Good day, ladies and gentlemen, and welcome to the Cengage Group 2023 second quarter ended September 30th, 2022 investor call. At this time, all participants have been placed on listen- only mode. The floor will be open for questions and comments following the presentation. If you wish to enter the Q&A queue to ask a question, please press star one on your phone at any time. It is now my pleasure to turn the floor over to your host, Richard Veith, Treasurer at Cengage Group. Sir, the floor is yours. Good morning and welcome to Cengage Group's fiscal 2023 second quarter investor update. Joining me on the call are Michael Hansen, Chief Executive Officer, and Bob Munro, Chief Financial Officer. A copy of the slide presentation for today's call has been posted to the company's website at cengagegroup.com/investors. The following discussion contains forward-looking statements within the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking statements can be identified by words such as believe, expect, may, will, estimate, likely, and similar words, and are neither historical facts nor assurances of future performance and relate to future results and events, and they are based on Cengage Group's current expectations and assumptions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict and many of which are outside of our control. Many factors could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statement. You should consider such factors, many of which are subject to the risks and uncertainties discussed in the slide presentation which accompanies this call, and in the Risk Factors section of our fiscal 2022 annual report for the year ended March 31st, 2022, as may be updated by our quarterly reports for fiscal year 2023. Any forward-looking statement made in this presentation is based on currently available information. The company disclaims any obligation to publicly update or revise any forward-looking statements except as required by law. On today's call and in our slide presentation, we will refer to certain non-GAAP financial measures. Definitions and the rationale for using these measures and reconciliations of each to its most directly comparable GAAP financial measure are provided in the appendix to the slide presentation. I'll now turn the call over to Michael for an update on the business, followed by Bob, who will take you through the second quarter details before we open the call for questions. Michael? Thank you, Richard. Hello, everyone, and thank you for joining us today. We are pleased to provide a business update for the first half of our fiscal year 2023. Despite the phasing impacts of the back-to-school period in the Northern Hemisphere, the strong performance of our well-rounded portfolio puts us firmly on track to deliver mid-single-digit revenue and ELPP growth this fiscal year. The recent realignment of our corporate structure into three business units, Cengage Academic, Cengage Work, and Cengage Select, has allowed us to execute growth-focused strategies in attractive education markets. We remain confident in our ability to deliver sustainable growth as we continue to scale our digital products and services, which currently exceed 70% of net sales. Throughout the first half, we have effectively addressed the macroeconomic headwinds of inflation, supply chain disruptions, and stagnant enrollment in the U.S. higher education market. The strength of our well-rounded portfolio positions Cengage Group to meet our short-term financial outlook and longer-term objectives. Adjusted cash revenue increased 3% in the first half of the fiscal year, fueled by 77% growth in Cengage Work and 29% growth in English language teaching, part of Cengage Select. We anticipate that these business units will become a more meaningful part of Cengage Group over the longer term as they continue to grow and strengthen their position in their respective markets. The 4% decline in Cengage Academic was largely driven by timing of when we report and when the higher ed back to school period in the Northern Hemisphere occurs. While we are already seeing these effects reverse, Bob will explain the phasing in more detail during his financial update. In addition, supply chain challenges with paper and print shortages are starting to reverse in the third quarter. Through strict cost management, continued evolution of our operating model and pricing strategies, we expect to expand our total margin this year and expect to increase margins going forward. This all will drive ELPP growth faster than revenue. Our confidence in our near-term and long-term outlook is underpinned by three simple facts. First, we have leading competitive positions in highly attractive markets. Second, we have significant growth opportunities in the parts of our portfolio where education delivers a more direct path to employment. Third, we are scaling our digital products and services across our global portfolio, resulting in improved unit economics. Cengage Work, comprised of our workforce skills business, continues to gain share of this $13 billion total addressable market through effective customer acquisition at lower costs and proven ability to create, deliver, distribute, and scale quality content. In the eight months since acquiring Infosec, a leading cybersecurity training and education provider, we have moved quickly to integrate product lines and expand into new channels, evidenced by the more than 100 ed2go partners that now offer Infosec courses to their customer communities. Cengage Select, which is comprised of businesses serving specific attractive education markets, like English language teaching and research, has delivered strong revenue growth in the first half of the fiscal year. Our ELT business is growing at a rate of 29% year to date, driven by the continued rebound of demand in Latin America, particularly in K-12, along with higher sales in the U.S. K-12 market. Our research business has achieved steady top-line growth due to consistent demand for high-quality digital content. As school districts grapple with learning deficits compounding by the multi-year COVID pandemic, our research business enhanced its suite of K-12 products to better align to curriculum and digital learning environments. An expanded partnership between our research business and Texas schools and libraries is positioned to mitigate learning loss by providing millions of Texans with equitable access to reliable content regardless of their location, age, education, or financial status. Strong growth in our secondary and international higher ed business partially offset the decline in our U.S. higher ed business as this market continues to face headwinds. As enrollment declines in U.S. higher ed, more digital and institutional offerings, such as Cengage Unlimited and Inclusive Access, become the majority of U.S. higher ed revenue, the Cengage Academic business unit is on a solid path to return to growth. We continue to leverage significant growth opportunities where education delivers a more direct path to employment. Within Cengage Work, we see growing demand by learners who seek alternative paths to improving their skills and employers who are facing severe talent shortages. We have made great progress in expanding our sales capabilities to global markets while improving our lead generation and conversion rates. We are also building a new employer offering called Ready to Hire to bridge learners from certification to employment. In growing job areas such as allied health and cybersecurity, this is particularly important. Within our Select business unit, research with a strong foothold in 99% of the top public libraries has forged partnerships supporting millions of adult learners who seek to earn an accredited high school diploma, upskill, or start a small business by accessing Gale services free of charge from their local library. As we continue to focus on delivering choice for students, we are exploring cross-selling opportunities between businesses. For example, cybersecurity education and English language teaching products to U.S. K-12 schools. Growth in Cengage Group is also driven by continued digital migration with attractive economics. The shift to digital, along with our ability to scale and successfully manage costs, has allowed Cengage's ELPP margin to expand by over 400 basis points since 2019, and we believe there are further opportunities. In fact, in the first half of fiscal 2023, ELT has seen a 44% increase in digital sales, and we are well-positioned to capture further growth. Additionally, synergies in Cengage Academic showcase additional prospects for digital expansion in international higher ed and secondary markets. In closing, we strongly believe we will continue to meet our financial objectives to deliver sustained mid-single digit top and bottom line growth driven by a well-rounded portfolio of leading businesses in attractive markets. We sincerely appreciate the support of all of our stakeholders and look forward to providing quarterly updates as the fiscal year progresses. I will now turn the call over to Bob to walk us through our results in more detail. Bob? Good morning, and thank you, Michael. Starting with the Cengage Group financial highlights. With October now behind us and the fall season largely complete, we are on track to deliver on our fiscal 2023 guidance. I'll provide more details on our full year expectations as I take you through the first half. While we are pleased with the momentum we see across the business, our second quarter and first half are not indicative of our full year performance, being held back by significant temporary sales timing effects which I will come on to. Adjusted cash revenues for the first half was $775 million, up 3% in total and flat on a pro forma basis. Adjusted cash ELPP for the first half was $232 million, down 7% on a pro forma basis, being impacted by both sales timing and cost phasing. Looking across a full academic year to remove sales timing effects, on a trailing 12-month basis, our adjusted cash revenues are 5% ahead on a pro forma basis, with digital net sales up 3% and now representing 73% of total net sales over the last 12 months. Trailing 12 months adjusted cash ELPP is $311 million, up 2% on a pro forma basis. ELPP is on a similar trajectory to the prior year, where growth progressively accelerated through the second half. In fiscal 2023, this is underpinned by expected moderation of cost growth in the second half, as substantial incremental savings from executed first half initiatives flow through, and COVID normalization costs are increasingly in the prior year base. Consistent with trends in prior years, interim results are significantly impacted by the inherent seasonality of our business and the shifting channel and demand dynamics within sales seasons driven by our digital strategy. This continues to shift revenues from Q2 to Q3 over the fall season, most notably in U.S. higher education within the Cengage Academic segment. In addition to this recurring pattern, as highlighted in our Q1 update, first half revenues are temporarily held back by much higher print back orders, with the impact most pronounced in Academic. We are tightly managing our supply chain to meet customer demand and expect to largely clear back orders over the third quarter without impact on the full year. These revenue timing effects are expected to reverse over the second half. We have continued to make good progress in addressing back orders since the end of Q2, in line with customer expectations, and other timing effects are reversing as expected. This comes through in revenues for the month of October, where Cengage Group revenues were up over 15%, with Cengage Academic up over 25% versus the prior period. As a result, Cengage Group pro forma adjusted cash revenue growth accelerated to 2% year to date to October. Turning to financial results across our three core business units, Cengage Academic, Cengage Work, and Cengage Select. Cengage Group's first half revenue performance reflects continued strong growth in Cengage Work, which is up 10% on a pro forma basis, and accelerating momentum in Cengage Select, which grew 7%. Together, these businesses balance the 4% decline in Cengage Academic. On a trailing 12-month basis, looking across the academic year, the revenue growth trends across our core business units are broadly consistent with our expectations for the full year. Clicking down into our business unit performance in more detail. Cengage Academic's first half revenue and ELPP is significantly impacted by the temporary revenue timing effects. With these expected to reverse over the balance of the year, academic revenues are expected to be broadly flat for fiscal 2023. Over the second quarter and through October, we have further progressed the integration of the U.S. and international higher ed and secondary businesses into a new operating model to accelerate digital growth and optimize synergies. Our digital initiatives are gaining good traction across international and secondary. With the reorganization of sales and marketing teams completed in recent months, on top of the earlier integration of content, product, and digital delivery teams, we have now realized over $20 million of structural operating cost savings in Academic on an annualized basis, which will have significant incremental impact on the second half of fiscal 2023. Against the broadly flat revenue outlook for Academic this year, these savings, alongside ongoing efficiency programs, are expected to deliver solid profit growth and ELPP margin expansion in fiscal 2023. Looking at the industry sectors served by Cengage Academic. To reiterate, the first half performance of U.S. higher education is significantly impacted by phasing. This year, higher back orders of print and bundled products are adding to the established timing shifts from digital channel and demand trends, which together are moving revenues from Q2 into early Q3. The impact of these phasing effects is evident in October sales performance, where we saw over 20% growth in the month against a high comparative as these effects partly unwound. With October coming through as expected and the fall season substantially complete. We now expect fiscal 2023 adjusted cash revenues and net sales to be down mid-single digit, including a drag of 1% from lower licensing sales this year. This is in line to marginally better than the underlying performance last year, and we believe overall industry trends. With National Student Clearinghouse data indicating full enrollment declines moderating to between 1% and 2%, performance is otherwise driven by unit volume declines, which we have seen through the fall and we expect to carry to the full year. We believe these unit volume declines reflect lower sell-through across courseware and print, driven principally by lower faculty requirement and increased pressure from the aftermarket, respectively. Our average unit prices in aggregate across digital and print are marginally ahead through the fall season, with higher average print unit prices offsetting modest mix-driven compression across digital formats. On digital, executed pricing strategies largely mitigated the drag of mix effects from continued strong growth in institutional business and students continuing to migrate to more affordable products such as e-books. In response to the trends through the fall season, we are progressing go-to-market and digital product initiatives, leveraging our differentiated product offerings, Cengage Unlimited and Cengage Infuse, to drive share gains and progressively improve sales performance over time. In international higher ed, first half adjusted cash revenues were up 2% to $64 million. Strong growth into Europe, Middle East and Africa, and Asian regions was moderated by the temporary effects of higher backorders and digital shifts in Canada and shortfalls in Australia, where international enrollments have been slower to recover from COVID. As the temporary effects reverse and Australia stabilizes, international growth is expected to accelerate in the second half, resulting in mid-single-digit revenue growth for the full year. This expectation is underpinned by a strong sales pipeline and good underlying momentum in digital as we continue to successfully leverage products and capabilities developed in U.S. higher ed across our international markets. Our secondary business is performing strongly and on track for an excellent year. First-half underlying sales are up 10% compared to the prior period. Normalizing for the temporary adverse effects of high backorders, which we expect will largely reverse in Q3, first half sales are over 15% ahead. This reflects a high capture rate in the Florida math adoption, strong performance in open territories, and growing momentum in advanced placement and career and technical education sales. The sales season is now substantially complete. At the end of October, we have over 80% of our expected full-year sales supported by confirmed orders and a robust sales pipeline. We expect full-year adjusted cash revenues and net sales to accelerate in the second half, resulting in full-year growth of over 15%. We're also encouraged by continued strong progression in digital, with sales up almost 20% in the first half. Turning to Cengage Work. First half adjusted cash revenues were $51 million, up 10% on a pro forma basis, including Infosec, and on track to meaningfully exceed revenues of $100 million for the full year. Current demand across our core healthcare and cybersecurity sectors remains strong and we believe will be resilient to broader macroeconomic pressures. As Michael addressed, we see significant growth opportunity in the large and growing skills market and are investing to scale the business, broaden distribution, and develop the employer channel, while also leveraging an expanding number of revenue synergy opportunities across our business. The investments we have made to date in expanding go-to-market capabilities and optimizing lead generation and conversion in both ed2go and Infosec are expected to drive accelerated growth in the second half and propel Cengage Work to full-year revenue growth of 15%-20% on a pro forma basis. In Infosec, which is currently performing in line with our acquisition expectations, these investments include significant expansion of the boot camp sales team and adding channel and international sales teams for our software products. For boot camps, which represent around 55% of Infosec revenues and have shorter sales cycles, growth accelerated through the second quarter to 12% for the first half. For the highly scalable software business, we have experienced teams now in place and expect new business to accelerate as the year progresses, building on the solid year-to-date growth in recurring revenues from our installed base. In ed2go, we have now integrated Infosec product offerings into over 100 academic partner catalogs and are seeing the results of our go-to-market optimization programs come through in meaningfully improved lead generation and conversion metrics, which underpin the accelerating growth performance through Q2. The ongoing investments in Cengage Work, which moderate its ELPP contribution in the near term, are targeted to drive durable double-digit revenue growth. As the business scales, we expect margins to progressively improve towards the overall Cengage Group margin over the medium term, underpinned by the attractive unit economics of our business. Turning to Cengage Select, which had strong growth of 7% in the first half of the fiscal year. English language teaching has shown continued strength, with growth accelerating sharply through the second quarter. First half adjusted cash revenues were up 29% to $58 million. The business is firing on all cylinders, with every region delivering double-digit growth through the first half. Notably, this includes Asia, where we are seeing stabilization of the market in China and robust growth in other Asian markets. We continue to build digital momentum with digital net sales up over 40% in the first half and strong double-digit growth in digital usage as we continue to invest in our digital strategy to support the increasing adoption of hybrid learning. ELT has sustainable momentum, and we expect revenue growth in the second half and for the full year to match or better the first half performance. This reflects the clear digital momentum, strength of our pipeline, and growth in our business to government channel, which is both from the ongoing implementation of multi-year Ministry of Education contracts from fiscal 2022 and new business wins this year. We're also encouraged by the opportunities these deepening relationships are presenting for cross-selling other products and services, notably Workforce Skills, where there are clear needs across international markets we serve. Research also continues to build momentum as the year progresses. First half adjusted cash revenues reached $118 million, up 3% on the back of a solid second quarter. Performance is underpinned by high database renewal rates of over 95%. From this durable recurring revenue base, growth is being driven by strong demand for archives from higher education institutions, underpinned by new commercial models launched last year, new database sales in the U.S. K-12 academic library sector, where the business has a leading position, and a recovery in demand for large print where we have a strong publishing program. The first half revenue growth trends are expected to be broadly sustained in the balance of the year, with expectations for the second half underpinned by strong sales pipelines and a buoyant funding environment, with the ESSER program extending over multiple years. In the other segment, comprising the ELT and Australian K-12 businesses, first half revenues are marginally behind the prior period, with accelerating growth in the ELT being outweighed by market-driven weakness in the Australian business. For the full year, we expect these effects to reverse, with strong digitally driven growth in the ELT offsetting the softness in Australia to result in a broadly flat revenue outlook for the full year. First half unlevered free cash flow was $54 million, with cash performance progressively improving as the academic year progresses. The first half cash flow performance is principally driven by the normal annual cash cycle. Compared to the prior period, cash flow reflects profit performance and temporary working capital phasing, notably the relative timing of royalty payments, and in Q2, higher accounts receivable balances. The increase in accounts receivable reflects our success in the Florida State math adoption in secondary, in respect to which collection periods are typically extended, and also some impact of back orders. These temporary impacts account for most of the year-over-year variance, and we expect will reverse in the second half and not impact full year cash performance. As a key enabler to our strategy, we are making good progress on the multi-year build-out of new SaaS-based global business systems, that is CRM, ERP, and e-commerce, with new e-commerce systems now live in multiple territories. The balance sheet investment in these initiatives, which shows up in working capital, is expected to be around $25 million in fiscal 2023. Looking to the full year, our business is highly cash generative, with operating cash conversion consistently in the range 80%-90% over the past three years, a track record we expect to sustain this year and going forward. A couple of other points before we leave cash flow. Our tax payments are expected to remain modest for the foreseeable future, being driven by international operations. In the U.S., we have around $1 billion of NOLs available to shelter future U.S. taxable profits. Our cash interest costs this year are expected to be around $170 million. Moving to our capital structure. The balance sheet remains strong. Our total cash balance at the end of September was $244 million, with total liquidity standing at $417 million. Through the second half, our cash and liquidity is expected to continue to progressively build, consistent with trends in the previous years and driven by the strong inherent cash generation dynamics of the business. Net leverage temporarily increased to 6.3x at the end of September, with the normal seasonality of the business. Trailing 12 months ELPP is ahead 3%, and the combination of expected acceleration in the LPP growth in the balance of the year and cash generation underpins our expectation of finishing the year having reduced net leverage to around 5.3x. This is consistent with our targets to reduce our gross and net leverage progressively over the medium term, to which we remain committed. On the back of the strength of our balance sheet and in the context of our continuing assessment of our capital structure, we have continued to deploy excess cash to pay down debt, with total debt reduced by $43 million in the first half. We are also in the process of executing an amend and extend of our ABL facility with the support of our banking partners. We expect to complete this shortly, extending maturity out to 2027, a five-year term. With a solid first half and strong revenue performance in October to largely close out the fall season, we are firmly on track to meet our full year guidance, which is summarized on the last slide. The underlying momentum in the business and high visibility into strong sales pipelines underpins our expectations for the balance of the year and our confidence in further refining our full year guidance. From pro forma revenues of $1.398 billion, we expect Cengage Group fiscal 2023 adjusted cash revenues to grow by mid-single digits. This translates to revenues in the range of $1.455-$1.47 billion for the year and sustains the growth trajectory of fiscal 2022. To briefly recap expectations across the business units. We expect Cengage Academic revenues to be broadly flat, with strong double-digit growth in secondary and solid growth in international, offsetting a mid-single digit decline in U.S. higher education. At Cengage Work, we expect pro forma full-year revenues to be ahead in the 15%-20% range, with our initiatives and investments continuing to accelerate both ed2go and Infosec as the year progresses. In Cengage Select, we expect revenues to be around 10% ahead for the year, driven by the very high growth in ELT and solid momentum in research. Against this revenue range, we expect to deliver ELPP in the range $345 million-$350 million. This will represent another year of solid margin expansion in a period in which we will have made significant incremental investments in Cengage Work, funded through productivity improvements and the ongoing simplification of our operating model, most notably evident in the over $20 million of annualized savings we have fully executed in Cengage Academic this year. To close, through the combined strength of our portfolio, we believe we are on track to deliver another year of solid top and bottom line growth while investing against significant opportunities across our markets with the aim of sustaining this trajectory over the medium term. Looking beyond fiscal 2023, we are closely monitoring macroeconomic trends and the ongoing recessionary and inflationary risks. While recognizing that aspects of the current economic situation and outlook are unique, we are also charting our course, taking account of the resilience our business has demonstrated through past recessions and the countercyclical opportunities a downturn may present. Thank you. I will now hand over to the operator for questions. Thank you. Ladies and gentlemen, the floor is now open for questions. If you have any questions or comments, please press star one on your phone at this time. We ask that while posing your question, you please pick up your handset if listening on speakerphone to provide optimum sound quality. Please hold while we poll for questions. The first question is coming from Matt Swope from Baird. Matt, your line is live. Good morning, guys. Good morning, Matt. Michael, if I could just ask on U.S. higher ed, you guys are guiding to a mid-single digit decline for the full year there compared to enrollment down between 1% and 2%. How should we think about this business going forward? How is revenue there gonna track enrollment over the next few years as we think about it? Yeah, Matt, I think it's a great question. I think so first of all, we are assuming until we have any further hard evidence that the enrollment drag is gonna continue in the 1%-2% range, roughly for the foreseeable future, until we really see a significant shift in the labor market, which might provide an uplift. That's kind of our working assumption. Then I think what we are seeing is a bit of a normalization back to what the pre-COVID situation was. What that means is that we're seeing a continued growth of digital, but you know, at a not a high rate of growth of digital, and that is offset by print decline, of which we are seeing every year. That is also offset by, you know, some price compression because the mix changes. In other words, to put it simply, the student is gonna opt for whatever the cheapest version of the content is that they can buy. That in some cases is, you know, Cengage Unlimited because they have more than one course with Cengage, or it might be, you know, the standalone, or it might be, you know, a product that is just an e-textbook. In that respect, I think we are gonna see price compression, but driven by mix, not by the absolute price decline. I think that's gonna be the case in this market for the foreseeable future. At some point, but I don't think it's gonna happen over the next, you know, one ot two years, we're gonna see a leveling out of this market, and then I think we're gonna start seeing some growth coming back into that market. But that is the assumption that we're making and that underpins our projections for the next few years. I guess maybe I didn't have quite the right understanding. It feels like the mix has shifted fairly dramatically already over the past few years, driven by you guys. Why is that shift still having such an impact? Why do we have these big timing effects even though you're already so heavily digital? It just feels like we're already there on the digital front, but listening to you, it sounds like we have a long way to go. I think we have a long way to go. If you look at it and we're working on this, Matt. If you look at it on a per seat basis, right? Let's do some rough math. There are about 60 million students in the United States in higher- ed. You know, they take roughly four to five courses per year. So you look at 90 million seats. If you look at that and you say, which of these seats are truly digital? It's you know, 50%. So there is still a fair ways to go in terms of seats. Now, in terms of our revenue, we are more digital because we are one of the players that can actually provide a digital you know, digital platform that is working, and we have attractive offers. In terms of the total market, there is still ways to go. I see. That is helpful. Maybe related. Cengage Unlimited has seen very significant declines. Is that due to some philosophical change? Are you guys pushing Cengage Unlimited less hard than you were before? No, it's not. It's absolutely not. We've continued to push Cengage Unlimited. Matt, what is actually happening is that during the course of the pandemic, Cengage Unlimited is a very powerful weapon to take share from competing publishing companies, right? We take share from our competitors. During the course of the pandemic, and even until now, in many respects, faculty was concerned about other things than switching the providers of their courseware. They were focused on, can I teach digitally? What do I need? What do I need to keep the students, et cetera. Now we are seeing that actually faculty is coming back to campus. Faculty is opening up the question again more and saying, like, you know, maybe I want to switch. The committees are forming, et cetera. What we're seeing is the pipeline for potential switches to Cengage Unlimited and to Cengage from others is really building very strongly. It was more that for a period, pandemic-driven, for a period of time, those decisions were not being made, and therefore the weapon was kind of a little bit blunt, to put it bluntly, no pun intended. The pipeline is building very robustly and we continue to push it. The second point I would make is we have been pushing Cengage Unlimited Institutional very hard with the institution because the institutions, those discussions have been going on, and Cengage Unlimited Institutional is growing very nicely, in fact, growing faster than Inclusive Access for us. In that respect, you know, that we kept the pedal to the metal for that particular variant, and that has shown success. Thank you. The next question is coming from Sami Kassab, from BNP. Sami, your line is live. Thank you very much, and good morning, Michael. Good morning, Bob. I have a few questions. Good morning, Sami. As well. Thank you, gentlemen. First is on inflation. As inflation accelerates around the world can you elaborate on your ability to increase your own prices at a faster pace than before? Perhaps elaborate across different divisions and perhaps have a few examples. The next question is also on inflation, but it's more on your cost base, and in particular on unit wage inflation. What would you guide us to expect for the coming 12 months? Do we think that wage inflation will be more in the 3%, or 5%, or 7% range? Lastly, I think in your prepared remark, Bob, you mentioned that part of the reason why courseware were declining in terms of volumes had to do with faculty adoption. I didn't fully understand that. Do you mean that faculty are moving more towards the zero textbook cost courses or does that reflect movement in adoption shares or is it just the answer that you made to the previous question that I perhaps overheard? Thank you for discussing that. Yeah. Thanks, Sami, for your questions. Let me suggest the following. Let me hit the third question first, and then I'll go to the first and then the inflation question on pricing, and then Bob is gonna handle the cost inflation question that you asked. On courseware, I think what you heard was the slide. This is not exactly correct in the sense that what we are saying is what we are seeing, and that I think a lot of other companies are seeing the same thing, is that faculty has been less inclined to require courseware that the student buys the courseware. They offer it, they adopt our product, but then they're putting less the requirement that you actually have to buy it, and you have to use it. That requirement is a very strong driver for the student to actually buy it. It's more about the requirement to buy it that has changed. Based on our research, that's changed because faculty, again, this is pandemic and post-pandemic kind of behavior, they were much more concerned about giving the students, you know, the cheapest way to get the course materials. They're still teaching with our course materials, but they didn't wanna put an additional pressure on them to buy something else. They said, like, "Well, maybe we can manage, you know, through the period okay." We don't think that's gonna be a permanent thing, and we're seeing, you know, courseware activations actually picking up, which is a good positive sign. That's the clarification on the last point. On the first point in terms of our pricing ability, I think your question rightly points out that I believe everybody in this world today and in every geography sees the inflationary pressures. Therefore, despite the fact that we continue to be very focused on affordability and that we've been leading the drive towards affordability in this market, our ability to pass on some of the inflationary pressures to customers has clearly become much more acceptable in the market. That's true really for all of the segments that we're operating in. As you know, there are, in most segments, we are still operating with a very fragmented customer base, so we don't have big institutional accounts. In that respect, I think our ability to pass these prices on is, you know, it's fairly instantaneous. We're very conscious not to overdo it. I mean, we don't want to sort of go back to the bad old days, so to speak, where prices were raised, you know, like every six months. Our ability to pass it on is clearly there, and we're using it with good measure. Bob, do you wanna take the cost inflation question from Sami? Sure. Hi, Sami. Just to add to Michael's point, the other lever, which gives us confidence in the ability to maintain margins with a very responsible and thoughtful approach to pricing is, of course, our ability to work with partners and suppliers to manage our input costs. We do that through, you know, all sorts of levers, including, you know, long-term supply contracts, but also working together to drive operational improvements and bring input costs down. And that's, you know, proving effective, and I'm confident, you know, we can continue to expand margins as we go forward. On the question of labor costs, particularly Sami, I think like everybody, we've we're seeing labor cost inflation. This year, our labor costs sort of went up sort of 3.5%-4%, very much in line with what we're seeing across the market. We've been able to handle staff sort of turnover very well, which I think is both a reflection of our pay policies, but also a reflection of the very strong sort of culture we have within Cengage. I think going forward, I would expect labor inflation to run at the same sort of rate that we've seen this year. I'm encouraged by the most recent U.S. inflation statistics, which show a bit of bending of the curve, which came out this morning. You know, hopefully that will continue, you know, easing some of that sort of market pressure. That's perfect. Thank you very much, gentlemen. Thank you. Thank you, Sami. Thank you. The next question is coming from Nick Dempsey from Barclays. Nick, your line is live. Yeah, good morning, guys. I've got two questions. Just, first one, a follow-up to Sami's question about faculty and their being inclined to require courseware for students. Now, if faculty are concerned about forcing students into the expense of buying textbooks post-pandemic, it's not really clear to me why that will get better. Because as I understand it, there hasn't been too much inflation in tuition fees so far, but presumably that will come as faculty are demanding their own wage increases, et cetera. The general environment is not great for the consumer. Why will faculty's p ropensity to force students into buying textbooks get better over the next one to two years than it is now. The second question, I noticed in the slide that it says you lost share on an MPI basis of 42 basis points compared to on a trailing twelve months view that was, compared to zero at the first quarter stage. Are some of the timing effects that you're pointing to driving that share loss, or do you think truly like for like through the fall 2022 season you have lost share? Yeah. Nick, let me, this is Michael. Let me handle those questions, and I'll ask Bob to chime in if he has an additional perspective on this. In terms of the faculty price sensitivity. Fundamentally, we've always assumed and will continue to assume that faculty is concerned about the price that students have to bear for their education in general and for their course materials as well. That's why we pushed very hard affordable solutions, b ut I wanna be very clear, faculty is requiring, by and large, students still to buy the quote-unquote, "textbook". They are just giving them more choices in which format they're gonna buy it. You know, particularly if they have, you know, two courses with Cengage, then it's obvious they're gonna say go for a Cengage Unlimited because it has both the e-textbook as well as the courseware built into the price. That is by far the most compelling option. If there are other options available, like for instance, just buy an e-textbook, then they will leave it open. The moment they put a requirement for courseware in, that forces the student to a higher price point. The reason that we believe that this courseware requirement will go back to its track that it was prior to the pandemic is that I think we're still seeing a bit of the aftermath of the pandemic, but the courseware offers some very compelling features for faculty, right? They can set up the course very easily. They can develop homework. They can grade homework. They can do assessment questions. All of stuff they can't do in an e-textbook or in a print book for that matter. I think for our view of that is that we will go back to where the trend was prior to the market, that in certain disciplines that is going to be a requirement and faculty will ask that. In others where there is less homework and less need for those features and functionality, there will be less of those requirements. That's really what drives our underlying assumptions. Last second question around the MPI data. As you know, and as we have shared this, since the introduction of Cengage Unlimited, we have gained market share on the MPI, and you know MPI is the six largest publishers in the market, so it's not the full market, but it's about 80% of the market. We have consistently gained share since the introduction of Cengage Unlimited. What I said earlier in response to Matt's question, what we've really seen during the pandemic is because of the absence of faculty on the campus, there was less of our ability to, so to speak, make our case for the switch. That is now changing, and as I said, the pipeline is building again with Cengage Unlimited. In terms of the specific number that you quoted, that was, in our judgment, largely influenced by timing, and we will see the fresh MPI data coming out, very shortly. We believe that that will put us, you know, again, in a flat or slightly gaining position with regard to the MPI data because of the timing effect. Perfect. Thank you. You know, as Bob said, we already know our October results, obviously. That gives me personally a great deal of confidence to say that slight difference between us and our competitors will reverse. Right. Thank you. The final question is coming from Allan Kang from Vector Capital. Allan, your line is live. Hi, guys. Thanks for taking the time and taking my question. I just wanna understand the timing of the back orders a little bit more. Could you give us an idea or range even, in dollar terms of cash revenue through October, for the Group and for Academic? And in a similar vein, I think you had mentioned that October was a high comp from last year. How disproportional was October in Q3 last year? Was it half of the quarter, a third of the quarter? You know, how should we think about that? Just wanna understand the timing issue more. Thank you. Sure. Hey, Allan. To give a sense of sort of back orders, I think at the end of September, they were approaching $20 million. Those are unwinding basically over the course of the next three months, so October, November, December, very much to an agreed schedule with the customer. We're delivering metronomically against that, which is why very high confidence that there's no impact on the full year. A large part of those back orders sits within academic, both sort of secondary and U.S. higher education. The reason that we have a high comp every year is, you know, there was a level of back orders last year. It was less than $10 million in total. As we see this year, we see continued shift as a result of institutional billing growth from September into October. You know, that's sort of a significant driver of the over 20% sort of growth that we saw in Cengage Academic in October of this year. October is a pretty significant month in the final quarter. The final quarter of the calendar year is relatively low. It's October that drives sort of the growth in this current quarter. Got it. Thank you. Thank you. That concludes today's Q&A. I would now like to hand the call back to Michael Hansen for some closing comments. Thank you. Thank you, Paul, and thanks everybody for joining us on the call. I hope you got from our results as well as our comments that we feel despite turbulent times in the world and turbulent times certainly in the education industry as well, that we feel extremely confident, not only in our this year results, but in the trajectory and the path for growth that we have set for the business. We appreciate your continued interest and support, and we're looking forward to updating you next quarter. Have a great day. Thank you, ladies and gentlemen. This does conclude today's conference. You may disconnect your lines at this time, and have a wonderful day. Thank you for your participation.