Good morning. Welcome to ChampionX Corporation's third quarter 2023 earnings conference call. Your host for this morning's call is Byron Pope. I will now turn the call over to Mr. Pope. You may begin. Thank you. Good morning, everyone. With me today are Soma Somasundaram, President and CEO of ChampionX, and Ken Fisher, our Executive Vice President and CFO. During today's call, Soma will share some of our company's highlights. Ken will then discuss our third quarter results and fourth quarter outlook before turning the call back to Soma for some summary thoughts. We will then open the call for Q&A. During today's call, we will be referring to the slides posted on our website. Let me remind all participants that some of the statements we will be making today are forward-looking. These matters involve risks and uncertainties that could cause material difference in our results from those projected in these statements. Therefore, I refer you to our latest 10-K filing and our other SEC filings for a discussion of some of the factors that could cause actual results to differ materially. Our comments today may also include non-GAAP financial measures. Additional details on reconciliations to the most directly comparable GAAP financial measures can be found in our third quarter press release, which is available on our website. I will now turn the call over to Soma. Thank you, Byron. Good morning, everyone. I would like to welcome our shareholders, employees, and analysts to our third quarter 2023 earnings call. Thanks for joining us today. We demonstrated the benefits of our geographically diversified portfolio in the third quarter as we delivered adjusted EBITDA growth and margin expansion, despite some near-term crosscurrents in our short-cycle U.S. land businesses. We once again delivered robust free cash flow generation and returned excess capital to our shareholders. I am appreciative of all our employees for their focus and tireless dedication to delivering value to our customers day in and day out. On slide number four, we begin our earnings call with our corporate vision, purpose, and operating philosophy because we wake up every day committed to improving the lives of our customers, our employees, our shareholders, and our communities. On slide number five, we share one example of the many types of ChampionX innovations which emerge from being relentless advocates for our customers and delivering technology with impact. Our SOOFIE continuous emission monitoring system, which was designed from the ground up to be an effective and accessible solution for our continuous monitoring of on-site methane emission detection. This case study illustrates how our SOOFIE system helped one of our customers detect and avoid a catastrophic leak at one of its production facilities in real -time, resulting in environmental and financial savings. Our AURA Optical Gas Imaging, or OGI camera, is a natural complement to our SOOFIE system and is designed to help our customers meet current and future emissions monitoring needs by accurately detecting and documenting even small methane leaks. Now, turning to third quarter performance. Our third quarter revenue increased 1% sequentially, as strong international growth in our Production Chemical Technologies and Production and Automation Technologies businesses were largely offset by lower activity in U.S. land, driven by lower drilling and completions activity. In Q3, U.S. rigs declined almost 10% sequentially, and U.S. completions activity declined over 9% sequentially, impacting revenues in our drilling technologies and PAT segments. Our digital revenues increased 17% year-over-year. We remain highly encouraged by the continued strong adoption of our fit-for-purpose digital solutions, including our emissions management technologies that drive tangible productivity and sustainability benefits for our customers. Our continuous emissions monitoring technology installations continue to grow along with the recurring revenues. Today, more than 60 customers use our SOOFIE continuous emissions monitoring technology. We continue to deliver strong EBITDA performance. During the first nine months of 2023, our adjusted EBITDA grew 28% year-over-year, and our adjusted EBITDA margin expanded 437 basis points compared to the first nine months of 2022. Ken will take you through the details of our third quarter financial results shortly, but let me first touch on three key business highlights, which are shown on slide six. First, EBITDA margin expansion. Despite experiencing $7 million of foreign exchange losses related to Argentina currency devaluation, we delivered an adjusted EBITDA margin of 20.2% in the third quarter, which represents our sixth consecutive quarter of sequential adjusted EBITDA margin improvements. Based on the midpoint of our Q4 guidance for full year 2023, we will deliver an adjusted EBITDA margin expansion of 370 basis points compared to 2022. We remain confident in our ability to further expand our adjusted EBITDA margin as we step through 2024. Second, free cash flow. We delivered another strong free cash flow quarter, having generated free cash flow of $115 million, which represented 60% of adjusted EBITDA. This further demonstrates the best-in-class free cash flow generating capability of our capital-light portfolio of businesses and illustrates our high degree of confidence in converting at least 50% of EBITDA to free cash flow in 2023, and delivering between 50%-60% conversion of EBITDA to free cash flow through the cycle. We expect our free cash flow to continue to grow in the coming years, driven by EBITDA growth and margin expansion. Third, returning capital to shareholders. Our disciplined capital allocation framework is designed to create value for our shareholders, and in the third quarter, we once again delivered on our commitment to return excess cash to our shareholders. In the third quarter, between our regular cash dividend of $17 million and $68 million of share repurchases, we returned 74% of our free cash flow to shareholders. Since we began our capital return program in the second quarter of 2022, we have returned $434 million of capital to shareholders through dividends and stock repurchases. This represents 66% of the free cash flow generated during the same period. We expect our capital returns to grow as we grow our free cash flow in the coming years, and we remain committed to return at least 60% of free cash flow to our shareholders this year and through the cycle. Let me now turn the call over to Ken to discuss our third quarter results and our fourth quarter outlook. Thank you, Soma. Good morning, and thank you for joining us today. I will be commenting on adjusted EBITDA for sequential and year-over-year comparisons. We believe this metric best reflects the business performance of continuing operations. Our third quarter 2023 revenue was $940 million, up 1% versus our second quarter 2023 revenues, while 8% lower than third quarter of 2022. On a geographic basis, sequentially, North America and international revenues were up 1% and 2%, respectively. Drilling down, overall, U.S. revenues were flat quarter-over-quarter, with PCT up 6% and PAT and DT down 3% and 7%, respectively. Meanwhile, the rest of the world revenues were up 3% sequentially, driven by solid growth in PCT and PAT. Year-over-year, North American revenues declined 2%, while international revenues were 17% lower. In the third quarter, our largest business, Production Chemical Technologies, generated solid sequential revenue growth of 5%, with both North America and International contributing positively. With declining U.S. rig count and lower new well completion activities, our shorter cycle U.S. land businesses were impacted in the quarter, with production and automation technology revenues up slightly at 1% and drilling technologies down 4% versus the second quarter of 2023. As previously communicated, sales to Ecolab under the cross-sales agreement ended with the passing of the third anniversary of our merger date. As such, any sales to Ecolab are now reported in the Production Chemical Technologies segment and no longer reported in corporate and other. Third quarter GAAP net income for the company was $78 million, or $0.39 per diluted share, versus $96 million in the second quarter and $23 million in the third quarter of 2022. As seen on slide 10, ChampionX consolidated adjusted EBITDA in the third quarter was $190 million, up 2% versus the previous quarter and a 14% increase year-over-year. Third quarter adjusted EBITDA included the impact of approximately $7 million of foreign exchange loss related to the devaluation of our peso exposure in Argentina during the period. In the third quarter, ChampionX delivered a strong consolidated adjusted EBITDA margin of 20.2%. This was up 7 points sequentially and up 391 basis points over the third quarter of 2022. Our third quarter free cash flow of $115 million reflected strong cash flow from operations and our continued focus on working capital management. The $115 million represented 60% conversion of free cash flow from adjusted EBITDA. Cash from operating activities was $163 million, and capital investment was $48 million, net of proceeds from asset sales. Production Chemical Technologies generated third quarter revenue of $604 million, up 5% from the second quarter and 6% lower year-over-year. Sales were strong in North America and internationally, where respective revenues were up 5% and 6% sequentially. Segment adjusted EBITDA was $125 million, up 7% sequentially and 22% higher than the third quarter of 2022. The third quarter segment adjusted EBITDA was adversely impacted by the aforementioned ARS 7 billion Argentina foreign exchange loss during the period. Sequentially, we saw a positive impact from higher volumes and productivity projects. Volume growth, increased selling price, and productivity projects drove the strong year-over-year improvement. Segment adjusted EBITDA margin was 20.7%, up 37 basis points sequentially, and up 472 basis points from the prior year's period, driven again by the higher volume, selling prices, and the productivity initiatives previously noted. Production and Automation Technologies third quarter segment revenue of $256 million, increased 1% sequentially. Year-over-year, PAT revenue was up 3%. Geographically, international revenue increased 9% sequentially, while North America revenue was down 1%. Digital revenues, which can exhibit some lumpiness quarter to quarter, were down 4% sequentially, while increasing 17% year-over-year. We continue to see increased customer focus on implementing digital and emissions technologies to reduce emissions and drive operational and cost improvements. We remain very excited about expected future revenue growth from digital, including our emissions offering. PAT third quarter segment adjusted EBITDA was $59 million, lower 2% sequentially, while up 14% year-over-year. Segment adjusted EBITDA margin was 23.2%, down 73 basis points versus the second quarter, and up 213 basis points from the prior year due to higher volumes and selling prices. Drilling Technologies segment revenue was $55 million in the third quarter, down 4% sequentially and down 10% year-over-year, with both declines driven by lower U.S. land rig count activity. Drilling Technologies delivered segment adjusted EBITDA of $14 million during the third quarter, flat sequentially and down $3 million compared to the third quarter of 2022. Segment adjusted EBITDA margin was 25.1% in the quarter, flat sequentially. Reservoir Chemical Technologies revenue for the third quarter was $25 million, up 5% sequentially, and a 29% decrease year-over-year. As previously discussed, the year-over-year revenue decline was driven by the exit of certain low-margin RCT product lines last year. This exit resulted in lower revenues, but a significant improvement in the margin profile of this business. The segment posted adjusted EBITDA of $4 million during the third quarter, flat with second quarter, and up $1.5 million versus the corresponding prior year period. Segment adjusted EBITDA margin was 16.6% in the quarter, a 110 basis points sequential decline. Year-over-year, the segment margin increased 914 basis points, driven by the product line exit and related restructuring actions. Moving to our balance sheet, as shown on slide 11, we again ended the third quarter in very strong position, with liquidity of $954 million, including $285 million of cash on hand and our available revolver capacity. At September 30, our net leverage ratio was 0.4x net debt to trailing 12-month adjusted EBITDA. In alignment with our capital allocation framework, we remain committed to the return of surplus capital to our shareholders. During the third quarter, we returned approximately 74% of quarterly free cash flow to shareholders, including $17 million in regular quarterly dividends and $68 million of share repurchases. Year to date, we have returned 76% of free cash flow to shareholders. Moving forward, expect us to continue our disciplined capital allocation process and our focus on delivery of operating and free cash flow, along with continued improvement in working capital management. We will also focus on maintaining our robust liquidity level and a strong financial position, enabled to continue returning at least 60% of free cash flow to shareholders. As we continue to drive disciplined capital allocation and continuous improvement in productivity, as you can see on slide 12, we continue to improve our return on invested capital or ROIC. We are making good progress toward our targeted 20%+ ROIC. Our trailing 12-month ROIC has improved to 17%, up approximately 400 basis points over the 2022 full year actual rate. Now, turning to slide 13 and our forward outlook for fourth quarter, we expect revenue in the range of $930 million-$970 million. The projected fourth quarter revenue sequential change is primarily driven by continued positive momentum in our international businesses, offset by expected seasonal slowdowns in our North American businesses as they move into the year-end holidays. We expect our drilling technology business to experience a sequential revenue decline similar to that of the fourth quarter of 2022, as some of our customers act to manage their working capital and free cash flow into year-end. For adjusted EBITDA, we expect a range of $187 million-$197 million, which at the midpoint represents a 7% increase over the fourth quarter of 2022. At the midpoint, this represents an approximate 200 basis points improvement year-over-year in the company's adjusted EBITDA margin rate. Please note for clarity, this fourth quarter adjusted EBITDA guidance does not anticipate any further significant devaluation in the Argentine peso during the period. Moving forward, we remain confident in our 50%-60% free cash flow to adjusted EBITDA conversion ratio guidance through the cycle, and we expect a free cash flow ratio of at least 50% for fourth quarter and the full year of 2023. Thank you, and now back to Soma. Thank you, Ken. Before we open the call to questions, let me share a few thoughts with you. As a leading global provider of production optimization solutions for the energy industry, we are particularly well -positioned to help our upstream and midstream customers maximize the value of their producing and operating assets in a sustainable and cost-effective way. Despite the short-term softness we are experiencing in our short cycle U.S. land businesses, we expect U.S. activity to start growing in early 2024 as customer budgets reset. We remain confident in the favorable demand tailwinds for our businesses in 2024 and beyond. We are laser focused on delivering solid bottom line growth, adjusted EBITDA margin expansion, and strong cash generation, and we remain fully committed to creating value for our shareholders through our disciplined capital allocation framework with crystal clear priorities for capital deployment, which includes high return investment and returning excess cash to our shareholders. With that, I would like to thank all of our 7,300 ChampionX employees around the world for their tireless and inspiring commitment to our purpose of improving the lives of our customers, our employees, our shareholders, and our communities. I'm honored and humbled to lead such a purpose-driven team. With that, I would like to open the call for questions. Thank you. Ladies and gentlemen, we will now begin the question -and -answer session. Should you have a question, please press star followed by the number one on your touchtone phone. You will hear a three-tone prompt acknowledging your request, and your questions will be polled in the order they are received. Should you wish to decline from the polling process, please press star followed by the number two. If you are using a speakerphone, please lift your handset before pressing any keys. Your first question comes from the line of Stephen Gengaro from Stifel. Please go ahead. Thanks, and good morning, everybody. Can you help us maybe understand your fourth quarter expectations a bit? I'm sort of thinking about what's normally a margin improvement in production chemicals, and I understand the North American softness in some of the other areas. But can you kinda help us understand a little bit, maybe on a segment basis, the margin progression you're looking at? Yeah. Good morning, Stephen. So, you know, when you look at the Q3 to Q4 margin progression, we expect, you know, PCT, given the resilience of PCT and the seasonal improvement in the international business in PCT, we expect PCT margins to perform well in Q4, you know, compared to Q3. You know, you should - you should see, it had a strong performance in Q3. You should see similar performance or even slightly better in Q4. And, and I think, Stephen, this will be an important time, as you know, also to talk about this Argentina devaluation. And, so I'll, you know, as I finish my comment, I'll ask Ken to talk about that. Because that impacted the Q3 margin for us. That, when it comes to PAT and drilling technologies, when you look at PAT, we do expect sequentially the business to be softer in U.S. land. And we saw as we exited September. So when we entered Q3 and how we exited September, we could see in September the weakness getting more pronounced in the U.S. land activity in September. And so we do expect that as we go into the Q4, the normal seasonal slowdown will be fully present. You know, we saw some signs of that already starting to happen in September. It is also the mix in PAT, as you know, you know, the completion side is primarily, you know, ESP is driven more by the completion side, so tends to be a higher margin, in the PAT side. So that along with, some slowdown in the hardware digital purchases in Q4, I think, you know, so that mix will impact PAT. So which means we will see Q3 to Q4, PAT margin to be somewhat down. And then when you look at the DT, DT is where we are going to see bigger impact, and, this is going to be very similar, to, because the conversations with customers are very similar to, the type of conversation that happened last year. So it's very clear that, particularly our Drilling Technologies customers are starting to get very focused on Q4 working capital management. We have already received calls to push out deliveries, and those type of conversations are already happening. So that's why we expect our Drilling Technologies business to be impacted. You know, if it is similar to last year, you can imagine it could be sequentially down as much as 11%-12%. So as you know, that business decrements higher, so you should expect the Drilling Technologies business to be down. Now, having said all this, Stephen, I would say, you know, we see lot of this type of seasonal slowdown and customers managing working capital towards Q4 to be very temporary issues. You know, if you look at the quality of the businesses are still very strong, we have still delivered, you know, year-over-year strong exit margin improvement, and you will still see strong cash generation, you'll still see strong capital returns. So these, we see these as temporary U.S. land weaknesses, which we are experiencing, which started towards the end of the third quarter, and then now we see it playing out in the fourth quarter. So we expect 2024, you know, as we enter into early 2024, we expect the budgets to reset, and we are, you know, we are confident it'll be another year of positive growth in U.S. land, as well as globally. So with that, I do want Ken to talk about Argentina devaluation just to because since it impacted our Q3 margin. So Ken? Yeah. Hi, Stephen. The PCT business historically has done business in Argentina profitably. We have roughly about $100 million of annual sales there. We had some questions around the devaluation impacts, so I wanted to be clear about that. It's not really a revenue issue in that we're U.S. dollar functional accounting there, and many contracts are essentially indexed to the dollar, so that when we invoice, we invoice at the current rate then. But the issue was that historically, we've been, as primarily a product supplier, we've been able to repatriate monies to the U.S. out of Argentina regularly. And so, it had never been an issue before, but late last year, and then through this year, we've seen the government make a series of changes to both regulation and practice that's delayed repayments to us and delayed our ability to repatriate. And so we had built up a balance with the peso exposure in the country that then right after the election, they changed the exchange rate, and we were hit with the loss that we noted. So in the meantime, we've been working to mitigate that through, you know, trying to minimize that balance as much as possible. We have curtailed a little business, and then we're negotiating, and in fact, have some customers agree to start to pay us outside of the country, in U.S. dollars. So, we'll continue to work that exposure down here over the next couple of quarters. As of this week, it's about a $15 million exposure. So should there be another significant devaluation, you know, we would have an issue, but we're working hard to minimize it. I think, Stephen, you, you as you know, some of the companies have approached this to do a Blue Chip Swap, which results in a, you know, major write down. Yeah, maybe, that's a good point. A lot of the peers in the group are primarily providing services, so historically, they were less able to repatriate, and so they built even bigger balances, and they accessed a parallel market called the Blue Chip Swap and took big losses. They excluded those losses from their EBITDA. We treat FX today as part of normal adjusted EBITDA, so you get some small gains and losses each period, but we don't exclude it. But you know, some of the peers took some pretty substantial write-downs on the Blue Chip Swaps at late last year and early this year because they'd built up even more significant balances. So because we're a product provider, we are able to repatriate normally. The government actions recently have been, you know, adverse and, you know, not very appreciated, I guess I'd say, so. Hopefully that helps give some color. Yeah, that does. Thank you. And just one quick follow-up for me, and that is, when I think about the sequential PCT margin performance in 4Q, is that after taking into account the $7 million, so i.e., a cleaner number being flat to maybe slightly up in the fourth quarter? Yeah. So I think, you know, the PCT margin in Q4, it does not, you know, contemplate another devaluation, and under that scenario, it should be closer to the 21%. Gotcha. Great, thank you for the details. Thanks, Stephen. Your next question comes from the line of Marc Bianchi from TD Cowen. Please go ahead. Hi, thanks. I wanted to ask another one on this Argentina situation, because it seems like if you're gonna have 21% margins here in PCT in fourth quarter, there really isn't any operating leverage in the business, 'cause you're just sort of recapturing the absence of the $7 million hit in the third quarter. Are there some other crosscurrents that are worth pointing out? Or maybe I'm not reading that right. No, I don't think that anything significant of... You know, I mean, there's always some mixed issues that happens within the businesses. So, outside of that, I would say, Marc, there's nothing of other than the normal variations due to mix. There is no major any other issues. Okay. And then, Soma, you had mentioned an expectation for growth in entering 2024, but I know typically there's some seasonality that occurs in the first quarter with PCT falling off. Can you just sort of walk us through the typical progression and if you have any particular insight about early 2024? Yeah, Marc, you know, great observation, because we always see this Q4 to Q1 seasonality. And, in the past, we have provided some color around, you know, historically, how that has worked in our, PCT, business. So on a -- if you look at over the last seven or eight years, you know, the PCT business, and, you know, on an average or at a, at a mean, Q4 to Q1, revenues have declined about 5%, you know, that is a pure seasonality. And some quarters it's much worse, some quarters it's, better, depending on how Q4 is. So there will be a Q4 to Q1 decline in our PCT revenue, which is seasonally driven. And, historically, like I said, it could be, you know, 5%. But when you look at the DT, Drilling Technologies, we do expect the Drilling Technologies business to rebound in Q1. And again, we have shown historically, when Q4s tend to be the type of Q4 we are expecting, Q1 will rebound. You know, and typically in some years it's a sharper rebound, but we do expect, you know, Q1 to be a good rebound in our Drilling Technologies business. We expect PAT business, Q4 to Q1, to be sequentially better as well, because, you know, the budgets typically reset in the early part of Q1. So normally what we'll see in the PAT business is it will start a little slow in January, but as the budget starts getting into place in February, we will exit the Q1 quarter with a much stronger run rate than when we entered Q1. So in summary, we'll expect PCT to be seasonally down Q4 to Q1. We expect PAT to be Q4 to Q1 up. We expect DT to be up Q4 to Q1. And then, as we look in the rest of the year in 2024, Q1 tends to be the lower quarter, and Q2, Q3 tend to sequentially improve from there. Q4, as you know, Marc, that you know, like we are seeing this year, sometimes we run into these type of issues, but that's too early to predict what Q4 of 2024 may look like. We are confident Q4 to Q1, there will be growth, and we'll see growth Q1 to Q2 and Q2 to Q3. Great. That's a very helpful summary. Thank you. Thanks, Marc. Your next question comes from the line of David Anderson from Barclays. Please go ahead. Hey, good morning, Soma. I have a few questions around the North America side of PCT. So the U.S. rig count contracted 20% this year, but if I look on the EIA numbers, onshore production appears to actually increased, at least through July. Now, you said lower PCT revenue was through the rig count falling, but I thought there was a little bit of a longer term, longer cycle relationship there. Is impression really the driver here? Am I missing something in terms of that side? I'm surprised it was that much of a relationship. Yeah, Dave, I think, let me make sure that we clarify. I think in the, you know, we, in the slide deck, we had a slide which showed the sequential by segment U.S. versus non- U.S. So if you look at that, the PCT business actually grew sequentially 6%. Where we had the real issues were in PAT and DT in the U.S land. So this goes to show the long-term relationship and the resilience of our PCT business. So PCT U.S. business grew 6%, Q2 to Q3. Okay, so that held up there, or that better. Okay, so it's the PAT side and the relationship there is the completions with the ESPs. Okay, that makes sense. So if we think about kind of longer term drivers in NAM for PCT, so U.S. onshore is sort of in manufacturing mode. We're not gonna see a whole lot of production growth over the next several years. So how should we think about the drivers in NAM for PCT from here? Is there an underlying kind of increasing chemicals intensity story here? How should we think about kind of growth in this business relative to production over time? Yeah, Dave, I think that's exactly right. And even if you look at, you know, our continued growth in the U.S. business in PCT, it's a combination of two things. One is definitely the growth in the intensity, and then the second aspect is, you know, Gulf of Mexico continues to grow as well. If you look at our offshore growth, Q2 to Q3, we grew 12% sequentially in the offshore markets globally, and Gulf of Mexico was an important part of that as well. So as we go into 2024, we continue to expect, you know, the intensity improvements as well as, you know, the offshore - the Gulf of Mexico growth as well. But so even in a flat, let's just say hypothetically, U.S. onshore production is flat. Should PCT still continue to grow with higher, basically, chemicals to production over time? That's right. Is that a trend you're expecting to see? Okay. That's right. And then secondly, and then sticking on U.S. onshore, E&P consolidation is obviously a big theme with Exxon and Chevron. Can you talk about what that means to your business? And I guess I'm curious just how fragmented we know the offshore business is sort of very moaty around that, but how about U.S. onshore? Is that more fragmented, and does this potentially create more market share opportunity for you onshore? Yeah, you know, I think, you know, when you look at this consolidation, so the positive aspect for us is, you know, we have stronger relationships, as you know, with the IOCs, and, you know, you saw with Exxon, you know, we have, we won the Supplier of the Year award. So as the- Mm-hmm ...consolidation is driven by the IOCs, you know, our presence, and our long-term relationship with our IOCs should help us continue to maintain and gain positions in this consolidation. Mm. Now, the thing we have to really be watching for is to make sure, obviously, you know, as they consolidate, if the E&Ps will also look for, you know, efficiencies and- Right ... and savings along the way. Mm-hmm. So, but we do feel, given our long-term relationship and given the global way we support our customers in these areas, I think, you know, we will see, it'll be a net positive for us. Okay. So aside from any U.S. onshore production growth, the two main drivers in NAM here are gonna be increasing revenue, sorry, increasing chemical intensity and market share on top of kind of any other inherent growth. So, okay, that makes a lot of sense. All right. Thank you very much, Soma. Thanks, Dave. Your next question comes from the line of Scott Gruber from Citigroup. Please go ahead. Yes, good morning. Good morning, Scott. So Soma, you know, it does look like your EBITDA margin is gonna stagnate here in 4Q, given this North American weakness. But if I heard you correctly, I think you mentioned margin expansion in 2024. Can you walk through, you know, some of the major drivers, you know, for continued margin expansion? And do you think, you know, getting back to that 21% level later next year is a realistic goal, or do you think you'd do better? Yeah. You know, Scott, if you, if you look at, for the last two to three years, we have consistently expanded margins every year. And clearly, there is a bit of a calendarization in how our margin performance is quarter to quarter. In a given, Q1 tends to be a softer quarter, you know, it tends to Q4 to Q1, you typically will see a bit of a margin drop, and then we'll pick up our expansion efforts from there. So when we look at 2023, you know, so, or when you look at 2022 and versus 2023, at the midpoint of our guidance, you know, we will expand margins, you know, close to three, a little over three in that basis points, right? So you will see, as you know, as we go into 2023, continued expansion of that. That will be driven by, you know, a couple of things. Number one, we do expect a positive growth for full year in 2024. So that incremental will help. The second is our continued productivity efforts and continued growth in higher margin businesses, i.e., our digital business and, you know, our emissions business. So we do think that, you know, the mix of our businesses in the growth will also help. So to answer your question, we do expect continued margin expansion in 2024. Got it. In looking specifically at drilling, you know, that business used to, you know, post margins, you know, closer to 30%. It was closer to 25%, and I realize, you know, it's gonna take a hit here in 4Q. But just thinking about the medium term, you know, is 25% the new normal, or should we be expecting, you know, something better than that, high 20s, 30%? Where can that business get back to? Yeah, Scott, you know, it's a great question. I think, you know, there is a structural element around, you know, the continued drilling efficiencies that are driving the volume growth challenges in that business over a period of time. So, you know, it, the business is definitely a 25% business, that, there's no question in our mind. Can it get to a closer to 30% margin business? Is going to very much depend on volume. But what I would say is it's definitely a 25% margin business at this state. Gotcha. Appreciate it- It will take a hit in Q4, as I mentioned. Right. You know? Yeah. Got it. Thank you so much. Thanks, Scott. Your next question comes from the line of Saurabh Pant from Bank of America. Please go ahead. His line has just got disconnected. Moving over to the next question from Ati Modak from Goldman Sachs. Please go ahead. Hi, good morning, team. Can you mention that the Argentina revenue exposure doesn't really exist, it's more in the margins? It sounds like there were activity expectations that drove the delta versus expectations for 3Q around guidance, especially some... I'm wondering if there were any other things, maybe destocking and drilling technologies, any other factors you can provide any color on, and how do you see those going forward? Yeah, you know, if you look at our shortfall to, first of all, we are disappointed with it, right? You know, so our shortfall to our own guide, midpoint guidance is about $35 million in top line, right? And I would say, Ati, half of that is related to the U.S. land, and particularly in PAT. You know, again, this is with respect to our expectation and PAT and Drilling Technologies. So roughly $16 million-$17 million of that $35 million is shortfall in U.S. land, in PAT, as well as in Drilling Technologies. The remaining $16 million -$17 million is a combination of two things. One is, you know, a shortfall in Argentina, and that is primarily driven by a delay in import certifications. And that, you know, I'll ask Ken to comment on that. It again, this is all related to this devaluation issue. And then the remaining, another country, where we had a shortfall, compared to expectation, is in Mexico. So Argentina and Mexico together, you know, contributed another about $15 million-$16 million to the shortfall. So there are three primary areas where we had shortfall to our expectation: U.S. land, Argentina and Mexico. Yeah. And Argentina was about $5 million of that revenue, and that—what drove that was we saw the government slow down or stop giving import certificates during the course of the quarter. And we weren't the only ones that experienced that. We actually engaged with the U.S. Commerce Department and heard that a lot of imports were being similarly treated across a lot of sectors. And then the commerce guys have actually been helpful in trying to get us those certificates, and they've started to flow a little bit better recently. Got it. Thank you. Just as a follow-up, is there a way for us to gauge what the segment exposure is in Argentina? Is it evenly spread out? Is there a higher exposure than any- It's essentially all PCT. Largely PCT? Yeah. It's, there's not a lot of PAT exposure there. Got it. And, the other question I had is, you mentioned free cash flow growth over time, a lot of that from EBITDA growth and some margin expansion. I'm just wondering if there is any kind of color you can provide. You have a bunch of productivity projects ongoing. Is that the main driver, or are there other operating leverage drivers here into as you think about hitting that 21% target and beyond? Yeah, I think the 21% target for us is, as I mentioned, you know, is a combination of productivity and incremental revenue growth. That's what I would say. And I think the free cash flow conversion of that 50%-60% for us is very much intact. And, you know, I think you will see our business continues to be a capital light business, and we'll continue, you know, to generate that 50%-60% free cash flow conversion. Great. Thank you. I turn it over. Thanks, Ati. ... Your next question comes from the line of Saurabh Pant from Bank of America. Please go ahead. Hi. Good morning, Soma, Ken. I'm sorry, the line got disconnected for some reason, right when you called my name. Sorry about that, but, thanks for getting me back on. Good morning, Saurabh. Go ahead. Yeah. Soma, I think basically, I'm thinking of how should we think about the level setting expectation for revenue growth from a 2024 perspective? Because North America has, like you said, some cross currents. Activity would be improving on a leading edge basis, but on a full year basis, maybe you can expand on that. How do you see North America behaving in 2024? And then international and offshore should be doing well, right? So how should we think about top line as a whole for 2024 versus 2023? Yeah, you know, Saurabh, if -- let me start by saying, you know, we do expect positive growth both in North America as well as internationally in 2024. Now, given what we have seen in terms of the Q3 slowdown and now the Q4 slowdown, a seasonal slowdown, I think the base in Q3, particularly for U.S. land, that's kind of, you know, lowered a bit, right, from- Mm-hmm. What we had assumed. So as we go into Q4, like I said, you know, I think we will see in as we go into next year, you will see in North America, the Q1 revenue to be sequentially better, Q4 to Q1, and then it will progressively get better into Q2 and Q3. So from for me, it's a you know, again, Q4 of next year is too early to predict right now, but but I do expect a positive growth in North America. So what we are seeing right now is a you know, is a temporary situation in that respect. Nothing in our customer conversations is telling us that 2024 is not going to be a growth year in North America. Okay, perfect. Now, Soma, that's helpful. And then just one quick follow-up on the PAT side of things, because there's obviously a seasonal element year-end slowdown, budget issues, all of that stuff. But I'm just thinking, is there also an element, and how important is it, if you are thinking about the lag effect of lower D&C activity, right? Lower completion activity on production, there's obviously a little bit of a lag, especially on the ESP side of things. How should we think about just that lag effect versus seasonality? Because that would tell us how quickly things recover in 2024. That's the reason I'm asking. Yeah. Saurabh, you know, I think, you know, intellectually and logically, you know, we definitely, we see there should be a lag effect, right? Mm-hmm. But we have tried correlating this multiple times, you know, whether it is a three-month lag, six-month lag, nine-month lag, and we have tried doing that. And it's, it's a little harder to pin down, you know, how much is the lag effect because of a couple of things. Number one is, as you know, the ESP, which is the primary business that tends to get impacted by completion slowdown. Customers, it tends to run ESPs 2x and 3x into the same well nowadays. So sometimes it's very hard to kind of, you know, it's not one to one, so it's always been a bit harder to really quantify exactly how the lag effect works. But I do agree with you that there is a lag effect, and but it's just hard to quantify and predict. And we saw that in, because as we got into September, you know, we clearly could see our ESP installed rate starting where, how we entered the quarter in Q3, and how we exited the quarter in Q3 was lower. Mm-hmm. Mm-hmm. Okay, okay, okay. Now, Soma, I know you've talked about the secondary, tertiary installations in the past, so that, that obviously offsets it, to some extent. But no, that's helpful. Okay, Soma, thank you. I'll turn it back. Sure, Saurabh. Thank you. Your next question comes from the line of Doug Becker from Capital One. Please go ahead. Thank you. Soma, continuing with PAT, you know, the company received top marks in the Kimberlite Artificial Lift survey, but the growth in PAT has been a little bit slower than I would have thought, even factoring in the, you know, U.S. activity dip, given that some others have talked and pointed to Artificial Lift as an area of strength. So really just wanted to get your thoughts on the competitive landscape within Artificial Lift, and if there's any market share shifts taking place there. Yeah. So I think, Doug, from a competitive landscape standpoint, I think if you look at the market kind of differentiated in—if you look at the two major forms of lift in Artificial Lift, which is the ESP and the Rod Lift. So when you look at the ESP market landscape, I think our competitive position remains strong there, and we feel the activity is the major driver behind any type of slowdown we see, yeah. Now, when it comes to Rod Lift, you know, there's a lot of players in Rod Lift, you know, especially when you go to the lower end of it, particularly in components and repair shops and so on and so forth. So sometimes in rod lift, you will see, you know, some pricing pressures and issues in the fringes, you will see. But the way we focus on rod lift is in terms of the type of value we provide. So when I look at our own data, you know, I don't see a lot of market share loss per se. You know, there are some in the fringes, but I wouldn't call that as the biggest driver for any type of slowdown in growth. It's largely an activity driven, and we have, you know, today in the U.S., as you know, Doug, we have a pretty good market share position in all forms of lift. In some of the lift categories, we are the leading share position. But if you look at across all lift positions, we have, you know, really good market share positions. So I think I would say that, you know, the growth issue, which we are experiencing it, you know, in the second half year, is largely an activity issue. Well, that's helpful context. One last one. Just curious if there's been any nuance in or change to the revenue CAGR you talked about, you know, from 21 to 25 at the Analyst Day, high single digits. Still plenty of time, but wondering if this year is maybe shaded or maybe at the high end, less likely. Yeah. So, Doug, you know, if you look at 2023, you know, if you normalize for the various elements such as Russia exit, the cross-sales exit, you know, terminating, as well as the some of the product line exit we did as part of our PCT restructuring. If we normalize for all of that, and at the midpoint of our guidance, it's somewhere in the 4%, you know, in 2023, you know, 4% or slightly better. So when you look at that, obviously, you know, when we gave our high single-digit CAGR, you know, we weren't expecting the second half this level of activity weakness than what we expected, right? So it makes it harder, right, you know, though, because if we are starting with a lower year than we anticipated, so it makes it harder. But, you know, we are not giving up on that. But, but I will acknowledge that it makes it harder, given that we started fourth, you know, with a 4% as the first year. Yep, makes sense. Thank you so much. Thanks, Doug. There are no further questions at this time. I'd now like to turn the call back over to Mr. Somasundaram for any closing remarks. Well, thanks, everyone, for joining, today's call, and we look forward to talking to you in our next quarter's earnings call. Thank you and have a great day. Thank you, sir. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Have a lovely day.