Perfect. Thanks everyone for joining us, and good afternoon. Angel Castillo, Head of U.S. Machinery and Construction here at Morgan Stanley, and it is my pleasure today to have Matt Flannery, CEO of United Rentals, and Ted Grace, CFO of United Rentals. Before we get started, I just want to read a quick disclaimer. For important disclosures, please see the Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley representative. With that, gentlemen, thank you for hosting us here today.
Thanks for having us.
Lots of topics to discuss. Obviously, everything around construction in the U.S. is very topical today. Maybe figured it would be a good place to start, just a little bit bigger picture, macro, and a little bit broader kind of demand backdrop, if you could set the stage for it. Maybe give us the state of the union, what you are seeing in terms of across construction end markets in the U.S. Particularly curious how, if at all the geopolitics, interest rate moves, energy prices, how all of that, if at all, it has impacted what you are seeing in terms of construction demand in the last few months as the scale.
Well, I will let Ted handle the geopolitics and the-
Good point. Okay.
rest of it, but the demand environment feels great. It has really been strong. We had pretty solid expectations when we came out with guidance in January, and the year has just progressed better than we had thought. The construct of the demand has been pretty similar to what our expectations were, where large projects were going to drive most of the growth, and we expected the local markets to be stable. That is pretty much the way it has played out, but with the exception that the large project pipeline has just accelerated. It has moved farther and faster than we had expected through the year, and the execution of the teams allowed us to raise guidance to the most recent level that we did in July. We are really pleased with demand environment, and the industry overall is really on a strong trajectory. Ted, you think the same?
Yeah, the macro dynamics have been pretty interesting this year. We came into the year not thinking you would have diesel north of $5. But if you look at our year-to-date results, the team has done a great job managing that unexpected cost headwind. It is hard to AB test to say what would have happened had things not played out the way it has. But to Matt's point, demand ultimately has been stronger than we expected, despite whatever these headwinds, real or perceived, may be. Certainly the U.S. economy has proven to be very dynamic. I think we have seen that consistently. More recently, there has been discussion about rates and people wondering what the Fed is going to do, what has happened at the longer end of the curve.
Certainly we do not sit around pretending to be armchair economists, but we just remind people that if you were to look at the 10-year yield going back more than three years, it has bounced between 4% and 5%. There is no discernible impact you would have seen on a slowdown when it has even approached the upper end. I guess the question the market asks is, where do we go from here? But the economy and our market specifically have proven to be very resilient, right? That is in spite of what has happened at the longer end of the curve, and even as you have seen what has happened on speculation around the shorter end of the curve. We have gone from 5.25, 5.5 to 3.5, 3.75.
We ask ourselves, if we do get into a tightening cycle, if it's a half a point, three-quarters of a point, you're still well within a range that our industry and the economy has weathered pretty well. I guess ultimately we'll see. If we look at our customer confidence through last week, it is not showing any indications that our customers are thinking about their own prospects differently given all the debate going on at every level. Anything else you got there, Matt?
Agree.
Maybe, listen, I think it's totally a point taken. The economy, like you said, on the construction side, has held up far better than expected. I think as we look at the data, I think what I want to make sure to touch on is you still have done much better than even what the underlying has been showing, right? You look at construction starts in terms of square footage. You look at construction spending, and yet you're guiding to 10% growth, right? You talked about the megaprojects a little bit, but it feels like there's a little bit something here, either the data that is a little bit maybe gets restated, ends up being that it was better than we thought, or there's something that URI is doing that's ultimately delivering better results ahead of what even the industry or the macro would suggest.
Hoping you could kind of unpack that for a little bit, like for us. What are you doing in terms of differently that go to market, either winning more than your fair share? What is a little bit different about your results that you're driving?
It goes back to the strategy we deployed as far back as 2010, coming out of the recession, right? We decided we have to be aligned with the largest contractors, the largest projects that existed in our space because we learned if we wanted to have resiliency, we needed to be with people that were going to get to work through downturns, upturns, and just really counter the cyclicality story that we were burdened with. It's actually playing out really well. We spent a couple of decades building out this network and this connectivity to the largest customers and contractors in the world, and it's really playing out well during these megaprojects. This isn't anything new for us. We've been focusing on major customers and major projects for so long that this is just a manifestation of that strategy.
The other big part of that strategy is our one-stop-shop strategy, where we started talking about specialty once again 20 years ago and 15 years to the street in more consistency. That strategy has developed now into seven different business units that solve different problems for our customers. As you can imagine, these megaprojects have more complex needs. You can assume the larger the project, the broader the needs are going to be. So the competitive moat that that's created is really why I think you see us outperforming the industry overall and all the data points that you point to that show maybe we shouldn't be able to have double-digit growth right now.
Yeah.
It's a lot of hard work. It's sticking to the strategy, but it's building a long-term relationship that customers can count on.
Mm-hmm. The one thing I might add that tacks onto that is the vertical strategies we've introduced. As an example, in 2016, we publicly introduced what we called our power vertical strategy. It's not that we foresaw the electrification of the economy or AI or anything along that. We just recognized that these were very demanding customers that spent a lot of money consistently, and that our differentiated value proposition could actually be truly valued by them. So, we probably got a 10-year head start on everybody else in terms of developing those relationships, not just with the E&C companies that focus on power verticals, but the utilities themselves.
We did that for a couple reasons. Not only is it a huge market, but it's obviously a pretty stable market. More recently, it's had these secular growth trends, and we've been very fortunate to be well-positioned. We did the exact same thing in infrastructure. If you go back to the acquisition in Neff, that was really predicated on our belief that we could have a differentiated value proposition in an end market.
That clearly there had been dramatic under-investment domestically in infrastructure going back probably to the 1960s, 1970s, or 1980s, depending on how you want to look at it.
That was really part of the strategic justification for the Neff acquisition. We did not foresee Congress finally passing IIJA.
We figured at some point the bill's come due, and it's going to have to be paid. So I'd say we've been fortunate in looking around the corner and building vertical strategies that complement everything else Matt talked about.
Yeah. No, it's definitely paid off. Again, a very good performance. And I want to remind the audience, if you have any questions, raise your hand at any point. I want to make sure you get a chance to ask your questions. Otherwise, I could go forever up here. But maybe just to that point as well on the rental penetration, that's been a good story as well, maybe more for the broader industry, right? And I think part of that, one, I want to understand, I guess, where are we today in terms of that rental penetration? Where do you think that can continue to get to? Does it stabilize at a certain point? And what impact do mega projects versus local commercial have on that penetration? Does it skew it one way or another?
ARA will report as they measure it, rental penetration's in the high 50s. I think it might be 59% right now. That's up five or six points from five years ago. Where it can go, you'll have some people point to low 80% in more mature European markets. I don't really know if we know where that's going to go, but we think the total addressable market is even larger than the $80 billion that ARA speaks to.
Yeah.
We really think there is a secular play here. I believe that penetration in our industry is a one-way staircase. For the 30-something years I've been doing this, I haven't seen customers rely on rental and then decide to go backwards because the industry's so much better at what we do. We're so much more reliable, and I think the sophistication of the industry and the reliability of the industry allows people to take the math that works. It pencils to rent. The shared economy actually works. We think secular penetration's a big part of the play as well.
That's super helpful. I guess maybe to that point, you've seen just continued growth, and part of that has driven perhaps more aggressive growth from other, not necessarily entrants, but smaller players or other OEMs to try to leverage the rental side of their business a little bit more. As you look at that, what is it doing from a competitive standpoint? What are you seeing in terms of discipline around supply? Any concerns around that, or how are you thinking about that growth that you're seeing from others?
I'll start, and Ted, you can add on. We feel really, really good about the discipline of the industry, first off. We think the supply-demand dynamics are strong. We think the demand overall is strong, which is the first part of that that you need. But even the behavior and the information that's available to the national companies has really created a disciplined industry that maybe didn't exist pre 2009.
That's first and foremost. The second thing is the opportunity for the industry to continue to show discipline as a leadership group. When you think about the top few in the industry, I think we have a leadership responsibility that we don't use our pricing power to take the air out of the room or to do anything that's not healthy for the industry, but to create more value for the customer and more services. And that's what we're spending our time and energy on doing, and I think it's paying off. This is a competitive industry. There's always new competitors in the industry, but the competitive moat that we've built, and to be fair, a couple of the other national players have built, is hard to replicate.
That distribution network, 1,750 branches with all the different products that we offer, is quite an advantage that we continue to trade on.
Yeah. No, I think you touched on all of it.
And maybe just another way to kind of unpack that a little bit further, I guess. When you say discipline, are you referring to purely supplies or also on the rental rate side? Are you seeing discipline across both? Any way to kind of contextualize both differently? For me, I would say just smart activity. Not forcing fleet into a market. One of our largest competitors pulled back on fleet a year or so ago, and they were public about it because they had absorption opportunity. I don't know that that would've happened 20 years ago. I just think not forcing fleet into the market, making sure you're meeting the demand responsibly while running a profitable business is what I think about when I think about discipline in the industry.
Yeah, I agree. We've talked about this discipline for a while. I think if you go back and you think about the last few years, some of our competitors' actions, public competitors, 2023 and 2024, really cut back their CapEx, even as they were growing their business and growing it at healthy levels. They talked about rebalancing their own capacity. While the public saw that, privately, we saw it much broader across the industry through kind of aggregated data we have access to. That is a critical sign of discipline. When you right-size supply-demand, that obviously puts the industry in a much better position to achieve positive rate. Right? Now through that, even though you had negative time industry-wide, the industry actually had positive rate. I think that is the first time in the history of the industry that's ever been achieved.
Ultimately, supply-demand is the ultimate arbiter of rate. There are other factors, but that is probably the critical one. Coming out of that episode in 2025, you saw that discipline continue, where time ute industry-wide was positive year-on-year every month. That's continued year to date through 2026. I guess the summary there or the takeaway is this discipline is very real and it's helping support companies achieve positive economics on the assets they employ, and that's critical.
No, that's very helpful. I think maybe last one on kind of the supply dynamics. I think you've talked about being at kind of the highest rates of time utilization that you've been in the past. Just what does that tell you about the backdrop that we're in today, the implications to rental rates kind of from here, or we start to see CapEx pick up, seems like in a very kind of disciplined way, to your point. Just, yeah, what does that kind of tightness in the industry tell you?
Without talking about rates specifically, I would just say the base is there to drive productivity, right? If we can drive that productivity through efficiency, through pricing, through making sure that we're managing our costs, that's really the goal here. We can be a better partner to our customers.
Yeah.
Right? By driving some of that efficiency as well. I think that's what we're focused on. That's what we laid out when we set the goals for the year, and that's really what we're talking about.
Okay. No, that's very helpful. Again, if anybody has any questions, feel free to raise your hand. Maybe just, I guess, continuing along those lines of investing in the business, I guess part of what I want to understand, so we talked about a little bit on the CapEx front. The M&A side, surprisingly, it was an area that you could always drive growth in. But increasingly, I've been kind of hearing about it as a potential risk, like have you gotten big enough where it's harder to increasingly move the needle with deals or acquisitions? First, how would you kind of respond to that, and how would you kind of describe, I guess, your pipeline of opportunity on the inorganic side to it?
The pipeline's pretty robust, and we've been talking about that each quarter for quite a few years now.
We have an internal team that works really hard at generating deals as well. We're just very disciplined about what's going to get over the transom. We've talked about our three-legged stool of it needing to be strategic, cultural, and then finally that financial hurdle that it needs to cross. That's the one that we can't get all the deals over. But we're going to be very disciplined. We've shown that in the past, more recently in a pretty big way last year. We'll continue to work this pipeline, but there's not any shortage of opportunities. More importantly, it's a capability we've built. It's a muscle that we shouldn't waste. We're pretty good integrators. We're pretty good cross-sellers. Anytime we get an opportunity to add another, whether it's new product or new team to our portfolio to help serve our customers, we're not going to hesitate to do so.
Got it.
I think the only thing I would add to that is if you go back and you look at our history, people have this perception that we're always doing deals, and we certainly are always looking. But the reality is the math will show you it can be lumpy.
There can be years where we don't have much to show for all the effort, and there are years where there's a lot more to show for it. So in itself, if people see a period of time where we didn't do anything deemed to be material or considerable, that's not unusual at all. There's certainly, we think, a lot of opportunity on the gen rent side, a lot of opportunity on the specialty side. Then there are a lot of unconventional deals, corporate lift-outs and things along those lines that really are in nobody's radar screens that are also opportunities for us as we talk about expanding our product suite and going after that much bigger TAM than sometimes people perceive.
Yeah, I know you don't necessarily want to give us an exact kind of, this is what we're after. We're just curious, as you think about the opportunities of the products, the seven specialty products you have or gen rent versus potentially adding another leg to the stool, I guess. Where are you seeing more perhaps opportunity in terms of what's out there?
You're right. We won't foreshadow what we're going to do. But we would just say that we see anything that's temporary on a job site or in a plant as our right of way, as an opportunity for us to add value and help support the customer. So you could imagine that anything that falls into that purview we're looking at.
Maybe last one on this. Which of the three pieces that, the three hurdles that people need to get through or the potential acquisition needs to get through, which of these is harder to ultimately find? Is it the discipline on the financial side, getting it to right value? Is it the culture side? Which one of these is a little bit tougher to get across?
I'd say the first two are gating mechanisms, and I think rental people overall, and most of the deals we've looked at, and most of the deals that we've brought on board would be good fits culturally. So it would be the financial, and that's because the bar is high for us. We set high expectations, and we're not going to wane from that responsibility.
Mm-hmm. And maybe, to your point, it can be lumpy ultimately when deals get through. In the absence of that, should we just assume that there's going to be a little bit more buybacks? How are you kind of thinking about ultimately the deployment of that capital?
Yeah, I mean, the philosophy or the framework we've used for returning capital or capital allocation more generally has served us well. It always starts with organic investment and what capital can we prudently meter into the business to complement that with the acquisitions that you're going to fund out of free cash flow. After that, whatever we deem to be discretionary excess free cash flow, we return. The dividend is a relatively small portion, and the balance is returned via buyback. Certainly, we love when we have good deals that are going to help our customers and help our shareholders. But when we don't have the ability to deploy capital there, we're very comfortable buying our own stock.
And then I think last time, or the last one, I guess, in capital allocation, last time we talked, I think there was a discussion around the potential upgrade down the road to investment grade.
Yeah. Just would love to get your thoughts as to, one, what are the implications of that to your capital allocation strategy? Is there any desire to then perhaps be a little bit more cautious near term because of that? Or is there just so much firepower that you can kind of do both? Just more broadly, what would be the kind of implications of a potential investment grade upgrade?
Do you want me to start?
I would just say there is not going to be any trade-off of firepower. We are already living there. I would if we thought there was going to be any kind of inhibitor for being IG to execute our strategy, then we would not be. I think this is a reflection of the ongoing evolution and maturation of our business. What had held us back, frankly, was internal corporate policy.
We had told the agencies we wanted to maintain the flexibility to use the balance sheet to drive inorganic growth. As we have grown and grown and grown, frankly, our dry powder sitting in the balance sheet is probably conservatively, debt-funded capacity is $15 billion. Realistically, that is plenty, right? Then we asked ourselves if we do not need it, what is the point of maintaining this policy? If you look at us and you grid us out against our largest competitor, who is IG, we actually have a better credit profile. So intuitively, you would say, all right, well then, if you can do that and you get the benefit of the spread, why would not you? Because there is clearly a benefit and there is not much cost, if any, because it does not inhibit us from large-scale acquisitions.
That was really the internal discussion Matt and I had with our team. Just the time was right. We are on positive outlook at both of the major rating agencies, which puts them in a position to conceivably upgrade us within 12 months based on their own language. That is very helpful. I think we have a question up front here, if we could get a mic. Do we have a microphone that we could get? If not- Danny, you want to go? I can always repeat it then.
Sorry, without mic.
Yeah.
Not a separate question, but more general picture this morning, many of your other companies saying the next sort of pipeline or outlook looks even better than previous cycles. Thank you. Cycles. Yeah. The outlook for United Rentals looks also very promising. Is it even better? Matt, you said outlook even or the pipeline subdued more delayed, so longer visibility. How long can you look? Also I learned in the previous years talking with your company that normally you're a bit late in the project, where because, when everything's already designed and prepared, then at late your equipment comes on the site. So maybe even some of your visibility is even not within your own books yet, is it?
Because if we think about a 10-year cycle for grid investments in U.S., the gas pipelines for all these data centers, the power gen sets, compressors, all of that, so.
Yeah. Yeah. We agree. We think the pipeline and the growth runway ahead is robust. You get asked in a different way, how long is this cycle? Well, I think the demand that we're seeing right now and how strong it is, despite outside of major projects, Power & HVAC is also a growing sector right now. There's a ton of other sectors that we serve that aren't hot right now. LNG is starting to come up. Petrochem's not very strong right now. Residential, which although we don't play strongly in residential, is certainly a feeder, right? Into other business that we serve. So we have plenty of runway ahead of us. We agree. We feel really good about it.
Ted laid out this construct back in 2022 at our investor day about all the tailwinds. The point was that there were seven different tailwinds, and we only needed a few to hit to have the growth runway that we need. I think that is manifested, and with the addition of data centers has even accelerated.
Sorry. On the verticals, you said, it is a special sort of target, which helps to fuel the growth over the last years. I did not see, like for instance, utilities as a separate, but that is probably on the infrastructure.
That is the power vertical strategy.
Oh, power. Yeah.
is specific to-
Yeah.
IOUs.
On the data center power generation opportunity, is that a segment where you play in, like providing power gen for data centers? Maybe you have already some data you can share in terms of megawatts you can already have in your portfolio, for instance, in gen sets?
Yeah. We definitely support during the construction phase. We would not be base load power for a hyperscale data center that is running hundreds of megawatts or more. We certainly have projects where we could have 100 MW of generating capacity. I think our total fleet size is north of 2 GW of capacity. But it does tend to be more temporary. When you are talking about that kind of base load, it is generally not going to be diesel. It is going to be natural gas, and it is either going to be high-pressure natural gas running off recips or turbines if you are kind of running behind the meter. Matt, would you agree?
You said well.
Maybe just sticking with the specialty side. I think that is an area that is a little bit tougher to model because you do have seven different product lines, slightly different end markets. I think in the past you have said that you expect this to continue to grow double digits, right? As you just mentioned, Matt, not every single kind of line or vertical or end market is growing at the levels that we are talking about in terms of double digits. Can you help us understand what gives you confidence in that double-digit growth? Maybe is it organic? Is it inorganic? Is it the growth that you see across some of these specific verticals? Just help us underscore that bridge, or underwrite that bridge?
Yeah. First and foremost, it's the penetration opportunity within them. We're not as deeply penetrated in just about every one of our specialty businesses. But even when we think about our more mature ones, like Trench and Power, which were our two first specialty businesses, they've been growing double digits for years and continue to grow strong double digits. Power is our largest specialty segment right now, and it's our fastest-growing.
That's without getting into turbines or getting into any specialized, what we would call, more niche power items. Just our experience, when you add on some of the new products that we've added on, like matting, which our national footprint still has white space, mobile storage and modular, we still have white space there. The combination of all this, we feel very comfortable talking about double-digit growth for the foreseeable future.
Just to clarify, that's on an organic basis.
Correct.
Inorganic would be-
That's on an organic basis.
In addition to that.
Yeah.
Okay. No, that's very helpful. And maybe to that point, I guess because specialty also brings in some of this ancillary aspect of things, right? That you might be delivering value to your customers in other ways that perhaps margin-wise may be a little bit of a drag. We saw that a little bit last year. So, can you just kind of help us understand again where we are in terms of that ancillary, what some of those products might be, and why it makes sense to play in that?
Yeah. So ancillary revenues that really help support our rental customers, there are three big ones that we've talked about. Pickup and delivery would be the biggest of those activities. So in the vast majority of our transactions, customer's asking to deliver the asset and pick it up, right? It's convenience for them. They don't have to have the assets or the people or go through the process. Then we'd have, call it installation services. Could be set up, breakdown, other kind of services we'll provide the customer needs. Historically, they may have gone to third parties. What we've done is say, Listen, we'll do that on your behalf so you can focus on building whatever you're building and not be distracted by having to hire electricians or plumbers or whatever it is. We'll do that. We do it through third-party labor. And things like fueling services.
You can imagine the equipment we have on their site, a generator needs constant fueling to provide power. Those are things that we are actively working with customers to provide. It makes their lives easier. It's things they need done. It's things that aren't necessarily easy to do, so many of our competitors look at it and think, I don't want to do that. But in that creates an opportunity and it's a competitive advantage because we're willing to do these things. Importantly, these are profitable businesses. They are not as profitable as our core OER business
but they would come with contribution margins in the low 20s. Effectively, there's no capital deployed. I mean, we've got some working capital as we're paying people and waiting to get our money. You're talking about competitive advantage, attractive margins, strong returns, and that augment our value proposition. That's really the reason we were pushing into this.
It does have a dilutive effect, but that does not at all mean it's a bad business. It really complements what we do. We remind people, if you look at our growth versus our peers, we are considerably outpacing them. It's hard to say exactly all the factors that drive that, but one of them is this whole strategy of being that partner of choice and doing big things and small things that really help add value. We think of our shareholders getting the benefit of the growth and what we think are attractive economics.
Maybe just to that point, I guess two sides of that. One, I think part of what you've been delivering has been pulling levers internally, whether it's doing things internally versus third party, just making sure you manage your costs in a way that has delivered very strong results over the last couple of quarters, despite some of those factors being a little bit of a headwind. One, can you just remind us of what some of those levers you might be pulling are? On the flip side, you mentioned this is no incremental capital, but is there an opportunity there to invest in more transportation or more kind of assets or capital that can give you more, I would say, capabilities to give even more value to your customer?
I'll just answer the latter part. There's not an either/or there.
Okay.
Right? There's an and. We don't have a lack of funding capability. We don't have a lack of opportunity for growth. One's not a trade-off for the other, and I'll let Ted take the other part about some of the variables and the actions that were taken.
Yeah. We came into this year, we talked about the importance of labor absorption. If you look at our disclosure, and now all companies are providing greater segment disclosure in their income statement, the team has delivered against that. The biggest thing that's benefited us from a margin perspective has been that labor productivity. You can see in a lot of metrics, we disclose labor as a percent of total revenue, rental revenue. You can see it in rental revenue per FTE. But the team's done a great job driving really strong productivity. We've also achieved strong results in R&M.
You think about some of our biggest variable costs, but repair and maintenance is one of them. The team has been able to find ways to be more efficient than they generally are, which has been helpful. Even delivery. When we came into the year, we said we thought our delivery expenses would grow at a faster rate than rental revenue, and that was part of the reason we undertook this restructuring program was to help enable that or support that. We're at the midpoint of the year, and the team's actually been right side up on delivery costs. If you look, our rental revenue in the second quarter was up 12.7%, and delivery expense is up 11.7%. It's increased with volume, but the team has done a great job finding those efficiencies that we ask of them.
I'd say those are the big three that we talk about, labor, R&M, and then delivery. That have offset. I'd say the biggest surprise on the year has obviously been fuel costs. A year ago, we averaged $3.66 a gallon in diesel. Year to date, we're running at $5.34. That's not something anybody anticipated when they gave their initial 2026 guidance. In the second quarter, one of the things we called out, 70 basis points of margin expansion. You back out the one-time gain, and you adjust for the outsized growth in ancillary and re-rent, margin's still up 40 basis points in the core while we are absorbing the better part of 30 basis points of that going from gas and diesel prices in isolation. That tells you the team's done a fabulous job delivering against the surprise there. What else would you mention?
Well said. Execution's been great, and we didn't want to count on growth coming into the year to hold margins flat. We made that commitment, and we gave the team a task, and that's why the restructuring happened. But I'm really pleased with the execution. And now that we have the growth on top of it, I think that's why you're seeing the results you're seeing.
And maybe with just the last few minutes that we have left, it's a topic that probably warrants a lot more than a few minutes. Just to your point on the changes that the business has made over the last decade or 20 years, I think technology is an area that maybe doesn't get talked about enough that you have been investing in telematics, just broader technology. And I think for all this discussion around AI, I think maybe it doesn't get talked about how you've recently announced, I guess, the AI-powered equipment agent be accessible in ChatGPT, and then just how much technology and AI may be benefiting your business. So could we maybe just touch on that with the last few minutes? For investors that don't necessarily run a job site, ultimately, what do these tools mean?
How does it change the customer behavior and impact your business financially or just, again, that customer relationship?
Yeah. That AI agent just makes it easier for people to spec what they may need for a job, and it's a fairly simple tool technology that already exists, but our job isn't to invent the technology, it's to deploy it in a way that's digestible to the customer. But we've been a technology-enabled customer for quite some time. You go back all the way into when we started to invest in telematics, which was quite an investment when it wasn't in the early days, about 12, 15 years ago, we decided to do this. Most companies weren't spending that money. But when you put that combination of all the data that almost 400,000 telematics devices on our equipment gives us with all the capabilities of AI, all these already embedded technologies that we have in our processes can get improved really quickly.
I think that's the part. Somebody asked us earlier today in a meeting, "How do you feel about your spend in technology? Are you spending enough?" I think we're going to all be spending significantly less because I think AI is going to be able to enhance many of these tools faster, cheaper, and frankly, we'll probably be doing a lot of these improvements internally. With the help of AI. I actually think that the capabilities that we've already had in utilizing technology to be a better partner and the change management that's necessary, we're through all that.
Now it's just a matter of taking the most modern technology and AI specifically to enhance everything from your price optimization engine to your logistics to helping a tech troubleshoot a repair for a machine. These are all things that we're working on, and we did an investor day for the sell side that maybe at some point we'll get some more material out there. This is something that each group within our business is very, very focused on.
Yeah. No, I had the pleasure of attending that. Definitely, like you said, you realize it touches every aspect of your organization. That's incredible. As I said, I unfortunately unpacked a can of worms that now we don't get to dive deeper into, but feel free to reach out to him if you have any questions. Otherwise, again, thank you, gentlemen, for joining us. Very helpful.
Thanks, Angel.
Thank you.