Good morning and welcome to Mondelēz International Second Quarter 2017 Earnings Conference Call. Today's call is scheduled to last about one hour, including remarks by Mondelēz management and the question-and-answer session. I'd now like to turn the call over to Mr. Shep Dunlap, Vice President, Investor Relations for Mondelēz. Please go ahead, sir. Shep Dunlap - Mondelēz International, Inc.: Good morning and thanks for joining us. With me today are Irene Rosenfeld, our Chairman and CEO; and Brian Gladden, our CFO. Earlier today, we sent out two press releases and presentation slides, which are available on our website, mondelezinternational.com/investors. During this call, we'll make forward-looking statements about the company's performance. These statements are based on how we see things today. Actual results may differ materially due to risks and uncertainties. Please refer to the cautionary statements and risk factors contained in our 10-K and 10-Q filings for more details on our forward-looking statements. Some of today's prepared remarks include non-GAAP financial measures. Today, we will be referencing our non-GAAP financial measures unless otherwise noted. You can find the GAAP to non-GAAP reconciliations within our earnings release and at the back of the slide presentation. And with that, I'll now turn the call over to Irene. Irene B. Rosenfeld - Mondelēz International, Inc.: Thanks, Shep, and good morning. By now, I'm sure you've seen our two press releases, and you're all Googling furiously. So before we discuss our second quarter results, let me take a few minutes to talk about my decision to retire and our plans for CEO succession. In 2006, when I became CEO of Kraft Foods, it was about to become an independent publicly-traded company. We were a U.S.-centric conglomerate with a vast portfolio of undersupported brands in a wide variety of categories. Over the last decade, we…

Our first question comes from the line of Bryan Spillane with Bank of America.

Good morning, everyone, and congratulations to you, Irene. Irene B. Rosenfeld - Mondelēz International, Inc.: Thanks, Bryan.

I guess, my question is just related back to the North American biscuit category. I guess everything you see is that snacking in general is still growing, yet the category is sort of lagging snacking growth in North America. So Irene, can you sort of just give us some more color in terms of where you think the category is missing? Is it not channel diverse enough? Is it losing share to other snack options? Just trying to understand really why the category seems to be lagging overall snacking in North America. Irene B. Rosenfeld - Mondelēz International, Inc.: Yeah. Bryan, we talked about this at CAGNY. And frankly, we've been looking at this for quite some time. I think it starts with the fact that we're seeing price deflation and erosion in promotion effectiveness in a number of markets but particularly acute in the U.S. And I think you probably have heard that from many of our competitors. In response to that, we are progressing our revenue management activities to continue to find those places that we're getting the best return, to work with our customers to understand the ROI of some of the various promotional practices that are going on. And frankly, I do believe that U.S. food deflation will begin to stabilize later this year. The second one is that we are seeing continued shifts toward health and well-being products. And again, as we've talked on a number of occasions, we're taking significant steps, both in terms of renovating existing brands with things like organic Triscuits, belVita Protein, RITZ Crisp & Thins as well as totally new products like Véa, which we just are in the process of introducing into the marketplace. And we believe that will help to not only improve our share position, and it's a big part of our back half share recovery, but we also think it will ultimately stimulate category growth. And then lastly, there is a piece that is non-measured channels. Again, primarily e-commerce, which in snacks is a fairly small piece of the business, but it's also natural food stores and other places where the consumer is shopping and once again, it's one of the reasons we have chosen to focus our efforts so much as we complete our supply chain reinvention on having the flexibility to introduce different package formats and different package sizes so that we can be present in whatever channels the consumer is shopping. So net-net, we are seeing continued category declines. And in fact, as Brian said, it got a little bit worse in the second quarter, but we have great confidence as we look to the back half of the year, particularly a number of the actions that we're taking that will start to see that category recover.

Okay. Thank you.

Our next question comes from Andrew Lazar with Barclays.

Good morning, everybody. Brian T. Gladden - Mondelēz International, Inc.: Hey, Andrew.

Irene, congratulations as well from me on your decision. Irene B. Rosenfeld - Mondelēz International, Inc.: Thank you.

Two quick questions. First just the first one around Dirk, I know he doesn't start till November. Mondelēz, obviously, has a 2018 margin target. You've got an expectation that margins can further improve in the years thereafter. I'm sure any new CEO candidate is going to do their due diligence around the certain targets that are out there, whether they be revenue or margin oriented. But I mean, could we have confidence, I guess, that Dirk is sort of fully bought in, if you will, and supportive of the kind of margin targets that are already out there? Or do you think there's still a need for a new CEO to come in and do his or her own sort of more in-depth analysis in the seat, and that those things are all potentially subject to change? And then I've just got a follow-up. Irene B. Rosenfeld - Mondelēz International, Inc.: Well, I think there's no question. It's too early to speculate on what Dirk might do as he gets fully on board. But what I will say is, he's very familiar certainly from having done his own due diligence about what this company's progress has looked like, and what our aspirations are. And quite frankly, as I said, one of the reasons that we selected him as our leader is the fact that he has a very proven track record of being ambidextrous, as I call it, walking and chewing gum, top line and bottom line, and it's actually quite an impressive set of results. So he's a seasoned CEO. He knows well the challenges that one needs to make on the top line and the bottom line. And again, he's got a proven track record in that area. So, I have great confidence that he will come in here. Obviously, he wants to learn and form his own opinions, but I feel quite comfortable with the targets that are laid out.

Okay. Thank you for that. And then, just to follow back up on North America biscuit, obviously the competitor DSD transition is one of the things that you pointed out that will help improve biscuit trends in the back half of the year. And you mentioned some incremental display and shelf gains. Now that we're a little further into this process, I was wondering if there were any maybe more specific metrics you could share along those lines. Because I guess when it was initially announced, Mondelēz was certainly pretty excited about the potential opportunity. And maybe it's just me, but it seems like more recently, some of the commentary from the company has been a little more along the lines of, well, we'll see if we get a benefit. If not, we can always rethink things, too. And I'm just trying to think maybe it's more the way I'm reading into it than it is reality. But any color you can share around some of the metrics about the type of gains maybe you'd expect might be helpful there? Irene B. Rosenfeld - Mondelēz International, Inc.: Andrew, we feel every bit as confident and optimistic about the opportunity that our competitor's exit presents us with. For competitive reasons, we've been reticent to get into a lot of the specifics, but I will tell you we are seeing early success, and part of the challenge is we've been talking about this for quite some time. They announced six months to nine months ago, and we told you what we were going to do, and now we're actually about doing it. So, we have every confidence that we will pick up incremental shelf space, incremental displays, and it will be a key contributor to the trajectory change on our North American business in the back half of the year.

Great. Thank you. Brian T. Gladden - Mondelēz International, Inc.: And I think, Andrew, as you look at some of the July data, it will be a little messy because of some of the malware shipment timing issues. But again, at the individual retail or account level, we feel very good about the progress. Irene B. Rosenfeld - Mondelēz International, Inc.: I guess the other point is, Andrew, it is an expensive capability, and so we want to be clear with our shareholders that we will be prudent as we continue to leverage this asset to make sure that it's giving us a good return. So that's the context in which you might have heard us refer to that.

Great. Thank you.

Our next question comes from Chris Growe with Stifel Capital. Christopher Growe - Stifel, Nicolaus & Co., Inc.: Hi, good morning. Brian T. Gladden - Mondelēz International, Inc.: Hey, Chris. Christopher Growe - Stifel, Nicolaus & Co., Inc.: I wish you well, Irene, in your retirement as well. In relation to revenue growth, as I think about the organic revenue growth, the improvement required in the second half of the year, I guess, I wanted to understand where you're seeing some strength in the business? I heard you, Brian, mention some better emerging market performances kind of shaping up there. I'm just trying to understand where you're seeing that improvement that will help us get a better feel for the second half improvement in revenue growth? Brian T. Gladden - Mondelēz International, Inc.: Yeah. Look, you're talking globally? Christopher Growe - Stifel, Nicolaus & Co., Inc.: Globally, and I realize that the malware incident, you have some benefit in Q3. I get that. I was thinking more about the underlying business, if you will, and how it's improving. Brian T. Gladden - Mondelēz International, Inc.: Yeah, look, there's no question as we think about the second half. So you can do the math on what we need to do in the second half to get to at least one. That's still – we need a good second half. The malware incident has created a headwind, and I would say it does make that target a little bit tougher as we talked a little bit about some of the third quarter challenges. But I'll give you a few reasons to believe that we feel good about the second half. Three of our four regions are actually executing well and don't really need a significant change in trajectory as we look at…

Our next question comes from Ken Goldman with JPMorgan.

Hi, and Irene, best wishes to you from me as well. Brian T. Gladden - Mondelēz International, Inc.: Hi, Ken.

Irene, it's a little backward looking of a question, and you highlighted many of your accomplishments over the years, and clearly, you've helped create a lot of value for shareholders. But everyone has decisions we wish we could change. I always find it interesting to sort of ask outgoing leaders. As you look back on your career running Kraft and Mondelēz, are there any choices that stand out that you made that maybe with 20/20 hindsight you would have done slightly differently? I always find that informational. Irene B. Rosenfeld - Mondelēz International, Inc.: Yeah. No, I think it's a great question. Actually as I have had a chance to reflect on the last decade or so, I'm quite proud of a number of the things that happened. I think the portfolio decisions probably are kind of at the top of the list. I'm proud of the pivot that we made in response as we launched the company, the pivot that we made to more aggressively go after cost and improve margins. And I think in hindsight, I think perhaps we could have gone after the costs a little faster that would have helped us to be able to have the fuel to invest in our growth a little bit sooner. But I actually think that one of the things that I'm most proud of is having been able to balance the long-term and the short-term and the flexibility to pivot as we did in 2013, 2014 as we jump-started ZBB and supply chain reinvention and our Mondelēz Business Services to allow us to deliver the margin expansion. So, I think my regret is that we haven't fully realized the potential on the top-line, and I have every confidence again as I hand the reins over to Dirk and we look at his track record that, that is the last piece of the puzzle here.

Thank you. And then a quick follow-up for me. Can you talk about the board's decision? I know you mentioned what Dirk's qualifications are, and certainly, he's had a good bit of success at McCain, but can you talk about the board's decision to go outside the firm to identify the next CEO? Typically, there are internal candidates at the senior level who are interested in these kind of jobs. So how do you think about that? And frankly, how is the team and the board managing the morale of the top internal candidates who maybe, to be frank, are slightly disappointed right now? Irene B. Rosenfeld - Mondelēz International, Inc.: Yeah. Over the last couple of years as I talked with the board about my plans and my timeline for retirement, they put in place, as you would expect, a very thorough multiyear process. And in that process, the board considered both internal and external candidates, and there was a very talented pool of both internal and external candidates. I'm very pleased with the choice of Dirk and for all the reasons that we've laid out, and I feel quite confident that he will work hand in glove with our senior leaders to deliver on the commitments that we've made.

Thank you.

Our next question comes from Alexia Howard with Bernstein. Alexia Jane Howard - Sanford C. Bernstein & Co. LLC: Good morning, everyone. Brian T. Gladden - Mondelēz International, Inc.: Hi, Alexia. Alexia Jane Howard - Sanford C. Bernstein & Co. LLC: Wishing you all the very best for the next chapter, Irene. Thank you. Can I ask about the gross margin outlook? It feels as though the gross margin progression has been pretty flat recently, I guess, certainly this quarter. The commodity outlook, I mean, dairy's obviously a problem at the moment. Will you get some relief at some point perhaps on the cocoa side? And then can you talk specifically about the pricing environment? Particularly here in North America, we're hearing that a lot of the retailers are getting pretty aggressive on pricing, pushing private label. I know that's not a huge issue in confectionery, but it may be in cookies and crackers. So maybe just a few comments on the gross margin outlook, and I'll pass it on. Thank you. Brian T. Gladden - Mondelēz International, Inc.: Sure, Alexia. Yeah, I mean, gross margins were down slightly in the quarter, and that's sort of the trend we've had over the last few quarters. The net productivity, the supply chain reinvention work is executing well. We're delivering strong net productivity. So that's not the challenge. I would say, clearly, we lost some volume leverage in the quarter as it related to the malware issue, and the pricing dynamic, pricing in general was positive, and the reality is most of that was driven by some of the inflationary economies like Argentina and Egypt, Nigeria. Those are big, big drivers where we had significant pricing. There's a couple of places where we have seen trade spending and incremental pricing challenges. You…

Our next question comes from Jason English with Goldman Sachs. Jason English - Goldman Sachs & Co.: Hey. Good morning, folks. Congratulations, Irene, for your pending retirement. I hope you have ample time to enjoy it in the years ahead. I guess I want to come back to the top line growth and what you're highlighting for category growth. You're footnoting a lot of brick-and-mortar data with Nielsen, which I think we all know is sort of imperfect. If we marry it with Euromonitor data and try to replicate your analysis, it yields a different conclusion, that your end markets are growing something closer to a bit north of 4%, which is slower than historical context, but a lot better than the bit north of 2% that you reported last year. I mean, there's flaws in both data sets. But as you contemplate what's not captured in Nielsen, do you think Euromonitor may be a more accurate prediction? Or structurally, do you really think your categories are slowing so much so rapidly? And what does it mean for the long term? Irene B. Rosenfeld - Mondelēz International, Inc.: So Jason, I think the growth is closer to 2% than it is to 4%. I'm not quite sure how you've put those numbers together. And it is slower than certainly than the rates that we would have seen a number of years ago. But I think we've set our expectations properly. I think we've got a good sense of category growth. We've been focused disproportionately on our share growth. I'm delighted to see our shares stabilizing as we come out of the second quarter. And we are very focused on our pipeline of innovation and renovation to help to continue to drive our overall share performance. So I think in the…

Our next question comes from Robert Moskow with Credit Suisse. Robert Moskow - Credit Suisse Securities (USA) LLC: Hi, thanks for the question. And best wishes, Irene. Hey, Brian, I think when we met a couple of months ago, you said that you had a whole war room set up to try to plot a strategy for the second half for Nabisco and DSD, but I was hoping you could give us some numbers on any kind of distribution gains that you've achieved? You mentioned it qualitatively. But is there anything you can help us with when we watch the Nielsen data come through as to what kind of ACV to expect or just roughly how many customers you've made gains with? Brian T. Gladden - Mondelēz International, Inc.: Yeah. I think, Rob, it's still just a little bit early. I hope you can sense our optimism and positive energy around it. I think, clearly, we're in the middle of shelf resets now, and you'll start to see that play out as you move through August and into September. And as I said a little bit earlier, there is a bit of noise because of some of the shift in timing and what played into July, and how that may have affected some of the shelf resets, and we're working through that now. But I'm not going to provide details. I mean, obviously, there's a competitive sensitivity to sharing some of that data as well. You'll see it play out, but I think it'll play out as you get through the third quarter into the fourth quarter, I think it'll be much clearer in some of that reported data. That's what I would say. Robert Moskow - Credit Suisse Securities (USA) LLC: So your confidence then, Brian, is because you have commitments like verbal commitments from customers to make these changes? Brian T. Gladden - Mondelēz International, Inc.: In many cases, yes. Robert Moskow - Credit Suisse Securities (USA) LLC: Okay. Thank you.

Our next question comes from John Baumgartner with Wells Fargo.

Good morning. Thanks for the question. Brian T. Gladden - Mondelēz International, Inc.: Hey, John.

Irene, you mentioned your belief in gaining market share in a 2% growth category and, I guess, what stands out is maybe your distribution model in China, which enabled gum success, and now we're seeing it again with Milka. How unique is your route-to-market in China and its ability to leverage multiple categories? And how should we think about your other routes-to-market either by category or geography where the structure may be allows you do more in terms of cross-selling, like where are you not fully maximizing your potential at this point? Irene B. Rosenfeld - Mondelēz International, Inc.: Well, I think, John, it's actually – our route-to-market in China is somewhat unique relative to other markets. But frankly, the success that we've had with gum and now in chocolate is simply the playbook, which is that we intend to have all of our categories available in all of our countries. And so as we think about the emerging markets, most of those countries are dominant single category countries. And slowly but surely, we are bringing our brands into those white spaces, and so chocolate in China is a good example. The opportunity to bring chocolate here to the U.S. is another example. It's not about the nature of the route-to-market. Frankly, it's our investment in the feet on the ground that allow us to have the reach into broader parts of the country. So the investments that we're making in all of our geographies are designed to give us the infrastructure in Brazil, in China, in India, and South East Asia that will then allow us to put all of our categories through that pipe. So we have great visibility and optimism about the runway of growth opportunities that will come from the introduction of all of our categories into what is white space for us in a number of markets.

And just as a follow-up, in terms of where your resources stand today, what's your ability to get to achieve that with organic resources as opposed to anymore externally on M&A? Irene B. Rosenfeld - Mondelēz International, Inc.: As we've said, we feel very good about the overall composition of the portfolio and about our reach. We are well positioned certainly in the BRIC markets and in a number of the second-tier markets, but we will continue to look for opportunities to supplement that portfolio as we did in Vietnam, with our Kinh Do acquisition. So in that case, we had a business in Vietnam. It was fairly small. We instantly became the number one snacking company in that country with the acquisition of Kinh Do. So we will continue to look for opportunities to supplement our basic footprint, but we feel quite good about the overall footprint and approximately 40% of our revenue that is in emerging markets.

Great. Thank you very much.

We have time for one final question. Our final question this morning comes from Steven Strycula with UBS.

Hi. Congrats, Irene, and Brian, you never showed me your DSD war room. So next time I come to Chicago, I want to see it. But... Brian T. Gladden - Mondelēz International, Inc.: (52:18)

All right. Two questions. First one is for Irene for chocolate production. With cross-border taxes being less of an issue going forward, how do you think about freeing up extra capacity locally to feed the U.S. marketplace? And can you speak to some of the success you've had already with the Oreo and Milka launch? Brian T. Gladden - Mondelēz International, Inc.: Is that chocolate specifically, Steve, or just broadly?

Yeah. Specific to chocolate. Brian T. Gladden - Mondelēz International, Inc.: Yeah, So one of the things I said in the prepared comments was we have added capacity that that's come online even in the last few weeks, and we now have the capability in the U.S. to accelerate some of our distribution expansion. So you'll see a broader footprint and a bigger market position for Oreo, Milka as that capacities come on. It's not U.S. based capacity. We will likely, as this business grows and we continue to invest, need to have a discussion around where we put incremental capacity beyond that, and that's something that we probably phase into within the next probably 12 months as we think about that business. But we're not there yet, and we've got plenty of capacity to drive the growth that we have for the second half and into next year.

Okay. And then, Irene, for emerging markets, I've heard other CPG companies with more global footprints talk about losing share to local brands in markets like Brazil, similar to what's happening in biscuits right now. What is key to kind of reaccelerating volume and taking back market share in places like Brazil or even Russia? Is it really coming out with more affordable price pack architecture? Or just maybe even launching new brands that are more geared to the lower income demographic? Could you kind of speak to how we kind of accelerate in those markets? Irene B. Rosenfeld - Mondelēz International, Inc.: Yeah, and it's exactly what you said. It is the fact that we are seeing, particularly in challenged economies like Brazil, we are seeing that value pricing is very important to the consumers there. And one of the things that's been a big focus of ours as we have implemented our supply chain reinvention is the opportunity to have more flexible packaging formats available, so that we can provide our products in a variety of packaged formats at different price points. And so the key for us in competing in, particularly in the emerging markets, with a number of lower-priced local competitors is our ability to create smaller pack sizes of our existing products, and we're finding that is working quite well for us, and that will be a key source of our share gains – they are actually today a source of share gains and will be increasingly important as we look ahead.

Great. Thank you.

Ladies and gentlemen, this will conclude the Mondelēz second quarter 2017 earnings conference call. You may now disconnect your lines.