Good morning, and welcome to the Kohl's Corporation Q3 2023 earnings conference call. Please note that this call is being recorded. All lines are currently in listen-only mode. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question, press star one again. We kindly ask that you limit to one question and one follow-up question. Thank you. I will now turn the call over to Mark Rupe, SVP of IR and Treasury. Please go ahead. Thank you. Certain statements made on this call, including projected financial results and the company's future initiatives, are forward-looking statements. Such statements are subject to certain risks and uncertainties, which could cause Kohl's actual results to differ materially from those projected in such forward-looking statements. Such risks and uncertainties include, but are not limited to, those that are described in Item 1A in Kohl's most recent annual report on Form 10-K and as may be supplemented from time to time in Kohl's other filings with the SEC, all of which are expressly incorporated herein by reference. Forward-looking statements relate to the date initially made, and Kohl's undertakes no obligation to update them. In addition, during this call, we may make reference to non-GAAP financial measures. Reconciliation of non-GAAP financial measures can be found in the investor presentation filed as an exhibit to our Form 8-K, filed with the SEC and is available on the company's investor relations website. Please note that this call will be recorded. However, replays of this call will not be updated, so if you're listening to a replay of this call, it is possible that the information discussed is no longer current, and Kohl's undertakes no obligation to update such information. With me this morning are Tom Kingsbury, our CEO, and Jill Timm, our Chief Financial Officer. I will now turn the call over to Tom. Thank you, Mark, and good morning, everyone. Kohl's third quarter earnings reflect strong gross margin and expense management, as well as additional progress against our strategic priorities. We achieved this despite a softer than expected demand environment, driven by less than ideal weather and persistent macroeconomic pressures on our customer. Throughout 2023, we have focused on our four strategic priorities, which are: enhancing the customer experience, accelerating and simplifying our value strategies, managing inventory and expenses with discipline, and further strengthening our balance sheet. Our actions against these priorities are working and resonating with our customers. I am pleased with our positive year-to-date stores performance, driven by strong growth in Sephora and, more recently, our home and gifting initiatives. In addition, we have furthered our efforts to simplify our value strategies, manage expenses tightly, and reduced inventory 13% at the end of the third quarter. Looking ahead, the work we have done this year will continue to build momentum and set us up to be successful in 2024. As we've said before, though, it'll take some time for the full impact of our efforts to be realized. Let me now share some additional details on Q3. Net sales decreased 5.2%, and comparable sales were down 5.5%. Digital sales were down 16.5% and continue to be impacted, in part, by our decision to eliminate online-only promotions in favor of omnichannel pricing across the enterprise. While this has pressured our digital performance in 2023, it remains the right long-term strategy for our business. Store comparable sales were down approximately 1% in Q3. Taking a closer look at the quarter, we had a solid back-to-school season, and through the first eight weeks, sales were tracking above our expectations. However, warmer weather during the later part of September and into October had a clear impact on demand for our fall seasonal goods, especially in store. While I don't like blaming weather for performance, the fall transition period has historically proven to be when Kohl's apparel-intensive business is most sensitive to weather fluctuations. We experienced a fairly significant divergence in performance on a regional basis. Store sales in our Midwest, Mid-Atlantic, and the Northeast regions, where the weather impact was most apparent, were down low to mid-single digits in Q3, while all other regions increased low single digits. We have various initiatives underway to de-weather our business as we focus on growing sales in less weather-sensitive categories like beauty, home, gifting, and impulse.... Before sharing an update on our progress against our strategic priorities, I really want to emphasize the importance of our stores' performance. In 2023, we have reestablished our stores as a key focal point of our strategy. This has come in the form of leadership's time and attention, meaningful investments, and new operational processes. Our actions have included expanding our gifting assortment and repositioning it to the front of store, simplifying our in-store signage and graphics, consolidating the customer checkout area, improving our overall merchandising while adding new categories, and empowering our stores to capitalize on opportunities to drive sales in their local markets. I am proud of what we've been able to accomplish so far this year in our stores. The response from customers has been favorable, and this has yielded a return to brick-and-mortar sales growth year-to-date. Let me now turn to our longer-term initiatives and provide more detail on our overarching priorities. Enhancing the customer experience remains our top priority and represents the largest growth opportunity for Kohl's. As I shared on our Q2 call, we believe Sephora gifting, impulse, and home decor, and longer-term, new stores will be the most significant contributors to our future growth, as these are largely White Space opportunities for Kohl's. We're also focused on stabilizing our apparel and footwear businesses by optimizing our assortments to reflect our customers' interests. Let me now share some updates on where we stand on some of these initiatives. Starting first with Sephora at Kohl's. We continue to be extremely happy with our partnership with Sephora and with the results that we are achieving. Based on our success, we have increased confidence that Sephora at Kohl's will be a $2 billion business by 2025. In Q3, comparable beauty sales in the shops opened in 2021 and 2022 increased more than 30% to last year. This is an acceleration from greater than 20% growth in Q2 and mid-teens growth in Q1. We attribute the improving trend to increased awareness and shopping frequency. Total beauty sales increased more than 70% in the quarter, driving additional beauty share gains. We saw strong demand across the entire assortment, including skincare, makeup, and fragrance. During the third quarter, nearly 100 more of our stores received Sephora shops. There is now a Sephora presence in over 900 of our stores, with more than 850 large format and 50 smaller shops. As it relates to our new, smaller shops, we are very pleased with the initial performance. This supports our plan to expand this format to the remainder of the chain by 2025. For the holiday season, we are well positioned, with Sephora featured in 50% more of our stores as compared to last year. We are building on last year's successes within our beauty assortment, significantly growing the number of holiday gift sets, which also supports our broader gifting efforts. We want Kohl's to become a gifting destination. This holiday season, we have significantly expanded our gifting section at the front of the store, and 50% of the gifting assortment is new this year. We have added gift baskets and increased the number of stocking stuffers and personal care gift sets. In addition, we see impulse products as a white space opportunity for Kohl's. Many of our competitors have successfully built impulse businesses through merchandising checkout areas. This holiday season, we are showcasing an expanded assortment of impulse products, and in 2024, we plan to continue installing queuing fixtures in many of our stores. We will merchandise these fixtures with a variety of beauty, wellness, electronics, toys, snacks, and other products. Home decor is another important growth opportunity for Kohl's. Building a home decor business complements our other businesses and fills a void that our customers have historically shopped elsewhere for. To capitalize on this opportunity, we have invested in the merchandising organization and have formed new vendor relationships. In Q3, we began to flow new products into our stores, including wall art, glassware and ceramic home decor, barware, botanicals, lighting, and more. We will drive significant incremental growth in home in the coming years as we further expand our assortments and as customers begin to see Kohl's as a destination for a broader set of home goods. In Q3, our home business outperformed in stores, driven by solid initial performance in our new categories, which are featured more prominently in store. We have also discussed our opportunity to grow our pet business. It is a category that we have invested in through expanding in-store space and broadening our assortment of products like dog beds, cat and dog apparel, and pet toys. The results have been very positive, with Q3 sales increasing more than 40%. We expect to build on this momentum during the holiday season, with plenty of pet-related gift options. As more of our customers recognize our expanded offering of gifting, impulse, and home decor, sales will build. We've already seen this with Sephora, and I'm optimistic that through our collective product and marketing efforts, our customers will respond favorably and allocate more of their spend to Kohl's. My optimism is supported by strong customer feedback and the positive store sales we've achieved year to date. Now, let me provide you with a quick update on the longer-term opportunity to expand our footprint with new stores. We remain committed to capitalizing on opportunities to open new, smaller format Kohl's stores. We recently opened five new stores, completing our new store activities for the year. In total, in 2023, we opened six new stores, completed one relocation, and closed one store. In the near term, we will follow a similar cadence for new store openings, though continue to see a significantly larger opportunity longer term. Turning to our apparel and footwear offerings, there was obvious weakness in our cold weather businesses during Q3. However, we continue to see strength in our polished, casual, and dressy offerings, areas where we have focused our attention in 2023. Women's dresses and men's suiting, dress shirts, and dress pants outperformed in Q3, with solid results across brands like Lauren Conrad, Draper James, Apartment Nine, and Haggar. We were also pleased with the performance of other key brands, including Nike, Under Armour, and Eddie Bauer, as well as our private brands, Jumping Beans and Little & Co. Broadly speaking, however, we have more work to do to improve our overall apparel and footwear performance, and a lot of this work is already underway. Let me share one example. In our juniors business, we are pivoting our strategy by leaning into more domestic market brands for trend-oriented items, while continuing to offer our core basics through our private brands. In doing so, we are reducing lead times in a category where success is dependent upon speed to market. We currently have some of these market brands in select stores and have seen encouraging sell-throughs. This gives us confidence that we will be more relevant in the juniors category as we further scale this year. I look forward to sharing more on the progress of our work in the coming quarters. Now, let me discuss our second priority, which is accelerating and simplifying our value strategies. Kohl's provides great value to our customers. This is evident in the millions of customers that shop at Kohl's on a regular basis. However, for newer customers, we have an opportunity to simplify our offers and pricing to ensure that they too recognize the value that Kohl's provides. This is an important effort of ours and one that we believe can drive overall customer engagement and conversion. During 2023, we have increased the mix of targeted offers and implemented more regular clearance events, while also testing a percentage of our merchandise with clear and consistent price points. In our key value items initiative, which is high-volume pricing on key items in our private apparel and home brands, we continue to see encouraging results with positive sales growth. Customers see these items in our marketing as must-have pricing. They account for just a small portion of our assortment currently, but we plan to scale them more meaningfully in 2024. Our approach has been thoughtful, recognizing the risks of moving too quickly. I am pleased with the progress that we've made to date. Another important component of the great value we provide our customers is our leading loyalty program. This includes Kohl's Cash, Kohl's Rewards, our Kohl's private label credit card, and most recently, our newly launched co-brand credit card, which gives customers more ways to earn Kohl's Rewards. I will now transition to our third priority, which is managing inventory and expenses with discipline. During the third quarter, we had strong inventory and expense management. We reduced inventory by 13% compared to last year, ahead of our goal of planning inventory down mid-single digits%. The new disciplines we implemented earlier this year, where we operate with greater Open to Buy, proved beneficial in Q3, as we're able to stay agile as the demand environment softened. For holiday, we are well positioned from an inventory perspective, with better in-stock levels in core basics as compared to last year, as well as increased investments in gifting and home decor. Our goal remains to increase inventory turns over the long term. From an expense perspective, we were able to manage expenses slightly better than our expectation due to our disciplined focus in a tougher demand environment. We continue to focus on driving expense efficiency across all areas of the company, including reducing our marketing spend and embedding more technology into our operations to drive productivity. Lastly, our fourth priority is strengthening our balance sheet. We remain committed to returning our balance sheet to its historical strength with a long-term objective of managing to a 2.5 times leverage level. Our near-term focus is significantly reducing our revolver borrowings and rebuilding our cash position. We also remain committed to returning capital to shareholders. Jill will discuss our overall capital allocation priorities in a moment. To summarize my comments today, I want to leave you with three things: First, we are repositioning Kohl's. We are executing several important strategic initiatives that will better position the company to drive improved sales and profitability growth over the long term. It includes efforts across the products and categories we carry, the value we offer, the experiences we provide, and the operational processes and disciplines we leverage to manage our business. Second, we remain in the early innings of our growth initiatives. I've said many times that it takes time to build businesses. Our focus has been twofold: One, optimizing our current assortments and embedding new disciplines and processes, and two, adding new relevant products. While aspects of our future vision will be evident this holiday season, they will be even more visible in 2024. I am proud of the work we've accomplished this year, and I'm anxious to see more of our efforts come to fruition in 2024 and beyond. And third, the holidays have always been an important time for Kohl's, and this year they carry even more significance, given that our new strategies will be seen for the very first time by many of our customers. I want to thank all of our Kohl's associates across the organization for their efforts to set us up for success this holiday season. I hope those listening today will get a chance to visit our stores over the coming weeks. I will now turn over the call to Jill to discuss our third quarter results and 2023 outlook. Jill? Thanks, Tom, and good morning, everyone. I will provide additional details on our third quarter results and then discuss our updated fiscal year 2023 guidance. As you heard from Tom, we made additional progress against our strategic priorities and had strong gross margin and expense management in the quarter. Turning to our results, net sales declined 5.2% in Q3 and are down 4.5% year to date. Store comparable sales were down approximately 1% to last year, with continued strong performance from Sephora at Kohl's. Echoing Tom's comments earlier, stores are incredibly important to our business and have been a key focus of ours this year. We are encouraged with the year-to-date store sales up slightly compared to last year. Digital sales declined 16.5% in Q3, with digital penetration of 26%. Digital continues to be impacted by our efforts to simplify our value strategies. Other revenue, which is primarily our credit business, declined 6% in Q3, which is relatively in line with our expectations. As we discussed on last quarter's call, we are seeing payment trends decline and loss rates increase as expected. For Q4, we expect other revenue to perform in line to slightly better than net sales as we start to benefit from our co-brand card. I will touch more on our credit business in a moment. Moving down the P&L. Gross margin in Q3 was 38.9%, an increase of 158 basis points to last year. The year-over-year increase was driven by lower freight costs, reduced digital-related cost of shipping, and further progress against simplifying our value strategies. This was partially offset by product cost inflation. Although shrink remains elevated, it was in line with our expectations during the quarter. Year to date, gross margin was 39%, up 56 basis points to last year. SG&A expenses increased 1.9% to $1.4 billion, slightly better than our expectations as we manage expenses tightly given the softer sales environment. The increase to last year was driven by continued investments in Sephora shop openings, wages, and other store-related expenses. Partially offsetting these were efficiencies in marketing and distribution costs. Year to date, SG&A expenses have decreased 0.2% compared to last year. Depreciation expense of $188 million was $14 million lower than last year due to reduced technology capital spend. Year to date, depreciation expense decreased $46 million- $562 million. Interest expense of $89 million was $8 million higher than last year due to primarily increased revolver borrowings. Year to date, interest expense increased $36 million - $262 million. Our tax rate was 13% in Q3, and year to date is 16%. Net income for the quarter was $59 million, and earnings per diluted share was $0.53. Year to date, net income was $131 million, and earnings per diluted share was $1.18. Now moving on to the balance sheet and cash flow. We ended the quarter with $190 million of cash and cash equivalents. Inventory at quarter end was down 13% compared to last year, exceeding our commitment of a mid-single digits decline. As Tom shared earlier, we feel good about the level and composition of our inventory for the holiday season. Operating cash flow was $151 million in the third quarter and $379 million year to date. In Q4, we expect to drive strong operating cash flow as we move through inventory during the holiday season. Capital expenditures for the quarter were $157 million. This included investments for five new stores, which opened earlier this month, and nearly 100 Sephora openings. Based on our year-to-date spending and outlook for the remainder of the year, we now expect full year capital expenditures to be towards the lower end of our $600 million-$650 million guidance range. Looking ahead to 2024, our initial view is that capital spending will be lower than 2023 levels, given that much of the Sephora build-out is now behind us. We will provide more details on our fourth quarter earnings call. Now, let me provide an update on our capital structure and capital allocation priorities. We remain committed to strengthening our balance sheet. Our focus in the near term is to pay down our revolver borrowings and rebuild our cash position. Over the longer term, our objective is to manage to a 2.5 times leverage level. During the third quarter, we utilized our revolver to fund seasonal working capital build ahead of the holiday season, as expected. At quarter end, our revolver balance was $625 million. Looking ahead in the fourth quarter, we will take another step to strengthen our balance sheet, retiring $111 million of bond maturities. In addition, we expect to significantly reduce our revolver borrowings. As it relates to shareholder returns, our current dividend remains a priority. We paid $55 million, or 50 cents per share in dividends to shareholders in Q3. On November 7, as previously disclosed, the board declared a quarterly cash dividend of 50 cents per share, payable to shareholders on December 20. Now, let me share some color on our updated outlook for 2023. As you've heard today, we continue to feel good about the progress we are making against our strategic priorities. Based on our performance to date and our outlook for the remainder of the year, we are updating our fiscal year guidance range. We currently expect net sales for the full year to decrease between 2.8% and 4% versus 2022, as compared to our previous guidance range of a decrease of 2%-4%. As a reminder, this outlook includes sales from the 53rd week, which is worth approximately one percentage point of growth. Operating margin for the full year to be approximately 4%, which is unchanged from our prior guidance. For EPS, we currently expect full-year earnings per diluted share to be in the range of $2.30-$2.70, excluding any non-recurring charges. This compares to our prior guidance of $2.10-$2.70. Before turning it over for Q&A, I would like to discuss our credit business in the context of recent regulatory developments surrounding credit card late fees. As many of you are aware, the Consumer Financial Protection Bureau, or CFPB, has proposed lowering the late fees credit card companies can charge. If enacted as proposed, it would have an impact on credit card revenues if unmitigated. We are actively pursuing various initiatives to mitigate the effects of this potential ruling. One thing unique to Kohl's is that we just launched our co-brand credit card, which is more reliant on revolving interest fees. Our co-brand card is off to a good start, and as we scale it over the next couple of years, it will serve as a key opportunity to drive credit revenue. In addition to scaling our co-brand card, we are also working on various other initiatives with Capital One, our credit partner, to mitigate the potential loss of late fee revenue. Through these efforts, we feel good about our ability to quickly offset any potential impact within a couple of years. We are closely monitoring developments on this issue, and as you can appreciate, there are a lot of unknowns at this time. We, like everyone else, are waiting on the final rule. I want to make it clear that we believe in our ability to offset this regulatory headwind to our credit business over time.... In the meantime, we are not going to speculate on this topic, as the scale and timing of our mitigation efforts will depend on the final ruling. To the extent appropriate, we will provide an update on our fourth quarter earnings call. With that, Tom and I are happy to take your questions at this time. We will now open the line for questions. As a reminder, if you would like to ask a question, please press star one. Our first question comes from Mark Altschwager with Baird. Please go ahead. Good morning. Thanks for taking my question. I guess, to start out, Tom, how are you currently thinking about the path back to positive comps? Given the longer lead times, you've been somewhat constrained through 2023. What is the timing of some of the bigger changes you expect to take hold in 2024 to drive improved sales momentum? Good question, Mark. We're working hard to really see much more progress in 2024. You know, I've said all along that in 2023 is really rebuilding the company, repositioning the company. As you know, it can't be done overnight, but we have a lot of really good things in place right now, and what I always go back to is the fact that we do have a positive comp for the year in our stores. Our stores really reflect a lot of the new strategies. I mean, our home business is doing well in stores right now. Obviously, the beauty business is doing very well in stores right now. So, I think, you know, I think that's evidence that, you know, in 2024, potentially, we can have a positive comp. You know, the digital business is really what's bringing us down and, you know, as I've mentioned before, you know, we had some things we were doing online that was really not reflective of what an omni company would be doing. A lot of online-only promotions, et cetera, online pricing. We felt that, you know, for our customers, it was important that we have one view on pricing, and obviously, in 2023, that hurt our digital business. But again, you know, a lot of the actions we've taken, you know, will be behind us as we go into 2024. So again, I'm confident about the fact that we are doing well in stores and I think it's gonna be, you know, a good setup for 2024. Thank you for that. I appreciate the color. Maybe just a follow-up as well. Tom, could you give us any additional color on the leadership changes that were announced this week? Sure. Over the past year, you know, I've had an opportunity to evaluate and better understand what the best leadership structure was for the organization moving forward to best execute against our strategic priorities. Some of this organizational structure that was in place really was developed early in my time at Kohl's. You know, I've been very, very involved in the move to reestablish our stores as a focal point of the company's strategy, and based on this, wanted a closer reporting relationship to the stores organization. Similarly, I felt it was important to have the supply chain organization reporting directly to me. Fred Hand, who is now leading the stores, he and I have worked together for over 20 years. We know what each other needs in order to really run the stores organization. So just being closer to, you know, closer to him and closer to just the overall stores organization is key. You know, we are removing this layer. There will be no backfill for this position. Stores and supply chain will now report to me, with other executive leaders assuming oversight of other functions, real estate, purchasing, risk management, and strategy. You know, we are confident that we have the right leadership team going forward and the right structure in place to best execute against our strategy. And I think it'll give us more speed in terms of doing the things that we want to accomplish. And you know, if we wanna get back to positive in 2024, you know, we have to move with a lot of speed. I just feel that now that I've been on the job for a year, I understand what we need as a company, and I decided to execute it. Thank you. Best of luck, and Happy Thanksgiving. Thank you. Happy Thanksgiving to you as well. Our next question comes from Bob Drbul with Guggenheim. Please go ahead. Hi, good morning. Just a couple questions- Morning ... if I could. Good morning. The first one is just on beauty. Can you, you know, give us a little bit more data, just maybe around some of the older stores and newer stores? ...cross shopping, you know, how they're performing. And then on the EDLP, the key item strategy, just in terms of the traction that you're getting, like, how big do you think that could become in the next few years? Thanks. Well, we're performing very well, and obviously, in the anniversary stores overall. You know, we have a 30% comp, which is obviously significantly good, and our overall beauty business is up 70%, if you include the obviously the newer stores as well. But you know, right now we have, like, we have 900+ stores, shops, excuse me, in Sephora, which is very exciting. I mean, it's exciting in many different ways. One of which is the fact that you know, going into holiday now, you know, we'll have 50 more Sephora shops than we had last year. And as you know, and that beauty is a really important category, you know, in the fourth quarter, so we really feel you know, good about that overall. You know, we really, we really expect to hit the $2 billion mark by 2025. Very confident about that, based on what we're currently doing. You know, good news also, it's accretive to operating margin. You know, 40% of the Sephora baskets have an additional category, purchased in the basket. Customers returning for additional purchases for Sephora shop 2 times more often than Kohl's base. Our return on investment, all the capital that was spent, obviously, is very significant overall. And what's interesting is, I mean, it's really across. The performance is doing well across all, all the categories, especially the fragrance business, but we're still doing well with skincare and makeup. You know, and as I mentioned on the last call, excuse me, 30% of the customers that shop Sephora at Kohl's are new to Kohl's. I mean, that is a significant number. And obviously, it's a new customer, obviously. It's younger, more diverse. It's really very important to bring a new customer into the store overall. And there is some ancillary businesses that are performing better than they have. Our junior business is doing better than it has before, so we're capturing some additional sales there overall. But the partnership with Sephora is phenomenal. And we really feel that, you know, the numbers we put out there will be achievable in the near future. So KVIs, your second question. So far, we've done very well with KVIs. It's a small subset of our private brands in apparel and in home. But we've seen a positive comp on that. So we plan to, in 2024, we plan to roll out more high volume price items, KVIs. And it'll be primarily from our private and proprietary brands overall, but so far, so good. But we're gonna be watching it. We're gonna be watching it very, very closely, you know, just because we wanna make sure whatever we do, it's the right thing to do for the long run. But it's good so far, so feel good about it. Thank you. Thank you. Our next question comes from Oliver Chen with TD Cowen. Please go ahead. Hi, Tom and Jill. Within guidance, what's assumed in terms of promotions and merchandise margins? Do you expect traffic to continue to be fairly volatile? Tom, as you've made some nice strides in footwear and apparel, what might be the timing of that impact with the initiatives you're taking—you're putting forward, and also, how they may interplay, you know, with what's happening at Sephora, which is quite remarkable and successful? Thank you. Sure. Good morning, Oliver. I'll start with guidance. I think overall, as we head into holiday, we always know it's gonna be promotional. Promotions are core to what Kohl's has done, and even though I think we've done some great editing throughout the year, you're gonna see us really lean into promotions. In the fourth quarter, I think we've talked about it, we aren't gonna leave ourselves empty from a promotion perspective or do as many cuts as you've seen in the first three quarters of the year, because we know how important it is in holiday, particularly with the uncertainty in the macro environment. We're going to definitely make sure we're delivering the value our customers have known Kohl's for. That's all contemplated in the guidance, and I think when you kind of work through getting to that 4% EBIT, we are expecting to now be at the high end of the 36%-36.5% range that we did give from a guidance perspective. So even with the promotional environment, we've been anticipating this. We know we're going to be competitive, and that's definitely contemplated from a guidance perspective. In terms of traffic, I think we've seen our traffic improve in both channels as the year has progressed. Obviously, a lot of the efforts that Tom has outlined, particularly Sephora being a traffic-driving initiative, has helped us build that traffic back from a store perspective. We're also seeing a basket expansion as well, as that customer is willing to spend a little bit more on that product. So I think it's really a balance for us, but as we've seen a little bit of volatility, like you mentioned, that's more driven by weather patterns, and as we go into holiday, that becomes less of a factor as people really get into that gift-giving mode. Yeah, I just want to piggyback on what Jill said. We are coming out on holiday very aggressively in terms of promotions. Obviously, it's a really important time. It's important time to gain market share, and you know, we're working really hard on it. We did eliminate a lot of layered events in the first three quarters of the year. This year, we're keeping it primarily intact in terms of our promotional efforts overall. So we're well positioned. You know, I talked about in the prepared remarks in terms of everything we're doing for holiday, not only in promotions, but also in gifting and impulse and Sephora, et cetera. So, we're working really hard to do well in the fourth quarter overall. So as far as apparel and footwear goes, Oliver, I would say in apparel, in men's and ladies, you'll continue to see more and more polished casual. It's doing very well. You know, in ladies, you'll see a much bigger presence of dresses, starting really in the month of March, moving through the spring season. It's a category that we've always been underdeveloped in, so we're really making a conscious effort to grow that business. But, it's beyond dresses. You know, we really feel important to drive the jacket business, et cetera. Continue to, you know, get the balance right between the casual piece and the dress-up piece. But we've made a lot of progress, you know? I feel good on what the team has done so far. You just need to, obviously, continue to push on that. In men's, we've done well with tailored separates and dress shirts, and you know, we see that continuing as well as. Also, we feel that not only in men's and ladies, we feel that the polished casual is going to be important in the children's business as well. You know, you'll see a much stronger Easter dress presentation, boy suiting presentations, et cetera. And one thing to connect the Sephora business with is my example in my prepared remarks about the junior business. You know, we know that customer wants trends. Historically, we've gone out and used our proprietary and private brands to go out and buy goods in juniors. What happened was, you know, we didn't have enough knowledge about what was going to work, and so we would go out, and we would buy a lot of goods, and, you know, it would come in 12 months, 14 months later, and it didn't perform very well. Now, we're going to be using the marketplace so that we can react to the business quickly, getting into trends, and we know there's a connection between the trend product and the Sephora customer. So, again, I mentioned in the prepared remarks, but something we're really working on. As far as footwear goes, we still need to work on footwear, to be honest with you. You know, we do have a pretty good position in the active footwear business, but we really need to broaden our assortment. We need more. In both men's and ladies, we need more dress shoes overall, and more, and more casual shoes. We need a broader assortment of shoes for our customers overall. Thanks. Happy holidays. Best regards. Thank you. Our next question comes from Gabby Carbone with Deutsche Bank. Please go ahead. Oh, good morning. Thanks for taking my question. So with gross margins up for 2019 this year, I was wondering if you can dig into the structural gross margin opportunities you have, kind of moving ahead and where you kind of see the biggest buckets still? Sure. I think... Good morning, Gabby. I would say our biggest thing is, you know, we continue to work on our promotional and simplified value, which has been a key contributor, but we've done that, you know, in a pretty thoughtful pace and approach, and we continue to look at how we can use targeted offers. Clearly, our key value items and using pricing more strategically will all be key contributors. Second, and probably I should have said this first, is inventory management. Our big passion around inventory. Obviously, with inventory being down 13%, really focusing on increasing our turns is going to be a key contributor to that as well. So I think, you know, we have a goal of getting to 4+ turns at this point, and right now we're sub that. So we have a big opportunity to really make our inventory work harder for us from that perspective as well. And if you compare to 2019, although freight has been a tailwind for us this year, it still is ahead of 2019 levels. So we'll continue to monitor that and take advantage of the freight benefits that we're seeing in the marketplace and see that as hopefully continuing into 2024 as well and getting back to those 2019 levels. So I think those are the three biggest contributors, inventory management, our simplified pricing, and then obviously continuing to look at the market for freight. Got it. I just have a quick follow-up. On the digital business, I was wondering when you expect trends to maybe normalize there, and what kind of initiative you have in place to help drive growth? As I mentioned earlier, we really feel with having a lot of the online-only promotions behind us as we go into 2024, we should see growth in the digital business. But you know, other things, we're working on the site functionality of the site overall. You know, we're also you know, working on other things you know, behind the scenes to improve the customer experience overall. I don't know if you want to weigh in at all on this. Yeah, I- ... Jill. I would agree with you. I think once we can get past lapping the big moves we've made, particularly on the online offers that we've eliminated and make everything omni, but even just the clarity of pricing, so we show up better in search. So we continue to work on ways that we can show up better in search, and I think not having the complicated pricing that we've had will definitely help us with those algorithms. We continue to work with technology in terms of what those algorithms look like, how we are using those search terms, so we can be much more productive in driving productive traffic to our site. I think the site experience, like we mentioned, so, search relevance, better recommendations, personalization will continue. You know, we have a leading loyalty program. We know a lot about our customers, so continuing to capitalize on that and bring a much more personalized experience to our website. And then just really using the product assortment and curating a much more assortment that's personalized to you and what you've offered, so we can give you better recommendations on what you've searched for, what you've bought in the past, et cetera. So those are all things that are continuing to be in flight but will help us really drive that productivity, both from traffic and conversion. And I think those will play as we go into next year as well. But although it hasn't been great, we have, you know, benefited each quarter. Our digital business has gotten, you know, smaller and smaller, but benefits through these efforts. I think as we get through Q4, you'll start seeing into next year. It will not be as big of a headwind as what we experienced this year. Got it. Thank you so much. Mm-hmm. Our next question comes from Matthew Boss with JP Morgan. Please go ahead. Great. Thanks. So Tom, as we think about your key outlined initiative, gifting, home, beauty, and, and impulse, how best to think about these opportunities for holiday? And what do you see as the sweet spot for P&L results in 2024 as these initiatives scale, just given the associated lead time? So, you know, obviously for the fourth quarter, as I mentioned earlier, you know, beauty is really key. I mean, that's one of the obviously key businesses for the holiday season and beyond. You know, all elements of it, especially gift sets. Also our entire gifting business. You know, when I came in here, a year ago, the first thing I did was move gifting to the front of the store. It was in the back of the store, but we did it like, we did it like mid-December. I mean, it was like very close to Christmas because obviously I started full time on December second. So by the time we got it organized, you know, it was really close to Christmas, and we didn't buy into it. I mean, we just pulled together what we had. This year, we actually, we bought into it as a strategy. We also removed the register bank so that we had additional square footage in order to put gifting in the front of the store. We've also expanded, we've also expanded the presentation into some of the apparel areas and et cetera. So, hopefully, when you go into our stores, you see just a really, really strong presentation of gifting. So that's really key. It's key not only, I mean, not only now, but obviously as we get closer and closer, closer to Christmas. So that's really key. Impulse, you know, it's something that... Impulse is something we've had a little bit of that, but this year we have a lot more, but we're just starting the impulse business, to be honest with you. Right now, we have about 80 queuing lines set up in the company. For 2024, we're expanding the queuing line presentations considerably, so that we have a more structured approach to impulse. We have a captain that's gonna help us run the impulse business, really looking at the assortments, make sure that they're balanced overall. You're gonna see improvement, obviously, in the fourth quarter, but a big improvement as we go into 2024. So the other things that, you know, we're doing well in, if, again, if you go into our stores, we have a very strong presentation in holiday product, our St. Nicholas Square product, and it really hits you as you come into the store by the impactful presentation we have. So, you know, to answer your question, it's really all about beauty, it's all about gifting, it's all about impulse and growing categories, especially in the home that we've really neglected over time, and one of those is pet as well. I mean, we had a 40% increase in pet in the third quarter, so feel good about that. So I will let Jill talk about P&L. Yeah, I think honestly, all these things are definitely going to be key drivers, but we're not going to be talking a lot about 2024. Obviously, in the next call, we'll give you guidance for that, Matt, but I hope in the message that you heard today, this is a build. We're obviously repositioning the company, and we're building in all these initiatives that are really just getting started. And we've seen success from gifting throughout the year, and obviously, we have a lot of that in front of us from the biggest holiday of the year as we speak, but we'll continue to learn from that and take advantage of that as we move into next year. As Tom mentioned, we have 50% more Sephoras, so we'll be able to take advantage of that, not only from a gifting perspective, but the traffic, the new customers that it brings in, and those continue to comp incredibly well. So I think a lot of the areas that we're talking about are white space, which will only help us as we move through 2023 into 2024, but more color to come on our Q4 call from that perspective. Great. Jill, just maybe a follow-up: could you elaborate on the structural changes that you've made with inventory management, as we think about inventory levels on hand moving forward, just relative to the pre-pandemic, maybe 2019 operating model? I think the biggest thing is we have a chase mentality. We're holding back receipts more from a reserve perspective instead of placing all of our orders up front, so it allows us really to be much more agile in reacting. I think in the last two quarters, you saw that our inventory was down more than the mid-single digits that we had told you we were going to run this business with, because we saw we had a little bit softer top line, so we reacted appropriately. We didn't see the need to go and run and chase after that inventory. We feel good that we supported all the key initiatives that Tom has outlined, but we're able to pull back in some of the other areas where we're not seeing those trends. That would not have been something we would have been able to do as well pre-pandemic because we just didn't have that reserve mentality so that we could go out and chase. The other thing that Tom's brought to the table is really just leveraging the market brands, and, you know, we tried to illustrate that through the juniors commentary that Tom had explained. But really being able to use those brands, it allows you to bring it in a lot more quickly. So not being so reliant on long lead times, so really taking what's in the market and getting it into the store and not having as much depth, but knowing that you have a much broader assortment of goods that the customer can come in for, particularly around fashion, because we know that that can be an in and an out. Then that just not only raises sales, it also helps your margin structure. A lot of really good foundational changes that have been made that we're starting to take the benefit of, and you're seeing that through the margin expansion and the tight inventory management in our results today. Yeah, Jill just mentioned we've been buying so deep in each SKU. And it's important in basics, but it's not important in fashion. You want to sell through the product. So, going forward in 2024, you'll see a reduction in the units per SKU when you walk the stores, and it'll give us an opportunity to have more brands, more variety, that'll also help the business and help us turn faster. Great. Best of luck. Thank you. Our final question comes from Dana Telsey with Telsey Group. Please go ahead. Hi, good morning, everyone. As you think about national- Hi. Hi, Tom. Hi, Jill. Hi. Hi. Hi, everyone. As you think about national and private label penetration, what are you seeing and how is it changing, especially with what's going on with the updated chase mentality? And then, Jill, just on the other revenue side, on credit revenue, any updates to the health of the consumer? What... How bad debt or delinquencies are trending? Thank you. Well, we're going to change the mix slightly in terms of having more national brands versus our private label and proprietary product. And a lot is going to come from market buys. You know, Nick and I have been in New York frequently and really looking for different brands that we can carry. A lot of it has to do with, obviously, we're proud of our brand portfolio, and we want to build upon that, but also we want to leverage the marketplace more often, you know, really looking for really more interesting product to put on our selling floor than we had previously. So that'll change the mix. We still feel our private and proprietary brands are important, but we also feel that we need to integrate into our assortments on the selling floor things that are from the marketplace. So we're working on that. And then in terms of credit, Dana, I think, you know, the biggest thing is we do know the consumer is under pressure. Particularly, we serve the middle-income customer, which we see is definitely pressured. We did take steps, I think, over a year ago in understanding where the market was moving and really taking on less risk in our portfolio, anticipating that we were going to start to see loss rates move up, which we have seen, but they've been in line with our expectations. So losses are moving up, payment rates are coming down. The payment rates, though, are still ahead of 2019, so it does say that the customer is still, you know, healthy enough to make their payments, and we're not seeing the loss rates above what we anticipated, but they are definitely deteriorating from what we had seen historically, all of which we've embedded into our guidance and our outlook for the rest of the year. Thank you. Thank you, for everyone that was listening on the call today. Have a great Thanksgiving. Go shopping. Thanks. This concludes today's conference call. You may now disconnect.