Thank you for standing by. My name is Meg, and I will be your conference operator today. At this time, I would like to welcome everyone to the AMETEK Inc. Second Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I would now like to turn the conference over to Mr. Kevin Coleman, Vice President of Investor Relations and Treasurer. Please go ahead. Thank you, Meg. Good morning, and thank you for joining us for AMETEK's second quarter 2024 earnings conference call. With me today are Dave Zapico, Chairman and Chief Executive Officer, and Dalip Puri, Executive Vice President and Chief Financial Officer. During the course of today's call, we will be making forward-looking statements, which are subject to change based on various risk factors and uncertainties that may cause actual results to differ significantly from expectations. A detailed discussion of the risk and uncertainties that may affect our future results is contained in AMETEK's filings with the SEC. AMETEK disclaims any intention or obligation to update or revise any forward-looking statements. Any references made on this call to 2023 or 2024 results, or 2024 guidance will be on an adjusted basis, excluding after-tax, acquisition-related intangible amortization, and excluding a pre-tax $29.2 million or $0.10 diluted share charge in the first quarter for integration cost related to the Paragon Medical acquisition. Reconciliations between GAAP and adjusted measures can be found in our press release and on the investor section of our website. We'll begin today's call with prepared remarks, and then we'll open it up for questions. I'll now turn the meeting over to Dave. Thank you, Kevin, and good morning, everyone. AMETEK delivered solid results with strong operating performance in the second quarter against the backdrop of a more subdued global growth environment. In the quarter, we experienced continued headwinds from inventory destocking across our OEM customer base, leading to lower than expected sales volumes. Additionally, we are seeing signs of customers turning more cautious, leading to some temporary delays in project spending. Despite these headwinds, our businesses delivered strong operating performance in the quarter, with solid growth in cash flow and earnings and robust core margin expansion, reflecting the strength and flexibility of the AMETEK operating model. We expect the inventory destocking, and more cautious customer behavior to continue in the back half of the year. As a result, we are adjusting our outlook for the remainder of the year. We remain confident in our ability to successfully navigate these near-term headwinds. As we've done in the past, we will expand our focus on operational efficiencies, continue to invest back on our businesses, utilize our strong balance sheet to deploy capital on strategic acquisitions, and ensure we position AMETEK for continued long-term growth. Now, let me turn to our second quarter financial results. Sales in the quarter, sales in the second quarter were $1.73 billion, up 5% from the same period in 2023. Organic sales were down 2%. Acquisitions added 8 points in the quarter, and foreign currency was a slight headwind. AMETEK's operational performance in the quarter was excellent, with robust margin expansion. Operating income in the quarter was a record $448 million, a 7% increase over the second quarter of 2023. Operating margins were 25.8% in the quarter, up 40 basis points from the prior year. Excluding the dilutive impact from acquisitions, core margins were up a sizable 180 basis points in the quarter. EBITDA in the quarter was a record $545 million, up 10% over the prior year, with EBITDA margins an impressive 31.4%. Cash flow in the quarter was excellent, reflecting our operating capability and asset-light business model. Operating cash flow in the quarter was up 14% to $381 million, with free cash flow up 17% and free cash flow conversion of 107%. This operating performance led to earnings of $1.66 per diluted share, up 6% versus the second quarter of 2023, and above our guidance range of $1.63-$1.65 per share. Now, let me provide some additional details at the operating group level. First, the Electronic Instruments Group. EIG delivered strong operating performance with outstanding margin expansion. EIG sales were $1.15 billion, a 2% increase from the second quarter of last year. Organic sales were flat, and acquisitions contributed two points. Growth was strongest within our Aerospace and Defense and CAMECA businesses in the quarter. EIG operating income was $350 million, up 14% versus the prior year, and operating margins were at 30.3%, up 320 basis points from the prior year. Our EIG businesses are operating at a very high level with excellent operating margins. They remain well-positioned to benefit from a number of important long-term secular growth drivers,... given their increasing exposures to attractive markets across process, aerospace, power, and energy markets. The Electromechanical Group continues to navigate the impacts of the inventory normalization across our Automation and Engineered Solutions businesses. In the quarter, EMG sales were a record $581 million, a 14% increase compared to the prior year, driven by contributions from the acquisition of Paragon Medical. Organic sales declined 6% due to weakness in our Automation and Engineered Solutions businesses, more than offsetting solid growth across our EMG, aerospace, and defense businesses. Acquisitions contributed 20% in the quarter. Operating income for the second quarter was $123 million, with operating margins at 21.2%, while core operating income margins were 25%. As we have noted for a number of quarters, OEM customers across a wide range of markets are reducing excess inventory built up during the supply chain crisis. While we had expected to see conditions improve in the second half of the year, we now believe demand within this OEM customer base will remain subdued at current levels through the end of 2024. This inventory normalization is also impacting our medical OEM businesses, including Paragon Medical, leading to near-term delays in orders and shipments. Paragon remains very well positioned for strong growth once the inventory correction is complete, given their leadership position across a number of high-growth MedTech market segments. Additionally, Paragon has won a number of new programs that we're currently investing in, which will drive incremental growth in 2025 and beyond. As we noted last quarter, we are leveraging our proven integration capabilities to drive meaningful operational improvements to best position Paragon for long-term success. As the volumes return following destocking, we believe the business will be levered to deliver outstanding sales growth and profitability. In summary, we are operating our businesses very well, with 7% growth in operating income and 180 basis points of core margin expansion in the quarter. We continue to generate strong cash flow, with 17% free cash flow growth in the quarter, and for the full year, we expect free cash flow to net income conversion to be between 110% and 120%. The strength of AMETEK's operational excellence strategy is evident in our operating results. We continue to drive efficiency improvements across our businesses by leveraging our global infrastructure and OpEx initiatives. This year, we now expect to generate $140 million in savings. We also remain committed to investing back into our businesses, and this year, we expect to invest an incremental $90 million in growth, largely focused on research, development, and engineering, and sales and marketing. The effectiveness of these investments is reflected in our Vitality Index, which was a strong 24% in the quarter. Additionally, our strong Free Cash Flow and flexible balance sheet provides us with ample financial capacity for strategic acquisitions. Our pipeline of acquisition opportunities remains strong. AMETEK is very well positioned to continue to expand our portfolio of highly differentiated businesses that both our organic growth investments and our, and our acquisition strategy. Now, turning to our outlook for the remainder of the year. With destocking expected to continue through the balance of the year, and some customers turning more cautious on project spending, we are adjusting our sales and earnings guidance for the full year. Overall, sales are now expected to be up 5%-7% versus the prior year, with organic sales expected to be flat to down low single digits. Diluted earnings per share for the year are now expected to be in the range of $6.70-$6.80, up 5%-7% compared to last year's results. This is less than a 1% reduction from our prior earnings guidance range of $6.74-$6.86, as our proactive productivity actions, along with a lower expected fourth quarter tax rate, help offset the impact of the reduced sales forecast. This guidance reflects second half sales and operating earnings, essentially in line with our first half results. For the third quarter, we anticipate overall sales to be up mid-single digits, with earnings in the range of $1.60-$1.62 per share, down 1%-2% versus the prior year. In summary, we are pleased with our business' strong operating performance in the second quarter. We have a proven operating model and an experienced management team, and we remain confident in our ability to navigate the sluggish demand environment and deliver exceptional long-term results. I will now turn it over to Dalip Puri, who will cover some of the financial details of the quarter. Then, we will be glad to take your questions. Dalip? Thank you, Dave, and good morning, everyone. As Dave noted, AMETEK had a solid second quarter, with excellent operating performance, leading to outstanding margin expansion and strong cash flows. Now, let me provide some additional financial highlights for the second quarter. Second quarter general and administrative expenses were $25 million, or 1.5% of sales, in line with last year's second quarter. For fiscal year 2024, general and administrative expenses are expected to be approximately 1.5% of sales. Second quarter interest expense was $31 million, up $12 million from the second quarter of 2023, due to higher debt balances following the acquisition of Paragon Medical in December. Second quarter other expense was down approximately $4 million versus the prior period, due largely to higher pension income and higher investment income in the quarter. The effective tax rate was 19%, up from 18.2% in the second quarter of 2023. For 2024, we now expect our effective tax rate to be between 17%-18%, driven by a lower fourth quarter tax rate due to statute expirations. As we have stated in the past, actual quarterly tax rates can differ dramatically, either positively or negatively, from the full year estimated rate. Capital expenditures in the second quarter were $21 million, and we expect capital expenditures to be approximately $150 million for the full year, or about 2% of sales. Depreciation and amortization expense in the quarter was $99 million. In 2024, we expect depreciation and amortization to be approximately $400 million. This includes after-tax, acquisition-related intangible amortization of approximately $190 million, or $0.82 per diluted share. Operating working capital in the second quarter was 18.6% of sales. Operating cash flow was $381 million, up 14% versus the second quarter of 2023, while free cash flow was $360 million, up 17% over the prior year. For the quarter, free cash flow conversion was a strong 107% of net income. For the full year, we continue to expect strong free cash flow conversion in the range of 110%-120% of net income. Total debt at June 30 was $2.65 billion, down from $3.3 billion at the end of 2023. Offsetting this debt is cash and cash equivalents of $397 million. At the end of the second quarter, our gross debt to EBITDA ratio was 1.2x, and our net debt to EBITDA ratio was 1x. We have significant financial capacity and flexibility, with $2.2 billion of cash and available credit facilities to support our growth, growth initiatives and to deploy on strategic acquisitions. In summary, AMETEK had a solid second quarter of 2024, delivering strong results with robust margin expansion and excellent free cash flows. Our leading positions across attractive market segments, combined with our strong balance sheet and outstanding operating capabilities, leaves us very well positioned to navigate the current environment and to deliver on our growth strategies. Kevin? Great. Thank you, Dalip. Meg, could we please open the lines for questions? Thank you. The floor is now open for questions. If you have dialed in and would like to ask a question, please press star one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star one again. If you are called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Your first question comes from the line of Matt Somerville with D.A. Davidson. Please go ahead. Thanks. Morning. A couple questions. First, Dave, you know, you seemed pretty convinced a quarter ago that the destocking phenomenon would sort of wrap itself up by, by midyear. So I, I guess, relative to 90 days ago, can you maybe talk a little bit about what's, what's changed? What gives you confidence that we're only in for another six months of this? And then maybe touch on what end markets and businesses are starting to be impacted by some of the project delays you referenced, and then I have a follow-up. Thank you. Yeah, our outlook for the year has changed, and as we noted in my prepared remarks, we now expect the improvements in the second half of the year are not gonna happen as originally anticipated, and we talked about that earlier in the year. We now expect our sales and operating performance in the second half will be similar to the growth that we, the sales and operating performance in the first half. So we're not gonna see the increases that we had anticipated. And this change results in about a 4-point reduction in our sales outlook. And you know, to your question, where is it coming from? Roughly 3 points of this reduction is from our automation and engineering solutions subset, which is the businesses that we talked about being exposed to the OEM destocking. And within that area, we have 2 points of the reduction tied to our automation business and 1 point from the Paragon destock. So that makes up about the 3-4 point reduction in our outlook. Across our EIG businesses, we expect about 1 point of lower sales due to short-term project delays. And there we're seeing customers are being just a bit more cautious, given the cumulative impact of a wide range of economic, political and geopolitical factors. And, but we feel these are temporary delays. Our new funnel pipelines remain very solid. Projects are not being canceled, they're being delayed. And given the expected lower sales, we reduced our earnings guidance by about a nickel at the midpoint. You know, and another couple of points, I mean, we're really doing a good job running the company. When you take that sales decrease, it reflects about a 20% incremental margin on the expected lower sales. And as Dalip mentioned, the tax rate will be lower in Q4. So, you know, I'm pleased with how the team is managing through these temporary demand changes. You know, I'm confident that we're positioned to see accelerated profit growth when the economic conditions change. I think, you know, to your point, we missed the timing of the recovery, and the inventory corrections will take a bit longer. And as AMETEK does, we're adapting to the current situation, and we're going to manage our businesses appropriately. As I said, we got really pleased how the team responded with, you know, a 20% incrementals to the volume change. No, thanks, David. I would definitely agree on the decremental comment. Can you also, I think it's probably good from a timing standpoint in the call, can you kind of go ahead and do the around the horn you typically do across the businesses, and how expectations have kind of changed in some of the sub- verticals? Yeah. Sure, Matt. I'll start with our largest subsegment, the process. Sales for our process businesses were up low single digits, with solid growth across our energy businesses and our CAMECA business in the quarter. As noted in my prepared remarks, we've seen customers, as we just talked about, turn more cautious. We expect this to continue as the second half, as we discussed, and we expect our process businesses to be flat to up low single digits versus the prior year. Now I'll move to aerospace and defense, and that business was up mid single digits in the quarter. Growth was strongest across our commercial aerospace businesses, while defense experienced some shipment delays in the quarter. Now, for the full year, we continue to expect strong, high single-digit organic sales growth for our A&D business, with similar growth across both our commercial and defense businesses. Next, I'll move to our Power and Industrial businesses. Overall sales for our Power and Industrial businesses were up mid-single digits in the second quarter, with contributions from recent acquisitions being offset by a low single-digit decrease in organic sales. Similar to our process businesses, our Power and Industrial are seeing the same kind of customers delaying some projects due to the broader macro uncertainties. For all of 2024, we now expect organic sales for our process and industrial businesses to be flat compared to 2023. Then finally, our final segment, automation and engineering solutions. Subsegment sales, they were up high teens on a percentage basis in the quarter. This was driven by the contributions from the acquisition of Paragon Medical. Organic sales in the quarter were down approximately 10% due to the continued normalization of inventory levels across our OEM customer base. We expected to see improvements in return to growth, as we talked about in the second half of the year. As we just mentioned, that's not gonna happen. Inventory normalization is gonna continue through the end of the year. As a result, we expect organic sales for our automation and engineering solution businesses to be down mid-single digits for the full year. That's a picture around the horn, Matt. Great. Thank you, David. Thank you, Matt. Again, if you would like to ask a question, press star one on your telephone keypad. Your next question comes from the line of Deane Dray with RBC Capital Markets. Please go ahead. Thank you. Good morning, everyone. Good morning, Deane. Hey, Dave, I'd like to pick up where you left off with Matt. And just some more color on the customers kind of sentiment here and the delays in project spending. What kind of reasons are they giving you? Is it macro? Are they having trouble getting financing? Is it election worries? Any kind of way that you could characterize and frame for us about this degree of cautiousness? Yeah, I think what we see from our customer base is just, they're just taking longer to approve projects, and they're going further up the sign-off chain to get sign-offs. These are typically, you know, they're not even large projects, and you see those resulting in delays. And I think it's a combination of the elections in the U.S., you know, I think two-thirds of the world has elections this year. So it's elections around the world. It's the, you know, some financing related to the higher interest rate, higher inflation. I mean, it's the wars. It's just a lot of things that they're, you know, combining to affect people's decisions, and they're just delaying a bit. I mean, the thing that is different than some other downturns is we still have very strong pipelines of new activity. So, I, you know, thinking about past downturns, we've been through a bunch of these. I don't think there's been any where we have the strong new activity pipeline from our customers. So the projects aren't being canceled. You know, they're, you know, there may be some delays in phasing some new products in. You know, maybe it's taking longer to get the financing, although that's not the primary feedback we're getting. But I think it's this broader macro issue that's honestly a bit of a smaller issue for us. The bigger issue is the OEM destock. So I think we had the pandemic and then we had the supply chain crisis, and you know, we're selling in our automation and engineered solutions businesses, you know, differentiated components and subsystems to people that are typically, you know, smaller dollar value amounts to the entire system. And when you know, people bought inventory because we're very specialized, and they wanted to keep shipping their products, and now we're just dealing with a destocking process that's just taking a little longer than we thought. And I think that's- Yeah. That, Dave, that's really helpful. I, I love the way you characterized it, because in slowing, that's one of the first things you see customers do, is they kind of delay the spending, more approvals, and so that's pretty familiar. Do you have any sense that it's snowballing from here? Does it get... Like, as the quarter progressed, did those type of behaviors increase? And any kind of monthly cadence would be helpful. Yeah, I think the monthly cadence in both sales and orders was our typical monthly cadence. So otherwise, we typically stair step through a quarter, with the first month being the lowest and the second month being a little bit higher, then the third month being the highest month of the quarter. That same process occurred, but definitely as the quarter went on, we saw some incremental weakness, mainly in the project area. Got it. All right, just last question on the destocking, and when we look back on this period, that's been the biggest surprise, and how long it has persisted. And you're not, by far, the only one. We've seen this everywhere. Anyone who has anything to do with medical or life sciences supply chain, it has just taken more than two X longer than anyone thought. And just the question is, for Paragon, how are - what's their visibility like? You said they, you know, a percent of point was from their destock. Right. What's their visibility, you know, versus your comparison of the rest of the AMETEK businesses? Yeah. Where do they fit on that scale? Yeah, because, you know, Paragon's, you know, mainly in one end market, and they're talking to their customers daily, I think there's a better visibility. And you can also, you know, talk to customers and get market information. So this destocking that we're seeing is really happening everywhere. Just to refresh everybody's memory, as Paragon manufactures single-use and consumable surgical instruments and implantable devices, orthopedic implantable devices, drug delivery systems, they're really attractive markets. At the same time this is going on, we're working on substantial efficiency improvements in the businesses. We talked about that last quarter, and this process is proceeding very well. So this combination of the market growth that follows the destock, along with the new program wins and a leaned out and efficient cost structure, is really gonna provide substantial sales and profit growth for Paragon in the years ahead. You know, we have a similar business and similar markets in another part of AMETEK, and it's seeing the same kind of destock. And Paragon won a tremendous amount of new programs, so we're still investing and driving those things to the market. So I think when you take a step back, this is gonna be a tremendous generator for our long-term shareholders, and we're very optimistic about the business. It's unfortunate about the destock Process, but we're in this game for the long run, and we're doing all the right things for the business. And we've got a new management team with some really talented people from AMETEK that are working with people that are from Paragon, and they have a great plan to take the business forward. So, we're really optimistic about how that business is gonna perform for us long term. Dave, thanks for all that color. Really helpful. Yeah. Thank you, Dean. Again, if you would like to ask a question, press star on your telephone keypad. Your next question comes from the line of Jamie Cook with Truist Securities. Please go ahead. Hi, good morning. Good morning, Jamie. Nice quarter. Nice quarter, considering the environment. Thank you. I guess, just my first question, can you talk to sort of what price cost was in the quarter by segment and what your expectation is, you know, in an environment where organic growth is gonna be flat to down single digit? And then my follow-up question, you know, what also struck me about the quarter, or you know, over the past couple of quarters, is the margins in EIG, you know, above 30%, you know, with, with, with, you know, mediocre growth. So is there anything—like, was there anything unusual to drive the operating margins there? What's structural? What's the risk that, you know, some of this goes away if pricing gets more difficult? I'm just trying to understand the performance in EIG margins, the good performance, you know, given a tough macro. Thank you. Right. Good, good questions, Jamie, and try to answer them both. The first thing is you talked about pricing in the quarter, and our pricing in Q2 was about 3.5 points price, and our inflation was about 2.5 points. So we had a positive benefit from that. So, you know, the pricing environment's moderating a bit, and the inflation's moderating a bit. But we're pleased with that, and it was across our portfolio and, you know, a little maybe a little bit more in EIG, just a bit than EMG, but it was pretty much across the portfolio, a pretty consistent performance. And that's, you know, driven by our differentiated portfolio on the heavy level of investments. We're putting in new products. We talked about a Vitality Index of 24%. We got newer products, fresh products in the market. Our customers are buying them, and that's resulting in some good pricing. And as I said, inflation is moderating. And we think that general environment, the moderation of inflation, our ability to continue to leverage our investments are gonna continue throughout the year. So, you know, no change there, you know, very consistent and so kind of, you know, the AMETEK portfolio is very differentiated and kind of perform very well. In terms of the margins in EIG, if you think about, we've had a similar performance in the first quarter, and an excellent operating quarter. You know, we had 320 basis points up, driven by high leverage, excellent price cost, strongly performing acquisitions, and a really good product mix. And that was consistent from Q2 to Q3, and we see that continuing for the rest of the year. I mean, we do have a comp in Q3 margins is a difficult one because that was a high margin quarter for us, if you look back the past few years. But in general, you think about EIG, the margins are good, and they're gonna stay there, and that business is very well positioned. And you know, it you know, it's a... In our process, in our Power and Industrial, in our aerospace businesses, we've got excellent market positions. And, you know, just talking about the EMG part of the business, they had Core Margins of over 25%, so they got some dilution there because of the acquisition and destocking and automation in medical, in our medical businesses. But, you know, when we look at our businesses, they're running, both segments are running very well, generating excellent margins. I think EIG has historically a bit of a higher margin entitlement because they sell mainly to end users, and they get the aftermarket revenue stream. And, I see, I see that continuing. I'm not, I'm not really concerned that those margins are gonna fall off or anything like that. So, does that answer your question, Jamie? Yes, very helpful. Thank you so much. Thank you. Your next question comes from the line of Jeff Sprague with Vertical Research. Please go ahead. Hey, thank you. Good morning, everyone. Good morning, Jeff. Morning. Hope it's going well, Dave. Hey, just on Paragon, I want to just make sure I have things dialed right here. I think your comment about a point of headwind, right, is on a total AMETEK basis. Yeah. So I guess that implies $40 million or $50 million. So we're sort of talking about the business being down, you know, kind of 8%, 9%, 10% for the year. Is that basically where we're at? Yeah, I'd say you're between 10% and 15%. Okay ... is the Paragon. You're right on. Okay. And then, you know, just thinking about EMG, right? I mean, the comps are getting fairly easy on a year-over-year basis, but really the commentary is, we should kind of think sequentially, revenues are quite similar to Q2, or do you actually see a little bit of step up there? No, that's a good question, Jeff. And when we step back and look at this, first, I'll go to orders. Our orders for the past couple of quarters have had small sequential improvements. So like if you go back to Q4 of last year, you have Q1 of this year, and now the quarter recently completed, the orders sequentially were, you know, up low single digits each quarter. So I feel like the orders have stabilized. We had a minus ten organic in Q1. The orders in Q2, organically, were minus four. And we think in the second half of the year, we're gonna have, you know, a modest improvement versus the first half. So it kind of feels like the business has really stabilized. When you go to sales, you know, we wanted to de-risk the year because it's really flat. So even though you have a little bit of movement from quarter to quarter, if you and we have a benefit of a tax rate in Q4, if you back that out and you look at sales in the first half of the year versus sales in the second half of the year, then you look at operating profit above the tax line in the first half of the year versus operating profit in the second half of the year, it's a 50/50 split. Okay. AMETEK, traditionally, is a 48/52 split. And that's why we think we really de-risked the year with that 50/50 split in the second half. Now, we still have some seasonality in our business. We're, you know, historically Q4, because of the seasonality, is always higher than Q3, and we have a typical seasonality there. And we again, as Dalip mentioned, we have the benefit of the tax rate in Q4, but we really feel we de-risked the year to reflect the current environment, and we think it's gonna stay that way through the balance of the year. And then maybe we could just touch on that tax rate. So, assuming 19% again in Q3 would imply, I don't know, 14% or 15% in Q4. But the bigger question is, just jumping off into 2025, do we stay at that 17%-18% range, or do we move back up into the 19%-20% range in 2025? Yeah, no, you see it right. We move back up in 2025 to our typical tax rate. We haven't done our planning for 2025, but based on where we're sitting, that's what we would expect. Great. Thank you. Your next question comes from the line of Scott Graham with Seaport Research. Please go ahead. Yeah. Hi, good morning. Thanks for taking my question. Hello, Scott. Good to hear from you. Likewise. So I, I wanna understand, so the reduction in sales guidance for the year, you indicated that it was essentially 3 points on it in EMG, 1 point in EIG, and you talked about project delays there. My question is: in your, you know, sort of round the horn, you indicated project delays in power, and I was just wondering if there's any vulnerability to project delays spreading into process, 'cause you didn't cite anything there. Yeah, if I didn't cite it, I should have cited it. Process and power are seeing similar activities. I mean, in the power segment, we have some power test and measurement businesses, and those sell to multiple markets, including the government customers. And there's a little delay there in projects, but we're very well positioned, and you know, those are just delayed. And you know, process is a bit larger, and it's more, you know, but it's kind of the same thing, but that was only 1% of the change in sales, you know, from all of EIG, which is both process and power. Okay. Thank you. Yeah. I wanna maybe shift to defense because that's a pretty high-margin business for you guys. Is that sort of shipment, you know, sort of push out of shipments, is that something that you'll see in the third quarter or the fourth quarter? Is there anything more to discuss there? No, I think that on the defense side, for our A&D business, we kept the guide for the year the same, so plus high single digits. So what we saw in the second quarter was a very good commercial, and, you know, had some defense delays. But for the full year, we're saying that defense and commercial is still gonna be the same. They're gonna be up high single digits. So, they're doing very well there. As you said, there's good margins in our A&D segment, and we feel confident in that segment. Thank you. If I could just squeeze this last one in, Dave. Sure. The net leverage of 1x, it's pretty low for you guys. Just kind of wondering, the pump, I assume, is pretty darn primed at this point. Oh, yeah. How does the pipeline look? Are you, you know, how are the sizes of the deals out there? Maybe you can give us a little color. Yeah, it's the pipeline looks really good. The size of the deals are throughout the whole spectrum. I mean, there are smaller deals, midsize and larger deals. And as we talked about before, we'll probably buy a big business. Big for us is, you know, you know, deployment of greater than $1 billion in capital every couple of years, and that's just because we're generating so much cash flow. I think we really have the opportunity to differentiate our performance in this period. What you really see is there's a lot of PE-owned sponsor businesses that are long in the tooth. They're late in their ownership cycle, and they're struggling now because they have to go back and refinance their businesses at higher rates, and they're also trying to sell the business in a slowing environment. But those are... We have discussions going on, and there's a you know, very, very large pipeline of opportunities that fit our businesses that we're having discussions with. So I'm optimistic that the pipeline's gonna be strong, and the discussions we're having are good ones. And you know, you remember, our capital allocation is very clear. Our first priority is to deploy our free cash flow on strategic acquisitions. It remains a clear priority, and like we're gonna see from Paragon next year, that's how we generate value. And priority two is opportunistic buybacks. As we've shown in the past, if we see a dislocation in our valuation, we're poised to act. Our third priority is a consistently, modestly increasing dividend. Our capital allocation doesn't change, and with a, you know, net leverage of one, we're ideally positioned right now, and there's a lot of activity going on. Excellent. Does that answer your question, Scott? It answers everything fully. Thank you. Yeah. Thank you, sir. Your next question comes from the line of Rob Wertheimer with Melius Research. Please go ahead. Thanks. Good morning, everybody. Good morning, Rob. So, I understand that the kind of delays here and there that you're talking about aren't the biggest driver in the quarter, but I'm still a little bit curious. And so is the project delay- ... often one where you're a small piece of the total project cost, is one question. And the second one is probably pretty easy to answer, given the nature of your business, but is there any pushback on price? Do customers have any option to, to change out? I mean, is there any downshifting or anything like that? I know it's unlikely. Just, probably to sort of check around those dynamics. Yeah. Yeah, the project cost, I think, was your first question, and you're right, we are typically a small portion of the project. And, you know, with good technology, small part of a bigger project. So it's a nice place to be. In terms of pricing, yeah, we have very differentiated technology, and we're conscious of the value that we're adding. What you'll typically see in the, you know, most classic downturns is, they may mix down. They may buy our project, buy our product, but it'll maybe have less features, 'cause we're pretty good position with the customer base and our positions in our niche portfolio. We're not seeing that now, and we're not seeing the activity pipeline change. So I, I think on the, you know, we're, you know, typically smaller projects, you know, typically, you know, priced for value, and we do a lot of investment in our portfolio. So, so I, I think delays are more just related to the general macro that we talked about with Dean, about the, you know, the elections and some of the uncertainty with the geopolitical issues and. But, you know, we, we went through the, or, or, you know, we, we're confident we're not losing share. We're confident that, that our pipelines are, are very strong, so it's a temporary delay. Thank you much. Thank you. Your next question comes from the line of Joe Giordano with TD Cowen. Please go ahead. Hi, good morning. This is Joe Giordano, wondering if you could talk about the Paragon charges you took last quarter. Now that you're another quarter in, do you expect any additional charges? I know they were just one time, but just any update on that, and when you might start seeing any impact from those charges? Yeah, I think, you know, we don't, we don't anticipate another charge. I mean, that's. That doesn't mean we won't change our mind, but we don't anticipate any other charges. That'll be clear. That's clear. Yeah, that activity is going on now. So we're in process of improving that business, of fixing that business, of making it run as efficiently as AMETEK does. And, we have a team of Paragon people and a team of AMETEK people and a team of our operational excellence talent across the business, all working on the project, and the response is very, very solid to it. So I think that's ongoing, and it'll occur through the balance of this year. I think next year you'll start to see the benefits of it, but the project, you recall, goes out, you know, two or three years as we continue to improve it. So I think, you know, next year you have a sizable improvement because we expect the volumes to come back from the destock, combined with the OpEx work that's going on, combined with some new product introductions that we're heavily investing in to phase in. So, you know, it's unfortunate that we have this destock downturn right now, but couldn't be happier with the business. Thank you for that. Another question I had was on the 4Q ramp. So I understand the normal cyclicality, there's usually a 4Q ramp, but it does look like the implied guide implies the ramp is more than usual for historical. Is there, especially considering that you guys are not anticipating any easing in destocking for the latter half, could you comment on what's driving that? Yeah. I kind of disagree with your conclusion. I think there's a tax benefit in Q4, and when you factor that in, we have a pre... I think the ramp is very similar to what it was last year, so it's, and we de-risked Q3. So as I said, the operating performance in the first half of the year is very similar to the operating performance in the second half of the year, and you add to that a little bit of a tax benefit in Q4. So, I don't. I think it's pretty typical from what we've done in the past. Got it. Thank you for that. Very helpful. Yep. Your next question comes from the line of Andrew Obin with Bank of America. Please go ahead. Yes, good morning. Morning, Andrew. Hey, just, going back to inventory, just how to think about it. Are your OEM customers, are they bringing inventory levels back to pre-COVID levels or below pre-COVID levels? I guess just trying to better understand, you know, how to think about the destocking impact, versus, history. And, you know, where do you think inventories will be on a going forward basis relative to pre-COVID levels? Yeah, I think they're, you know, it's different because there's a lot of customers and a lot of different market segments. But in general, I think you're, you know, getting back to pre-COVID levels. It might be slightly higher because of some of the geopolitical things that happened and the supply chains, you know, becoming more regional and less dependent on Asia, so it could be a bit higher. But in general, I believe that the general statement across the customer base, they're, you know, trying to get back to something at the pre-COVID level. They may be a bit higher for some of the other geopolitical issues going on. ... Gotcha. And, just maybe I missed it, but, you know, could you just cover major geographies? So what are we seeing, North America versus Europe versus Asia versus China? I apologize if I missed it. Sure, Andrew. No, you didn't miss it. We saw a modest growth in Europe in the second quarter, and we saw low single digit declines in both the U.S. and Asia. So I mean, you go, you know, a step lower, we had a low single digit in the U.S. We actually had strong growth in our materials analysis division, our A&D businesses, but our automation business was down a bit. Europe was up low single digit. Again, weakness in our automation business offset by strong growth in process. And for Asia, we were down low single digits. You know, it's pretty difficult comps in China. China was down a bit, but when you look at Asia, excluding China, it was flat. So it's kind of a flat world, but we are seeing some improvements in Europe. Thanks so much. Thank you, Andrew. Your next question comes from the line of Steve Barger with KeyBanc Capital Markets. Please go ahead. Thanks. Good morning. Good morning, Steve. Dave, we're hearing a lot of optimism about the semiconductor cycle having a strong 2025, led by AI-related devices, of course, but also some leading-edge node transitions later- Yeah next year. What are you seeing in that business, and are you more levered to node transitions or unit volume increases? Yeah, I think right now, we're levered to both of them. But, you know, in our second quarter, our semiconductor business was up, and it was up because we had strong growth in our CAMECA business, and you think about that business, they're doing next generation defect detection, and it's kind of like you're gonna want one of these CAMECA systems in just about every new fab. And then we also have strong benefits from our Zygo business, and there, we're one of the few businesses that can, you know, operate with technology in the EUV, the extreme UV, and that's more the, you know, transitioning to smaller nodes. Yeah. So, right now, what you see is, even though the market was down tremendously, there's a lot of R&D activity to get at the node transitions, to get at some of the—to be able to detect defects at these smaller nodes. So we're going very well there, driven by the uniqueness of our product portfolio. But then, you know, when the market picks up, we also have a good part of our business is tied to the just to the right production. So, it feels pretty good for us in terms of moving into next year, Steve. Got it. Activity over the past year for mature nodes in domestic Chinese manufacturers has been stronger than I think people expected. Do you have exposure there, and do you have an outlook for that market in the back half and next year? I don't have that level of resolution for next year. We do sell into the Chinese market. It's typically lower technology products. It's been healthy this year. Yeah. Okay, thanks. Thanks, Steve. Your next question comes from the line of Nigel Coe with Wolfe Research. Please go ahead. Oh, good morning. Hi, David. Hi, Dalip and, and Kevin. Hello, Nigel. Thanks for the question. Good, thanks. How about yourself? Just a few more details. I know you covered a lot of ground here, but on Paragon, just want to make sure I've got the right base for FY 2023. I've got about $450-$460 of revenues for FY 2023. Is that about right? Yeah, a little, little bit higher for 2023. Little bit higher for 2023? Okay. Yeah, a little bit higher. Yeah, that's helpful. Yeah. So down 10%-15% this year, I mean, what sort of cost measures are you taking? I know the charge you took in 1Q is much longer tail, but what measures are you taking to sort of preserve the earnings there? Yeah. Where do we stand right now on the accretion for FY 2024? Yeah, I think we're doing a lot of work on the cost structure. There are - they have excess capacity in plants, so that work's going on right now, and we took the charges, also some expenses related to doing the things that are non-accruable, that we're spending. And then, more importantly, there's a lot of new product introductions that are going on, that we're spending on right now, that are very, very, you know, solidly positioned for Paragon. You talk about the accretion for this year. You know, we're - it's a couple of pennies, and it's in the fourth quarter. That's where we're- A couple pennies in the fourth quarter. Yeah. Okay. That's helpful. Thanks, David. And then, on orders, I think you said 4% organic decline. I think that's better than the 8% you saw in the first quarter. I'm calculating $1.6 billion of orders this quarter. Is that in the right zone? Yeah, we, if you look at overall orders, they were up 1.5% in the quarter. 1.5%, okay, that's- Yeah. That's- The overall orders were up 1.5%. Organic orders were down 4%. That's improved from what we saw in Q1, where we were down organically -10%, and we saw a sequential improvement in orders in Q2, so they were up low single digits from Q1. So we're definitely seeing stability in orders and the cadence- No, no question about it. June, June was the strongest. Yeah. And then just a quick one on the 4 Q tax rates, issue, I mean, any quantification there? Yes. I mean, if you, if you think about the way we're seeing our expected tax rate play out, Nigel, Q3, as we said, we're projecting our typical expected tax rate. Q4, we're now projecting a lower expected tax rate in the range of 10%-15%. That lower effective tax rate in Q4 is primarily due to statute expirations. Okay. That brings our expected tax rate for the full year to 17%-18%, which is expected to provide an earnings benefit in the range of $0.10-$0.15 per share in Q4. Okay. Thank you very much. Thank you, Nigel. Since there are no more questions, I will now turn the conference back over to Mr. Kevin Coleman for closing remarks. Please go ahead. Thank you, Meg, and thanks everyone for joining our call today. As a reminder, a replay of the webcast can be accessed in the Investors section of AMETEK.com. Have a great day. This concludes conference call. You may now disconnect.