Hello? Hello, hello. Can everyone hear me? Yes. Okay, awesome. Hello, and welcome to everyone joining us today for AspenTech's 2024 Investor Day. My name is Will Dyke, and I'm Director of IR here at AspenTech. I see many new and familiar faces in the audiences, in the audience today, so welcome everyone. Welcome to those who traveled from far distances to be with us here today. We appreciate that. This is never easy, so, so welcome. Thank you to everyone joining us from the local Boston community. It's great to see you here, and welcome to our investors joining us online. I'd also like to give a special welcome to our board of directors here with us in attendance today. Robert Whelan, also known as Bob, the Chair of the AspenTech Board; Ram Krishnan, Emerson's COO, and Emerson's representative on the AspenTech board; Karen Golz, David Henshall, and Patrick Bartels. Welcome. Okay, so, to kick things off, I'm just gonna give a quick overview of the presentation, and then a few disclaimers. Antonio Pietri, our President and CEO, will start us off today, with an overview of what we call the AspenTech opportunity. Dr. Vikas Dole, VP of Product Management, and Dr. Heiko Claussen, will speak to how we drive ACV growth. Dr. Vikas Dole is the VP of Product Management. I believe I said that Dr. Heiko Claussen is Co-CTO and Head of AI. Sonali Singh, VP of Product Management for Engineering, Sally Jacquemin, VP of Power and Utilities, and Alex Kalafatis, VP of Product Management for MSC, will speak to how we create value for our customers. David Baker, our CFO, will wrap up with presentation on the financials and how we create shareholder value. And then finally, we will close with Q&A from 4:30 P.M. to 5:00 P.M. Okay, so now turning to our safe harbor, I would like to take this opportunity to remind you that our remarks today will include forward-looking statements. Actual results may differ materially from those contemplated by these forward-looking statements. Factors that could cause these results to differ materially are set forth in this slide, in our annual report on Form 10-K, and other subsequent filings with the SEC. Any forward-looking statements that we make during this presentation are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events. Now for our last disclaimer slide, and before I exit, just today, during today's presentation, we will present both GAAP and certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in the investor presentation. This presentation also includes an explanation regarding the impact of ASC Topic 606 on our financial results, and definitions of annual contract value, or ACV, ACV margin, and free cash flow, among other metrics. This investor presentation is available on our IR website for download. That will be available at 5 P.M. today. We ask that investors refer to it and its definitions in conjunction with today's events. In addition, please note that the ACV figures you see here today do not include Russia ACV, per our write-off in the fourth quarter of fiscal 2024. We have included additional disclosures around this event in our appendix. Finally, I would just ask that no questions from the live audience here. Thank you. With that, please allow me to welcome everyone again to AspenTech's 2024 Investor Day: Trusted to Transform. For more than forty years, we've been collaborating with customers, innovating, delivering results. We were founded to transform. We came together to push boundaries, evolved to run to the limits of performance, expanded to drive uptime through insights. We are committed to lead, solving more and more complex challenges, driving more transformations, innovating to create more and more value. Whatever we've done, wherever we've been, it always comes down to this: optimizing for performance, resiliency, sustainability for our world, enabling our customers each step of the way. We've built the expertise, gained the respect, earned the trust to be in the unique position to solve the biggest, most complex challenges facing us all, to optimize what's new, what's next, what's needed. AspenTech, trusted to transform. All right. Good afternoon, and welcome, everyone, not only those of you here present today, but also everyone that is joining us via the webcast. We're very excited to be doing this Investor Day today. The last one we held was in 2020, just as at the beginning of the pandemic, and the last live in-person Investor Day was in 2019. Trusted to transform. In a way, AspenTech has been trusted by our customers to transform the process industries, and we have done so. Equally, the last two years have been transformational for Aspen Technology. After the Emerson transaction, the company expanded, doubled in employees, and in a way, we embarked on a journey of transformation. Transformation of the assets that Emerson contributed to Aspen Technology, and transformation of Aspen Technology as a whole. So today, we wanna make sure that you walk away with a clear understanding of AspenTech today and AspenTech going forward. So the takeaways that we want you to walk away with are: the opportunity that is in front of Aspen Technology, the opportunity that's been created in the last two years, why Aspen Technology is so uniquely positioned for this opportunity, a target operating model that we will disclose in a few moments, the significant value creation that will be generated from that, from achieving that target operating model, and how we're gonna deliver on that target operating model. And then, I know a lot of you are always asking me questions about what are the dynamics, what are the things that drive our performance? So we also want you to walk away with a very clear understanding of the dynamics, the end market dynamics that drive spend on Aspen Technology. So AspenTech today is a diversified leader in mission-critical industrial software, benefiting from access to the scale and capabilities of Emerson Electric. Industrial customers today confront the dual challenge, which is meeting that increasing demand for resources from a growing population and doing so in a sustainable manner. And digitalization is absolutely an enabler of the dual challenge and how the world will become more sustainable. AspenTech, precisely, to be precise, is 43 years old, August twelfth of this year. We were founded in 1981, and really, it's been about innovation. The original technology of Aspen Technology was developed at MIT, the Aspen Plus product, and that product's still around today with five years of product roadmap, is our second-largest product in the company. And we also wanna make sure that you understand how we're gonna drive growth in this company to double digit, and how we're gonna achieve best-in-class profitability, just like it was prior to the Emerson transaction. But before we do that, I wanna tell you why customers trust AspenTech. Customers trust AspenTech because our innovation is being transformative for their operations. We've driven their operations to be more safe, more sustainable, more reliable, and more profitable. Our products are mission-critical, and the breadth and depth of those capabilities is what differentiates Aspen Technology from other competitors in the marketplace. At the same time, our products are mission-critical because they drive huge value for our customers. Not only financial results, but also drives our customers to achieve their sustainability goals and makes their operations more resilient or reliable. At the beginning of my career, I used to be an applications engineer, and I would go out and do benefits analysis to estimate the value from the implementation of advanced control in refinery process units. And unless you demonstrated that that customer was gonna recover the investment in less than one year, that project wasn't approved. And today, we know that our solutions and products drive greater than twenty-five to one return on investment, and frankly, in some instances, much larger than that. Ultimately, most of our customers, if you listen to them and you go on their websites, their main goal is operational excellence. Operational excellence is enabled by organizational excellence, and that's what our products enable. Our technology is an enabler of business processes and best practices that deliver the organizational excellence, that supports operational excellence for our customers. The agility, the guidance, the automation. All of that is possible because of our people, the people that work in Aspen Technology. These are incredibly talented people with huge domain expertise, and I would argue, more importantly, huge passion for the industries that we serve. It is that passion that makes a difference, why we're trusted to be innovative, we're respected, we committed to the results, huge credibility, and focused on results. That's what creates a global leader in industrial software. So just a quick history, a quick walk through our history. Aspen MIT Project, 1981, just to make it out, Aspen Project, Advanced Solutions for Process Engineering, not the town of Aspen, Colorado. The company was a process modeling and simulation company until the mid-nineties, when the founder and CEO of the company at the time executed on an incredibly visionary strategy, which was to consolidate the advanced solution space in the process industries. And between 1994 and 2002, we acquired 23 companies that brought to us best-in-class technology. First of a kind in almost every category. I became CEO of Aspen Technology, October 1st, 2013. It'll be 11 years in two weeks, and we declared our strategy to be asset optimization, extending ourselves from the design and operation of these facilities to the maintenance, to the reliabilities. How do we improve reliability? And of course, over two years ago, we did the Emerson transaction, where we have extended our our asset optimization strategy, but we've diversified the company. We're into many more industries today, with many more solutions at scale. $1.1 billion in revenue, over $900 million in ACV, and certainly on a path to double-digit growth and best-in-class profitability. Our strategy is very simply stated, is asset optimization, is about optimizing across the full asset lifecycle, optimizing across the design, operation, and maintenance of these assets to drive a greater value, and that is safety, sustainability, reliability, and profitability. It's about pushing the boundaries of what's possible. Our engineering software is used in research departments to develop new products and then the process technology that will manufacture those products. Our Manufacturing Supply Chain solutions are used to drive these assets when in operations, to operate at the limits of design and sometimes beyond the limits of design capacity, because we know we have some customers operating their units at 105%-110% of design capacity, and doing that safely. It's about driving uptime through better predictive analytics to understand both equipment failure and process degradation. Of course, with the contribution of the OSI business, DGM, into AspenTech, it's about creating a more resilient grid, critical infrastructure, not only in the United States, but around the world. These are the suites that constitute Aspen Technology today. Five suites. Our original three suites before the Emerson transaction, our Performance Engineering suite, which is about optimizing design and optimization across the asset lifecycle. It's about manufacturing and maximizing margins and achieving sustainability goals. It's about increasing asset reliability, and then with the Subsurface Science and Engineering suite, it's about addressing very complex problems in exploration and production. It's how do we, how do we improve the identification of oil and gas deposits, and how do we improve the rate of production in those deposits? And with our Digital Grid Management suite, it's about creating a more resilient grid. It's about managing and operating a grid. It's about keeping the lights on when you need them on as well. And we wanna talk about our industrial data fabric. This is an acquisition that we made in August of 2022, our Inmation acquisition. We have not talked much about it, because we wanna make sure that we gave ourselves the time to integrate it, understand how we needed to go to market with this suite, but today, we're ready. Inmation is about enterprise data management. It's about industrial data fabric. It's about the aggregation of billions of points of data. It's about giving data a structure. It's about correlating data. It's about cleansing data. It's about contextualizing data and then visualizing that data. So if you think about the data world out there, one of the things that I started to hear three, four years ago from our customers was, "Look, we have all this data. The cloud services providers have done a great job convincing us to move all of our data to the cloud," but that data wasn't contextualized. It wasn't cleansed, it wasn't correlated. They didn't know what to do with that data. They were not acting on that data. There was a level of frustration that existed in our customer base, and not only data from AspenTech products, but data from across their ecosystem, and therefore, there was a need to develop a data fabric that would aggregate and contextualize data in order to organize this data so that you could act upon it, so Inmation is about this. It was a product that a company that was founded about 12 years ago. We bought it a couple of years ago already, and the product was jointly developed with companies like BASF, Boehringer Ingelheim, Takeda, Bayer, and today this product is running at BASF, for example, where it handles 3 million data streams daily. It aggregates data from over 1,000 OT and IT systems. It's installed in 50 countries around the world on 200 manufacturing sites, and it's taking data from all these manufacturing facilities, not only process data or AspenTech data, but data from any system, whether it's maintenance data, whether it's IT data, and it's all aggregated into a on-prem data lake. It has a data model that organizes data, correlated data that you can then act upon, including AspenTech. So our products today will have native integration to Inmation. Inmation will become the data fabric for our products, but also for any third-party product as well. We're incredibly excited about this acquisition and what Inmation will mean to AspenTech as we focus on delivering on the Self-Optimizing Asset, as we focus on delivering on solutions going forward, and our own AI capabilities. So look, all of this has produced product and market leadership. These are some of the statistics around each of our end markets. And as you can see, 20 of the 20 largest energy companies, 19 out of the 20 largest Chemicals companies, 20 out of the 20 largest EPC companies, and with the DGM suite, now 10 of 20 of the largest utility companies in the U.S. and around the world. What does that mean? 66% of the global refining capacity, and I'm sorry to chuckle, because the statistic is mind-boggling. 66% of the global refining capacity is optimized by Aspen Technology. Our engineering suite was used on a Chemicals project, the largest single-phase Chemicals facility built in the world at the time, a $20 billion CapEx investment by this Middle East oil company. And through the use of our Fidelis product, they identified $1 billion in CapEx savings. 5% of the total, but $1 billion. We also modeled with our Fidelis product, the entire value chain for a Middle East country. This country is investing a lot in building facilities, not only oil and gas and Chemicals facilities, but also facilities around hydrogen biofuels. And they're interested in understanding not only what is the system performance, but the risk analysis for all these new facilities, but what infrastructure will be required. The entire country operations are modeled in our products. We also manage and operate the largest synchronous grid in the world, in India, 430 gigawatts of electricity that is managed and transmitted daily. We are responsible for managing also the entire gas distribution network of Spain, including LNG facilities and delivery stations, and the pipelines into France and Morocco. This is a new statistic that, frankly, I became aware of in the last week. 64 million residential and industrial meters are managed and operated by Aspen Technology through our advanced distribution management solutions. Outstanding statistics that reflect how mission-critical AspenTech is, but how important we are to the global economy. This is just a simple list of products and our market position that is found in all these five suites. Frankly, we could have flooded this on with a lot more, a lot more those statistics, but this is our top products, and it's either number one or number two in most categories. This just shows you the breadth and depth of capability that exists in each of the suites, but also in all suites and across the suites. And it's incredibly powerful set of offerings that is what drives AspenTech forward. In addition, these same products, in 2019, we estimated what is a value that our install base is creating in Chemicals, in refining, and with EPC customers, and we estimated that value to be $59 billion, and the emission reductions from our solutions to be 16 million metric tons in refining. The equivalent value in refining is $22 out of the $59 billion. I don't know if you understand the magnitude, but if you wanna build a direct air carbon capture facility today, a global scale, which is about 1 million metric tons per year, that is gonna cost you about $500 million to do that. We deliver 16 million metric tons with an annual spend of about $900 million, okay? So you can do the math on the correlation between the efficiencies and CO2 emission reductions that can be driven with AspenTech solutions versus technologies that are being driven into the market today. So great capabilities. And what's exciting, though, is that now with Emerson, we can fully have an integrated stack of capabilities. AspenTech's optimization software integrated with Emerson's automation capabilities, sensors, and ability to act on the output from our optimization technology. The ability to deliver closed-loop control down to the valve, an Emerson valve, by leveraging operations data, enhanced decision support, and so on. And this is the future opportunity that exists between AspenTech and Emerson, our ability to create a fully integrated stack of technology from the control valve and the automation sensor in the plant through to very sophisticated optimization technology from AspenTech. Incredible potential, I'm very excited about this. So look, let's talk specifically about why we're so excited about the opportunity. The dual challenge really came into focus in 2021, when countries and companies started to declare net zero emission ambition goals by 2050. Okay, some countries have chosen different dates, 2060, 2070, but this brought into focus this challenge of: How do we achieve those sustainability goals while we have growth in global population, while we have increasing demand for products, which is sort of a counterpoint to reducing emissions? And this dual challenge is what drives our mission going forward. If you look at the secular trend behind the dual challenge, population growth will hit 9.7 billion people by 2050, today, just over 8 billion. The middle and upper class will expand by 40% by 2030. And what happens when a standard of living increases? Everyone consumes more, demands more Chemicals, demands more energy. So all these are positive trends that will drive-... Chemicals demand [will increase] by 300% by 2050. Energy consumption will increase by 34% by 2050 as well. 86% of that has to come from electricity, global electrification, and 84% of 86% has to be renewable electricity. This is complexity in the grid. Out of COP28 in Dubai this year, what you saw was a declaration, doubling energy efficiency by 2030 and tripling renewables by 2030. Doubling efficiencies is music to our ears because that's what we do, and we've been doing [it] for the last 40 years. Tripling renewables is about wind and solar power, which increases complexity of the grid, and therefore drives more digitalization of the grid going forward, expansion of the grid. These are very important trends that will drive increasing use of the technologies and capabilities of AspenTech. Now, those ambitions drive this CapEx spend. And the one thing to understand is that, in a way, before the transaction with Emerson, AspenTech depended on that $10 trillion to the left-hand side of the screen for you, where it was oil and gas, Chemicals, and refining CapEx. But also, the important thing to understand is that this is now a more stable CapEx spend. I feel like the last ten years, my tenure as CEO, I've been dealing with incredible disruptions to the macro environment, crash in oil prices in 2016, COVID in 2020, and our growth rate has swung from double digit to mid-single digit back to double digit, driven by these macro disruptions. But as you look forward, greater discipline in managing oil and gas CapEx, because the stability in oil prices, the discipline that the CEOs of oil companies are driving is much greater, and therefore, I believe that we'll have a more predictable oil price and therefore, CapEx spend environment. You look at the CapEx investments required to meet net zero, it says $4 trillion by 2030. But frankly, any conference that you attend, it's two to four trillion dollars per year by 2030. $100-$130 trillion in capabilities to produce biofuels, to produce, to do carbon capture and sequestration, to produce hydrogen, to electrify the planet, and therefore, $3 trillion in grid infrastructure by 2030. And all of that then driving digitalization spend. About $5 trillion of CapEx or OpEx around digitalization spend by 2050 to achieve these goals. So when you take all this into account and the dual challenge, what you see is an evolution of missions by company. Companies like ExxonMobil, if you go on their websites, of any of these companies, you'll see it's not only about producing oil or refined products, it's also about reducing emissions. Same thing with Exelon, it's really transmission and distribution of electricity in a reliable, safe, and sustainable manner, or Wood is, is about creating a more sustainable world. This wasn't the case ten years ago. It was about produce, produce, produce, transmit, transmit, transmit, and this is a sustainability opportunity. At the same time, these companies, as their missions are changing, are transforming their strategy, and as I travel the world, it's become an incredibly interesting and exciting world. A company like Eni, the national oil company, now private and really an international oil company of Italy, were from being an integrated oil company to being the one of the foremost producers of biofuels. As a matter of fact, they announced a transaction with a private equity firm, where their biofuels business was valued at $10.2 billion. But Eni is converting their refineries, oil refineries into biofuel refineries, and Aspen Technology was asked by Eni to develop the molecular characterization of cooking oil, because that's what they were gonna put feed into these biofuel refineries. But there's not enough cooking oil in Italy now because they've converted three out of the six, so they have to produce vegetable oil from seeds. So Eni has now become a farming company because they've set up cooperatives in six countries in Africa to produce a hundred and fifty thousand tons per year of seed oil that they then export into Italy to process in these refineries. So they've extended their supply chain now into farming. You look at Dow, plastic circularity, that we don't talk a lot about, but the fact is that part of the dual challenge is circularity, plastic circularity. So Dow is now setting up and committing to recycle three million tons of waste to feed into their ethylene crackers. That means changing their supply chains, because in a way, either they do it or they have to get a third party to become garbage collectors, plastic collectors, to aggregate all that plastic, to feed it into these assets. And by the way, they've also announced that they're gonna build two new ethylene crackers, one in Carolina and one in South Texas, and they are gonna power them with small nuclear reactors, SMRs. So, so this is how our customers' businesses are changing. TenneT, they're now gonna be producing twenty-one gigawatts of renewable electricity from the North Sea. The problem is, the wind is blowing at night over there as well, and the lights are off at night. So what do they do with all that electricity? They wanna convert it into hydrogen and ammonia to store it and convert it back to electricity when the demand picks up. But what this creates is also sort of new pathways for sustainability, but also for these businesses. So ten years ago, we would talk about the four pathways on the left: energy efficiency, emissions management, water conservation, waste reduction. Electrification has become a thing of the last really five years, but now we're talking about biofuels, carbon capture and sequestration, hydrogen, renewable energy, and then eventually, how do we—in which ways do we use the CO2 that we've stored to create new materials, whether it's methanol, whether it is integrated into concrete for paving roads, plastic circularity. All this is opportunity, and what it's creating is a convergence of capabilities in these industries, where the capabilities that existed in the refining or oil industry are now becoming relevant for the utilities industry. The capabilities in the utilities industry to manage electrical grids are becoming very relevant for oil and gas Chemicals companies as well, because you have companies that wanna electrify their midstream oil and gas production assets in the Permian, and therefore, they have an electrical network that they wanna manage and maintain and operate, and they're looking at DGM's capabilities. Or you have, like I said, TenneT, that wants to convert an electron into a molecule and back into an electron. So that molecule is created through electrolyzers. That is a Chemicals process that is found and in refining, and AspenTech is able to model from taking out of the air and creating an electron to converting that electron into a molecule and back into an electron. Aspen Technology can model that whole process, and this is what makes us uniquely positioned. Then, of course, it's about technology and driving greater digitalization to drive safety, reliability, efficiency. This is where the value is created to drive operational excellence, so it's about performance, resiliency, and sustainability. At Optimize, we presented this slide around Optimize Global Conference back in May, and we have logos of companies. But sometimes it's hard to tell what each of those companies do. So we decided to show you really what are the industries that AspenTech is being pulled into by customers that know about AspenTech, they're users, they're Chemicals engineers, and now we're into electrical batteries, research and modeling, biofuels production, carbon capture, plastics recycling, renewable energy, sustainable materials. This is a new category of companies and customers that didn't exist before in AspenTech, which is what's driving the use of AspenTech and greater use of our engineering software, and eventually greater use of manufacturing and the rest of our technologies. Now, AspenTech has had a history of not only organically developed technology, but a lot of the companies that we have acquired have been first-of-a-kind capabilities. And that innovation, that creativity, is what's driven this company in the past and going forward. So a few years ago, we focused on artificial intelligence, and I love the interview of Julie Biel from Kayne Anderson Rudnick, where she said: "Look, this hype, this AI hype is interesting, but AspenTech has been doing AI for decades already." And it is true. Heiko Claussen will tell you, give you examples of how this happened, as well as Vikas. But we also felt we needed to have our own approach to delivering artificial intelligence capabilities into asset-intensive industries, and that's the creation of industrial artificial intelligence. Industrial AI, which is taking the machine learning algorithms, those algorithms across the AI spectrum, but also some of these new capabilities, large language models, and combining them with the capabilities in our products, the first principles, the domain expertise, so that the physics and the chemistry would provide the rules of the road, the guardrails for the safe delivery of artificial intelligence into very complex and dangerous assets to operate, so industrial AI was born, and it's about enhancing the capabilities of our products by improving the accuracy and predictability of our products, or by automating repetitive tasks that users of our products have to perform, or by now helping guide those users in the modeling or decision-making as our solutions provide generate the results that then they have to evaluate. It's a combination of capabilities that is very unique, leverages our strengths around first principles of engineering to deliver greater value for our customers. And ultimately, that value, again, is financial. It's either sustainability or it's about resiliency and reliability in operations. It's about the agility, the guidance, and the automation. All of this is because we're driving to our unique vision, which is the Self-Optimizing Asset. The fact is that a lot of AspenTech's innovation over the last forty years has been driving towards this goal. If you look at multivariable process control, introduced in the late 1990s, it was about closing the loop in the control of very complex process units, and taking the operator out of the operation of those units. It's not only created huge value, but it's made these refiners and Chemicals plants a lot safer to operate because the control technology is in charge of driving operations. So we've been at this for many years, but now what's happened in the last five, 10 years is a convergence of technologies and capabilities. It's cloud, it's edge computing, it's 5G, it's artificial intelligence, it's virtual reality. All these capabilities accelerate our journey to our Self-Optimizing Asset, assets that are self-learning, they're monitoring the capabilities, what's going on in these assets. And from that, they're understanding the process conditions, and it could inform the adaptation, then it's sending new set points into that process to change the operations of that. That's the self-adapting capability. And then self-sustaining is about predicting process degradation, it's about predicting equipment failure. None of that is gonna be done automatically, it probably require the intervention of a human, but it's about greater and greater automation and digitalization of these assets to create value. That value, again, is across the bottom, profitability, safety, sustainability, and reliability. That's a portion of the $59 billion that we've talked about. Now, all of this is, again, driven by our people. So we've over the last two years been putting greater emphasis on not only the acquisition, but the retention of talent, development of the critical skills that are required in the company to continue to be the industrial software leader. It's also about the organizational setup, the agility that is required to be the leader in the software space. If you ask me, one of the greatest, one of the best traits or characteristics that a software company needs to have is agility, because the rapid change in technology and acceleration of technology development and disruption requires incredibly agile organizations that are able to pivot as new capabilities emerge, or we need to be the ones that are disrupting the market, and eventually driving the employee engagement, the enablement, and everything that comes with having a world-class workforce, organization, and individual capabilities. So this is fundamental to now talking about how we're gonna create value going forward. So first of all, I'm convinced, and, that this company will be a double-digit grower now that we have moved out of the integration and transformation from the transaction with Emerson. You know, the last two years, we've grown 12%, 10% if you exclude the Russia contribution from those growth rates. But more importantly, we've now built a platform, and we've set up the organization to really then focus on taking and capturing the opportunity that is in front of us. So, how are we gonna drive double-digit ACV growth? We have large industrial markets with durable tailwinds. We have industries with a very large installed capacity. So the important thing to understand is that we grow the company by driving technology into existing assets. Certainly, when new assets are built and designed and built, our software is also used for that. The total addressable market is about an existing installed base. It's about the wide space that exists for each of our suites in the, in those assets, and is really the alignment of the long-term macro trends that will drive greater use of our technology. It's about driving greater innovation, and it's what we're doing to the market, and then the transformative innovation across the full asset lifecycle. All of this then coupled with a very rigorous and disciplined go-to-market motion to drive product usage and adoption, and we'll talk about this in a minute. Why are we so convinced that we can grow double-digit growth? This is about these secular trends that we see are in front of us or really as tailwinds for us. Digitalization is about driving competitive advantage, and I can tell you, our customers truly believe that through their creative use of our technology, they create competitive advantage in the marketplace. It's about also now addressing labor shortages and a retiring workforce. It's about leveraging artificial intelligence to create greater value. And sustainability is about driving a reduction in emissions, it's about molecules and electrons, and really meeting the dual challenge. Global electrification is an incredible opportunity, it's about expansion of the grid, it's about complexity of the grid that is created by renewable energy, that is created by distributed energy resource systems, but also is about resiliency. And resiliency is cybersecurity-... Outage management, because the storms are creating greater disruption of the grid, and therefore, the capabilities to not only predict when there's gonna be potentially an outage, but to recover from those outages faster. And then it's the energy transition and all the opportunities that it creates around new energy sources, a scaling of those new energy sources, whether it's hydrogen, whether it's biofuels or other types of sources as well, such as SMRs, so small modular nuclear reactors as well. These are the four secular trends that we believe will drive increasing spend on our capabilities across all five suites of technology. So let's talk about the total addressable market. So today, we believe that the heritage AspenTech business, our MSC, Engineering, and APM suites, have about a TAM of about $7 billion. The Digital Grid Management suite, the capabilities that we have today represent about a $2 billion TAM on a global basis. This is pure software TAM. If you do research on the TAM for DGM, it's probably double that TAM, but it includes services. Therefore, we've excluded services, implementation services, out of this TAM, and then SSE is about another $2 billion. Now, the TAM is not static. The TAM grows by introducing innovation, and AspenTech has done organic innovation or inorganic throughout the years that expands the TAM. Industry growth, the energy industry grows about 1% per year. The chemicals industry is GDP, whether it's 2-3% per year, and now the utilities industry is expanding at 5-6% per year. So this TAM will expand with industry growth. Price escalation, 2-3% in our contracts. Product upgrades, and this is important because sometimes we decide to introduce a new version of a product that is already in use in a customer, that that delivers greater value because of the optimization technology that exists in that product, and therefore, we can introduce that product at a higher price point, and that creates an uplift in the TAM that's available to AspenTech by upgrading all these customers to that new technology. So that's a way not to create new TAM, but to upgrade the consumed TAM, and therefore create more opportunity for AspenTech. And then, of course, M&A, and we've done that. In my in my tenure as CEO, we've done 10 acquisitions, and that's expanded the TAM of our heritage AspenTech suite. Now, we also estimate that in adjacencies to the DGM and SSE suite, there's another $4 billion for the DGM suite of TAM as we think about M&A around the DGM suite to expand the footprint of our capabilities in the utility space, and another $500 million of TAM as we think about moving into new areas such as CCS, geothermal, lithium exploration and production, and so on. So these are estimates that we have in place, and that we know who are the companies and in what spaces they are, that are adjacent to our solution. So we see a big M&A opportunity for AspenTech around DGM especially, but also any talking technology that is developed in the heritage AspenTech space, we can go after that, put it into our suite, and it's immediately available to all of our customers. The diversification of the last two years has moved us from a company of about $600 million to over $900 million of ACV, and you can see how the company's become more diversified from an end market standpoint, but also from a suite. Today, chemicals and refining, about 23% of total ACV, upstream and midstream, 20%, EPCs, 19%, and then power and utilities and other. The important thing is the acceleration in growth that we see out of DGM and certainly the contribution of SSE, and then how the suites have diversified as well. When you think of the engineering suite, being 45% of our ACV, and a business that's accelerated from mid-single digit to high single digit growth in the last year and a half, two years, that represents a significant uplift in our ability to grow the company going forward. Now, a lot of you are always asking me about trying to understand the drivers of CapEx and OpEx by industry and by suite. We've tried to represent those drivers for you. This information will be available to you, so I'm not gonna go into the details of the puts and takes that happen between a CapEx and OpEx, but, and the drivers, the KPIs that we normally pay attention to, to understand how growth will happen going forward. But this is an attempt by us to help you gain clarity on the drivers. Now, look, the potential for AspenTech. This is a three- to five-year ACV growth rate, assuming healthy industry drivers, and this is the range of growth that we see for our engineering suite, 8-10%, MSC 10-12%, APM with a new strategy and greater focus, growing about 15% per year. DGM has grown 40% the last two years, but over the next three to five years, we can see, the growth rate of that suite, sort of moderating around 25%, and then SSE, 8-10%. So what, what's required to go from 9-10% to 12%? Well, the chemicals industry and, and the downturn that it is in today, is only contributing a fraction of what it normally contributes, and we believe that if it gets back to normal growth, it'll be another point, a point and a half of growth contribution. We believe that if we bring the attrition rate down from the 4.5 points that we're guiding to in fiscal 2025, down to 3-4, that'll be another point to point and a half of growth contribution. If you add that, those two factors, it's 2 to 3 points, and if you add that to 9 or 10, that's how you get to that 12 to 13% growth rate for the business, which we believe is the adequate growth rate on their healthy macro environment that AspenTech can achieve, going forward. Now, another important factor that's sort of coming to focus is with DGM and expecting that DGM will benefit from consistent CapEx spend over the next five to ten years, we believe that the trough growth rate at the bottom of the cycle for Aspen Technology will now be mid-single digit. That's 7 to 8%, in twenty sixteen, and then in twenty twenty-one, we grew at 5.41 and 5.3, sort of mid-single digit. We believe with DGM now and the more consistent CapEx spend and expansion of digitalization in that industry, that our trough at the bottom of the cycle growth rate will be more elevated at 7-8% going forward. That means this growth rate for each of the suites, okay? SSE at 0.5-1 point, our DGM suite, 2.5-3.5 points, and the heritage AspenTech suite, anywhere between 4.5 and 7.5. This produces a 7.5-12% growth range for the business going forward. Now, that growth is certainly driven by constant motion around innovation to drive not only innovation, our core offerings, but also drive an increase in value, that will drive increase in value, moving from point solutions to integrated products to solutions, which will allows us to then capture greater value from the value that these solutions create. The introduction and greater introduction of industrial AI, where AspenTech, where Heiko will talk to you about at least 150 different use cases that we're evaluating for the introduction of AI and sustainability as a driver of use of our technology, all of that in the context of the Self-Optimizing Asset. In 2024, we spent $191 million in R&D. That's a little elevated as a percentage of ACV, but as we grow the ACV, we expect our growth rate, our spend rate for R&D to come down somewhere between 13 and 15%. How do we drive usage of our products and solutions? Look, it's about an engagement process that we call usage and product adoption. It's about engaging with users so that they spend more time in our products, and therefore they consume more tokens, but it's also getting users to use more of our products. And this is the beauty of the suites. Our suites have an incredible number of products and capabilities that is easy for customers to migrate from product to product. It's about a mile deep and a mile wide, and then it's about an enterprise expansion from side to side and at the corporate level, so that more and more tokens are consumed. This is how we think about our go-to-market, how we organize our solution consultants and our sales account managers. Of course, the term token model drives eliminates tremendous friction in the migration from product to product by our customers. Now we have a customer success organization that drives greater engagement, is much more focused on alerting in case the usage of our products is decreasing, or also alerting in case they identify new opportunities for our customers to use other products. We've been investing in this customer success organization over the last two, three years. These are a couple of examples of how we drive usage, and if you look at on the left-hand side, a leading integrated energy company growing their spend with AspenTech over the last seven years by 91% to $14 million annually. This is 2X growth in spend by exactly following that motion. More products, more users across the enterprise. Many refineries, many chemical plants. On the right, you have a utility company that in that same period drove their spend with OSI, now AspenTech, by 1,200%, by implementing not only the SCADA system, but the applications on top of the SCADA system. These are two other examples: global integrated energy company equally growing their spend by more than 50% over the last seven years, and another utility firm growing their spend over 300%. So great opportunity to accelerate the spend rate of utility customers as they are accelerating their digitalization. Refineries and chemical companies have been on a digital journey for 20, 30 years, but this is new to the utility industry, and therefore, there's a greater acceleration because of demand for electricity and the fear they have of not being ready to handle the demand and the complexity that they're facing. So with that, look, there's certainly the relationship with Emerson, and that has three different aspects to it. The commercial model, and it's a reselling motion where we're leveraging Emerson's end markets, leveraging geographies as well, but also types of deals that Emerson is very good at to drive more AspenTech product into the market. We're also working collaboratively with Emerson for them to integrate our solutions into their automation systems, and eventually, also the co-innovation that can happen between the two companies to achieve our common vision and... Well, not common necessarily, but a very similar vision, one of Self-Optimizing Asset and Boundless Automation. There's a very strong Venn diagram between the two visions going forward, and that's happening as well, discussions around co-innovation. Look, on margins, we've demonstrated in AspenTech that we can run this company very efficiently and productively, and our goal is to drive this company to 45%-47% non-GAAP operating margins. Certainly, the DGM business and the services component is a drag on that profitability today, and therefore, we're setting up an implementation services partner ecosystem so that they do a lot more of the implementation going forward. But it's also a business that is not yet at scale, and we expect that as we scale the DGM and SSE businesses, there'll be greater profitability that flows into that business. Our own commercial model, the token model, is very scalable, frictionless, and the incremental dollar of ACV is at a very low cost for AspenTech. Same salesperson, same solution consultant that can be deployed into a customer to drive greater use of our products. Of course, acceleration of innovation, whether it's organic and inorganic, and the alignment with our customers, around value. And then it's how, how do we run the company internally? And those are the efficiencies and the productivity, and that's one of my, my main focuses as, as CEO. Are we operating at the right productivity level at, at the company level, but then by each of the functions? This is something that we demonstrated over the last 10 years we can do. So we believe there's significant opportunity and leverage in the organization structure to drive productivity going forward. So I want to introduce to you the target operating model that we've set for ourselves going forward, and it is to your left, the target values. And you have the FY 2024 values and where we ended up on ACV margin and free cash flow margin. You have the fiscal 2025 guide for those same metrics, and then our targets. As you can see, we're already making good progress towards the target on a free cash flow margin. If you look at fiscal 2025 and the implied free cash flow as a result of the Russia restructuring, that would be a higher number, but we believe we can be in that range of profitability and free cash flow generation going forward, and by that we mean in the next three to five years. This is a little lower than heritage AspenTech, where we were at 47-50, where we're at 41-44 for free cash flow. But we also recognize that the DGM business requires an acceleration of implementations, and therefore, we're gonna keep a higher percentage of services revenue as a percentage of ACV. That puts a little bit of pressure on the margin, and but as this business scales, we'll my hope is that we'll get some of that benefit back as well. This is our target operating model going forward, and this is what we're executing against. Of course, disciplined capital allocation, share repurchases, you know, the organic innovation that happens internally, the successful M&A, it's very disciplined, certainly, assets that create that have a lot of synergies to our strengths, asset-intensive industries, industries where optimization, reliability, safety, sustainability create a lot of value, but also where there's great value opportunity for AspenTech, and then share repurchases. Over the last 10 years, we've repurchased over $2 billion of our own equity, and we have an authorization in place this year. You know, we have a model for M&A, very specific criteria. Anything that we acquire, we want it to be accretive to best-in-class profitability and double-digit growth. It certainly has to be relevant to our strengths as a company, optimization, adjacencies in industries that make sense for AspenTech, and the very disciplined process that we use to M&A. We've demonstrated that we can integrate two companies, completely transform them in two years, and drive value creation as part of that process. So this is one of the things that I'm sort of most proud of, of the last two years, in that prior to the Emerson transaction, we've never done anything of the size of DGM or SSE, and we had the opportunity to do that simultaneously for two businesses. It's normally what private equity does behind the curtain. We did it in the public space, and we had to report some of the zigzagging, but that's one of the-... One of the characteristics of being a public company, we have to tell you what's going on. This is just what's happened in the last 10 years, and how the company, through our M&A strategy, has continued to evolve and grow. And today being the company of scale and size that we are. And then how we think about M&A, which is tokens into core suites, adjacencies, product adjacencies. If you look at our acquisition of GDOT, which is a multi-unit optimization, that's a product adjacency or market adjacencies is DGM and SSE. Those are market adjacencies for AspenTech. So to close this session, market leader in mission-critical software, diversified industry exposure, but more importantly, look, the upstream industry is showing tremendous discipline on how they spend money, which I think will create a more consistent spend environment going forward. The EPC industry has restructured itself in the last 10 years and now is more diversified, taking advantage of CapEx around sustainability, which I think will make that industry more resilient going forward for AspenTech, but also then utilities, chemicals, and so on. Uniquely positioned to address the dual challenge, huge value creation for customers, a world-class customer base that is expanding, breadth and depth of our portfolio driven by innovation and the expertise of our people, a strong and diverse talent, and frankly, AspenTech is an incredibly diverse company, very global in 45 countries with 60 offices. Multiple ACV growth pathways, hopefully, that's clear to you after this, will drive to best-in-class profitability and free cash flow. And now we have the investment capacity, a greater investment capacity, but also a partner in Emerson to leverage their own balance sheet and very disciplined capital allocation. So with that, we're gonna see a video, and next will come Vikas Dole to talk to you about our products and how we drive growth with our products. Thank you. Our customers depend on AspenTech for the critical software to design, operate, and maintain their assets, from equipment in a process unit to some of the largest facilities and electrical grids in the world. With an expanded portfolio of leading software technology, we are advancing the performance, resiliency, and sustainability of asset-intensive industries. With the combined power of this unique portfolio, we are leading the way to a more sustainable future. End-to-end solutions, driving mission-critical decisions, harnessing the power of industrial AI. That's what makes AspenTech the trusted partner for operational excellence. All right, thank you. We'll now look into the strategy to grow our ACV, looking at it from products and innovation point of view, trusted to solve. Hello, my name is Vikas Dole. I've been with AspenTech for 27 plus years. Started my career in technology development, then expanding into consulting services, but a large part of my career has been in product management, and more recently, I've taken on responsibility to manage portfolio-wide, products from product management point of view. Excellent journey so far, and looking forward to exciting times ahead at AspenTech. Antonio talked about our product leadership, and we've set innovation, you know, industry-first innovations that have transformed the industry practice, that have left legacy in the way people do design, people do operations, people do maintenance, and as a result of that, we are an industry standard today. Number two, we have some core unique capabilities in modeling and optimization that differentiate us from the competition. Just as one measure, we have thirty-four thousand chemical compounds in our modeling library, and this is the largest database ever. It's not just the individual behavior of those compounds, but how they interact with each other. How do they interact with the equipment? Generations of plants have been designed and operated with our modeling technology. That creates really opportunity for us to be number one and stay number one in these areas. There are a lot of mission-critical operations, advanced process control, self-adaptive. There are eight thousand different applications out there, closed loop, real-time, driving optimization, day in, day out, and that also differentiates us. So all this is leading to our market leadership as a foundation. Over the next hour and quarter, we'll have multiple speakers talk about our core strategy of driving ACV growth, and it has got two main prongs. One is our strategy of product usage and adoption. Antonio briefly touched on that. I'll dive deeper into it. At the heart of it is our term token model, and then our way of engaging with customers in terms of enabling them, in terms of driving customer value, and so on, and we'll dig into that, and secondly, we'll cover various facets of innovation and how that is differentiating us from the competition. How is that accelerating value creation for our customers, so let's start with the term token model. Some of you may be new to this. Our token-based engagement with customers and contracts is based on very well-defined number of tokens that we provide to our customers. Each one of the products in a suite has a unique token count, and that provides enormous flexibility for our customers to use any of the products within the suite, as well as gets access to new innovations that are coming through. So from a customer point of view, it's simpler relationship. Number two, much more ability to go after new innovations and use them as they feel fit. But also, as the trends change and their projects change, they can move from one vertical to another with complete flexibility. From AspenTech point of view, it provides a progressive way to expand our usage in the customer organizations, scale our new offerings very quickly. So together, when you bring the customer aspect and the AspenTech aspect together, simplicity of customer experience, access to innovation, and resilience in spend through the token model. So it provides tremendous opportunity for both of us to really work together and have a win-win situation. Now, the way we work with our customers has been improved and enhanced over the years, and we call it largely as product usage and adoption methodology. And it actually starts with the universities. We have more than 1,300 universities worldwide, with close to 130,000 students who are using our software, core products like HYSYS and Aspen Plus. These are the workhorses for process engineering. It's like Microsoft Office for process engineering across 80 different countries. And this really is the starting point for our users to be exposed to AspenTech's technology, be familiar with it, and develop core competencies. That becomes the starting point in terms of awareness and competency, and as they then join the workforce, we are engaging with our customers to identify what are the use cases they can use our software with, how can they enhance those capabilities, what are the most appropriate use cases for their business, so that they can then further develop the expertise. And then once they identify which modules to focus on, we then have a systematic competency development program to raise that expertise level to the next point. So we create lifelong engagement with our customers and lifelong engagement with the users, as we migrate through this. As you go through this, and you'll see later on from a customer point of view, you gain a lot more value, you get much broader adoption, and you start to get a lot more adoption of the technology. Now, competency development is one facet, but our customer success management makes sure that organizationally, our customers are making best use of the technology in creating value and addressing their business challenges. We have a focus team, cross-functional team, that is focusing on accelerating new version adoption. Antonio talked about $191 million worth of spend in FY 2024. Every new release has tremendous number of new capabilities. So it's a win-win for us and customers. If they adopt the latest version, they take advantage of the capabilities, and it's great for us because that drives greater value and ACV growth for us, for our business. And then we have partner network, extensive partner network to really accelerate adoption. So all that together is our systematic approach to product usage and adoption that has been continuously improved over the years, and that facilitates ACV growth in our customer organizations. Now, from a customer viewpoint, the journey is really interesting. It starts with the point products, and it largely falls into these three buckets. Firstly, they get exposed to our market-leading products across the portfolio. Secondly, through those products, they discover adjacent synergies, integration workflows, how their core community could work together and collaborate with other communities. That drives intensity of usage growth, as well as greater number of users using our technology. And that then results in their vision to really embrace more comprehensive solutions to address holistic challenges in their across the life cycle. I'll give a very specific example. With process simulation, we have two flagship products, HYSYS and Aspen Plus. They are, if you like, the fundamental platforms or environments. A customer can start using HYSYS and Aspen Plus, start to model the process so they can assess the performance. Within the environment itself, we have very easy dashboard that provides them access to quick analysis, economic analysis, energy analysis, equipment analysis, without being expert in any of those disciplines. It's a patented, activated workflow that we developed within our simulation environment, and that drives quick usage, but also token intensity growth per user. Behind the scenes is creating data and models that adjacent disciplines can take advantage of, so it starts to drive collaboration within the organization, evolving into integrated products workflow, and then the customer realizes that the design models can then be reused in operations because they encapsulate deeper understanding of how the asset behaves, and that creates then a life cycle solution from early design to front-end design to operations. And typically, there's an uplift of 10X as you move from point products into solution across our portfolio, so interesting example that I would like to share. As you drive past a chemical company or a refining company, you'll see these long towers. They are distillation columns. So just in U.S. alone, there are 40,000 distillation columns just in the chemical industry, so if you look at worldwide, there are hundreds of thousands of distillation columns. One of our core differentiation in modeling is our ability to accurately model these distillation towers. Why? Because they bring in feedstocks, and they separate feedstocks into products. So the product quality is highly dependent into parts per million, parts per billion purity, based on the accuracy of the models. There are hundreds of internals inside the tower, and depending on which internals you choose, you can get completely different performance. The energy contribution of these towers is significant portion of overall energy that is required for the process. So it's an important element. So it's one of the reasons why we're a leader in simulation modeling, because we focused on these things right from the birth of the company. Over the last few years, in 2017, we introduced a visualization capability of what goes on inside the tower with vapor, liquid, and all the different reactions. It was very interesting for our customers because that is critical to their improvement in performance of the process. As a result of that, because we placed this new capability as an integral part of the day-to-day distillation column modeling, the usage just continued to grow by itself. Because they discovered this new capability, we provided in-context guidance and help as they progressed in the use of capability, and then we also provided training modules that supported that. Over a period of five years, we grew the usage as well as number of users sixfold. This is one of those examples that really creates a self-sustaining growth model, facilitated by the workflow inside the software, but also complemented by competency development program. Let's move into innovation. Innovation really starts with core product innovations, focusing on then integration, as I described to you, and facilitating the cross product integration, cross-suite integration into more enhanced solutions delivering value. Then various types of applications, whether those industry applications or sustainability applications, how can you create and replicate that success from solutions into overall workflows? Then how are we embedding AI as a part of our industrial AI strategy? Heiko Claussen will talk more about that. How is it all evolving into our vision of Self-Optimizing Assets? Let's start with the suites. We invest $191 million or close to that every year. So you can see core innovations that are continuing to differentiate us from the competition. If we don't invest here, we will not be able to be number one in years from now. So we continue to invest on core modeling optimization, AI-driven industrial AI solutions, as well as collaborative integration solutions, and responding to new trends like sustainability offerings and new sustainability pathways. That's like a common thread across the board. Now, in addition to that, we also realize that modeling and optimization heavily relies on the data that you feed into the system. And then our industry-proven data fabric solution is really geared to bring that data together, aggregate it, and then make it contextualized so that various products can take advantage of that, not just within the AspenTech portfolio, but also interacting with third parties' software products. So data is gonna be a key enabler for our AI strategy as well, and this is a very important and critical investment we have made that will become an important piece moving forward in driving growth for AspenTech. Secondly, solutions. As you then develop the integrated solutions at the suite level, this is the third box I showed you, you are now ready to respond to many different industry solutions, which would be a combination of our suite-level solutions. So let's take oil and gas. We can serve an oil and gas requirement right from early conceptual design, front-end design. We can leverage those models into operations, into maintenance, and then also have capabilities below the surface in addition to optimizing the assets above the surface. So multitude of suites work together in conjunction, in symphony, to serve, the industrial challenges, like, oil and gas or chemicals, challenge. Similarly, for sustainability, carbon capture utilization storage, there's an entire asset life cycle, right from early concept to design to operations, where our multiple suites will work together in conjunction, but also above the surface and below the surface in terms of CO2 storage. So these create multiplier effect of our solutions and creates greater usage and ACV growth for us. I would like to just, provide an example of, three of our suites, and you'll see a lot more detail from our product leaders who will come and present these. The first one is, engineering suite, and I talked about the activated workflow. It's really all about... Oops. It's really all about integration around the simulation area. So we start with a conceptual design, front-end design, and moving into operations. With digital grid management, our customers start with the capability of the Monarch OSI SCADA platform, and then they add capabilities in operations and management from generation, transmission to distribution. And with our Production Optimization solution, customers either start from the planning end or advanced process control end, and then they gradually see the synergy across the solution to maximize and take advantage of from a Production Optimization perspective. So these are all solution journeys that typically create ten X in terms of ACV from our customers. It's not just the solutions by themselves alone, but the synergy across them. So when we have a performance engineering solution, and the models that are generated from that solution, they reflect more accurately the behavior of the asset and the performance of the asset, which are extremely valuable from an operations point of view. So through its integration with manufacturing and supply chain, our planning models improve their accuracy. Our dynamic optimization improves its accuracy. Our advanced process control starts off with the seed models from performance engineering. So both are synergistic with each other and drive greater accuracy as well as margin improvement for our customers. With our Asset Performance Management, we can predict potential failure of equipment or a process thirty, sixty days in advance. That's a valuable information from manufacturing and supply chain point of view, because you can replan, you can reschedule, you can reoptimize based on the new data so that our assets, our customers are seeing least impact on profitability and margin improvement, and see a lot more resiliency and uptime. So we are starting to see also a lot of synergy through the integration that has been established across the suites, and creates a much bigger differentiation against the competition. Antonio talked about sustainability. These are, you know, new trends, very important for our customers in meeting or addressing the dual challenge. On one hand, addressing the growth opportunities, on the other hand, really driving an accelerated journey to net zero. The ones on the left, as Antonio said, are much more mature: energy efficiency, emissions management, electrification. Our customers have been doing this over the years, but tremendous new interest from our customers in utilizing that, because you can save up to 30% on your journey towards net zero by driving efficiency improvement. This improves margin, it creates much more efficient plants, but also reduces emissions. Our customers are investing big time into capital to address the remaining journey towards net zero, whether that's carbon capture utilization storage, hydrogen economy, and so on. We are ahead of the game there because we have leadership in engineering that accurately models these assets. More importantly, we are the only company that looks at economics from CapEx and OpEx point of view, because these are billion-dollar investments, and if you're not careful, you can spend a lot of money and not get enough returns that you should be getting. And then on emerging areas like plastic circularity, we are uniquely positioned because we are the company who have unique capabilities to model polymer processes. That has started from the birth of the company, and as a result of that, many research institutes, as well as research groups within customer organizations, are using our solution. So we are seeing, over the last few years, several examples of success. In energy efficiency, we literally have hundreds of examples over the years. And as I said before, this is the first step our customers take in squeezing as much as possible with existing assets before they embark on the journey of decarbonization and CapEx investment. And you can see examples of success there, Braskem Idesa. This was an example of where Emerson and AspenTech technologies were combined, implemented together from automation and sensors and instrumentation to asset optimization, saving 200,000 tons per year of CO2, and also improving margin by $15 million. With Tubarão, 20% improvement in energy efficiency, less than 1 year payback. Then moving into carbon capture and storage, this is huge capital investment, and PTT has been able to save 20% in CapEx and OpEx. This was an Optimize conference paper this year as a result of our modeling and optimization capabilities. Then for hydrogen projects, our customers typically spend at least $5-10 billion or more, and there's a huge level of uncertainty when you're investing on these projects. Our feasibility analysis and optimization capability with Fidelis was used, and the customer has been able to save $500 million on this project. The other beauty is, even though the project is in the pre-feasibility conceptual design stage, customers are still using our suites of products, because they want to optimize and design these projects, even though maybe a fraction of them will move towards operations. As they move towards operations, the baton gets passed on from performance engineering to manufacturing and supply chain into Asset Performance Management. You start to see symphony of different suites working together to serve our customers end to end. This is an overview of the sustainability pathway for carbon capture utilization storage. Huge amount of capital is being invested. A lot of uncertainty in these areas, but our customers want to know how they can optimize this, and they start their journey with performance engineering, optimizing the concept and design. The same models are then utilized for driving operational excellence through advanced process control, even before the asset starts to operate, because you have digital model of the asset. You can then create operator training simulator with the same models because even before the plant is commissioned, because you want to get ready, so all of those things are possible, increasing speed of innovation, speed of deployment, as well as reduction in uncertainty of the overall capital project, and then our digital grid management solution can be used to monitor high-pressure CO2 pipelines. This is all above the surface optimization, and you saw the PTT example of 20% saving. Equivalent to that, there's a subsurface optimization as well in terms of selecting the right reservoir injection strategy for the CO2, optimizing the storage operation, and then monitoring it for hundreds of years, so that there's no potential upset or leakage of CO2. So all of those are complementary, and increasingly, we are integrating these capabilities to serve our customers to really maximize value creation. Now, there's a lot of uncertainty, a lot of technologies that are coming together, rapidly evolving, different regulations in different parts of the world, different incentives in different parts of the world, and we realize that not one single company can really have all the answers to address the dual challenge. So three years ago, we embarked on a journey to really establish advisory groups of our customers so that we intimately understood regional requirements, as well as industry requirements, and that we were solving real-life problems with them. The advisory groups is not just an armchair arrangement. We are working with them, rolling up the sleeves, and actually implementing the solutions as we are developing on their sites. So it's a co-innovation engagement. And as a result of that, there are a number of new implementations, new technologies were developed, together with the regional sustainability advisories with our leading customers. As part of that arrangement, we also entered into deeper co-innovation and collaboration engagements with our leading customers. You can see two of those examples with OMV, co-innovation in biofuels. OMV's challenge was to make sure that they are compliant with different countries' constraints on biofuels, while simultaneously maximizing profitability and performance through our Production Optimization suite. And they have presented at our Optimize Conference recently. With Saudi Aramco, we licensed their technology that was developed in their R&D group, for optimization of configuration of carbon capture, and utilization schemes. We now brought that technology, within our Production Optimization suite to provide a much more holistic strategic planning solution for our customers. And the key reason is our customers' life is getting complicated because a lot more new options in strategic planning that are coming together, and we're seeing significant interest from our customers in this area. We already have launched a limited release, a capability in this area, and we continue to work with our customers to broaden and improve the capability. So in summary, we have really two prongs of our strategy: usage and product adoption and systematic methodology to accelerate the ACV growth for our customers, and then innovation, core innovations, solution innovations, and also sustainability and industry innovations. AI and industrial AI is an important pillar of our strategy, and I would like to invite Heiko Claussen, Co-CTO, to talk more about that. Thank you, Vikas. Thank you, Heiko. All right, so my name is Heiko Claussen. I'm driving our AI innovation here at AspenTech, and I've working on AI about 18 years together with autonomous system top topics, and yeah, it's now great to talk a little bit about my passion, which certainly is AI, and give you a little bit look under the hood here. I've been with AspenTech about three and a half years now, and it's been a great journey so far. So when talking about artificial intelligence, it's good to start with an introduction on what we really mean here, and here the technology that allows software to perform tasks that normally require human intelligence. So this is how we define it. But AspenTech is not just using AI in a generic way. It's very important here as a takeaway. We're a leader in the domain, have more than 40 years of experience, and we're combining this domain expertise with the AI domain knowledge and the data to create what we call industrial AI. This differentiates through guardrails, through robustness, and to trusted results. What do I mean with that? Guardrails means that we use our models' experience to make sure that the results of our models are always reliable and safe. In the AI terms, where it's common to enforce constraints, is you include them in a cost function. It's in the end, and you use it only for training. We actually change the algorithms itself to make sure that the AI cannot predict something that violates these constraints. Robustness means for us we use the right tool for the right task, and for example, you need a specific algorithm if you wanna run a real-time application, or we have to make sure that we can extrapolate the results in a reliable way. For example, if a disruption like COVID, you don't wanna run your operation anymore at the same point, you have to make sure, even though you don't have data of your next set point, that you can extrapolate to those operations, and trusted means that we always keep the operator in control. We try not to have black box model. Interpretable AI is key here... Now, talking about bringing these data insights together with domain expertise and the combination of our forty years of expert-- of domain knowledge here, really creates three differentiators that I want to point out. On the one side, we are much more data efficient because we can use our domain knowledge with simulations to enable our models. To make this a little bit more clear, I would like to give an example from another domain. In the past, in self-driving cars, companies believed that they just need to record a lot of data and then, you know, train the system by giving directions: What is a road? What is a person? What is a tree? This doesn't scale. First of all, it's a lot of effort to to segment such a dataset. On the other side, you're never going to record all the situations that you have to be prepared for. So for complex AI tasks, like these self-driving cars or in our space, these large assets, it is essential to have the domain expertise, the simulations, to bootstrap the models. Second, we do need data. There's always going to be a simulation reality gap between what you actually see in the field and what you can simulate. It's just not possible to simulate everything. But we have, with our Inmation product, the capability to link real-time OT data and sustain the models that we do have in the field, making them a better representation, and therefore, producing better, more accurate results. And last but not least, we're not just providing vanilla AI tools for data scientists or for somebody to create their own capabilities from nothing. We really drive purpose-built industrial AI and seamlessly integrate this into our product offerings, therefore enabling our customers to utilize the state-of-the-art algorithms and technologies to drive greater value for them. Now, AspenTech is not new in this technology journey. We have already used neural networks prior to the 2000s, so we have been using AI for a long, long time, and we actually utilize it throughout our portfolio. So we have in the MSC space, for example, nonlinear models for complex operations that we're enabling through neural networks. In the engineering space, we have our hybrid models, where we combine domain expertise with data to have a better representation. We have, in the subsurface and engineering space, also deep learning-based math models for seismic interpretation, automatic seismic interpretation. In our OSI digital grid management solutions, we have, for example, load forecasting, which we are also doing based on neural networks. The essence, you know, we are accelerating this journey here, combining state-of-the-art algorithms together with our domain capabilities. Now, there's a lot we can do to utilize AI to drive efficiency at our customers. Our strategy focus about three different areas: agility, guidance, and automation. Why is that? There's specific megatrends in out there that basically leverage these powers and these capabilities best. So what I mean with this is, there's a lot of change, VUCA environment, so we are enabling, our customers to, adapt quickly to changes, to unseen scenarios. So this is what we mean by agility, so self-learning type of capabilities. Guidance, so there's a lot of, expertise leaving our organizations on the customer side, as well as, people, being shorter and shorter in their roles. So upleveling an, customer, to, to the new complex scenarios with guidance systems is really key, to bring, best performance and the fastest results to, to their organization. Automation has always been the key in AI, so particularly if we have very large datasets, or if we're talking about nearshoring, we need to drive these efficiencies to make it possible to have these applications in a particular area. These are our focus topics that we're focusing on, on driving the customer value and ACV growth for us. To make this a little bit more concrete, I have now three different examples that I would like to go into more details. Hybrid models. This is in essence, where we combine our domain expertise, our first-principles models, with data to refine them and make them basically fit better what you're observing in the field. Here we have a customer, for example, that changed from a first-principle model to a data-driven model and for a fluid catalytic converter achieved a 10% higher yield. It's a significant improvement that is achieved by closing the simulation reality gap. The new data that is then used to adapt models can also be used to continuously adapt processes when they're changing over time. As Vikas already mentioned, you can utilize these models in different parts of our products. You can use an engineering model. You basically in our MSC suite use data to refine it and then use that improved model in planning to make better decisions. Another example is on the guidance space. Strategic planning for sustainability pathways. What we're doing here is, in this particular example, that we asked the question: well, if you want to convert CO2 into methanol, there are many, many different processes to achieve this goal. And once you have all these options, you know, you can use one of our optimizers to find the best solution for your particular scenario, to accelerate your journey for your environmental goals. But how to get to this superstructure? So here we're utilizing generative AI to explore what are the different possible options, together with an expert into the loop to make sure that, you know, these are trusted results. It just so, so much significantly reduces the effort and accelerates the speed to create this complex scenario and overcomes the blank page problem. It's a really unique way of using, in this case, large language models to accelerate such a sustainability process, right? Last but not least, example around automation. Here, in our subsurface and engineering space, we're talking about very, very large data models, large 3D subsurface models, and historically, these were annotated manually. Now, we use here, in this case, deep learning to automatically infer the rock properties of this large, complex environment. This really helps understand what is the different permeability, where you can basically store CO2, where you could find hydrocarbons, and you can really drive this in a very efficient way, and therefore accelerate the workflows, but also drive accuracy up and repeatability. Because if you have different people working on these workflows, different humans working on these workflows, and everyone has a slightly different interpretation, bringing these results together can result to a lot of problems that you're overcoming with such of an automation process. So again, different angles that AI enables here and also opens the door to new type of applications. Because of this automation, it is possible to use such tool chains in new areas, in smaller settings, in distributed settings, but for continuous monitoring. So these are settings that you find particularly in modern applications like CO2 storage, geothermal. It's very important to open additional markets. As I already mentioned, so there's a significant value that we are driving in all the three different angles: so agility, guidance, and automation. Here, just to point to a couple of customer examples. Solvay, for example, use our Aspen Hybrid Models to increase 36% waste heat recovery. So a huge uptakes, huge value creation for our customer here. BASF, on the other side, uses our Aspen Maestro product to, you know, faster set up DMC3 models and achieve through this a return on investment in less than six months. It's a significant value that we're seeing here through an AI-enabled process, and we're just in the beginning to this, an AI-enabled customer value journey. As Antonio already mentioned, we actually have so many different topics that we're currently evaluating this. As you know, a lot of technology push in the space, a lot of opportunity, project ideas. We have more than 150 different ideas that we are investigating, and that's important to have this awareness and to check all the opportunities that you could leverage in this space. But it's not possible to execute all of these projects. So for us, it's very important that we are following here a very disciplined innovation process. So that we, on the one side, have the awareness of the possibilities, on the other side, de-risk them, and only invest in the best opportunities later stage of our process. We are very disciplined but also customer-centric view here. So we are co-innovating with customers to make sure that we create what matters, that we create the main customer value, rather than being a technology-driven approach, yeah. And we leverage what we call industrial data scientists. What an industrial data scientist basically combines domain expertise with the data science expertise and therefore has a much more efficient way of driving innovation because they know the constraints in the space and can therefore better bootstrap themselves in the innovation and work very closely with the domain experts here. And last but not least, we are really focusing on our vision around agility, guidance, automation, where we see based on our forty years of domain expertise that we are really have an opportunity to maximize value generation. So we see that these are the trends that we can invest in and drive maximum value going forward. So I hope this gives you a little bit of a view on what we're focusing on. We are going with this into a short fifteen minutes break. If you have any questions, please feel free to reach out. I'll be happy to talk to you then. Have a good one! ... We're gonna get started again here. If everyone could just take their seats, please. We're gonna get going again, so if everyone could just please take their seats. Thank you. All right. Okay. And we will- Oops. Thank you all. We'd like to continue the discussion with regard to our ACV growth strategy and our customer value creation journey with a deeper view of three of our suites. The product management leaders will come forward and take you through that, starting with Sonali Singh, who leads Performance Engineering, Sally Jacquemin, who leads our Digital Grid Management IBU, Industry Business Unit, and then Alex Kalafatis, who leads our Manufacturing and Supply Chain. So with that, I'll hand over to Sonali. Thank you. All right. Good afternoon. I'm Sonali Singh. I head up Product Management for the Performance Engineering portfolio. I've been here at AspenTech for about three and a half years. I came in through an acquisition of OptiPlant. So previously, I'm a co-founder, and I was the CEO of OptiPlant. Today, I'm excited to talk to you about the opportunity of the continued growth of the Performance Engineering portfolio. So Performance Engineering is really at the core of our offerings. You heard a lot about the history already from Antonio and from Vikas, and it is well-positioned for continued market leadership and strong durability. So the growth of the suite is through increased usage within our current customer base, and second, through product upsell or product expansion across the asset lifecycle in design and operations. The differentiated capabilities that we offer in modeling and simulation, but coupled with really looking at how to reduce the levelized cost of energy transition projects, carbon capture, blue and green hydrogen, et cetera, that is what's driving up usage within our current customer base. At the same time, our customers are looking at that digital transformation, so they're looking to go from siloed and sequential workflows to concurrent and integrated solutions, and that's where our product expansion into our solutions is driving up usage. The high-velocity sales team we have is very efficiently engaging with new logos emerging in the sustainability space. So that's an additional growth driver. While the token model that you heard of is driving up consumption, and our existing sales force is being able to leverage that to upsell the product expansion into the current customer base. So the foundation of growth is based on three pillars, right? You've heard a lot about us, of AspenTech, and specifically the Performance Engineering portfolio, being a trusted market leader, and that's because of our domain expertise, coupled with proven patented technology. We also continue to innovate. Heiko spent some time explaining hybrid models. Hybrid models has been a key innovation for us in engineering because it's really helping our customers tie data and AI models to the physics-based first principle models, that flow sheet picture you saw, and really being able to drive accuracy and improved operational efficiency. So we continue to invest and innovate around AI... but also around the concept of solutions, the sum of the parts. We're taking our products and really pulling them together to drive concurrency and integration. The trust and innovation here that's leading to our growth is because we are now able to partner with our customers. So, you know, the exciting part is we're not just called in for advice on implementation, on projects or software implementation. We do workshops with the major energy and chemical companies, where we're working with them to collaborate, co-innovate on new emerging processes, and workshop driving their project execution efficiencies. So if we look at the customer journey, and Vikas showed an example of this, specifically in Performance Engineering, the journey starts with those trusted market-leading products, HYSYS or Aspen Plus, right? So that's our point product solution. We're getting a lot of new logos, especially in the sustainability space, but we're also seeing increased usage in HYSYS and Aspen Plus with the current market conditions. From there, our customers expand into Concurrent Engineering. So now they're really leveraging the other products from the same data, the same models as HYSYS and Aspen Plus, into a solution that's going to accelerate their design and engineering life cycle. Then, as projects go into operations or as we're looking at existing operations, we land into life cycle engineering. Okay? So what we're seeing here with Concurrent Engineering is an average of 3x ACV growth as customers expand into that solution, and then as we capture them into life cycle engineering, we're seeing up to 18x ACV growth. So although we have market leadership, this is showing that we have plenty of white space and a great runway to continue to grow ACV. Here's an example, a sample customer. This is a major global engineering, procurement, and construction customer, and you can see how, as they've transitioned from point products to solutions, how ACV has grown. All right, so when we look at the portfolio, here, this block is showing you the products and solutions within the performance engineering suite. They go all the way from feasibility into operations with a focus on optimizing CapEx and OpEx while accelerating time to value. So when you're looking at design of a facility, could be a greenfield or a brownfield project, a main key focus is technical feasibility. Is it going to work? How do I optimize capacity? And at the same time, how do I optimize my capital spend? So that's where HYSYS, Aspen Plus, and the Concurrent Engineering solution help our customers with millions of dollars reduced in capital and up to 50% faster time to value. Once you get into operations, the same models can be leveraged for operational efficiency. So this could be done through offline what-if analysis. It could be done online, looking at equipment monitoring or optimization, ultimately supporting digital twins, right, in the operation space. So that leads into the value of really taking that data and leveraging it across the life cycle of the asset. So I wanna share an example here. This is GS E&C. They are a EPC company out of Korea. They were a long-time HYSYS point product user. On a revamp project, they had a challenge to increase capacity, the ethylene capacity, by 12% in a very short schedule, and at the same time, build it in the same exact space in the plant, okay? So they, of course, started with HYSYS and built a very large integrated model to look at options for increasing the ethylene. They identified that they would need additional equipment and larger equipment. Then they leveraged our Exchanger Design and Rating product to really rigorously design those additional equipment, and then they leveraged Aspen OptiPlant to look at, physically, how were they gonna get the additional equipment and the larger equipment to fit into the same cold box space. And they also had to ensure they maintained the tie points 'cause they didn't wanna impact construction cost. So this was a great opportunity for them to expand into Concurrent Engineering, and they were really able to deliver the project on time in that tight schedule and demonstrated that they could get everything designed and increase capacity by 12%. Vikas showed you earlier an example, sustainability pathway for carbon capture, utilization, and storage. The first two pieces is where the Performance Engineering suite fits in.... We're seeing our customers leverage Aspen Plus and HYSYS and all the new models that we've released, the new capabilities and sustainability, to really optioneer and design and define new processes. Then it can be leveraged either with a pilot plant and scale up to an actual plant. So just a last story I wanna share here is, our high-velocity sales team engaged with Carbon Engineering very early when Carbon Engineering set out to define a new optimal direct air capture process to capture one million metric tons of CO2 per year. Carbon Engineering leveraged Aspen Plus to design the process, but their goal was to reduce the levelized cost, right? That's the key challenge these days with DAC facilities, is the cost is still too high. So they worked in Aspen Plus to look at how to optimize the water usage, energy efficiency, the selection of the type of equipment to really drive down the levelized cost. So in this paper they published, they provide this detailed process, and our Aspen Capital Cost Estimator was a great way for them to validate that they could build this and drive down cost. Since then, Carbon Engineering has been acquired by Oxy. They're in the process of building out this facility, and we look forward to partnering with them as they are gonna use the same data into the lifecycle engineering of that built facility. All right, I'm gonna wrap it up just to kind of repeat the key points here. We are seeing increased usage of the Performance Engineering suite, especially with all of the capital spend, the trillions of dollars you saw earlier, that are going into a lot of the sustainability and energy transition projects. And we have a great opportunity to capture the white space with our expanded Concurrent Engineering and lifecycle engineering solutions. Thank you, and I'd like to invite up Sally Jacquemin. Thank you, Sonali. Oops! All right, who's ready for the most exciting topic of the day? Yep. Okay, I see one hand. Good, good, good. You guys are a tough crowd, jeez. My name's Sally Jacquemin. I'm Vice President of our Power and Utilities business unit. I've been in the power and utility space in software industry for about 15 years, and I've held a variety of roles in our business, from building out our distribution utility sub-segments, project governance for some of our key projects, and also leading strategic sales. Today, I'm responsible for building our business strategy and executing on that for Digital Grid Management or DGM. Oops, wrong button. So it's been a little over 2 years since OSI became part of the AspenTech family. In those years, we've significantly transformed our business in terms of both ACV and margin expansion. We are confident of our ability to accelerate this growth going forward for a couple of key reasons. First, the global energy transition is happening faster than expected. This is driving increased grid complexity, which utilities today just don't know how to handle. They're not set up to address this. So our digital grid management solutions are really table stakes for utilities to handle the increase of data, new grid dynamics, increased customer expectations, and the growth in electrification devices. Second, once a utility purchases a single product from our suite and learns the modularity and how our products add on top of one another, they quickly identify other solutions, other areas that we can drive value at these utilities. This creates tremendous upsell opportunity across our entire customer base. To support this growth, we have built out a global partner ecosystem that I'll talk a little bit more about throughout the slides today. Really thinking about DGM and our employees, we are driven to execute at an increased pace, not only to achieve our business objectives, but also because our customers are asking us to. When I visit customers, they're saying, "Sally, you need to move faster. I'm having critical pain points. We need DGM. We need your solutions at a faster, in a bigger way to manage more." So that takes us to those challenges. What is the utility industry facing today? It is really an unprecedented time in the power and utility industry. When you take a step back and realize that the electric power grid is only a hundred years old or so, the scale of change that's facing the utility right now is absolutely tremendous. In addition, not only the scale, but the pace of change is moving faster than anticipated, with many regions still in the beginning stages of this energy transition journey. Global power generation is expected to almost triple by twenty fifty, with the majority, almost 80 up to 85% of that, coming from renewables. To support that growth, in parallel, the grid itself will need to expand, and it's estimated to grow by almost double in the next couple of decades. Extreme weather is becoming more common, further stressing the resiliency of the grid, and cybersecurity threats have doubled in just the last couple of years. Finally, there is a shortage of skilled workers in the industry, with almost 50% of the utility workforce eligible for retirement next year. Investment in digital solutions is absolutely critical to utility success, and our AspenTech Digital Grid Management solutions is at the absolute center of addressing all of these challenges. So the overall market growth for our industry is growing at up to 25% year over year. We feel we can beat that growth, and because for a number of reasons. One, the barriers of entry to our industry are very high due to the complexity of the software and the complexity of the grid, which means we only have a handful of competitors to really stay in front of. Our ability to differentiate from our competitors is reflected in the strong and steady growth of our customer base, where we have over 30% new customers over the last five years. The utility industry is an established, highly government-regulated industry, which means there's not very many new utilities emerging at any given time. That means that almost 100% of our customers are switching from a competitor's software. We have many key technology differentiators that help us win against our competitors. I'll touch on a couple here. The first is our Enterprise Grid Control platform. This creates a single common view for utilities, for situational awareness, a single user experience. It also enables a single maintenance system, an improved operational productivity for managing these complex systems. Our state-of-the-art cybersecurity measures to ensure data integrity and secure data flows are becoming a requirement in many regions of the world. So when we look at our portfolio, we offer a comprehensive solution suite that's natively built from the ground up to serve both electric and gas real-time management. 30 years ago, we started our product portfolio with a few transmission applications and SCADA. A little over 10 years ago, we expanded into the distribution utility sub-segment. A little over 5 years ago, we expanded into gas pipeline management, and now we are continuing to expand those applications and the industries that we serve with offerings such as our Microgrid Management System that will be launched this fall, and our Virtual Power Plant product that came out last year. We plan to sell our microgrid management system into the process industry segments. Our customers in that segment from Heritage AspenTech, many of which are in energy-intensive industries and will drive a lot of value from optimal energy management. So I wanna give you just a little flavor of what our software looks like in the digital grid management space, and what an operator at a utility might be looking at. So first off, if you put yourself in the shoes of an operator, you're gonna be sitting in a room like this, kind of half lit, dimly lit like this, and you're gonna have about six, maybe six screens in front of you. You know, you're operating, you're looking at six different things all at once. Those six different screens, they're all gonna have something from our system on it, something different, different information. You will certainly have a geographic view, so a map view, and this is gonna be like looking at Google Maps, but instead of all the roads and where the next McDonald's is, you're gonna be looking at the electrical system, where the wires, the poles, the substations, the electrical devices are. Then you're also going to be looking at the schematic overview or a one-line display, and this is really what the electrical engineers need to look at for the, the detailed information. When you dive down into that geographical display. So previously, so you saw an island nation that we modeled, there, that you saw the electric grid. You can dive down into many different layers and views to get to a street view. And here, that white halo on the line indicates that that feeder, anyone along that line, is out of power. As an operator now, I can understand that this feeder with, you know, a hundred people or a thousand people are out of power. I can automatically isolate that section of the grid through switching. I can reroute power through other substations and lines to electrify as many people automatically as possible, and I can automatically assign field crews, worker crews, to go out and address those issues. All the different colors, the little tags indicate different devices on the grid or switches or tap changes, things of that nature. Finally, as an operator, you'll see different dashboards, and you're gonna wanna see the information in different ways. Here you could see your distributed energy resource output. How much solar am I getting? How much wind am I getting? What is my battery capacity at any given time? What is my forecasted load for the next week? You know, when should I be discharging my battery or, or charging my battery? Operators need to figure that out with the help of our software. So, as I said, it's very common for utilities to start their digital transformation journey with a single product, and then continue to procure additional products, expanding ACV by up to ten to fifteen times. A great example of this, of the modularity and flexibility of our product suite, is with Sacramento Municipal Utility District, or SMUD. SMUD is the sixth largest, community-owned utility in the U.S., serving over six hundred and forty-five thousand, customers in Northern California. They have a very ambitious zero carbon goals and a very rigorous digital transformation plan to achieve those goals. They contracted with us back in 2017 for our AspenTech OSI Monarch SCADA and our advanced distribution management system. Shortly after that, they called us up and said: "Hey, we need your distributed energy resource management, DERMS, because we have such an influx, faster than we expected, of electric vehicles and rooftop solar." They needed a way to model and manage that, understand where those assets are on the grid, and be able to optimally dispatch them. Finally, last year, they procured our outage management system, and our outage management system, you know, that now rounds out a lot of the big pieces of a distribution management system, an ADMS, we call it. That outage management system now enables them, their operators, to work from a single system, so they're not switching between vendor A and vendor B. All they have is one big system on all six of their displays, and they can get a comprehensive view of distributed energy resources, outages, where their field crew workers are, where all the power flow is happening, so they can see all of that from a single system, that's the single system to maintain and support, driving productivity throughout their entire organization and all stakeholders. This journey is indicative of many of our customers that are modernizing their software solutions in a stepwise manner to achieve their operational and decarbonization goals, so our DGM user base is very robust in North America, and it's accelerating internationally. We have established a right to win in all regions, and here's a few examples. Salt River Project, or SRP, leverages our generation and transmission systems today, and they're deploying our ADMS and our DERMS to support and serve the two million residents in the Phoenix metro area. TenneT is the transmission system operator for the country of the Netherlands in Europe, and they have our generation management system live. They're deploying our transmission system to balance the electric grid, and those twenty gigawatt of wind power that's coming from the North Sea will all be managed by our system. So that'll serve forty-three million people in the country of the Netherlands. AES El Salvador is using our ADMS to provide resilient service to over 1.5 million people in El Salvador. Adani Electric in Mumbai, India, is using our ADMS as the first innovative control center in all of India to serve over three million people in Mumbai. These utilities demonstrate a strong and a growing global user community, which we are actively expanding with several key strategies. We're increasing our regional sales teams, we're building our global power network, and we're enhancing product features and launching standard solution packages to meet regional needs. And as always, we're partnering with our customers in each of these regions to gain further insights for innovation. So as we grow our software sales, our partners are an increasingly important aspect in delivering software, enabling the full digital transformation achievement of our customers. We have made rapid progress in building out our global partner ecosystem, without sacrificing our customer experience through things like our Value Assurance program. With over forty global software delivery partners certified to deliver our solutions, and strong oversight and support from our digital grid management services team, we're providing the assurance utilities need to be confident of their investment. Our deployment partners add tremendous value to our customers with their expanded expertise, increased resource availability, and global reach, which allows us to focus on things like product enhancements, innovation, and customer support. The future is bright for digital grid management, and the utility industry is investing significantly to transform their digital technology, where AspenTech is the clear choice. We have significant upsell potential with our existing customers, who are actively engaged in our user community. We have a robust strategy for international growth, with key regional anchor utilities leading the way with our solutions. With that, I'll say thank you and hand it over to Alex. Thank you, Sally. So I will talk about the growth drivers in the manufacturing and supply chain suite of products in AspenTech. My name is Alex Kalafatis. I've been with AspenTech for twenty-four years now, one-third of this, eight years in product management. It's been an exciting journey so far. Looking forward to the future and all the excitement that it brings. When we look at the manufacturing supply chain products and the growth drivers for this, as Antonio and Vikas and the other speakers talk about, the strong tailwinds from the energy transition. Also, a driver from going from automation and optimization all the way to autonomy, autonomous operations, which is enabled by the embedded AI. Many customers want to go into an integrated platform that we provide now, the unified platform, and I'll talk more about this, but it is a collaborative environment with high-performance computing capabilities, web-based, cloud-enabled. That provides this collaborative environment, increases the efficiency, the productivity, and this is a growth driver for customers moving from the point products into this platform-based. The Production Optimization, which is enabled by this unified platform, helps us to cross-sell and upsell products. There are a lot of pain points in the industry, and this challenging business environment is driving for these digital solutions in manufacturing and supply chain. The dual challenge to meet the production goals, while at the same time you also achieve the sustainability goals, is something that our solution helps our customers. There is a misalignment between the business processes and the operating processes, and that's a gap that we, with our solution, we're minimizing. We are also minimizing the energy usage and the CO2 emissions. We're optimizing the constraints limits. Every process has some constraints. Identifying those constraints and optimizing those drives every plant to the limits of its performance. And then also eliminating those manual manufacturing execution processes and minimizing all these information silos. When we look at the manufacturing supply chain solution, there are different processes. Like the planning is what refineries and chemical plants are using in order to select the best, the feed selection, the best feed, also for the optimal plan. And this is a solution that, as Antonio mentioned, 66% of the world capacity is using, our planning solution. Also scheduling. Scheduling the various process units in the plant, reconciling thousands and thousands of measurements in order to provide more informed and accurate information for the planners and the schedulers, and also dynamic optimization, a minute-to-minute dynamic optimization that is sending targets also to the bottom layer in the field, inside the plant, which is the advanced control, advanced process control solution. So instead of providing these solutions as point products, now we're unifying them into a unified environment, which is using the model alignment between the various products and components of each one of these planning, scheduling, dynamic optimization to maximize the synergy and also maximize the productivity. And this vertical integration is also enables horizontal integration with the performance engineering that Sonali covered. More accurate models provide more accurate and aggressive plans to drive, again, the limits of the performance. The same thing with the asset performance management. So our unified solution is reducing the energy and the CO₂ emissions, improves the performance, maintains the optimal operating conditions, and last but not least, enables the value chain optimization, which is the ultimate goal for every operating company. So this is a similar journey with the other speakers for the manufacturing and supply chain products in AspenTech. Customers start with point products, again, an advanced process control solution or the planning solution, and then they move into integrating products. And this is where we see, again, four times growth with customers that moved already into this maturity level. And then this is what enables site-wide rollouts of APC and optimization. Then we moved into the final stage, which is going into regional optimization, going into supply chain optimization, and this is what really drives our growth, and this is the huge potential ahead of us. If we stack all our solutions from advanced process control, dynamic optimization, yield accounting, and then on top of this, the prescriptive maintenance from APM solution, and also the digital twin from the performance engineering, we get huge benefits. Now, when you multiply that benefit dollar per value, times the capacity of every refinery, times 365 per year, this is hundreds of millions of dollars of benefits to the customer. At the same time, we're working on the dual challenge, and the customers are achieving hundreds of thousands of kilotons of tons per year of reduction in CO₂ emissions. So if we look now in one of the solution, the advanced process control solution, this is an area that we've been working for many years, and there are a few vendors out there. Why AspenTech? As Antonio said in his first steps in his career, he was doing these benefits studies, and then every time you close the loop and you install advanced process control, you have a step change, which is millions of dollars. And this is the ROI, sometimes a month, not even a year. But the pain point in industry is that those benefits are eroding as the time goes by. And unless you have the capacity, that nobody does, to do more and more projects to bring the benefits up, those benefits keep going down. And then five years later, when you have a turnaround in the refinery, then you do another projects, which takes 80% of the cost of the original project to bring up the speed. And sometimes the picture is worse because you get someone, an operator, doesn't trust it anymore, turns it off, and that way, the benefits go back to zero. Our solution has adaptive capabilities. When we talk about our vision in terms of self-adapting and self-sustaining, the vision is here for the manufacturing and supply chain products. We already have an adaptive solution out there, which is differentiating us from our competitors, that keeps the benefits always in that blue line that you see there, and there's no erosion in benefits. Also, what we have done more recently is we have the Aspen Virtual Advisor, or AVA, which an operator or an engineer can ask, "Why is this not maximizing the reflux rate? How can I increase my production to a specific target that comes from a scheduler?" And AVA provides the answer, provides actually options with the highest priority for the operator or the engineer to select. So we have faster implementation, up to 50%, faster, so lower cost and increased benefits by 20%. So we have a lot of case studies, a lot of success stories that customers have presented. Braskem presented 20% reduction in energy for a cold side of an ethylene on an olefins plant. And also downstream, that we've been in many years, we have millions of dollars of benefits. But I will highlight the one on the top right from ExxonMobil, where they've been using our solution in downstream for years, and they're expanding more and more into upstream. And that was a more recent presentation in the Permian Basin, where they used our solution for the optimization and control of 100-plus wells. So as the takeaway, we see an increased growth in the manufacturing supply chain because of the customers who want to upgrade into this unified platform to maximize the synergies, to maximize their productivity and efficiency, and also the driver from going beyond optimization, beyond automation into autonomy, which is enabled by the embedded AI that we're providing. Thank you, and with that, I will bring Vikas up. Thank you. Thank you, thank you, Alex, Sally, and Sonali. I would like to round up the the product session. Antonio already talked about our vision for self-optimizing assets: self-learning, self-adapting, and self-sustaining. You saw in Alex's presentation already a milestone along that journey. Our DMC3 technology is already self-adapting, already self-sustaining, and we see that as a important milestone and a step towards the Self-Optimizing Asset journey. Emerson vision is highly complementary, enhancing decision support, breaking down the silos, leveraging the data across the enterprise. Together, we have an opportunity to really cover the entire optimization, right from sensors, automation, down to asset optimization. Entire spectrum of possibilities from edge to enterprise. For that, we'll work together to drive unified data models, to drive the alignment between the two offerings, and also integration by design and with purpose, on specific areas of improvements. That will hopefully result in higher margins, safer operation, greater sustainability, and also improved reliability. So this is really our future direction. We are already making progress in that direction, in several areas, and we'll continue to report and update you on this journey. So just to summarize the product and innovation section, at the heart of our strategy is product usage and adoption, a well-proven term and token model, and streamlined engagement with customers, which starts with systematic competency development, customer engagement that maximizes value creation, and we'll continue to improve on that. Innovation, we'll never forget what has given us the competitive advantage. We'll continue to invest on core innovations moving forward, but also accelerate the integration within the suite as well as across the suites. Our patented workflow of activation is one of the milestones along that journey, but you'll see a lot more progress in that direction. And then this will allow us to also respond very quickly, as we have done, with our leadership in sustainability pathways, as well as staying ahead of the curve in industrial AI. All these are stepping stones towards the journey of Self-Optimizing Asset. So future looks bright from products and innovation point of view. And with that, I would like to invite David Baker, our CFO. Thank you, Vikas. Good afternoon, everybody. My name is Dave Baker. I am the CFO of AspenTech, and I am completing my fourth month as the CFO of AspenTech. I will say, I had high expectations, coming into the role, and between the team, the company, and the opportunity, those expectations have initially been exceeded, so I'm happy to be here. I will spend today kind of bringing, wrapping this all up and trying to bring us home and tell us really, with all this great tech, technology, let's talk a little bit more about the numbers and what does it mean to you, so with that, I'm gonna start with taking us back and doing a little reminder and housekeeping. First off, we do recognize our revenue under ASC 606. What that means is that our revenue does is kind is variable from quarter to quarter and year to year. So therefore, the two key measures that we really manage to is the annual contract value, or ACV, and then free cash flow. We think this is more representative of how our business should runs and really is more indicative of the value we'll create. For our primary profitability measure, we talk about the ACV margin, which we take our non-GAAP operating expense, and we subtract it from our ACV, and that calculates the ACV margin. This really is more indicative of what we could expect the free cash flow to be generating as we go forward. So as we move through the slides, I will be talking ACV and free cash flow more. Just a reminder, we, you know, we have a very strong, solid base. We had a strong result in FY 2024. We grew 10%, delivered 28% ACV margin, and generated $335 million of free cash flow. Antonio shared with you the, makeup of our suite, our business by suite and our business by industry. We really have seen a diversification of both those, since the last time we met with you, and this really does give us a foundation to drive that growth as we go forward. Just to reaffirm. We are reaffirming our FY 2025 guidance this year. As we said at the, as we, in our Q1 earnings call, we expect ACV to grow approximately 9% year over year. We expect our ACV margin to be approximately 34%, and we expect our free cash flow to be $340 million, which would be a 1% growth... but if you remove the impact of exiting our Russia business, as well as the one-time cost associated with restructuring, that would represent a 15% underlying growth. So let's talk about the value creation model. Antonio shared this before, but I think it's worth talking a little more. We start with the ACV growth. We spent most of today really talking about that. That diversity mix that we have in our suites and in our industries that we serve really do give us opportunity in these large markets with durable headwinds. We've talked about, and the product teams really demonstrated the innovation that we have and are continuing to develop into our products, and really the scalable model of our business to really drive that product usage and adoption amongst our customers. We truly believe that, absent a major disruption in our end markets, we should drive to that high double-digit growth that Antonio talked about. That being said, we also recognize that there are gonna be challenges in some of our markets from time to time. But given the new mix of business we have, we expect that at the trough of that growth rate will be a high single digit. Things like the chemical we see today, that drives us to 9%. But we think that's a very strong, healthy business to drive us forward. Then we look at the expanding margin. That really gets down into the target operating model that Antonio shared with you, and I'll dive into more. We really are. The levers around that is driving that software mix and really leveraging the scalable model of the term and token business, and then really it comes down to just a focus on cost and re- and the tried-and-true levers of being committed and disciplined around driving our cost management through the pieces. And then lastly, with that, we will be good stewards of our capital allocation, make sure that we continue to invest in the organic growth, be disciplined around the measurement of the merger and acquisition portfolio that we do, and then ultimately, we are committed to returning excess cash to our shareholders through share repurchase. So as I move forward, I'm gonna dive deeper into really the margin and the capital allocation and share you more about those frameworks that we follow. So this is the target operating model. Post the Emerson transaction, we have seen our cost as a% of that ACV go up. As we've brought those three businesses together, there is some infrastructure we have built that we need to deal with and grow into a little bit, and then just be disciplined as we go forward. As we go forward, you can see we have the targeted ranges with which we wanna drive each of the pieces of the business to, in order to deliver that 45-47% ACV margin. As we do that, we do expect to grow the free cash flow in the mid-teens throughout annually as we go through the years, and that will drive us up to that 40-43%. So how are we going to do that? It really comes down to driving this, what we call the AspenTech playbook, to achieve this. There are three levers that we will really look at and drive. The first is to continue to go back to that pure-play software model. We brought in a lot of services as we brought in some, the, especially in the DGM space. We will continue to look at that services and drive a model that is more software-centric and partner with our premier partners to do the implementation services that will allow us to continue to drive that profitability. We're gonna leverage the scalable commercial model, so as we drive people to the term and token model, that gives us advantages both to the customer and us, which will help us leverage our sales and marketing and continue to drive up that. And then lastly, we'll have this rigorous focus on efficiency to really drive the leverage. That really comes down to employing either technology in order and just a continuous improvement mindset to drive the cost of the general, administrative, and R&D down into the percentages we want and leverage as we continue to find that growth. The other advantage of driving this playbook is it really gives us a common method to manage all of our product suites. If we have a similar model of mix of services, that model of term and token, and then leverage into the other cost, we can manage across all the suites similar, which also then gives us advantage as we make acquisitions, to bring those acquisitions in and drive them into that playbook and drive value for those as well. So let's look at the playbook a little bit. As you talk about software and pure play, you know, what we have going on here really starts with what we talked about at DGM. We're building momentum in creating this independent service partner network, which will allow us to go out and leverage them to do the implementation services. As you can see, as you do this, we had a very high level of cost to revenue. As we use those third parties to do that work, we will see that cost to revenue come down, and we will grow into it. What it does mean is also we have a greater capacity or access to a greater capacity of implementation services providers, which will allow our customers to implement our products more quickly and get to value faster. So advantage to us and advantage to them. We do expect, though, given the nature of the markets that we work in, in DGM, that the amount of services, the percent of services that we have to provide for each of our product contracts will be higher than what we experienced under AspenTech. So therefore, you can see as we drive the cost of revenue down, we will not get back down to the previous levels we had prior to the Emerson transaction, but still drive improvement through the process. The second lever really comes down to this, the scalable model and really driving to that term and token offering. I think we talked earlier in the product section about what's the benefits. There are benefits to our customers because they get to go out and really leverage those tokens across all of our suites. So as they have changing needs, they can use the tokens to pull in and go meet the needs that they have. The advantage to us, it really does get help give us insights into how the customers are using our products, and it really allows a much more focused, scalable engagement from our sales and marketing team with the customer. We can go in and have conversations with them about what pain they're experiencing and how they can use our products differently and implement more of it to drive that. It really is a highly scalable model and will allow us then to grow into this go-to-market organization we've built over the last couple of years since we... the Emerson transaction. You can see this, the progress we have had with SSE. We introduced the, you know, they were primarily term when we came in, and it continued to grow that, and we introduced the token model at the end of last year, and we are steadily growing with that throughout the course of this year, and it's the pace is increasing. We will continue to drive that playbook into DGM as well. Lastly, it comes down to really the focus on the cost discipline. You know, as we talk about sales and marketing, it really is that scalable model. We talked about that term and token, right? So as we have that model, we'll be able to leverage the organization we have. It allows us to be able to deliver more value with the same resource. As you look through the R&D and general administrative cost, it's really the normal things you would think about. We'll go implement technology to make our lives more, our people more productive and really be able to drive the savings through there. While we have primarily finished the integration work that we set out to do with DGM and SSE, we still have a few areas to clean up, some things like our org, our regional structure, as well as consolidating our ERPs. And then ultimately, it just comes down to setting that focus of how do we continue to do things better and have that continuous improvement mindset throughout our organization and have our organization rally around that. So we're ensuring that we're not only driving efficiencies into our ops, but we are freeing up money in order to invest in the most strategic programs that we have. As we do this, we know we will drive the target cost down into those percentages and drive towards the target operating model. We have seen this happening. So if you look back from 2023 to 2024, we increased our ACV margin by 500 basis points. We expect increase it by another 600 basis points from 2024 to 2025. This puts us on a trajectory to really drive that margin growth going forward and get up into that range that we talked about. We've also seen it come through in the free cash flow. As we increase our ACV margin, we see that drop down and help us generate the free cash flow through the growth. We were able to deliver a 15% free cash flow uplift as we went from 2023 to 2024, and we expect the underlying free cash flow, as I talked about, when you remove the impact of exiting Russia and the one-time costs that we're gonna incur from restructuring in 2025, underlying, we would generate 15% free cash flow growth. Now, why I like 15%, and that's a great number, nice and round, free cash flow will have some volatility year to year, just due to the nature of the timing of renewals and collections, as well as different things like cash tax and the international exposure. So it won't be nearly as linear, and we would expect it to be a little volatile as we go through the year, but generally deliver those mid-teens growth. So then it takes us to, with the free cash flow, how are we gonna allocate that capital? What are we gonna do for it? AspenTech has had a very defined capital allocation framework for many years, and I fully endorse it. It really starts with creating those plans that make sure that we have the investment, as we talked about. Generate that productivity, make sure that we generate enough savings to drive that organic investment as we're laying out our free cash flow plans, and are able to deliver in the mid-teens. Then our first priority is acquisitions. We will use the free cash flow we have to go out and make acquisitions and drive that inorganic growth. And then after that, with the excess cash we have left over, we're committed to giving it back to shareholders through share repurchase versus letting it accumulate on the balance sheet. You can see we have implemented that and have continued to implement that in 2023 and 2024, as we've done both share repurchase and acquisitions over the last couple of years. So let's talk about a little bit about the acquisitions piece of the capital allocation framework. Antonio talked about the disciplined approach we take, and we do have one. It really starts with that strategic logic that Antonio talked about. We wanna go find assets that are mission-critical, OT-focused software assets, and we want them to be able to serve, be in large, growing markets, and that digitalization and sustainability is imperative. They've gotta have those pieces, those factors to them that Antonio shared earlier. Once we identify those assets in those spaces, then we gotta deep dive into their financials. We wanna ensure that they got the technology, the go-to-market, and the data strategy, which will really drive the synergies with AspenTech. So that we can take our AspenTech playbook and the experience we've had over the last couple of years from integrating DGM and SSE and apply that to drive accretive ACV growth and FCF, accretive ACV growth and free cash flow. You know, we will drive that so that they will meet the internal. We don't wanna buy assets to buy assets. We're gonna go buy assets where we can drive premium growth and really beat our hurdle rate and drive to a nice return. And then, in order to ensure that we capture that value, it really does require us to have well-defined synergies and track them so that we are ensuring that we're delivering them, and we can adjust as we go and understand what's going on to capture that value. So this is a framework we will use to evaluate and acquire and really drive and capture the value of acquisitions going forward. And then lastly, it comes down to the share repurchase. AspenTech was committed to giving back money or returning money to shareholders since, you know, for a long time, and you can see this. Over time, AspenTech has really driven share repurchases. That hasn't changed since the Emerson transaction and will continue. So we believe in giving that back versus having it accumulate on our balance sheet, and we think we have been able to demonstrate doing plenty of that while having room to both invest in organic growth as well as inorganic growth. With that, I will wind this up with now revisiting the target operating model. We will use the AspenTech playbook in order to you know, execute on our plans and leverage the growth that we've talked about today to deliver, get back to these premium margins, and free cash flow margins that we've had in the past. So I wanna thank you for your time, and for being with us today, and I'm gonna turn it back to Antonio to wrap it up for us. Very nice. All right. Nice job, Dave, and nice job to my entire AspenTech team. You all did a great job today. A couple more slides here to wrap up before we go into the Q&A. First of all, I just wanna emphasize the thesis, if you will, for investing in Aspen Technology. Market leader in mission-critical software, no one comes close, and we, while we may have one or two competitors here and there, the breadth and depth of these suites of technologies are unmatched. Diversified industry exposure and, frankly, the utilities industry creates a great, resilient amount of CapEx that we will benefit from on a continuous basis. Uniquely positioned to address the dual challenge, hopefully, that came across. The same technologies that we've used for decades to drive value, financial value, are the same technologies that we're using to drive sustainability, to drive resiliency and reliability. So huge value creation for customers, and ultimately, it's about value. It's just that customers today are putting equal weight, depending on the region, on that reduction in emissions as a value driver and also financial value. I'll tell you, we have an integrated oil company customer that today, on their balance sheet, you see $500 million of cost associated with CO2 emissions in one of the regions of the world. So there's a real value to reducing emissions for these customers. World-class and expanding customer base, and I love this aspect, is they're coming through our high-velocity sales organization, big organizations. So it's... We're just you know, dipping our toes into these organizations through our high-velocity sales. They buy the engineering suite, HYSYS model for sustainability use cases, but eventually, when they build those assets, and they start operating them, our manufacturing supply chain suite is gonna become relevant, our APM suite, and other suites. So this is a real opportunity that will grow over time. The breadth and depth of our portfolio, the innovation and expertise, and I think we've talked a lot about that, but this is the key differentiator between us and the competition and what our customers appreciate about AspenTech. The other thing is that the density of our products in our customer's organization is reached critical mass. So this journey from point products to integrated products to solutions is real, and it will accelerate as time passes.... Look, we are probably one of the most diverse organizations, that exist in the software space, especially to be an industrial software leader. I'm very proud of the diversity and talent that we have in the company. Hopefully, by now it's clear the multiple pathways to grow this company, the ACV opportunity, they are pushed to profitability. We demonstrated it already, over the last decade, that while our growth rate can fluctuate from double digit to mid-single digit, we can drive to very high margins, and prior to the Emerson transaction was 52% non-GAAP operating margins. We're setting targets that we believe are very achievable and that will take a few years to achieve, and then certainly the investment capacity and the discipline that we have around that investment capacity. This is a very exciting opportunity, and frankly, I do wanna thank all the AspenTech employees, because over the last few decades, and really especially over the last two years, they've worked incredibly hard to set up this opportunity. This is a huge opportunity for Aspen Technology. We are the only ones, and our customers tell us, we are uniquely positioned to capture this opportunity, and we will do so with the commitment and conviction that exists in the AspenTech team. So my closing slide is going back to the takeaways. I know we've given you a lot of information over the last three and a half hours, but hopefully, you are walking away with greater clarity around the opportunity, around how well we are positioned to capture that opportunity, the target operating model, of course, very straightforward, and the value creation from that model, but what it will take to achieve it and how we're gonna achieve it, more importantly, and certainly the end market dynamics. With that, I wanna thank you all for attending, certainly those of you on the webcast as well. We're gonna go into the Q&A. I wanna invite Will Dyke. He will make some preparatory remarks to set up the Q&A, while we also bring some chairs here to answer the questions that you may have here. Then the Q&A is gonna be for thirty minutes, isn't it? Yes, sir. Yeah. Okay. Yeah. Come in. Okay. Thank you. Thank you. Okay. Hello? Yeah. Here, set that up. There you go. It's good. It's good. Yep, there we go. Okay, thank you, Antonio. So now, as Antonio said, we'll move to the Q&A session. I will welcome to the stage Vikas, Dave, and Sally, to work with the Q&A, as well as Antonio as well. I shouldn't have let you leave, but now I'm calling you back, so here we go. So, just a few rules of engagement in terms of how for the Q&A process. If you have a question in the live audience, please raise your hand. Myself and Brian will be, there he is in the back, will be carrying around the mics and can supply them. When asking a question, please first preface with your name and firm prior to asking the question, and we do ask that you keep it to one question per investor, given the limited time. For those online, you do also have the opportunity to ask a question, so please submit your questions through the webcast portal. We will be monitoring this. In addition, please note. I mean, please note, just in general, it's highly unlikely that we'll be able to get to everyone's questions today, given the limited time. So if you have a question that doesn't get answered, please feel free to follow up with myself or Brian, et cetera, after, okay? Just a note on time, this will be a half an hour session, okay? With that, let me please welcome Antonio, Dave, Vikas, and Sally. Okay. Thank you. Yep. Thank you, Will. All right, and I will act as the moderator, so I'll flow questions to different team members here. So, who wants to go first? Rob? Thanks, Antonio. Appreciate it. Rob Oliver from Baird. Voiceless. Apologies. So first of all, thanks for all the great information. Super helpful. One of the themes that's really struck me was this, you know, evolution of you guys moving from, you know, a set of point products to really delivering high-value solutions to your customers. And, you know, I guess I'd love to hear more about, for example, Sally even mentioned, you know, selling the grid into core for the microgrid solution this fall into your core. So I'd love to hear a little bit more about how the go-to-market approach for your team has evolved to sell that more, that higher value solution. And one thing we didn't hear, I think, a lot about was also maybe how you might leverage Emerson on that go-to-market as well. So if that's a part of it, we'd love to hear that also. Thank you. Yeah. Let me, I'll let Sally give you specifics about the DGM motion, but let me first, say the following: Each of our suites has best-in-class technology, and it's not just one product, it's multiple products. So when a customer, signs up for a suite, because what really they license is a suite or many suites, they start using a product, and very quickly they realize that there's tremendous value to go and install another product, start using that product. And because these are best-in-class products, the relationship becomes, a dedicated relationship between the customer and AspenTech that is very synergistic and creates this natural migration to different products, which eventually lands us into high-density integrated products and then the solutions themselves. This is exactly what we've set up with the suites for DGM and SSE, but they've also had their own motions. These customers in the utilities industry recognize that OSI and now DGM have built best-in-class capabilities, and they've been ahead of the market as far as the needs of the market for ADMS or DERMS or outage management. But with that, Sally? Sure. ... We really care about two different sales channels. So there are net new, new customers, new logos that typically we respond to a request for a proposal, a public procurement process that we compete against competitors. The second sales channel that we really look at is our existing customers and supporting them holistically. Because like I said, once they have one product and they learn about the other products we have in our suite, you know, many times we can solve a lot of their problems with our portfolio, that upsell function. So we have sales teams and sales functions that really pursue both of those paths. The path with the upsell, you know, we have also fostered a very strong user community. I think that's one of our strengths with our customers. And we have an advisory council that we've started, where we have utilities come twice a year to our offices for an in-person meeting. And a lot of times the dialogue we hear there, utilities are sharing lessons learned, and they're like: "Oh, I didn't know you could do that with this product. I need that product!" You know? And so there's a lot of lessons learned and use cases and that we don't even know utilities are using our products for. So it's just there's so much tremendous potential and learnings that we're really trying to cross-pollinate and share that innovation. Yeah. One aspect of the utilities industry, which is incredibly interesting, is that they don't compete with each other. Where one utility ends, the next one begins, and therefore, sharing of best practices, knowledge, and technology is very common in that industry. Very different from other industries. Yeah. Thank you. It's David Ridley-Lane from Bank of America. You know, these are some tremendous jumps in ACV as you go from product to integrated to solutions, 10X, 15X. The question is, how can you accelerate the upgrades? Hmm. You know, it seems like if I'm hearing this, the customer success groups is one of the ways that you're doing that. How much of the acceleration can that drive? Are you covering the top 100 accounts? Are you covering the top 250? How wide is that net? Yeah. Yeah. What are your other sort of leverages that you're pulling? Oh, great. I'll ask Vikas to follow me. And look, in a way, that journey from point products to integrated products to solutions, it speaks to the maturity level of customers, organizational excellence. Because ultimately, these customers have to have the capabilities and the capacity to implement these solutions, to sustain the use of these solutions and really for the value that they're pursuing. And it's one about organizational capabilities. But, Vikas, why don't you add? Yeah. No, thank you, Antonio. Yeah, basically, it's a cross-functional teamwork with multiple focus areas. Our solution consulting team is equipped with skills- Hmm ... to really identify the use cases, very quickly detect what are the new use cases and adjacent use cases our customers can exploit. It's done in collaboration with the customer, their management team members, as well as key users, and that drives competency development programs. So hands over the baton to customer support and training teams. In parallel, our customer advocates and customer success team is looking after the entire value creation process with our customer. So that drives also momentum. And the version adoption team is really focused around making sure that we are overcoming all the IT and technical justification barriers, for our customers, because each customer has very specific barriers. And as a result of that, we've been able to shrink, the cycle of adoption of new versions. So it's all complementary. Solution consultants focusing on new use cases, handing over the baton to customer support and training, customer success team taking over the entire value creation process. And then our cross-functional team on new version adoption is constantly tracking which customer is in at which version and how do we help accelerate that, because they get the benefits of the latest capabilities. So it's really that symphony of different teams working together. To your point about customers. Typically, today, customers that are using some of these solutions, top 100, top 150 customers, it speaks to the size of these customers and therefore their sophistication, organizational excellence. But what we see in emerging regions, if you will, Latin America, the Middle East, is greater sophistication. There are customers that are emerging with great capabilities because they understand the value. So I have no doubt that that customer set will continue to expand, that can deploy and take advantage of these solutions. Our Optimize conference, for example, is a great venue, and many other conferences- Hmm where they see more mature customers getting significant more value. Hmm. So they aspire to reach that, and then they obviously have questions as to how do you get there, and this is where we help them out. Great. Clark Jeffries, Piper Sandler. Yeah. I was wondering if you could comment on the timeline you anticipate for achieving the target model and whether you could comment on the linearity, whether it's going to be front-loaded or back-loaded. And then just to clarify, is that based off of high single digit and low double digit ACV growth? Said another way, it works under either scenario? ... Like, again, back in the period from 2015 to 2019, our growth rate swung from double-digit 10-12% to single-digit 4-5%, back to double-digit 10-11%, and the margin expanded from 35% to 50-51% in that period. To me, a slower growth business is an indication to be much more disciplined on spending, and therefore, you still have the opportunity to expand margin even when you're growing at a lower rate. But it does determine how quickly you can get there, and that's why we gave a horizon of 3-5 years. If we're doing double-digit growth, I think, you know, shorter horizon is feasible. You just saw we went from 23 to 28 to 34. But now, what I'll also say, it's a lot easier to get to thirty-five than to go from thirty-five to forty-five, because it's more about singles and doubles as opposed to home runs when you go from twenty-five to thirty-five. But look, it's about the discipline and an executive team that is committed to that outcome, and I believe I have that executive team. Devin? Great. Devin Au from KeyBanc. Thanks for having us today. Really, really helpful. I just want to ask about the growth trough scenario that you laid out, I think high single digit you mentioned. Definitely makes sense, that level is higher now- Mm-hmm. given DGM and SSE are in the mix. I just want to get more details around the assumptions that might have built into that framework, maybe around, you know, OpEx and CapEx environment, and also the level of sustainability projects and appetite. Yeah, yeah. How does that, those assumptions kind of compare to what you're seeing today? I mean, look, let me just give you some examples, factual examples. Between 2014 and 2016, oil and gas CapEx dropped from $750 billion globally to $450 billion. That was a 40% drop in CapEx, okay? Now, refining and chemicals performed very well during that period. The EPC industry, as a result of that drop in CapEx and lack of backlog, went into a tailspin. So we had our upstream segment and the EPC segment under severe pressure. The important thing during that period is that our competitors went into negative growth. They started to contract. AspenTech did not. We grew 4-5%, and not a single one of our suites went negative on us. They all grew during that period. That speaks to the resiliency and spend, the mission-critical nature of our products, but also the escalation that we have in our contracts and the term of our contracts, that in a downturn then negates every customer canceling their contracts or reducing their spend within 12 months. So I think that was one dynamic. During COVID, different dynamics. Certainly, oil prices went from $60-$80 to -$37, but at that point everyone stopped driving. Refining started to suffer significantly. OpEx spend was completely pulled back in refining. Now, everyone was using plastic, single-use plastics to protect themselves, so the chemicals industry was a rocket. But during that period, AspenTech grew 5.3% at the trough of the COVID period. So it just shows you again, and none of our suites were negative either, negative growth. Our competition were laying off people, growing, negative contracting and so on. So it just demonstrates the resiliency of this business. And now, if I, okay, I don't know what could be worse than a pandemic or a crash in oil prices. Maybe there's something out there. I'm sure there is something out there. I could come up with one or two things of it, like a nuclear war. I don't think any of us want that. But look, if I think about those two scenarios, and we grew 4% and 5%, and then I layer utilities, which will have very resilient CapEx spend over the next 5, 10 years, not to talk about beyond that, because I think it will continue, I can see that easy scenario of sort of 7%-8% growth for AspenTech at the trough of a macro disruption. Yeah? Mark. Mark, please. Oh, okay, Mark. Mark Schappel with Loop Capital. Antonio, talk a little bit about where your customers are with respect to the cloud, and also whether you believe a cloud migration needs to take place with some of your core products. The cloud. So, look, so AspenTech, the way we think about cloud, private cloud, containerization, we've enabled our engineering suite, we've enabled products in our MSC suite to be deployed in the cloud, private cloud containers, not SaaS. There are some customers that do want us on the cloud, global customers, and they've, they're hiring third parties, and take our software and get deployed on the cloud through containerization. A lot of the MSC customers that want us on the cloud is for basically computing power. They want to burst to the cloud, use all the computing power on the cloud, and then come down. We have planning, refinery planning customers, that instead of six scenarios, they want to run a thousand scenarios and do that quickly. So they burst our product to the cloud, they use their computing power in the cloud, and then they come down. So it's not perpetual cloud. So today, look, we've managed to make cloud available to our customer, cloud use for our products, but without the need to take on the cost of cloud or develop our products for cloud-specific. OT is an environment where some of our products are behind firewalls, disconnected from the internet, because this is about security and mission-critical infrastructure. So I'm sure someday, AspenTech will have to be on the cloud, but OT software and these industrial companies, I think these customers have also realized that it's gonna be a much longer journey to the cloud than putting Microsoft Office on the cloud. Okay? Yeah. Hi, Faith Brunner with William Blair. You guys talked a lot today about the value you create for customers and the ROI of your different products. Can you maybe reconcile that with what you've heard from customers about that maybe delaying or deferring their buying decision, and how maybe macro or what other factors are playing into that? Well, let me look. I think ultimately, and I get this question all the time, "If there's so much value to be had, why aren't these customers rushing to implement all these solutions? Why can't you accelerate your growth rate to 15 or 20%, Antonio?" The thing is that there's something called capacity, meaning the ability, the having the people to implement our solutions. These organizations run very lean from a cost standpoint. So ultimately, the person that is implementing some of our products is also in charge of running a process unit or something along those lines. So that's truly the throttle at the end of the day, is their ability to absorb technology. Now, in refining chemicals, in other mining, CapEx in utilities is moving to OpEx as well. But refineries and chemical plants, if there's a downturn, like we're seeing from chemicals, they pull back on OpEx. They reduce their internal costs, and that then restricts the spending that they put on our products. Ultimately, it takes time also to implement these products, and it's a trade-off that they make on these solutions every day. So hopefully that answered your question. Yeah. Yeah. Okay. Okay. Hello. So this one's coming from Josh Tilton at Wolfe Research. So Josh asks—Josh asks, he thanks you for the detailed content and Investor Day materials. And then on the M&A side, maybe, Antonio, if you could just speak a little bit more to that strategy. It's been an important component of our growth trajectory, and the Aspen team has been great at it. Is there any way to quantify that, the growth contribution from M&A, particularly given, you know, that it's hard to time M&A in general, and its ranking, I suppose, on the priority list of capital allocation? All the information you saw today is organic growth. It doesn't assume M&A. As is being stated, M&A, while we may want to do M&A, it can be very opportunistic, depending on where the sellers are with M&A. But we also feel that we can really move the needle if we're very disciplined and buy assets that are accretive to growth and profitability, that are in adjacencies, that play to our strengths. And when you do all that, you end up with a smaller set of targets. There's certainly, like, between Emerson and AspenTech, we've mapped a $35-40 billion dollar opportunity out there for adjacencies. But ultimately, it's how much of it is actionable when. As I said it, I feel like we're ready to do M&A now, and you know, there's a set of targets out there that I think are very interesting to Aspen Technology, and if the opportunity presents itself, we'll execute on them. Okay. Thank you. So I believe there, that concludes the Q&A session, if that's, that's okay. No more questions? No more questions. No. I still see three more hands here. Okay, I see some hands. Please raise your hand. Clark, you want another? Okay. Just something that didn't get a call on the presentation, but, you know, R&D, one of the largest leverage items in terms of getting the CapEx to the target model, seems like it could be a range where there's very minimal net dollar growth. But at the same time, it's the highest ROI from an, you know, organic innovation perspective. So could you kind of maybe frame that? You know, how is organic innovation unaffected by that amount of leverage on R&D? Well, let me look. I think first of all, R&D drives our innovation. The DGM suite requires at this moment a strong amount of innovation because it's building capabilities for Europe, for the Asia market, and all that. I think ultimately we'll grow into the range of R&D versus ACV. So we'll grow the numerator, the ACV base, and we will be very thoughtful about how we grow R&D if we do. But I don't necessarily prefer to cut our R&D because that's innovation and what drives our growth as well. In this model, there are some things that you can go after, efficiencies and productivity, and there are some things that you grow into them from a percentage standpoint, and I think R&D is one of those. ... Okay, any additional questions? Oh, got one over there from Dev. Hi, Dev Chugh from Wellington Management. Could you just elaborate on the Inmation acquisition that you guys talked about a couple of times today? Yeah. And in particular, I think there was a comment about allowing it to be open to other systems providers- Yeah. Who might want to analyze or work with that data? Would that be just a business opportunity, or is that something that you need to do in order to actually get data from other systems that might not be Aspen or Emerson? One, I mean, look, first of all, what we're trying to build is an enterprise data management platform, a data fabric, and therefore, we need to host any type of data, whether it's AspenTech, third parties, or others. Customers' data as well, they want that. It's a requirement from customers. Every time we talk to customers, they say, "But we can put other party, or other third parties' data into your data fabric." So this is no different than. And by the way, because it was a question during the break, Inmation is an on-prem data lake, which was a requirement by BASF and some of these companies that have implemented it. It reduces the cost of cloud services, and there's a pipe to send data to the cloud if you want to move some of that data to the cloud. But it will be agnostic, and it'll be AspenTech data and anyone else's data as well. Because what you want to create is a data fabric that then you can act on, not only for insights, but also visualization. There's very strong visualization capabilities around Inmation that customers want in order to understand the status of their operations and in general, data. Okay? I know Sally touched on this earlier, but just to dive a little deeper, when looking at the existing customer base, can you talk about the balance between more usage versus more products within the base and how that expansion balances out? I would say it's our salespeople with our solution consultants that get into that decision-making. As we all know, salespeople look for the path of least resistance to go to ACV, because they get paid on that. But ultimately, sometimes you have to do the hard work, which it might be new products, enterprise deals, and so on. But Vikas or Sally? Yeah, that's typically the way- Yeah ... you know, we want this tendency to, of course, sell greater number of products, but also making sure that customers are getting value from what they are. So that drives the usage growth as well. Usually, it goes hand in glove- Yeah ... the usage growth and the new products, because it creates the compelling event for the customer to look forward to another module, as Sally described in her scenario with Smart. Sure. I think, you know, the unique thing right now happening in the power utility space is there's net new problems that need to be solved. So you know, if it's X plus Y equals Z in the code, now we're expanding that, we're changing it, we're adding new functionality to manage a bi-directional power flow. And so we hear daily from our customers: "Hey, I have a problem today that no other utility in the world has ever encountered before. It's new physics. It's new frontier. You know, AspenTech, help me solve this problem." And that might lead to a new application that we then help other utilities with. Sacramento in California is leading edge because they have a lot of distributed energy resources on the grid. They had so many electric-powered vehicles on a transformer, it started blowing transformers. That's a new problem no one's ever had before. So how do we do that? We need to manage that with our software. So there's a lot of scenarios like that at every utility. TenneT, I mentioned TenneT in the Netherlands, they had so much solar power production that they didn't have enough load to take that solar power. They actually went negative. So now they have firm generation coming from a power plant. What do they do with that? Where does all the excess power go? Mm. You know, how do you maintain a reliable grid if you can't balance power, you know, load to power generation? These are brand-new problems that our customers are coming to us to solve. Yeah, but. And normally, what you see is utilities, but then chemicals, an oil company that have multiple refineries, and there's sort of an organic process to install applications. And then comes one point where there's enough density where they say, "Okay, now we're gonna standardize on advanced control from AspenTech," and they make sure that happens. And then they look at planning and scheduling. One of the examples was exactly that, and then they standardized on planning and scheduling across all their refineries. And this one company, then they looked at their value chain, and they say, "There's huge value from optimizing our entire value chain outside the fence. Let's standardize on AspenTech." So it comes in waves as well, depending on the density that they achieve on those products in refining and chemicals. ... Okay, so Antonio, maybe another one from online. Obviously, a lot of good material now about Emerson and that relationship. So one of the questions is: how do you see that contributing to the growth rate? Where is, like, the specific areas of traction that you would point investors to? I mean, look, it's what I always say. I do think we've learned a lot over the last, especially the first year. Emerson learned a lot about us. We learned a lot about Emerson. We adjusted, at the beginning of fiscal 2024, compensation plans. We identified the areas of strength of Emerson and AspenTech, and that's been our motion, and now we're starting to see real results from this relationship, which has me very excited. I think the long-term vision to have a fully integrated, seamless stack of technology that goes from the plant floor through optimization will be a very unique offering that cannot be matched in the industry. So I think there's, you know, I think this relationship and the value that it creates. Certainly it will drive value, and we're seeing that, but it's over time what it can really represent for both companies and for the industry as well. Hey, Rob. Great. Thanks for squeezing me in for one more. Rob Oliver from Baird. Dave, this is for you. So you called out both on the Q4 call, and today you referenced some tech stack work that needs to happen, ERP implementations- Mm-hmm. or ERP integration. So I'd just be curious, you know, for some investors of a certain age, that can send shudders through our spine. You know, obviously there's a. As you look at that now, having been here four months, you know, what is it that you see? How comfortable are you? And I guess also, in your twenty-seven years at Emerson, yeah, you know, obviously acquisitions, experience. Sure. What sort of tool set do you bring to that as well? Thank you. No, sir, Rob, you're right. You got to do it right. You can't disrupt the business when you do that, but the opportunity is there. We're close to being able to implement the SSE, bringing them on from an Oracle environment into an Oracle environment, and then we will work with DGM, which will be a little bit harder because we're going from a different environment onto Oracle. But we'll put the team together and make sure that we follow the process and have a robust solution before we say, "Yes, we're gonna go live," and take all the steps. We've been... You know, I have been through it a lot in my time at Oracle, or my time at Emerson, when we implemented Oracle across many sites that I was a leader of, and so I'll, you know, I'll bring that experience. But the team here has got a good plan, and we're following it, and we'll make sure that we do it right. Yep. Okay, so with that, that concludes our Q&A session. I just want to say thank you to all the presenters today who presented and answered the questions. So let's give a round of applause. Thank you, everyone, and look forward to continuing the dialogue, as I'm sure we will, in the future. Thank you for attending. Yes. Thank you. Thank you, everyone. And there will be a live webcast recording on our IR site for those who are interested. There will be a press release later today, kind of summarizing the events. Certainly feel free to reach out to Investor Relations with any additional questions. The presentation as well. Yes, sir. Yeah. Yep. Okay, great. Thank you. Yep, and the presentation as well will be available for download. Thank you.