Hello, my name is Kevin, and I'll be your conference facilitator this afternoon. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there'll be a question and answer session. If you'd like to ask a question during this time, please simply press star and the number one on your telephone keypad. If you'd like to withdraw your question, please press star two. I'd now like to turn the conference over to Ms. Elena Rosman, Vice President of Investor Relations. Please go ahead, Elena. Thank you, Kevin, and thank you for joining us on today's call. With us today are Jim Lico, our President and Chief Executive Officer, and Chuck McLaughlin, our Senior Vice President and Chief Financial Officer. We'll spend about fifteen minutes discussing details of yesterday's announcements, which are posted to our website. We'll then conduct a question and answer session. We have prepared slides to supplement our remarks, which are posted on Fortive's Investor Relations website. Our presentation contains certain non-GAAP financial measures. Information required by Regulation G is available on the investor section of the website at fortive.com. During the call, we will make forward-looking statements, including statements regarding events or developments that we expect or anticipate will or may occur in the future. These forward-looking statements are subject to a number of risks, and actual results may differ materially from any forward-looking statements that we make today. Information regarding these risk factors is available on the forward-looking statements page of the presentation, as well as in our SEC filings, including our Annual Report on Form 10-K for the year ended December 31st, 2023. These forward-looking statements speak only as of the date that they are made, and we do not assume any obligation to update any forward-looking statements. With that, I'd like to turn the call over to Jim Lico. Thank you, Elena. Good morning, everyone. I'll start on slide three of our presentation. As you know, yesterday afternoon, we announced a number of deliberate steps to further accelerate our strategy and ensure consistent value creation. First, we announced our intention to separate our Precision Technologies business into a standalone, publicly traded company through a planned tax-free spinoff. The spinoff would position Fortive and the new PT company as two separate scaled companies, each with a focused business model and its own clear growth and capital allocation priorities, offering distinct and compelling investment profiles. Second, in connection with the spinoff, we also announced exciting leadership changes aligned with our internal talent development and succession plans. And third, in line with our commitment to driving consistent value creation, we announced that Fortive is prioritizing return of capital during the transition period before the spinoff, and intends to deploy the majority of our free cash flow during that period to share buybacks. We have strong underlying financial performance in our businesses, and we're confident in our outlook for the remainder of the year and most recent guidance. We have deep conviction that the separation into two independent, publicly traded companies is the right next step in Fortive's evolution. I'd like to spend our time this morning providing additional context on each of these announcements, and then we'll open the call up for your questions. Turning to slide four. Over the last eight years, we've invested in our key growth platforms to create a more durable, higher growth company with an intense commitment to innovation, delivering continuous value for our customers and sustainable growth across Fortive. Our consistent execution has resulted in strong double-digit adjusted earnings and free cash flow compounding, demonstrating our ability to profitably evolve our portfolio of businesses. However, the value inherent in Fortive has not been reflected in our share price. Further, we also recognize reducing complexity of our portfolio allows for focused execution and clarity of strategy. Following the spinoff, Fortive, now with 50% recurring revenue and 25% software business, is even better positioned to accelerate growth and consistently grow earnings and free cash flow. The spinoff of PT will allow the new company to focus on key secular trends, including power and electrification and aerospace and defense, driving strong through-cycle growth. Each company will thrive, focused on its strengths with robust financial profiles and strong investment-grade balance sheets, allowing for differentiated investment opportunities and tailored capital allocation strategies that are based on the objectives and business needs of each individual company. We are confident that this plan will position each company for the future and to deliver enhanced value for all of our stakeholders. Turning to slide five. We also announced planned leadership changes aligned to this transition, advancing two strong, internally developed executives to lead the new companies. The board and I have always had a strong focus on developing the next generation of leaders at Fortive. Our long-standing succession process ensures a relentless dedication and commitment to continuous improvement, which is inherent in our strong culture and proven business system. This is a terrific moment in time to share that succession process. Included in our announcements is my planned retirement upon the completion of the spin. At that time, Olumide Soroye, currently President and CEO of our IOS segment, will take over as Fortive's next president and CEO. Olumide brings more than thirty years of experience and expertise in the development of market-leading software and workflow solutions across multiple industries and has driven impressive results at IOS, enhancing the financial profile of the segment. Tammy Newcomb, President and CEO of our PT and AHS segments, will assume the role of President and CEO of NewCo in connection with the separation. With over thirty years of experience, Tammy has demonstrated a bold vision and rigorous customer-centric approach, contributing to extraordinary results at Precision Technologies, and more recently, in Advanced Healthcare Solutions. Given their expertise, strategic and operational achievements, and passion for FBS, the board and I have the utmost confidence that Olumide and Tammy's continued leadership at each company will result in significant and consistent value creation for the years to come. Additionally, Chuck McLaughlin announced that he will retire as Chief Financial Officer by the end of the first quarter of 2025, after a successful nine years at the company. As we transition to new leadership and the separation, we will continue to operate as one Fortive, with our strong values and inclusive culture. Between now and the spin, Chuck and I will be dedicated to ensuring a smooth transition to new leadership. Let's now take a few minutes to focus on key investment and financial highlights for each company following the expected separation, starting with Fortive on slide six. Fortive will consist of the portfolio brands currently operating under Fortive's Intelligent Operating Solutions and Advanced Healthcare Solutions business segments. Its market-leading portfolio, which includes strong software content and capabilities, delivers productivity, safety, and reliability value for customers across industrial and healthcare operating environments. After the separation, Fortive is expected to be a consistent mid-single-digit grower, with more resiliency and less complexity, and a balanced capital allocation approach, using both organic and inorganic investments to leverage its domain expertise to accelerate its growth and enhance its already attractive base of 50% recurring revenues. Given the demonstrated resilience of both IOS and AHS portfolios and proven ability of FBS to drive innovation, Fortive will be well positioned to shift its focus from accelerating through cycle growth to driving consistent total growth, all while consistently growing earnings and free cash flow. Importantly, Fortive's scale and strong free cash flow-generating profile allow for a disciplined and balanced approach to capital allocation between M&A and return-enhancing share repurchases, which I'll cover in more detail shortly. Turning to slide seven. PT NewCo will comprise the same leading brands that currently operate under the Precision Technologies segment and will continue to benefit from FBS's ability to drive growth, innovation, and value. As a standalone company, it will be poised to capitalize on powerful secular trends across key end markets by leveraging its mission-critical technologies in test and measurement, specialty sensors, and aerospace and defense subsystems. With a focus on key growth areas, including electrification, AI and data centers, and aerospace and defense spending, PT will be positioned to deliver mid-single-digit through cycle growth. NewCo will benefit from seasoned FBS leadership and innovation that will power its earnings flywheel. While capital allocation policies will be approved by the NewCo board, the business will be able to leverage its industry-leading free cash flow generation to focus on returning cash to shareholders while pursuing selective M&A opportunities aligned to its core expertise and secular growth drivers. Turning to slide eight. As I mentioned earlier, between now and the completion of the tax-free spin-off, Fortive expects to utilize approximately 75% of our available free cash flow to fund additional share repurchases. We believe proactively repurchasing shares is the most disciplined and highest value-enhancing deployment of capital we can do as we work to execute the spin. Going forward, following the spin, Fortive will take a balanced approach. Its prioritizing M&A strategy will leverage Fortive's existing domain expertise across leading growth platforms to accelerate strategy and deliver superior returns. The focus will be on enhancing recurring revenue growth and free cash flow, leveraging FBS to drive accretive cash returns. Share repurchases will also be consistently utilized to help drive returns, with a particular preference for action when there is dislocation in our valuation. Finally, it's expected that Fortive will continue to pay a modest dividend that grows in line with earnings and free cash flow over time. Regarding the transaction overview on slide nine, I'll highlight that our intent is for the separation to be effected through a pro rata distribution of the shares of a newly formed entity holding the company's existing PT businesses to Fortive shareholders. The transaction is intended to qualify as a tax-free spin-off for U.S. federal income tax purposes. We expect to complete the spin-off in the fourth quarter of 2025, subject to the satisfaction of certain conditions, as outlined in the presentation and our press release. Over the coming months, we'll be providing additional financial and transaction details. In addition, we are planning to present the strategic and financial outlooks for both companies at investor conferences next year. Before we open the line for questions, I'll summarize the information on slide 10. Our outlook for the third quarter and full year 2024 remains unchanged from what we communicated in our second quarter earnings call. I couldn't be prouder of what our team has accomplished since Fortive's launch in 2016. We are delivering differentiated multiyear financial results, as you see reflected in our track record for the last five years. At the same time, we believe the opportunity to create two separate public companies with distinct, focused business models provides the strategic clarity necessary to unlock the long-term value for our stakeholders, and the time to do that is now. And finally, the impactful contributions of Olumide and Tammy have set both companies on a path to success, which gives me great confidence in the future. With that, we will go to questions. Thank you, Kevin. We will now open the line for questions. Certainly. We'll now be conducting a question-and-answer session. If you'd like to be placed in the question queue, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. We ask you please ask one question, one follow-up, then return to the queue. Once again, that's star one to be placed into queue, and if you'd like to remove yourself from the queue, please press star two. And as a reminder, please ask one question, one follow-up, then return to the queue. Our first question today is coming from Julian Mitchell from Barclays. Your line is now live. Thanks very much. Morning, Jim, and congrats on getting all this news out there yesterday. Maybe just the first question would be around you know, when we're thinking about the spin out of the NewCo, I suppose, to what degree should we use the Vontier spin as a kind of template or placeholder in terms of elements like the scale of stranded and stand-up costs and also the leverage profile of Vontier at the time of its spin? Hey, Julian, this is Chuck. And Vontier is probably not a bad starting point for, you know, the scale, like the stranded cost. Although, we'll work hard to minimize those even more than we did in Vontier. From the leverage point of view, not the same. Vontier came out more leveraged. We expect to set both of these companies up with roughly the same leverage profile, somewhere around 1.4-1.7 times net leverage coming out, so they both have investment grade coming out. So that's a little bit different in that regard. Julian, I would. The only add I would have is maybe more, if you think about Vontier, great business, great. A lot of similarities in terms of great brands and such great capability. But they did have the EMV headwind that they had to sort of address within the business at that time. I think the opposite here with PT. We've got real strength in electrification. We've got real strength on, from an end of the investments that are being made to modernize in the defense industry. Those are real tailwinds, and we should expect that much of the technology markets that have been a little slower here at Tek and within sensing should start to, you know, I think every indication is they're gonna improve by the tail end, second half of 2025. So I also think, just as Chuck said, relative to the cost, but also the business should be seeing some tailwinds as well as they spin out into their public life. That's helpful. Thank you. And then, just my follow-up would be, Jim, you talked at the beginning around the, one of the, the big rationales for this move being, increased, simplicity and, and reduced complexity at, at Fortive. But I suppose, you know, investors often would say, looking at the RemainCo, you know, IOS, AHS and, and then the, the Fluke and associated brands, you know, that still looks sort of relatively, I suppose, complex from the outside, without obvious overlaps, perhaps between those three. Just wondered sort of how we think about the scope for, you know, that portfolio evolution at, at the RemainCo and, and why you would characterize that RemainCo business mix as kind of, non-complex? Yeah. Well, I would say it starts with strategic clarity around capital allocation. Obviously, we've said in the public remarks, we would certainly have a more balanced approach on the M&A front, very focused on recurring revenue. So I think from a strategic clarity perspective, their ability to sort of articulate exactly how they're gonna build the company going forward is really around the business model and the business model around recurring revenue. So I think that's number one. I think number two is where they play. If you think about... I mean, sometimes I think when people think of Fortive, they wanna take all the operating businesses. But if you just step back and say: What is what is Fortive going to do when we spin out? It's you know, the logic there is really, their growth strategy is around durable streams of revenue, software, consumables, subscription services. The recurring revenue and the capability to build recurring revenue businesses is a common capability. And then more broadly, where they play, you know, they really deliver productivity, safety, and reliability solutions to you know, to industrial and healthcare companies in interesting operating environments. So you know, whether it's, no matter where it's at, you're really talking about. I've always said our healthcare business is more industrial healthcare. We're helping the hospital deliver greater value through safety and productivity and reliability. That's no different than what we're doing in the other pieces of the business as well. I think the strategic clarity, the simplicity of the business and the business structure is really, as well as just the common set of solutions that go after customers, all of those lead to that commonality around, I think, simplicity, Julian. We feel I know Olumide and the team are really excited about, you know, the ability to do that in a more common way. I think that really gives them the strategic clarity that I think is gonna be really exciting for investors. When you start with the financial profile of the business, with 50% recurring revenue, the gross margins, you know, over 65%, and the earnings capability of the business, I think you get even more excited about what that business can do. Great. Thank you. Thank you. Thank you. Next question is coming from Andy Kaplowitz, from Citigroup. Your line is now live. Good morning, everyone. Jim and Chuck, congrats on your eventual retirement. Thanks, Andy. Thanks, Andy. Can you give us a little more color on how you might deploy capital before this spin out? Is there a thought process to accelerate the timing of repurchases? Do you have any plans to maybe front load? And then any further commentary regarding the potential for that $450 in 2025? The street's obviously lower, but is that kind of number still on the table if you accelerate your purchases, with the obvious understanding that by the end of 2025, the company in its current form wouldn't exist? ... Andy, you know, we've talked about or signaling 75% of our free cash flow is gonna go towards share repurchase. I think the front loading of that would, you know, if we see some dislocation, you know, that's something we might consider, and look at. So we'll look at all those options. But we've given you a lot to think about, you know, today, and so, but let us just get through this, and we'll move forward. But, you know, when you look out over the next year, we're committed to 75% of the cash flows going to repurchases. Andy, I would just say on relative to, you know, we'll provide an update as we get closer to the start of 2025 on what the guide might look like from an EPS perspective. But what we can say, I know for sure, is that we'll grow adjusted earnings on a double-digit basis, and the share repurchases will certainly help that as well. Tough. And then, Jim, the pause on M&A until the transaction timing late next year, and your commentary in the release regarding balanced capital deployment, you know, between M&A and repurchases, it seems like a relatively significant change in deployment strategy. Is that really the intent, even after, you know, this transaction, to be relatively more balanced between M&A and repurchases? I certainly think between now and spin, I think what we wanna really do, Andy, is to make sure that we give investors certainty as to what Fortive is, how we're gonna allocate capital between now and the spin. As Chuck said before, we believe that both businesses, we believe deeply both businesses should have investment-grade balance sheets going forward. We really wanna provide that certainty as to how we're gonna deploy cash between now and the spin. I think that's number one, and certainly a primary use of free cash flow, really, the use of free cash flow beyond the dividend and maybe some debt repayment. That's number one. Relative to how we think about Fortive going forward, it is more balanced. I think when you think about compounding, our ability now with the growth rate that we'll have, the organic and total growth rate, our ability to compound off that with the high gross margins and high EBITDA margins, plus some M&A, plus share repurchases, really is a more balanced, and we believe, more effective way to deploy capital going forward. So, we will see a change from what you've seen, although I would say over the last couple of years, while we've been opportunistic, we have bought back a decent amount of shares. We've done a fair amount of share repurchases. But we definitely think a balance here is something that's really important. you know, and I think we definitely are excited about the fact that, you know, we think this strategy unlocks the value that we believe we've built inherently in Fortive, and we think that can be reflected in the share price with a more balanced approach to M&A here at Fortive. Or excuse me, a more balanced approach to capital allocation. Appreciate all the color. Thanks, Andy. Thank you. Next question is coming from Steve Tusa from JP Morgan. Your line is now live. Hey, good morning. Morning. Good morning. Congrats on a lot of heavy lifting in the last, you know, eight years or so. It's been the portfolio is definitely in better shape than it was back then. So, congrats on that run for sure. The technicalities around the SpinCo, does the structure preclude you from, you know, from doing anything strategic with that business or that business doing anything strategic for itself, whether it's a merger or asset sales or things like that, from a tax-free perspective? Well, I think, first of all, if you're... If the question is more deeper, if you know, we certainly would, we are very intentional about the spin with NewCo, for sure. We deeply believe in the strategy, and we can talk more about that, Steve. But I think at the end of the day, we believe deeply in the spin. We would expect some people to sort of wanna discuss other options there. You know, we're always about getting, you know, really optimizing shareholder value here, so we'll certainly listen to those things, but there's lots of impediments to that, for sure. We certainly, as you can imagine, in a decision like we took and announced yesterday, in a variety of ways, there's been a lot of thought and process gone into that, a lot of it, you know, our advisors as well. We feel very good about the strategy we outlined yesterday in our press release and certainly with you all today. We feel very good about the direction, and we're gonna run really fast and really hard down that direction. But I wouldn't be surprised if somebody did come in and say some, you know, offer some things, and we'll listen to it. But, you know, at the end of the day, we won't be distracted by what we believe is the best course of action. And, you know, let's see where that goes. What are the impediments that you're talking about? Well, I think sometimes you think about, you know, just as an example, we've got a really low tax basis in some of our businesses, and so, you know, we would need to get paid for that. So, you know, and so this tax-free spin is a really good way to unlock value, and we feel really good about where that business can trade at. And so there's a tremendous amount of value to be unlocked at PT, and we would expect that anyone who wanted to come in and do something differently would have to pay well beyond that unlocked value, and we'll see if anyone does that. Is the tax rate for PT consistent with current Fortive's current tax rate, and is that transferable to any, you know, buyer, if they want to merge or anything like that? Steve, I think the from a tax planning standpoint, there's a lot of complexity to that. There's no change to 2025. And I think when I—we've—so it's early, and so exactly, do they end up exactly the same? Unlikely, but I think the sum of the parts ... I would expect the same tax liability. Is it transferable? You know, every entity does tax planning differently, and that would depend. But I think that speaks to the impediments that Jim's talking about, really just the tax leakage is to be pretty big on some of these businesses. Okay, one final one. Most importantly, where's Elena going? To which business? The organizations going forward have not necessarily been determined, but I would suspect, you know, Elena will be afforded, so. Okay, great. Thanks. Thanks, congrats. Thank you. Next question is coming from Nigel Coe from Wolfe Research. Your line is now live. Thanks. Good morning. I'm really glad we cleaned up Elena's future direction. So, yeah, congrats on all the moves here. So look, Jim, I just wanted to kind of. You addressed this, you know, with Julian to some degree, but, you know, there are some out there that are kind of puzzled why, you know, Fluke and Tek don't belong together as more sort of an industrial cluster. And it sounds like it's more a case of recurring revenue software makes sense to be together, Tek's a bit more difficult, different profile. Just make sure. I just wanna make sure that's the answer. And then just to kind of put a finer point on the spinoff, you know, is this a clean spin of PT as it is today? Could there be some assets transferred from IOS and maybe AHS, you know, into or out of that vehicle? Just curious if it's a straight PT spin. And have you considered alternatives? I mean, you seem to have shut down RMT, but you know, so a split versus a spin, was that also in consideration as well? Yeah, a lot to unpack there. Let me take them in both. Number one, I think from how we spent a considerable amount of time over the last several months evaluating opportunities and options for what we do. And I think at one point, we had ten different scenarios that we worked through. So these situations always have that. When you look into Fluke and Tech, I think it's really more important to sort of think about, you know, one is a, Tektronix is a wonderful brand, great technology, but plays in markets that are not as geographically diverse. They're really the innovation centers of the world and very focused on the R&D engineer for the most part. A more focused business, and this has traditionally and historically not been as durable as Fluke. When you look at Fluke, a great business, superior free cash flow, and in many respects, looks like our recurring rev businesses, right? High gross margins, high operating margins, Rule of 40 business plus. The caricature of the two businesses, both great businesses, but different. And I think they fit well with the future of both businesses. So when we think about Fluke's presence, its free cash flows, and really, you know, when you think about the geographic expansion of the business, when you think about the markets that Fluke plays in, they've been the sort of starting point of almost all of our recurring revenue. It was from Fluke that we've got eMaint. It's from Fluke we started with, ISC and Intelex. It's from Fluke that we started in AHS. In Fluke Health, it's where we started with Landauer. So the breadth and depth of Fluke's business around the world and in so many different markets gives us tremendous domain expertise in which to build our recurring revenue platform. And so that's the strategic capability of Fluke, and it plays a very important role going forward, and it financially fits extremely well with the businesses that are in new Fortive. Relative to transaction, and Tech is a great business, and I really think when you think about PT going forward, more of a through-cycle grower, the markets they play in are outstanding. They just have a little bit of cyclicality to them, right? We play in electrification, we play in mobility, we play in AI and data centers. These are great markets, but they do, because they're technology investments, customers tend to make those investments in a slightly more volatile way. And we think where PT is going relative to the direction of their markets, it's gonna be a very investable business for folks who really will get excited about that, and there will be a lot of them. Relative to the transaction, the spin versus split, we really think the spin is the best direction here. It provides more certainty. It gets us to a destination faster. So we really chose the spin. We have obviously a lot of advisors on this. We ourselves have been through these decisions. We feel really good about the spin decision here, relative to the best way to unlock value here. And again, you know, that doesn't preclude anything coming in that people wanna talk to us about. We expect those conversations to happen, but we really like the spin to unlock value here, and that's where our effort and energy is gonna be over the next several months. Great. And Nigel- Yeah. Nigel, just to be clear, it is a straight spin of the PT segment. Oh, yeah. Wouldn't expect anything- Yeah. In and out. Yeah. Thanks, thanks, Chuck. Thanks for clearing it up. And then, Chuck, maybe I know, I know it's early days, but can you put some boundaries around public company costs? Maybe, you know, the one-off transaction costs we should expect and, you know, the tax kind of structure. Does breaking apart the company sort of damage the sort of the tax efficiencies you created? ... You know, I expect the tax efficiencies, you know, to remain largely intact. I think that's the easiest one. I think, you know, Julian asked about similarities to Vontier. That's probably not a bad place to start, although, you know, we like to do better, you know, and so I'd expect us to try and aim for less, you know, stranded costs than what we saw in Vontier, and which were minimal. And from the one-time cost, not really, there's a lot of things early days to put a number on that, but, you know, it'll be consistent with what we saw in there or what other companies see, and we would expect to look through that. Although, you know, we're always trying to minimize cost and maximize cash flow, so you can count on us to do that. Great. Thanks, Chuck. Thank you. Next question is coming from Joe Giordano from TD Cowen. Your line is now live. Hey, guys. Good morning. Hey, Joe. So I think, like, if you polled investors, like, a lot of the reason for some of the, you know, the lack of an unlock of value is more like strategic and then on a perception of M&A. So, like, I'm just curious, when you thought through this, like, would the outcome have been tremendously different if you just kept the business the same, announced the leadership transition, and said that, "Hey, the next $2 billion of our free cash flow is gonna go to buybacks?" Because, like, there's a lot of examples of companies out there that have businesses that don't necessarily have, like, operational synergies, but the stocks have different valuations. Just curious as the thought of, like, could we just keep the business together and announce kind of the same changes without breaking the company up? Obviously, we evaluated all kinds of options, including what I would call the option you described, or maybe it's more like a status quo option with some slight changes to it. We got through intense assessment and dialogue and debate with our board and with advisors. We got to the conclusion of this being the best. I would say the two principal ways to think about that are: we're unlocking the value of the growth capability of the two businesses, one being a very strong growth company, high recurring revenue, and the other being a through-cycle growth company. I think, as we've had in, not only our own evaluation, but conversations with investors, we always get into the conversation of, "Well, why isn't the recurring revenue making you more durable?" Or, you know, "Where's the cyclicality?" And now you have two choices. You have very investable, great businesses, great financial profiles, wonderful opportunities for capital allocation in ways that unlock value, and, you have those two choices. And I think that, that's certainly what it comes down to and, and where we got to, and we're really excited about it. And we happen to have two outstanding leaders who know how to run those kinds of businesses, right? Tammy has come up through the ranks at, at Tektronix. She's run PT for several years. She understands those businesses. She's accelerated innovation in those businesses and knows how to unlock value the way I just described. Olumide comes from the world of recurring revenue. He knows how to drive that, those levels. And so we also have two leaders perfectly fit for this spin. So, you know, the stars are absolutely in alignment relative to the strategic intentions here, and or the strategic rationale, rationale rather, as well as the leadership to be able to run those things to maximize value. And that's, I think what, when we get to the final assessment of everything with us and the board and everybody, we're incredibly excited about what the future can hold for both businesses. And then just correct me if I'm wrong, it sounds like the strategy at RemainCo is fairly similar to the strategy of current iteration of Fortive. Like, is that a fair statement? And if so, like, what gives you confidence that that strategy works better in this iteration of the asset base? And then, Chuck, I don't know if you mentioned, like, any thoughts on the capital structure and the debt allocation to either of the vehicles? Thanks. So first of all, I would say it is different. I would say there's two things. One is you're at 50% recurring revenue here, and the domain expertise that we have in those businesses is gonna accelerate recurring revenue, and the focus organically and inorganically, as we said in the prepared remarks, would be focused on recurring revenue. The capital allocation strategy for Fortive going forward is really a more balanced approach, and we think we can unlock tremendous value with that balance. And you get the compounding of EPS and free cash flow, which, quite frankly, we've done an excellent job of doing already. We'll now be able to unlock that at an even better pace. As you know, we've averaged 14% EPS growth over the last five years. We've averaged 17% compound annual growth rate on free cash flow, and we think this new Fortive can do those kinds of things and better with a higher organic growth rate, with a higher total growth rate. So, strategy, certainly a lot of the things as part of the strategy are gonna stay the same. We're gonna accelerate innovation. We're gonna continue to apply FBS to drive our commercial capability. But there's some new here, too, and that's really important. And I think on the PT side, as I said, they're gonna return more cash to shareholders, more, most likely, and have a through-cycle growth rate and investment that plays with that. And I think we've got two great, very investable businesses to do that, and there are differences from where we've been in the past. Chuck? On the capital structure, as I said before, both are gonna, we're aiming for investment grade. Unlike the Vontier spin, we're not going to lever up the NewCo. We were targeting with the share buybacks a nominal some delevering between now and spin, so the company should come out with net leverage around 1.4-1.7. So that's what we're expecting for both companies. Thanks, guys. Thanks, Joe. Thanks. Thank you. Next question is coming from Andrew Obin, from Bank of America. Your line is now live. ... Yes, good morning. Morning. Good morning. Congratulations on all the hard work getting done. Thank you. Just a question: how do you think about the composition of the board, for Fortive and the spinco, specifically for Fortive? A lot more healthcare, a lot more software. Do you think the existing board is up to the task, or do you need - do you think because, you know, the weighting of the business has changed quite a bit, it's sort of less industrial, you do need a new board to sort of think about strategy differently? I think we have a great board, and you know, we'll. We're always evaluating new opportunities. We're gonna lose a board member in a year, that'd be me, and add Olumide. So I think you, you'll get more software and experience in Olumide. So that's a net add for sure. And we'll have, you know, we'll always evaluate where we have new opportunities for board members. We do that on a regular basis. Relative to the NewCo board, we've been through that process. You know, your Tammy and myself, and we'll recruit a chair, and then the two of them, and with some help from our current board members, we'll help them recruit a board. And that's we've been through that process. I think it's an exciting company. I wouldn't anticipate any challenges finding folks who wanna be a part of that, a part of the board. So, you know, we've got two really exciting companies here, and I think the clarity of strategy here is always, is gonna give us even better opportunities to bring great board members. But I would just. Andrew, we have built a board who has tremendous software experience. A number of folks have good healthcare experience as well. You know, Dan and Alan, obviously from the Danaher days and Wright Lassiter. So we've got good healthcare experience as well on the board. And, I would, if I'm speaking for the board, I would say we're always looking to see where we, you know, we... That's why we do a board assessment every year to see what new skills we'll need, and over time, we'll always think about adding folks who can be additive to our strategy. Just a follow-up question. You know, and I appreciate your frustration with the stock valuation, given the growth parameters and gross margin of the businesses. You know, some of your peers have gone a route of sort of unlocking value through sale of businesses. Why not do that? Why break up the company? As you know, as I said previously in a couple of versions of the same question, we evaluated a number of ways to unlock value. We think this is a great way to do it. You know, a lot of those things have lots of implications that, you know, having the experience of twenty-some years of buying and selling and spending and those kinds of things, we know the pitfalls of some of those things, and so we'll run very hard towards the spin, as I said before. That doesn't preclude anyone from doing something, and that's always a possibility, Andrew. We really believe that we've got a very investable business, with great brands and the strength of the strategy, as I've articulated already, and we think that's got tremendous ability to unlock value. Now, thank you, and I appreciate how much thought and hard work went to making this decision. Congratulations. Thanks, Andrew. Good to talk to you. Thank you. Next question is coming from Jamie Cook from Truist Securities. Your line is now live. Hi, good morning, and congratulations. I guess just two questions. One, you know, understanding over the next sort of eighteen months, the priority is going to be, you know, buying back stock. I'm just wondering, you know, being on the sideline for, you know, sorry, the next, you know, 15 M onths or so, what that sort of means about your view on sort of the M&A pipeline. Did it disappoint relative to your expectations? And just how, you know, some of the larger acquisitions like EA are performing relative to your expectations. And then my second question is, obviously a nice positive that you guys reiterated your guide today, given, you know, the macro still seems to be, you know, fairly mixed or challenged. Understanding you, you reiterated your guide, are there is there anything different in terms of how things are performing, even though you're reiterating your guide, some businesses performing better or worse relative to expectations, understanding you're still getting to the same point? Thank you. Thanks, Jamie. You know, I think number one, or maybe on the second part, just relative to where we think things are at. Obviously, we reiterated our guide. I won't get into too much detail. September is always a big month, but we obviously reiterated. I wouldn't say, you know, we're seeing too much different than what we've seen. So, consistent conversation from our Q2 call is probably where I would leave it. And as we said, we reiterated both the quarter and the full year. You know, on the M&A pause, first of all, I think the timeframe will go quickly. I think my experience of doing this is that, you know, when we say, you know, a certain amount of time in 12 or 15 months, whatever, it seems like a long time, but it's here before. And in M&A terms, that's not as, you know, with things that typically take 3 to 4 to 5 months anyway, that's not a tremendous amount of time at the end of the day. And, you know, we know the pipeline, quite frankly, while it's been full, you know, the transaction activity is still, in terms of numbers, has still remained pretty slow. And I think that has to do with buyer and seller expectations still, that we've talked about over the last couple of years here, remaining different in a number of markets. So, there's been some ramp-up of M&A activity, but there's been no groundswell. So we, you know, we'll continue to cultivate, we'll continue to talk to folks. We won't shut down, but we will take a pause here for sure, and we feel fine with that. And relative to EA, I think consistency is what we talked about, and very consistent with maybe the conversation around technology markets. We think these markets are really strong long term. I think we believe in electrification, we believe in mobility, but they are taking a pause. And you know, I think you've seen some of that, you know, certainly from some of our peer companies as well. But we think the long-term nature of where EA plays, the strategic rationale of its importance, its strength of technology, its breadth of solutions, and its ability to link with Tektronix, all of the strategic rationale is absolutely there, and when these markets come back, we'll be well positioned to take advantage of them. Thank you. Thank you. Thank you. Next question today is coming from Joe O'Dea from Wells Fargo. Your line is now live. Hi, good morning. Thanks for taking my questions. Hey. I wanted to ask about the recurring revenue in sort of Remainco, Fortive. And just, you know, as you think about the growth profile of the business, can you elaborate a little bit more on how you think about the recurring portion versus the non-recurring portion? And then, any details around that recurring portion, it looks like roughly half software, half non-software. But if you can explain that non-software piece a little bit and growth there versus the software side. Yeah. The biggest remaining part of the recurring revenue is consumables, and that's principally in healthcare, right? So that's at ASP and it's Fluke Health. Those are the two principal areas of consumables. And they're growing. You know, I would say the software, by and large, is high singles and low double-digit growth, and the consumables is in the mid to high single-digit growth, so both very good. So you take that sort of recurring revenue number and think of it as a high single-digit growth part of the portfolio going forward. And we feel really good about our ability to continue to build on that, too. I think when we look at the overall recurring revenue, it was, as we've said for Fortive, since we started getting into recurring revenue half a decade ago, it would always pull up the growth rate of the overall company. The advantage of that is it's now 50% of the business rather than 35% of the business. You know, the ability to make meaningful impact in Fortive in terms of its overall growth rate is, you know, 30, 30-plus% higher than it is in today's Fortive structure. Oh, that makes sense. That's helpful detail. And then, also, just in terms of leadership plans, can you talk about the logic around when AHS leadership moved to Tammy, and now, you know, that will eventually be under Olumide. You know, what your thinking is around the timing of that transition and giving him some runway, you know, with sort of oversight of that business before the spin takes effect? Yeah. Well, we have a great transition plan with Tammy and Olumide and myself. And you know, we'll transition the health business to Olumide at the start of the year, and he and Tammy will work the transition. We found over time that it's clear that you know, the opportunity for them to sort of for Olumide to learn the business while Tammy continues to run it is a good transition. And Tammy will be full-time sort of PT starting at the beginning of the year and focused on getting PT ready for public life. Great. Thanks a lot. Thank you. Thank you. Next question is coming from Deane Dray from RBC Capital Markets. Your line is now live. Thank you. Good morning, everyone. Hey, Deane. Hey, I just wanna make sure I understand what the messaging was here on page six. And I don't know if it's a nuance or not, but you say for Remainco, the shift, the focus from through cycle growth to total growth. Just like, what are the implications? And maybe kind of put some context around that. Yeah, I think it's very much around the fact that with that through cycle comment has mostly to do with the businesses that are in PT. With the elimination of that, we'll just talk about our growth rate and not through cycle. You know, it won't be that. It'll really about what the growth rate is going forward. So the implication or the is really less of an implication than a direct statement, that we're just gonna look at the growth of the company, because we think this is a really strong growth company, and with recurring revenue, becomes more durable. So it's really that. The consistency is there in a way that we can take out that through cycle commentary. You notice on slide seven, that with PT, we still use that through cycle comment because it's gonna, you know, as we said, over the last, I think five years, we've had about a 5% growth rate at PT, if you look back five years, but that's been through cycle, right? So, obviously, a year like this year is less than that. So, that's really the determination and the difference between the two slides and the commentary on the slides, Deane. Great. And then just as a follow-up, can you just provide some further color on the why now? And just, you know, some thoughts that come to mind, did missing out on National Instruments, did that factor into this? I know that's a hypothetical. How much did the board weigh the ongoing stock underperformance? And was there an activist involved, in prodding and moving this decision? Yeah, a lot to unpack there. I would say the process was very much, really internally started by us. The board was hand in hand with us relative to how we thought about this. We really continued to look at, as I sort of said, the fact that, you know, when you really look at it, we know that, you know, we've had tremendous financial success over the last five years, but that inherent value hasn't showed up in the stock price. And we always ask our question, always ask the question, what can we be doing differently? And I think we really saw in 2024, maybe the new news is, we definitely started to see the cycle within PT, and so that, I think, gave us further confidence that this commentary, relative to your first question, meant that we could really, we really were getting two businesses, and the ability to sort of set that up that way, the way we've got it, was really gonna be an exciting way to think about how we build two great growth companies. And it's, you know, I would say on the activist question, no activists. That's a simple answer there, so this is very much an internal process. We've always said we're deep believers in continuous improvement. Anything we can do to make the portfolio better, that's why we have a portfolio and strategic assessment of the business every year. I think the one thing you can say consistently about us over the last eight years is that we've always asked ourselves, how can we be better? And, I think this is a manifestation of that, and we're really excited about it. Great. Thank you, and best of luck. Thanks, Deane. Thank you. Our final question today is coming from Andrew Buscaglia from BNP Paribas. Your line is now live. Yeah, thanks for squeezing me in, guys. You know, so, you know, just piggybacking on what Deane asked. You know, last year, you made one of your biggest deals ever with EA, seemed very committed to that space. And, and I'm wondering what changed in the fact, you know, in, in terms of, you know, if something, you know, you see something structurally challenging in that test and measurement market where you don't wanna play anymore, or is there more competition than you anticipated? Just wondering, like, what, what changed so quickly in the last, I don't know, three, six months? It's really a year, right? We started working on EA earlier than, you know, over a year ago. So I'd say just for context- Mm. I would say the change is exactly what we've been talking about, which is, it's not really as much of a change, is that we love these markets. They're we're our ability to compete and take market share has never been better. Our strategic offering, the breadth of what we're doing is really good, but it's got some volatility to it because these markets have a little bit more volatility to it. That doesn't mean they're bad markets. We know electrification, we know mobility, we know a number of these markets are gonna be great growth over a decade, but they are gonna have some volatility to it. As I mentioned, they have a little bit less geographic diversity. They're more related to technology investments that go into semiconductors, that go into batteries, those kinds of things. And those have a little bit of cyclicality to it. I think the recognition, EA is a great business. As I mentioned in Jamie's question, it's a great business. It's really got great technology. It's the center, we're ahead on the synergies, but the market has taken a pause, maybe more so than we thought when we originally bought the company. The strategic rationale for EA remains intact, and it will be a great addition, a great part of PT going forward. So, you know, we've always said we would take opportunities over the last several years to make all of our businesses better. EA is all about that. But I think as we step back and look at those markets and where they're at, we also look at the ability to be durable on the other side of the house relative to where Fortive's going. And we really got to this fact that we're really in a great position here to create two great growth companies, one with more durability, but it doesn't mean that they're not great growth companies in totality. Thank you. We've reached the end of our question and answer session. I'd like to turn the floor back over to Jim for any further closing comments. Well, thanks, Kevin, and thanks everyone for taking the time. I know this was a little bit of a short notice call. We appreciate the questions and appreciate all of your support as we move forward here. We're in a great place. I couldn't be more excited. On behalf of the board, we're really excited. It was a unanimous decision around how to take these businesses forward. As I mentioned, we've got two great leaders that I know all of you know, but we'll have more of an opportunity to see here in the coming weeks and months, and I think the more you get to know both of them, the more excited you're gonna be about their leadership capability and their ability to lead these two great businesses into the future. FBS will be an important component of both companies. We've got two leaders who deeply understand our continuous improvement culture, and we'll take that forward as well. And we're really excited. Chuck and I appreciate all the time and we've spent with all of you over the last eight years. We're not going anywhere. We're gonna continue to work feverishly every day for you and all that you need. So feel confident that we're not going anywhere for any period of time, and we'll look forward to seeing you down the road. So thanks. Have a great day. We'll talk to you soon. Thank you. That does conclude today's webcast and teleconference. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.