Good day, and thank you for standing by. Welcome to the Aspen Technology Fiscal Quarter 2022 conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. To ask a question during this session, you will need to press star, then one on your telephone. If you require any assistance, please press star zero. I would now like to hand the conference over to your speaker today, Mr. Brian Denyeau. You may begin. Thank you. Good afternoon, everyone, and thank you for joining us to discuss our financial results for the third quarter of fiscal 2022, ending March 31, 2022. With me on the call today are Antonio Pietri, AspenTech's President and CEO, and Chantelle Breithaupt, the CFO of AspenTech. Before we begin, I will make the Safe Harbor statement that during the course of this call, we may make projections or other forward-looking statements about the financial performance of the company that involve risks and uncertainties. The company's actual results may differ materially from such projections or statements. Factors that might cause such differences include, but are not limited to, those discussed in today's call and contained in our most recently filed Form 10-Q. Also, please note that the following information relates to our current business conditions and our outlook as of today, April 27, 2022. Consistent with our prior practice, we expressly disclaim any obligation to update this information. The structure of today's call will be as follows. Antonio will discuss business highlights from the third quarter and our pending transaction with Emerson, and then Chantelle will review our financial results and discuss our guidance for fiscal year 2022. With that, let me turn the call over to Antonio. Antonio? Okay, thanks, Brian, and thanks to all of you for joining us today. AspenTech's strong third quarter results were driven by further improvement in our key end markets and continued a strong execution by our sales team with the support of the rest of the organization. As we have mentioned previously, we expected the new budget year for our customers to lead to a better spending environment for AspenTech, considering the positive macro indicators coming into the year. I'm pleased to say that this is what occurred during the third quarter. We also remain optimistic about our ability to drive further improvement in annual spend growth over time, considering the continued positive macro environment and the growing strategic importance of operational efficiency and sustainability to our customers. We're also excited to be approaching the completion of our proposed transaction with Emerson. The registration statement on Form S-4 has been declared effective by the SEC, and we have filed our proxy statement and set a May sixteenth date for the special meeting of stockholders to approve the transaction. We believe the combination of our current solutions with the innovation and expertise of OSI and geological simulation software will position the new AspenTech to create greater value for our customers as we help them solve the dual challenge of meeting the increasing global demand for resources in a sustainable manner. We believe our customers can operate sustainably and profitably at the same time. There doesn't need to be a trade-off when you use the right technology. Looking quickly at our financial results in the third quarter, revenue was $187.8 million, GAAP EPS was $1.12, and non-GAAP EPS was $1.38. Annual spend was $655 million, up 2.4% in the quarter and 7.4% year-over-year. Free cash flow was $89.2 million. Looking at our third quarter results in more detail, we experienced a strength across each of our key verticals and regions. As I mentioned, the biggest change in the quarter was the notable improvement in customer spending. Our customers' 2022 budgets are much improved, reflecting our expectations after the uncertainty and challenging conditions of the prior two years. We have already seen a positive impact to our sales cycles as a consequence of the ability of customers to engage in more strategic conversations with us and execute on them. We're optimistic this will have a positive impact across all areas of our business as the year progresses. Looking at our performance by vertical, refining had a particularly strong quarter and its best performance since the pandemic began. Refinery's margins improved throughout the quarter and were at the high end of their historical range. As expected, a normalization of the transportation market drove up the demand for fuels and pushed refinery operating rates to historical high levels. The performance in refining over the last two quarters has returned us to the double-digit annual spend growth in the aspenONE MSC Suite that we generated consistently for many years pre-COVID. Chemicals continue to generate solid growth, and it's an exciting market for us. The industry is increasingly embracing sustainability as an impetus to improve its operational performance while also substantially reducing its environmental footprint. In our conversations with customers, it has become clear that forward-thinking companies that recognize greater investment in digitalization can increase their competitive advantage, drive better financial performance, and move closer to their sustainability goals. The strong performance of chemicals during the pandemic and the multiple tailwinds benefiting this market gives us confidence in the durability of growth from these customers. The E&C vertical continued to show improvement and delivered positive growth for the second consecutive quarter. The tight supply-demand balance for oil resulting in high oil prices, along with increased commitment to emissions reductions in the last few years, has started to have a positive impact on global energy and sustainability CapEx budgets, respectively. The improved macro outlook for this industry is benefiting AspenTech through improvement in attrition rates, which we now expect to come in modestly better than our previously revised range of 5%-5.5%. Longer term, there are three factors that we believe can have a positive impact on our E&C business. The first is expected upcycle in upstream CapEx budgets over the next three to five years, necessary to increase oil supply to address future expected growth in demand. The second is the expected acceleration of sustainability CapEx investments and the pivot that many E&C firms are making towards executing projects in low carbon energy areas like hydrogen, carbon capture and sequestration or CCS, biofuels, wind, solar and other areas. We're beginning to see more activity in these areas among E&Cs and believe it will become an increasingly significant part of their overall businesses in the coming years. The third is the growing importance of energy security rooted in oil and gas, specifically in the short to medium term. Recent events have caused a broader reexamination of where energy is being sourced, is being sourced from, and the need for diversification of suppliers. We expect this to be a significant catalyst for the global LNG industry in the coming years and a key source of incremental CapEx spend. The improved budgets in refining and chemicals and positive trajectory for E&Cs is resulting in a performance above expectations for the year for our aspenONE Engineering Suite. We also remain optimistic about the outlook for our APM business because of the quality and quantity of our pipeline, especially as we focus on closing the year. Following are references to a few of the customer transactions closed in the quarter. First, a global chemical company and long-term customer of AspenTech renewed its agreement for all three suites of our products and solutions. This new agreement increased their annual spend by 15% for a total booking value in excess of $70 million, making it one of our largest customers. The customer further standardized on additional products, such as Aspen Capital Cost Estimator, for the design of new facilities. This company uses AspenTech solutions to run their operations safer, greener, longer, and faster, including for the required reporting on emissions to regulatory authorities. Second, a leading independent player in the European energy and refining industry signed a new agreement to expand its use of our MSC and APM applications. This customer, which operates one of the largest refineries in Europe and the most advanced in terms of plant complexity, decided to increase its usage after a study by AspenTech personnel identified tens of millions of dollars in incremental profitability through operational performance improvement and energy savings and the related reduction in emissions. The deployment of the AspenTech control and optimization solutions in the refinery, including a CO2 emissions dashboard coupled with expansion of Aspen Mtell to a second recently acquired wind farm, will be key solutions to help this customer meet its sustainability and profitability objectives. Third and final, a North American electric vehicles company that manufactures fleet commercial vehicles and SUVs increased its use of the aspenONE Engineering suite to drive collaboration and standardization across production lines in the modeling and manufacture of electric cell batteries by the chemical engineers in these teams. The collaboration capabilities of the suite will drive alignment and knowledge sharing across the teams in the multiple production lines as they ramp up vehicle output. In addition to the examples I've reviewed for this quarter, our latest ESG report, released in Q3 and available on our website, covers several more longer-term examples of our customers are implementing our solutions for sustainability, highlighting the role that digitalization plays in helping companies across diverse industries reduce waste and energy use and meet their emission targets. Stepping back and looking at our business more broadly, our recent results reflect the positive impact from an increased customer focus on operational efficiency and sustainability. As we have discussed in the past, the drive towards the automation and digitalization of assets to run them more efficiently and sustainably is still in the relatively early stages and is a top investment priority for our customers. In a world of growing demand, rising inflationary pressures, and greater scrutiny of the environmental impact of their operations, our customers recognize that being able to do more with less is a strategic imperative. This was evident in the customer and industry conversations I've had while attending CERAWeek recently. CERAWeek, which is run by IHS Markit and now part of S&P Global, is the world's premier energy conference. I've been attending this conference for years, and this year the focus on the need to increase the use of technology to drive efficiency and sustainability was greater than I've ever seen. This is particularly true as it relates to sustainability. Conversations with customers about sustainability are hitting an inflection point, and it is now part of nearly every meeting we have. In particular, the increased activity by regulatory agencies, most notably in Europe, but more recently by the SEC here in the United States about sustainability reporting requirements, is driving customers to take a comprehensive view at their strategy in this area. AspenTech is in a great position to benefit from this trend in two ways, driving material amounts of emissions out of customers' operations while also making it possible to track their progress in a holistic way. While we're pleased about our performance year-to-date and see the conviction from customers globally about transacting in the current quarter, we also recognize that a degree of uncertainty exists in certain markets for AspenTech, such as Russia and related sanctions and China and the spread of COVID-related lockdowns, which could dampen the growth in the quarter. The main concern being these customers' ability to get existing business done before the end of the quarter. This leads us to maintain our current annual spend guidance for fiscal 2022 at 7%-8%. In addition, we're adjusting our fiscal year guidance for attrition to 4.5%-5% compared to 5%-5.5% previously. We're also adjusting the guidance for our APM business to 0.75%-1% growth, compared to approximately 1% growth previously. Finally, we expect to deliver the best-in-class profitability outcome that we guided to for the year and that investors have come to expect from AspenTech. The growing market focus on sustainability is especially exciting, and we look ahead to the opportunities for the new AspenTech and the capabilities that the OSI and geological simulation software businesses that are being contributed by Emerson will bring. These industry-leading solutions are incredibly well-positioned to benefit from the expected increase in capital investments in electrification and CCS around the world. We believe our expanded product portfolio will give new AspenTech a unique ability to benefit from the coming decarbonization transition by enabling existing energy and chemical suppliers to operate with higher levels of efficiency and lower emissions than they ever have before to meet current energy and chemical demand, while also capturing the emissions they produce in CCS systems to further decarbonize their production. In addition, we will enable the design of hydrogen production facilities and will optimize their operation once built, as countries around the world ramp up on the utilization of hydrogen as a clean energy source over the coming years and decades. Finally, we will enable the transition to global electrification from clean energy sources by supporting the dramatic increase in power transmission and distribution capacity that is required to meet many of the ambitious sustainability targets that countries and companies have committed themselves to over the next 10-30 years. It is important to note that the sustainability imperative is kicking off a massive CapEx investment cycle that will need to continue and increase for the next 30-40 years. For example, according to S&P Global, the total CapEx spending in the global energy sector supply side in 2021 was $1.5 trillion. About 30% or $450 billion is spent on low carbon power, which includes hydrogen, CCS, wind, solar, and other forms of renewables. 23% of that figure, or $104 billion, is in transmission and distribution infrastructure. 22% or $99 billion is spent in each of the upstream and on hydro renewable sectors. 33% or approximately $150 billion on solar or photovoltaic power systems. Furthermore, carbon capture and sequestration is estimated to be a $4 trillion market by 2050 according to ExxonMobil, as compared to the $6.5 trillion market for oil and gas today that they estimate. What all this says is that going forward, AspenTech will benefit from a major CapEx investment cycle where the products of the new AspenTech will be uniquely positioned to enable our customers to design, operate, and maintain these new facilities. We're excited about the future for AspenTech. The plans to integrate the OSI and geological simulation software into the new AspenTech and the commercial agreement that will deepen our partnership with Emerson have grown our conviction for an exciting future. We remain confident in new AspenTech's ability to be a consistent mid-teens grower with high recurrent revenue, best-in-class margin, and substantial free cash flow. We're looking forward to completing the transaction as soon as possible and getting to work executing on our strategic plan. Before turning it over to Chantelle, I would like to formally welcome Manish Chawla, who recently joined AspenTech in the newly created position of Chief Revenue Officer, where he will lead all revenue-generating functions of the company. Manish joins AspenTech after spending the past 14 years at IBM, where he was most recently the Global General Manager of the industrial sector. He's led IBM's efforts around energy transition, sustainability, and Industry 4.0, and has extensive experience scaling large global organizations. I'm thrilled to welcome Manish to AspenTech's senior leadership team and look forward to his contributions to our success. Manish will be assuming the leadership of our operations team from John Hague, who has decided to retire after 27 years with AspenTech. John will remain in AspenTech until October first, supporting the integration efforts of OSI and GSS and leading the commercial team that will support the Emerson sales team, taking AspenTech solutions into a number of their key markets. John has been an important and valued leader at AspenTech in a number of roles over the years, most recently as EVP of Operations. On behalf of everybody at AspenTech, I want to thank John for all he's done for the company and wish him all the best in his future retirement. I would like to finish by just reiterating how pleased we are with our performance so far in fiscal 2022. We're delivering better than expected growth, high profitability, and free cash flow, and have made significant progress preparing for the completion of our transaction with Emerson. We believe market trends are clearly in our favor and provide a favorable setup for us to deliver on our long-term financial targets and generate significant value for our shareholders. Now, let me turn the call over to Chantelle. Chantelle? Thank you, Antonio. I will now review our financial results for the third quarter of fiscal 2022. As a reminder, these results are being reported under ASC 606, which has a material impact on both the timing and method of revenue recognition for our term license contracts. Our license revenue is heavily impacted by the timing of bookings and more specifically, renewal bookings. A decrease or increase in bookings between fiscal periods resulting from a change in the amount of term license contracts up for renewal is not an indicator of the health or growth of our business. The timing of renewals is not linear between quarters or fiscal years, and this nonlinearity will have a significant impact on the timing of our revenue. As a result, we believe our income statement will provide an inconsistent view into our financial performance, especially when comparing between fiscal periods. In our view, annual spend will continue to be the most important metric in assessing the growth of our business. Annual free cash flow, the most important metric for assessing the overall value of our business generates. Annual spend, which represents the accumulated value of all the current term license agreements at the end of each period, was $655 million at the end of the third quarter. This represented an increase of approximately 7.4% on a year-over-year basis and 2.4% sequentially. Total bookings, which are defined as the total value of customer term license contracts, where the associated term licenses were being delivered in the quarter under Topic 606, was $207 million, an 18% increase year-over-year. Total revenue was $187.8 million for the third quarter. Turning to profitability beginning on a GAAP basis. Operating expenses for the quarter were $93.4 million compared to $77.8 million in the year-ago period. The year-over-year increase in GAAP operating expenses were primarily driven by acquisition and integration planning related expenses associated with our pending transaction with Emerson. Total expenses, including cost of revenue, were $107 million, which was up from $93.8 million in the year-ago period. Operating income was $80.8 million, and net income for the quarter was $75.1 million or $1.12 per share. Turning to non-GAAP results. Excluding the impact of stock-based compensation expense, amortization of intangibles associated with acquisitions and integration planning-related fees, we reported non-GAAP operating income for the third quarter of $102.5 million, representing a 54.6% non-GAAP operating margin compared to a non-GAAP operating income margin of $80.9 million and 49.7% respectively in the year ago period. As a reminder, margins will fluctuate period to period due to the timing of customer renewals and therefore license revenue recognized during the quarter. Non-GAAP net income was $92.3 million or $1.38 per share based on 67 million shares outstanding. Turning to the balance sheet and cash flow. We ended the quarter with approximately $285 million of cash and cash equivalents, and $279 million outstanding under our credit facility. In the third quarter, we generated $81.1 million of cash from operations and $89.2 million of free cash flow after taking into consideration the net impact of capital expenditures, capitalized software, acquisition, and integration planning-related payments. Before turning to guidance, I would like to provide an update on our preparation for the closing of the Emerson transaction and the integration of both OSI and Geological Simulation Software. We have made significant progress in recent months, developing a comprehensive integration plan with detailed timelines and action plans to realize our targeted synergies. We are confident in our ability to deliver on the $110 million of synergies we announced at the time of the transaction. I would now like to close with guidance. Our updated outlook reflects the strong performance year-to-date and improving demand trends we see in many areas of our business. We believe the importance of asset optimization and sustainability are durable growth drivers that will benefit our business for years to come. With respect to annual spend, as Antonio mentioned, we are maintaining our outlook for the year at 7%-8% growth. We are maintaining our bookings guidance range to $814 million-$840 million, which includes $486 million of contracts that are up for renewal in fiscal 2022. This includes approximately $191 million of contracts up for renewal in the fourth quarter. Our expected revenue range is now $737 million-$754 million. We now expect license revenue in the range of $513 million-$530 million, and maintenance revenue and service and other revenue of approximately $196 million and $28 million, respectively. From an expense perspective, we now expect total GAAP expenses of $410 million-$415 million. This outlook continues to incorporate ongoing investments in our go-to-market organization, product development, and business units, including APM, AIoT, and pharmaceuticals. We expect GAAP operating income in the range of $327 million-$339 million for fiscal 2022, with GAAP net income of approximately $299 million-$310 million. We expect GAAP net income per share to be in the range of $4.43-$4.59. From a non-GAAP perspective, we now expect non-GAAP operating income of $404 million-$416 million and now expect non-GAAP income per share in the range of $5.33-$5.50. From a free cash flow perspective, we are now targeting free cash flow of at least $285 million. Our updated fiscal 2022 free cash flow guidance still assumes cash tax payments in the range of $60 million-$66 million. Our free cash flow outlook is equivalent to between 42% and 43% of annual spend and highlights our predictable and sustained cash generation. To wrap up, AspenTech delivered strong third quarter results. We are performing well and capitalizing on the market opportunities to generate faster, consistent growth. We look forward to completing our transaction with Emerson later this quarter, which we believe will expand our capabilities to create even greater value for our customers and shareholders. Operator, we would now like to begin the Q&A. Certainly. As a reminder, to ask a question, you need to press star one on your touchtone telephone. To withdraw your question, please press the pound key. Our first question comes from Jason Celino of KeyBanc. Your line is open. Good afternoon, Jason. Yep. Hey, Antonio. Thanks for taking my question. Maybe just a quick clarification, you know, on the guidance because I think you're leaving the full year annual spend range the same, but I think attrition is a little bit better, but it sounds like APM is maybe nominally a little lower. Can you just walk us through kind of the moving pieces there? Well, I mean, look, certainly, we've captured some of the benefit from the improvement in attrition through the Q3 quarter. Attrition in Q4 will be in line with expectations. Fundamentally, the combination, we still believe that, you know, the high end of the range is very achievable and possibly north of that. That is through the combination of our ongoing performance, MSC, Engineering, and APM being at the high end of that range. At the same time, like we enumerated in the prepared remarks, you know, we closed some business in Russia in Q3, there's increasing difficulty from the implementation of sanctions, and that could provide a little bit of downside in the quarter. It's not that the business isn't there, it's just that it would take longer to close. Then we're monitoring the lockdowns, the rollout of lockdowns in China. Not that the business would disappear, but as we experienced over the last two years, when people are not able to come out of their homes. They're not able to then work on the contracting of these, and they've been already very bureaucratic as it is. We're just taking a cautious approach here with regards to changing the range, meaning we're not changing it, we're leaving it at 7-8. At the same time, you know, the same trends that we saw in Q3, we're still seeing in Q4, and for that reason, we decided to maintain our guidance at 7-8. Okay. Perfect. That seems fair. Maybe one last just housekeeping question. Just so we all have it, but is the vote in May, is that the last kind of hurdle before the deal closes, or is there anything else that needs to be approved? Thanks. Hey, Jason, it's Chantelle. Nice to hear from you. What I would say in response to that, Jason, is it's one of the steps required, and we'll go through all the steps required before we Okay. Perfect. Thank you. I'll pass it on. You're welcome. Thank you. Our next question comes from Rob Oliver of Baird. Your line's open. Hi, Rob. Great. Hi, Antonio. Hi, Chantelle. Just a couple from me. First, Antonio, you mentioned that sales cycles are shortening a bit, and I just wanted to probe for a little bit more color on that. You know, I know you listed some of the drivers for the strong annual spend, but is it emerging from the pandemic, we're seeing more activity levels? Is it people just reacting more briskly to some of the geopolitical and/or price issues and better budgets? And then how do those sales cycles compare to, you know, what you've seen historically? And then I had a quick follow-up. Yeah. Well, that's exactly the point, Rob. The sales cycles are going back to their historical cycle pre-pandemic. They elongated during the pandemic, and now they're going back to their historical level or length, but also they're more predictable. To us, that's the fundamental difference is the predictability and our ability to close business when we believe it can be closed, and that's been a significant difference in the Q2 and Q3 quarters here. I do think the spending environment has completely changed. I also think there's been a little bit of pent-up demand, of course, in Q3 after two years of suppressed spending. We also saw a little bit of business from Q4 moving to Q3, which certainly delivered a very strong Q3 quarter for us. Overall, a much easier environment to be doing business in. Got it. That's great. The follow-up for me, you mentioned Russia and how that along with China contributed to your thinking relative to maintaining the annual spend guide in Q4, even with the better attrition. I just wanted to ask on that. I mean, we've seen. You know, you guys have a longstanding presence in Russia with a lot of strong relationships. You know, how does this play out? I mean, we're seeing companies like SAP that are abandoning Russia altogether. They're also mission critical for a lot of the companies that they serve. I know you guys are as well. How should we think about the ultimate risk relative to Russia for you guys? I know you said you even closed a deal there in Q3, but just help us contextualize that if you can. Thank you. Well, I mean, we start with, look, less than 5% of our annual spend is in Russia, and these are 5-6-year contracts, so that 5% is spread over the next five years. Look, while our technology is not sanctioned today, and we're still doing business there, the environment to do that business is becoming increasingly more difficult as a result of sanctions in banks that our customers have used for business, banks that our own employees have been using for us to pay, refund their business expenses. In some cases, a little bit of issue around collections and that's why you see also our free cash flow projection for the year at the midpoint, being cautious about potential collection issues in Russia. Having said all that, in a way, in Q3, we did what we thought we could do, in the quarter. You know, we're just being cautious about it. We don't wanna get ahead of our skis with respect to Russia or China. You know, Beijing is starting to get into lockdowns in China. Most of the headquarters of the companies we deal with in China are in Beijing. If these employees are not able to leave their homes, then they're not gonna be able to press the button on the SAP system, so to get those agreements done. Just being cautious about it. We haven't really seen any change yet in those markets, but just being cautious. Great. Thanks very much. Thanks. Our next question comes from Andrew Obin of Bank of America. Your line is open. Yes. Hi. And- Hi, Antonio. Hi, Chantelle. Congratulations. Thank you. One of the questions we got a lot today, how should we think about your cost inflation and what's the dialogue with your customers on pricing beyond your regular business model, if you could just comment on that. That's- If you're looking at the results, your margins seem to be A-okay. Yeah. No, correct. Our margins are very healthy. Let me take the last point. Look, as you're well aware, Andrew, our contracts on average have 2%-3% price escalation that historically we've talked to customers as being tied to CPI. Over a five- or six-year contract, our prices move up 15%-18% for those customers. In a way, every year we are increasing prices on our customers. That allows us to maintain, in that regard, the gross margins and profitability for our software business. With regards to personnel inflation, if you will, cost inflation of salaries. It's something that of course we're keeping a very close eye on. We believe our financial discipline, which is also tied to the different levers that we use in the company to compensate and create an attractive rewards program for our employees, will allow us to manage through this. We've hired hundreds of people over the last 12 months into the company. We continue to bring them in at the price points, the salary points that are in line with the profitability that we will deliver in the future. Overall, we're very confident about our ability to manage through this inflationary period at the moment. Thank you. Just to follow up, you're sort of in this unique position, you do a report, you have a mid-year. As you're thinking about conversations with your customers for remainder of calendar 2022, can you just tell us, give us more color as to right, because they are on a calendar year budget and you're on your fiscal year budget. You know, how does it look to things accelerate into the calendar year? More importantly, does the nature of your conversation with your customers changing, right? Because of going forward, you're gonna be closely aligned with Emerson. Do these sort of hardware capabilities change how you interact with your customers and the kind of conversations you're starting to have? Thank you. Well, let me look at, first of all, since our customers' fiscal year is the calendar year and the budget is for the calendar fiscal year, the outlook for the rest of the calendar year is supported by these strong budgets that they put in place, for this calendar year. We would expect that Q4, Q1, and Q2, meaning the June, September, and December quarters are still gonna reflect the strength in spending that we saw in this March quarter. You know, depending on the macro situation towards the end of this calendar year, you know, new budgets for calendar 2023 will dictate the spending environment then. Look, our conversation. Let me just first say the following. We're absolutely convinced that the focus on sustainability and investments in that area are changing the conversations with our customers in a material manner. Now it's not only we need AspenTech solutions for profitability purposes, we need AspenTech solutions for profitability and sustainability reasons. This is a significant shift by our customers. We started to see it in Europe a year and a half ago. It's now showing up in the United States and in Asia as well, and we're very bullish about this. With respect to Emerson, absolutely. You see customers that are both users of Emerson and AspenTech, and they themselves are thinking about the possibilities from combined solutions between Emerson and AspenTech. how the synergies from the two relationships into that customer, and other areas of collaboration. Including co-innovation between customer Emerson and AspenTech, to help them address sustainability or operational excellence issues. We're all very excited about this, and that's what we also put it in the prepared remarks. I think it's a very exciting time for AspenTech and the new AspenTech going forward. Antonio, Chantelle, thanks so much for fitting me in. All right. Thank you. Thank you, Andrew. Our next question comes from Matt Pfau of William Blair. Your line is open. Matt? Hey, great. Thanks, guys. I appreciate it. Yeah, Antonio, it seems like the Engineering and MSC suites are certainly performing ahead of your expectations. You know, APM may be a bit below what you were expecting. Why is APM not seeing the same sort of increase in or improvement in traction that MSC and Engineering are? Yeah. Well, I mean, look, first of all, I'm particularly very excited about the quality and quantity of our APM pipeline, frankly. I don't think we've had a better quality pipeline since the beginning of that business. The quantity, it's all there. And certainly more than what we need to deliver on the guidance that we gave you. Having said that, look, I said that in my opinion there was a little bit of pent-up demand in the March quarter because of a lack of spending over the last two years. The easiest thing to do when you wanna spend and you're really you've fallen behind on your automation and digitalization plans is to go with what you know and the low-hanging fruit, which is advanced process control, optimization, planning, scheduling, historian, and so on. Then you start to focus on new technologies, new areas of technology spending, and I think that's APM. We have a pipeline in Q4 that we're very excited about, and you know, we're working to close it. At the same time, look, some of that pipeline is in a couple of the places that we referred to on the call, Russia and China. We're just being cautious about it as well. Makes sense. Then you sort of called out one positive trend going forward could be as people look to diversify their energy suppliers. How do we think about that, you know, mechanically in terms of how that impacts Aspen? Is that something that's fairly long term? You know, are there any specific areas within your product suite that benefits more than others? Yeah. You know, Matt, in 2019, really towards the end of 2019, beginning of 2020, I was talking to you guys and investors about this wave of CapEx spending in LNG around gas. That CapEx wave, which was estimated to be about $125 billion over five years, sort of dissipated with the pandemic in 2020, and a lot of that investment was put on hold. We believe that certainly the geopolitical situation in Europe around Ukraine is refocusing countries and customers on LNG as an alternative fuel, both low carbon, but also a diversification of supplies. We expect to see the CapEx spend around LNG to get you know started again and provide a lift for our E&C customers initially because these plants and terminals have to be designed first. That would be the main driver initially. Of course, you know, oil will continue. CapEx in oil will probably continue to increase low- to mid-single-digit% as a result of the need for more oil supply over the next three to five years, and that will also be a benefit. More importantly, LNG CapEx, which in 2019 we were talking about $125 billion over a five-year period. Great. Thanks, guys. Appreciate it. Thank you. As a reminder, to ask questions, please press star one on your telephone. To withdraw your question, please press the pound key. Our next question comes from Mark Schappel of Loop Capital. Your line's open. Hi, Mark. Hi. Thank you. Hi, guys. Thanks for taking my question. With respect to your prepared remarks, Antonio, around customers in China, I was wondering if you could just remind us how much of your annual spend comes out of China. Yeah. Similarly to Russia, just about 5%. Yeah. About 5%. Great. Okay. Switching gears a little bit here, with respect to the pharma business, it's been about a year now since a new general manager was hired or appointed to that business. I was wondering if you could just give us an update, what you're seeing there. Yeah. I mean, look, pharma certainly it's an opportunity for us and, you know, a lot of the work that was put in place when he first joined and, but this time last year was an investment in R&D that will start to bear fruit later this year in our next release of software in November. And then, you know, our go-to-market activities sort of organically around that. You know, we continue to execute, again, pharma materially to our overall results is not there yet, but we're still optimistic. We've also said that we would like to make a sort of an acquisition to have an anchor tenant in pharma as well, and that's something that we haven't been able to execute on, but we continue to see what opportunities are in the market. But yeah, no, you know, pharma continues in its trajectory and it's something that, you know, we're still focused on, so. Good. Thank you. Mm-hmm. Again, ladies and gentlemen, I'm showing no further questions at this time. I would now like to turn the conference back over to CEO, Antonio Pietri, for closing remarks. All right. Well, thank you, operator, and thank you to everyone for joining the call today. We look forward to actually attending a few of the investor conferences in person this quarter and meeting with some of you as well in person and the callbacks that we will have. Thank you to everyone. This concludes today's conference. Thank you for participating. You may now disconnect.