Good afternoon, ladies and gentlemen, and welcome to Descartes Systems Group quarterly results conference call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on June 3rd, 2026. I would now like to turn the conference over to Scott Pagan. Please go ahead. Thanks, and good afternoon, everyone. Joining me on the call today are Ed Ryan, CEO, and Ed Gardner, CFO. I trust that everyone has received a copy of our financial results press release that was issued earlier today. Portions of today's call, other than historical performance, include statements of forward-looking information within the meaning of applicable securities laws. These statements are made under the safe harbor provisions of those laws. These forward-looking statements include statements related to our assessment of the current and future impact of geopolitical, trade, and tariff, and economic uncertainty on our business and financial condition; Descartes' operating performance, financial results, and condition; cash flow and use of cash; business outlook; baseline revenues, baseline operating expenses, and baseline calibration; anticipated and potential revenue losses and gains; anticipated recognition of revenues and incurrence of expenses; potential acquisitions and acquisition strategy; cost reduction and integration initiatives; the approval and potential share purchases under a Normal Course Issuer Bid; and other matters that may constitute forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other factors that may cause the actual results, performance, or achievements of Descartes to differ materially from the anticipated results, performance, or achievements implied by such forward-looking statements. These factors are outlined in the press release and in the section entitled Certain Factors That May Affect Future Results in documents filed and furnished with the SEC, the OSC, and other securities commissions across Canada, including our management's discussion and analysis filed today. We provide forward-looking statements solely for the purpose of providing information about management's current expectations and plans relating to the future. You're cautioned that such information may not be appropriate for other purposes. We don't undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations or any change in events, conditions, assumptions, or circumstances on which any such statement is based, except as required by law. With that, let me turn the call over to Ed. Thanks, Scott and w elcome everyone to the call. Today, we are again reporting record quarterly financial results coming off a strong financial year last year. In Q1, we were ahead of our plan, which gives us even more room to make AI and other investments in our business. These are great results that I'm looking forward to walking through in more detail, however, f irst, let me give you a roadmap for the call. I'll start by hitting some highlights of last quarter. I'll provide some comments on how the numerous events in the world are impacting our business. I'll hand it over to Ed Gardner, who will go over the Q1 financial results in more detail. After that, I'll come back and provide an update on how we see the current business environment and how our business was calibrated for Q2. We'll then open it up to the operator to coordinate the Q&A portion of the call. Let's get into Q1. Key metrics we monitor include revenues, profits, cash flow from operations, operating margins, and returns on our investments. For this past quarter, we again had record performance in each of those areas. Total revenues were at a record high $193.6 million, up 15% from a year ago. Record-high services revenues were also up 15% from a year ago, with our continued focus on generating recurring revenues. Record net income was up 34% from a year ago. Record income from operations was up 35% from a year ago. Record adjusted EBITDA was up 20% from a year ago. Our adjusted EBITDA margin is at a record level of 46%. We generated $75 million in cash from our operations, up 40% from a year ago. It's a strong record results across all these key metrics. At the end of the year, we had $377 million in cash, and we were debt-free with an undrawn $350 million line of credit. We remain well-capitalized, cash generating, growing, and ready to continue to invest in our business. We have a Normal Course Issuer Bid that allows us to purchase up to 8.6 million shares before December 2026. We've made some purchases since last reported, and I'll allow Ed to give you those details in a minute, b ut, especially in light of how the business performed last quarter, we are optimistic about Descartes' future, and the Normal Course Issuer Bid is a tool we could use to make further purchases. I want to touch on four areas that helped this business perform well this quarter. The first is Global Trade Intelligence, which is one of the largest contributors to our services revenue and had a strong growth in the quarter compared to where it was a year ago. That's pretty intuitive if you think about what's happened over the past year. It's become increasingly challenging and unpredictable to determine how to ship goods from point A to point B, especially if they need to cross borders. We've seen strong growth across the four core areas of our business or of the Global Trade Intelligence business. The first is tariff and duty content. We believe we have one of the best real-time sources of global tariff and duty information. This past year, there have been huge and frequent swings in the tariffs and duties, particularly from large shipping or importing nations like China and the United States. As we've said before, if tariffs and duties are changing, that's usually a pretty good sign for this part of our business. The second is the sanctioned party screening business, where we continue to be a leader in sanctioned party screening, and we continue to see strong growth here as we help our customers navigate an increasingly complex sanctioned party environment stemming from the global, current global geopolitical landscape. Third, we have foreign trade zones or FTZs. These are facilities where goods can be imported and stored and processed on a tariff-free basis until they're ultimately released from the facility for consumption in the domestic market where the facility or zone is. With all the tariff uncertainty for imports in the United States, more and more companies have been pursuing this option for their business. It has proven to be a particularly lucrative strategy for those who deferred paying any of the recent IEEPA tariffs that were invalidated by the Supreme Court. By not paying the tariffs, these importers do not now need to go through the delayed process of trying to obtain refunds. Stronger grower so far, and with continued uncertainty about the legality and amounts of tariffs, one that we expect many companies will continue to pursue with our technology leverage for the operation of foreign trade zone. The last one, number four, is Datamyne. Companies have adopted a myriad of strategies for dealing with tariff uncertainty, whether it's different sourcing strategies, consideration of classification of goods, or even shipping routes. The best companies are doing as much research as they can to help guide their strategies, and that's where Datamyne comes in, c omprehensive research tool to see how others are dealing with importing challenges. This continues to see good traction and is a good grower. Second area of growth for us was the e-commerce entries. We continue to see overall growth in consumers embracing e-commerce, even with the elimination of the tariff-exempt Type 86 de minimis program, imports have continued to grow coming into the United States. We have a premier solution for handling e-commerce imports into the United States using our NetCHB system, with particular strength in high volume and high velocity requirements. We're helping key brokers meet the demands of importers, and t hese volumes are contributing well to our revenue growth. The third area is fleet performance management and routing. We have market-leading solutions to help customers manage their fleets of vehicles. In particular, we have routing and scheduling solutions that help companies figure out the most efficient way to make deliveries and reduce hours and miles driven to do that. There's always good demand for these solutions. However, t he demand increases in periods where fuel costs increase, running a fleet becomes more expensive, and customers look to our solutions to reduce the amount of fuel they're using to make deliveries. Cost-consciousness for fleet owners is even higher given the inflation that exists in driver wages. This wage inflation is driven in part by driver shortages. New U.S. regulations have made it more difficult to qualify to be a driver. The final one is transportation management, where MacroPoint continues to be strong for us. MacroPoint provides real-time visibility to shipments. Brokers and shippers tell us the loads they want tracked. It's our job to get the tracking information from onboard systems, transportation management systems, and using our application or old-fashioned calls to drivers. Over past quarters, we've enhanced our system to have AI agents that interact with drivers to encourage adoption of our tracking app, helping us reach a segment of the market that was previously difficult to reach at scale. These agents have helped contribute to a higher percentage of shipments tracked than our peers, which in turn drives more people to our network. We've also released some new agents to help brokers manage current workflows on shipments, which I'll speak to further in a few minutes. Those were the principal contributors to growth. We were able to help our customers in a challenging freight environment. We generally saw overall shipment volumes down in the quarter, with the biggest contributor to that decline being the war in Iran. Here's a quick summary by mode of transportation. In ocean, the war in Iran effectively closed the Strait of Hormuz and choked shipping in the region. Shipments of oil, fertilizer, and aluminum were among the most impacted imports to the United States. This disruption has had a volatile impact on rates and shipping, with many avoiding the region because of the security risk and costs of war risk insurance. This has resulted in longer sailing times, reduced schedule reliability, increased fuel usage and costs, increased insurance premiums, and additional congestion at transshipment hubs. The fuel cost impact has spread beyond the Middle East, with European Far East sailing seeing 25% rate increases. Spot rates for Far East sailings continue to be high, causing many shippers to rethink their strategy for balancing contract rates and spot bookings. Overall, very challenging ocean shipping market at the moment. Next is air cargo, which has seen some mixed impact. The war in Iran temporarily closed certain airspaces to flights, with some estimating a temporary 20% decrease in available capacity. It also presents an ongoing security risk. Fuel costs and availability have also made it a pricier mode of shipment. However, there have been some positives. With ocean shipping struggling and economic conditions volatile, many have elected to leverage the air mode to move goods quickly and/or on short notice. There continues to be strength in the shipment of semiconductors and AI infrastructure, which are more appropriate for the air mode given high value weight ratios and time sensitivity. E-commerce continues to thrive, and air benefits from that because of short fulfillment cycles. Some inventory restocking strategies have shifted to smaller, more frequent orders, which switches inventory to air from ocean. Overall, despite the volatile impact of geopolitical tensions, air cargo has been relatively strong. Road transportation. Fuel and driver costs and driver shortages are having the biggest impact on U.S. domestic trucking. Smaller carriers are struggling, and it's pushing some capacity out of the market, but not enough to counteract the increase to shipping rates caused by fuel costs. Overall, we saw trucking volumes down 4% year-over-year. With that overview of transportation modes, the general theme is a tough and costly market to ship in. Our customers are increasingly relying on us and technology to deal with this complexity and uncertainty. One of the keys to our customers managing a more complex world and rising resource costs will be leveraging artificial intelligence technology. Our customers are looking to us to be a leader in AI to help them plan for and operate their future. I spoke about this last quarter, but here are some of the reasons they're confident in our success. We are a critical logistics network relied on by the world. We connect hundreds of thousands of companies. We solve complex inter-enterprise problems for them that they can't solve on their own within their own enterprise. We have scale. We process billions of transactions a year. We deliver a reliable and stable solution at scale. We're trusted by our customers. We help them with compliance, a function that is risky to handle solely internally without leveraging a specialist. We have workflow and domain expertise for complex logistics processes. We have unique proprietary data that can deliver, that can fuel better answers. Better answers mean increased operational efficiencies. We have a long record of investing in new technologies and businesses to enhance our service offering. We're financially stable and operate our business for the long term. We have a broad portfolio of solutions that are ideal for those who need integrated logistics and workflows and processes. Every day, we're advancing on our use of AI technologies for our customers. We've designed our AI agent layer that will accommodate external and Descartes agents accessing their functions and data on the Descartes Global Logistics Network. That layer orchestrates agents and the skills they call. It enforces policy, so it says who can do what and whose data, and under what approval. It captures audit and observability so that every action is traceable and explainable, and it manages the economics, the usage, cost, attribution, and billing. We believe there's lots of value to be delivered to our customers using AI agents. I mentioned the MacroPoint agent before, however, w e have a whole suite of transportation management agents, including calling drivers for location checks, gathering proof of delivery information for billing purposes, arrival and departure confirmation, getting truck rates to help with carrier selection, getting insurance certificates for carriers. We have similar agent development in other pillars, including agents gathering service time information and fleet management, research agent Datamyne, enhanced the sanctioned party screening to manage false positives, just to name a few. These agents are automating workflow and work. They're designed to automate repetitive tasks that don't need the creativity of a human and to surface new opportunities for humans to consider new strategies and opportunities. Some of the agents are sold to our customers, while others are designed to increase adoption, velocity, or traffic over the Global Logistics Network. We believe that AI agents, whether they're ours or third-party agents with permission to access our network, will play a big role in future efficient supply chain logistics operations. Because of that, we anticipate we'll continue to increase our level of investment in AI technologies. Some of that will come from increased usage of existing AI tools within our business to build out our AI agent layer, from building and designing new agents, from enhancing the functionality that we have in our existing customer applications, from rapidly accelerating the interoperability of our solutions, from making our network more secure and reliable, and from delivering a better customer experience. However, we also anticipate that our M&A strategy will include detailed consideration of how potential partners will enhance how we're using AI to help our customers. This past quarter, we completed the acquisition of Idelic, which brings new AI power technologies to our fleet management customers. Idelic helps our customers with managing the safety of their drivers. They have proprietary database of over 40 billion miles of data and telemetry on hundreds of thousands of historical accidents, which can then be leveraged to identify drivers or practices that may require further training or remediation to prevent future safety issues. That data is something that non-Descartes systems aren't trained on and allows us to provide better safety insights to our customers. When combined with Descartes industry-leading routing, planning, and execution technology, this enables us to deliver a complete cutting-edge fleet performance management solution that uniquely incorporates driver behavior and safety signals into our robust operational data set. A big welcome to the Idelic team. We're excited about what they can do for our fleet management customers. I provided an overview of our approach with AI technologies and some of our investments, however, w e're planning a comprehensive description of everything that Descartes is doing with AI in our in-person Innovation Forum to be held in Chicago, October 6th through the 8th of this year. This is a big event we invest in to provide our customers and partners access to our people, our latest developments and plans, and give an opportunity to provide direct feedback on where we are and where we're going. It's been a few years since we've done an in-person event of this scale, so w e're very excited to host everyone and share how excited we are about our future. Please see our website for registration details. In summary, a strong Q1 with additional AI investments and a new acquisition. I'm excited about how the business is performing and the opportunity we have in front of us. With that, I'll now turn the call over to Ed Gardner to go through the financial results in more detail. Ed? Thanks, Ed. As Ed mentioned, I will be walking you through our key financial highlights for the first quarter of fiscal 2027. We are pleased to report record quarterly revenues of $193.6 million, an increase of approximately 15% from revenues of $168.7 million in Q1 of last year. Our revenue mix in the quarter continued to be very strong, with services revenue increasing 15% to $180.5 million from $156.6 million last year in the first quarter. Services revenue represents 93% of total revenue this quarter, which is consistent with Q1 last year. Removing the impact of both the recent acquisitions as well as a positive impact from changes in FX rates, we would estimate that our growth in services revenue from new and existing customers, that is our organic growth, would have been just over 9% this quarter when compared to the same quarter last year, and t his is up from approximately 8% organic growth in Q4. Professional services revenue and other revenue, including hardware revenue, came in at $11.5 million or 6% of revenue, slightly down from $11.8 million in Q1 last year, while license revenues came in a bit higher this year at $1.6 million versus $0.3 million last year. Collectively, our professional services and other revenue, combined with our license revenues, was up 8% this year and together, remain approximately 7% of our total revenues. Gross margin came in at 78% of revenues, up from 76% in Q1 of last year. The increase in gross margin for the quarter was primarily due to operating leverage from more organic growth in services revenue. Turning our attention to the bottom line, as a result of solid revenue growth, improved gross margin, as well as controlled growth in operating expenses, adjusted EBITDA came in at a record $ 89.8 million in the first quarter, or approximately 46% of revenue, up 20% from adjusted EBITDA to $ 75.1 million in the first quarter last year. From a GAAP earnings perspective, net income for the first quarter came in at $ 48.5 million, up 34% from net income of $ 36.2 million last year. With these operating results and strong collections from customers, cash flow generated from operations came in at $ 75.1 million or 84% of adjusted EBITDA, up 40% from operating cash flow in the first quarter last year. Overall, as Ed Ryan mentioned earlier, we're extremely pleased with our operating results in the quarter. If we look at the balance sheet, our cash balances total $377 million at the end of April. As I just mentioned, we generated operating cash flow of just over $75 million in the quarter. Offsetting that was approximately $30 million in capital deployed on two tuck-in acquisitions and approximately $21 million on share buybacks under our Normal Course Issuer Bid. As we look ahead, we remain well-capitalized and ready to continue to work on potential M&A activities in our space. A couple of more points as it relates to the remainder of fiscal 2027. Going forward, we expect to continue to see strong operating cash flow conversion north of 80% of our adjusted EBITDA, of course, subject to unusual events and quarterly fluctuations, including adjustments related to future earn-out payments that exceed our estimates made at the time of an acquisition. After incurring approximately $2.6 million in capital additions in the first quarter, we expect to incur approximately $4 million- $6 million in additional capital expenditures this coming year, mainly related to IT equipment purchases. After deploying approximately $21 million on share buybacks in Q1 2027, we also note in our shareholder report that we purchased an additional 196,800 shares between May 1st and June 2nd, and w e may see additional purchases under the NCIB program moving forward. After incurring an amortization expense of $17.3 million in Q1 this year, we expect the amortization expense will come in at $53.5 million for the remainder of fiscal 2027, with this figure being subject to adjustment for foreign exchange changes and any future acquisitions. We estimate that payments of contingent consideration for earn-out arrangements for the balance of this year could be up to approximately $9 million, subject to any necessary adjustments resulting from the final earn-out calculations. Our income tax rate in the first quarter came in within our expected range at approximately 26% of pre-tax income, in line with our blended statutory tax rate of approximately 26.5%. For the remainder of fiscal 2027, we're expecting the tax rate will be in the range of 25%-30% of our pre-tax income, which means it will be something on either side of our blended statutory tax rate. However, as always, we should add that our tax rate may fluctuate from quarter to quarter from one-time tax items that may arise as we operate internationally across multiple countries. Finally, after incurring stock-based compensation expense of $7 million in the past quarter, we currently expect stock compensation to be approximately $24 million for the remainder of fiscal 2027, subject to any forfeitures of stock options or share units. I'll now turn it back over to Ed Ryan to wrap up with some closing comments and our baseline calibration for Q2. Hey, thanks, Ed. As I mentioned earlier, it continues to be a challenging shipping market in large part because of the Iran war's impact on moving goods and tariff uncertainty that is ongoing. We expect that to be challenged throughout our Q2. There are also three new things impacting the market that I thought I should flag. First is tariff refunds. Earlier in the year, the Supreme Court invalidated the IEEPA tariffs that had previously been imposed by the U.S. administration and required the tariffs that had been paid be refunded. That refund process is now in progress, with some customers reporting that they're in partial receipt of funds. Where their businesses receive these funds directly, depending on whether they were paid directly or via broker, they may very much provide money for investments that weren't contemplated when the tariffs were in place. There may be the potential for new technology investments opportunities for us with U.S. importers. The second is broker liability. The U.S. Supreme Court has been unusually active in things that impact shipping. Recently, they determined that a freight broker may have liability for the negligent selection of unsafe carriers. This makes it very important for freight brokers and others selecting carriers to ensure that they're doing due diligence while hiring trucks to drive loads for them. We're able to help our customers with that using our transportation management systems, and more specifically, our MyCarrierPortal solution that performs checks on the suitability of potential carriers. Separately, we expect that there will be pressure on smaller brokers in the market as they consider the cost of performing auditable diligence and increased insurance requirements to something that may ultimately impact the number of brokers that are in the market going forward. The third is new China regulations. There's new regulations from China designed to counteract what they consider to be proper extraterritorial jurisdiction of the regulations of other countries. For international shippers with supply chain operations with ties to China, this could mean needing to navigate a web of conflicting regulations between China and other countries. For example, a U.S. regulation against forced labor may prohibit U.S. entities from doing business with certain entities, while a Chinese regulation may prohibit a Chinese organization from complying with the U.S. regulation that China considers to be extraterritorial. Just flagging an area of increased complexity for our customers going forward, and one that will require even more attention to the importance of global trade compliance solutions. It's a challenging macro environment for shipping, with new things that come in to make it an even ever-changing landscape for our customers. We keep this in mind as we think about how our business is financially positioned and calibrated. In our quarterly report, we provided a comprehensive description of baseline revenues, baseline calibration, and their limitations. As of May 1st, 2026, using foreign exchange rates of $0.74 to the Canadian dollar, $1.17 to the euro, and $1.36 to the pound, we estimate that our baseline revenues for the second quarter of fiscal 2027 were approximately $169 million. Our baseline operating expenses were approximately $102 million. We consider this to be our baseline adjusted EBITDA calibration of approximately $66.5 million for the second quarter of fiscal 2027, or approximately 39% of our baseline revenues as at May 1st, 2026. We're currently, excuse me, w e're currently operating above our expected adjusted EBITDA operating margin range of 40%-45%. Our margin can vary in any period, given such things as revenue mix, foreign exchange movements, and the impact of acquisitions as we integrate them into our business. For now, we're keeping our target range as 40%-45%, however, w e'll monitor how we're performing over the coming quarters to consider whether any upward adjustment is appropriate. These remain uncertain times for our customers. It's a challenge for them to know what they can rely on in this global trade environment. Our goal is to continue to show our customers and other stakeholders that one thing they can rely on is Descartes. Thanks to everyone for joining us on the call today, and as always, we're available to talk to you about our business in whatever manner is most convenient for you. With that, operator, I'll now turn the call over to you for the Q&A portion of the call. Thank you. Ladies and gentlemen, we will now begin the question- and- answer session. To ask a question, you may press star followed by the number one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star followed by the number two. One moment, please, for your first question. Your first question comes from the line of Dylan Becker with William Blair. Please go ahead. Hey, guys. This is Jackson Bogli on for Dylan Becker. Ed Ryan, I think what's interesting is we've got so many different things going on with geopolitics, excuse me, and just changing supply chains overall. Could you maybe try to contextualize at what point would that actually turn into a headwind for Descartes instead of it really driving interest on the platform? Just anything you could say about, you know, is there a point where the complexity gets too much and it starts to become a headwind for your business? Well, I think it's not so much that the complexity gets to be too much. Most of the complexity helps us regardless of how much there is. The more there is, it tends to be the more they use our software. What we've seen in the past, and you can probably see it as well if you look back, if the complexity gets so much that it starts to harm the economy, we go right along with the economy pretty well. When the economy's down, people are shipping less stuff, and we don't do as well. You saw that with the tariffs last year, I mean, t he U.S. put a whole bunch of tariffs in place, t hey were surprising to everyone, n o one knew what was going to happen next. There was a lot of uncertainty day to day and what was going to happen, and it caused people to freeze. I think with everything that was going on with AI at the time, and even today, you know, we didn't end up in a recession because there were lots of good things going on in the economy as well. But make no mistake, people weren't shipping stuff as fast as they could have because they weren't sure what to do about these tariffs, t ariffs that were now subsequently invalidated and all for naught in effect. No one ended up having to pay these rates, or in theory, no one will end up having to pay them. At the same time, that complexity caused them to slow down their shipping decisions. While we were benefiting on the one side from tariffs and duty rate provision, we were suffering along with everybody else when there weren't as many shipments moving around the world. That's when it hits us. I don't think it's increased complexity that necessarily hurts. It generally keeps helping us no matter how much there is. If it leads to a depressed economy, it hurts us and everyone else. Got it. I think that makes total sense. Maybe for Ed Gardner. You guys have a really good capital position. You have the line of credit, really good cash position. It seems like there's multiple areas you could focus on for investment in the business and capital deployment. I'm just curious how you're thinking about the M&A landscape with the depressed valuations we're seeing, as well as continuing to invest in the platform. Just curious to get any thoughts on how you're thinking about capital deployment going forward this year? Yeah. I don't think it changes that much from other years. Obviously, with the ability to build more stuff faster with AI, that changes the calculus somewhat. Absolutely, when we're looking at our buy versus build decisions, but t he framework remains similar, right? We're still looking for great businesses that have some sort of proprietary unique data and deep domain expertise and very sticky customer base. We're looking at capital allocation now. I think we see the opportunity to build more, build faster, produce more for our customers, and that changes how we look at some of the acquisitions, but there's still a lot of great targets out there. I'd say we're very busy and actively engaged looking at them. Maybe just to comment on the valuation side, from a valuation perspective, it's quite not unusual for the private markets to not necessarily go completely in sync and not necessarily as quickly as the public markets. As the prices come down, it's not necessarily at the same pace, but we are certainly seeing them come down a bit and we remain engaged in a lot of opportunities right now and lots of discussions. Got it. Super helpful. Thanks, guys. The next question comes from the line of Chris Quintero with Morgan Stanley. Please go ahead. Hey, guys. Thank you for taking my questions here. I wanted to ask about the quarter here, third consecutive quarter of organic growth acceleration. Really great to see. You all called out some challenges here, specifically called out Q2. Could you help clarify, like, do you expect some of these challenges that you've highlighted to impact the growth rate, or are these really more opportunities for you to leverage your network to address some of these additional complexities that your customers are seeing? If you know us, we're pretty cautious. We probably spend more time telling investors about the risks than most companies do in the software space. But you're right, things are going well right now, and I see a lot of potential for them to continue to go well in the future. Still, even in this past quarter, this is a great quarter for us. We were 9.5%, something like that, organic growth on services. That's great. And we were doing that in a down freight market. For the future quarters, I'm pointing out that, hey, we're still in a down freight market. I don't know what's going to happen exactly either, but we're doing okay, considering, and we're happy about that. But, you know, it'd be nicer if everything was coming up roses. Just knowing us, we're always quick to point out the risks and stuff and make sure that we're always doing what we said we would do. You see that in many of the ways that we produce our numbers. We're pretty conservative. I think that's what you're seeing. Got it. Okay. Mostly just conservatism here, highlighting some of the risks, but obviously the business is doing pretty well here. As a follow-up, really great to hear more of the momentum around your AI and agents. How are you thinking about the go-to-market motion as you start to roll some of these solutions out? It seems like a lot more software vendors are starting to pursue more of a forward deploy engineer type of model to help sell some of these solutions into customers. I'm curious how you're thinking about that on the go-to-market side. Well, we think we have a lot of solutions that we can go out and sell to customers, and we are. We're starting to get traction doing that. We have a lot of solutions that improve things for our customers internally without them really having to sign up for anything new. If they're paying me to process a shipment, and I have some tool that figures they need to process a new shipment here because they had a problem with an existing shipment, and I already have a contract in place to do it, I don't have to sell them anything new. The agent that I mentioned earlier in the prepared comments, that agent's job is to get more truckers online, and each trucker I get online is going to be able to help me track a shipment that's going to get me a couple bucks a shipment. Now that he's signed up, every time he gets a shipment, I'm going to be able to track it. It's the gift that keeps on giving. We have agents calling these truck drivers, and you have to call them in the beginning of the move. You can't call them with 20 minutes to go on the move and start asking them to download the mobile app. You have to get to them quickly. Frankly, three years ago, we just weren't able to keep up, at least not cost effectively. Now, all of a sudden, we can call the guy within minutes of him taking off, p icks up a load and we're calling him right away going, "Hey, can I track that load for you? Why don't you download the app and I don't have to call you anymore? I was supposed to call you every hour, and if you download this mobile app, I never call you again." That's a pretty compelling argument for the truck driver, especially when he knows he's been tracked by MacroPoint in the past. It's a known name to him. We're the largest in the industry. That alone has moved our track rates from 87% six months ago to 93% and moving higher. Each one of those percentage points is a lot of $2 shipments that end up producing revenue for us, and so t hat's great. I don't have to do anything, and I'm just helping our customers, and they're paying more, and they're happy about it because they're going to track more shipments. And then finally, there's the stuff internally, right? Where we're able to build stuff faster, the ideas come out. You heard us talk about this whole AI layer where we can more closely pull people into the network and in an organized way do that. That saves us money. It saves our customers money. It makes it easier for them to use their network. It makes it easier for us to provision services to them that they pay for. I know the market thinks, oh, AI is going to harm software companies. I go, I don't know if I'm a software company, I mean, w e have software, but I don't know if I'm quite the software company the way everyone else is. We think of ourselves as more of a network data content, p rovision type of business, and that means we have a lot of proprietary data that can help customers make good decisions in the future. Frankly, if you look at our network, I know where all the shipments are supposed to be over the next month. That's pretty valuable information when things start getting messed up or screwed up in the supply chain, and decisions need to be made quickly that can save a customer a lot of money. I can use AI to do that because I have all the data, and no one else does. I go, "I don't know what people think is going to happen to everyone else, but I'm pretty sure we're going to benefit from that," and we're excited about it. I'll leave it at that. Excellent. Thanks so much, Ed. Thank you. The next question comes from the line of Lachlan Brown with Rothschild & Co Redburn. Please go ahead. Hey, Ed. Ed, thanks for the question. Yeah. You mentioned that the Q1 came in ahead of plan, noting the robust organic services revenue growth of greater than 9%. Could you just dive into the drivers in the quarter that led to the delivery above your prior expectations? Well, again, I covered it pretty well in the beginning of the call. Global Trade Intelligence business did very well, as you might have expected. In our e-commerce shipment business, what was formerly Type 86 filing has been booming lately. I mentioned on previous calls, you know, w e had 40%-50% of that market, and when the switch from Type 86 to Type 01, a lot of our competitors couldn't handle the speed with which those transactions had to be filed. They weren't really networks, t hey were software companies that were making these filings, and when they had to do it a different way, their networks fell apart and had a lot of those customers switch over to us so that we got a lot more market share out of it, and it's been a great business for us in the last year, and I suspect for a long time to come. Our fleet management business has been doing well, as it has for many quarters now. Our transportation management business led by MacroPoint has been doing great. In a down market, they were still picking up a lot of momentum and a lot of new shipments. Both signing customers and that agent that I talked about, that move from 87% to 93% is significant. That's a lot of money, and even in a down market, we were able to pick up more revenue than ever. All that's added up to pretty good news for us. That's helpful. Thanks. I wanted to ask you, in recent months, we've seen a few of the larger global logistics players double down on their technology investments and their longer-term AI strategies. I was wondering if you could provide some color on what you're seeing in the mid-markets in terms of their pace of AI adoption. How are they responding to these larger players? Just any color on what conversations you're having on how Descartes can support them. As you might expect, it's very helpful to us, right? We help the bigger players in a lot of ways. They're oftentimes our biggest customers, but then, the mid-size and smaller players have to keep up. While the big players can build some of the stuff themselves, like the back-office systems, the medium and small-time guys really can't do that, and they need tools from people like us that help them keep up. I would always say to people, customers would say, "I want a strategic advantage in my, you know, w e're using software in my company," and I go, "Okay, great." Here's a bunch of stuff you could use to do that. But bear in mind, this isn't going to last forever, right? It used to be, seven years ago, if you had MacroPoint, you had a big selling advantage against the broker that didn't. Well, you don't have that advantage anymore. You have to have it now, right? Everybody has this ability to track a truck. They're onto the next thing now, right? That's good for us, right? We can keep building tools that help people service the customers properly. When everyone has those tools, it becomes table stakes to a certain extent, then we have to go give them new tools to help them make the next advancement. I don't know that we're driven that way by big forwarders all the time, and we probably drive the advancements as much as anyone. But sometimes people can build it themselves. Depends on what we're talking about. If you're talking about a network service, they don't, and they can't really build it themselves. If you're talking about a back-office system, sure they can. They buy some stuff from us, they buy some stuff from other people, and they put it together, and they have their whole back-office infrastructure. As soon as they get out to need to communicate with other people, all bets are off, right? They have to use a network like ours. They'll never be able to replicate our network. When I think of the big guys, the FedExes, the UPS, the DHLs, even the Amazons that like to build a lot of stuff themselves, well, they always end up in this situation where like, yeah, sure, but you can't do it with a network, right? The number of connections you need to maintain it is not feasible. It's much more cost-effective for someone who's neutral like us to do it for everybody and charge everyone a low rate to do it as a result. That advantage has been the case for 25, 30 years, and I think with AI, it's even going to be more so, right? Most of the small AI players that we talk to that seem to be more like features than companies, they're coming to us going, "Hey, can I join your network?" I'm like, "Well, not really. You don't have a customer." A customer needs to join a network. If they're using your software and they want to do it, no problem, but I'm not going to just help you guys get business by giving you access to our network. It doesn't work that way. The whole thing's interesting, and I think AI is going to even further separate things to our advantage. That's how we see the playing field playing out with regard to your question. Makes sense. Appreciate the call. Thanks, Lachlan. The next question comes from the line of Stephanie Price with CIBC. Please go ahead. Hi there. It's Sam Schmidt on for Stephanie Price. Thanks for taking my question. EBITDA margins have been tracking towards the top end of Descartes target range for several quarters. How do you think about this going forward? Can you talk a bit about how you're leveraging AI internally, and how you're tracking progress on those initiatives? Thank you. Sure. Yeah, we're up at 46% right now. We said the range is 40%-45%. If you watched us do this in the past year, we usually blow through a number a couple quarters before we start to move it up. I think you'll see the same here. The things that can affect it are, the big things are FX and acquisitions. We're up at a pretty lofty EBITDA margin now. We're not going to find many acquisitions that will be accretive to our EBITDA margin. Not that that's a problem, it's just that if I buy some company that makes 25% EBITDA margins, and with plans to increase it, that's great for our shareholders as long as I pay the 25% price for it. But it also drags my 46%, which is a decent-sized company, down to 44%. I don't want to up it to a number that we're going to miss. We want to provide consistent answers to our shareholders. If we tell a number, we are either in that range or we beat that range. I'm not going to apologize too much for beating it. We're only beating it by a point right now anyway. But I don't want to mislead people. With regard to AI in relation to this, yeah, we're seeing, we're way more efficient, or let's just say we can produce a lot more stuff with the people we have. We'll see how this plays out, but I think right now, we're going, you know, while I see other people laying employees off with, "Hey, I'm using AI and now I don't need as many employees," I think we're inclined to go the other way right now and saying, "I'm using AI and it's producing a lot of productivity enhancements, and I'm using that to produce more software." We have that luxury because we're in the 45% range or 46% range right now. If someone's in the 25% range and competing with us, they're at a significant disadvantage, especially if they're trying to do the same thing we are, which is use our profits to buy more companies. Well, if you're making half of my profit, you're not going to be able to do that as effectively as we are. We're inclined to take the extra right now and produce more software for our customers and make sure that we continue to be a leader in this space as a result. I don't know if that changes in the future. Maybe I'd have to take a look at it over time, but r ight now, I think we have a lot of good ideas, and more good ideas than we have time to produce them. Why would I use it to cut any cost? I think I'm using it to produce more stuff because I think that stuff's going to produce more revenue for us in the future, and we're excited about that. That's good color. Thank you. Maybe one more from me on market share gains in the quarter. Can you comment on how those contributed to organic growth and how you're thinking about opportunities to take share at this point? Yeah. I've mentioned this in previous calls. I don't want to get into naming competitors and stuff like that, but we, certainly in, that TMS space, in the routing space, some of the things where we're the market leader. Times have been tough over the last year for a lot of companies, but I have 300, 400 different products to spread it out over, and we're not materially harmed even when things got tough. Maybe things were tough a year ago, and I went, "Yeah, they were tough, but we're still making $90 million a quarter." Let's not kid ourselves. We're doing okay. We have competitors out there that when we take business from them, they only have one product. That's their stuff. A lot of these guys are high flyers that have never seen a situation where they were shrinking. All of a sudden they are, and it causes real problems inside the company. The stock's not worth what it was. Their shareholders are furious, and their shareholders overpaid to be in the business. Their employee stock's not worth anything anymore. They can't believe that they were worth $2 billion at one point, and all that happened was their growth rate went from 30% down to almost zero, but everything else was still fine. When it went down, they had to stop growing. They stop growing, they stop having the money to buy any more stuff. They had to start cutting costs. Usually the guys that are high flyers are not good at cutting costs. They really struggle to do it, and they just can't imagine. All those things add up to help us quite a bit. That whole company gets demoralized when that happens. Fortunately for us, we're not in a situation where we're facing anything like that. Even when times were tough last year, they weren't that tough for us. Most of the business was still looking up. I think it's a testament to the things that our guys have built. They built us something big that solves a lot of problems and had the chance to succeed in many areas. Even when times are tough, some of our business is doing great. Not everyone has that luxury. Thanks for taking my questions. Thank you. The next question comes from the line of Mark Schappel with Loop Capital Markets. Please go ahead. Hi, thank you for taking my question. I was wondering if you could just walk us through the key puts and takes you observed in the air cargo business this quarter that you referenced in your prepared remarks. Then also, with respect to that, you also noted that your trucking business is down about 4% year-over-year, w hat would that decline translate to in your ocean shipping business? Oh, okay. I got you. Let's talk about the air one first. The Iran war, especially in the beginning, had a lot of flights not being allowed to fly over Iran and or let's say anywhere over that area. You've got Emirates there, you've got Etihad, you've got several of the biggest air cargo carriers in that region. There's like a third of the map they can't fly in that direction when they're right there. I mean, they're in Abu Dhabi and Dubai or whatever. It's tough for them. They had a lot of flight cancellations as a result. They started moving planes around. That's tough, right? It doesn't happen right away, you have passengers that are expecting to be on one type of flight, and all of a sudden, that flight's not available anymore. The cargo goes along with it. So that was a headwind for the air business. At the same time, some of the stuff that we mentioned in ocean, people get into these situations or companies get in these situations and they go, "Oh." There's a lot of cargo that sits in the middle, right, where they go, "I could fly it air or I could move it ocean," depending on what's going on. I think for a while, people started gravitating towards air in that situation because if I was just describing the air carriers in a bit of a pickle, the ocean carriers were in a much worse pickle. They're like, "We have to avoid that entire region." Okay, great. Well, the option then is to go around the Cape, South Africa, the Cape Horn. Well, that's 10 more days. They started charging more for the stuff. If you're the shipper, you're thinking, "Well, geez, the air shipment is usually way more expensive, and now it's not that much more expensive because the ocean carrier is charging a lot of money." That ended up being a little bit of harm to ocean carriage but also took some capacity out of the ocean space and helped them raise prices, so maybe they didn't suffer as much. The air carriers were able to pick up some business, which is great for them. On the truck side, probably to answer your question, that 4% down probably doesn't translate that much in the ocean space. It's mostly probably related to domestic shipping. I'd be guessing if I told you, but if I had to guess, I'd say something like a half a percent. Nothing big. Yeah, just to clarify on that, we were talking about the truck market in the U.S., not the Descartes truck market or transportation management business. Great. Thank you. The next question comes from the line of Kevin Krishnaratne with Scotiabank. Please go ahead. Hey, guys. This is Richard on for Kevin. Thanks for taking my questions. Amazon, they launched Amazon Supply Chain Services earlier in May. I was wondering, does this more fragmentation and multi-carrier complexity drive more demand for your solutions, or do you see any risk of it potentially displacing parts of your value chain? No, they're a big customer of ours. We don't compete with any forwarder, freight management capability. We purposely don't do anything to compete with them. We're trying to help them, and we've seen over the years, we've had competitors many times say that they're going to do something that their customers do, the freight forwarder does, or the 3PL does, and they get killed for it. We've very aggressively stayed out of that, trying to remain neutral, and we're trying to help them all. Amazon's a big customer of ours, and we do business with just about every freight forwarder in the world. So, no, t hat to me is Amazon getting into this business. We already do a lot of stuff with them. I suspect we'll end up doing more because we do a lot, especially with the bigger freight forwarders. We tend to get big relationships with them, and we'll see how they get into it. Do they buy someone along the way? That oftentimes helps them get going. Saw that with Uber. Uber, when they started, was like, "Oh, we're going to do all this stuff ourselves." Then a year in, they buy one of the bigger players in the industry, and h ere we are today, four or five years later, and they're one of our biggest customers. If you had listened to them seven, eight years ago, you would've thought they would never do business with someone like us, ever. Of course they would. The reason they do is because there's certain things we do better, faster, and cheaper than they'll ever do. They would be smart to do it with us, and I think you'll see the same with Amazon. Okay. Can you also unpack a little bit more about what's driving some of this strong GTI growth? How much of the growth is from new customer wins versus existing customers accessing more databases versus pricing? It's not pricing stuff. Pricing's largely the same. I don't know if I know the exact breakdown, but i t's customers saying, "I need more information. I need more countries, I need more commodities, and I want to search more stuff." That's largely they're doing that because the tariffs are coming in, or tariff changes are coming in. As I would always say, we actually joked about it today before the call, if they never changed, we'd be selling a book. Because they change every day, we're selling access to a database. When Trump comes in with his [audio distortion] move and changes everything, then people tend to go into that database a lot more and start looking around and going, "What do I do about this? How do I plan to save myself money?" That's how it goes for us. Sometimes they're new customers. A lot of times they're existing customers that are buying access to more of the database. We sell it in chunks to them by country, by commodity. They buy more, and we give them access to more so that they can make better decisions. That's helpful. Thanks for taking my questions. Thank you. The next question comes from the line of John Shao with TD Cowen. Please go ahead. Hey, guys. Thanks for taking my question. I understand GTI has been a strong growth driver this quarter. Earlier this year, key investors' concern is your customer might use AI to replicate the same GTI database. Do you think this quarter's growth effectively de-risked that concern? Yeah, I didn't have a concern about it in the first place. We heard that and said, "I don't think the people that are saying it understand how this works." I went over it in the last call in some detail. We have a massive amount of data that we have to collect, and it's from all different countries, and it's not that easy even to train an AI agent to do it. If you look at the way that we've done it is using AI strategies that we've built ourselves over the last 15 years. Maybe off-the-shelf tools would help us do it today, but it doesn't matter. We've built them already. That's how we grab the data. We have to put the data into a database in a similar format for everyone. We have to make Belgium look the same as the Netherlands, look the same as Japan, et cetera. That's hard. We have to build ways to disperse it to the customers, and you could just say, "Here's the data," but it's much more convenient for them if we say, "Oh, here it is in the Oracle format, so I'll just throw it right into your database over there seven times a day." That's a whole set of things. You have maybe one of the more compelling arguments, which is, we don't charge that much. Because we do it for everyone, the price per customer is pretty cheap. There's no one customer that's like, "Oh, for the $50,000 I pay you a year, I'm going to do this myself." Well, that math doesn't work. You're not going to be able to do it better, faster, cheaper than us, and even close. If I could just give you a little, like, Amazon uses this. Trust me, if they could replicate it themselves, they would. Anything they've ever been able to replicate themselves with us, they do. This is not one of them. It's just not feasible. Finally, if you get it wrong, it's a real pain in the neck to get your money back. If you got it wrong because you built your own AI system, the government's not going to like that answer. They want to hear that you were trying to do it properly, and, "Oh, I built my own AI tool and it was wrong," is not a compelling argument. It's not a compelling argument with tariff stuff, and it's really a bad argument with the sanctioned party stuff. People tend to do those things together with us to make their global trade management system work. If you add all that stuff up, people said that to us, and I kind of laughed. I intrinsically knew that wasn't what's going to happen because of what I just described to you. It's just too much to overcome. If my best friend told me that he was going to do that, I would say, "Don't do that. You're wasting your time. Go with someone. Go with Descartes, it's going to be better, faster, cheaper. You should go focus on your core business, not on building your own tariff database. It's not going to be worth it." Got it. That's great color. Thanks. I'll pass along. Thank you. The next question comes from the line of Robert Young with Canaccord Genuity. Please go ahead. Hi. Good evening. Just a couple of questions on the AI agent layer you're highlighting. I am trying to understand, one, how an external party would access that. Is that like a Model Context Protocol to use through one of the, like Claude or something like that? Is it something that you are setting up specifically for your larger customers to access your data? Yeah, sorry. Yeah. It is that. It is ways for our tools and our customers to say, "I want some information out of here." It's a set of protocols that you would use to make calls to our AI tools to disperse data to you quickly and efficiently for use in an application, to answer customers who might be on an automated phone call or coming into your website. You might be able to quickly call us, and I give you an answer that spits right out to your customer in a split second. You pay for that. Right. You said that you put a policy in place that determines what these parties can access, how they access it. Yeah, yeah. And you're auditing it, so t here's a monetization strategy. That sounds like a foundation for monetization. Is there any additional detail you can provide around that? Well, think of it like, our network has these tools. They're going to get a whole lot better with a whole lot more stuff you can request from them. Our network already does this conceptually. It lets you get access to a bunch of things, the ability to get tracking messages, the ability to make a booking, to get a booking confirmation back, to make a filing to a government, to get a filing confirmation so that your plane can take off. Imagine if I add a 1,000 more things to that that I can serve up to people, and they each cost $0.25 or whatever. That's how we imagine it working. Okay. Last question. You said that there were some strategies to increase adoption and velocity on the GLN with this layer. Yeah. Maybe bring new customers into the network. It feels though you've got most of the large customers, and so I'm just curious what types of strategies? Getting them to do more with us, right? It's easy for us to see because we do business with all of them. It's going to bring huge opportunities for them to better service their customers and charge them more. Hand in hand with that, same for us. I go, our customers could be providing much more information to their customers about what's going on in their shipments and get more money from doing it. Because they're saving them money and finding them more efficient ways to operate. As a guy that serves that up, I may be charging $0.25 for giving this out. They maybe charge $10, right? Their customer goes, "Wow, that was really worth it." I go, "Wow, I made a lot of money at $ 0.25." Our customer goes, "Well, I just made $ 9.25 on this idea that Descartes gave me." Right? Now, my customer's happy, and they're paying more money. I go like, "I think we're going to see more and more of this all over the place." Because of our network, I think we're in a very, very good position to do it. We're excited about that. Okay, great. Thanks for answering my questions. Hey, thank you, Robert. Have a good day. I'm showing no further questions at this time. I would like to turn it back to Ed Ryan for closing remarks. Hey, thanks everyone for your time today, and we look forward to reporting back to you in September. Appreciate your time today, and we'll talk to you soon. Thank you. Ladies and gentlemen, this concludes today's conference call. Thank you all for joining. You may now disconnect.