Okay, we're going to get started with the next presentation and Q&A. Again, I'm Brian Ossenbeck at Cover Transport and Logistics for JP Morgan here. Very excited to have C.H. Robinson. We've got Dave Bozeman, President and CEO; Damon Lee, CFO; and Chuck Ives from Investor Relations. I'm going to just give it over to Dave just briefly here to make some intro comments, and then we'll get to some Q&A. We've got a big list, but if anybody wants to raise their hand and join in, we can try to get you a mic as well. Thanks very much for coming, guys. Dave, I'll turn it over to you. Yeah, thanks, Brian. Thanks first of all, thanks for having us, and congratulations on this conference. I think you guys went from 650 to almost 950 this year, so a really big step up in attendance, and glad to be here. A couple of things for us just to start off: there's a lot going on in the world right now, and certainly in the markets. I think, you know, we're obviously right on the coal face, is what I'd like to say with that. I would also say that it's times like this and others that are really the value prop for C.H. Robinson. You know, we help customers deal with disruption and things that are happening. This is not the first time we've dealt with disruption, whether it's been port strikes or tariffs or anything like that. We deal with over 85,000 customers, and we guide them through a lot of that. Right now, we have a balance sheet that helps our customers. We feel really good about where we are, and our uncertainty is going to happen. At the end of the day, we'll get through this like we have in the past, and I think our customers feel good about that. If you guys saw our Investor Day, we remain committed, really solid plan on where we are, and Damon will go into that as we talk. Strong inclinations going out to 2026, and we still feel really good about that marketplace. At the end of the day, we lean on higher highs and higher lows, and it doesn't matter where the market is. You know, we're into our 37th month of this kind of freight pullback, freight recession, on an 18-24 month normal cycle. It is not normal. This is abnormal. At the end of the day, I think with our asset-light model and how we're doing it, we have the flexibility and the agility to deal with that, and we feel really good about that and look forward to talking about it. All right, thanks very much. Maybe we can start there with sort of the current state of the North American freight market from your guys' perspective. Any signs of life in the spot truckload market? Is this mostly weather, which, you know, I feel like we did this same thing last year: the market improved, people thought it was turning, and then it was weather. Seasonality is a good thing to have back, but it does not feel like we are necessarily off to the races or an inflection at this point. Curious to see what you guys are seeing. Yeah, I'll start. You can jump in, Damon. You know, first of all, I would say that there's no material change yet, Brian, on what we're seeing. You're right to call out there's seasonality. We saw that in Q4. That's normal seasonality. We haven't seen it where it's been steady and starting to go. Now, a couple of things that we watch and we continue to watch, and there's some things that you guys should hear too. When it comes to capacity, that continues to burn down. We like that. It's still burning at somewhat of a slow rate, but it's starting to burn down, and that will eventually get back to normal levels. Because you just can't continue to hold these types of prices and costs that's happening, that's just not sustainable in the long run. We do see that happening. Ultimately, it's got to be a balance still. It's got to be demand plus capacity, and we've not yet seen that full demand yet that would give you that feeling of things just being totally right. I don't know if you want to add. Yeah, I'll just add to that. We did see truckload spot rates increase in December and January. You know, we believe that was certainly on the back of seasonality and weather, because when the weather abated and the seasonality was over, we saw the rates come right back down again. Rates are right now below the operating cost of most carriers, right? I think that's obvious that that's unsustainable, and certainly, you know, rates are not sustainable where they're at today. We still believe rates will increase throughout 2025, but we have not seen a sign of any structural change in rates, you know, thus far this year, coming out of Q4 and into Q1. I would say there is one bright spot, which is when we do have seasonality and we do have weather events, we are seeing tension in the carrier capacity market. That is a good sign that at least some of that excess is starting to leave the system. I think that is kind of a first indicator of, okay, there is some tension when there is irregularity in the marketplace, so now we just need more of that base capacity to exit the market. We believe it will. It is just, as Dave mentioned, it is going at a slow pace. Damon, on that point with renewals, you know, it's hard to judge just by one customer or one anecdote, because everybody's got a different base that they're starting from. What's sort of the range of renewals? You mentioned they expect them to go up throughout the year. Consensus still seems to be the back half recovery, which would be third year in a row. Obviously, you're off to a little bit of a slower start, at least from our discussions, but wanted to see if you guys had a different perspective here to begin the year. Yeah, so as it relates to volume, as you know, we don't guide. You know, what I would say is just echo what Dave has said, right, which is it's still a very tough market. Therefore, Robinson's strategy, I think different than Robinson's strategy in the past, has been I'm not going to try to predict where the market's going to go and let that facilitate my success, right? You know, we've coined the phrase higher highs and higher lows, right? That's really how we drive the company now, how we drive our operating model, how we've pegged our strategic initiatives, which is we're going to outperform the market from a volume perspective, regardless of what cycle it's in, regardless of what level it's at. That's boded well for us over the course of 2024. Certainly, to that point, as Dave mentioned, we're in an extremely prolonged freight recession. I think the recession has been predicted to end probably five or six times now in that 37 months. It's kind of a fool's errand to predict when it's going to revert. What we are doing at Robinson is we've got a number of scenarios that we've planned out, right, that says, okay, if the market does this, we're going to react this way. We feel like we're in very good shape, better than we've ever been, to not just deal with the market when it does inflect or if it continues to bounce along the bottom like it has, we're still going to deliver the industry-leading performance that we've been delivering in 2024, regardless of market conditions. I'd say to your point, you know, early 2025, I think it is starting off slower than what most people expected coming into 2025, but I feel like Robinson is prepared regardless of what the market does. Maybe this is a question you ask when you've been in a long trough or freight market, but I do wonder if anything has changed from a market structure perspective over the last couple of years. I mean, you've got more private fleets, you've got greater visibility in tech tools, you've got trailer pools. From your perspective, is any of that stuff maybe causing a longer and more extended trough here at this point, just because there's perhaps more capacity than there was ever before or availability of capacity? Yeah, I think a couple of things on the capacity. Number one, during the pandemic, the amount of capacity that was infused into the system was the highest, as you know, it was the highest amount of capacity that was put in. You know, on the backside of that and burning that down, you know, people can forget like what happened there. There were some pretty good profits made in 2021, and really assets, along with recovery assets as well, as far as pandemic relief and things like that. All of that just added up to carriers being able to pay off assets, and that slowed down the exit of this as well. Trailer pools continued to be out there, and that kind of lengthens the carriers to be able to stay in the marketplace. There has just been a number of different things. The banks really did not want to be in the used truck market. When it comes to trucks having to redo deals, we coined the term zombie trucks that are kind of out there, but there's just a lot of hang-on capacity because of just a number of factors. We're starting to see that continue to break down. It was burning down at about 4%. That went up to about 6%. That is going to get its way down to where it needs to be. I'm pretty confident of that overall. No, I think you said it well, Dave. I would just add that, you know, certainly everything of what Dave just went through actually fits the Robinson business model very well. I mean, what we're seeing from a capacity perspective is certainly more flexibility, more agility is desired in the marketplace, both from assets and brokers. I think Robinson has a very good mix of certainly being the leading broker in the industry and our asset-light business model, which, you know, commands, you know, higher than average returns throughout all the cycles. With that, you know, our strategy in showing up more like an asset allows us to take advantage of some of those market structural changes that you mentioned. I think, you know, our business model, I think our business strategy fits very well to where those market dynamics are going. You mentioned showing up like an asset carrier theme from the Investor Day. What does that mean, and I guess where do you sort of draw the line between owning more? It does seem like there's going to be more of a hybrid model just in general over time with assets getting more asset-light and vice versa. How do you view that within Robinson and sort of if there's a line that you would draw in terms of like what you would or wouldn't own? First of all, we feel good about the asset-light model. We do, and it's helped us out. It's allowed us to have a P&L and a balance sheet that's in the black and allowed us to invest in really times like this. We're able to invest, and I think that separates us from a lot of the marketplace to do that, and we'll continue to do that investment. When we start to look at showing up like an asset, we look at it as our total addressable market. You're talking about a $400 billion TAM. In doing that, some of that would not, for a for-hire brokerage, you really would not get access to some of that TAM unless you showed up like an asset. For us, it's our drop trailer. To put some numbers on this, when we say drop trailer, you know, our drop trailer business represents about 15%-20% of our NAST volume. That is pretty significant of where we are. That allows us to be able to get in bids and really go for volume that normally would have been just shut out in just a traditional brokerage model. LTL consolidation, warehousing, that is another showing up like an asset. That is a significant service that our customers like, that they want, and that we are really good at, right? With LTL. And Brian, you noticed we have said this before. I mean, our LTL business is a $3 billion LTL business. That usually stops people because that is a pretty big scale that we are dealing with. There are a number of things that we do that will be part of our strategy as we continue to move forward and show up like that asset to get part of that TAM. Damon and I watch that on how much. For example, trailers, we own over 2,000 trailers, but we have access to over 10,000 trailers. Now, you know, we're going to have a strict ROI type of process that we go through on how many more we would add to that. It's strictly around that return on that invested dollars. No, I think it's exactly right. Certainly, you mentioned what draws the line. It certainly is the ROI expectations of would we invest in more assets. Certainly, as Dave mentioned, we already own a lot of assets today. I know that's always a fun fact that a lot of people forget about Robinson, but the optionality to partner assets is really a differentiator for us. I think what we've proved out over time is, you know, certainly as we continue to grow, we'll certainly add more assets, but I think that ROI expectation will always show up as the asset-light model is still superior. I think that'll end up being that range in which we play in as far as how many incremental assets we add. When you think about the current conversations with customers, how would you characterize that? Obviously, there's a lot of noise, there's a lot of headlines, there's a lot of back and forth. Any short-term changes that people are making at this point? Are they making longer-term changes? Like, I'm sure it differs by customer and by day, but how would you overall characterize those conversations right now? You're right. It's a lot going on with customers right now and what they're thinking. Listen, at Robinson, we know we have the largest data set in the industry, and we have over 85,000 customers. We see a wide variety of what customers are doing. It's a mix, Brian. Number one, we have some customers that are very strategic on how they're doing this. They're sitting back and they want to be calm, be wise in how they're doing it. We have some customers that are somewhat reacting to some of the things that's happening, but with them, you know, they're having to do a bit of a pause because things are changing somewhat rapidly. I would call it sawtooth. A lot of customers don't like that. If you're dealing with, for example, a potential 25% tariff coming out of Mexico, we're right in the middle of all of that. We do one out of ten shipments coming from Mexico to the U.S. We touch those, we move those. We've had customers, we've seen customers do this, you know, hold a bit on some of their shipments because they don't know if a 25% tariff is going to be relieved or not. We've had to kind of deal with them in that. The same way coming from Canada in, we're a significant player when it comes to moving that product. We're just, we're dealing with those customers on that front and just kind of guiding them. It is a mix. From a pricing strategy, we've had some customers that like to be strategic, and we work with them around potential price increases and have that conversation. We have others that are more transactional when it comes to pricing. We have a way of dealing with that as well through revenue management. The operating model has really helped on that. I don't know if you would add anything. I'll just, you cover the short-term well, Dave. I'll just speak a little bit to the long-term. I don't think what we're coining kind of tariffs 2.0 has necessarily facilitated long-term strategies yet. I think, as Dave said, I think many customers are trying to see if this is transitory and are the tariffs going to stick or they just, you know, leverage to drive some other policy, you know, for the administration. I would say if you go all the way back to the pandemic, I think the customers that were strategic, the customers that used the pandemic as an opportunity to get more strategic about supply chain to build resiliency and optionality into their supply chain, I think those are the customers that are benefiting now because even though it's a different disruption, it's still a disruption, right? As Dave mentioned, I think you've got, you know, a section of customers that went through the pandemic, went through some of the disruptions in the Red Sea, went through tariffs 1.0 and said, "Okay, I'm not going to be caught flat-footed on this again." They put a lot of actions in play, partnered with us on optionality going forward. I think those customers right now have optionality that others don't. As Dave mentioned, there's also a section of customers that operate more transactionally, kind of viewed the pandemic as a one-time event, didn't invest a lot in strategic capability of their supply chain. Now they're kind of wondering, "What do I do?" Right? Because transactional doesn't work when you don't know what tomorrow is going to bring from a tariff perspective. As Dave mentioned, I think it's somewhat bifurcated in our customer space, but I don't think long-term structural changes have occurred due to tariff 2.0. I think they really occurred from the pandemic forward with all the disruptions we've incurred the last several years. Interesting. Okay. Two questions, maybe more specific to forwarding. In terms of the first one, just the de minimis exemption, we've seen it removed and then, I guess, restored. From your perspective on forwarding, would you expect an impact on maybe air freight rates and customs clearing? Did you see any volatility with people trying to get stuff over the border when that was pulled off for what, less than 24 hours? Yeah, I would say on de minimis, for us, it's not really a big deal, partly because that is really dealing with parcel. And we're really not in that business on dealing with parcel. That was really not a big deal overall for us on the de minimis changes. Certainly, it could affect some air freight if, you know, this comes down to shipping pullback when it comes to that, but that's non-material for us overall as a business. Well said. Okay. The other one that might be more material if it goes through would just be the layers of fees that they might charge on vessels either tied to or built in for China. Big topic recently, especially at a recent conference with TPM, but what are you hearing from sort of your partners in that regard? Are they preparing for that yet or is it still a little too early? It seems like it would be a pretty significant event if it were to go through as written, which is, of course, the big question mark if that will actually happen. Yeah. I would say carriers are starting to prepare for that just from an optionality perspective. I would say I think they're looking for ways to drive more efficiency, you know, in their port calls. I think they'll make fewer port calls and try to drive more density in each call. I think that'll help them drive efficiency to offset any of that cost pressure they may incur. I think that'll be one step they'll use to try to abate any impact that may come. I think secondly, which is really what ends up happening with tariffs anyways, is I think they'll end up passing those fees along to the shipper, right? It'll be up to the shipper on what they do with those added costs. Those are the two actions that I think are probably, you know, most front and center on the carrier's minds. We often hear about and are asked about technology in the brokerage industry, and it's always difficult to figure out who has, you know, the best or leading tech from an outside perspective. You know, if you were in all of our seats, how would you sort of address that question? It's a good question. I would actually ask the question differently if we were in a seat because this is really important. From a tech perspective, I think when you look at the amount of tech that's out there in the industry, everyone has some level of pretty good technology in what they're dealing with and helps them run the business. The key thing on that question is, how are you integrating that with your people as a strategy? For us, you know, it's different at Robinson now. We are not, we don't lead and say our strategy is technology. Our strategy is our people enabled by our technology. We think that makes a huge difference than if you just say the technology strategy because we've kind of been there and done that. That one play doesn't work if it's just technology. You have to have this connection between this kind of human in the loop and the technology stack that we feel is the best technology in the industry, but that it's now busted up against the best logisticians in the world. That together is a really powerful combination that allows us, our unit, our operating mechanism to run like it's running, as Damon said, and you're seeing that in 2024. This strategy has worked with an operating model that really produces. I don't know if you. Yeah, I'll only add that, as Dave mentioned, right? I think historically, companies in our industry, even ourselves, viewed technology as our strategy, right? That didn't work, right? To us, the litmus test on do we have the best technology is what results is it yielding, right? Is it giving a better customer experience? For Robinson, we believe the answer is yes. Is it giving a better carrier experience? We believe the answer is yes. Is it driving growth in our revenue? We believe the answer is yes for Robinson, right? Is it enabling margin expansion at the gross margin level? The answer is yes for Robinson. Lastly, is it allowing us to generate operating leverage to drive a more efficient company at the operating margin level? We believe the answer is yes. For us, technology, we have a very high bar for technology at Robinson, right? It goes through, we had the ROI discussion before. We do not do any technology at Robinson unless it has a high probability of success and a compelling ROI. There is really no kind of pie in the sky investment when it comes to technology for Robinson. Just to summarize that, I mean, our key test on do we have the best tech in the industry, as Dave mentioned, we do not think it is the tech by itself. We think it is the combination of our expert people with the tech, which we call human in the loop. We do not think the ends of that spectrum are correct, right? We have seen technology pure plays that did not work in the marketplace, right? We have seen more labor-intensive efforts, and those are proven out to be not competitive in the marketplace. We do believe that optimal combination of people and technology is the right answer for our industry, and we think we have that right formula. One of the big goals, I think, of the operating model in the next upcycle would be to decouple headcount in NAST with volume growth. Maybe working backwards from there, obviously you did in global forwarding already, but are there some steps or project initiatives or successes that you already had that would give you some visibility and confidence to that happening, you know, if and when we actually get to the upcycle here? Yeah, Brian, I mean, one of the tough things in a, we started this conversation out by saying it's 37 months and dealing with that, is we know the case that's been on Robinson is like, "Hey, listen, I always say people are from Missouri." You know, Dave would say, "You got to show me, it's a show me state, and you can't do that unless the market is back, right?" Doing that. We have been debating that and really kind of showing this group and many others, we tend to say that there's a canary in a coal mine. We actually feel like we have debunked that story to say, you know, disconnect headcount growth and volume growth because we've done it in global forwarding. That's a business that makes us unique because we get end to end and it separates us out from the competition. We know that, but this is why we have to talk about it. Our operating model and how we're driving a company, how we're improving it, we take global forwarding through that same operating model, and they've gone through that last year. What was the result? The result was growth every quarter, year over year, while costs went down into the right. Growth up into the right, costs went down into the right, headcount was reduced. If we had not done that, we would have added people and had higher expenses within global forwarding, period. Now you go over and say, "For NAST, we feel that's going to be even a stronger play." Why? We have a deeper technology stack within NAST that we have not yet put into global forwarding, but that's coming. We have processes in place in NAST that we've driven. I think we've talked about our productivity, 15% in 2023, 15% we achieved in 2024, you know, a kind of a CAGR of over 30% of productivity. Now, if there, when the market returns, we feel like that case is already here that you should have confidence that we're going to actually do that within the NAST space, but it'll actually be in probably even a more aggressive way than you saw in global forwarding because of how we're set up in that. I feel super bullish on where we are, and I feel like we've debunked that, but I understand, again, the market isn't here in NAST, but just look at what we've done in global forwarding. Yeah. Could I add to that? Because this is a topic Dave and I are extremely passionate about. Just a few more specifics on what global forwarding actually did in 2024, right? We grew revenue year over year in 2024 while reducing headcount 10%, while generating more than 15% productivity, right? That is the bare thesis debunked for global forwarding. As Dave mentioned, all of those operating cadences, all the discipline, all the rigor that allow those results to be generated for global forwarding are in place for our NAST business, right? I would argue from a technology perspective, we've over-indexed to NAST, right? We have a better technology stack in NAST than we do in global forwarding, which is just going to further enable that probability of success going forward. The one thing we keep driving home is, you know, there's two things that will prevent us from adding headcount back from a NAST perspective when the market recovers. The first one is we have fundamentally changed those processes, right? Those processes now don't require the same amount of headcount that they did before, right? The process itself fundamentally changed, right? Continuing to follow that process, there would be no reason to add back headcount. It would actually be adverse to the process we have in place, right? There's no driver to add headcount back in many areas of processes within Robinson because we've fundamentally changed those processes through automation, through lean techniques, through efficiency. We think that is of key importance. The other one is our operating model gives us visibility to what we're doing, right? There won't be a surprise that said, "Oops, we added back headcount, we didn't know it." Our operating model doesn't allow that, right? We will see the early indications of that through the operating model process, and we'll certainly receive the results of that through the operating model process. There won't be a situation where we're not on top of headcount versus volume on the NAST perspective. Dave and I are both extremely confident that you will see similar results, if not better. In fact, I would argue you will see better results on the NAST side as we've demonstrated on global forwarding in 2024. Yeah, just one last point on this, Brian, is I always like to say yesterday and today, and it's fair for all of you to do that because we do it to ourselves. Where was the company yesterday? Where is it today? Why is it fundamentally different? If you go back to 2018, 2019, there's a fundamental, as Damon said, structural difference. This is really important that I've been telling to a lot of people as I talk to them. There's a fundamental structural difference of where the company was. We do a, we coined a term called evergreen productivity within Robinson. Evergreen productivity means it's forever. We don't give it back because you structurally change the company. We've achieved this evergreen productivity in global forwarding and NAST, and that's not a clawback. That won't go away. When the market comes back, you've got these things built in. Our digital bookings and our digital transactions within the company, you go back to 2018, 2019, it was less than 5% and pretty clunky, right, on dealing with that. You know, now fast forward to today, you know, we're north of 50-55% in a number of different things. That doesn't go away when the market comes back, and we feel like it's some of the best in the industry. There's just a structural difference, and at our scale, that makes it a game changer, and especially how we're leaning in with large language models, which has really, really changed at our data set. All right, appreciate that. Try to squeeze in two last quick ones here. First one on cargo theft. You know, we hear about it more in the news. We hear about it more from shippers, so it's not just being reported more. They're definitely more concerned about it. It's obviously an industry supply chain challenge, but how does that affect Robinson, and what are sort of the conversations and concerns you hear from your shippers? Yes, good question. I'll start with this. We've been focused on this for almost 18 months. Actually, it was part of the diagnosis in coming in and looking at that. We have a great team, an awesome team that is really on this, and the outputs, this is a key part of the operating model. It was on our enterprise score sheet. We looked at this, we tracked it, and the team just did a wonderful job at producing results here. I mean, take for example, our truckload cargo theft would be really, we have almost zero theft in truckload. We're at 99.99% successful on that. Our customers can feel very confident when they use our service and that we do that. We've also taken a leadership role in this, and we lead up a consortium of some really big names out there and a number of different companies that actually are working with Robinson and seeing some of the things we're doing and actually helping with this consortium. We've also partnered with Highway as well when it comes to this. We put a lot of work and effort into driving this, and I think the benefit has showed up in the numbers, but this is no hubris, and we always knock on wood, and we always have a bit of paranoia around this and always trying to improve when it comes to fraud and theft in cargo. It's a big industry. We're doing pretty good about it. I don't know if you'd add anything on that. No, I would say, look, certainly, as Dave mentioned, our theft-free rate from a load perspective, it rounds to 100%, but we do a lot of loads, as you guys know. There is still opportunity to reduce the dollar impact, and we made significant process improvements in 2024 to yield that benefit. It has been a big focus for us. I'd say in many areas, we're probably, you know, close to leading the industry on some of our practices there. I think the partnerships that we've developed, one with Highway, just continue to safeguard our network as well. It is an area that, you know, the rate can be a little misleading because we do so many loads. It says, "Hey, there's not much of an opportunity," but we would argue from a lean mindset, every bit of leakage is an opportunity, and it's certainly a focus of ours. That's right. Maybe to wrap up with just some thoughts on how to look at normalized earnings power through whatever normal cycle ends up being in the future, but maybe just to use the investor day framework, is that a good way to look at, you know, 2026 forecast or your projection? Is that a good proxy for normalized earnings power when you think about all the changes in the processes and the operating model that you've driven over the last, you know, 18 months or so? Yeah, so what I would reiterate is, so we've committed externally that at mid-cycle, our NAST business will generate 40% operating margins. Our global forwarding business will generate 30% operating margins, and the enterprise will generate, you know, mid-30% operating margins at mid-cycle. That's what we've committed to externally. We reiterated that in investor day. From a specifics perspective, so for a, you know, versus 2023, which was the baseline we used, we're going to generate between $350 million and $450 million of incremental operating income, you know, 2026 versus 2023. One of the assumptions in that construct, of course, is truckload spot rate, which we've assumed will go back to levels of, say, 2019, right? If you look at 2019, we would consider 2019 rates to be slightly above mid-cycle. Using truckload and NAST as kind of a proxy there, you know, we would say we'll be within the range of mid-cycle with what we've communicated for 2026, you know, assuming the market backdrop has the same composition that a normal mid-cycle would have. I'd say we'd be in a pretty tight range to mid-cycle with our 2026 guide. Okay. We're out of time. That's a good place to wrap up anyway. Dave, Damon, thank you very much for joining us today. We appreciate it. Yeah, thanks. Thanks for having us. Appreciate it.