Ladies and gentlemen, thank you for standing by, and welcome to the TE Connectivity Third Quarter Results Conference Call. [Operator Instructions] And as a reminder, this conference is being recorded. I would now like to turn the conference over to our host, Keith Kolstrom, Vice President of Investor Relations. Please go ahead, sir.

Thanks. Good morning, and thank you for joining our conference call to discuss TE Connectivity's third quarter 2013 results. With me today are Chairman and Chief Executive Officer, Tom Lynch; and Chief Financial Officer, Bob Hau. During the course of this call, we will be providing certain forward-looking information, and we ask you to review the forward-looking cautionary statements included in today's press release. In addition, we will use certain non-GAAP measures in our discussion this morning, and we ask you to review the sections of our press release and the accompanying slide presentation that address the use of these items. The press release and related tables, along with the slide presentation, can be found on the Investor Relations portion of our website at te.com. [Operator Instructions] Now let me turn the call over to Tom for some opening comments.

Thanks, Keith, and good morning to everyone. If you would please turn to Slide 3. Q3 was a good quarter for the company. Sales and earnings exceeded the high end of our guidance range, and we had another terrific cash flow quarter. Orders were $3.4 billion for the quarter. Excluding our SubCom business, orders were up 2% versus last year, and book-to-bill was 1.02. Book-to-bill was over 1 for the third quarter in a row, and was at or above 1 in every one of our segments, excluding SubCom. This is the third quarter in a row of year-over-year quarters growth. Sales of $3.45 billion beat the high end of our guidance due to continued strength in the transportation market and improvements in the telecom market. In addition, due to project timing in the telecom market, we did benefit in Q3 from about $20 million of revenues that we originally expected to hit in Q4. We expect total company revenues in the second half to be up about $25 million versus the guidance midpoint we gave in April. Adjusted operating income margin was 14.8%, up 80 basis points versus the prior year and up 120 basis points sequentially. Adjusted earnings per share of $0.88 was $0.06 above the midpoint of our guidance due to the stronger sales and continued strong productivity performance. Free cash flow was $431 million, and we returned $314 million to shareholders in dividends and share repurchases. For the fourth quarter, we expect sales in the range of $3.30 -- $3.35 billion to $3.45 billion and adjusted earnings per share in the range of $0.88 to $0.92. This represents approximately 1% year-over-year sales growth and 18% year-over-year EPS growth. We now expect full year adjusted EPS of $3.20, at the midpoint of our guidance. This is up…

Thanks, Tom. Good morning, everyone. Let me discuss earnings, which start on Slide 9. Our GAAP operating income for the quarter was $439 million, which includes restructuring charges of $67 million and Deutsch acquisition-related charges of $3 million. We continue to expect approximately $275 million of restructuring charges for the full year and a substantial reduction in the level of restructuring actions next year. Adjusted operating income was $509 million, with an adjusted operating margin of 14.8%, up 80 basis points from Q3 last year. Adjusted EPS were $0.88, and GAAP EPS were $0.79 for the quarter. GAAP EPS included $0.11 of restructuring and other charges and $0.02 of income related to tax items. If you'll turn to Slide 10, our adjusted gross margin in the quarter was 32.8%, which was the highest level since separation. This is a 180-basis-point increase versus the prior year and about $50 million less in sales. The increase is largely due to continued progress in our TEOA or Lean programs driving increased productivity, with reductions in both material and conversion costs and improved profitability related to the integration of Deutsch. Total OpEx spending was $623 million for the quarter, up $27 million versus the prior year, primarily due to several nonrecurring expenses during the quarter. In the right side of the slide, details of the items of the P&L below the operating line. Net interest expense was $32 million in the third quarter, and I expect approximately $32 million of expense in the fourth quarter. Adjusted other income, which relates to our tax sharing agreement, was $10 million and largely in line with guidance. The adjusted effective tax rate was 23.6%, in line with our guidance of 23% to 24%. And in the fourth quarter, I expect other income of about $8 million and…

Thanks, Bob. If you could please turn to Slide 12. Based on the order trends we've been discussing, we expect revenue in Q4 to be in the $3.35 billion to $3.45 billion range and adjusted EPS in the $0.88 to $0.92 range. This strong performance would result in adjusted EPS being up approximately 18% versus the prior year due to increased sales, improved productivity, cost reductions and our share repurchase program. Revenue is expected to be up 1% at the midpoint of our guidance due to continued strength in Transportation. And the important thing here is this is the first quarter of year-over-year sales growth since FY '11. Please turn to Slide 13. For the full year, we expect sales in the range of $13.2 billion to $13.3 billion and adjusted earnings per share of $3.18 to $3.22. The full year midpoint assumes revenues about flat versus the prior year, adjusted operating margins of about 14% and adjusted earnings per share growth of approximately 12%. Second half adjusted earnings per share would be up about 15% versus the prior year on flat sales. Our adjusted EPS outlook is up compared to what we guided last quarter, due primarily to the strong Q3 performance. For the full year, we expect free cash flow of about $1.5 billion and a return in excess of $1.2 billion of capital to shareholders. A few final comments before we go to Q&A. I'm really pleased with the execution momentum we are building. Our team around the world is doing a very good job of navigating through the economic uncertainty, focusing on our customers' short-term and long-term needs and delivering strong earnings and cash performance. And I emphasize the long-term needs because we continue to invest alongside of our customers. Our adjusted operating margins are near 15%, and I'm confident we'll reach this level at about a $14 billion to $14.5 billion revenue run rate. This -- our annual free cash flow continues to run about 10% of revenue and gives us attractive choices. It enabled us to become a world leader in fiber optic connectivity, with the acquisition of ADC, and in harsh connectivity, with the acquisition of Deutsch. We've also increased our engineering and R&D investment to approximately $700 million per year in order to strengthen our technology and product pipeline across our businesses. And last but certainly not least, the substantial cash flow has enabled us to consistently raise our dividend and return close to $4 billion through share repurchase in our first 6 years. In total, we have returned over $5 billion in dividends and share repurchases to our shareholders since fiscal year 2008. TE Connectivity has a very strong business foundation, and we expect to deliver improved growth as the global economy recovers. Electronics continues to proliferate, and this requires more connectivity. And at TE, we're really proud to be the world leader enabling this connectivity. So now let's open it up for questions.

[Operator Instructions] Our first question comes from the line of Amit Daryanani with RBC Capital Markets.

I have a question and a follow-up. First of all, maybe you guys could just touch on the Transportation margins, and it improved by 90 basis points, I think, sequentially to 19.8%. Maybe you could just talk about how much of this expansion was due to mix versus leverage. And then going forward, do you think these margins are sustainable in terms of there's no onetime benefit that you guys may have had in the June quarter?

Amit, to answer the last question, no, I don't -- there weren't any unusual onetime benefits in that business in the quarter. We're really getting the volume leverage and we're getting the operating leverage from cost actions we took several years ago. And we're getting much better in that business at core productivity, which, historically, was not a strong suit but is becoming a strong suit. As far as sustainability, I think an important thing to keep in mind, we're performing very well, but auto production is going to be up 2% to 3% this year, which is the historical average. So there's not a windfall on auto production. It feels a little better than that in the U.S. because the U.S. is up, but Europe and Japan, for example, this quarter -- this past quarter, have been down. So I think this is just many years' worth of improvements in a number of areas and, at the same time, continuing to invest in that business to make sure we stay ahead on the innovation and technology curve.

Got it. And I guess my follow-up, maybe -- I guess, maybe I want to clarify, Tom, we should still be thinking of 25% conversion margins in the Transportation segment, I want to make sure that, that's the right way to think about it. And then the networking side, the 300 basis points of margin expansion you guys had this quarter was much better than what I was thinking. Can you maybe talk about was it always just driven by revenue leverage? Because I think most of that restructuring benefit is supposed to be a fiscal '14 story, so I'm assuming there's more margin expansion left going forward even if revenues don't improve substantially.

Regarding the Transportation 25% fall-through, I think that's the right way to think about it over the cycle. In an up cycle, you might get a little more than that. In a down cycle, you're going to get more negative than that. But on average, we see it at about 25%. In networks, I would say there's 2 pieces: there's the continued improvement in productivity; and we're getting volume. As you know, that segment has -- that's been down for several years now, and we've been hurt by that. And -- but we took advantage of that to continue to tighten up the cost structure. It isn't really from the restructuring we introduced this year or we started this year. That's not going to kick in until next year.

Our next question is from Jim Suva with Citi.

This is Nicholas Jones on behalf of Jim Suva. Could you talk a little bit about what you're seeing in European auto sales as far as like registrations versus production? Because I've noticed your outlook came down another percentage point for the full year outlook.

Well, with respect to auto in Europe, I would say our auto business has consistently strengthened relative to our outlook for the year. It's been partially execution on our part but a better market, generally, every quarter than we expected. In Europe, it's definitely soft. New car registrations were down 6% or 7%. Some think they're bottoming. I hear that. But we do benefit from the fact that we're very strong. We're strong across Europe but particularly strong with the German OEMs, and a significant portion of their business is export to the U.S. and China. So the strength in the U.S. and China is definitely helping those OEMs.

Do you think Europe is kind of stable and going to look up next year? Or is it still going to remain soft maybe for another year or 2?

I would tell you that's hard to call. I think for us, we just stay close to the customers and make sure our lead times are tight. The recent trends and, I think, the industry is calling stabilization somewhat flat to slightly up next year. I don't -- we'll be giving you our view of that in November, when we talk about our fiscal year '14.

And our next question comes from the line of Wamsi Mohan with Bank of America Merrill Lynch.

In the Transportation segment, did you see any pull-in in the China commercial segment ahead of the class 4 emission standards that were supposed to go into effect July 1 for heavy trucks? And how long do you think the strength in commercial persists? Do you see this as sort of multi-quarter from here?

I think there might have been -- not in our revenue, there wasn't any pull-in because we're not that strong in the -- most of the heavy truck business because it tends to be a very local business. That's what's exciting about Euro 4 now becoming the law of the land because that's where our strength really comes to play and the combination of Deutsch and TE over there. So we're starting to see a lift in our orders but no big pickup in our revenue because of an acceleration to kind of get under the wire with the implementation of Euro 4. The heavy truck market, our orders are still pretty robust there and especially in the U.S. So the construction side has been a little bit flat, but I think we're optimistic, given the general direction of the U.S. economy.

So continued strength for a few quarters here, at least?

We certainly have that built into the fourth quarter.

Okay. And Bob, as a quick follow-up, are you baking in any of the margin improvement from lower raw material costs here in your near-term forecast?

Yes, so we have single-digit million benefit in fourth quarter from lower copper, gold and overall raw materials in our business. We are certainly seeing a benefit of the decline that we've seen over the last couple of months.

Our next question comes from the line of Matt Sheerin with Stifel. Matthew Sheerin - Stifel, Nicolaus & Co., Inc., Research Division: Question on the networking business and the margin targets. I know you've talked about getting -- eventually getting back to sort of a mid-teens operating margin. A couple of years ago, you were running at $1 billion of so of revenue a quarter. Do we need to get back to those volumes or will the cost-cutting actions that you're seeing enable you to get there sooner or mix or whatever the other issues?

I would say, Matt, it's in the 3.5 to 4, depending on the mix of the businesses, but we have a better cost structure than we did. And we also have the benefits of the Deutsch synergy -- of the ADC synergies. Of course, right now, we're -- our SubCom business is at a very low point, and it's just a little bit above breakeven. Our telecom business margins are solid in the double digits, so as revenue picks up there, we expect to get a lot of leverage there. So we definitely feel this business, as it gets back to what we historically would define as a more normal revenue level, should be in -- at or around the company average margin. We [indiscernible]. Matthew Sheerin - Stifel, Nicolaus & Co., Inc., Research Division: Okay, great. And then on the Telecom Networks and in Enterprise, on the Enterprise side, are you seeing any signs of reinvestments there? For instance, December quarter into the next year. And then on the Telecom Networks side, are you seeing any signs of life in China in terms of any pipeline there?

On Enterprise, it's mixed. The Enterprise business, in general, over the last several quarters, I'd say it's been going sideways, flips up, goes down. And it's a very, very local business. For example, we're strong in India, and our enterprise market there has been very slow because of the economy. We're doing -- we're number -- middle of the pack player in the U.S., so we're picking up there, particularly in the data center. But overall, I'd say it's pretty mixed and relatively flat. That's how we see it for the next quarter. In the -- your telecom question again? I'm sorry. Matthew Sheerin - Stifel, Nicolaus & Co., Inc., Research Division: Yes, just a bit about your outlook for China recovery and pickup there.

I'd say 2 things: China's slow, and China's a tough market. It tends to be a very low-end market, so that's an area where we've become more selective over the last 2 or 3 quarters. We are really focusing on the mid- to high-end solution where they're available and because we find it super competitive at the low end. And in general, that's how we look at the company. We're staying away from the true commodity space that isn't strategic or necessary to kind of defend the balance of the business.

And we have a question from Mark Delaney with Goldman Sachs.

I was hoping you could elaborate a little bit more on the operating margin comments. I think the 15% threshold, the revenue required to get to that had been $15 billion to $15.5 billion of revenue overall. And Thomas, if I heard you properly, you said $14 billion -- around $14.5 billion now? With the restructuring that you're putting into place that comes into effect next year, should we expect the revenue that you need to get to 15% operating margin to come down further?

I would say that, that includes the $14 billion to $14.5 billion, but we're close. Obviously, we're $14.8 billion in the third quarter, and it's down $1 billion from a year ago due to a couple of things: the margin leverage from Deutsch, the tremendous productivity year we're having, a little bit of business mix right now. For example, Consumer, with 15% of the business last year, it's 12% of the business this year. Some of that's Consumer being down and Automotive being up. So I think we have some of those kind of trends. But I feel confident in the $14 billion to $14.5 billion. Of course, we're not going to put a limit on that, but that's the best way to think of it. And think of it on an annual basis because we have seasonality, as you know. So Q3 is typically our peak quarter in revenue, all other things being equal. We come down a little bit in Q4. Last year we -- our revenue went down 3.5% to 4.5% sequentially to Q4. This year, only 1.5% because of some strength in other business. And then our weakest seasonal quarter is Q1. So when we say 15%, we're talking about a sustained full year of 15%, which means in the peak quarters, we'd be needing to run above 15%. We need to run 15.5%, for example, this time next year to offset what will be a lower-margin first quarter because of the lower sales due to the seasonality.

For my follow-up question, there's been some talk about improved spending on broadband in the U.S., and I'm hoping you can help us understand how well you're positioned to benefit from that.

Sure. We -- as you know, there's been a lot of announcements by the big carriers over the last 6 months and some search companies that are getting new into that business as well about expanding the amount of bandwidth per home. And more recently, just in the last week, another carrier announced a different type of plan where you could, as a consumer or a business, sign up for 500 megabits. One has announced they're going to deliver 1 gigabit. So that is all great news for us if it comes to pass. It tends to drive the whole industry to increased spending. So we did finally start to see a little bit of increased spending in the fiber portion of the network. And in our wireless business, which is still relatively small at about $150 million annual revenue, we've seen a double-digit pickup in the last 2 quarters as the carriers are trying to augment their tower-based network with not quite small cells, but distributed antenna systems. So it feels better than it has in a while for us in terms of spending on our portion of the network. I think there's only a couple of data points yet, so we're not getting carried away with bullishness. But what the customers are saying, we're seeing the amount of RFP activity in the U.S., all definitely feels more -- we're more bullish than we were last year, for sure.

We have a question from Shawn Harrison with Longbow Research.

I had, I guess, a follow-up, first, on the commodities. Assuming the second quarter is kind of where we see commodities bottom out, when would you see the full benefit, would it be the December quarter or kind of the March quarter of 2014 before you would see that fully run through the model?

I think the key to think about is, we have a hedging program in place for our key raw commodities. And essentially, what we do is we look out our demand out 18 months, and we hedge roughly 50% of that demand. So there's definitely a lag in the impact, both negative and positive overall, from commodity swings. So if you think commodities bottomed out in second quarter, it's Q4, Q1 that you start seeing that benefit roll through the P&L.

Okay. And then as a follow-up, we've earlier said that -- Tom, you may have said the operating margin target for Industrial is about 15% in the fourth quarter. I was just wondering if you can confirm that. And then second kind of should that business, with maybe some incremental restructuring gains and some volumes coming through, be operating long-term above 15%?

I'd answer yes on both counts, Shawn. Yes, we did say we expect to be back to the 15% range, and we definitely view that as the business. It should be above average company margins, no question, with a little pick up in revenue, continued improvement in productivity and the benefit of some of the restructuring we're doing.

Is that a business where you would see maybe most of the benefit from a commodity tailwind?

No, I mean, actually, we use the most copper in absolute terms than proportionally in the Transportation business. But industrial does -- will benefit. But there's a lot of copper and precious metal in the Transportation business because of the harsh environment, super harsh environment.

Our next question comes from Mike Wood with Macquarie.

In terms of the Transportation segment outperformance versus the global vehicle production, can you talk about how much of that is being driven by content on passenger vehicles versus the C&I or the Deutsch contribution there? And maybe along those lines if you can talk about whether Deutsch is still on track with that roughly $0.05 a quarter accretion? Or if the better C&I is helping that?

Yes, I would say the performance, relative to production, is kind of all of those things you mention, other than Deutsch is really in the commercial vehicle, so it doesn't play into the light vehicle revenue versus production numbers. But we're benefiting as well from market share gains that we began to get into dine in [ph] shortly after the financial crisis. As you recall, we continue -- despite the significant drop in the auto business then, we made the decision to continue to invest in engineering and R&D and, in some cases, increased our investment. And that's really starting to play out. We won some design wins that usually takes 2 or 3 or 4 years to turn into revenue. And that's clearly helping us. So I think the industry estimates are we've gained 3 points of market share in the last 4 years. We do -- I think we're still gaining a little market share in China as well, even though we have a high market share there. Electronic content mix, I would say it's a little bit higher than norm because of the high-end car sales are a little bit higher than norm. It's not a big number, but we're getting a small tailwind from that. And our overall margin in Transportation is benefiting from just the addition of the Deutsch industrial and commercial business as it was because that was a high-20s EBITDA business and the synergy that we are slightly ahead of plan on the cost synergy. Revenue, although picking up, is slightly below plan. But the -- that overall acquisition is clearly shaping up to be a real winner for us.

And Mike, we are on track to deliver the incremental $0.12 or $0.20 accretion from Deutsch.

And Mike, also -- it's Keith. As a data point, the commercial vehicle business was about $200 million in the quarter, so about 14% of the Transportation segment total.

Got it. Okay. And also on the Subsea business, how far does your backlog take you out there? You're forecasting $110 million next quarter, but with the $20 million quarterly order rate, I mean, is that -- is there risk that, that pulls back down to your trough levels?

Yes, our backlog, as you know, we don't put anything in backlog until we get that first big downpayment and are ready to go into force as we say in that business. So I think -- Q4, we feel pretty good about it. That revenue level, some business needs to come into force to hit the -- to continue that revenue level or move it up. We're encouraged by the fact that there's a lot of programs out there, but that's been the case for a while. A year ago, I would've thought the SubCom business would be higher than it is now. And it's just taking longer to get the funding, but there's some very big projects that we've been awarded that are what I'd call very sensible projects. Sometimes, in this business, you can be awarded a project, but you know it's -- there's a 10% chance it's going to get built. We have several that are well over the 50% chance and the funding is close. So -- but in terms of visibility in backlog, it's a quarter or 2 at max right now. When you hit the boom time, it tends to move out to kind of a year to 5 quarters.

Our next question comes from the line of Amitabh Passi with UBS.

Tom, a question on Network Solutions. We're hearing incrementally from operators focused on upgrading their copper networks to the VDSL2 plus or Vector VDSL. Can you remind us what that means for your business from a content perspective versus fiber to the prem type networks? It seems like there's a bit of a shift towards upgrading copper-based networks versus taking fiber all the way deep into the network.

I think both are going on. But overall, investment in the copper network, almost everywhere, has been consistently declining. One of our strengths is that we have a strong copper business as well. So most -- more than half of our business is in the fiber network. Three years ago, that was different. So we feel we're really well positioned. Our overall growth rate has been down, even though our fiber growth rate has been consistently in the mid-single digits to double digits because of the slowdown in the copper network. So as long as there's investment in the network, we typically feel good about it. In the wired, the Last-Mile, the backhaul, whenever their carriers are making that a priority again, we're going to benefit from that because we have a very -- we really have the full end-to-end fiber and copper network, which nobody has anywhere near both of those to the extent that we do.

Okay. And just as a follow-up, if I look at the operating margin expansion in that segment from roughly 6% to 9%, was that largely all driven by volume? Or would you say structurally, this segment is now at a higher operating margin level relative to where it was a quarter or 2 ago?

Amitabh, there's certainly a benefit from the sequential growth. Sales up, I think, about 10% sequentially. Clearly, we've been doing some significant restructuring. We'll see benefits of that into '14 and '15. We are seeing the benefits of our TEOA and general productivity in that business. I'd say, we certainly feel better about margins at 9%. But historically, 13%, 14%, and we anticipate, in the long run, our Networks segment will be about company average. 6% last year, I think -- or excuse me, last quarter was abnormally low, and we're certainly happy to see the 300 bps improvement sequentially.

We have a question from the line of Steven Fox with Cross Research.

Just a follow-up on that last comment. I was wondering, in terms of some of the restructuring activities in the Networks business, can you just sort of maybe give us an idea of what the actions were that has helped margins, how much was completed or maybe completed towards the end of the quarter that gives you sort of comfort into this quarter as you get the full benefits of that and sort of an idea what's left to do that's important? And I have a follow-up question.

I'd say you have to think about the restructuring in that segment in 3 buckets. Over the last year or 2, most of it has been related to the ADC integration. So that's where most of it was. The -- what we call the legacy TE business was pretty lean in that business. And we knew one of the very attractive aspects of ADC, after their phenomenal product line and strong position in the fiber network was, there was a lot of opportunity to move their cost structure, more like the TE cost structure. So that is largely -- that's the major contributor. With the market being lighter in the last couple of years, we've taken that opportunity to take additional cost out. And then the third piece of the puzzle is the restructuring that's in the works now that will benefit starting next year. So some of that is additional -- what you'd call additional ADC plant, though but we don't -- we're -- we've been together a couple years now, so we don't distinguish that much anymore. And some of it is our Lean programs are really enabling us to put what used to be in 3 plants in 2 plants, along those lines. So there's really 3 pillars to the restructuring piece of it.

Great, that's helpful. And then just as a follow-up, I know you're not giving guidance for the December quarter, but relative to what you're seeing in both your sales and your orders for this quarter, how are you feeling about typical seasonality off of this base? Are there any markets that you feel a little bit better about, a little bit worse about, as you look out towards year-end spending?

When I think about the markets in general, so let's think how we felt 6 months ago, we feel better. A part of that is because 6 months have gone by. But I do think on almost -- most indicators in our business, like we just -- we've talked about in this hour, orders up, book-to-bill up, things like that, are pretty -- are much better than they were a year ago. So if that lasts through the fourth quarter, I think that should -- we should feel better about the first quarter than we did a year ago. But as you know, it was in May of last year, we were feeling, as we guided 15 months ago, about the second half of FY '12 -- May of last year, the orders started to turn down. And it happened across the world, not just in our world. That didn't really turn back up until November. The good news is the order rates are still holding, and we're in the end of July. So I'd say that's a really positive sign, but I'd like to get through the next few months, obviously, before we start talking about next year.

And our last question comes from the line of Sherri Scribner with Deutsche Bank.

This is Kevin LaBuz on behalf of Sherry. My first is on your Consumers side. Could you just talk about what success you've had gaining traction in smartphones and tablets? And I have a follow-up.

Sure. I would say we've had more success in smartphones than tablets. We have a beachhead in tablets; it's fairly narrow. In the last 1.5 year, we've done extremely well with the smartphones designed in Asia. So it's not broad-based, but it's -- we have real momentum there. So in the tablets, not so well there but better in the other tablet area. So it's mixed for us, and it's still relatively small for us. And we continue to be very selective because not all smartphone and tablet business is great business. So that's really been our strategy. I think what I really feel good about and our team feels good about and deserves credit for is we know we can be successful where we target. It doesn't mean it'll happen overnight, but we know we can do the miniaturization, we know we can ramp from 0 to 500,000 parts a week in the way that's required in that market. We know we can be cost competitive and make an attractive margin in the projects we're targeting. So I'd say we feel like we have -- we know we have much better capability in that market, but we're still being selective.

All right. And then my next question is on the networking solutions side. Obviously, you sound a bit better this quarter than you did last. So I was just wondering what changes you've seen over the last 90 days that have led to the better assessment.

Well, I think, for sure, the second half in Networks is always better than the first half because of the seasonality and you're in the summer and you're coming out of the winter. So it always makes the business better. As Bob pointed out, margins were unusually low and at the bottom of our experience in the last quarter, so we knew they would get better. We're really seeing and encouraged by the activity in the large portion of the network. So much CapEx went into, particularly in the U.S., LTE in the last couple of years. But you still need the wired portion of the network if you're going to deliver video in -- 30 second download video into your tablet or smartphone. You need to be fiber or very close to the home. So sort of the physics would say got to build fiber deeper. The recent RFP activity says, boy, there's more RFP activity. We saw the first year-over-year increase in our orders in 6 quarters. So all of those are positive signs. A year ago, all of those weren't happening, and we were not as bullish, to say the least. so we -- but we also know that 1 quarter or 2 quarters doesn't make a trend. But the most important thing is we have an outstanding product line, and we are well positioned around the world. I mean, we are -- we're calling on every major carrier, and they know who we are, and they know what capabilities we have. And so we're positioned -- as they decide to accelerate, we're positioned to help them and benefit from that. I think that was the end of the questions. I'll just take a minute to wrap up. Again, a very good quarter for us. I would…

Thank you. And ladies and gentlemen, that does conclude our conference for today. Thank you for your participation and for using AT&T Executive TeleConference Service. You may now disconnect.