As a reminder, today's program is being recorded, and now I'd like to introduce your host for today's program, Kris Rosemann, Senior Manager, Corporate Development and Investor Relations. Please go ahead. Good morning and welcome to our first quarter 2024 earnings call. I'd like to thank everyone for joining us this morning. With me today is Aaron Jagdfeld, President and Chief Executive Officer, and York Ragen, Chief Financial Officer. We will begin our call today by commenting on forward-looking statements. Certain statements made during this presentation, as well as other information provided from time to time by Generac or its employees, may contain forward-looking statements and involve risks and uncertainties that could cause actual results to differ materially from those in these forward-looking statements. Please see our earnings release or SEC filings for a list of words or expressions that identify such statements and the associated risk factors. In addition, we will make reference to certain non-GAAP measures during today's call. Additional information regarding these measures, including reconciliation to comparable U.S. GAAP measures, is available in our earnings release and SEC filings. I'll now turn the call over to Aaron. Thanks, Kris. Good morning, everyone, and thank you for joining us today. Our first quarter results were ahead of our prior expectations due to higher-than-expected C&I shipments, favorable input costs, and strong operational execution. We are reiterating our overall 2024 outlook this morning for net sales, adjusted EBITDA margin, and free cash flow conversion, which York will discuss more in detail later in the call. Year-over-year, overall net sales increased slightly to $889 million. Residential product sales increased 2% as compared to the prior year quarter, as strong growth in home standby generator shipments was partially offset by a decline in certain other residential product sales. Global C&I product sales decreased 2% from a strong prior year period, as a robust increase in shipments to our industrial distributor customers mostly offset weakness in the domestic rental and telecom markets. Significant year-over-year margin expansion and disciplined work in capital management helped drive a substantial improvement in free cash flow generation from the prior year, while we continue to invest in our strategic initiatives. Home standby shipments were in line with our prior expectations during the quarter, increasing at a mid-teens rate from the softer prior year period that included a meaningful headwind from excess field inventory levels. As expected, shipments and activations were aligned exiting the first quarter, signaling that field inventory levels are reaching more normalized levels. The removal of the excess field inventory headwind is expected to support strong year-over-year growth in home standby generator sales in the coming quarters. Power outage activity in the U.S. during the first quarter was approximately in line with the longer-term baseline average, as higher outages in January were offset by lower outage activity in the months of February and March. Activations, which are a proxy for installs, declined modestly from the prior year period, reflecting the softer outage environment over the last several quarters and resulting in weaker home consultation performance specifically in the fourth quarter of 2023. Home consultations did increase sequentially during the first quarter but declined on a year-over-year basis from a very strong prior year period. For historical perspective, home consultations in the first quarter were modestly higher than the first quarter of 2022 but were more than 3.5x higher than the first quarter of 2019. Additionally, we experienced moderate sequential improvement in close rates during the first quarter as we continue to execute initiatives that we believe will drive further increases beyond this year, including data-driven lead optimization practices, sales tool enhancements, and improved lead nurturing practices. We are also making ongoing investments in engaging with our end customers and bringing awareness of the category to new and broader demographic categories to expand the overall sales funnel for home standby generators. We ended the first quarter with our residential dealer count at approximately 8,800, a net increase of 100 dealers during the period. We have also been experiencing good traction with non-dealer contractors, as we have seen steady increases in the number of installers in our Aligned Contractor Program, an effort that helps us better strengthen these relationships and improve our installation bandwidth while allowing contractors to purchase product through their preferred channel. We will continue to invest in growing our network of installers, including both dealers and non-dealer installers, as well as in the tools and teams to support and optimize these distribution partners, which we view as a key competitive advantage for our business. Our teams have also continued to make incremental operational improvements within our home standby production facilities. These improvements contributed to the margin expansion that we experienced in recent quarters, and this momentum bodes well for future growth and profitability. We believe we are emerging from the recent field inventory challenges with a continued focus on quality and execution, as well as an improved competitive position. We will continue to leverage our unparalleled scale and strength in manufacturing, sourcing, marketing, distribution, and our strong financial profile to drive growth in the home standby market in the years ahead as we grow the number of consumers engaging in the category, expand our industry-leading omnichannel distribution network, invest in customized sales processes and tools to drive close rates higher, and expand the broadest product portfolio in the market. While home standby shipments were in line with our prior expectations during the first quarter, however, our overall residential product sales were lower than expected due to continued softness in global portable generator shipments, as well as weaker domestic energy storage and EV markets, and continued post-pandemic related challenges with the market for Chore products. We expect these specific softer end market conditions to impact our overall residential product category sales growth for the full year 2024, but our expectations for home standby generator shipments are unchanged relative to our prior guidance. Now moving to our residential energy technology products and solutions, our Ecobee team continued to drive year-over-year sales growth in the first quarter despite a challenging retail environment as performance with professional contractors remained strong. Ecobee's number of connected homes and services attached rate also experienced positive momentum during the quarter. Importantly, Ecobee's gross margin improved meaningfully on a year-over-year basis, primarily due to cost reduction initiatives and improvement in electronic component supply chains relative to the first quarter of 2023. Within our residential clean energy product suite, we continue to make progress on key product development objectives. And additionally, fleet health of our installed base has materially improved after substantially completing our warranty upgrade program in 2023, and with a continued laser focus on improving the quality of these products and solutions. We are also moving forward in our partnerships with the Department of Energy as we work to bring clean power generation and resiliency to Puerto Rico via our residential energy storage systems and through our participation in the Grid Resilience and Innovation Partnership Program in Massachusetts, which demonstrates our ability to integrate multiple technologies to support a home's energy needs while also providing additional value for grid operators. Finally, we remain excited about our collaboration with Wallbox as we will begin shipments of the company's best-in-class EV charging solutions during the second quarter. We continue to expect that the investments we're making to develop residential energy technology solutions will generate attractive returns in the years to come. Our teams are focused on deep integration of the products and platforms we have acquired while tightening our focus on building high-quality solutions where we believe we can create the most value for the consumer. With improved focus and execution, and by leveraging our core competencies around sales and marketing, lead generation, distribution, customer support, and global sourcing, we believe we can create competitive advantages that will become evident over time as we continue to develop the smart energy home of the future. Switching gears, I now want to provide some commentary on our C&I products. Global C&I product sales declined 2% from the prior year, which was ahead of our prior expectations, driven by a decrease in sales to domestic telecom and rental customers, partially offset by continued growth in our North American industrial distributor channel and certain industrial or international markets. As a result of the strong first quarter outperformance, our expectations for full year 2024 C&I product sales are now higher. Shipments of C&I generators through our North American distributor channel again grew significantly in the first quarter. Quoting activity remained resilient in the quarter, and we continued to drive market share gains within our core product lineup. In addition, our operational execution helped to reduce lead times during the quarter. As expected, shipments to national telecom and rental customers declined in the quarter from the strong prior year period. Consistent with our prior expectations, we believe these end markets will remain soft in the coming quarters. However, despite the cyclical weakness in the rental channel, we continue to believe this end market has substantial runway for future growth, given the critical need for future infrastructure projects that leverage our products. Additionally, leveraging our 40 years of experience serving the telecom market, we are confident in our ability to capture the future growth potential around the secular trend of increasing global tower and network hub counts and the increasingly critical nature of wireless communications and services that require significantly greater power reliability. Shipments of natural gas generators used in applications beyond traditional standby projects declined moderately during the quarter as the higher interest rate environment impacted project ROIs and timelines. Longer term, we view these applications as an important opportunity for Generac, our end customers, and grid operators as reliability concerns, energy prices, and market volatility all trend higher. Additionally, we will continue to build a pipeline of multi-asset projects that utilize both our natural gas generators and our recently introduced C&I energy storage systems. While we are in the early innings of the growth opportunity, we intend to leverage our leading position in natural gas generators to drive market share gains in behind-the-meter energy storage in the coming years as our C&I customers seek to utilize energy storage for short-duration outages, variable rate arbitrage, and grid service opportunities, while also leveraging our traditional generator offerings for a complete resiliency solution. We believe we are uniquely positioned to bring these solutions to market and continue to invest in the teams, technology, and processes necessary to deliver comprehensive solutions for the C&I market focused on energy resilience and efficiency. Internationally, total sales were lower year-over-year, primarily related to declines in intercompany shipments from our Mexican operations to the telecom market in the U.S., as well as lower shipments in certain European markets, most notably for portable generators, as energy security concerns eased relative to the first quarter of 2023. Strong growth in shipments to Latin American end markets partially offset this softness. Internationally, international adjusted EBITDA margins held at 15%, consistent with the prior year period, as disciplined price cost actions were offset by lower operating leverage on decreased shipment volumes. In closing this morning, we are encouraged by the ongoing improvement in operational execution reflected in our first quarter results, as strong year-over-year performance in home standby generators and increased shipments of C&I products to our industrial distributor customers offset end market softness in other areas of our business. The return to our historically robust gross margin and cash flow generation profile allows for additional capital allocation optionality and further strengthens our confidence in executing our Powering a Smarter World enterprise strategy. Additionally, the recent acceleration in data center construction activity, driven in large part by the emergence of artificial intelligence, has further increased the growing pressure on electricity supply-demand imbalances and underscores the relevance of the megatrends that underpin our enterprise strategy. Data centers will not only directly increase industry-wide demand for backup power, but have also served to raise public awareness of the looming electrical grid supply constraints. Accelerating demand for artificial intelligence and the deployment of energy-intensive data centers join the growing trends of electrification and the reindustrialization of North America, which is driving power consumption forecasts meaningfully higher than previously forecasted. At the same time, grid operators continue to add intermittent power generation sources and retire baseload thermal generation, while also facing extensive siting and permitting challenges, as well as critical equipment shortages. After multiple decades of very little electrical growth in electrical demand, the aging power grid in the U.S. is clearly not prepared for the future trajectory of power consumption needed to satisfy these converging trends. This is even before considering the long-term trend of increasingly frequent severe weather events that are creating additional stress on the nation's electrical grid. Generac's backup power portfolio, in particular, is well positioned to provide home and business owners with the continuity and resilience they demand in an increasingly electrified world. In addition, our next generation energy technology solutions across both residential and C&I product categories will further expand on our resiliency value proposition by helping optimize for efficiency, consumption, comfort, and cost. We believe our broad offering of products and solutions are uniquely capable in helping home and business owners solve the challenges resulting from this accelerating energy transition. I'll now turn the call over to York to provide further details on our first quarter results and our updated outlook for 2024. York. Thanks, Aaron. Looking at first quarter 2024 results in more detail. Net sales increased to $889 million during the first quarter of 2024, as compared to $888 million in the prior year first quarter. The combination of contributions from acquisitions and the favorable impact from foreign currency had an approximate 1% positive impact on revenue growth during the quarter. Briefly looking at consolidated net sales for the first quarter by product class. Residential product sales increased 2% to $429 million as compared to $419 million in the prior year. Growth in residential product sales was primarily driven by a mid-teens increase in shipments of home standby generators. This was partially offset by a large decrease in portable generator shipments in the U.S. and Europe, given a strong prior year comparison, ongoing softness in the domestic solar plus storage market, and lower Chore product sales. Commercial and Industrial product sales for the first quarter of 2024 decreased 2% to $354 million as compared to $363 million in the prior year quarter. Foreign currency and acquisitions contributed approximately 2% growth in the quarter. The core sales decline was due to the expected weakness in sales to our domestic telecom and national equipment rental customers. This performance was largely offset by a robust increase in C&I product shipments through our domestic industrial distributor channel and growth in certain international markets, including Latin America. Net sales for other products and services increased slightly to $106 million, including approximately 1% contribution from favorable foreign currency. Gross profit margin was 35.6% compared to 30.7% in the prior year first quarter due to a favorable sales mix given stronger home standby shipments, improved production efficiencies, lower input costs, and higher pricing as compared to the prior year. First quarter gross margins exceeded our prior expectations as a result of better than expected input cost realization and strong operational execution. Operating expenses increased $21 million or 9% as compared to the first quarter of 2023. This increase was primarily due to ongoing investment in our teams to drive future growth and higher marketing spend to create incremental awareness for our products. More specifically, research and development expenses grew at a rate approximately double that of our overall operating expenses, highlighting our ongoing evolution to an energy technology solutions company. Operating expenses for the quarter were in line with our prior expectations as we execute strategic initiatives to drive long-term growth. As a result of these factors, adjusted EBITDA before deducting for non-controlling interests as defined in our earnings release was $127 million or 14.3% of net sales in the first quarter as compared to $100 million or 11.3% of net sales in the prior year. I will now briefly discuss financial results for our two reporting segments. Domestic segment total sales, including inter-segment sales, increased slightly to $720 million in the quarter. Adjusted EBITDA for the segment was $99 million, representing a 13.8% margin as compared to $68 million in the prior year or 9.4% of total sales. International segment total sales, including inter-segment sales, decreased 14% to $187 million in the quarter as compared to $216 million in the prior year quarter. Foreign currency and acquisitions contributed approximately 4% sales growth in the quarter. The approximate 18% core total sales decline for the segment was primarily driven by declines in inter-company shipments from our Mexican operations to the domestic telecom market, as well as lower shipments in certain European markets, most notably for portable generators. Adjusted EBITDA for the segment before deducting for non-controlling interests was $28 million or 15% of total sales as compared to $32 million or 15% of total sales in the prior year. Now switching back to our financial performance for the first quarter of 2024 on a consolidated basis. As disclosed in our earnings release, GAAP net income for the company in the quarter was $26 million as compared to $12 million for the first quarter of 2023. The current year period includes a $6 million non-cash expense that reflects the change in the fair value of our warrants and equity securities in Wallbox, a minority investment we made in Q4 of 2023. GAAP income taxes during the current year first quarter were $12 million or an effective tax rate of 31.2% as compared to $8 million or an effective tax rate of 35.7% for the prior year. The decrease in effective tax rate was primarily driven by higher pre-tax book income that reduced the impact of certain discrete tax items in the current year. Diluted net income per share for the company on a GAAP basis was $0.39 in the first quarter of 2024 compared to $0.05 in the prior year. The current year period included a $2.7 million redemption value adjustment that impacted our earnings per share, while the prior year period included a $9 million redemption value adjustment. Adjusted net income for the company as defined in our earnings release was $53 million in the current year quarter or $0.88 per share. This compares to adjusted net income of $39 million in the prior year or $0.63 per share. Cash flow from operations in the quarter in the current year first quarter was a positive $112 million as compared to negative $19 million in the prior year first quarter. Free cash flow as defined in our earnings release was positive $85 million as compared to negative $42 million in the same quarter last year. The significant improvement in free cash flow was primarily due to higher operating earnings, a reduction in primary working capital in the current year quarter, and a large one-time cash tax payment in the prior year period, which did not repeat. Total debt outstanding at the end of the quarter was $1.56 billion, resulting in a gross debt leverage ratio at the end of the first quarter of 2.35 x on an as-reported basis, a continued reduction from the 2.5x at the end of 2023. With that, I will now provide further comments on our updated outlook for 2024. As disclosed in our press release this morning, we are maintaining our overall outlook for net sales and adjusted EBITDA margin for the full year 2024. For our top-line sales outlook, we still expect overall year-over-year growth to be approximately 3%-7%, which includes a slight favorable impact from acquisitions and foreign currency. However, we now expect a slightly lower mix of residential products and a slightly higher mix of C&I products compared to our previous expectations. As Aaron previously mentioned, we are not changing our outlook for home standby generator shipments for the full year. As field inventory for home standby generators normalizes and we start shipping in line with the end market, we continue to expect a significant year-over-year increase in home standby generator shipments. However, other residential products are facing softer end market conditions than previously anticipated. As a result of lower expectations for global portable generator shipments, continued softness in domestic energy storage and EV markets, and weakness in Chore product sales, we now expect the full year growth rate for residential product sales to be in the low double-digit range as compared to the mid-teens growth rate previously projected. Offsetting this incremental softness in residential end markets, we now anticipate C&I product sales to be higher than previously expected, resulting in a mid to high single-digit rate decrease versus prior year as compared to our prior guidance for an approximate 10% decline. This improved outlook is primarily driven by the higher than expected shipments to our domestic industrial distributor customers in the first quarter. Specifically for the second quarter, we expect overall net sales to be nearly flat as compared to the prior year period, with growth rates anticipated to accelerate in the second half of the year. Importantly, this guidance assumes a level of power outage activity during the remainder of the year that is in line with the longer-term baseline average. Consistent with our historical approach, this outlook does not assume the benefit of a major power outage event, which could add 50-100 million in additional shipments during the year. Our gross margin expectations for the full year 2024 are now modestly higher than previous guidance given the Q1 outperformance. We now expect gross margins to improve by approximately 300-350 basis points over the full year 2023, an increase from the 300 basis point improvement previously expected. Gross margins are projected to increase sequentially throughout the year, with second half 2024 gross margins now growing by approximately 200 basis points over the first half 2024 gross margins, given favorable mix, price, and cost impacts. Adjusted EBITDA margins before deducting for non-controlling interests are still expected to be approximately 16.5%-17.5% for the full year. This guidance assumes that the better than expected gross margins previously discussed will be mostly offset by modestly higher than expected operating expenses to help support enterprise-wide strategic initiatives. As a result, we now expect second half adjusted EBITDA margins to be approximately 450 basis points higher than first half EBITDA margins, driven by the combination of gross margin expansion and operating leverage on higher sales volumes in the second half of the year. This compares to the previous expectation of nearly 600 basis points of EBITDA margin improvement from the first half to the second half of the year. As is our normal practice, we are also providing updated guidance details to assist with modeling adjusted earnings per share and free cash flow for the full year 2024. For the full year, our GAAP effective tax rate is still expected to be approximately 25%-26% as compared to the 25.2% full year GAAP tax rate for 2023. This is expected to result in a GAAP effective tax rate of approximately 25% in each of the remaining three quarters of the year. Importantly, to arrive at appropriate estimates for adjusted net income and adjusted earnings per share, add-back items should be reflected net of tax using our expected effective tax rate. Interest expense is now expected to be approximately $90 million-$93 million as compared to prior guidance of approximately $85 million-$90 million due to an increase in interest rate expectations for the remainder of the year. This guidance assumes no additional term loan or revolver principal prepayments during the year. Our capital expenditures are still projected to be approximately 3% of our forecasted net sales for the year. Our overall cash flow generation guidance remains unchanged. Operating and free cash flow generation is still expected to follow historical seasonality of being disproportionately weighted toward the second half of the year in 2024. For the full year, we continue to expect adjusted net income to free cash flow conversion to be strong at approximately 100% as we continue to monetize working capital builds of prior years. Depreciation expense, GAAP and intangible amortization expense, stock compensation expense, and diluted share count expectations also remain consistent with last quarter's guidance. Finally, this 2024 outlook does not reflect potential additional acquisitions or share repurchases that could drive incremental shareholder value. This concludes our prepared remarks. At this time, we'd like to open up the call for questions. Certainly. Ladies and gentlemen, we ask that you please limit yourselves to one question each. You may get back in the queue as time allows. One moment for our first question. Our first question comes from the line of Tommy Moll from Stephens Inc. Your question, please. Good morning. Thank you for taking my questions. Tommy. Aaron, starting off on home standby, wanted to see if you could reconcile for us. I think I heard you say shipments are up mid-teens year-over-year. Activations are down year-over-year. Can you just help us understand the two of those in context? Yeah. So it's a great question, Tommy. I mean, activations have been a little slower this year relative to if you look at the outage environment most recently, the last couple of quarters, that outage environment has been weaker than kind of the trend over the last, I would say, couple of years. So Q1 was actually in line with the long-term average since we've been tracking outages. But again, you look kind of trend-wise, it was a relatively quiet quarter. You get past January, things really slowed down in February and March. And then Q4, as we discussed previously, was a really light quarter relative to kind of historical trends, so. In Q1 in the last year. Yeah. Q1 last year of 2023 was really strong for a Q1. So kind of a tougher comp that way. So activations were a little bit down. But yet shipments are up because, again, the field inventory headwind is largely gone now, right? So we exited the quarter. Really kind of February, March run rates, activations, and shipments were in line with each other. So we think that's a really good sign that we're kind of at a point of stasis with field inventories in terms of them returning to normal, which has been the primary headwind here. So as that abates, that helps us in terms of comping more strongly on shipments. But yet the activations being a little bit softer as a result, I think, of the most recent outage periods. The field inventory drag was a bigger drag last year than it was this year's quarter. That allowed for the year-over-year increase in shipments. Exactly. Thank you both. That's helpful. I'm not sure if we're limited to one, but I'll turn it back. Thanks, Tommy. Thank you. One moment for our next question. Our next question comes from the line to George Gianarikas from Canaccord Genuity. Your question, please. Hi. Good morning. Thank you for taking my question. Hey. Good morning, George. I was wondering, you talked about the tangential impacts of the surge in data center power demand. I was wondering if you could discuss maybe a little bit more in detail your strategy there and any incremental you've seen demand directly from the needs of AI data centers? Thank you. Yeah. Thanks, George. Our product range is typically underneath the range of products that are being used purely for backup for the data center market. That's a market that they use very large blocks of power. That's dominated on a direct basis by the large diesel engine manufacturers that are out there. There's a handful of them in the world. They sell all the major data centers on a direct basis. We don't have a product like that. We don't have any plants that develop an engine range. Those are engines that get used in tugboats and mine haul trucks and trains and things like that. So much different applications than what you'd see just outside of power generation. That said, we do serve some of the edge data centers where the power needs for backup are not as great. We also have seen some opportunities come across relative to natural gas backup. Today, the backup generator market for data centers is almost entirely diesel, again, driven by these large diesel engine players. We are seeing issues around siting and permitting with certain large concentrations of diesel engines. In Virginia, as an example, there's some high-profile areas where permitting has been challenging to obtain for the kinds of the raw numbers of diesel engines that have to be sited and permitted to operate for backup. Some of these data center EPCs and owners have turned to natural gas as a potential option. Now, the blocks of power are smaller because natural gas doesn't have the density in terms of energy as you see in diesel fuel. Nonetheless, the emissions are quite a bit cleaner, the emissions profile of those products. So that could be a potential opportunity. We continue to grow our natural gas generator line in terms of total output for those products. So we think there could be opportunities, but we think they're primarily going to be smaller edge data centers. Probably the bigger opportunity, George, is indirectly, right? The amount of data centers that are going to be coming online here between now and 2030, so call it five, six years. It's estimated that the amount of power that will be drawn from those data centers will triple from the current levels that we're at today. It's almost the equivalent like if you step back, if we get to 2030 and if that happens, it's the equivalent of adding 40 million households to the grid. So if you just process that for a second, I mean, in terms of just the raw number of the raw increase in demand that's going to come from these data centers in a very short period of time. For those of you who have been around the utility industry or even the energy industry for any length of time, you know that it's really challenging for grid operators and utilities to react quickly because there's a process involved, right, for, again, siting and permitting of new plants, the approval process through different regulatory bodies. Then, of course, what are you going to what is the generating capacity you're going to add? Most likely today, it's going to be intermittent, right? It's going to be solar or wind at a utility scale. You can do that cost-effectively to get to the nameplate rating of a thermal plant, but unfortunately, those are intermittent sources. So you need to have a different strategy with how you're going to operate on a 24/7 basis. So you either need to add storage of some sort, which is quite a bit more expensive, obviously. And that would obviously have to be passed along to rate payers. Or you've got to come up with a different approach, virtual power plants, other grid services types programs to help offload demand during peak times or to augment supply during those peak times with distributed assets that might be out there and available on the grid. We're definitely seeing much greater interest with grid operators and utilities in these types of conversations and programs. But again, many times they're bespoke. They're highly customized. There's complicated processes to get these programs up and running. So it's just going to take time. Data centers and the data center operators are not going to wait. The opportunity with AI is just it's far too great. It's coming at us very, very quickly. We think that structurally, what that's going to result in, just on a net basis, is reduced quality of power. I just don't think that we even have a remote inkling of what's going to happen over the next 5-10 years in terms of power quality. It's clear to me that what we're going to see here in the future is a critical degradation of power and shortages. These are not weather-driven outages, although those will happen because the grid continues to be susceptible to weather. But it's really this supply-demand imbalance that's going to continue to grow. As on the supply side, we're dealing with replacing traditional 24/7 thermal assets like coal and gas with intermittent assets like wind and solar. And then on the demand side, we're racing to electrify everything. And we're adding all of this additional load profile from data centers. So it's just not a great setup for power quality in the years ahead. Thank you. One moment for our next question. Our next question comes from the line of Mike Halloran from Baird. Your question, please. Hey. Morning, guys. Hey, Mike. Hey, Mike. Hey. So just digging a little deeper in the C&I side of things, sounds like pretty similar outlook for the rental and telecom channels. Maybe talk to two things here. One, how you're thinking about the seasonality for the businesses in the areas where the outlook has improved, and then also the confidence in the sustainability of the run rate, and so more the distribution side, some of the other areas, and any kind of evidence you would point to for the sustainability piece and why you think that might have some nice legs here relative to what you were thinking a couple of months back. Yeah. Thanks, Mike. So our C&I business has continued to perform quite well in the face of, as you noted and as we've been noting for quite some time now, the cyclical slowdown that we're experiencing in the rental markets as well as the telecom markets, which, again, guidance for rental and telecom are largely unchanged for the year. Really, the change has come from our industrial distribution channel, which is, again, they're serving businesses. They're serving the infrastructure like wastewater treatment plants and school districts and other types of applications, a very wide range of applications, healthcare manufacturing plants, even data centers, as I mentioned before, data and telco outside of the strict telecom market that we talk about oftentimes on a direct basis. But that industrial distributor channel for us has been a growing channel for really the greater part of the last decade. We've invested heavily in it. We've done some acquisitions along the way where we've been able to attack some of the markets where we felt we were underrepresented from a market share standpoint around the U.S. We've infilled that with owned distribution, if you will. And that playbook has worked out quite well for us. And we've been able to pick up share is really kind of flat out the answer. So it's coming in stronger. It's been very resilient, right? We haven't necessarily seen the breakdown there. And I think that's representative of the broader power quality discussions that we've been having here and have had for some time, right? Whether you're talking about the supply-demand imbalance that I just prattled on about or just the continued challenges with reliable supply and also just the deeper electrification within businesses, right? I mean, businesses today, without power, you can't operate. We used to point to certain markets or certain applications that were "critical" for backup power. I would say almost every business today would say they critically rely on a continuous source of power. So without that, whether it's inventory spoilage or whether that's an interruption of revenues, significant disruption to their businesses exists when you get these outages. And outages over time have been on the rise. And I think you're just seeing that manifest itself in a broader penetration rate for backup power in these buildings that represent the C&I market in North America. And we've been very pleased with the resiliency there. And so that's largely offsetting the cyclical weakness that we were forecasting here for rental and telecom. And we're saying, "Hey, look, we like the trends for that industrial distributor channel continue to be pretty solid. Quoting's hanging in there. Quoting's hanging in there. The quote to sale conversion process has continued to hang in there. We continue to invest in it. I think all of those things, when you line them up, are really what are helping us offset the broader weakness in those other markets. Thank you. One moment for our next question. Our next question comes from the line of Jeff Hammond from KeyBanc Capital Markets. Your question, please. Hey. Good morning, gentlemen. Hey, Jeff. Hey. So just back on residential one, maybe just speak to destocking and whether you think it's done, if not, how much left. And then it just seems like IHC activation trends were kind of still pretty weak. And so I just want to come back to, I know it was kind of in line in the quarter, but what gives you confidence in the unchanged view and kind of the ramp into the second half outside of just seasonality? Yeah. Yeah. Thanks. Thanks, Jeff. So yeah, from the destocking perspective, again, we exited the quarter. February and March, activations and shipments were pretty much in line. So we felt like and again, based on all the data we have and based on the extended period here of destocking that we've been experiencing really since the third quarter of 2022, we feel like we're finally through that. And so that's in line with our prior expectations. And that largely is behind, I think, the again, as I mentioned previously, the ability to kind of post those mid-teens increases year-over-year in home standby shipments. So we don't have that field inventory headwind now that that's primarily gone. In terms of the weaker trends recently here, activations and IHCs, maybe a little bit underneath what we were anticipating, but not dramatically off the pace. So we feel pretty good about seasonally. Frankly, January was a solid month with outages. February, March, not so good. In fact, February and March were really quiet. April, on the other hand, came back strong. And so you kind of get into the seasonal time frame here for these types of products. And we're seeing the kinds of upticks that you would expect to see in these key metrics that we track, both leading and lagging indicators. So we feel pretty good about that guide and hanging on to that guide for the year. I think that, again, we've said this, that the category itself is less sensitive to some of the interest rate movements and things that you might see in other typical, what you might call consumer discretionary types of categories. Power outages create, I think, they elicit a different response, right? I mean, it's an emotional category a lot of times. Also, the demographic that's traditionally buying these products, these are they skew older. It's older Americans with their homeowners. The aging-in-place trends that we've talked about previously are very much intact. And I think that these are homeowners that are just less sensitive to movements in interest rates. It doesn't mean around the edges that we won't see decreases, market demand decreases. And I think that's largely played out here in the back half of last year as I mean, interest rates have been high now for a while. This isn't a new phenomenon. So I think whatever impact that higher interest rates may have had on the margins, on the edges of the market, we think that's largely baked in at this point. I do think that, again, just thinking forward to the balance of the year, I'll just also point out that the Colorado State University hurricane forecast was, I think it was, what was it, the most active year forecast ever? Ever. I mean, we don't. Preseason forecast. Personally, we don't tend to put a lot of stock in those forecasts because I have a hard time believing that if you can't tell me what the weather's going to be next Saturday, how can you tell me what it's going to be in September? But again, I think we're looking at longer-term trends around air temperatures, water temperatures, the relaxing of the El Niño events. I think those are things that are important to how forecasters think about the long-term, the bigger cycles around things like hurricanes. So that's coming as well. But our guidance assumes baseline outage activity. It doesn't assume any majors. And I think that I think it's important also to mention the category is seasonal. So the second half is always stronger than the first half. So you would, if you're assuming baseline level of outage activity, you would expect a nice sequential increase from first half to second half in that home standby business to support our guide. Thank you. One moment for our next question. Our next question comes from the line of Brian Drab from William Blair. Your question, please. Hi. Thanks. I was wondering if we could just focus in on energy technology for a minute. I'm looking at the slide from the investor event last year. About 40% of the incremental revenue between 2023 and 2026 in the bridge here is from its incremental revenue from energy technology and C&I and residential. Can you just give us an update on how you feel about capturing that $700 million incremental revenue and what's the updated outlook, C&I and resi? Thanks. Yeah. Thanks, Brian. So I mean, obviously, we gave those guidance points last fall. And we're not in a position today to update the next couple of years. But we can talk specifically to energy tech and how we're thinking about that. Obviously, the market for solar plus storage, the market for EV charging, the market for some of the products that are within that complex. I would say are weaker today, the near-term market dynamics are clearly more negative coming off of the pull ahead from NEM 3.0 in California and then just higher interest rates. I think the impact that that's having on those markets and then the demand for those products. So that's the negative news. The good news is we're still not in the market with our new products. And we're on target for our launch plans later this year. I think we're optimistic that as we turn the corner into 2025, look, interest rates are not going to remain high forever. And so I think and the NEM 3.0 pull ahead pull-in, I think it's pretty well documented that that seems like the market is finally kind of emptying itself of some of the channel inventory challenges that the OEMs that are providers to that market today have experienced here over the last several quarters. I think that's starting to abate. I think it's perfect timing. By the time we get into the market, I think the market's going to be where we need it to be so that we can start to see success. So I wouldn't say we're in a position today to think differently other than near term, right? And so near term this year, we're probably going to be a little bit on the low end of our range. Again, it's not a big part of our business today. So a small move. And that's part of the other residential products being softer that we talked about in our prepared remarks. Some of that is the solar plus storage and EV charging just being probably a little bit more muted here in terms of market demand in the short term. But again, if you're talking about over the next through 2026, for the next two or three years, we're just we don't think that that's probably going to change dramatically because I think the market's going to come back by the time we're in a position to participate in that. Thank you. One moment for our next question. And our next question comes from the line of Jerry Revich from Goldman Sachs. Your question, please. Yes, hi. Good morning, everyone. Hi, Jerry. Hi, Aaron. Aaron, can you just expand on the comments around gross margins in the quarter? We were pleasantly surprised. Sounds like the cost came in better than you expected as well. So what's the magnitude of improvement that you're seeing from supply chain normalization and going back to normal efficiency levels, freight normalization, and to what extent can that continue? Can you flesh out that part of the gross margin performance in the quarter and opportunity from here? Yep. Absolutely. Yeah. No, we were pleased with the gross margin performance. That did beat expectation. It was well over 1% increase there versus expectation. And the reality is we guided that input costs would improve throughout the year in 2024. The reality is we just saw the realization of that improvement sooner than we expected here in Q1. So that's great. So the fact that they came in ahead of sooner than expected. So we got the beat in Q1. And then I guess what that does, it just de-risks that assumption in the second half, that gross margin improvement that we expect from first half to second half. We're seeing it now. So it de-risks that assumption. So that's what's going on behind the gross margin beat. Thank you. One moment for our next question. Our next question comes from the line of Stephen Gengaro from Stifel. Your question, please. Thanks. Good morning, everybody. Good morning. So my question, I guess it's two parts. One is, has there been any change to the competitive landscape given that I think your biggest competitor has kind of been taken private? Then I guess maybe if you can kind of blend into that answer, just sort of the margin mix question. I imagine the strength in home standby relative to other residential products is a margin positive for the balance of this year. Any way to sort of quantify or think about that? Yeah. I mean, definitely, that is the case, right? I mean, the margin profile of the standby products for residential is greater than every product we offer here in the company, frankly. So it's a very strong margin product for us. And so the margin mix to that point would be favorable. Yeah. I mean, gross margins were up 5% year-over-year in Q1. I'd say half of that was a better mix as home standby grew mid-teens. Yeah. Yeah. Yeah. So that's played out. In terms of the competitive landscape, yeah, there have been a couple of kind of developments in the competitive landscape. As you mentioned, one of our competitors here is in the process, I think, of being taken private. They are being taken through private equity. They were a private company already. But being acquired by private equity as a carve-out of the bigger enterprise there, we don't believe that's closed yet or haven't been told it's been a closed transaction yet. But I mean, it's just seeing how that plays out. I mean, take private like that with kind of the debt load. We went through that when we went from privately owned to private equity owned back in 2006 time frame. It's different to operate a company with a high degree of leverage and a large amount of debt. So I think that'll if I were in somebody's shoes there, that's something that is an adjustment period and takes time to kind of work through. It's also a complicated carve-out of a 150+-year-old company. So that may be a complexity as well. I don't know that it'll impact the competitive landscape that much. I think where that company, where they compete quite well with us is on the C&I side of the business. And they've got quite a nice C&I business, good competitor there. On the residential side, they're quite a bit smaller. They may see opportunities there. But I think this is a place where we've done well, I think, to use our scale to our advantage. And that's, I think, largely why, as we said in our prepared remarks this morning, we actually think we've improved our share position here over the last several quarters. So we continue to spend heavily on driving leads for the category, driving awareness for the category, investing in our distribution, investing in our sales processes. And all of those things continue to provide nice returns for us in the way of continued gains in share and, again, a market opportunity that still remains really, I think, pretty huge. I think we've been doing this with home standby for a long time. But penetration rates are still only, what, 6.5%? 6.25. Yeah. 6.25%, increase. So I think for us, when you think of every 1% of penetration being kind of a $2.5 billion-$3 billion market opportunity, there's a ton of runway left here. And it's worth the it's worth being, I think, being a net investor here, if you will, in the category. Thank you. One moment for our next question. Our next question comes from the line of Donovan Schafer from Northland Capital Markets. Your question, please. Hey, guys. Thanks for taking my question. So, hey, I want to dig in and kind of unpack the industrial distributor channel a little bit because that was a positive development this quarter, offsetting some of the other C&I kind of subsectors or channels or however you want to call it. And, Aaron, you provided some good information about this is something you guys have kind of been building for the better part of the last decade. But it doesn't get a lot of discussion in terms of the mechanics and the kind of, I don't know, origin story or whatever. And so I want to try and get a handle on kind of its significance and some things. So the first thing would just be, can you give us a general sense of what portion of C&I revenue that can make up and then what portion of that would be distributors that you actually own? And some of this is also getting at the issue of, is this a case where stuff could get shipped to distributors but doesn't necessarily have an end user? And so you can have a channel buildup here. Or do the dynamics not work like that? So anytime something ships to a distributor and you recognize revenue, there's a project or an end user that's going to be taken delivery. Just how all that works and its size and significance? Yeah. I mean, it's a significant portion of our total domestic C&I sales. So, again, it's, I think, when you kind of step back, it's close to 70% of the total for domestic C&I. So it's 70%-75% of the total, with the balance being, again, the mobile products and telecom products. And, again, those are down largely here. So, as we've documented, they go in cycles. We're a big player in those markets in rental and in telecom. But when those large customers are not spending CapEx, that disproportionately impacts us because we supply a lot of equipment into those areas. So to have the industrial distribution channel grow as it has been is a really important, I would call it, counterweight, if you will, to some of those larger customers or larger concentrations of product and customers in rental and telecom. You're right. We don't talk a lot about the industrial distributor business, mainly because we spend an inordinate amount of time talking about residential, our consumer power businesses, and the residential standby and energy tech. But underneath the covers here, this has been, I think, a really nice success story. We've got a great team there that executes well. You may recall, Donovan, we announced that we're building a new factory here in Wisconsin in Beaver Dam because we believe in the growth of those products and the importance of that to our business overall. And it's an area where we needed some capacity. We've been building bigger and bigger products. We also did a pretty massive investment in our R&D space here in Waukesha, Wisconsin. This is our technical headquarters, specifically to go after larger opportunities in the C&I space and natural gas in particular and some of the things that we've been talking about with natural gas beyond standby kind of market opportunities. Even though that's cooled off here recently in the higher interest rate environment, we do think that that's really important. And I would say this. One of the things that maybe the unsung hero of our success, when the markets around telecom in particular, when they cycle on, one of the reasons that we've done well there is because we can provide kind of coast-to-coast coverage with our distribution to provide the kind of service and support that those large accounts demand for their fleets. And that's kind of a really important aspect of our industrial distributor channel. Again, the sales don't flow through there, but the service and support is a part of what they provide for us. So the two are kind of interrelated in terms of telecom and the IDC we call it our IDC channel, our industrial distributor channel. The products that go through IDC are very bespoke, highly customized. No two buildings in terms of their electrical requirements are the same. So we produce it's basically a configured-to-order business with a long sale cycle with quoting and then it turns into an order. And then you've got lead time for these products that can be anywhere from as short as 8-10 weeks and as long, in some cases, as out to 52 weeks, depending on the size of the products and the type of products. So there's a lot of influencers in the process from specifying engineers to even the architects that work on these projects and certainly the owner-operators, the electrical contractors, the general contractors. Everybody plays a role in selecting the solution that is needed for a particular application. So over the last decade, on top of building out that industrial distributor channel, the actual distributors themselves and strengthening that channel, we've been focused on engaging with all of those decision-makers up and down the value chain there. And I think that's really helped us quite a bit in terms of getting Generac specifically named in a specification. That's really important. If you're not specifically named, that becomes challenging for somebody to find your product or even your distribution on a particular bid project. So those are the things that I think engaging with those specifying engineers and that community and spreading the word about, in particular, the importance and the advantages of natural gas over diesel, which we're the largest natural gas genset provider for backup power in the world. And we hold an advantage there over others that we'd like to talk to distribution about. So I think that is part of, again, part of this story overall is natural gas backup power is growing more quickly than diesel backup power outside of the large data center market. I have to qualify that now. And that's not a part of the market we play in. So in the served market where we play, we're seeing gas growth rates exceeding diesel growth rates. And that's been the same for some time. And we're a beneficiary of that. And so is our distribution. So you're seeing all of that play out in that the strength that we're talking about here on the industrial distributor channel. Thank you. One moment for our next question. Our next question comes from the line of Kashy Harrison from Piper Sandler. Your question, please. Good morning. Thanks for taking the questions or question, I should say. So, Aaron, I think you indicated that HSB activations were down modestly year-over-year. Can you just help us quantify that? What does modestly mean? And then you also indicated HSB shipments and activations were aligned in February and March. And so I was just wondering if, York, you could just help us think through Q2 residential revenues. I'm just trying to understand how we get from being up 2% in 1Q to being up low double digits for the full year. Thank you. Yeah, Kash. So from an activation standpoint, I mean, modestly, it's kind of that mid-single-digit range, which is, again, not too far off of our expectations in terms of year-over-year. We just kind of expected it to be a little bit softer coming out of the, we had IHCs in Q4 were lower as a result of the weaker power outage environment. And, frankly, Q3, we really didn't have much of a season last year in terms of the outage environment. So kind of the back half of last year maybe didn't play out as strongly as it might have historically. And as a result, you see that play out in fewer installs here year-over-year in the quarter. But, again, not dramatically so, which I think is good. And I think when you look historically, the category is still up. It's up dramatically from where it was. Kind of you go to 2019 ranges, those levels of activations, and we're up significantly from that area. So the category is quite a bit bigger today than it was then. But I think just a little bit off near-term here from the weaker power outage environment in the last couple of quarters. Yeah. And then your comment about our residential sales from Q1 to Q2. I mean, we did in Q1, we still did undership the market. We were still bringing field inventory down, again, by the tail end of the quarter. And we get into Q2, we feel like we're back to normal for the most part. So we still did undership the market. If you recall, we undershipped 2023 by around $300 million. I guess I would say a quarter of that probably a little less than a quarter of that was what we undershipped the market in Q1 here. So we got back to normal. So you won't have that in Q2, that undershipping. And then just the seasonality of the business picks up from Q1 to Q2 in that category. So, again, you got to look back at what historical seasonality looked like. That, again, supports the guide for residential products in the future. Thank you. One moment for our next question. Our next question comes from the line of Jon Windham from UBS. Your question, please. Hi. Yeah. Thanks for taking the questions. I'll keep it quick as we're running a bit long. Just any sort of comments around you mentioned some weakness in the non-HSB residential market. But one of the really strong markets right now is storage deployments. Residential storage deployments are up 200% year-over-year in California. Just some comments about the competitive landscape and your ability to compete in that market. Thanks. Appreciate all the insights today. Yeah. Thanks, John. Yeah. So storage attach rates are up dramatically. Solar plus storage install rates, as we understand them, are certainly new solar projects are down significantly, 50%-60% year-over-year in California. And so you are seeing greater attachment rates because of the NEM 3.0 position. And that's where storage, I think you're seeing on just the absolute numbers are probably up because of that higher attach rate. California for us, that's a market largely dominated by Tesla. It's not a market that we've historically been strong in. So we're just we're really not participating dramatically in that. I will say, I mean, our storage business is up year-over-year. So it's not double. It's not 200%. But that's an area that we are seeing some growth off of a pretty hard bottom as we've described over the last several years. But actually, as we also called out, I think the bigger challenge in the other residential products actually was portable generators. We haven't talked a ton about that, mentioned in our prepared remarks, but both domestically because of the softer outage environment here over the last several quarters, and then internationally. International portable gen sales were down hard Q1 year-over-year. There was a lot of power security concerns in the year-ago quarter in Europe, largely related to the Russia-Ukraine war. And that's abated somewhat. And so we've seen the portable gen demand come off hard in the international markets for us, which is specifically kind of the European markets. And then our Chore business, which we don't talk about a ton, but that suffered. That's really suffered last year. The longer-term trends there coming out of the pandemic, there's a lot of kind of buy-ahead on equipment, both at the end market level as well as the distribution level. You can see all the public comps out there that are involved in this space on the residential Chore product space. It's been a pretty brutal market over the last really the last year and a half. We were hoping that if we got a little bit of spring weather here that was kind of built into the forecast, that that would be helpful. But what we found is distribution partners, they didn't sell through their snow season. It was a weak snow season, which with high snow inventories, they were reticent to invest in spring Chore products. That's been delayed a bit. Now, thankfully, weather's picking up here. Trends more near-term are a little more positive with Chore products. But it's still been a rough go. So it's really Chore and then those energy tech markets that have been softer and then the portable generator pullback that we talked about, which were kind of headwinds for us in the quarter. Thank you. One moment for our next question. Our next question comes from the line of Jordan Levy from Truist. Your question, please. Morning, Aaron. Thanks for squeezing me in. I appreciate all the comments on gross margins here. I just wanted to see on the cost side, if you could give us more specifics around what the input cost reductions were that you're realizing in the first quarter. As a quick second part of that question, just curious on the sensitivity of costs overall to copper prices, specifically given what that commodity has done over the last month or month and a half. Yeah. No, I think it's a number of things in terms of well, steel is probably our largest input. And those steel costs, I guess, over the longer term have come down. And as we've been turning through our higher-cost inventory, we're just seeing those lower steel costs come through, again, maybe a little bit faster than we originally anticipated. So steel is an important factor. Obviously, logistics, freight costs. While those came down throughout last year and, again, we're starting to turn through that inventory and the realization of those lower freight costs, we're starting to see that's part of the improvement. Just better plant efficiencies. I think that's better plant absorption. We're seeing that as well in terms of strong execution there. So I would say those are probably the biggest factors on sort of how we were able to realize the better gross margin faster than we originally anticipated. And copper, I guess copper, it does have an impact, but I would say it's less or so than. There's lags there. I mean. Yeah, to the steel side. Yeah. And so copper has gone up. But that, I would say, is in terms of lower impact relative to steel. Thank you. One moment for our next question. Our next question comes from the line of Vikram Bagri from Citi. Your question, please. Good morning, everyone. I wanted to ask about R&D expense, which increased noticeably in the quarter. I was wondering if you can share where the R&D dollars are being spent. In your answer to a previous question, you had mentioned that there are no plans of launching products that directly target the data center market. So I imagine R&D is being largely focused on energy technology. If you can share the progress on next-gen MLBE storage products, is the target to compete in that market at a lower price point with lower failure rates and ease of installation, or there are new features or USPs we should keep in mind that give you an edge against the competition in that market? And then lastly, you had mentioned OpEx will be roughly 23% of sales last quarter but wasn't mentioned today. Wanted to make sure the guidance has not changed given the R&D spending update and your comments on lead generation spending this quarter. Thank you. Yeah. On the last part, on the OpEx guidance, in our prepared comments, we did mention that the outperformance in Q1 on the gross margin would get roughly offset by a little bit higher OpEx. Again, as we continue to invest in those strategic initiatives, it's early. So we basically held the EBITDA margin guide where we had it from last quarter with the gross margin outperformance slightly offset by the OpEx side. Yeah. And then Vikram, on the R&D side, yeah, we're spending very heavily, largely a lot of those R&D dollars. I mean, it's across the board on all of our products, but obviously, the energy tech products. We are knee-deep in our next-generation storage devices on the residential side that we'll be bringing to market here later this year. And then, of course, our rooftop solar products, power generation products, inverter products that we continue to invest in. We have our next generation of those products coming to market in early 2025. So there's a tremendous amount of effort right now. We've been building teams. You may have seen our announcement. We opened a tech center in Reno, Nevada. We've been filling that with people. We've got tech offices in Portland, Maine. We've got tech offices in Vancouver. We've got tech offices in Bend, Oregon, in LA, in Denver. We've really cast a pretty wide net here as we build out the talent level needed to compete with, obviously, some very formidable companies there that supply not only storage but also on the inverter side. From a USP standpoint, again, we'll talk more about these product launches as we get closer. We believe we've got some novel approaches to certain elements of the tech. We also think that there's the integration of all of these products together more seamlessly. Today, if you want to put together a solar system with a storage device with an EV charger with thermostatic controls, with even a generator for longer-term backup, load management, all of these different devices, that's three, four, five different apps you've got in your hand. We're working on a project that is unifying all of these technologies on a single platform, really utilizing the Ecobee experience. That was a central part of our strategy in the Ecobee acquisition. The ML and AI that they deploy today in the thermostatic controls environment and the really high-quality user experience that they bring together, we want to bring that to all these products. And we think that'll be unique to the marketplace. When you look across the market today, we don't think anybody has the breadth of offering that we have and putting it all together on a single platform to help homeowners, in particular, to help them control not only resiliency, which is central to our approach here, but also comfort and cost, which are as electrical rates, utility rates continue to drive upward, cost is going to be, I think, one of these things that is going to creep up on rate payers in a way you're already seeing evidence of it in certain markets like California. It's going to drive homeowners to investigate other solutions, distributed solutions, solutions that help them give them more information and more control over the power that they generate, the self-generation that they store, that they export back to the grid, and the resiliency that they absolutely demand in their own homes. So I think that over time, this will become more evident as these products get into the market. But I think and with our brand and our distribution and our sales and marketing competencies, I think you're going to see that we believe we'll have success there in the long term. Thank you. This does conclude the question and answer session of today's program. I'd like to hand the program back to Kris Rosemann for any further remarks. We want to thank everyone for joining us this morning. We look forward to discussing our second quarter 2024 earnings results with you in late July. Thank you again, and goodbye. Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.