Today, everyone, and welcome to the second quarter 2025 HP Incorporated earnings conference call. My name is Tina, and I will be your conference moderator for today's call. At this time, all participant lines will be in a listen-only mode. We will be facilitating a question-and-answer session toward the end of the conference. Should you need assistance during the call, please signal a conference specialist by pressing the star key followed by zero. As a reminder, this conference is being recorded for replay purposes. I would now like to turn the call over to Orit Keinan-Nahon, Head of Investor Relations. Please go ahead. Good afternoon, everyone, and welcome to HP's second quarter 2025 earnings conference call. With me today are Enrique Lores, HP's President and Chief Executive Officer, and Karen Parkhill, HP's Chief Financial Officer. Before handing the call over to Enrique, let me remind you that this call is a webcast, and a replay will be available on our website shortly after the call for approximately one year. We posted the earnings release and accompanying slide presentation on our Investor Relations web page at investor.hp.com. As always, elements of this presentation are forward-looking and are based on our best view of the world and our businesses as we see them today. For more detailed information, please see disclaimers in the earnings materials relating to forward-looking statements that involve risks, uncertainties, and assumptions. For discussion of some of these risks, uncertainties, and assumptions, please refer to HP's SEC reports, including our most recent Form 10-K. HP assumes no obligation and does not intend to update any such forward-looking statements. We also note that the financial information discussed on this call reflects estimates based on information available now and could differ materially from the amounts ultimately reported in HP's SEC filings. During this webcast, unless otherwise specifically noted, all comparisons are year-over-year comparisons with the corresponding year-ago period. In addition, unless otherwise noted, references to HP channel inventory refer to tier- one channel inventory, and market share references are based on calendar- quarter information. For financial information that has been expressed on a non-GAAP basis, we've included reconciliations to the comparable GAAP information. Please refer to the tables and slide presentation accompanying today's earnings release for those reconciliations. With that, I'd now like to turn the call over to Enrique. Thank you, Orit, and thank you to everyone for joining today's call. Against the backdrop of a highly dynamic landscape, we delivered another quarter of solid top-line growth driven by continued momentum in the personal systems commercial business. However, due to additional tariff costs that could not be fully mitigated in the quarter, our non-GAAP operating profit fell short of expectations. Today, we will take a deeper dive into Q2 performance, the evolving external environment, and our outlook. I will also highlight new innovations we introduced to drive our momentum forward. Let me start with our Q2 results. Overall, we delivered revenue growth for the fourth consecutive quarter, with a 5% increase in constant currency year-over-year. We saw strong growth in personal systems, particularly in commercial and high-value categories, driving momentum in our key growth areas. These meaningful results show that our future of work strategy is working. Nonetheless, the rapidly changing external landscape, including shifting trade policies and additional tariffs, had a net impact of approximately 100 basis points on our non-GAAP operating profit, mainly in April and primarily impacting personal systems. This resulted in a roughly 12% impact on our non-GAAP earnings per share. By net impact, we are referring to all tariff-related impacts after taking into account the mitigation actions. We swiftly responded to these changing market dynamics and were able to partially offset them in the quarter through cost actions, pricing, and accelerating the transition of our manufacturing footprint. We continue to diversify our manufacturing locations so that we can best respond to geopolitical changes with agility. We have expanded our manufacturing footprint for both PCs and printers to different locations, and we recently increased our production coming from Vietnam, Thailand, India, Mexico, and the U.S. By the end of June, we now expect nearly all of our products sold in North America will be built outside of China, significantly accelerating our previous plan. However, it takes time and investment to fully mitigate such impacts. Let me now share more color on our business unit performance. In Personal Systems, revenue grew 8% in constant currency, above our expectations, driven by strong commercial performance. PC commercial revenue grew 9% year-over-year, including strong growth in North America and Asia. As expected, we saw continued strength in AI PC demand and the Windows 11 refresh, and we believe that momentum will carry forward. We drove share gains year-over-year in commercial PC, particularly in premium, workstations, AI PCs, and gaming. We drove growth in services, with several new wins in healthcare, financial services, and retail. Personal systems operating margin came in below our guidance, largely due to higher tariffs that were not fully offset by our actions in the quarter. We expect to successfully mitigate these costs and return to our long-term target range of 5%-7% next quarter. In Print, revenue declined 3% in constant currency, in line with our expectations. We saw revenue growth across home and office in Europe, helping to offset a slowdown in North America and continued weak demand in China. We continued to drive momentum in home, with units up 2%, fueled by strong Big Tank growth. We grew share year-over-year in developed markets, optimizing profitable share mainly in office A4 value and A3. In our key growth areas for print, we saw continued growth in consumer subscriptions and workforce solutions, and we drove another quarter of growth in industrial graphics, supported by the portfolio launched at drupa, confirming the high adoption of our new product introduction. Our focus remains on what we can control, executing with discipline, supporting our customers, and making strategic decisions that position HP for the long term. Now, let's turn to the significant strides we made in innovation. This quarter, we advanced our strategy to lead the future of work by delivering experiences that help businesses grow and employees find greater professional fulfillment. At our global Amplify conference in March, we deepened relationships with over 1,100 partners and customers. We unveiled more than 80 new products and services, and the positive reactions from attendees reaffirmed our direction. A key highlight was the global rollout of the HP Workforce Experience Platform. Combining AI with real-time insights, this software solution enables CIOs to boost productivity and address issues before they disrupt work. Feedback from our early adopters has been incredibly positive, highlighting the platform's impact on workplace efficiency and its role in improving employee satisfaction. To accelerate the adoption of AI and bring its benefits to the mainstream, we introduced one of the most comprehensive AI PC portfolios in the industry. This portfolio features the redesigned HP EliteBook and EliteDesk, engineered to help people work smarter and faster while keeping their data secure. To enhance advanced workflows for data scientists and AI developers, we teamed up with NVIDIA to launch the HP ZGX AI Station, a high-performance workstation powered by Blackwell and designed to accelerate productivity and enhance security. In print, we are leading the way in security with our new LaserJet Enterprise devices, the first printers in the world designed to guard against quantum computer attacks. Our industrial print team received five prestigious European Digital Press awards, recognizing our bold vision to lead the industry for automation, productivity, and sustainability. In April, we brought our latest generation of technology to life, engineered to simplify production and optimize printing processes. Paired with our Print Hub software, print shops can now drive greater efficiency and control from a single platform. This innovation played a pivotal role in our recent collaboration with Scuderia Ferrari, where we co-engineered a high-performance car wrap that's up to 14% lighter and 17% thinner, translating breakthrough technology into real-world speed. The advancements across our entire portfolio this quarter demonstrate our leadership in creating a secure and powerful AI stack that connects devices, data, and workflows to drive meaningful productivity. In Q2, we acted quickly to address tariff-related headwinds, taking decisive steps like accelerating our manufacturing rebalancing, redesigning our logistics network, shifting sourcing, and qualifying new product configurations. These efforts both strengthened our operational agility and laid the foundation for continued resilience. We will carry this momentum into Q3 and Q4 as we further reinforce our supply chain and operational capabilities. Additionally, we have implemented price increases to help offset cost pressures. While these decisions are never taken lightly, they are essential to maintaining our financial discipline. Looking ahead, the remainder of fiscal 2025 will be shaped by a range of factors, some of which remain uncertain. We have planned for today's tariff landscape, and if it changes, we will respond swiftly as we did in Q2. We continue to expect the PC market will grow in 2025, but softer than originally planned, driven by increased macro uncertainty. That said, we remain confident in our ability to grow faster than the market and gain share. In Print, we continue to expect the market to decline low single digits for calendar year 2025. We expect the actions we are taking to gain full traction in the second half, leading to sequential operating profit improvement. We are making progress with the execution of the future-ready accelerated plan that we announced last quarter, and we are now expecting to exceed our goal and deliver at least $2 billion in gross annual run rate structural savings by the end of fiscal year 2025. These incremental structural savings will help mitigate macro and geopolitical uncertainties while continuing to support investments in strategic areas. We are confident in our ability to navigate an evolving market. We have always excelled in managing complex environments. We have an incredible team capable of optimizing processes, implementing best practices, and achieving global efficiency. As we move forward, we remain committed to delivering sustainable growth and creating long-term value for our shareholders. Our focus on harnessing the power of AI to make work more personal, productive, and fulfilling will drive our success now and into the future. Let me now hand it over to Karen. Thank you, Enrique, and good afternoon, everyone. We delivered another quarter of solid top-line growth driven by continued momentum in the personal systems commercial business, aligned with our vision of leading the future of work. We executed our strategy across multiple fronts, including growing share and high-value categories across personal systems and print, driving momentum in our key growth areas, and exercising disciplined cost management while continuing to invest in strategic initiatives. However, against the backdrop of a dynamic geopolitical landscape, our non-GAAP operating profit fell short of expectations due to additional tariff costs that could not be fully mitigated in the quarter. As a reminder, our guidance for Q2 included tariffs in place at the time. While we planned for a range of scenarios in the quarter and we worked aggressively to respond to changes in the regulatory trade environment, the tariff increases announced in April were higher than expected. That said, as you heard from Enrique, we made meaningful progress expanding our supply chain and manufacturing footprint, and we accelerated actions on cost reduction and pricing. However, as we indicated last quarter, the full benefit of these mitigating actions can take a few months' lead time, depending on the scope. During the quarter, our operating margin was impacted by net tariff costs, mainly in personal systems. Taking a closer look at the details of the quarter, net revenue was up 3% nominally and 5% in constant currency, with growth across all regions. In Constant Currency, APJ grew 9%, Americas grew 5%, and EMEA grew 1%. While we made progress on the cost of goods reduction actions we started at the beginning of the year, gross margin at 20.7% was down year-over-year with increased tariff and commodity costs. We drove non-GAAP operating expenses down year-over-year to help offset, including driving future-ready cost savings, continuing disciplined cost management, and reducing variable compensation. All in, our operating margin of 7.3% was impacted by roughly 100 basis points due to unmitigated tariff and related impacts, mainly in personal systems. Below the operating profit line, non-GAAP net OI&E was flat year-over-year, in line with our expectations, with lower short-term borrowing costs offset by currency losses. Finally, with a diluted share count of approximately 956 million shares, our non-GAAP diluted net earnings per share was $0.71, reflecting the tariff and related impacts net of mitigations of approximately $0.12. Now, let's turn to segment performance. We delivered another quarter of solid growth in personal systems, with revenue up 7% nominally and 8% in constant currency, above our expectations and driven by higher commercial volumes and increased ASPs. We did see some demand pull forward, but estimate it was minimal, accounting for less than 1% of our revenue growth. As we signaled, we drove disciplined pricing action to help mitigate increased tariff and component costs and shifted mix toward premium categories. Momentum continued in our key growth areas, with strong performance in AI PCs, advanced compute, and workforce solutions. We also drove commercial unit growth of 11%, gaining share overall and in premium categories as the market momentum and refresh activity continued. Commercial revenue increased 9% year-over-year, with pricing actions and mix shift toward premium offset in part by currency impacts. In Consumer, our results reflect our strategy to rebalance our portfolio to a more profitable mix. We saw 2% revenue growth on lower volume through favorable pricing and mix shift, including share gains in gaming. Our operating margin in personal systems was 4.5%, below the range we guided at the beginning of the quarter and down year-over-year from higher commodity costs and tariff costs that were not yet fully offset by repricing and cost reductions. It's worth noting that excluding the impact of tariff costs, our PS margin would have been well within our 5-7% guidance range. Turning to print, our results were in line with expectations as we continue to focus on profitable unit placement. We increased our market share in high-value categories and drove overall hardware unit growth. Our key growth areas continued to gain momentum, including revenue and subscriber growth in consumer subscriptions and industrial growth fueled by both hardware and supplies. Across Print, revenue declined 3% in constant currency on supplies declines and hardware softness in North America. By customer segment, we grew consumer units 3% year-over-year, led by strong growth in Big Tank. In Commercial, revenue declined 3% year-over-year on a 2% unit decline. We continued our purposeful focus on profitable long-term unit growth, gaining share in the higher value categories of A4 and A3. Supplies performed as expected, down 3% in constant currency, and we drove favorable pricing and market share gains that were more than offset by installed base and usage headwinds. Yet we delivered strong print operating margins, up year-over-year and above the high end of our range, reflecting rigorous cost discipline and pricing actions, as well as the favorable impact of grant funding received in the quarter. We continue to execute our accelerated future-ready plan across process efficiency, automation, portfolio optimization, and operational excellence. As Enrique mentioned, we now expect to achieve cumulative gross run rate savings of at least $2 billion by the end of fiscal year 2025, with no change to our estimated restructuring charges of $1.2 billion for the program. These incremental structural savings continue to be a key lever to help offset macro and geopolitical uncertainties, while also continuing to fuel investment in our key growth areas and AI innovation, all designed to position us well for long-term sustainable growth. Now let me move to cash flow and capital allocation. Our cash flow from operations was roughly $38 million in the quarter. As expected, free cash flow was slightly negative due to the timing of payments for intentional inventory actions we took in the prior quarter as part of our overall tariff mitigations. Those payments resulted in a decrease in DPO and corresponding increase in our cash conversion cycle in Q2, also as expected. Lastly, we returned close to $400 million to shareholders through both dividends and share repurchases. A planned debt refinancing ahead of an upcoming maturity contributed to us finishing the quarter slightly above our target leverage range. In line with our stated policy, with a temporary increase in leverage, we limited our repurchase to offsetting stock compensation dilution. As we look ahead, we will continue to navigate a dynamic environment that may be impacted by a continuing evolution in global trade policy, broader macroeconomic trends, and the associated impact on customer demand. For that reason, we believe it is prudent to moderate our guidance for the second half of the year to reflect this. In our guide, we have accounted for the added cost driven by the current tariffs in place and associated mitigations, including leveraging our supply chain flexibility, future-ready cost reductions, and pricing actions. We were able to mitigate part of these costs in Q2, and we are confident that we will fully mitigate them by Q4. In Personal Systems, while we expect to continue to gain share, we now expect the PC market to grow low single digits for both the second half and full calendar year, given the uncertain macro environment. We still anticipate commercial PC catalysts, including the Windows 11 refresh and AI PC adoption, to drive solid revenue growth in the back half of the year. We expect the actions we are taking to offset the cost of tariffs to gain full traction in the second half, leading to sequential improvement in personal systems margins in both Q3 and Q4. In Print, we continue to expect the market to decline low single digits for the calendar year, with the second half of the year declining closer to mid-single digits, in line with industry experts. We also expect our operating margin to continue to be near the top of our 16%-19% long-term range for the year. Beyond the segments, we expect corporate other to be slightly higher, approaching $1.1 billion, as we integrate the operations of our Humane Asset Acquisition into our technology and innovation organization. With this all in, we now expect FY 2025 non-GAAP diluted net earnings per share to be in the range of $3-$3.30, and FY 2025 GAAP diluted net earnings per share to be in the range of $2.32-$2.62. Turning to Q3, in personal systems, we expect revenue to grow high single digits sequentially as we continue to see strength in commercial aligned with our future of work efforts and pricing actions. We expect personal systems margins in the lower half of the 5%-7% range, improving sequentially as a result of the mitigation efforts we are driving. In Print, we expect Q3 revenue growth to perform better than typical seasonality on incremental hardware placements and pricing actions. We expect operating margins solidly within our 16%-19% range as we continue to focus on profitable unit placement, tariff mitigation, and disciplined cost management. With all of this, we expect third quarter non-GAAP diluted EPS to be in the range of $0.68-$0.80, and GAAP diluted net earnings per share to be in the range of $0.57-$0.69. In line with our revised earnings, particularly in personal systems where we have a negative cash conversion cycle, we now expect free cash flow to be in the range of $2.6-$3 billion for FY2025. With regard to working capital, we expect our cash conversion cycle to also be impacted by the timing of purposeful actions we are taking to mitigate the fluidity of the tariff situation. It is important to note, however, that we not only expect the impact of these actions on working capital to be temporary, but as mentioned earlier, we also expect to fully mitigate the current cost of tariffs by Q4. On our balance sheet and capital allocation, given the impact of tariffs, we expect our leverage ratio to continue to be above our target range in Q3. That said, we remain fully committed to returning approximately 100% of free cash flow to shareholders over time, as long as our gross leverage ratio remains under two times and we do not see more attractive investment opportunities. In closing, we responded quickly to the changing market dynamics in the quarter to address headwinds from a rapidly changing trade environment. We remain focused on what we can control and are confident that the actions we are taking are the right ones to position us for long-term profitable growth. With that, I would like to hand it back to the operator and open the call for your questions. Thank you. We will now begin the question and answer session. To ask a question, you may press star, then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, press star, then two. We also ask that you please limit yourself to one question and a single follow-up. Our first questioner today will be Erik Woodring with Morgan Stanley. Please go ahead. Thank you so much for taking my questions. Enrique, maybe just to start, can you maybe add a little bit more context around your expectations for the PC market in the second half of the year? What is causing the guide down? Is it large enterprises weaker? Is it small enterprise weaker? Excuse me, SMB that is weaker? International markets weaker? You have talked about raising prices. I just love a little bit of context, a little more context on kind of PCs in the second half of the year, including any channel inventory comments. Big picture, does that just really mean that kind of Windows 11 refresher is really not a catalyst that we need to think about if we're going low single digits during the refresh period? A little bit more context would be helpful. I have a quick follow-up. Thanks. Sure. Thank you, Erik. Let me try to answer all the questions you have in your question. First of all, in Q2 and in the first half, we have seen strong demand on the PC side, especially in commercial, as reflected in our results. When we think about the second half, though, we thought it was important to be more prudent in the estimation that we have for the market, given a few of the trends that we see. First of all, we are today in a very different economic situation from where we were a few months ago in terms of both consumer and business confidence. Second, we have seen announcements across the industry for price increases in the second half, and we think the combination of both will potentially have an impact in the demand that we see. We are not integrating any effort from channel inventory. All of them are under control, are under good, in a healthy position. We think that the impact will be both for consumer and commercial. It is more a matter of prudency as we look at the second half more than we saw any trends in Q2 that we thought were going to be impacting the overall market size in the second half. Our plan and our goal is to grow share in that market. Of course, if the market is bigger than what we are expecting today, this should be reflected in our results. I would just add, Erik, that Windows 11 does remain a catalyst for the back half. If demand comes in stronger than our moderated guide, that will be reflected in our results. Okay. Great. I appreciate all of that color, guys. Thank you so much for that. Maybe a follow-up. Enrique, I would just love if you could give a little bit more kind of high-level color for your growth businesses. I think it would help us all better understand kind of two key metrics there. First, just when you add up all of the growth businesses that you allude to in your presentation, how big are they? What percentage of revenue or personal systems or print? Any color that you could share in the size there. And then how fast are they growing? I appreciate the commentary on sequential growth, but I assume many of these businesses have different seasonalities. Just how big are these businesses? How fast are they growing year over year? How should we think about growth of these businesses, say, over the next one to three years? We'd just love to get better context on that. Thanks so much. Thank you, Erik. We haven't disclosed the overall size of the businesses. Let me tell you the two key metrics we have shared before that continue to be true is they are growing faster than the core businesses, and the gross margin is also higher than the gross margin of the core businesses. These two key factors continue to be true. Within growth businesses, we include businesses like AI PCs, where we have seen very solid growth, not only quarter over quarter, but year on year. We said that our goal is for AI PCs to represent more than 25% of the PC business by the end of the year, and we are on track to meet that goal. Within growth businesses, we have also our workforce solution business on services and consumer services. Both of them have very solid growth in the quarter. Within growth businesses, we have workstations that had a very solid growth performance during the quarter, industrial print. Overall, they perform well. They perform as we were expecting, and they will be a significant part of why we continue to see the second half stronger than the first half, because they will continue to drive growth for the company. Got it. Thanks so much. Thank you, Erik. Our next question comes from the line of Michael Ng with Goldman Sachs. Please go ahead. Hi. Good afternoon. Thank you for the question. I have just two, both on personal systems. First, just on personal systems margins, it's encouraging to hear that you'll return to the long-term range next quarter. I was just wondering if you're assuming that you'll be in that 5-7% range for the full year as well, and what are some of the key swing factors that you're watching for? And then secondly, I was just wondering if you could comment on whether you saw any personal systems demand pull-in in this past quarter ahead of any prospective tariffs and the current outlook there. Thank you. Yeah. Thanks, Michael, for the question. In terms of PS margins, yes, we do expect for margins to be in the 5-7% range for the full year. Given the impact in Q2 for the full year, it's likely to be in the lower half of that range, but with good sequential improvement. I mean, in terms of pull-in, we saw some pull-in in the PC space into Q2, but at the overall level, it's fairly small. Our estimation, having looked at shipment data, sellout data, is that less than one point of growth was driven by pull-in. So it's a relatively small number overall. Of course, if we look at North America sales, it would be bigger because it will represent a bigger percentage. Again, overall, at the company level, it was less than 1%. This is the case for PCs. We did not see any pull-in for print. Thank you, Enrique. Thank you, Karen. Our next question comes from Asiya Merchant with Citigroup. Please go ahead. Great. Thank you very much. A couple of ones. One on just AI PCs. I know you are still pretty bullish on AI PCs, but if you can just help us understand what are some of the killer applications that you hear from your end customers on this makeshift towards AI PCs. Within your expectations for PS systems growth, how should we think about the impact of pricing and makeshift towards these AI PCs within your overall growth expectations for that segment? I have a quick follow-up. Thank you. Thank you. Overall, as I said before, we are very pleased with the progress that we see in AI PCs. Our goal is that there will be more than 25% of the mix of PCs by the end of the year, and this continues to be the case. In terms of key applications, what we have seen is a large number of software companies introducing solutions that utilize the capabilities of AI PCs. We have more than 100 ISVs supporting that now, and this number is only growing. This is why we think that the penetration is going to continue to grow, because if you are in the commercial space and you buy a PC today, you want to be able to take advantage of those capabilities as software will be available. That is the key message we make to customers. As you can see from the progress we are making, it is resonating. In terms of the impact it will have, you're correct, it will have an impact on average selling price. The goal that we have shared before is that they will represent around 50% of the total shipments of PCs three years after introduction, so about two years from now. We are on track to make that number. On average, they are between 10-20% higher price than regular PCs, but this, of course, will have an impact on the total value. Something relevant to highlight this quarter is that we introduced AI PCs for the mainstream. This was one of the major innovation announcements we made in Q2 that is going to continue to help to drive adoption and to drive growth in this category. Okay. If I may, thank you for that. If I may, on just free cash flow, I understand PCs are a negative cash conversion cycle and hence affecting, but just if you can help us understand the free cash flow margins ticking down a little bit in terms of your guide, that would help a lot. What are the drivers for that? Thank you. Yeah. No, thanks for the question. Our free cash flow guide that we revised does follow earnings. In line with that earnings guide, we did reduce our free cash flow expectations for the year, but it is mainly driven by the reduction that we saw in earnings, which is really driven by the operating margin impact that we had this quarter. That, along with lower than expected working capital improvement, is what caused us to guide down. We still do expect working capital improvement, but just a little lower than we had anticipated, given the fact that we're focused on doing everything we can to offset these trade-related costs. I would say it's important to note, though, that these working capital moves are temporary, and they are purposeful actions, really, as we mitigate the fluidity of the situation. Let me maybe provide some color on the working capital side. As we have said in the prepared remarks, we have diversified our supply chain. We have built factories in different places. To operate those factories now, we need more working capital than we did in the past. Over time, we will optimize, and we will make them more efficient. This is why Karen was saying this will be temporary, but we see an immediate increase now as the supply chain has become more diverse. Thank you. Our next question comes from Wamsi Mohan with Bank of America. Please go ahead. Yes. Thank you. I was wondering if you could share a little more color on some of the mitigation impacts that you're putting in place. How much of this tariff impact do you expect to offset from pricing? Maybe some thoughts around what those price increases could look like and which areas of the market you would be targeting versus cost actions versus potentially moving supply chain. Any quantification there would be helpful, and I will follow up. Let me provide more color on that, and maybe Karen also wants to complement. We have taken a lot of actions during the quarter to mitigate the change of the trade environment. Let me start by we accelerated the shift of factories out from China into Southeast Asia, into Mexico, to a certain extent in the U.S., to mitigate the impact of the change. A quarter ago, we shared that our goal was to have less than 10% of the products in North America being shipped from China by September. We have accelerated that, and we shared that now almost no products will be coming from China sold in the U.S. by June. There is a very significant acceleration of the plan that we had. We have also changed our logistics network. For example, we have removed the U.S. as a distribution hub for products that will be going to Canada or Latin America, which will avoid them having we will avoid us having to pay tariffs. We have also taken additional cost actions, as Karen mentioned in the call. Also, in a very targeted way, we have also taken price actions across the full portfolio, both in personal systems and print, to reflect the growth that we have seen. We have seen the market and the rest of the competitors taking similar actions across the two industries. We see this as an industry change that will be put in place at the end of Q2 and now in Q3. I would just add that we're not going to quantify what comes from price versus supply chain moves versus other cost actions. On our Future Ready program, we did talk about driving an additional $100 million more in savings. Those are really higher, we targeted higher goals for many of the savings opportunities that we were already working on. That included the consolidation of some of our teams under our new TIO organization, also driving more simplified management layers and locations, and reduction in IT applications throughout. As a result, these actions are now yielding more upside than we initially anticipated and will be realized sooner than planned. Lastly, I would just note, as we said before, that by the time we exit this year in Q4, we expect to fully mitigate the cost of these current tariffs. Okay. Thanks for that color. As my follow-up, you are actively moving the supply chain away from China, but you also noted areas like Vietnam, Thailand, Mexico, Philippines. What gives you confidence that your moves, given sort of we still don't know where reciprocal tariffs might end up, that these moves are going to be optimal? What are some of the things that you're thinking through, and how quickly would you be able to shift production between these areas as you think about what might happen potentially with reciprocal tariffs? Thank you. Yeah. I think you're right. We are in a fairly fluid environment, so I think I don't want to speculate on what could happen and what changes we will do. I think what you have seen is we have reacted very fast to the changes that we saw in April. We have been able to rebalance supply chain and accelerate some of the plans that we had. We will be fully compensating for that in about two quarters by Q4, as Karen just said. We will respond in a similar way to whatever changes happen going forward. We will look for the opportunities, we will optimize the supply chain, and we will respond swiftly to those changes. Thank you very much. Our next question is from Samik Chatterjee with JP Morgan. Please go ahead. Question. Maybe if I can start off with the print margins in the quarter, again, very solid margins. Maybe if you can just help us with sort of the driver of the margin outperformance you had there, how much of it that is, maybe some business drivers versus the Future Ready cost actions that you're taking. Particularly in relative to the guidance you have for 3Q, you talked about above seasonal revenue growth as well, but you're moderating the margin expectations. Is there a certain one-off driver there that we should think of, or is that more just in terms of business mix to sort of really play out in the quarter? I have a follow-up. Thank you. Yeah. Thanks, Samik.