Good morning, and thank you for holding. My name is Ryan, and I will be your conference operator today. Welcome to Alight's second quarter 2024 earnings conference call. At this time, all parties are in a listen-only mode. As a reminder, today's call is being recorded, and a replay of the call will be available on the investor relations section of the company's website. And now, I would like to turn it over to Jeremy Cohen, Head of Investor Relations at Alight, to introduce today's speakers. Please go ahead, sir. Good morning, and thank you for joining us. Earlier today, the company issued a press release with second quarter 2024 results. A copy of the release can be found in the investor relations section of the company's website at investor.alight.com. Before we get started, please note that some of the company's discussion today will include forward-looking statements. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those expressed or implied in the forward-looking statements due to a variety of factors. These factors are discussed in more detail in the company's filings with the SEC, including the company's most recent Form 10-K and Form 10-Q, as such factors may be updated from time to time in the company's periodic filings. The company does not undertake any obligation to update forward-looking statements. Also, during this conference call, the company will be presenting certain non-GAAP financial measures. Reconciliations of the company's historical non-GAAP financial measures to their most directly comparable GAAP financial measures appear in today's earnings press release. On today's call, when we refer to ARR, we are speaking of annual recurring revenue, which is derived from long-term contracts with high retention. We see ARR as a key metric in understanding our top-line growth and will provide transparency to ARR bookings and ARR revenue. ARR revenue may vary based on overall client headcount, as our pricing includes revenue per employee. On the call from management today are Stephan Scholl, CEO; Jeremy Heaton, CFO, and Greg Goff, President. Dave Guilmette, Alight's vice chair, is also with us today. After the prepared remarks, we will open the call up for questions. I will now hand the call over to Stephan. Thanks, Jeremy, and good morning. Alight had a transformational quarter where we delivered on key strategic milestones. We continued to accelerate our go-to-market momentum, completed our 2-year cloud migration program, and now begin a new chapter as a simplified company with higher margins, greater capital efficiency, and a stronger balance sheet. With the sale of our payroll and professional services business, we gain a new commercial partner and retain a superior financial model. Our adjusted gross margins are 350 basis points higher at over 40%, and Adjusted EBITDA margins have increased from 21.7% to 25%. Our singular focus is on our differentiated, technology-rich benefit services business, with long-term annual recurring revenue, higher margins, and improved cash flow. We are an industry leader with 4 decades of experience, serving 70% of the Fortune 100 and half of the Fortune 500, and we have created a better experience for our clients and their employees with the Alight WorkLife platform, creating a more valuable and durable enterprise. Deal proceeds were better than planned, and we retired $740 million in debt, reducing our net leverage to 2.8x on last 12 months Adjusted EBITDA. We also announced $155 million of share buybacks, which will retire over 3% of our shares. Completing our cloud migration program has removed decades of tech debt and will generate $75 million of annual run rate cost savings, which is a key component of our additional gross margin and Adjusted EBITDA margin expansion to 28%. We continue to win in the market with our transformed go-to-market strategy. We delivered 9% growth in ARR bookings in the first half of this year, including great wins this quarter from UPS, Wayfair, American Honda Motor Co., Inc., and The Adecco Group. We see strong demand for our high-value solutions and expect double-digit ARR bookings growth in the second half of 2024 and continued growth thereafter. Our second quarter results were in line with the expectations we laid out last quarter, and for our core ARR business, we expect sequential growth through the second half of 2024. We see increased cost consciousness and lower client demand for our non-recurring project-based work, which, as a reminder, is less than 10% of our revenue. This influences how we think about 2024 and have updated our revenue outlook accordingly. Within Alight's core ARR business, we expect sequential revenue improvements quarterly through to the end of 2024, and ARR is over 90% of our revenue and comes from long-term contracts with relationships that span decades with some of the world's largest and most complex companies. As Jeremmy will outline in more detail, we have $ billions of revenue under contract through 2026 and beyond. We are intensely focused on accelerating ARR with our transformed go-to-market model and by ensuring our clients and their employees have an extraordinary service experience. Our revenue under contract, focus on client retention, and high-quality ARR bookings growth will yield revenue growth of 4%-6% annually over time. Our transformed business will generate Adjusted EBITDA margin expansion from 21.7% in 2023 to 25%-26% in 2024. We also reaffirm our midterm Adjusted EBITDA target of 28%, over 600 basis points of margin improvement, and we are also reaffirming our midterm guidance on operating cash flow conversion of 65%-80% and maintaining net leverage of less than 3 times. We are confident in this guidance, independent of top-line growth. In line with the closing of the divestiture, and after almost 5 years in my role, it's the right time for a new leader to take the company forward in this exciting next chapter. I'm very proud of what we've accomplished during my time, including taking the company public, our cloud transformation with the Alight Worklife platform, and now with the sale, Alight is a new company, simplified and focused, with a tremendous opportunity ahead. The board and I have been succession planning for months, and we've announced today that I will step down when a new leader has been named. In the meantime, I will continue to lead the company alongside our highly experienced management team. Dave Guilmette, Vice Chairman of Alight's Board of Directors, will work closely with me to support an organized transition. I want to thank all of our colleagues around the world for their tireless efforts to deliver on these key milestones and delivering for our clients each and every day. Jeremy, over to you. Thank you, Stephan. Good morning. Before I get into the quarter, I have a few notes on presentation. First, the payroll and professional services business is included in discontinued operations. As you review the split between continuing and discontinued operations, I would note that we believe the continuing operations income statement understates the true earnings power of Alight. In the presentation filed this quarter, we highlight the accounting view of continuing and discontinued operations and also include certain pro forma supplemental financial information, which aligns with the normalized view of historic information we provided investors on July eighteenth. We believe this normalized view better reflects our go-forward wellbeing and benefits business, and that is what I will speak to today. Second, when we refer to ARR, we are speaking of annual recurring revenue, which is derived from long-term contracts with high retention. We see ARR as a key metric in understanding our top-line growth and will provide transparency to ARR bookings and ARR revenue. ARR revenue may vary based on overall client headcount, as our pricing includes revenue per employee. First, I will cover our commercial progress. Last year, we realigned our go-to-market structure to drive more sales intensity and greater demand generation. Our teams are incentivized to sell high-quality ARR, which flows into our long-term revenue under contract, and we are now seeing the results. Our ARR bookings were up 9% in the first half versus prior year. We also see a stronger ARR pipeline and an 8% increase in our win rates through the first half. Based on our current pipeline, we expect double-digit ARR bookings growth in the second half of 2024 and continued momentum thereafter. Now let me turn to our second quarter performance on a pro forma adjusted basis. Total revenue was $550 million, a decline of 2% when excluding the impact of the exited hosted business, which represents a 100 basis point improvement versus the first quarter. BPaaS revenue increased 12.7% and represented 21% of total revenue for the company. Adjusted gross profit was $219 million, with adjusted gross margin of 39.8%. Adjusted EBITDA was $128 million, with an adjusted EBITDA margin of 23.3%, 20 basis points ahead of first quarter profitability. Our year-to-date operating cash flow was $145 million, which represents a conversion rate of 56%. Excluding separation costs, operating cash flow was $181 million, or a conversion of 70%. Capital expenditures year to date were $67 million, down $11 million, or 14% from a year ago, as we begin to benefit from lower spend on our cloud transformation. Adjusted EPS for the year-to-date period was $0.25, compared to $0.28, driven by depreciation from the cloud migration. We will benefit from the share repurchases moving forward. Turning to the balance sheet, our quarter-end cash and cash equivalents balance was $183 million, and total debt was $2.8 billion. After quarter end, we used transaction proceeds to repay $740 million of debt. As a result, we reduced our net leverage to 2.8 times, below 3 times as committed, and our remaining debt is 100% fixed for 2024 and 70% fixed for 2025. From a capital return perspective, we have been more active since May with announced share repurchases of $155 million. Today, we have $93 million remaining share buyback authorization, and we will continue to make share repurchases a priority. Next, I'll cover our 2024 outlook, starting with revenue. We expect that our core ARR business, which represents over 90% of total revenue, will improve sequentially through the remainder of 2024. This is the core long-term contract base of our business that is stable and resilient. From a bookings perspective, we expect the momentum will continue. Now turning to our non-recurring project revenue, which represents less than 10% of our total business. Revenue was down 7.8% through the first half of 2024, and we are seeing even less demand today, driven by increasingly cost-conscious customers for this project work and is limiting large-scale projects related to benefit plan rollouts, regulatory changes, and M&A. For the second half, we expect non-recurring project revenues to be down approximately 20%. This project work will return as it has before and with more clients in ARR, so we will have an even larger base to drive project growth in the future. Given this context we outlined and impacts on non-recurring project revenue, we expect second half revenue down 1%-3%, with total year revenue down 2%-3%. Revenue under contract for the second half of 2024 is $1.2 billion, or 97% of our expected 2024 total revenue. For full year 2025, revenue under contract is now $1.7 billion, and for 2026 is $1.3 billion. We expect total year Adjusted EBITDA margin of 25%-26%, which includes the start of run rate savings from the cloud migration. On a quarterly basis, third quarter profitability will likely be lower compared to 2023, given our lower project revenue. In the fourth quarter, we will begin seeing the benefits of the cloud migration and expect stronger profitability versus the prior year. From a cash flow perspective, we expect our operating cash flow conversion in the range of 55%-65%. We believe our revenue model of 4%-6% annual growth is supported by our long-term revenue under contract, historic revenue retention of 95%-99%, continued go-to-market progress that will increase ARR, and our history of growth, as you saw from the supplemental investor deck we shared last month. Also, we reaffirmed our midterm targets related to operating cash flow of 65%-80%, maintaining net leverage below 3x, and finally, an Adjusted EBITDA margin of 28%. W e're not stopping there. We have a value creation program underway with AlixPartners to leverage our technology to drive better quality and experience for our clients and to streamline the company. This is a new chapter for Alight, and we are energized by the opportunity in front of us to continue building the go-to-market momentum and ARR growth. We will be holding an investor day before the end of this year, where we look forward to sharing more detail on our strategic and financial objectives. With that, let's open it up for Q&A. Thank you. Ladies and gentlemen, we will now be conducting a question and answer session. If you would like to ask a question, please press star and one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star and two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Ladies and gentlemen, we will wait for a moment while we poll for questions. Our first question is from the line of Scott Schoenhaus with KeyBanc Capital Markets. Please go ahead. Hi, team. First, Stephan, it was really a pleasure working with you over the last several years. You're really leaving the next CEO a really, really great asset. Thank you, Scott. I guess this is a question for both Stephan and Jeremy. I mean, Jeremy, you gave a lot of color there on the back half guidance, project revenue being down, I think you said 20%. Sure. But you noted that you should see sequential improvement in ARR, and I think you noted about double digits booking growth. That's right. I just want to break down the back half, if you could. Can you provide more color on the revenue dynamics in third quarter versus fourth quarter? Because I think that's important for investors to understand, the moving dynamics between those two quarters. Thanks, Scott. Good morning. n the recurring revenue side, we still have a slight headwind from the COBRA volumes last year, last year. O n a comparable basis, that subsides at the end of the third quarter. T he growth will accelerate through the second half, with higher growth in the fourth quarter. And so, so we would expect the third quarter to be better growth than the second quarter, and then the fourth quarter to be the highest growth for the year, as we continue on. On the project side, we'll. W e'd expect to see almost the inverse, which is the fourth quarter typically carries even more project revenue. And so as we see that impact of the project revenue and more cost consciousness, that'll impact the fourth quarter more. Y ou'll still on an absolute basis, you'll still have a fourth quarter that's larger in revenue sizing. I would say you have more improvement in the fourth quarter on the recurring side from the ARR, and less so, so it's a greater decline in the fourth quarter. Is that helpful? Yeah, that's helpful. And then my next question was on the margins. Clearly a nice acceleration in the second half outlook, given the divestiture. How should we think about the cadence of margin expansion in the back half from third quarter to fourth quarter? W hat are the opportunities you're looking for? You know, what are the opportunities in the nearer and longer term there? Thanks. Sure. Q3 will be slightly lower profitability than we had last year, and that's just driven by some of that project revenue, decline, drops through. F rom a margin perspective, slightly lower than last year. In the fourth quarter, we start to really, that's really when the run rate savings from the cloud migration kick in for a full quarter worth of benefit. W e're expecting. T ypically you would have, I think last year we had a on a 25% margin business, we had over 30% EBITDA margins. We would expect this year in the fourth quarter to be slightly higher than we were last year in the Q4. Y ou do get the typical ramp, and that gets accelerated slightly just given the cloud migration benefits that we have coming through. That'll be again, that starts the run rate of $75 million of annual cost savings that we will get now that the cloud migration is completed. T hat's the next big step for us as we think through the next couple of years. We've got the cloud migration benefits as well as, as I mentioned, AlixPartners has kicked off with us to support us in removing any dyssynergies from the transaction, as well as driving the streamlining across the rest of the company. Thank you very much. Sure. Thanks, Scott. Thank you. Our next question is from the line of Kevin McVeigh with UBS. Please go ahead. Great. Thanks so much. Morning, Kevin. Morning, Kevin. Good morning, and Stefan, best of luck. It's, a pleasure working with you. Thank you If possible, talk to the second half guidance just a little bit because, and maybe I'm thinking about this wrong, but, it was thought typically that the professional services was lower margin, but it seems like if you look at the pacing of the EBITDA relative to the revenue, it looks like the EBITDA is underperforming the revenue in the second half. I guess, is that right, or is there anything else in there that's driving that? And then what's the dollar amount of the cloud migration in the fourth quarter of the $75 million, how much comes in the fourth quarter? I just want to start there. Sure. Thanks, Kevin. I t's about, I would say, $20 million for this year. You start to get some of the benefits in the third quarter on the cloud migration, and then I'd call it we're at run rate in the fourth quarter on that. J ust think about that as call it $18 million-$19 million of benefit in the fourth quarter, as we're at run rate on the cloud migration. On the first part of your question, as it relates to project revenue, I think about it differently. T he professional service, so the divested professional services business, did carry a lower margin on that revenue. T he project revenue that we're talking about now in the second half with the go-forward benefits business can carry a higher margin. That can be upwards of call it, 50% margin because it's our client delivery teams that are working and are already on-site with our clients, driving that project revenue. T hat's what you see there, and that's the impact as we think about the third quarter. Again, that gets more than offset from the cloud migration benefits in the fourth quarter. That's helpful. I t sounds like, Jeremy, that maybe the core business is outperforming on the margin, just given some of the pressure from the professional service. Correct. That's right. That's right. Which is great. T hen the incremental buyback, any sense of timing and pacing on that? J ust maybe I'll end it there. Thanks. Sure, Kevin. O n the $75 million, we executed the accelerated share repurchase program on July fifteenth. That will run through likely the end of August, beginning of September timeframe. T hat's when that $75 million will fully become executed and bought back. T hen, as I said, we've got the $93 million of remaining authorization, so we will look to be opportunistic in terms of that as we move forward through the remainder of the year. Thank you much. Got it. Thanks, Kevin. Thank you. Our next question is from the line of Joseph Vafi with Canaccord Genuity. Please go ahead. Hey, everyone, good morning, and also my best wishes to you, Stephan, on your next chapter as well here. Thank you. Maybe we just start on the ARR commentary. I know you're looking for, you know, some good acceleration in ARR bookings in the second half. Could you just remind us, you know, w hat the compare is looking like in the second half versus a year ago to, you know, get a feel of, you know, is it a tougher or easier compare? T hen if you look at ARR bookings, you know, on a dollar basis, first half, second half, is there some commentary there? Are we up in the second half on dollar volume basis? T hen I'll have a quick follow-up. Sure, sure. Thanks, Joe. Yeah, so, so, I mean, as you remember from in 2023, we did have an acceleration in our bookings. You know, we, we had a slow start in 2023 around bookings. We saw acceleration in the second half. So the compare gets harder in the second half of 2024 for us, but we still see double digits as a, you know, a view from the field and how we look at pipeline and win rates today, where we expect that momentum to continue. Typically, we would have, call it, 60%-65% of, of dollar amount of bookings would happen in the second half of the year, and so it's always a tougher compare in terms of dollars. A gain, it's also the buying season continuing right now, and, and we've got a nice pipeline of deals. You saw the key wins that we've announced. Some really nice momentum in the admin space, in the navigation world, leaves administration. So that's really the drivers for us. So it's a bit of a tougher compare from last year, but, you know, we reorganized this go-to-market structure last year. We've got better coverage now in terms of how we think about strategic and enterprise accounts, how we're going after new logos, and so that's a lot of the driver in terms of just building an overall larger pipeline, higher quality pipeline around ARR, and then our win rates and being able to execute. Yeah, Joe, we're definitely seeing with this cost-conscious environment that our. I t's to our benefit on the ARR side. Y ou look at UPS, moving away from best of breed to more enterprise approach. We're seeing lots of more deals like that in our pipeline, so we're excited about what we see ahead. T he compare is tougher, but the pipeline is larger than we've seen in a while. Great. That's great color. T hen I know you're obviously not, providing 2025 guidance, but just on the project-based business, is there some normalization you see? L ooking out, given where the macro is, given what, the ebb and flow of different projects are, and a historical backdrop to get a feel for, you know, when or, you know, what you'll be looking for for normalization in that business, you know? Not looking for real growth, but just what would be some of the big macro factors that could help us from our seat? Thanks a lot. Sure. Thanks, Joe. A gain, I think the next six months of execution on what we're just talking around the ARR bookings as well as, you know, time to t his project work, I wouldn't say it's as sensitive to macro, but you do see more cost consciousness as we talked about. W e have a project-based business, which once again, is less than 10% of the revenues on our business. We have seen this, flow and go through, the peaks and valleys over periods of time. We wouldn't expect that it continues for an extended period of time, but I think the next few months will give us a better view on pipeline, what we see coming into the early parts of 2025, and I think it'll be important for us, as you saw, we announced the Investor Day later this year, where we can watch, you know, execution on the ARR booking side, as well as see what this environment looks like as we head into 2025. I wouldn't expect this for a very extended period of time. A gain, it's, it is project dependent. M&A activity is a driver for us, in terms of these large projects, as well as the regulatory environment. It's an election year, so coming out of an election year, you would typically see some public policy changes, and you can see some, some pickup in project work. I mean, our go-get is a lot less going into next year and other years. As you know, our revenue under contract and backlog used to be in the 80s, now we're going to be in the 90s, but that doesn't give us a lot of room to drive a lot of in-year revenue, right? T he ARR bookings is going to be a, to your point, a key metric to look at, and we're going to continue to support that data set with what we just gave today. Y ou'll see over the next six months, that that'll help drive a good quality book of business in terms of helping sustain a better, profitable growth orientation for the company. Great, guys. Thank you very much. Thanks, Joe. Our next question is from the line of Tianxin Huang with J.P. Morgan. Please go ahead. Thank you, and yeah, all the best to you, Stephan. You know, I'm just curious, you know, you brought a lot of tech and software experience, you know, to Alight. What do you think, or what can you share with us on what the board is looking for in a successor here and the next step of Alight? Well, listen, yeah, no, I appreciate that comment, Tianxin, and I think it's. As it's in my fifth year, and we've done a lot to modernize and, you know, undo the last 40 years of technology into a better platform to do what? To meet the needs of what our customers are looking for, which is this best-of-breed point solutions environment is not supportive of driving better engagement with their employees, and I've talked about that for years. This cost-conscious environment has even brought it more to the forefront. A gain, you look at the deals I announced, Honda, you look at UPS, you look at Wayfair, you look at Adecco, all of them are coming to us and talking about: We need to simplify, we need to consolidate, we need to take cost out. Now with this divestiture of the business, Tianxin, you know, 8,700 people out of the company into a new business. We got rid of the payroll pro serve, capital intensive, labor intensive. G etting back to the core of benefits administration and getting back to the, the service delivery elements of what that core business is, that's a great combination that we're excited about how the platform, together with strong service delivery, really gives us an advantage on the enterprise side. T hat's why the pipeline is where, is where we see it in the second half and beyond. That's why we're committing, you know, publicly on paper to say that we're gonna drive double digits booking into the second half. R eally excited about where the company is today. Got it. My follow-up. Thanks for that. My follow-up, just on the, I know a lot of questions been asked and answered on the non-recurring side. Just big picture, is this just a cyclical issue, or are there some structural issues as well? As we think about things like benefit changes, I'm curious if automation or, you know, some of these AI tools that are coming out, is that playing a role in some of the effort change? I'm just trying to understand a little bit better. Thank you. Yeah. Do you want to jump in? Yeah. Go ahead. Why don't you guys sit closer, though? This is Greg. I don't see anything structural with that. I view it as much more cyclical. If you think about some of the macro factors that Jeremy said, you know, plan design changes, sometimes that's higher in certain years than other years. Regulatory environment, the M&A environment, those are really what drive it, not a macro technology trend. Certainly, in the large and enterprise markets, are still driven by the same factors that they have been for quite a long time. I don't see anything structural there. Yeah, I mean I'll probably give you a great example. W e're in an election year, benefits changes aren't as much this year, so the core part of our business around this upcoming annual enrollment is super strong, and the bookings and the deals we're getting are, are amazing wins that we've had. W hen you get to annual enrollment, to your point on what's, what's different, is that small 8% book of business, which is the project stuff. As d uring annual enrollment, a lot of clients wanna do communications to their employees on what are the benefits changes, what are some of the new things they should be excited about? We make $ millions in comms, in the communications category. That's exactly what that is. W hether that comes or goes, there's peaks and valleys to that book of business. This year, pre-election, is a lighter year in that comms business. You know, with if M&A comes back next year with the new government, you know, dynamics, potentially with new, rules and regulations. There'll be new plan changes going into the beginning of the year. That drives increased communications requirements. So that's that project part of our business, when you talk about structure versus, you know, what's different. So it ebbs and flows, and that's why you're seeing us be so aggressive on the more ARR focus, which really, you know, transcends these, you know, short-term trends. That's right. ARR growth is what drives that project business. And feeds it anyways. Feeds, feeds the project business. Thank you. Thanks, Chenxin. Thanks, Chenxin. Our next question is from the line of Peter Christiansen with Citi. Please go ahead. Good morning. Thanks for the question. Best of luck to Stephan. I'm just curious, in terms of the renewal season that upon us, how are you thinking about the degree of contracts that are up for renewal versus this year on Hey, Peter. Y ou're really breaking up, Peter. We can't hear you very well. Sorry. Sorry. Is that better? There we go. Oh, there we go. Much better. Yeah. All right. Apologies. Apologies. Well, thanks again for the question. Best of luck, Stephan. Thank you, Pete. I'm just curious, as it relates to the upcoming renewal season, how are you seeing the degree or the amount of contracts that are up for renewal in the back half of this year, I guess, versus last year? A ny sense on how the renewal season is shaping up or, you know, early sense there? I have a follow-up. Thanks, Peter. It's a pretty standard set every year in terms of how much is up for renewal. If you just think about our 3- 5-year long-term contracts, I think, yeah, our teams are very focused on retention, right? The value that we can drive, you know, to some extent, reorienting ourselves on the service. You know, Greg Goff is here with us. I mean, spending time with our clients from a delivery perspective and, and an ability to, you know, once again differentiate ourselves. We're, we're the leader in this space. We've got a long, you know, long-term relationships, average tenure over 15 years. I wouldn't say the dynamics are any different this year going in and, and how we think about 2024 and 2025 and into the midterm. Very focused on how we differentiate ourselves with our clients. We're very close, every day with them. As you can see, we've got between 95% and 99% retention levels that we expect to maintain as we go through the long term here for the company. Yeah. A s I said on the macro side earlier, this environment helps us on that high-value ARR business, right? Companies are looking to us to help them consolidate and simplify and drive more of an enterprise approach. T hat plays to us, 'cause we're the only ones who can really provide a true benefits and navigation and leaves integration, capability. That's helpful. Then I'm just looking at slide nine and the volume comparison in the growth model here, obviously impacted by changes in COBRA, likely the bulk of the attribution for this year's performance. But I guess as you think about going forward, notwithstanding what's going on in the employment environment, just generally, how are you thinking about pricing as a potential uplift as you think about 2025? Sure. So as we rolled out the new pricing model about a year ago, and that has particular SKUs in it, which have annual increases, which is an offset to some extent to how our typical contracts work in terms of inflation, you know, ECI protections. And so I think we think about price as an opportunity with the new technology and some of the SKUs, as we roll out and go through the renewal cycle and additional products and service and solutions for our customers. I don't think about it as a large driver, either up or down, frankly, from a price perspective, as we go through the renewal cycle. Y ou're right. Yeah, sure. I was just going to say y ou're right, on the, on the COBRA side, on volumes, that's just a comparable to last year, and that just i 's a fixed headwind that goes away here in September. That's good to hear. Last one from me. Just curious if you have any sense of any decision delay or go live delays or any chatter on that. I know it's been an issue in previous quarters here and there, maybe in terms of the bookings, but, given the volatility in the environment these days, just curious if there's been any sense of decision delay creeping in. Yeah, I'll let Greg answer that since he runs delivery. T o your second part of your point, the previous delivery delays were in our Workday implementation business, which no longer sits with the Alight business today. T hose were the previous delays. Yeah, that's right. That's exactly the way to think about it, from an implementation and ongoing delivery perspective, we don't see anything changing there. It's very much on course, and that's partially driven by the benefit side of the business, has very specific timing, that implementations need to happen in order to hit renewal annual enrollment cycles, in order to hit contract ends. You saw that dynamic much more, as Stephan said, on the Workday professional services side and the payroll business that tended to be much more subject to implementation delays. That's super helpful. Thank you all. Best of luck, Stephan. Yeah, thank you. Appreciate that. Thanks, Peter. Our next question is from the line of Heather Balsky with Bank of America. Please go ahead. Hi, this is Emily Marzin for Heather Balsky. Thank you for taking the question. I think I'm going ask one of the earlier questions a little bit differently. With the double-digit ARR expected in the second half, which and an improvement from where we are today. What are you seeing that you can achieve that target, especially with the slower growth this year? Is it from new products, new customers, upsell, that target of the mid-market? If you could give us some color there. Sure. I mean, I think I'll start and maybe Stephen can. I think, Emily, it's pipeline, right? It just. I go back to realigning our go-to-market team last year. I t does take some time to get, you know, better coverage of the market, both with how we expand our... with our current relationships we have, but also driving new logo wins. And so it takes time to build that pipeline, mature that pipeline, and as you build a higher quality ARR pipeline, to have higher win rates and execute on it. That was a big driver now in terms of, as we do a bottoms-up build in terms of the forecasting, it's really looking at the pipeline that we've got today, the stages of the deals within the pipeline, and working with our teams in terms of win rates and execution moving forward. I t really starts in the bottoms-up, you know, basis of what the funnel is and the pipeline going forward. A gain, the new products, absolutely, as you think about expansions of current relationships, if I've got long-tenured benefits administration clients, we now have the newer products and solutions over the last couple of years: navigation, leaves administration, retiree. We've got a number of newer products over the last couple of years, as you think through either going through a renewal cycle or even outside of the renewal cycle, to just build pipeline. I really want to give a hats off to Greg George, our new leader we brought in last year, who heads up our commercial business, and he has brought in a great new team. Our net new expansion has really helped us with some great new wins. Sarah, who works for him, is also new in the last year, and has just driven an incredible amount of capability in our install base. As I said earlier, the macro environments that we're seeing help us in this environment because a lot of clients are looking to cut cost. The value engineering capability we've built up the last four years, really helping customers understand the roadmap of how to consolidate service delivery capabilities across a lot of point solutions into a more enterprise approach, takes us to a new outcomes-based approach that is unique to us. And I think we're now, Greg, what? On our sixth release of Worklife, where we continue to deliver integrations and capability and functionality that allows people to make better decisions. It allows to drive higher engagement. We put a whole bunch of new functionality into our products that allow to really build a personalized experience to each individual, which is hard. As you know, we serve some of the largest clients with millions and millions of employees, and trying to build an individualized experience in the category of benefits is really hard to do. We've cracked the code on that, and I think that's really gonna help us continue to drive momentum in helping clients do better with less. Thank you. T urning to project revenue, have you seen any project delays or being cancelled? W hat gives you the confidence that the business is going to come back? This project work is, you know, pipeline driven, as the team said earlier, Emily. As you build your ARR base, it drives this work that goes through. Again, if M&A is lower, you know, as it rebounds, we do, you know, a lot of work around acquisitions and divestitures. Regulatory changes impacts almost every one of our large enterprise clients, so that project work comes back. T here's a lot of history around this business in terms of what drives and how we sit as partners in communications for large benefit plan changes that exist in this space. T hat has not gone away over the long term as we look at this business. The project work, we really look from a pipeline perspective of what's in the near term as we go through. I think we'll look forward to updating, more as we go through and think through Investor Day, towards the end of this year, of what the outlook is for 2025. The project business is a derivative of the ARR business, so let's not forget that. The continued focus for us to get to this higher quality, net new wins, expanding the footprint of our products into our clients, all lead to further downstream project business. I want to make sure that's a clear point we want to make. Thank you. Thank you. You're welcome. Thanks, Emily. Our next question comes from the line of Steven Warhaftig with Wedbush Securities. Please go ahead. Hi, guys. This is Steven Warhaftig, on for Dan Ives. It's great to hear from you guys. Stephan, best of luck, and it was a pleasure working with you over the past couple of years. Thank you. I wanted to talk a little bit about the cadence of this annual run rate cost savings that you guys are seeing from this cloud migration. Can you just clarify a little bit on what the factors are driving both the growth margin and the EBITDA over the next 12- 18 months? I s this $75 million of cost savings going to be realized, on a sequential basis, more straight lined, or are you expecting more fluctuations with these? Sure. Thanks, Steven. T hink about $20 million of the $75 million annual run rate starts this year. Wi ll get some savings that come into the back end of the third quarter, and then effectively at full run rate into the fourth quarter. T hat'll drive $75 million of annual run rate savings next year. C all it $55 million incremental in 2025 as a benefit. W hat it really does, importantly, is you look. If you think about how we laid out the cadence, you know, 28% in the midterm as an EBITDA margin, the drivers of that, now that the cloud migration's completed, is our ability to standardize the operating model and how we deliver for clients. The history is a bit more customized, right, on, for specific clients. This, because of the standard back-end infrastructure, the standardized technology, allows Greg and his teams now to build process COEs to deliver for our clients. L everage the technology, you can drive better quality of service for our clients, and we'll continue to also leverage the technology within our customer care centers. As we talked about last year, going through annual enrollment, we brought down call volumes, you know, 10%-20%. We expect to continue that again, once again, with the right levels of technology and AI to drive a better service quality there. T hose are the big drivers as we think about out to 28%. I want to make sure, the cloud migration is really the pivot point for that. T hat was a huge element for us to successfully migrate all of our clients, all of our applications into the cloud now that allows a lot of this work to move forward. Great. Thank you. Thank you. Ladies and gentlemen, this concludes our question and answer session. I would now hand the conference over to Stephan Scholl for closing comments. Great. Thanks. I appreciate everybody joining me and Jeremy and the team here this morning. Great questions, good discussion, good dialogue, and look forward to seeing all of you out there. Thanks very much, and have a great day. Thank you. The Alight conference has now concluded. Thank you for your participation. You may now disconnect your lines.