Fantastic. Well, next up, it's my pleasure to introduce Johnson Controls, Marc Vandiepenbeeck, the CFO. So thanks very much for being here, Marc. Thanks for having us. Yeah. Of course. And I think, you know, JCI had some news on an acquisition, so maybe just start off with the background on that and kind of what it brings to JCI's portfolio. Yeah. So this is really a capability acquisition. Alloy is quite an incredible firm with a team of engineering folks in Boston that really have created a differentiated technology to really combine manufacturing process and material technology to create differentiated solution for data center, but also for other mission-critical environment. The way that technology is gonna apply to JCI product line is specifically and to start with our CDU. We have a great product we launched about four-five months ago. The reception has been incredible. Mm. Our pipeline has now grown to almost $1 billion. We've booked order almost immediately after announcing the product. But today, if you look at the environment of CDU, there is some differentiation, but it's not as high as you would anticipate with 100 different player providing solutions. We think the Alloy technology with their Stack Forging capabilities will create a completely- Mm ... differentiated CDU offering and allow us to gain potentially a leadership position similar to what we have in the rest of the thermal chain. There's some application of what Alloy does that goes also into our chiller and the rest of our technology. And then, of course, being able to create those micro geometries has some clear interest within the cold plate, and so we are looking at that opportunity as well. Their own pipeline of opportunity, it's a very small revenue company, but they have an enormous pipeline that we intend to capitalize on. Fantastic. And, yeah, you mentioned, you know, the ability to drive a differentiated CDU offering. So, you know, maybe if we think about the commercial HVAC business there, overall at JCI, very, very high order growth, second half of the calendar year, particularly fourth quarter, that you saw. Any kind of one-time factors driving that? How do you see the sustainability of high orders growth into this year, and what are the main sort of verticals, data center and beyond, driving that? Yeah. The momentum is really coming from multiple factor. Mm. The increased demand coming from hyperscaler and colos, that you see the CapEx commitment continues to increase. Yeah ... and then also the technology differentiation we've been able to achieve, particularly on chiller, has allowed us to take kind of a leadership position, and we think we gained more than our fair share last quarter and gain a higher share of wallet with most of the customer we have. The timing is very hard to predict. Mm. We could have seen that a quarter earlier. We could see a quarter later. In terms of momentum, we entered the quarter with a pipeline of opportunities that was growing double digits. On any normal quarter, if you see a double-digit print in orders, your pipeline gets so depleted that it's very hard to maintain a momentum in the order grows beyond because your pipeline gets depressed. What's incredible about last quarter is we entered with strong double-digit pipeline growth. We printed 40%, and our exit pipeline still grew double digit on the back end, which honestly, in my 21-year at JCI, we've never seen. But that is really a testament to that continuous demand and kind of the customer intimacy and the effort the teams have done to really build the understanding and the roadmap for customer to understand where they're investing, what product needs they have, and how can we make an impact in their whole build-up of that incredible data center construction that's happening here. Great. And when you think about, you know, the backlog is there, when we think about conversion of that into revenue, you know, I suppose- Yeah ... help us understand kind of timing of that, first off, and, and just the mechanics on the, the lead and the lag and so forth into sales, and then also the capacity of JCI to manage that conversion efficiently. I, I think some other companies with, you know, high data center growth, it's been uneven, let's say- Yeah ... their incrementals on that revenue. So, multiple parts of your question, right? Yeah. There's capacity, there is our ability to keep up with revenue growth, and then there's really the timing on when our customer are able or willing to take that revenue, based on the orders. Mm-hmm ... they've pushed. First, on capacity, about two years ago, we almost tripled the hard capacity, roof line, manufacturing lines within our North American footprint to keep up with the demand we were seeing and the size of the pipeline. Through the transformation of our enterprise and the adoption of a business system, we are now working on increasing, to a certain extent, the same level of capacity through soft capacity. What I mean by that is, when you have a production line that can maybe output a chiller or two a week, can we dial that up to three or four chiller a week? And what does it take from a supply chain, from an automation, from a process management, to just increase that output- Mm-hmm ... with the existing, hard capacity we have? The way the demand has been shaping up is accelerating, transparently faster than what our capacity, planning was originally. We are working on trying to keep up with that demand, but if it continues to accelerate, there will be a point where it outpaces our ability to create that capacity. And from a revenue translation, a lot of those orders you saw in the first quarter, some of them are going to start revenuing in the fourth quarter, in August or September for us, but the vast majority are 2027 deliveries. Then the last part is the customer has to also be able to receive material. For the most part, because those are orders they've entered directly or backlog, that means most of those customers are willing to take delivery of the vast majority of those orders within 12 months. Yeah. Are they able? Is a question. The biggest gating item that we are seeing in the short term, we don't know if that's going to continue, but in the short term, is the electrical infrastructure generally comes up four-six months ahead of us on a build-out of a data center. And it looks like the delivery, either because of installation challenges or delivery challenges from the electrical infrastructure, is being pushed out three-four months at times. And so while we've worked really hard on improving our on-time delivery, it looks like there are some challenges within that infrastructure that is pushing some of that ability to receive order early. Some of our customers are willing to actually take orders to stock, so they are happy to warehouse some of that equipment, but not all of them. We need to map out with- Mm ... greater clarity in 2027, what that's gonna mean. But from a pure HVAC equipment order, it means, right, double-digit growth for that particular part of the business. You know, on that point, when you're looking at the overall, say, Americas business, and, you know, assuming that a lot of that data center activity is domestic, in the U.S. in terms of order intake- It is. You know, is it sort of fair to assume that that segment should see, you know, for some period, we'll see, but should see kind of double-digit organic sales growth a few quarters out when this backlog starts to- Yeah hit the P&L? So the dynamic of that segment is it's not all HVAC data center- Sure -yet. But over time, it will. It, it will. Yeah. That, that business is about 50% HVAC and 50% fire security and, and- Mm-hmm some other businesses that are not directly- Yeah seeing the support- Mm-hmm -growth of the data center. These businesses are performing okay. Yeah. We think we can operate better there, and we can help them accelerate growth. It will take time, but these businesses grow low single digit, and so it's a question of relative performance. But you're right, the HVAC will probably drive at least a high single-digit net-net growth and potentially moving that segment to the double digit, depending on the timing of that revenue and that ramp I was talking about, and the ability of those customers to take revenue. Everything perfect? Absolutely. This growth is- Yeah in the double digit, but I don't live in a perfect world. I live in the real world. I think, you know, one of your industry peers mentioned that, you know, they have a... not as large as yours, but they have a presence in building management systems. Mm-hmm And that's helping them win share in applied HVAC in data centers as well. Sure. So maybe, you know, you obviously have a very strong position in both commercial HVAC- Yeah plus BMS. You've always been good there. Help us understand kind of that linkage, you know, and is there more of that systems purchasing- Yeah effort now by the larger data center customers? So the market is evolving from a pure play-by-play component, kind of buying behavior to a more ecosystem approach. Some players within the market have taken a system integration kind of approach, encompassing not just thermal, but sometimes electrical as well. But we're seeing the buying behavior of a lot of our customers shifting towards a more integrated system. So they want to understand not just the chiller performance, but how does that correlate to the CDU performance? How does that correlate to the air handler? And how those three assets- Mm-hmm Are being controlled and managed by the, by the BMS, the BMS infrastructure, and is there a way to eke out more performance or reducing the overall energy usage? It's an evolving market. Yeah. I will tell you, it's probably a smaller fraction of our orders that are really all-encompassing- Mm-hmm ... the absolutely end-to-end value chain. But over time, you can see more and more as we start engineering the next generation of data center, it's starting to become the standard. They will wanna understand, how does the chiller and the CDU are going to interact? How does that capacity play out? How can you optimize the performance of the two by having optimized BAS? At some point, certain data center player had moved towards more PLC solution because they wanted that immediate reaction. Think of a PLC able to react in tenths of seconds or microseconds. A BMS reacts in a few seconds. Mm-hmm. So there was a sense that you needed that extremely quick speed to reaction because the demand management was so complex to plan for. Now that they've solved a lot of that co-demand management, they're really thinking more of, as a traditional BMS, how do you get all of those assets to actually talk to each other and interact more rapidly and more efficiently with each other? It's a journey, but, Mm-hmm ... we are extremely well-positioned, especially with our Metasys solution that has a dedicated, kind of platform- Yeah - to support the data center vertical. You know, there's been a lot of debate the last two months around data center cooling architectures- Yeah - and how that it will evolve. You know, I guess, help us understand kind of when you think about liquid cooling and the whole sort of CDU and cold plates and so forth, that growth rate the next few years in data center cooling versus, say, more traditional chillers and air handlers, you know, how wide is that growth gap? And, you know, how confident are you that JCI will have also very high share- Yep - in the liquid cooling side? So, it's a complex equation. Yeah but let me try and simplify it overall. The entire tide is rising very rapidly, right? So the total gigawatts- Mm-hmm - or the size of those data center continues to increase. Over time, not this year, not next year, probably not the year after, but over time, in probably the next three-seven years, the performance that you can get out of the chiller to manage the entire value chain, cold chain, I'm sorry, of the data center, that performance will continue to improve. Meaning, over time, reduce the amount of dollar per megawatt that the chiller plays in the overall stack. The total addressable market for a company like ours is actually gonna not decrease because of that, but increase because the CDU, the air handler, the control- Yeah - to generate that energy efficiency will continue to rise. Ultimately, the goal of the data center is really achieve that PUE- Mm-hmm ...that energy performance level to reduce the amount of power that the data center is using to run those chiller and get to thermal load and bring that energy back to compute, which is what is generating revenue for them. So over time, yeah, the chiller, there are likely gonna be chiller needs for a very, very long time. But that chiller need, with efficiency, will come down per megawatt, but the number of megawatt is moving so much quicker- Mm-hmm ... the growth is there. It's just a mix within that growth that's gonna evolve over time. That's why we made investment into developing our own CDU. Yeah. That's why we made the Alloy investment- Mm-hmm ... to continue to be able to improve our total addressable market per megawatt of data center, that's being built out. In terms of kind of market share, you know, the liquid cooling world- Mm-hmm ... you can get different types of players there, you know, Asian tech hardware companies, that type of thing. So a very different type of competitor to what JCI or YORK has been used to dealing with. Yeah. You know, help us understand kind of how you'll compete against them and, and the confidence in the market share in that liquid cooling portion? So not everything is about competing. There are ways to partner. If you look, for example, at the Cold Plate market, the top three -five players are mostly Asian component manufacturer- Yeah ... with incredible output. There's one U.S. player that is now owned by an electrical player. But the scale player in that market are, for the vast majority, very large output component manufacturer in Asia that operate at fairly limited margin because it's just about a volume game. Mm-hmm. If you look at it from the outside, it's a difficult market to find attractive because of the lack of differentiated between those different cold plate and just the mechanics of what a component manufacturer model brings. Where the market is evolving is towards more differentiated solution at the cold plate, at the CDU, at the chiller, and throughout the ecosystem. That differentiation will take time because the level of engineering complexity as the thermal load of each CPU and GPU continues to increase, becomes rather complex. That's where an Alloy transaction- Mm-hmm ...comes into play in that technology. But that evolution is very important. So we do not perceive a need to be a player in every single parts of that market, and finding the right partner to play and support an end-to-end solution for our customer is where we think that approach. But you have seen when the demand is so high and the supply is constrained, you naturally see a natural player coming into the market and that's our fault as an industry to have not kept up sufficiently those players at bay. But naturally, they bring differentiation and different approach and different concept, but we think that-... 140 years of experience in thermal management and the 3,000 engineers that back up that history will far outpace innovation and capabilities that some newer entrants may bring. But we're very cognizant of the dynamic of the market is playing. You can see that we're keeping a very tight pulse on where the technologies are moving, and Alloy is a great example of that, of- Mm-hmm. I can pretty much guarantee that 90% of the people in the room have never heard about- Yeah You know that technology and what they have to propose and offer. And it's a testament to how our engineer and R&D team and our corporate development team, like, are really thinking three, five, 10 years ahead and where the puck is moving and not looking at where it is right now. Great. And then maybe switching to some of the sort of self-help around the productivity and- Yeah and the margins. Yeah -and so forth. You know, huge focus there. One thing that's in the very short term, you know, some questions since the very strong set of results for the last quarter around kind of the Americas margins, you know, not outsized expansion today, but is expected to step up later in the year. So kind of help us understand what the drivers are of that step-up, please? Yeah. So starting at the enterprise and then maybe- Mm-hmm Going down the Americas comment you made. So from an enterprise level, the self-help come from the large restructuring program we announced about 18 months ago. And you've seen the return on that benefit. There's, like, three different aspects to that program. It's addressing the base cost in some of our function. That's just brutal cost elimination and restructuring. Second is kind of the adoption of the business model and simplifying how the different team work with each other, and reducing the cost to serve, whether it's the IT function, the procurement function, the finance function. Mm-hmm. You simplify your operating model, you need less people to actually support that operating model. You actually end up saving money, making decisions faster and stronger. And then, thirdly, we have an incredible level of complexity from a product and manufacturing footprint standpoint. We have a little over 40 factories and distribution center around the world. On paper, it looks like a great network of factories, but ultimately, if you design the ideal endpoint, given the demand we have today and in the future- Mm ... it's probably a couple handful too many, Yeah -factories. Yeah. What that drives is, if you consolidate those factories, you find a way to reduce your fixed overhead, you increase your speed, you reduce the whole functional support around- Mm-hmm -supporting those 10 or so factories that you're gonna consolidate, and you make the supply chain that much easier to manage for the enterprise. So we continuously see an opportunity to improve that self-help. has driven a lot of value. Now, when it comes to the dynamic of what's happening in North America, it's twofold. The first one is North America is benefiting from that extremely fast growth of the equipment business because of data center. Life science and other. Mm-hmm complex manufacturing have also helped them quite substantially over the last couple of quarter. And our equipment sales margin, while really healthy, call it 35%-36%, they're about 10% lower than our service margin. And when you have a business at 35% margin, that grows twice as fast as a business- Mm that has 45% margin, you have a mixed headwind. Yeah. So we have driven a lot of cost optimization within that team. We still have more to do within that segment. Mm-hmm. But in the short term, a lot of that improvement has been eaten up by that- Right ... by that mix. In parallel, parts of the portfolio is struggling a little bit, and our security business is performing, but is not performing to expectation. It's not improving as fast as the rest of the portfolio. So there are things we need to do to really turn around that team and help them focus on better operation. And finally, when you build a franchise the size of our service franchise, one of the biggest challenge you have is you have an enormous base of contracts, and that base of contract has a natural attrition to it. Mm-hmm. Customer decide from time to time to, you know, shut down- Yeah or find another provider to help them or decide to bid the project, and somebody else ends up winning it. The more contracts you have, the bigger your attrition, the more challenging it is to grow in double digit- Mm-hmm ... your revenue base. There are solutions for that, and we're working on those, but in North America, that size of the service growth means that there's a bit of a ceiling in the short term for that business to grow much more than a high single digit on service. We're working on breaking that ceiling. Mm. It means service productization. We can talk maybe about it a little later, but that means our ability to accelerate the growth of service, to keep up the margin rate of service at the same pace as the rest, is a little challenging in the short term. I'm not saying there's margin rate headwind. Mm ... but it's all of the work we're doing from a self-help is not- Yeah ...fully translating in Americas into a full bottom line translation yet, but it will come. Got it. That's very comprehensive. And maybe Mark, sort of, you know, corporate line, not the most interesting subject, but- No. You know, JCI is a fairly big lever coming down sort of relentlessly since the R&LC divestment, you know, how much more room is there for that corporate line to keep shrinking? There is more room. I mean, we've come from $450 million to, call it, $350 or so. Yeah. It's not gonna go down to zero, otherwise I won't have a chance to spend time with you guys because I'm in that line, unfortunately. But at some point, there is obviously a limit of the infrastructure, but we think there's still a whole lot more work to do. We've talked a little bit about it. Over time, what we have done is we've moved costs from the segment into the corporate structure to kind of eliminate and simplify a lot of that work, and then we move back a much lower base back into the segment from a service standpoint, and we're gonna continue to do that play. So it means the corporate cost moves up and down, like, it's moving towards a downward trend. Yes ... but it's not a linear curve downward. Okay. There's plateauing and then acceleration, plateauing and acceleration. Mm-hmm. and that's where it comes from. It's, and it's part of really that business system transformation. Yeah ... where you really create better clarity on your ways of working, who's responsible for what, what it means to be a function that supports the P&L, that supports the business, that supports the people, that help our customer every day. It's a change in approach, mentality, but it drives real value from a corporate cost standpoint. Fantastic. And then lastly, I guess let's touch on the portfolio for a second. Mm-hmm. You know, in terms of... You know, you mentioned parts of security are struggling. Like, when do you take a decision to say, "Okay, it's, you know, better in parts of it," or parts of any, segment at JCI that's not performing well, you know, when is it time to maybe find a, a different owner for that and, and, the scale of it? And, and, you know, separately on the acquisition front, you mentioned the acquisition, announced in the last 24 hours, but, you know, what's the appetite to do something larger, say, in liquid cooling to really cement your position there? So, first on the overall portfolio, our job is to operate those assets the best we can, and so selling an asset because we're not managing it well is not a good enough reason to separate from it. Our decision on portfolio really come from our strategy. It's a focus on AI data center, mission-critical vertical, where we can actually create differentiation. Mm-hmm ... and then energy efficiency or decarbonization. We think about those three pillars. Yeah. There's assets that we own that fit squarely there- Mm-hmm ... like the HVAC applied, the controls business very clearly. There's assets that are a little bit more challenged, either because they don't serve the right vertical. Yeah. We've seen a couple of announcements. We've divested two of our residential security business over the last two quarter- Mm-hmm ... and we're gonna continue to divest more. We have businesses that serve end markets where there's no real mission-critical approach, there's no real AI view, there is no decarbonization play. I'm thinking some of our retail end market, some of our more residential end market. We are on a path to continuously improve those businesses and how they perform, but also looking at, is there a better owner? Then even if there is a better owner, can we get sufficient value so we can create a shareholder-friendly transaction? Some of those transaction, because the tax basis is so low, will remain dilutive- Yeah ... because we'll pay a lot of tax, but there is a value to simplifying or finding a better- Mm-hmm ... owner for that asset than spending all of our time and energy fixing a business that really doesn't fit the overall strategy. Yeah. Now, when it comes to a greater acquisition, a big change, we do not believe it is required at this stage for us to be winning. Okay. I'm not saying it's not in the cards. I'm saying it's not required for JCI to maintain the leadership position we've established in data center within our markets. We're opening up a little bit our aperture on what that market really means. And we'll keep you updated as we assess potential targets and what ultimately that strategy around data center really leads from, what belongs to the portfolio and doesn't. Fantastic. Well, with that, let's switch quickly to audience response questions, please. So the first question is around current ownership of JCI. If you're not owning, you're missing out. Right. So I don't know, 50% no. 50/50. Slightly below the average. I think most of them are in the, in the sixties, no. Second question is sort of general attitude to the stock today. So overwhelmingly- Well ... positive. Third is around EPS growth through cycle, kind of versus the multi-industry average. To choose three, I've really done a terrible job today. I'll take the feedback, but... There you go. Uh. 0%. So yeah, it's very clearly above peers. Fourth is around cash usage. We just touched on that at the end of the discussion. So generally, sort of smallish acquisitions. Next question is valuation related. You know, what's the PE JCI should trade at on year one? Can I vote? Definitely. Next time. So in the 20s, comfortably. And last question: What's the biggest kind of gating factor or, valuation, anchor? All right. Well- So mishmash, but, yeah. Well, that's it. Amazing. Thank you. Thanks so much, everyone, for contributing. Thanks so much, Marc, for being here again. Cheers. Lovely to see you. Thank you.