Good day and thank you for standing by. Welcome to the Kyndryl second quarter 2026 earnings conference call. At this time, all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Lori Chaitman. Good morning everyone and welcome to Kyndryl's earnings call for the second fiscal quarter ended September 30, 2025. Before we begin, I'd like to remind you that our remarks today include forward looking statements. These statements are subject to risk factors that may cause our actual results to differ materially from those expressed or implied. These forward looking statements speak only to our expectations as of today. For more details on some of these risks, please see the Risk Factors section of our annual report on Form 10-K for the year ended March 31, 2025. Also in today's remarks, we refer to certain non-GAAP financial metrics. Corresponding GAAP metrics and a reconciliation of non-GAAP metrics to GAAP metrics for historical periods are provided in the presentation materials for today's event, which are available on our website at investors.kyndryl.com. With me for today's call are Kyndryl's Chairman and Chief Executive Officer Martin Schroeter, and Kyndryl's Chief Financial Officer David Wyshner. Following our prepared remarks, we will hold a Q&A session. I'd now like to turn the call over to Martin. Martin. Thank you, Lori. Thanks to each of you for joining us. In the second quarter and first half of the year, we delivered margin expansion, a substantial increase in earnings, and strong growth in both Kyndryl Consult and hyperscaler-related revenue streams. Our trailing 12 months revenue book to bill remains above one, illustrating the quality of our recent signings supporting our future revenue growth. We are reaffirming our outlook for fiscal year 2026 and we are pleased that our internal cash generation and balance sheet strength position us to increase our share repurchase program by $400 million, reflecting our confidence in achieving our fiscal 2028 objectives. Focusing on revenue, even though we successfully signed most of the deals that had slipped out of Q1, our revenue for the quarter again came in about $100 million below what we were targeting. We expected a strong September to drive a sequential uptick in our year over year revenue comp that did not fully materialize. The underlying dynamics are that our growth drivers like Kyndryl Consult and hyperscaler-related revenue are working well and resonate with customers. We are increasingly working to expand scope in our contract renewals, which has led to longer sales cycles. Since these large complex deals often involve replacing incumbents or transitioning insourced work to Kyndryl, we still expect these expanded scope deals to close before our fiscal year end. Third, our focus on margin expansion is a revenue headwind for us because we have taken low margin hardware and software content out of our customer relationships. We estimate that this was roughly a 4% drag on revenue growth in Q2, without which our constant currency revenue growth would have been positive. You can see the benefit of this strategy in our earnings. We entered the third quarter with a record pipeline that supports second half signings growth and a full year book to bill ratio above 1. As a result, we're confident we'll deliver revenue growth in the back half of this year as we're redoubling our efforts to expand our services footprint throughout our customer base. David will walk you through more details on these points, but I want you to keep in mind the following. We're entering the second half of the year with a larger revenue contribution from our committed backlog, including less of a headwind from having removed hardware and software content. We have incremental growth opportunities from Kyndryl Consult and the hyperscalers, and customer demand is driven by IT modernization, AI, and cybersecurity. We're also operating with a clear long term mindset, all fully aligned with our triple double single fiscal year 2028 objectives and we remain on track to achieve them. In fact, they represent the culmination of the strategy we've been executing powerfully over the last four years. With our Accounts Initiative, we focused on removing unprofitable content and fixing unprofitable relationships. During this process we kept adding more gross profit to our backlog even as we were shrinking our revenues. We also began investing in Kyndryl Consult capabilities and our alliances, driving scope expansion with existing customers and our ability to add new logos. We've seen the growth in Kyndryl Consult and in hyperscaler-related revenue streams as a result of these investments and that momentum is continuing. We then turned our attention to signings growth, which drove our last 12 months revenue book to bill ratio above one, a level we've maintained for five consecutive quarters now, and this has brought us to a spot where over the last 12 months we're generating constant currency revenue growth aside from the estimated effects of removing hardware and software content. The next step is for the content removal headwind to dissipate and the consultant hyperscaler growth to continue so that we're routinely delivering total constant currency revenue growth. It is in this context that we believe the strategy we deployed is working despite the near term revenue pressures we faced in the first half, and we're well positioned to deliver growth in the second half on our way to our triple double single fiscal year 2028 objectives. On today's call, I'll provide a deeper dive into the multiple growth drivers available to us, including infrastructure modernization. I'll also discuss how agentic AI will both be an operational and a go to market tailwind for Kyndryl. Before diving into the near term opportunities, let me first highlight areas where we're already seeing profitable revenue growth. Among signings, our fastest growing practices have been apps, data and AI and digital workplace. Our strongest geographies have been Canada, Spain, India and Latin America and the projected pre tax margin on our total signings continues to be in the high single digits. Kyndryl Consult revenue has increased 32% in constant currency over the last 12 months and is now running at an annual pace of $3.4 billion and our hyperscaler related revenues have doubled since last year and we're tracking above our initial $1.8 billion fiscal 2026 target. Our excellence in service delivery is foundational to our growth strategy. Our innovative and outcome-based approach to managing, modernizing, and optimizing complex technology estates drives significant value for our customers and fuels share of wallet growth opportunities. Simply put, customers entrust us with more work because they appreciate the quality of what we already do for them. We deliver our mission-critical services through Kyndryl Bridge, our AI-powered operating platform. With Kyndryl Bridge, our delivery teams and our customers run on a single open platform for monitoring, managing, and securing their IT estate end to end with an unprecedented level of real-time observability. Kyndryl Bridge now performs more than 186 million automations and generates 15 million actionable insights each month, making Kyndryl an ever more indispensable enabler of mission-critical services. We have more than 100 partners integrated on the platform including Cisco, NVIDIA, Oracle, SAP, and ServiceNow, providing real time observability that spans applications, databases, networks, mainframes, and clouds across multiple technology vendors. As a result, Kyndryl Bridge combined with our knowledge of our customers' infrastructure dramatically reduces risk. It enhances security, it sets guardrails, and accelerates problem solving. It has solidified our reputation as the gold standard for infrastructure services. It is a key driver of our top tier customer satisfaction and of how we are able to regularly win new scope during contract renewals. It is also a key driver of the $875 million of annual savings that our Advanced Delivery Initiative is generating. Our capabilities position Kyndryl at the hardest secular trends like AI, cybersecurity risks, cloud migration, modernizing complex hybrid IT environments, and industry wide skill gaps. Our alignment with these trends is allowing us to drive future growth in multiple ways through expanded partnerships with our alliance partners, through scope expansions and new customer wins, through mission critical infrastructure expertise, through incremental Kyndryl Consult engagements that leverage our technology-first mindset by uncovering new opportunities with insights from Kyndryl Bridge and our recently launched Agentic AI Framework, and by capitalizing on the widespread enterprise need for infrastructure modernization that spans all six of our global practices. I want to double click on one of our growth factors: infrastructure modernization. Our expertise in modernizing mission critical systems and our deep-rooted customer relationships are key drivers behind the double-digit growth we're achieving in Kyndryl Consult and the additional managed services scope we regularly take on. As AI adoption accelerates, large enterprises are under increasing pressure to address tech debt and modernize their mission critical systems. We hear this from our customers every day and modernization now extends far beyond just updating front end applications. Organizations need to transform IT environments to meet the rigorous demand of AI-driven operations, addressing evolving cyber threats, maintaining regulatory compliance, and leveraging new technologies. Our experience and innovative solutions uniquely position us to help customers manage tech debt and deploy AI at scale. We know that nearly half of IT systems are at or near end of life and all this tech debt represents a substantial opportunity for us, especially since most organizations use third-party providers for modernization. In fact, our annual Mainframe Modernization Survey showed that enterprises that have modernized their mainframe applications or migrated selected workloads to other platforms are realizing a two- to three-fold return on their investment. This underscores the tangible value of IT modernization in driving operational efficiency and business growth. Kyndryl is a trusted services partner that not only runs, but also transforms and sustains our customers' most vital IT assets. Relatedly, we're both using AI in our own operations and enabling customers to deploy AI in their businesses. For starters, our service delivery through Kyndryl Bridge features advanced AI leveraging machine learning. Kyndryl Bridge proactively identifies risks before they impact operations. AI-driven recommendations empower our teams to resolve issues in real time while our intelligent AI agents streamline knowledge discovery and accelerate incident response, building greater efficiency and resilience across the IT environments we manage. Our customers also need help with their own efforts to build and deploy AI agents using open source tools. By combining our infrastructure-first mindset with our deep systems expertise, we've created a dynamic Agentic AI Framework for our customers. Our framework incorporates a distinctive design process, specialized tools and an innovative engagement methodology that blends agents within complex IT environments to drive business process innovation and productivity. The Kyndryl Ingestion Agent uses company documents, procedures and data and goals to develop a comprehensive organizational process map. With this as context, the framework's Agent Builder capabilities allow the organization to design, test and launch AI agents to streamline workflows in accordance with relevant security and compliance standards. In other words, we help enterprises turn AI ambition into scalable transformation and the demand runway is clear as roughly 25% of our signings already contain AI related content. We are working with insurance companies, banks, manufacturers, healthcare providers and government agencies to deploy AI agents to streamline processes, deliver real time analysis and expedite decision making. Our AgentIQ Framework will help accelerate our customers' AI adoption and drive incremental opportunities for us going forward. To look at one example of how we're driving growth with a long-standing customer in the APAC region, we identified an opportunity to leverage our strong relationship to expand the scope of our work to the customer's operations in the Americas. Building on the trust we've earned through consistent delivery excellence over many years, we successfully displaced an incumbent service provider in the U.S. and won the assignment to manage the customer's mission-critical IT estate globally. Under our new contract, we'll be modernizing our customer's environment to enable global synergies and AI enablement while enhancing security and reliability. This modernization will migrate virtualized workloads to the AWS cloud and the entire tech stack will be supported by automation and observability from our Kyndryl Bridge platform. Importantly, this expansion will drive an increase in our revenues from this account of more than 25%. Expanding and winning new scope in our accounts is a key factor behind our positive financial trajectory in fiscal 2026 and beyond. As a reminder, by fiscal 2028, which for us begins less than 17 months from now, we expect to deliver more than $1 billion in adjusted free cash flow. We expect to deliver more than $1.2 billion in adjusted pre-tax income, and achieving these earnings and cash flow targets only requires us to reach the mid-single-digit revenue growth that we will progress toward by 2028 with strong conversion of our earnings to free cash flow. We are optimizing our capital allocation by investing in organic growth opportunities, deploying more capital to shareholders through our increased share repurchase program, and occasionally pursuing tuck-in acquisitions. In fact, we just announced that we've agreed to acquire a midsize cloud services provider in Europe. Importantly, our fiscal 2026 outlook is consistent with our expected growth trajectory from fiscal 2025 to fiscal 2028. As David will discuss, we'll continue to expect to generate approximately $550 million in free cash flow this year, to grow our adjusted pre-tax earnings by more than 50%, and to deliver 1% full year constant currency revenue growth. Keep in mind, two-thirds of our P&L this year will come from our higher margin post-spin signings. The first time that a significant majority of our revenue is coming from contracts that we signed as independent Kyndryl. As we've discussed before, the investments we've made in our expanded capabilities and partnerships with are opening new doors for us in terms of increased share of wallet and our ability to win new logos. We've won 450 new logos over the last four years and there's more opportunity in the market today and we have a robust pipeline of deals in the works as a result. I'm enthusiastic about our ability to pivot to a second half that we expect will be demonstrably stronger than our first. With that I'd like to pass the call over to David. Thanks Martin and hello everyone. Today I'd like to discuss our second quarter results, the solid margins at which we're signing customer contracts, and our outlook for fiscal year 2026. In the quarter, revenue totaled $3.7 billion, down 1% from the prior year quarter on a reported basis and 3.7% in constant currency. We continue to gain momentum in higher margin advisory services. Kyndryl Consult revenues grew 25% year- over- year in constant currency, which underscores how we're expanding our share in this higher value add space. Our Q2 signings, as expected, dipped year over year primarily because of the exceptionally strong Q2 we had last year. That said, our last 12 months signings total of $15.6 billion was 104% of our last 12 months revenue, giving us a book to bill ratio above 1. As Martin mentioned, we continue to see particularly strong signings growth in our applications, data and AI, and digital workplace practices, reflecting strong demand for services in these domains. Earnings in the quarter were solid as more and more of our revenue is coming from higher margin post-spin signings. Our Adjusted EBITDA increased 15% year- over- year to $641 million and our Adjusted EBITDA margin was 17.2%, up 250 basis points year- over- year. Adjusted Pre-Tax Income grew 171% to $123 million and our Adjusted Pre-Tax margin increased 210 basis points year- over -ear. Our three A's initiatives continue to be an important source of margin expansion and value creation for us and remain integral parts of our operational and go-to-market approach. Through our alliances, we generated $440 million in hyperscaler-related revenue in the second quarter. This puts us on track to exceed the 50% growth in hyperscaler-related revenue that we targeted at the beginning of the year. Other alliances from Cisco, Dell, and HPE to Databricks, Rubrik, and Palo Alto Networks are also fueling our ability to offer cutting-edge hybrid solutions to our customers. Through our Advanced Delivery Initiative powered by Kyndryl Bridge, we continue to drive automation throughout our delivery operations, incorporate more technology into our offerings, reduce our costs, and increase our already strong service levels. It's a win-win for Kyndryl and our customers. We've been able to preempt thousands of delivery professionals, and this is worth roughly a cumulative $875 million a year to us, representing a $50 million increase in our annual run rate this past quarter. Our Accounts Initiative continues to remediate elements of contracts we inherited with substandard margins. In the second quarter, we increased the cumulative annualized profit from our focus accounts by $25 million and to $950 million. I can't emphasize enough what an important source of sustainable value creation this has been for us. In short, our strategic progress is driving our earnings growth. Turning to our cash flow and balance sheet, we generated free cash flow of $22 million in the second quarter. Our net capital expenditures were $125 million. Working capital was the use of cash in the quarter, driven by the timing of receivables and vendor payments that we expect to reverse in the back half of the year. We've provided a bridge from our adjusted pre-tax income to our free cash flow as well as a bridge from our Adjusted EBITDA to our free cash flow. In the appendix, under the Share Repurchase authorization we announced last November, we bought back 2.9 million shares of our common stock in the quarter, 1.2% of our outstanding shares at a cost of $89 million, and yesterday we announced a $400 million increase in our share repurchase program. The expansion of our buyback capacity reflects the confidence we have in our earnings trajectory and cash flow growth, as well as our commitment to distributing cash to shareholders. Our financial position remains strong. Our cash balance at September 30th was $1.3 billion. Our debt maturities are well laddered from late 2026 to 2041, and we had no borrowings outstanding under our revolving credit facility. Our target has been to keep net leverage below 1x Adjusted EBITDA and we ended the quarter well within our target range at 0.7x. We were rated investment grade by Moody's, Fitch and S&P on capital allocation. Our top priorities are to maintain strong liquidity, remain investment grade, reinvest in our business, including through tuck-in acquisitions, and regularly buy back stock. I remain enthusiastic about how Kyndryl is poised for future profitable growth by maintaining an LTM book to bill ratio above one and commanding attractive margins on our signings. The September quarter was a continuation of U.S. winning business with healthy margins. Throughout fiscal 2023, 2024 and 2025 and now into the first half of fiscal 2026, we've signed contracts with projected gross margins in the mid-20s and projected pretax margins in the high single digits. Therefore, as our business mix increasingly shifts toward more post-spin contracts, you'll continue to see a significant margin expansion. In our reported results, we've again included a gross profit book to bill chart that illustrates how we've been creating and capturing value in our business. With an average projected gross margin of 26% on our $15.6 billion of signings over the last 12 months, we've added nearly $4 billion of projected gross profit to our backlog. Over the same period of time, we've reported gross profit at $3.2 billion. This means we've been adding more gross profit to our backlog than our contracted book of business has been producing in our P&L. Having a gross profit book to bill ratio above 1 at 1.2 over the last 12 months demonstrates how we're growing. What matters most is the expected future profit from committed contracts. It also highlights the quality of our post-spin signings. With our gross profit book to bill ratio having been consistently above 1, that means that we've been consistently growing our gross profit backlog over the last three years. As we've said previously, our core financial goals are to grow our revenues, expand our margins, increase our earnings, and generate free cash flow. Our outlook for adjusted pre-tax income this year continues to be at least $725 million. This means growing our adjusted pre-tax income by at least 50% and increasing our adjusted pre-tax margin by roughly 150 basis points year- over- year. As a reminder, it also means we're calling for a third straight year of substantial margin expansion, and it keeps us right on track to generate high single digit adjusted pre-tax margins in fiscal 2027 and fiscal 2028. We continue to estimate that our Adjusted EBITDA margin in fiscal 2026 will be approximately 18%, an increase of roughly 130 basis points versus fiscal 2025. We also continue to see opportunities to drive efficiencies in our operations both through advanced delivery and in SG&A functions. In fact, our enterprise services headcount is down 8% from where it was a year ago. On the topic of cash flow for the year as a whole, we're forecasting roughly 100% conversion of adjusted pre tax income less cash taxes into free cash flow, with cash taxes of roughly $175 million. This implies free cash flow of approximately $550 million. Our outlook for constant currency revenue growth in fiscal 2026 continues to be positive 1%, which implies revenue growth of 4%-5% in the second half. We're redoubling our efforts to drive this growth by aggressively seizing the multiple avenues for growth that Martin described earlier. Our plan for stronger second half growth is straightforward. Revenues from our opening backlog of already signed contracts for the second half are one point stronger than our opening backlog was for the first half. We've anniversaried our divestiture of a small business last year, which helps our second half growth compared to the first half by the better part of a point. We've invested in incremental Kyndryl Consult resources so that consult revenue, which is now a larger portion of our revenue base, continues to grow well into the double digits, contributing an incremental 2 points of growth. We're growing hyperscaler-related revenue more than we initially planned as we increasingly market solutions to customers hand in hand with our alliance partners, producing a 2 point benefit in the second half compared to the first. The larger pipeline of deals we have for the second half is adding incremental revenue both because it's larger and because of our emphasis on building additional scope into our customer relationships. This will also contribute approximately 2 points of incremental growth. A key theme that runs throughout these growth vectors is that enterprises' needs for IT modernization, their desire to invest in AI, and their concerns around cybersecurity are all driving incremental demand for our mission-critical expertise and services. Looking at the third quarter in particular, we expect to deliver positive constant currency revenue growth and for our adjusted pre-tax income to be 15%-25% higher than the $160 million we reported in last year's third quarter. In addition, we remain committed to delivering significant margin expansion and generating free cash flow growth over the medium term. We have a solid game plan to drive our strategic progress and this game plan starts with the steps we've already taken to expand our technology alliances, realize the numerous growth opportunities available to us, manage our costs and earn a return on all of our revenues. Sometimes investors want to confirm the favorable math that's associated with our forecast to more than double our adjusted pre-tax income from fiscal 2025 to fiscal 2028 combined with our share repurchase program and the answer is yes. With our income tax expense projected to be in the 25% range, our forecast implies that we'll generate adjusted earnings in the fiscal year after next of roughly $4 per share. To wrap up. We're well positioned for success as a leading provider of mission critical enterprise technology services, driving thought leadership in our space, delivering modern hybrid IT solutions, growing our Kyndryl Consult presence, rapidly achieving top tier service levels and customer satisfaction scores, and operating at the heart of secular trends that will fuel customer demand for our services for the foreseeable future. Let me end by again thanking the tens of thousands of Kyndryls around the world who are powering our progress. With that, Martin and I would be pleased to take your questions. At this time we will conduct the question -and- answer session. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q& A roster. Martin, are you ready for questions? Yes, thank you, operator. Our first question comes from Jamie Friedman at Susquehanna. Hi, good morning. Congratulations on a strong quarter. I wanted to ask something about the capital allocation opportunities for the company. Did $725 million of adjusted pre-tax income as your target for the year and the free cash flow of $550 million? It gives you a lot of optionality on the capital allocation, which is attractive to the investment thesis. Just trying to figure out from your perspective what the priorities are from the capital allocation side. Sure, thanks. Thanks Jamie. And thank you for joining this morning and for the nice comment. I'd say a few things. Obviously we're investing in our business in the form of CapEx and we'll continue to do that. And we're also investing in new capabilities and accelerating our capabilities. And you saw that this morning in the form of our now pending acquisition of Solvinity in the Netherlands. And then outside of that, obviously, because we do see very strong cash flow growth, we see an opportunity to return capital to shareholders. We started last year with a $300 million share repurchase and then we followed that up this year with an increase approval from the board for a $400 million share repurchase. So I think going forward we have those same opportunities. We'll continue to invest in the business, we'll continue to accelerate our lead in certain areas where we see opportunities in the form of tuck-in acquisitions, and we'll continue to return capital to shareholders. I just for my follow up, want to ask about AI. I know you had some comments last night and in your prepared remarks about AI, I think that there's some reference to 25% of the workloads, maybe that's the wrong word, but the number might be right, are informed or delivered through AI. Martin, a high level perspective on how AI, how AI may inform the competitive position and mind share of Kyndryl going forward. Yeah, thanks Jamie. Just make sure we have the sort of the number clear in your head. We said in our prepared remarks this morning that about 25% of our signings have AI related content already. For us, you know, we do AI related work primarily in our cloud practice and our digital workplace practice and obviously in our apps, data and AI practice. Our AI related work is focused on data architecture and data migration services that allow our customers' AI models to operate. We have in digital workplace services obviously AI enabled solutions that our customers are consuming. We also do obviously cloud migration work to enable our customers to adopt AI. We have some agentic development, agentic AI development that our customers are starting to consume now and that gets them ready for AI, that helps modernize their infrastructure so that they can turn their AI pilots into scaled components of how they run their business. It is focused on those practices. The other thing I'd say is it's pretty broad based. We work with insurance companies and banks and manufacturers and healthcare providers and government agencies as well on deploying agents now because they're really trying to transform their business processes and obviously these are very complex IT estates and that's why Kyndryl Bridge is such an important part of this because it gives them the data they need and the visibility they need to how their business processes are working. That again extends our lead and our competitive advantage in these mission critical workflows. About 25% of our signings now have that form of AI related content. Thank you, Martin. I'll drop back in the queue. Thanks, operator. Next question, please. Our next question comes from James Faucette at Morgan Stanley. Hi, good morning guys. Thanks for doing this this morning on your CapEx and acquisitions. You've been pretty clear that you plan to do some tuck in acquisitions, but can you give a little more color on the kinds of things that you're looking for and maybe give us a sense of what those valuations look like and how should we think about allocation to CapEx and acquisitions versus buybacks? Do you have a targeted level or range that we should be thinking about? Sure. Thank you and thanks for joining. When I think about the two acquisitions we've done so far, I'd say that they have sort of common characteristics. First and foremost, they are very much in, they are very much part of, very much part of what we do today. Right. We are the world's largest infrastructure services provider. Our acquisition a couple of years ago was focused on moving power architecture onto Microsoft's cloud, very squarely in the middle of how we operate. It gave us the technology and the IP we needed to help accelerate our customers move to the cloud. Everything about that is what we do today, it was just a way to accelerate Solvinity. Today is, again, it's a managed private cloud sort of structure where all over the world, and we see this in our surveys all over the world, people are working, worried about sensitive workloads, about regulatory requirements, about cloud sovereignty. What this allows us to do is, again, what we already do, we advise, we implement. We manage clouds on behalf of our customers, both private and hybrid. This is now another step into the sovereign world for us in Europe. They all have this consistency around what we do today. Again, it's either accelerating what we're already doing or allowing us to move into a very specific part of the market. In this case, again, sovereign cloud in Europe. This is about, look, it's about the right size. For us it was EUR 100 million. You'll see that in the queue later today with EUR 100 million purchase price at a, and at a reasonable kind of a multiple. When it, you know, we would expect it would close probably late our fiscal year, first half, next calendar year, sometime. Again we're not looking to change who we are. We're trying to stay, we will stay focused on mission critical infrastructure services. With regard to other capital allocation, how to think about it, I think the two data points now that you have that we've given everybody for instance on share repurchase are starting to form a pattern. That doesn't mean that we can't do something differently if the market changes. We do view our stock as a pretty good, as a very good value here. Last year at $300 million it was sort of what I'll call a trailing the cash flow generation of the business. This year at $400 million, again it's trailing the cash flow of our business. As we grow we obviously have opportunities to continue to increase that, but we'll do it more on a trailing basis. We keep the flexibility that we need within the business, we keep the strong balance sheet we have, et cetera, et cetera. I'll ask David if he has anything he wanted to add to that. That's right, Martin. In terms of capital expenditures in particular, we expect those to be around 4%-5% of our revenues over time. The substantial majority of that is to support our customers' infrastructure and IT needs, call it three to four points out of the four to five. The remaining point is really related to our needs as a corporation with more than 70,000 employees around the world. That's how we get to the 4%-5% of revenue number. When we think about our free cash flow, it's actually calculated after our capital expenditures. Those CapEx are, if you will, funded before we get to the free cash flow that can be deployed elsewhere. As Martin was saying, I think about us being able to pursue both, both share repurchases and tuck-in acquisitions. It's not an either or for us. You could see that in our announcements yesterday and today where we announced both the share repurchase authorization increasing and the tuck-in acquisition of Solvinity. That's great. Then just quickly, can you give a quick comment or summary of how you're finding customer decision cycles right now? Do they seem about normal or is there any movement in those sales cycles? They seem fairly, they seem normal to me. I think what we're experiencing is not that they're changing, it's just that as we move to add new scope, as we add new customers, there's a tendency, given what we do and the mission critical nature of what we do, there's a tendency to be cautious and there's a tendency to make sure that everything is right because these have to go well. That's true whether it's a new customer and it's true if you're just adding new scope. We obviously have renewals that we're doing, but in the substantial majority of cases there's new content coming in. We had an example in our prepared remarks this morning that shows how we grow within our account. I do not see any difference in decision making from our customer standpoint. I do see that because of how we are growing and the new capabilities we are bringing in, there is just a consistent level of care because they have to go well. These mission critical relationships have to be perfect all the time. Thanks, operator. Next question, please. Our next question comes from Tien-Tsin Huang at JPMorgan. Tien-Tsin Your line is open. Hi, sorry, can you hear me now? Hello? Yes. Thank you. Sorry about that. Just thinking about the revenue. I appreciate the second half discussion and Martin, you said demonstrably stronger second half, but I'm just thinking about the $100 million in revenue below expectations and with the September month and the deal slippage, the revenue conversion then, doesn't that push out, put greater risk in the second half relative to what you thought in the beginning of the year, or is it being made up for with some of the incremental consult resources that you also discussed in the prepared remarks? Thanks. Yes, thanks. Thanks, Tien-Tsin. Look, there are, I think, some things we, obviously we know as we sit here today and we tried to lay this out, David, at the tail end of his remarks. We know that we enter the second half with a contracted backlog that is in a better position. We also know that we wrap on a divestiture we did last year. Their starting point in the second half is a couple of points stronger than what the first half was. We know that there is certainty around that. We also know that the demand profile in our consult business and our investments in our capacity will deliver an acceleration in the second half. You know, that's fairly, it's fairly evenly split in the third and fourth quarter and our momentum in the hyperscaler business, the hyperscaler-related business, you know, there's real momentum here. It's supported by what we see in our customers, cloud growth. We see that continuing as well. You know, the last piece is, and maybe this is part of what you're trying to really get to. Yes, we have a stronger pipeline than we had and yes, the content within that pipeline has a slightly nearer term realization element to it because of the way these deals are shaped and constructed and because of what's in them. They could move. As we've always said, we're better at predicting the year in which something signs than the quarter in which something signs. We do not need to sign all of them obviously to deliver. My experience is that the renewals, the scope expansion, all these deals, they can shift quarter to quarter, they're not likely to shift year to year. With what we know, again, second half starting point is an improvement from the first half. The investments and the demand and our ability to meet the demand we see in consult drives improvement. The hyperscaler-related businesses do have a lot of momentum and continue to have a lot of momentum. The deals we're working on just have stronger near-term content. I feel good about how we start s econd half. U nderstood. No, that's helpful, thank you. Our next question comes from Ian Zaffino at Oppenheimer. Hi, thank you very much. You know, just on the pipeline, very strong here, maybe tell us what verticals or geographies have been particularly strong. Also when we talk about expanded scope or content, can maybe give us an example or two about that. Also in this pipeline, what sort of confidence that this is going to close and be converted. Thanks. Sure. I'll start with the verticals and then we'll go to an example. On the verticals, I'd say retail and travel and TMT, technology, media and telecommunications, have been the strongest for us. Financial services has been okay in terms of levels of activity and perhaps not too surprisingly, given uncertainty out there in the market, I'd say industrials and the public sector have been probably a little bit on the lighter side among our verticals. In terms of the examples, I think there are a number of them. There is one we talked about, the financial services firm example that we walked through where we are actually doing multiple things. The first is that we are expanding what we do into a different geography for a multinational firm. The second is that we are taking on additional work and the most typical form that is going to take for us is a situation where we are running the historical or legacy elements of the infrastructure, ones that we often have been involved in for multiple years. Now with the freedom of action we have as an independent company, we are expanding into areas that are beyond that. Hyperscaler-related activity being tops on the list, additional cybersecurity content being common. We are doing often more networking-related activity for our customers as well. The pitch associated with this is really about us being an end to end solution provider, which is something that customers really value in their provider of mission critical IT services because it reduces the number of, I guess, potential air gaps and finger pointing that can exist. It drives efficiency, it drives faster problem solving, it drives accountability and it plays to our strengths in terms of our ability to convene all of these capabilities in one spot in a way that really provides great outcomes for our customers. What we are seeing is really strong customer satisfaction and even stronger service level achievement as we expand the range of services that we are providing to customers. We view the strategic thrust that we have of building additional scope into our customer relationships as a real win win. It's key to us growing our revenues, but it also helps us provide even better quality and scope and scale of services to our customers in a way that helps them meet their business objectives. Thank you, Dave. Thank you, operator. I think the queue is empty. I do want to thank everybody for joining us today. As you can see, our strategy is driving results. It is creating new growth opportunities for us. We are seeing consistent progress across our business and consult and the hyperscaler work that we spend a fair bit of time on today, but also in modernization and our AI work. We have a disciplined approach. We are certainly managing for the long term. We are confident in our ability to achieve our financial goals, including driving revenue growth, expanding margins, increasing earnings, generating strong free cash flow, and creating lasting value for our customers and for our shareholders and of course for the Kyndryls around the world as well. Thank you, everybody, for joining. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.