growth.

Got it. And then just as a quick follow-on there. Can you just remind me the M&A contribution in these businesses? I think iCG Pay, and then I think you had another acquisition in the insurance vertical. But can you remind me how much revenue comes from those deals in 2024?

It's roughly $6 million in the quarter.

In '24. Okay. Great.

How much?

Yes, '24. Yes, it's high-single digits in for the full-year. I'll get you that number, but it's specifically $6 million for the quarter.

Q4. Got it. Okay. Got it. And then I think both those deals are around midyear in terms of when you close them. So loosely, we can scale it up for next year another probably $6 million, $8 million, I would imagine, in terms of next year's contribution.

Yes, you're not that far off.

Okay. Super. Thanks guys. Appreciate it.

Thanks George.

Our next question comes from the line of Matthew Harrigan with Benchmark.

Thank you. I guess this is more or less the tertiary piggyback off Shlomo's questions on margins and efficiencies. And I'm sure that you're not going to hire Elon Musk after -- as your efficiencies are, after you guys lays off 80% of the total workforce. But can you give any more specificity on your cost composition in terms of labor and such? And also, it seems like there's such a high level of familiarity between yourselves and Comcast and Charter. I'm sure they understand the economics of your business. And to some extent, those long-term contracts, they are probably somewhat of a gating function on your margin increases given that that's still a heavy chunk of revenues. But is it natural to think that as you hopefully go even beyond 35 and Xponent really continues to grow, you're just going to see a pretty continual reset, upward reset on that margin creep even if it's always gated somewhat by the great relationships you have with Comcast and Charter?

Yes. I think there's a couple. Matt, I hope you're doing well. Thanks for joining. I think there's a couple of different concepts in there. First, when we elevated our range to 18% to 20%, we absolutely expect in 2025 and 2026 and beyond to be in that range. That would be point one. And we love what we're seeing in the business and our ability to deliver against that aspiration. Secondly, it's -- we think that there can be this consistent quarter turns of the wrench to just constantly get better in the -- over a several year period, we would not expect to be hovering at the low end of that range. We would expect to be progressing through that range quite nicely. Obviously, it won't be 100% linear, but 20, 30, 40 basis points improvement is we think can be generated on a fairly consistent basis, even if not a 100% linear from all those factors we've been talking about. And part of the good renewals and the position we're in with our big two or three and some of the other big customers is partly we're reaping the benefit of that from the R&D we invested in 2018, 2019, 2020, early parts of this decade is we've now made those investments. That's bringing them huge value, and it can actually then generate nice profitability for us. And it's a win-win for both of our customers and for us. So we don't see any of our customers necessarily as a drag on our ability to expand operating margin. Just like they do in their business, if you invest well and you innovate well, typically you're rewarded on both top line and bottom line. And that's how we're trying to build our business model with this product-based approach.

Great. Thanks, Brian.

Thanks, Matt.

Our next question comes from the line of Nehal Chokshi with Northland Capital Markets. Please go ahead.

Yes, thank you. Of all the non-Comcast wins signed in the quarter, and then separately year-to-date, can you give a sense as far as what's the annual contract value of these signed? I recognize that a lot of these are to ramp over the future quarters. So just getting a sense of what that annual contract value is and thus why it will drive towards the midpoint of your long-term growth?

Yes, hey, Nehal. I hope you're doing well. We don't provide the ACV. I guess we'll take that under advisement if we decide to disclose that in future quarters. Those wins, to be clear, that we shared on the slides were Q3 year-to-date. They were not just Q3 wins. I think we called out in some of the commentary, the wins that we did have in Q3 specifically. But overall, when we look at the performance on both an annual contract value, ACV, and a total contract value, TCV, standpoint, we track both in our sales methodology. We're performing well this year, and we like where we are in our ability to do it. So I think those are some of the factors, including the renewals, including some of the volume expansions in some of the business areas that we have that are more SaaS in nature that contribute to why as we work through this several quarter kind of just slower growth period, what gives us the confidence to get back to that midpoint 4% or higher organic growth going forward.

Okay. And then, Hai, you're raising adjusted EBITDA for calendar '24, but not free cash flow. Walk us through why that is?

A big chunk of that is because as you recall, and then as I mentioned, we've taken some difficult decisions to drive efficiencies. And as a result of those difficult decisions, what you have is you end up with restructuring charges that are cash in nature, right? And that's a headwind to free cash flow. So it's a near-term headwind to free cash flow. Over the long term, it will be a tailwind to free cash flow.

Got it. Understood. Thank you.

We'll take our final question from the line of Maggie Nolan with William Blair. Please go ahead.

Thank you. On the increase in margin guidance, none of the levers that you outlined were necessarily incremental to what you've spoken about in the past. So is there any more detail you can share with us on what specifically surprised you to the upside to allow you to increase guidance? And maybe what is the magnitude of each of those levers in the future that would drive you into that 18% to 20% range?

Yes. I think, Maggie, I think the -- it's not so much what surprised us. I think it's us hedging the timing, right? Like when you take some -- you make some difficult decisions, we need time to really think through the ripple effects of those decisions. And so where there was uncertainty, there was uncertainty around timing and how much of that we'd be able to realize this year. I said as we got through the third quarter, we were able to execute on it faster than we originally thought we might. I think, hence, the benefit we're feeling in year to some of those actions that we're taking, right? And so that's really more context. As we look to next year, right, part of it is kind of that continued discipline. I think there's more opportunities for us to continue to drive efficiencies in the business across all of our businesses, plus mix will come into play quite meaningfully. And then lastly, at some point, when you think about kind of the SG&A piece, there can be some meaningful operating leverage as we continue to grow our higher margin business.

Thank you. And then as you think about further diversifying the revenue base, the other vertical in particular, are customers within that vertical coming to you and asking for vertical specific knowledge or offerings or solutions? And do you have the ability to kind of tailor that as you attempt to continue to scale those end markets?

Yes. No, it's a great question, Maggie. I mean, as we gave some color commentary, the fact that we focus on that post purchase digital customer engagement, you see a lot of similarities across, which is what gives us the credibility and why we are ranked as a leader in multiple quadrants. And so I think that is what's driving a big chunk in the win rate. But then, yes, as we do more in financial services, we do work with three of the largest pharmacy retailers as we do more in insurance and big tech, we are starting to build in more industry vertical-specific domain that is helping us actually scale those verticals out and then look for add-on cross-sell and upsell. And the nice thing about these SaaS solutions is typically, we can get in with a great ROI that rings the cash register for them with a quick payback with anywhere between $0.5 million and $2 million. So it's a relatively cost effective entry point from a price and then we can expand those extremely quickly as we deliver value. And so we're not limited by the fact that we haven't had decades of experience in those verticals, because we do know the targeted value props, but then we're starting to build out those domain expertise as well.

Thank you.

Thanks so much, Maggie.

And with that, I'll turn the call back over to Brian Shepherd for closing remarks.

Thanks, everyone, for joining. Hopefully, you see why we're excited about what's going on in the business, 11% year-over-year growth in adjusted operating margin, 15% year-over-year growth in EPS, 25% year-over-year growth in free cash flow, and we think we can do better. We're proud of the quarter. We're going to continue to work on delivering greater value and improved results in the quarters and years ahead. Look forward to seeing you and talking to you next quarter.

That will conclude today's meeting. Thank you all for joining. You may now disconnect.