Good afternoon, ladies and gentlemen, and welcome to the C.H. Robinson Q3 2021 conference call. At this time, all participants are in a listen-only mode. Following the company's remarks, we will open the line for a live question-and-answer session. To ask a question, please press star one on your telephone keypad. If anyone needs assistance at any time during the conference, please press star zero. As a reminder, this conference is being recorded Tuesday, October 26, 2021. I would now like to turn this conference over to Chuck Ives, Director of Investor Relations. Thank you, Laura, and good afternoon, everyone. On the call with me today is Bob Biesterfeld, our President and Chief Executive Officer, and Mike Zechmeister, our Chief Financial Officer. Bob and Mike will provide a summary of our 2021 Q3 results, and then we will open up the call for live questions. Our earnings presentation slides are supplemental to our earnings release and can be found in the investor section of our website at investor.chrobinson.com. Our prepared comments are not intended to follow the slides. If we do refer to specific information on any of the slides, we will first let you know which slide we're referencing. I'd also like to remind you that our remarks today may contain forward-looking statements. Slide two in today's presentation lists factors that could cause our actual results to differ from management's expectations. With that, I'll turn the call over to Bob. Thank you, Chuck, and good afternoon, everyone, and thank you for joining us today. The Q3 was another quarter of progress and strong execution, resulting in record quarterly financial results. The trajectory of our business is heading in the right direction as we continue to leverage our Tech+ strategy to help customers navigate through an extremely challenging and capacity-constrained environment, which we expect to continue. Demand for our global suite of services and for the benefit of our powerful technology platform continues to be strong, and the digitization efforts continue to take hold and be ingrained in an increasing percentage of our business. In our North American truckload business, we've made steady progress in a sustained tight capacity environment. Through the continued repricing of our contractual portfolio and higher volumes of spot business, our adjusted gross profit or AGP per truckload returned to our five-year average, and our AGP per mile in Q3 exceeded both our five-year and 10-year averages. We accomplished this while growing our truckload volume 4.5% year-over-year and 3.5% on a sequential basis. Within the quarter, we saw an acceleration of truckload volume per business day in each month of the quarter, with 7% year-over-year growth in September, and that growth trend has continued into October. For the quarter, NAST truckload grew AGP by $83 million or 36% year-over-year through a 4.5% increase in volume and a 30% increase in AGP per load. This included a 14% increase in spot market volume year-over-year, due in part to an 85% increase in volume that was driven through our proprietary dynamic pricing engine, which is now on pace to generate $1 billion in spot truckload freight for the year. Nearly half of our spot or transactional business was priced via integrations with our dynamic pricing engine in the Q3, delivering real-time pricing capacity assurance from the largest network of truckload capacity in North America. We closed the quarter with an approximate mix of 60% contractual volume and 40% transactional volume, which is consistent with our mix in the year-ago period. Our average truckload linehaul cost per mile paid to our carriers, excluding fuel surcharges, increased 26% compared to the Q3 of last year. Our average linehaul rate billed to our customers, again, excluding fuel surcharges, increased 27% year-over-year. This resulted in the highest cost and price per mile on record and a 33% year-over-year increase in our NAST truckload adjusted gross profit per mile. This, combined with a 2% decrease in the average length of haul, resulted in the 30% increase in AGP per truckload. During the quarter, we saw routing guide depth of tender in our managed services business increase slightly from 1.6 in June to 1.7 in September, indicating slight deterioration of shipper routing guide performance during the quarter. Given the current structural constraints around expansion of truckload supply, coupled with the continued strong demand as we head into the holiday season, we expect capacity to remain tight, and we expect to perform well in that environment, with over half of our contractual truckload business stated to reprice in the Q4 of this year and the Q1 of next. During the Q3, we continued our effort to expand our carrier network, and we launched an effort to recognize truck drivers for their extraordinary efforts, and we had incredible engagement. This led to a new record of 9,500 new carrier sign-ups and increased utilization of our carrier technology and apps. Our NAST LTL business grew adjusted gross profits by $14 million or 12% year-over-year. This was delivered through a 1% increase in volume and a 10.5% increase in adjusted gross profit per order. This increase in volume was on top of a 13.5% volume growth in the comparable quarter last year. Overall demand in the LTL market remains strong, driven by growth in e-commerce, resulting in capacity remaining at a premium. Our value proposition in LTL continues to resonate with shippers of all sizes across multiple industry verticals. Turning now to our global forwarding business. The Q3 was our sixth consecutive quarter of strong year-over-year growth in total revenues, AGP, and operating income. Based on low inventory to sales ratios and the robust pipeline of business from new and existing customers, we believe the strengths in this business will continue into 2022. In our ocean forwarding business, we grew our adjusted gross profits by $126 million or 142% year-over-year. This came through a 12% increase in shipments and a 116% increase in adjusted gross profit per shipment. Demand continues to be stronger than what the overall industry can meet with limited vessel and container capacity. Although some ports are working to implement expanded operating hours, other market constraints, such as the shortage of truck drivers, drayage capacity, and inland warehouse space continue to be bottlenecks, and port congestion is likely to continue into 2022. Our forwarding team has done a great job of strengthening our carrier relationships and procuring incremental capacity to best serve our customers, as well as working with shippers to better plan their shipping needs and to consider ultimate modes or ports. Finally, our international airfreight business delivered Adjusted Gross Profit growth of $26 million or 76% year-over-year. This was driven by a 51% increase in metric tons shipped and a 17% increase in Adjusted Gross Profit per metric ton. Demand for airfreight remains incredibly strong, partially driven by continued conversions of some ocean freight to air. Airfreight capacities continue to be strained, and we continue to position charter flight capacity to support demand from both new and existing customers. The forwarding team is continuing to add new commercial relationships with strategic multinational customers that are leading to increased award sizes while also ensuring that our existing customers have access to the capacity that they need to meet their needs. Our customers and our results are benefiting from the investments that we've made in digitization, data, and analytics, as well as our global network that's supporting our expanded geographical and vertical presence. We believe that these strategies and competitive advantages of C.H. Robinson will enable us to create more value for customers and in turn, win more business, sustain the market share gains that we've achieved, and deliver solid returns for our shareholders. Our digital investments continue to deliver customer value and unlock growth in new and exciting ways. The latest example of this is our introduction of Market Rate IQ during the quarter. This brings pricing transparency to shippers by allowing them to compare their rates to the market averages, and then using the information advantage of C.H. Robinson, break down their rates to see potential savings opportunities. When we bring these Robinson Labs innovations to the market, we see increased engagement with our customers, higher win rates with those customers that are truly realizing the value from these new products. As I mentioned earlier, the amount of volume that's being delivered through our real-time dynamic pricing tools has grown significantly. Enabling these digital connections improves efficiencies for our customers, improves our response time for quote requests, and improves our win rates. We also continue to add digital connections with our customers at an accelerated pace with 100 new customers connected via TMS and ERP connections in the Q3 of 2021. The number of daily and monthly average users across our customer and carrier-facing platforms also continues to grow with 24% year-over-year growth in daily average users of our carrier platforms as we continue to deliver new capabilities and benefits to our carriers through both the web and mobile versions of Navisphere Carrier and Driver. During the quarter, we had over 340,000 fully automated bookings in our NAST truckload business, which was an increase of nearly 80% year-over-year. Finally, as it relates to productivity, we've again highlighted a couple of key metrics for NAST in our earnings presentation. During the Q3, we invested in hiring and building our bench to support growth. On a year-to-date basis, we continue to show year-over-year improvement in productivity, as indicated by the 880-point favorable spread in our NAST productivity index, which represents the difference between the year-over-year change in NAST volume and the change in NAST headcount. Shipments per person per day is another metric that clearly shows the relationship between the timing of our increased digital investments and the impact to NAST productivity with an over 25% increase in productivity since the beginning of the increased investment period. We are encouraged with the progress that we're making on our digital investments and the impacts that these investments are delivering to our customers, for our carriers, and the impact to our overall results. Across our global suite of services, we believe that our Tech+ strategy that combines our tailored market-leading technology solutions with our global network of logistics experts and an information advantage created from our scale and our data is the right strategy and one that is aligned to the needs of our shippers and partners as we help them to navigate these highly disrupted markets and deliver for their customers. I'll now turn the call to Mike to review the specifics of our Q3 financial performance. Thanks, Bob, and good afternoon, everyone. As Bob mentioned, we delivered another quarter of record financial results in Q3, driven by strong performance in a favorable market as we continue to execute on our Tech+ strategy. Our total company revenue increased 48% over Q3 last year, and our adjusted gross profit or AGP was up 43%. Increased AGP was driven by both volume and AGP per shipment across ocean, air, truckload, and LTL. Total company AGP also improved by 13% sequentially and 33% over the pre-pandemic quarter of Q3 2019. On a monthly basis, compared to 2020, our total company AGP per business day improved in each sequential month of the quarter and was up 51% in July, up 39% in August, and up 40% in September. For the fifth consecutive quarter, prices and costs rose across our North American truckload business, with cost per mile and price per mile each reaching new highs in each month of Q3 due to the persisting supply-demand imbalance. Our NAST team navigated through this environment by continuing to grow spot volume, which was up approximately 14% year-over-year in Q3, marking the Q5 of double-digit spot market volume growth. Within our contractual freight business, where Q3 volume was flat, we continued to selectively reprice the portfolio to reflect the ever-increasing cost of purchase transportation in this market. As Bob mentioned, our Q3 truckload AGP per mile is now above both our five-year and 10-year averages. AGP per mile and AGP per load are key metrics in our truckload business rather than an AGP margin percentage, which naturally rises or falls with the changing market cycle pricing. For those following AGP margin%, if or when the market loosens within the current cycle, with the greater than two-thirds of our truckload volume on 12-month contracts, we would expect to see AGP margin% expansion as we typically have in the past. We continue to focus on overall AGP dollar growth by optimizing volume and AGP per shipment across our service offerings. With enhanced customer focus and digital investments, we expect to drive long-term growth and efficiency into our model. Now turning to expenses. Q3 personnel expenses were $399.9 million, up 32% compared to Q3 of last year, primarily due to higher incentive compensation costs and the impact of short-term pandemic-related cost reductions in Q3 of last year. Our Q3 average headcount increased 7.1% compared to Q3 last year. Despite the tight labor market, we successfully hired the talent we need to support our growth expectations, particularly in global forwarding and NAST. Given the increase in incentive compensation resulting from our profit expectations for 2021 and the additional headcount, we now expect 2021 personnel expenses to be in the $1.5 -$1.55 billion range, which is up from our prior expectations of $1.42 -$1.48 billion. Q3 SG&A expenses of $133.5 million were up 13% compared to Q3 of 2020, primarily due to the impact of short-term pandemic-related cost reductions in Q3 of last year. We continue to expect 2021 total SG&A expenses to be approximately $0.5 billion, including approximately $90 -$95 million of depreciation and amortization. Our Q3 income from operations was a quarterly record at $310.8 million, up 85% versus Q3 last year, and our adjusted operating margin of 36.8% was up 820 basis points compared to last year and up 510 basis points from the pre-pandemic quarter of Q3 2019. Q3 interest and other expense totaled $16.7 million, up approximately $9.2 million versus Q3 last year, due primarily to the impact of currency revaluation. Q3 results included a $3.8 million loss on currency revaluation compared to a $3.3 million gain in Q3 last year. Interest expense was also up $1.2 million due to the higher average debt balance. Our Q3 tax rate came in at 16.0%, our second lowest tax rate on record, which was only eclipsed by the 15.1% rate from Q3 last year. This year's Q3 rate was lower than our expectations, primarily due to the favorable mix of foreign earnings and U.S. tax incentives. We are now expecting our 2021 full-year effective tax rate to be 18%-19% compared to our prior estimate of 20%-22%. Q3 net income was $247.1 million, up 81% compared to Q3 last year, and diluted earnings per share was a quarterly record at $1.85, up 85% versus Q3 last year. Turning to cash flow. Q3 cash flow used by operations was approximately $74 million compared to $169 million used in Q3 last year. Sequentially, cash flow from operations declined by $223 million, driven primarily by a $679 million sequential increase in accounts receivable and contract assets, and partially offset by a $267 million increase in total accounts payable and the $247 million in net income. In Q3, accounts receivable and contract assets were up 19.6% sequentially, while total revenue was up 13.2%. The resulting 3.9-day increase in days sales outstanding, or DSO, was driven primarily by the mix shift associated with higher revenue growth in global forwarding, where our DSO runs approximately double that of our NAST business. While our accounts receivable balance has grown, we are not seeing quality issues as our percentage past due and credit losses have both improved compared to our three-year averages. Over the long term, we expect AGP growth to outpace working capital growth. Capital expenditures were $22.7 million in Q3, up from $15.2 million in Q3 last year. We now expect our technology-driven 2021 capital expenditures to be $70-$80 million, up from our previous expectation of $55-$65 million. We returned approximately $237 million of cash to shareholders in Q3 through a combination of $168 million of share repurchases and $69 million of dividends. That level of cash return to shareholders represents a 230% increase versus Q3 last year when we were not repurchasing shares out of an abundance of caution due to the pandemic. During Q3 this year, we repurchased approximately 1.9 million shares at an average price of $90.58. At the end of Q3, we had approximately 3.2 million shares of capacity remaining on our 15 million share repurchase authorization from May of 2018. Our cash balance at the end of Q3 was $203 million, down $41 million compared to Q3 of 2020, and we continue to work down our cash balance through efficient repatriation of excess cash from foreign entities, with the end goal of carrying only the cash we need to fund operations. We ended Q3 with $571 million of liquidity, comprised of $368 million of committed funding under our credit facility, which matures in October 2023, and our Q3 cash balance. Our debt balance at quarter end was $1.73 billion, up $633 million versus Q3 last year, driven primarily by increased working capital and share repurchases. Our net debt to EBITDA leverage at the end of Q3 was 1.39 times, up sequentially from 1.25 times at the end of Q2. From a capital allocation standpoint, we continue to be committed to disciplined capital stewardship, maintaining an investment-grade credit rating, and generating sustainable long-term growth in our total shareholder returns. Overall, our NAST team made progress towards our truckload volume growth expectations. As you saw in Q3, the percentage increase in price per mile was higher than the percent increase in cost per mile for the first time in nine quarters. While there is no telling where the market is headed, inflections like we saw in Q3 have historically led to periods with our highest AGP margins. The global forwarding team continued to generate significant earnings while building on a solid foundation for future growth. The expanded global team with upgraded tech and more uniform operations across the globe is now onboarding its strongest pipeline of new customers. Thank you for listening this afternoon, and I'll turn the call back over to Bob now for his final comments. Thanks, Mike. I'll take a couple of minutes here and wrap up our prepared comments before we turn it back to the operator for our live Q&A. I believe that our results once again this quarter continue to demonstrate that our model is working and that our strategy is sound. There's no question that we're in a time of unprecedented supply chain disruption across the globe that reaches virtually every mode of transportation. I believe that Robinson continues to be uniquely positioned to help customers not only navigate this environment, but to succeed in this environment. None of us know exactly when the cycle is going to begin to turn or how long it will last. With everything that we see today, we believe that this cycle will in fact extend due to the global constraints around adding capacity and labor while demand remains strong. I certainly don't believe that having 70 ships anchored in Los Angeles is by any stretch the new normal. I also don't see us reverting to a market resembling 2019 anytime soon. As referenced on slide three of our earnings deck, one of the pillars of our Tech+ strategy is our people. Our customers continue to tell us that our team around the globe are the people that they rely on. As I've said before, I believe that the people at Robinson is the most capable team of supply chain experts in the world. I'm incredibly proud of how this team has continued to help thousands of customers navigate this environment while also delivering record financial results for our shareholders. You know, these past couple of years have been stressful times to work in a supply chain. In many parts of the world, we continue to work in a primarily remote environment. We're certainly hopeful to start getting more people back in the office into a hybrid model as soon as we begin to see the Delta variant begin to fade. You know, solving for the complexities of today's supply chain issues is not a nine-to-five job. It's 24/7, 365. I want to again recognize and thank our people for the great work that they're doing. In a time where labor participation rates are low and companies across the globe are challenged to add team members, we were able to grow the size of our team to support our customers and to fuel our future growth. People are choosing to join Robinson today because of the strength of our global brand and the opportunities that we offer for both personal and professional growth. As I close out my prepared remarks, I'd like to reference slide six in our earnings deck. For those of you that have been following us for a while, you know that a decade ago or so, we were primarily known as a North American truckload brokerage company. In 2012, we had a belief that strategically it would be important for our future to have a more balanced portfolio of services. We believed at that time that supply chains would continue to become more global, and that if we had a strong global forwarding business to complement our industry-leading North American surface transportation business, we could really hold a unique position in the marketplace and bring a more comprehensive solution to life for our customers, which would in turn drive growth by connecting supply chains across the globe. We also believed that if we executed that effectively, we could create a business with operating margins in line with other industry-leading forwarders that could help us to offset some of the cyclicality in our core truckload brokerage business, and we could deliver more consistent results to our shareholders. At that time, prior to the acquisition of Phoenix International, forwarding represented around $150 million of adjusted gross profit. I guess at the time we called it net revenue, and that was less than 10% of our enterprise net revenue and contributed very little to operating income. Since that time, we've made a string of strategic acquisitions in the forwarding space, and we've delivered strong organic growth and execution while creating a single global operating model supported by our Navisphere technology platform. Today, we're the number one NVOCC in the transpacific eastbound trade lane and a top five NVOCC in the entire global ocean freight industry, while we've also driven strong growth in both air and customs. Our successful execution of this strategy, along with favorable tailwinds in the marketplace, has allowed us to deliver on a trailing twelve-month basis over $944 million in global forwarding AGP and $422 million in operating income. Global forwarding now represents 37% of our total company AGP for the past quarter, while we delivered 97% growth in AGP and an operating margin of over 53%. In looking at the left side of that slide, we can zero in on NAST a little bit. We've stated that we'll continue to pursue profitable market share growth within this business, which we achieved again this quarter. Volumes increased both year over year and sequentially. Within NAST, we've spoken extensively about our investments in technology as we transition to more of a digitally led company. You can see here the multiple proof points where our advances in technology and the evolution of our business process are driving successful outcomes. Our NAST business is healthy today, and the pace of evolution to our business model continues to accelerate. In today's environment of global supply chain disruption, customers are looking for solutions that span the globe and cross all modes. An ocean freight solution alone doesn't solve for the problem that customers are facing. Neither does a standalone truckload or an LTL solution. We continue to be uniquely positioned to serve customers during this time of disruption and beyond to orchestrate end-to-end supply chain success for these customers. Just as we believed in 2012, we continue to believe today, our ability to deliver a global suite of services fueled by great people, supported by industry-leading technology and an information advantage that's unmatched due to the scale and the $26 billion in freight under management that we have matters. I'm confident that it's going to continue to drive our growth in the future. Going forward, we're going to continue to leverage the strength of this diversified non-asset-based business model that delivers strong returns on investment, invested capital. We'll stay the course with our strategy of pursuing market share gains that align with our profitability expectations, and we'll continue to invest back into the business to drive innovation, improve service to our customers and carriers, and to drive growth across all of our global suite of modes and services. This concludes our prepared comments. With that, I'll turn it back to Laura for the live Q&A portion of the call. Thank you. In order to let as many people ask questions as possible, we ask that you limit yourself to one question. As a reminder, to ask a question, please press star one on your telephone keypad. Your first question comes to the line of Thomas Wadewitz with UBS. You may proceed with your question. Yeah, good afternoon. You know, congratulations on the great results in forwarding in particular. You know, it seems like you're really taking advantage of the market and doing well. I guess, I mean, my question is on NAST. It's, you know, you give a lot of good stats on technology and how you're getting traction on that. But it seems like it's not necessarily translating in terms of, you know, I don't know if it's net revenue growth or operating income, but it seems like there's a little mismatch between how well you're doing with the technology and how that's flowing through in terms of just the growth or, you know, kind of profitability in NAST as well. I don't know if you have any thoughts on that, in that relationship in NAST, and maybe just relative to the strong brokerage market. Thank you. Sure. Thanks for the question, Tom. You know, I guess I'd maybe reiterate my closing comments there, and we tend to look at the sum of the parts here, and we feel pretty good about the fact that we just delivered enterprise operating margins that are the highest that we've delivered since the Q3 of 2016. You know, specific to NAST, there's really two things at play there. The first, you know, is the increased investment in technology and the investment that goes with that, whether it's expense or capitalized, you know, comes prior to some of the benefits that we've gained. We're a couple of years into this journey of increased investments, and we haven't fully harnessed the impacts to the business from those because we're continuing to drive adoption both internally and with our carrier partners. You know, we talked a lot about connectivity, and connectivity is really, to me, the thing that eliminates the friction, you know, from these transactions and allows us to drive greater efficiency. When I think about our transactional pricing engine being up to the level it is, some 85% year-over-year, that's a great example of us taking friction out and driving better outcomes. The second area that is weighing on the operating margins today is still the higher level of negative loads in our truckload business. You know, while we improved that on a year-over-year basis by about 390- basis points or about $12 million, it was pretty consistent from Q2 into Q3. You know, not that you can just net out one variable, but if you netted out those negative loads, and they looked more like historical averages, you would see operating margins that look very similar to what we've experienced in the past in NAST. Do you think that there's an acceleration coming? Like, just when you talk about the spot loads and the technology, is it reasonable to think that accelerates at some point looking forward, or is that the wrong way to look at it? I would believe that we're seeing some of the acceleration right now. I mean, when I show an 880- basis point spread between headcount and volume growth, that's per person per day. I think that's an important proof point of the productivity that we're gaining. You know, the automated bookings is something that we've talked about consistently, you know, arguably, and I would venture to guess the number of automated bookings that we have there, 340,000 in a quarter likely exceeds any of the quote unquote digital upstarts in terms of their total load volume for a quarter. I do think that we are making progress here. The biggest weight and the biggest drag on operating margins relative to past quarters has been those two factors of the increased technology investment and the negative loads on truckload. They're two things that we anticipate, you know, gaining better value from that technology as time goes on, as well as, you know, narrowing the scope of those negative loads as markets continue to settle. We'll reprice about half of our contractual truckload base in Q4 and Q1 of this year. You know, I really see the market going in a couple of different directions. If you know, take scenario A, we maintain at this kind of current status of tight markets at elevated prices. If that's the case, then we'll reprice accordingly, and we should eliminate some of those negative loads and settle down at a certain net revenue or AGP per shipment. The other side of that is that, you know, potentially the market starts to cool down, and you see margin expansion in that model. I don't anticipate that we're going to continue to see, you know, year-on-year increases at the same rate that we have over the past couple of quarters in terms of cost of purchased transportation. Our next question comes on the line of Jordan Alliger with Goldman Sachs. You may proceed with your question. Yeah, hi. Just curious, just taking a spin on the freight forwarding side of the equation, which obviously continues to do quite well. You know, there's questions, of course, on sustainability. I'm just sort of curious if you could talk to your thoughts on whether it be operating margin in that segment, the tightness in the supply chain, how long that could potentially linger and drive these upside gains. Maybe more importantly, once the frenzy does die down, do you feel between market share and gaining new customers, are you at a new platform level so that even if things do die down, we're not dropping back to sort of earlier pre-COVID type of levels in terms of base level profitability? Thanks. Yeah, I don't see us going back to the base level of profitability that we demonstrated pre-COVID, pre-pandemic, call it the 2018, 2019 levels. I think we've done a lot. The team in forwarding has done a lot to engineer their cost structure in such a way that we can deliver improved operating margins over time. You know, we've cited the target of 30% operating margins in that business. We haven't updated our guidance around that point, but, you know, we've certainly shown that we've got the capability of delivering operating margins well in excess of that. You know, I won't try to, you know, forecast how, where, or when this cycle on the forwarding side ends. You know, there's been a lot of conversation here as of late around ports and, you know, keeping some select ports open 24/7. You know, that is one node within the overall supply chain, but it is not, you know, while it's an important one, doing that alone isn't going to solve for this. You know, I think we have a certainly domestically, but potentially globally, a real challenge with labor participation. You know, truck driver shortage, warehouse labor shortage, port labor shortage, rail yard labor shortage. I mean, this labor issue permeates throughout the entire supply chain, and it's really driving fluidity out, which, you know, causes many of these backups. I don't know what the magic bullet is, so to speak, that solves for that, Jordan, but I do believe because labor sits at the center of this in virtually every single node, that it's going to be slow to develop. You know, you look at inventory to sales ratios, and clearly, you know, there's a lot of demand pent up behind that in order to get to more normalized levels there. Again, I won't try to prognosticate when and how this ends, but I do believe that it's going to extend for quite some time. Thank you. Our next question comes from the line of Jack Atkins with Stephens. You may proceed with your question. Okay, great. Thank you for taking my question. I guess, Bob, going back to the reference in the slides around the 340,000 fully automated bookings in the quarter. One, is there a way to kind of quantify what percentage of your truckload shipments that represents? I guess secondly, you know, do you feel like that you're at a point where you can really kind of see the bottleneck around capacity procurement that really, I think it's fairly been historically labor intensive. Are you starting to see technology breakthroughs there that can allow you to accelerate those fully automated sort of communications and bookings with your carrier partners? I'm curious if you could maybe talk about that because it seems like that's an opportunity to really accelerate, you know, the automation within the system. Yeah. I think how I would quantify that, and I won't comment on the percentage of total, but just note on a year-on-year basis and sequentially it continues to grow in kind of a hockey stick, you know, up into the right, the good kind of chart, right, up into the right, unless it's expense. I think that the way that I would quantify where we sit today on this journey is I think we've captured the low-hanging fruit, right? I think we've captured the early adopters in the carrier community. I think we've captured those that more naturally want to interact with us, you know, in a fully automated way. You know, there's a lot of things coming down the pipe in terms of greater adoption of, you know, booking APIs. This isn't just all about a mobile application, right? This is looking and meeting our carriers where and how they want to interact with us and trying to drive friction out of every step of that process. I would say, Jack, that the next six to nine months for us are really, really critical in this journey, and that I would expect for us to really deliver some strong results related to this carrier procurement automation over that time period. Thank you. Our next question comes from the line of Jason Seidl with Cowen. You may proceed with your question. Thanks, operator. Good evening, gentlemen. I want to stick to the forwarding side of the business here. You know, clearly doing a great job. You're throwing up some fantastic revenue growth. As we look to the back half of the year, you know, what type of scenario can we see revenue growth in as opposed to it just might fall off because we have just unheard of comps right now? I think the thing that gets me really, you know, feeling good about our forwarding business is, you know, it is so grounded in really strong volume growth. I mean, obviously, there's been improvement in adjusted gross profit per shipment. But, you know, when I look at our growth this quarter of 12% in ocean and over 50% in air, you know, we think that there's some staying power to that. Our customer. We have several large opportunities and a very robust customer pipeline of opportunities that we've yet to implement. You know, customers that we've come to agreements with, where we're going to, you know, take over portions or all of their forwarding business, where we've yet to implement large chunks, for lack of a better term, of business. We think the pipeline's robust. Again, the macro market conditions are going to dictate some of this, but the growth trajectory for that business, we feel really strongly about. To be clear, you do think there are scenarios where you can grow your revenue in the back half of the year? You know, Jason, after the Q2 of last year, we all sat here and said there's no way that we can grow airfreight revenue off of a 104% growth rate in Q2 of 2020, and we did. We continue to, you know, grow really strong and deliver strong results on top of some really difficult comps. So based on where we sit today, looking, you know, into the quarter, we think it's realistic to expect that we can deliver growth. We can continue to deliver growth in that business. Wow. That's great color. Listen, nice quarter. Appreciate the time. Appreciate it. Our next question comes from the line of Todd Fowler with KeyBanc Capital Markets. You may proceed with your question. Great. Thanks, and good evening. Bob, I wanted to ask on slide nine. I think that Mike made the comment, and we've got this in our model. This was the first time in nine quarters when your sell rate exceeded your cost of hire. Can you just talk a little bit? I mean, is that the contract renewals and repricing work that you've done here this year? Is that a greater ability to pass through some of the higher spot rates that you're seeing just because we've been in this market? As we think about, you know, this chart and this curve, you know, what would be the reason why this isn't sustained going forward, which as you pointed out, is typically a good environment for you on the AGP side? Yeah. It's you know, if you look at the actual cost of hire within our business and you look at it sequentially week by week, and the actual customer pricing, we have started to see that flatten out, right? In terms of, you know, dollars per mile that we're billing, dollars per mile that we're paying. You know, we're not experiencing the week-to-week volatility of these increases and decreases. Yeah See, we found things, you know, kind of flattening out at a much higher level. We've delivered the change there based on, you know, the opportunities that we've taken in the spot market and also the selective repricing activities that we've done within our contractual portfolio. You know, we've continued to take the long game on our contractual strategic customers, right? You know, there are customers, I can tell you, within the portfolio today that in the Q3, we lost maybe 20% of their loads or 25% of their loads. They're really important customers for us that have been with us for 20 years that we know we have an opportunity to reprice the business with them in the Q4. You know, some might say we should have been really aggressive in the Q3 to go in and whack those losses in order to drive those losses out in the short term. We believe that would have a very negative implication for us in the Q4 and moving forward for the next four quarters. We continue to take, you know, the long game with those customers. I do expect to see this type of trend continuing in that difference in the year-over-year change in rate and cost. If we can get this, a more stable, you know, tight market, I think we have that opportunity. Yeah. Okay. That makes sense. Thanks for the time tonight. Yeah. Thanks, Todd. Our next question comes from the line of Christian Wetherbee with Wells Fargo. You may proceed with your question. Hey. Thanks. Good afternoon. Maybe wanted to zero in a little bit on NAST operating expenses and maybe just get a sense. I'm guessing there's probably some incentive comp that's in there based on the business that you're doing in the quarter. want to get a sense of, I mean, how to think about that going forward. It was a nice step up from the Q2 to the Q3. I guess it, you know, I think adjusted gross profit per load was at a high level, and it goes above your longer term averages. When you look at sort of an operating income on a per load basis, how does that compare? I just want to get a sense of whether you're actually getting that leverage dropping to the bottom line, because I know heads are growing slower than volume, so I would have expected that relationship to be a little bit more favorable. I just want to make sure I'm not missing something there. Yeah, Chris, let me take that. On our NAST business, you know, we have increased heads slightly in that business, and that's really as we've looked at procuring capacity and making sure that we're taking bottlenecks out of the system. We've taken up heads to get ourselves aligned with where we feel like long-term growth is there. That's a little bit of the increase. But, you know, we're also seeing, you know, increases because of personnel expense and, you know, that is on the back of incentive for the most part. And that's, you know, where our folks are paid an incentive on enterprise results. We're seeing a pretty significant increase overall. If you take that question to the enterprise level, you know, we showed you the personnel expense up $97 million. You know, over half of that was incentive. You know, an inside incentive is equity, it's commissions and bonus. You know, then, you know, probably also should note, true to NAST and to the enterprise, you know, another quarter of that increase year-over-year in personnel expense is a result of short-term savings that we had a year ago. Obviously, we didn't expect those to continue. Getting back to the more normalized level, you know, that's a little over a quarter of that increase, and then headcount makes up the difference there on the personnel side. We think we're in better position now going forward, but as we roll into next year, you know, those outsized incentive payments will be a tailwind for us as we get back to targets. Operating profit per load can probably start to ramp up in that scenario. Yeah, really depends on what happens on AGP, but, all things being equal, yep. Thank you. Our next question comes from the line of Scott Group with Wolfe Research. You may proceed with your question. Hey, thanks, guys. I just want to follow up there so I make sure I'm understanding. In the Q3, NAST net revenues up sequentially, but the NAST earnings were down sequentially. It sounds like you think that that's more of a one-off, and going forward, if NAST net revenue is growing, earnings should be growing. Is that the case? Do you think we start to see that normal relationship starting to come through? Yeah, over time, we would expect the growth of operating income for NAST to grow at a rate ahead of net revenue or AGP growth. Okay. If I can just ask a strategic one. Like, I'm just not sure you guys are getting much credit for your forwarding business. I guess I'm wondering, other than talking about it more, what you do about it. We've also got a really active M&A market. How do you think about either being an acquirer, maybe selling businesses? I don't know if any thoughts you may have there. Yeah, I appreciate that. I appreciate that question. I mean, clearly, we're continuing to look at, you know, companies, you know, in the marketplace from an acquisition perspective. You know, as I've alluded to in the past, they've got to meet some certain criteria, right? We want them to fit into our culture. You know, we really like the business that we've built in forwarding through organic and inorganic growth. If we've got the opportunity to continue to expand our geographic presence in that business, to add additional capabilities, you know, to add density to specific trade lanes, any way that we can build scale, we're you know, committed to looking at those opportunities. You know, in terms of some of the other strategic alternatives that you mentioned, I, you know, I'm not in a position today to comment on some of those, but really our goal today has been about growing that business versus any of the other alternatives that you brought up. Okay. Thank you, guys. Appreciate it. Our next question comes from the line of Bascome Majors with Susquehanna. You may proceed with your question. Yeah, thanks for taking my question. You know, just to follow up on Scott Group's questioning there. You know, as an acquirer, could you discuss whether or not buying a U.S.-centric truck brokerage makes more sense today for some reason compared to in prior years? You know, I know you can't comment on specific M&A speculation, but if you could give us some thoughts on how the board perceives any approach that you guys receive, what you have to go through and what your obligations are, you know, as a target, that would be helpful. Thank you. Yeah. Bascome, I'll do my best to try to answer your question, but I won't go real deep into it. I'll address the first part of it in terms of, you know, would we consider the acquisition of a domestic brokerage? You know, the term domestic brokerage, I think, has evolved a lot over the course of, you know, the last decade or so, certainly since 2014, 2015. I don't know, you know, there isn't really a one size fits all. I'd go back to kind of the same, I guess, guidelines that I shared with the previous question, which is, you know, one, it's got to be a strategic fit, culturally and fit nicely within Robinson. There are opportunities to potentially enhance technology or drive growth or think differently about how we transform ourselves through acquisition. You know, the great thing about being C.H. Robinson is we do get a look at virtually everything that's in the market, at least at a cursory level, and we can determine, you know, what level of interest that we want to display in those assets. You know, I think strategically, our acquisition strategy is not going to be driven by what's readily available in the market. It'll be driven by the strategic needs of our business, and we will go out and seek those opportunities inorganically if we choose for that to be the right path, and we'll control that process. The question around the board's obligations and process if you're approached? Yeah. I mean, I would just briefly answer that to say, assume that we have the appropriate governance mechanisms in place that if we were approached, that there would be a process in which we would work through in order to maximize the value for our shareholders. Thank you. Our next question comes from the line of David Zazula with Barclays. You may proceed with your question. Thanks for taking my question. I guess, Bob, you have a number of competitors that have touted success in the power-only brokerage line. Do you feel this offering is impacting your business in any way? If so, how are you adjusting the business accordingly? It's a great part of our business. You know, we launched our Robinson Power Plus program, I think, probably five years ago, and it's been a really fast-growing part of our business. You know, we've taken a very customer-centric approach to it where we're, you know, about 10% of the business that Robinson manages in NAST today, a little bit north of 10% is drop trailer, where we're doing, you know, drop trailer loading. We've kind of taken two approaches to that. One being kind of the rainbow fleet, where we aggregate, you know, trailer pools on behalf of a bunch of smaller carriers and establish interchange agreements between them. The second, probably more fast-growing is that power plus piece where we've got trailers either that we're leasing directly or that carrier. We have leasing agreements with carriers, and we're moving those trailer pools around specific corridors between specific customers. It allows us just another opportunity to look and feel like an asset for some of our customers who have very specific needs around trailer pools, and it's a fast-growing piece of our overall business. Our next question comes to the line of Ken Hoexter with Bank of America. You may proceed with your question. Hey, good afternoon. Probably, you know, solid job on the quarter, but I guess maybe just two small questions. You know, one is the CapEx that you're spending. I just want to understand, is that targeted to scaling the take rate on the digital brokerage? In other words, is that looking to regain market rates in terms of share gains? And then on the ocean side, a smaller one, just given rates have scaled so much on the ocean side, it's actually collapsed. It looks like the differentials between ocean and air from maybe 10-15 times to five times. Is that? Are you starting to see scaling on the air side or is that gap, you know, maybe bringing more of that swapping into the equation that you talked about? I'll take the air freight question, and I'll throw it to Mike to talk about CapEx. You know, we have seen tremendous growth in our charter business. Ken, I think it's you know, to your point, when you've got container rates that go as high as they have, you know, all of a sudden charter starts to look a little bit you know, more feasible. I do think some of that spill over from ocean to air is what's driving some of the growth certainly that we're seeing on the air freight side. I'll let Mike talk about the CapEx. Yeah. Ken, on CapEx, you know, we took our guidance for 2021 up to $70 -$80 million, and, you know, we were at $55 -$65 million prior to that. You know, our CapEx spend is almost entirely a tech spend. You know, we've got money to deploy there when risk-adjusted returns are high. We like when we're seeing a better flow of great projects, and we certainly prioritize those amongst our capital allocation plans when we see them. You know, in my book, a higher CapEx spend is encouraging because it means that the pipeline that we have of projects with nice returns out into the future is stronger. Yeah. I maybe just add on, you know, maybe more directly to your question. Yes, a lot of that is directed towards scaling the digital platform for truckload and the truckload ex-freight exchange. But there are a lot of other high returning projects that we've got in flight there, whether that be in our LTL business to enhance and manage yield and better connect with some of the capabilities of our carriers, to, you know, continue to strengthen the global platform and global forwarding to drive operational processes. So there are a number of things in flight there that bring benefits to different parts of the business. Thanks, Bob. Thanks, Mike. I appreciate the time. Yeah, thanks, Ken. Our next question comes to the line of Cherilyn Radbourne with Evercore ISI. You may proceed with your question. Good evening. Thank you for taking my question, and congratulations on the great result. I wanted to talk about the collaboration with SPS Commerce. How should we be thinking about this partnership with regards to automation and incremental volumes within LTL? And then from a broader perspective, any commentary you could give on how you're positioning for the holiday season in such a tight trade environment would be appreciated. Thank you. Yeah. Thanks, Cherilyn, and welcome to the call. Thank you. We're early, we're early innings, obviously, with the launch of the SPS Commerce partnership. I think we just launched that early last week and kind of looking to check here, you know, 7 to 10 days ago. I wish I had a whole bunch of, you know, revenue results that I could share with you, but since it's within the quarter, I wouldn't share them even if I could. I think the really neat thing about this partnership is SPS Commerce is a leader in their space. I mean, they've got over 95,000 customers that are on their platform that they're connecting, you know, directly into the retail ecosystem and managing the flow of information. It's such a natural marriage and a natural partnership given our strength in retail and food and beverage and having, you know, such deep knowledge of that space. Our ability to be the LTL provider and help the customers, the shipper customers of SPS Commerce access that LTL marketplace in a fully automated way, I think is a real win for the customers of SPS. It's an incremental opportunity for us, and it helps them to strengthen their product portfolio and allows us to, you know, tap into an entire group of customers in a new and exciting way. We continue to look at alliances and partnerships across the supply chain landscape for opportunities such as those, which is just another example of us extending the ecosystem and pursuing some of these digital initiatives to drive growth. You know, in terms of positioning for the peak season, it feels as though we've been in the peak season here for a number of months, maybe quarters, quite frankly. You know, our job is to be really agile, to work with our customers, to help them navigate the unknowns, to be mode agnostic, to help them move, you know, whether it be moving ports, moving modes, you know, collaborating with other shipper customers to drive, you know, greater utilization. We just, you know, we work really closely with our shipper customers to help them be successful in this environment in a number of different ways. As I said, it's 24/7, 365, and our team around the globe, you know, is doing their best to help navigate this. Okay, great. That's really helpful. Thanks for the clarity. Our next question comes from line of Jeffrey Kauffman with Vertical Research Partners. You may proceed with your question. Thank you very much, and congratulations on a very strong quarter. I wanted to focus a little bit on the forwarding. This morning UPS reported, and they had discussed about how procedures related to Delta variant out of Asia impacted shipments coming out of that region. I was just wondering, did this impact your forwarding business? Was the net of that impact a positive or was the net of that impact a negative? The net to service just overall, I would say on the water has been a negative. I mean, if you think about the current environment in ocean freight right now, you know, there's only about 2.5% of the active fleet or of the ocean freight fleet that isn't active right now, right? It is literally at full capacity. Service reliability on the water has never been lower than it is today, and that's to no fault of the steamship lines. It's clearly just an amalgamation of all these supply chain issues. As we saw issues in Asia related to COVID, what you started to see was either plants shutting down, ports shutting down, ports being, you know, not called on for a period of time because the ships would go to another port. It just further exacerbated the delays that were occurring in the global freight cycle. You know, I can't quantify a number in terms of impact to earnings or impact to volume. Both of them clearly were very strong for us sequentially and year over year. Clearly it caused additional disruptions and delays in the supply chain. Okay. You would benefit from that, I guess, in some ways, where customers would need solutions. On the other hand, you're probably moving a little less volume across the ocean than would otherwise be. But no view of whether that was net positive or net negative to the company. Not in a meaningful way in sum of all the results. Okay, great. That's my one. Thank you very much. Thanks. Your last question comes from line of Brian Ossenbeck with J.P. Morgan. You may proceed with your question. Hey, good evening. Thanks for getting me on the call here. Appreciate it. Bob, just want to come back to maybe get your closing thoughts on balancing volume market share and margin, however you want to measure that in AGP per load, I assume. You know, I would have thought we would have seen the negative files maybe at least improve sequentially or maybe not altogether just gone at this point, given just how strong the market is. I appreciate the comments that, you know, these are good customers, but, you know, won't they share in some of the disruption and the cost that you're seeing here? Maybe you can just stress that one more time for me, and then if you want to weave in some comments on how you think this cycle is going to change these relationships going forward, maybe more shorter contracts, more visibility on pricing and indices. You kind of mentioned already, but it sounds like despite all this, you're still looking at two-thirds of your book annual. Appreciate any thoughts there. We'll start with the negative files. Here's how I think about this. I think our managed services business is a great proxy for just kind of what happens in the contractual marketplace. What we've got? $6 billion or $7 billion in freight under management today in that managed services business. It's just a great proxy for the contractual marketplace. If I go back to Q4 of last year and call it, you know, October, September of last year, all the way through today, we've been in this extended tight trucking environment. Presumably there's been all sorts of bids, mini bids, repricing, reshuffling of routing guides, you know, and not just with Robinson or other brokers, but all the asset guys and everybody that's involved in the domestic surface transportation trucking business has had some sort of movement in their pricing and in their commitments and all of those things in contracts. There has been virtually no improvement in routing guide depth of tender over that 15 months. It's been 1.7, 1.6, 1.7. I think our, you know, kind of consistent negative vibes is somewhat analogous to that in the fact that the market just continues to reset. You know, we seem to be on it. It is flattening out, but we've been on this consistent year-over-year increase in cost. You know, part of our model, good or bad, is that we, you know, typically, you know, we sell long and we buy short. When we consistently see that upward pressure on cost of hire, we're going to have a higher occurrence of negative files. Now, clearly, this is the highest it's been, and we expect that we'll, you know, we'll draw it down. But I think that's a bit of where we are. I would be very disappointed, you know, if after the Q4 or into the Q1 of next year, once we start repricing, if we're still having this conversation about negative files being at the same level. I expect that they will come down both sequentially and year over year. In terms of some of the contract terms, yeah, I think two-thirds of our business is still on 12-month, you know, 12-month terms, which is kind of what it is. But a third of our contractual business being on, you know, something other than 12-month terms is new to us, and I think it's relatively new to the industry. You know, pricing transparency continues to be an important thing that we focus on. Whether it be, you know, the Market Rate IQ product that we launched during the quarter to give shippers visibility to how they're performing compared to industry benchmarks, but also visibility to some of their behaviors and how their behaviors are impacting the rates that they pay is probably an important exercise for us to be consultative and help them to realize their behaviors and how they can be more effective, right? Because rate per mile, you're not going to be able to negotiate it down per se very easily today. Our, you know, dynamic pricing engine that we've talked a lot about is another way for us to provide real-time, you know, real-time pricing to customers that keep them out of the, you know, kind of the dog eat dog spot market. We provide, you know, kind of an intermediate step between that guaranteed committed contractual business and not allowing them to fall all the way through their routing guide. We're spending a lot of time on trying to deliver innovative pricing solutions that are good for us and good for the customers. That annual contract still has held up to be the main mechanism for us to, you know, price contractual freight and the main mechanism in which customers are requesting it. You think that would hold pretty much through next year as well based on where your conversations are right now looking into 2022? I don't know that I've got a clear view. I mean, looking into Q4, I can tell you that that appears to be the case, but looking out beyond that would be speculation I wouldn't be comfortable making at this point. All right. Thank you, Bob. Appreciate it. Yeah, appreciate it. That concludes today's earnings call. Thank you everyone for joining us today, and we look forward to talking to you again. Have a good evening.