All right, we're going to get started again. We are very excited to have Rockwell Automation with us. We've got Blake Moret, who is the Chairman and CEO, and Christian Rothe, who is the Senior Vice President and Chief Financial Officer. As I walk over to you guys, Blake, I'm going to turn it over to you because I think you have a couple of slides, and then we'll get into Q&A.
Thanks, Andy, and thanks, everybody, for being with us. You saw the transition from the beach here in Miami to Milwaukee and what has got to be one of the most flattering views of Milwaukee, Wisconsin.
It looks good.
Yeah. So, a couple of comments, and then Christian and I are happy to take Andy and your questions. First of all, Rockwell is a pure play. We're devoted to industrial automation and digital transformation. It's all we do. I'm very proud of the diversification of the company. As you look at what we're offering in this space, the mix between hardware, the Allen-Bradley products that we've been known for for many, many years, the software, both what we have developed organically as well as what we've acquired, and then Lifecycle Services, the digital services, cybersecurity, especially with the expansion of margins that has come to what has traditionally been a lower margin business.
We have great existing access into all parts of the manufacturing and production economy through automotive in discrete applications, e-commerce and warehouse automation, which is particularly hot, growing reach into semiconductor, in hybrid applications, food and beverage, which is our single biggest served vertical, life sciences, home and personal care, all of which seem to be coming off of a bottom, and then in process applications, and this may be a surprise to longtime Rockwell watchers, but 40% of our business goes into process applications, so it's the biggest of those three buckets of vertical markets. In November of 2023, we introduced a growth algorithm that called for our expectations of higher underlying growth in the automation market, driven largely by scarcity of workforce. I think that's further amplified by the current pressures to move manufacturing back into relatively high cost end markets.
And the only way that equation works is by complementing that labor with automation. And of course, that's a good thing for us. We see share growth. We also have expanded the service market through acquisitions like Clearpath, which brought mobile robots into the Rockwell family. Annual recurring revenue, over 10% of our total revenue today, contractually bound software and recurring services. And we expect that to continue to grow double digits. And then while we've taken a pause from acquisitions to digest what we've already acquired, we do expect to get back on that track, giving us an additional point on average of growth a year. North America is where a lot of the conversation turns to nowadays. We have the highest share, the best support, the largest installed base, and by far the best channel in North America.
And so while our competitors see it as an attractive market to compete in, and we don't take any of them lightly, we're more than holding our own because we've got a strong position. And I do expect to continue to see the growing result from things like mega projects, wherever they're purchased, whether it's purchased in North America or whether there's a European machine builder, an Asian engineering firm. It's a global battle that we're engaged in, but I think we're well positioned to get more than our fair share in the investment in American infrastructure. Importantly, we're complementing our innovation to grow top line with a pretty comprehensive cost out program. Our first quarter results, which we talked about a couple of weeks ago, demonstrated early success in this area. It began with a pretty robust reduction in SG&A cost last year.
Some of that was to align with current business conditions, but probably more importantly, it was to create a new baseline that provides for the expansion of margin over the years to come. We've added to that reductions of cost in additional areas such as direct material through a vigorous sourcing wave, sourced material and services that go into the indirect category, additional efficiency in our manufacturing footprint, as well as continuing to take a comprehensive view of pricing opportunities and taking opportunities to reduce our overall SKU count to be able to streamline those operations as well. You heard us talk about the full year outlook during our earnings call, so I won't go into this again. But if you're hearing a more optimistic tone than you might have heard this time last year, that's not a coincidence. And so with that, I will turn to Andy.
Thank you, Blake. So as you're walking over, I think one of the most interesting aspects of your last Analyst Day, which you had in November, was really seeing you and Christian together on the stage talking about operational excellence. It's a bit unique to see you present that together, CEO and CFO. So maybe with the understanding that you're in the middle of your cost reduction and margin expansion, how would you say the day-to-day operations of Rockwell are different versus this time last year?
Yeah, well, I'll make a couple of comments. And then Christian, of course, has great perspective coming in recently from the outside. But while continuous improvement has always been a part of Rockwell's fabric, if you will, we haven't done something comprehensive in terms of a far-reaching cost out program in a while. We needed to, based on the reduction in top line we saw last year. But again, more importantly, it was to revitalize that muscle in the company, especially after the volatility of COVID and supply chain crises, where the day-to-day activity for a lot of our people in sourcing and engineering was just being able to bring material in, as you've said, transform it and get it out the door.
And so being able to take a step back and say, okay, now we need to take a look at the inefficiencies that inevitably built up there and to create a baseline for hitting our margin expansion goals. We needed to continue, of course, to launch new products to market, make sure we're continuing to innovate, but complementing that with a new lower cost baseline that would allow us to ensure that as we return to growth, that we're doing it with the expected margin expansion as well.
The organization in this process has learned a lot. They're also revisiting skill sets that they've had for a long time. Part of the reason why you're hearing Blake and I have a really cohesive message to the organization, to investors around this, is that we don't want to lose any of that. We really need to build a foundation to hold up this continuous improvement Rockwell Operating Model for the long term that is not event-driven, right? Yes, we're in a moment and we're coming out of a moment. That is event-driven, but at the same time, long term, we want this to be a way of life. In order to have that happen, we really need the organization to have a full operating model that is cohesive, not just around continuous improvement, but it's also taking in the fabric of our cultural tenets.
For example, the top line growth activities that we do around trying to accelerate that growth as well as margin expansion. Put them all together into one cohesive flywheel that just continues to move and gain momentum for the organization. That's really what the Rockwell Operating Model is about.
Christian, I think it's great to have CFO with the operational capability, but how do you and Blake sort of divide up responsibility now? What are you focused on versus what he's focused on in 2025 and beyond?
Yeah, so walking in the door, I think it was important to get my arms around those actions that Blake showed for our cost reduction and margin expansion activities, and again, there's a ton of work going on around that. I wanted to have a really good understanding around the activities that the team is doing, but also kind of where we're going to take that for the long term, and so that's really where I leaned in heavily from day one. As we talk about more of the operating model, that's really a partnership, not just with me and Blake, but it's also with the leadership team as well as all aspects of the organization, and it's important to know that this is not something that is in our organization. We have Integrated Supply Chain , which is our operations and supply chain team.
It is not just focused on that. It's also really in partnership with the sales and marketing organization, the new product development teams. And so trying to make sure that it's throughout the fabric of the Rockwell organization through and through. And that doesn't happen just between me and Blake and one of us taking the lead on that. Really, it's the entire leadership organization.
Yeah, and I think it's important to add. I mean, Christian most recently came from an operating role that was quite interested in top line growth as well. So it's not a digital, I'm interested in what we can do to grow top line. And Christian is looking at how to save the cost. I think there's a healthy tension as we consider alternatives to what is the best path that optimizes both. Because if you think about it, those cost out programs can also help in future revenue growth because they give you a cost base to be most competitive when you need to get into a very competitive type of situation. So it's not exclusive of or destructive to top line if it's done in the right way. And we spent a lot of time talking about how to optimize those two pieces.
Yeah, and adding velocity into that and the ability of the organization to be the most responsive organization on the planet, that's the objective, right? So it's to use those opportunities, as Blake said, to be competitive where we need to be competitive, but also beat the competition in a foot race too.
And as you guys know, one of the balances between growth and margin is price, right? So when I think about price over the years with Rockwell, I feel like you can do more. So maybe you can sort of talk about that because if I look at 2025, you've got 1% in your guide. But again, given even the slide on North America, you've got a huge installed base. There's a lot going on. So talk about the ability to strategic price. And then maybe we can ladder in sort of the tariff conversation into that. You were asked that on the call. You're already putting in place price increases for China, but steel and aluminum, how do you think about incremental tariffs?
Yeah. So certainly price is near and dear to my heart and an area that I always believe, whether you're talking about Rockwell or any other industrial company, I do think there's always an opportunity to continue to optimize the portfolio and think about pricing as one tool in that optimization. And that was, again, when you think to that margin expansion and cost reduction slide that Blake showed, and we used that in a number of venues over the last few quarters. It's everything from making sure that our pricing and price realization is really strong. And it's also looking at our portfolio products too. So we're going down the road of SKU rationalization. We announced in our first quarter conference call last week that we've rationalized 21,000 SKUs.
We're looking at another 39,000 that are being evaluated right now that may or may not be rationalized, but for sure there's pricing opportunities around that. We've also taken some additional action around a larger group of SKUs where we are being very opportunistic in our pricing. That is the low volume stuff that's going to less important customers. We want to make sure we get priced there. So I think there's a number of different ways for us to address this, and absolutely, I do believe that broadly there's an opportunity to realize price. Maybe one other item to highlight here for price realization for Rockwell, a significant portion of our business is like our Lifecycle Services business. Lifecycle Services doesn't actually have, in a lot of cases, they're doing project work and solutions activity. So price realization in that is underrepresented or underreported in that business.
They are getting priced. You've seen it in margin expansion with that business over the last several years. They've done a really good job of that. But to find a way to really report it well is hard for us. So there's an adder in there that's not fully represented around the price realization side.
Yeah. And regarding tariffs, look, we made some changes structurally to the processes of incorporating price and tariffs so that we could see less lag. And so already with respect to China, as you said, we've already incorporated that into the overall model. Pricing is one of the tools with which we deal with tariffs. But we've already made some quick strike changes in our operating footprint because we do have a large amount of manufacturing in the U.S., big plants in Wisconsin and Ohio that we're able to move things around to help as well. Those are things that we've already done. And then we can continue to look at where we can get a return on investment for maybe some bigger moves going down the road as well.
So Blake, it's hard to see instantaneous change, but there shouldn't be much of a lag at all if we continue to see laddering tariffs.
That's correct.
Yeah. Okay. And then Christian, just one follow-up on the project-based business from your point of view. I cover project-based business. Sometimes it's easy to lose price in a big project. Is there still opportunity there, would you say? Because it's come a long way that segment markets are a lot better.
Yeah, for sure. Yeah. So the way for me tracking project-type businesses and wanting to make sure that we are getting price realization really has to do with how we're doing against the original quotation and how we thought about the quotation from a margin perspective and the realization of margin in the actual versus the quotation. The Lifecycle Services team has done a really good job in their performance. Frankly, over the last two years has been very tight as far as their performance against the margin expectations that they put in place when they put the quote out there. So that's how you're able to track. And again, that margin has been expanding, not just on the segment margin side, but on the gross margin side. So that's how I'm very certain that they are getting the price realization around that.
I should also highlight the growing importance of managed recurring services in the Lifecycle Services business. There's been a bit of a transformation in the type of business that we pursued in Lifecycle Services. Recurring revenue is a bigger part of that business. Areas where we can differentiate that we're not competing with smaller integrators, for instance, the development of digital twins for an entire manufacturing plant, simulation services to de-bottleneck. Those are things that we have capabilities to do that we built and bought through acquisitions like Kalypso and Knowledge Lens that kind of set us apart there as well.
It's still early days in the new U.S. administration, but I think we can agree that they're pretty protectionist. That means we often, and I'm sure you often get the question of whether you're seeing acceleration in conversations around whether you want to call it shoring or reshoring. Maybe you can talk about that, Blake. Obviously, and you and I have talked about this, you're not going to change your factory structure so quickly, but at the same time, it's an evolution. Are you seeing increasing conversations as this new administration has taken hold?
There's still a very strong funnel of projects related to so-called mega projects in the U.S. Now, there's a global web of decision-making. So sometimes there's non-US machine builders involved from Europe and other places, engineering firms from Asia, Europe, or what have you. So it's a global game, but we do expect significant orders related to mega projects for new construction in the U.S., for line expansions in the U.S. And we expect that trend to continue over the next few years. We saw those orders last year, a little bit less, but they were overshadowed by the destock phenomenon. As we are beyond that, we expect that to be a more prominent view in terms of orders and setup going forward as well.
It's helpful, Blake, and then obviously you just reported last week, but I'm still going to ask you about orders, at least one question, so orders in January, you said were kind of in line with your guidance, if I may, or your forecast, but you did mention some improvement in underlying demand. Is there anything new to discuss in terms of order momentum in February, but maybe just more importantly, it does seem like something changed in your core hybrid markets, food and beverage, life sciences? You did raise life sciences in terms of your forecast, but you didn't raise hybrid. It's still down low single digits, so maybe I asked you about five questions in there, so if you can remember them.
I'll start by saying we're not going to give new information about the progress of orders in.
Nothing in the third week of February.
Right. But we did say January was consistent with our expectations. A little bit more color around what I mentioned in my opening remarks. E-commerce warehouse automation. There's a few things going on there that make that a strong vertical for us. First, the construction of new fulfillment centers. We have high content in those fulfillment centers for e-commerce. Data centers. We have modest exposure to data centers largely through our CUBIC acquisition. We bought a Danish company that does power distribution equipment a couple of years ago, and they're a big participant there. And then when you think of parcel handling companies, there's a lot of automation. There's a lot of interest in complementing their workforce with technology to make them more efficient, more resilient. And those are all positive trends for us there.
In hybrid, we think food and beverage, home and personal care, life sciences, three of the big verticals in the hybrid industry segment coming off of a bottom. And while we're not seeing a huge amount of new greenfields, companies in the food and beverage space, for instance, are quite interested in modernizations, efficiency, cybersecurity, resilience projects being rolled out among existing plants. We do see some amount of greenfields with the GLP-1 drugs, of course, in life sciences. And we have good readiness to serve there. And then home and personal care, again, efficiencies, incorporation of mobile robots in the production logistics space. Those are some of the things that give us encouragement going forward.
So you answered my question that I was going to ask you on e-commerce and warehouse. So I'll ask you just in core discrete markets like automotive or semicon, maybe you can update us there, Blake. One of the things that we were excited about, maybe it was a year or two ago, was EV battery facilities, all that kind of stuff. So how has automotive transitioned? Are you seeing a bottom yet in that end market just to start?
Yeah. I mean, automotive, I would say is still pressured. We're not seeing a whole lot of new growth in new greenfields and so on. What we are seeing is those companies focusing again on efficiency and productivity. It is the single largest served vertical market for mobile robots. You think about all the forklifts whizzing around in these facilities and the opportunity to automate some of that activity, create a safer environment, more efficiency. And so we see a lot of opportunity with AMRs there, as well as the traditional forms. We talked a little bit at dinner last night in that we saw an encouraging sequential growth across the company in orders, and that was without a meaningful contribution from automotive, which represents about 10% of our business.
It's helpful, Blake. And then maybe just the process. You said you're not seeing any weakening in process, but energy was down mid-single digits. Really just tough comps. But you did talk about some Sensia shipment delays. So maybe you could elaborate on that and your confidence level that oil and gas and mining end up low single digits for 2025?
Yeah, so I think energy, particularly with the encouragement from the administration. I think it continues to be an area of investment. A lot of what we do is upstream, but it's not in the exploration area. So it's more about maintaining and getting more efficiency out of existing production as opposed to drilling new holes in the ground. So rig count isn't as big a factor influencing our participation in the oil and gas business. Sensia was off on shipments. That's the joint venture that we do with SLB. Orders were okay. And that represents about half of what we do in the oil and gas business, the other half being products sold to integrators and machine builders and even directly to the end users.
So I want to open up to the audience in a minute, but let me ask you. You alluded to destocking. That's a question that sure will be happy we get behind us at some point soon. But I'll just ask it to you in this context. You said that the new demand placed on your distributors is flowing through at close to 100% in terms of new orders on Rockwell and also because of the green shoots you're seeing in Italian machine builders. I think in the past, when we've talked, you've kind of alluded to maybe you haven't had as good a data and tracking channel inventory, and you've been improving that over time.
So maybe talk about your ability to actually see what's in the channel now versus, let's say, a couple of years ago and your confidence level that, for instance, European machine builders are done destocking?
Yeah. I'll make a couple of comments, and Christian will have a perspective as well. Two broad aspects of the whole destock phenomenon that we saw. It's excess inventory at distributors and excess inventory at machine builders, some of which get their business through distribution, some we work with directly. We think we're pretty much done. The holdout is probably China, where it's going to take a little bit longer, but not much. The rest, we're pretty much back to an equilibrium state. Just to unpack what you referenced, new demand on distributors in our managed inventory program. It's virtually all the distributors in North America. The new demand that they're seeing is coming to us at a ratio of pretty much unity.
You like to see that in the past, during the destocking period, you would see new demand placed on them, but because they had so much inventory, they didn't need to order as much from us. That's back to a healthy and traditional level of around one-to-one there. We had this data. We just weren't using it in as effective a way as we're using it now with respect to distributors. What we have added is new regular consistent checks with the machine builders to also gauge their level of inventory. We don't have direct measurement of those inventory levels. We need to go out and ask them, what do their incoming orders look like? What's their inventory of Rockwell products looking like? Is it a healthy situation? What are they expecting to place either on us or our distributors in case of orders?
And so that's a regular cadence of polling, if you will, with the questions being asked in a similar way on a repetitive basis. And we weren't doing that prior to the last year.
At the same time, we're still learning about all that, especially on those surveys. It's less than 12 months in process. So the result is that while we're getting the data back, we all know that if you just survey a population, you may or may not be able to just take whatever they say and roll that right into your model. So we're still learning on what those factors might be on that. And I think the fidelity on the data, though, that we have around our distributors that are in the managed inventory process, I think that's pretty good. I think we've given that a higher level of visibility inside of our organization.
It's getting built into our forecasting process as well, so I do think that the organization has made really good strides around really understanding what the channel inventory looks like, but also helping to use that, especially that end user demand onto our distributors and building that also into our forecast and our outlook.
Any questions from the audience? Any questions? One over there.
Thank you. Could you maybe just talk a little bit about market share in the U.S. and Europe, given we've gone through this restock, destock process? Have there been any changes generally or by end market?
Yeah. So there has been volatility, obviously, over the last couple of years. But if you look at it all together, we think we've gained modest share. And importantly, that includes what is one of our most important product lines of programmable controllers. We look at the U.S.-specific reports. We look at the performance of Rockwell versus the most comparable elements of our competitors. And we look at some of the custom reports that cover worldwide demand for certain products like programmable controllers, variable frequency drives. So again, a lot of volatility that we've had to deal with. But through it all, we think we've done a good job of keeping market share stable and in some cases up. And importantly, that includes the U.S.
Any other questions?
Okay. So one of the observations you made during Q1 earnings was that you did have some temporary costs that helped mitigate Q1 decrementals. So maybe if you could size that, that would be helpful. But regardless, you did have good decrementals in your business in the '20s on the strength of both temporary and the structural costs that you kind of have laid out on the slide. So one of the things that there's a balance between conservatism and what have you. So if I look at your guide, and this is probably for Christian, I think you're forecasting your second margin in the second half of 2025 to be lower than the second half of 2024, at least at the midpoint on higher projected sales. So could you remind us, is there some sort of mix impact, incentive comp, conservatism?
How do we think about it?
So sorry, I can't help a lot. It's great to be here, Andy.
Yeah, as well. Sorry, Christian.
The reason why is that since we started with our initial guide for the full fiscal year 2025, if there were any areas where we had gotten some feedback from investors, it was around, well, okay, when you think about the ramp during the course of the year, because we gave an outlook for the first quarter, and then we also obviously gave the full year guide, which implied in that was going to have a gradual increase in the sales side, but also an increase, a gradual increase in the operating margin side. Some of the feedback that we've gotten is that, ooh boy, that ramp is a hard ramp. Now you're telling me that, geez, why is it not? I heard the question right, didn't I?
Yes.
Okay, got it. Just making sure that, yeah.
I'm saying.
I'm happy to have this portion of that conversation as well. Yeah.
Both sides, Christian.
Right, exactly. So yeah, well, so yeah, we do have other sides of that conversation with other investors. So as we look at kind of the comparables that we're up against versus last year in the second half in particular, and the headwinds that we have this year in the second half. So second half this year, we have headwinds from compensation, merit, and incentives. Last year, we did not have any incentives. So that total headwind for the second half is somewhere in the $80 million range. In addition to that, last year, we had an earnout that was an adjustment made to the earnout for our ClearPath business. That was $22 million. So we're talking all told between those two items, three items, we're talking about $100 million plus headwind.
Yes, we do have some cost out in margin expansion activities that are in place that are helping to offset that. But that is really the biggest portion of the deltas, especially when you're thinking about year over year in the fourth quarter, that $22 million ClearPath earnout is a big comparable. And just to put the whole year in context, our guide at the midpoint is for organic to be down 1%. And we're calling segment operating margins to essentially be flat at 19% year over year for the full year. So yes, there's a ton of headwinds that are in place. We're doing a bunch of things to offset that. And that segment operating margin at 19% is something we feel comfortable with.
I like to start glass half full, Christian, so just the opposite side of that, to your point, right? Orders do have to, and I think Blake has talked about slow sequential improvement in orders to sort of make that midpoint of the guide, but I think I don't remember if it was Blake or Christian, you guys mentioned a little excess backlog that you created in Q1, so maybe sort of talk about that because it's in Logix, which is one of your higher margin projects, so how much does that help you as you think about visibility for usually a short-cycle business?
We were happy to come out of the blocks in the year strongly and included building some backlog based on good sequential growth in orders that we'll see ship out through the balance of the year. Some of that was project content in Lifecycle Services, in software, but also in products for some well-understood projects where we'll be shipping out through the year. Of course, Logix was a big part of that and does contribute positively to the mix and the margin.
And, Blake, the audience asked you already about share. And I have a question here about share, but let me ask it to you like this. U.S., obviously a strong business. You don't get a lot of questions about Latin America, which is small, but you've done historically very well there. So maybe talk about that a little bit. And then China, I mean, it's a pretty small part of the business now. So how should we think about that business? Is that going to continue to go down? How do you think about that business?
Yeah. So Latin America is a great region for us. We do have, in most of Latin America, double-digit overall market share. It's got a good diversity of served industries. So obviously, you have discrete industries in places like Mexico, a surprising amount of machine builders in Brazil. You have hybrid, of course, food and beverage, life sciences, and then process, whether it's energy or forest products or mining. We talked about a nice win with Vale, the big Brazilian miner, on the last earnings call. So there's a lot of diversity. And I would a bit of a shout-out to our team down there. They're very good at incorporating new offerings into their conversations with customers. So when we come up with new products or services, they do a nice job of getting that out in front of customers.
And so they're typically pretty fast adopters there. Switching over to China, low market share in China, but I'd say a refocus on where we can win, which is typically a systems approach to the more advanced applications there. So bringing together the software and the hardware and the domain expertise. And that narrows the field of who we're competing against and building from our base there, I think, gives us optimism for our ability to grow in China. As you said, we have a modest amount of our overall business from there, but we think we can grow it and we can grow share.
I'm almost running out of time here. There are a couple of questions I think are very important. Free cash is important for you guys. You did have a strong Q1. We understand that there wasn't bonus payments in the quarter, but did anything change? Is working capital now a decent tailwind for you this year versus the opposite last year?
Excuse me. So working capital for sure was definitely a source of cash in the first quarter. Inventories came down nicely, as well as receivables were a really good source of cash too. So really good start to the year for sure. As we think about it, definitely inventory is expected to be a source of cash for the year. And we're still targeting that 100% free cash flow conversion for the full year. Definitely feel like we got out of the gate the right way to be able to achieve that. And nothing should keep us from changing that level.
And then in terms of uses of cash, Blake, you've talked about sort of pausing acquisitions for now. When would you give yourself the all clear to do that again? That's the first question. And then just you were very acquisitive before you paused. You did Clearpath and CUBIC and Verve. So maybe just update us on their contribution in 2025.
Yeah. I'm very happy with the strategic fit of the acquisitions that we've made in the last few years. We can go down the longer list of the dozen and a half that we've done since, say, 2019, 2020. And in terms of them meeting a customer need, I've been very happy with that fit. They're on a ramp to getting to the profitability that we're looking at there. Clearpath, we said, was loss-making when we bought it, but we expect it to flip to profitability in 2026. Verve, a little bit smaller, but also on a good ramp. And so we feel good there. We continue to track acquisition targets, but there's nothing that I'm losing sleep on today saying I just have to own or we just have to own.
The better value to customers and to investors is integrating the parts, taking everything we built and bought and making sure it works really well together, common look and feel, ability to exchange information from across different software applications and different products, being able to take the data that's born on traditional Rockwell products like drives and bring it up to be able to use AI to drive insights at the information layer. There's just all sorts of things that we can do that make life easier for our manufacturing customers and allow them to be more competitive.
So, last question. Just, I've asked this question of you before in every company. What are the top two or three innovations and structural changes affecting your company over the next five years? And are there any emerging industry trends that are perhaps being overlooked in the company?
You said that really fast.
Yeah.
All right. So a few.
Only 20 seconds.
A few innovations that we've done. First of all, it's the software-defined aspect of our product development, both for the runtime as well as the programming. The cloud-native tools that we've introduced to the market are industry-leading. Production logistics, the independent cart technology, and the mobile robots. And then the high-value services, particularly the ones around digital twin creation and cyber. In terms of what structurally has changed with Rockwell, the cost-out programs, as well as the diversification that the path we've been on over the last half dozen years.
Blake, very much appreciate your time, Christian. Thank you. Thanks again.
Thank you. Yeah. Thank you.