Good morning. I'm Juliet Cunningham, Vice President of Investor Relations. I'd like to welcome you to NuVasive's 2022 Investor Day. We are going to have a very packed day for you, and we're gonna do our best to stay on time. Our speakers today include Chris Barry, CEO, Matt Harbaugh, CFO, and Ryan Donahoe, CTO. The format for our meeting will be to start with presentations. We'll have a 15-minute break, and then we will welcome Dr. Paul Holman from Houston Methodist in Texas, and Dr. J. Alex Thomas from Atlantic Brain and Spine in Virginia to our surgeon panel, which will be moderated by Ryan. After that, we're gonna hear from Matt Harbaugh and Chris Barry for his final remarks. We're gonna go on to Q&A. After Q&A, we will go downstairs for product demonstrations, which will be great. Looking forward to that. Before we get started, I wanted to remind you that today's discussions will include forward-looking statements, and these statements are based on current expectations and involve risk and uncertainty, assumptions and other factors which could cause NuVasive's results to differ materially. Forward-looking statements include, but are not limited to, statements regarding NuVasive's financial guidance for 2022 and longer-term financial and business goals. Please refer to our safe harbor statement and our SEC filings for detailed information. In addition, today's meeting will include a discussion of several financial measures that are not calculated in accordance with generally accepted accounting principles or GAAP. We generally refer to these as non-GAAP financial measures, and please refer to, again, the safe harbor statement, for more information about non-GAAP measures. Today's meeting is being webcast live on the investor relations page of our website, and following the meeting, there will be a replay available, and the presentation slides will be there too. Now it's my pleasure to welcome Chris Barry to the stage. Thank you. Thank you, Juliet. Thank you, and thank all of you for making the trip. Some of you are a little bit closer than others, I think. For those on the West Coast, you're welcome. We're here in San Diego. Maybe not sunny San Diego, but San Diego. Hopefully it'll be a little shorter ride home for a lot of you. I'm excited to have you here at our, I think our beautiful West Coast Experience Center. We planned to have events here in the past, and I think our grand opening was scheduled for April 2020. Didn't work out, but we're here now, and so I'm excited to open up this campus. Hopefully, you'll have a great day. As Juliet said, we got a packed agenda. I'm gonna go through some slides. We're gonna have Matt Harbaugh talk as well. I'm gonna introduce you to Ryan Donahoe, our CTO. I don't think you've seen him before. He has a lot of exciting things to talk about. I'm excited for you being here. I'm actually more excited for what we're gonna tell you today. I'll tell you this, I'm more excited than I've ever been about the future of this company. I truly believe that we're set up to innovate and grow more than we've ever been, in a better position than we've ever been in the past. Hopefully over the next couple of hours, you'll get a sense of that, and you'll get some excitement about what we're talking about. Let's jump in. What I'm gonna introduce you today, and what you're gonna see over the next couple of hours, is what I consider to sort of be the new NuVasive. Maybe not sort of be what we're really talking about when we talk about the new NuVasive. It's building upon our foundation of innovation, but it's evolving, and it's evolving our company to take on new challenges and really setting the course for the next evolution of innovation here at NuVasive. I'm gonna start with this slide, and I'm gonna spend some time on this slide because it's gonna be an essential slide that really threads throughout everyone's presentation over the next couple of hours. Three fundamental strategic pillars of our growth. The first is core growth. Continued momentum in our core businesses and our globalization efforts. This is something we've talked a lot about. I think it'll be familiar to you, but I think some of the things I'll share with you'll be surprised and excited. I want you to take away from core growth confidence that there's durability and runway in our core business. I'm also gonna introduce this concept of intelligent surgery, taking what we've done with Pulse, but extending our presence and our solutions to support pre-op through post-op. Intelligent surgery is new. We've been talking about it, we've been thinking about it for a long time, but we haven't necessarily shared our vision. With this one, I want you to, number one, understand, hopefully get excited about the vision and what we believe our opportunity is to really change the standard of care in spine and really redefine who we are as NuVasive. Rounding out sort of the two innovation strategies is this market opportunity strategic pillar. This is just really us confirming and committing to continually pursue, aggressively pursue attractive market opportunities to really complement our core growth, to continue to round out our intelligent surgery strategy, and to really upgrade and support the overall improvement of our financial profile as a company. Three strategic pillars that you're gonna see throughout the day. Keep these in mind. Again, confidence in core, understanding of intelligence, and just understanding of our commitment to complementing our growth with attractive market opportunities. There is a little key on the right upper hand corner. You'll see in any given slide if we're talking about core, intelligent surgery, or market opportunities. Just to help you sort of keep track of where we are within the presentation. Where are we today? Kind of before we start to get into where we're going, I've been CEO now for four years this month. I can tell you the company is a very different company than when I started. We were a less invasive company, but now we're leading in areas that we weren't four years ago. We were the XLIF company, but now you'll see over the course of the next few slides, we've extended that leadership position in others, in other areas of spine, other key segments. We're now innovating areas in areas outside of spine, Specialized Orthopedics. We've complemented our innovation in core spine with our focus on enabling tech. We've been talking for a while about globalizing the business. I think you've all seen we've been consistently outpacing the market in the international segment, with our international sales now nearing almost 25% of our overall revenue. We're growing consistently above market. Growing above market and building momentum. Now this is something I talk a lot about, and I've talked with you guys a lot about this. I think sometimes it's hard to understand what's going on specifically in spine. It's a lot of players. It's a volatile market at times. It's sometimes hard to get through quarter to quarter who's actually growing and to what extent. I look back, and if you look back over the last five years, we've consistently grown multiples of market. If you look even shorter term, over the first half of this year, we believe that when we look at the assessment of, like, the top 10 spine companies, makes up about 80% of the market. We look at that, and that group is roughly flat if you compare them together. We were growing at 6.2%. If you take into account constant currency, we're growing closer to 8.5%. Clearly growing the business and building momentum as we go along. The momentum is really fueled by innovation. When I think about where we are, I look back to where we've been. You know, we started the XLIF procedure 20 years ago, a game changer, disruptive procedure in the market. We really started this segment, and this segment now has grown up to about a $450 million. We think it's a subsegment of anterior, but a healthy segment that NuVasive started, and we continue to lead in. As we look forward, we've now evolved to a full-line spine company with breadth and depth, now participating not just in the $450 million segment, but the full $12 billion spine segment. We've done this through this concept of X360. Now, we've talked about X360 in the past, but I wanna make sure we just take a second to really unpack what is X360. It's really our strategy that drives our differentiated product portfolios. It's a comprehensive, procedurally integrated solution or solutions as you start to look down to below and where we've applied it. Any given component in a spine surgery doesn't make or break the procedure. It takes a systemic approach to complete the procedure. We've taken this 360 concept and applied it to lateral X360, cervical C360, and prone P360. We're also applying the same methodology to complex spine surgery. We'll talk more about that, and Ryan will unpack this a lot in his section. You'll get a lot better perspective as to kind of what's going on in each one of these segments. Let's start with XLIF. XLIF, the most clinically backed procedure in the market, 15 years of solid clinical evidence. As I said, it's a $450 million subsegment that we call lateral. It's a game changer for us. It's how we built the company, but it's one approach, one procedure in one subsegment. The team did a fantastic job, and in 2019 we launched X360. X360 was the first comprehensive approach to single position surgery. What this does is gives the surgeons flexibility to do multiple procedures in a single position. XLIF, now they can do XALIF, they can do XFixation. One approach, multiple procedures in one segment. You fast-forward now to where we are. We took the same X360 methodology and applied it to cervical, prone, and applying it to complex. Now driving a market position from the XLIF days of $450 million to the full $12 billion market with a comprehensive portfolio across all the key segments of spine. Breadth and depth. I want you to remember breadth and depth here of what we have brought to the market with still some exciting new product launches that Ryan will talk about here in just a little while. Okay, another word to remember, breadth and depth, also runway. I wanna call your attention to the right side of the screen. This is the $900 million anterior segment in spine where you have XLIF, ALIF, OLIF, other procedures. We clearly started our focus in XLIF. You've heard me talk, we own 40%-50% share. That was a U.S. number. If you look at the global number, we're still the 40% share leader in lateral or XLIF. You look to the right, through X360 and some key new product introductions, we turned our focus now to not only XLIF, but also the ALIF procedure. Some of that's through X360. Now we've amassed 15% share in ALIF and are now the market leader in both XLIF and ALIF. That's happened over the last three years. We've complemented our growth strategy in XLIF with significant growth in ALIF, and that continues. We've seen strong growth throughout this year in both XLIF and ALIF. You look at the comprehensive opportunity we have in the anterior segment, we're still roughly 28% market share. We still got good runway in our flagship procedure and the overall anterior space. Shifting gears, again, runway. This is the cervical market. Cervical market is a huge market. The biggest market in spine. $2.6 billion or I should say the biggest procedural market in spine. A $2.6 billion segment broken into these three subsegments, ACDF, anterior, PCF posterior, and the cervical total disc replacement. Now I'll call your attention to. That's a picture of the Simplify disc which we acquired in 2021. You may have heard me quote the market size over the past several years. When we bought Simplify, it was 2021. We didn't have good market information from the 2020 because it was COVID impacted. We had market information from 2019. Our market information from 2019 probably reflected the actual market of 2018. At that point, we said it was a $250-$300 million market. Preparing for this meeting, we refreshed the data from a third-party source, and the data came back at a $450 million market. To give you some context, now the cervical total disc replacement market is roughly the size of the lateral market. We've got significant growth in this segment as well as ACDF and PCF. We've not only bought Simplify, we use the C360 strategy to completely overhaul the cervical portfolio. We've enjoyed 20%+ growth the last three quarters, and we think that's a durable growth engine for us going forward. Still only 6% of that market. Roughly 6% is where we sit today. We're excited about this opportunity and we're completely dedicated to being the leader in this space, just like we're the leader in XLIF and ALIF going forward. Again, runway. The pattern here, we focused on anterior, and we're the market leader in both subsegments as well as the overall market leader in that segment. We've turned our focus to cervical. We've also got and are just now in the early days of turning on the P360 strategy. We got active projects coming through on complex adult and pediatric deformity. Significant breadth and depth, significant runway. Again, still staying in the core growth strategy. We've also recently launched our Pulse platform. We think enabling tech enhances our spine procedures. It's part of the proceduralization strategy. Not only are we adding or delivering the hardware solution, we're now adding navigation, rod bending, intraoperative neuromonitoring into that systemic approach. The key for us and the value proposition we've been talking about with Pulse is utility. Can we put a system in the market that has full utility within the entirety of the procedure and across the breadth and depth of all the procedures? What competitors, I think, have failed to do is accomplish utilization and application. Our goal is to create a system that supports our surgeon partners throughout their procedures and has familiarity across all the procedures they perform. We've built this with the future in mind. We use this term extensible architecture, so we can continue to enhance the value of our system over time through adding new applications. We've got robotics on the horizon, but continuous improvement of the system through new application. There's not a competitive product on the market like Pulse. There's navigation systems, there's other technologies, but not an integrated platform that we represent when we talk about Pulse. So we're excited about what this provides to us in our core growth. It also will be a foundational component of when we talk about intelligent surgery and how we bring that to life. Within the core as well, globalization. It's been a durable growth engine for us. I'm very, very proud of how we've performed. Even though the last couple of years have been super challenging. The teams have done phenomenally well. Since 2018, you see our overall percentage of net revenue from the global markets has increased from 19.5% to almost 25% group. I recently was at the ribbon cutting in Singapore. We're not done. We'll continue to add experience centers to support our growth. We're excited about the globalization effort, and we're excited about what we can do. We still have opportunities within the markets we're playing in today and opportunities to extend our business in the markets that we haven't entered yet. We're excited about globalization. Let's wrap up core, at least from what I wanted to talk to you about. Again, I said in the core, I want to hopefully get some confidence that this is a durable growth engine with runway. Through 360 strategies and the procedural runway we talked about, through our entrance in enabling technology and through our globalization efforts, we're confident we can continue to grow multiples of market just within our core. Kind of brings us to the next strategic pillar. I'll say this, that we believe at NuVasive that data will be the next innovation in spine. That our ability to collect and disseminate data pre-op, intra-op, and post-op will be the differentiator ultimately for how patients do. We call this data and our pursuit of data intelligent surgery. Building on our innovation and our leadership position, we look to transform the entire patient experience from pre-op through post-op, and ultimately help the surgeons ultimately achieve their desired outcome. If you look at spine today, generally, we only participate in the surgical execution phase. I think it's obvious when you talk to the surgeons, when you talk to, you know, really anyone that has insight to spine, you come up with this word variability. There's variability. A lot of that variability comes from some of these questions that are at the bottom of the page here. How do surgeons select the right procedure? How do they select the right patient for the right procedure? How do they execute the right procedure, and how do they achieve and confirm the desired outcome? That's not necessarily always answered intraoperatively. How do we actually start to bring to life intelligent surgery? We believe it transforms the care pathway and ultimately will transform NuVasive. Again, full participation to understand the condition, to understand the procedural selection, to support the surgical planning, to continue to support the surgical execution, participate in recovery and tracking, and ultimately confirm the desired outcome. That's our goal, to participate across the patient care continuum. We think we can do that and ultimately redefine the standard of care through real-time data and advanced planning pre-op, continuing to innovate intra-op through advanced tools delivering real-time information, and ultimately standardize and automated intelligent devices that give us insights to and confirm that the desired outcome was met. This is our vision of where we wanna go next. If I could say the next evolution of NuVasive innovation, which is hard to say, and I won't say it too many more times 'cause I'll butcher it. This is, in our opinion, the way that we truly change outcomes and set ourselves apart. If we do this, here's where I think we're, you know. Clearly, the patient's benefited. I think the surgeon and the clinicians have benefited, but how are we benefiting NuVasive? I think it comes through accelerated share gain. I think it's a catalyst to consolidate the market as we create more touch points and more stickiness to our business. Lastly, if we do it well and can exhibit less variation and more predictable outcomes, it has the opportunity to expand the market. This is our vision for intelligent surgery. We're excited about where we're going. Ryan will unpack this a lot more in his section and tell you about some things that we've already done and things that we plan to do. Those are the two innovation strategies, core growth and intelligent surgery. Now we talk about market opportunities. For market opportunities, we'll continue to invest in underrepresented segments. We did the Simplify acquisition, a great acquisition for us, hitting on all cylinders on that acquisition. We're looking for more. We're aggressively looking for those segments that we believe complement our core strategies. But we're also, you know, looking for opportunities maybe outside that of traditional spine. This is intelligent surgery, software-related applications that support our pursuit of data, both collection and dissemination. It expands the aperture of how we define spine and potentially allows us to build upon the NSO franchise and the specialized orthopedics business. On the other side of the equation, I use this word on the header, dispassionate portfolio management. We're gonna take a dispassionate approach to assets that aren't creating value for us, whether that be product families, geographies. We're gonna keep a close eye to ensure that we create leverage and opportunity through dispassionate portfolio management. What happens if we execute on these strategies? If we execute on core X360 strategy, procedural runway, enabling technology, continue our pathway to globalization, if we could bring to life intelligent surgery, complementing that through M&A and additional market opportunities, I believe we're on our path to create a company that's hitting revenues of $2 billion with increasing operating margins to 18%-21%, over the next five years. We're excited about this opportunity. If we do this, who will we be? Who do we strive to be? Who do we aspire to be in 2027? Number one, continue to be the innovation leader in spine and specialized orthopedics. Continue to develop and extend our global opportunity by continually globalizing the business. We wanna bring to life this intelligent surgery concept and truly change the standard of care. We'll continue to redefine and be an evergreen company by aggressively pursuing those opportunities outside of our core. Again, $2 billion business growing well above market, generating 18%-21% non-GAAP operating margin. With that, I'll pause. I'll bring up Ryan Donahoe, but before we do, we'll open up with a quick video. Good morning. I have to tell you, I'm excited for the opportunity to be here with all of you today and to tell you that our innovation is comprehensively differentiated, and it's evolving beyond just intraoperative solutions to now broader solutions to impact the entire spine care pathway. This is important because this continues our momentum of above-market growth that only accelerates as we unlock additional value through intelligent surgery. By the end of our discussion, I expect that all of you are going to share in the confidence that we have in our continued growth and future success. Quickly introduce myself. I'm Ryan Donahoe, Chief Technology Officer for the company. Started at NuVasive back in 2006. We were a small $100 million spine player. I have to tell you, it's been incredible to see how our innovation has impacted the lives of millions of patients worldwide. As we think from there, you know, our innovation strategy is really the foundation of how we move forward in the future. I have been intimately involved from the early days with XLIF, seeing how we've evolved our innovation, both clinically validated, now have moved into X360 and Pulse and intelligent surgery. Now in terms of what we're going to focus on today, I want to call you back to Chris's slides on our three fundamentals of growth. Really innovation becomes a core part of driving our continued momentum and core growth. We're going to talk about exactly how we do that with an X360 portfolio, and then how we expand from there with Pulse. Number two into intelligent surgery. Before I do that, I want to start with our design philosophy as a company. This really guides how we think, how we act, how we innovate. We call it outcome-driven innovation. Really how it works and where it starts is we work with the very best spine clinicians across the globe. We really define the gap between where we are today and better outcomes. We clearly dissect that and figure out what are the key needs that we need to solve for. We rapidly develop and iterate. We take advanced tools, enabling technology, integrate an optimized technique that's supported through clinical training, and then we create this very seamless proceduralized workflow that is highly reproducible. Why does that matter? What does it result in? It results in the things you see on the right-hand side, clinical, operational, financial outcomes. What's an example of this? Like what does this look like when it gets translated in the OR? We'll talk about XLIF. This is the very best spine procedure as evidenced by the largest volume of scientific and clinical data that's been amassed over a 15-year period. With XLIF, we take access, fixation, biologics, interbody enabling technology, procedurally integrate them together. It's been reproduced over 300,000 times. What's the impact clinically, operationally, financially? I'll give you a couple examples. Number one, increase operating room efficiency by 15%, reduce surgical revisions by 50%, reduce perioperative costs by 10%, reduce hospital stay. Those are very important financial impacts. This gives you a sense of the power of XLIF. I'll tell you, we're not done innovating. We've got a lot of really exciting innovations that I'll talk about in the next coming slides about how we're continuing to advance XLIF. This unique core capability that we have as a company, we have now extended into the X360 portfolio. We'll talk about the exciting innovations we recently launched and what's coming next. I want to call you back though to Chris's slide on the runway. When you think about where we are with X360 and the larger procedural share that we have, still a ton of opportunity to grow. It's important to know that we've deliberately sequenced our X360 innovation. Moving from X360, we said, you know, what are the most important procedural segment opportunities that we should be able to tackle with our innovations? We put an intense focus within cervical. A lot of recent investment, as Chris said, have completely overhauled our entire portfolio that I'm excited for all of you to get hands-on with at the innovation showcase. We'll talk about what's launched and what's coming next. We're moving from there from cervical to P360 and complex. Now as we look at all of these procedural categories, the runway we have ahead, it's important to know that we're not done innovating. We're actually continuing to innovate in every single one of these. You'll see the breadth of the portfolio at the innovation showcase, and I'll show you exactly what's coming next. Really 15%-20% of our total revenue every year comes from the introduction of new products. We'll dive into specifically what those are. When you look at this slide, it's important to know I'm not going to show you the entire portfolio. We have that available in the showcase for you to get hands-on. What I am going to zero in on and focus on is what we recently launched in the market as well as what's coming next. This is not the full gamut of the entire pipeline we have of exciting internal and external innovation, but really gives you a sense of some of the key new product introductions that are enhancing our X360 portfolio. Let's start on the left here with X360 Modulus ALIF. This is taking our advanced material science technology, expanding it into ALIF. We've gotten tremendous feedback on this system to the point that, you know, we're number one in lateral, but now we are the number one worldwide leader in ALIF procedures as well. From there, we're going to build upon that success with Modulus ALIF Blades. Gives us another fast, rapid in-OR deployment capability that continues the success of that platform. Another exciting innovation specific to X360 is coming next is the Modulus Expandable TLIF. Taking again the Modulus technology and architecture, applying it to expandables. We take our very intimate 3D printing manufacturing knowledge and know-how to reduce the cost of what was formerly a very expensive type of expandable technology. It creates very durable economics moving forward. Not only do we have these better economics, but we have enhanced performance. This expandable, unlike other expandables in the market, can expand simultaneously in multiple planes, creating a very optimized fit for the patient that creates stability that's important to outcomes. C360. Talked about really a complete overhaul, and we have an incredibly comprehensive portfolio. You may have caught the recent announcement of Reline Cervical. We just commercially launched that platform. This now takes the Reline which is formerly a lower thoracolumbar spine system and now extends it all the way up, to the base of the skull. A lot of really positive feedback about the safety elements that we built in, which are important when you're operating around an exposed spinal cord in the back of the neck. Simplify. You know, a couple really two key points on Simplify. Number one, this is the only CTDR in the market with superiority to fusion at one and two levels. It's the only CTDR in the market with the highest clinical success rate. You think about what Chris talked about, now the CTDR market being on par with that of the lateral market. It's a high barrier to entry given the regulatory burden. We feel incredibly positive about our position with Simplify to really accelerate and capture growth. We're really not done there in terms of innovating in this platform. You know, when we acquired the technology, it was a gen one instrument set, and so we're taking our advanced instrument design and applying it to the Simplify solution and rolling out additional enhancements to help really make the learning curve faster and continue to drive even more adoption. Then ACP, this is the lowest profile cervical plate. It's like, well, why does profile matter? You know, in the front of the neck, there's very limited anatomical space to be able to fit these devices in. So having the lowest profile gives us a unique advantage. Really now you see we've completed the foundational pillars of C360, but we're continuing to innovate and drive more solutions to market. We'll move over to P360 on the right here. Again, taking the advanced material science technology, applying it to prone implants. We really took a hard look at, you know, the high volume of prone procedures that are out there, particularly TLIF and PLIF. We asked ourselves, "Why is there so much variability in the outcomes?" One of the key elements to driving reproducibility and removing variability, or driving reproducibility and removing variation, is access. We really looked at the access systems that are currently available in the market. There hasn't been meaningful innovation in minimally invasive TLIF access in over 20 years. We saw it as an opportunity to come to market with a really unique tube system that gives higher levels of safety when operating around very sensitive, neurovascular structures, then also really facilitates a faster workflow and creates a lot of versatility in the OR. We've gotten tremendous feedback on that system, not only in fusion procedures, but we're now seeing it used in the higher volume decompression procedures as well. What's next? Similar to what I talked about on XLIF, Modulus Expandable for TLIF and PLIF. This is, again, a multidimensional expandable, gives us the opportunity to create a patient-specific fit. Then ProNeX SLIF. You know, I'll tell you, the vast majority of the cases that we see in lower lumbar go all the way down to the sacrum. In those situations, we firmly believe on the left-hand side, X360 is the best solution. However, we realize that there are certain clinical situations where prone positioning of a patient may be required or even preferred to be able to do an XLIF. We currently accommodate that. When we looked at the prone lateral solutions that are in the market and the lack of data to support them, we feel compelled to really come to market with the best option. That's what we're doing with advanced ProNeX SLIF. From there, we'll move in to the far right here into complex. These are the most technically challenging procedures within spine, spanning pediatrics to adult. We really looked at all the different deformity techniques that are very entrenched with surgeons based on their experience and training, and we said, "How can we harmonize those into a simple but powerful platform?" That's exactly what we did with Reline 3D. The unique thing about Reline 3D is it doesn't require surgeons to abandon their former deformity techniques, but instead allows them to increase the power of their correction and to do it more safely and more easily in the OR. Next to come, Reline One. This is a single-step K-wireless screw. This is really important in the sense that it's not just applicable to complex, but really now completes the application of Reline across all these procedural segments. We've got a really good positive feedback about the simplicity and how it has so much less fiddle factor than all the other K-wireless single-step screw systems on the market. Another important thing to mention, you know, I've organized these procedural 360 solutions in these verticals that you see. While all the individual elements within them are designed to seamlessly integrate together with the existing portfolio, it's also important to understand that individual elements, just as I mentioned with Reline, may be used across from left to right. What you'll see as you go down the innovation showcase is we created what we call technology branding, where there's very similar form and function, so that regardless of where a surgeon initially adopts one of our 360 portfolios, we then really facilitate the ability to then quickly learn and adopt another. That's an exciting capability that we have as a company, part of our outcome-driven innovation philosophy. Let's talk about Pulse next. It's important to know that Pulse is really enabling every single one of these procedural verticals and integrates with all of them. In fact, we look back to the Pulse data of the hundreds and hundreds of cases we've completed, we actually see a pretty fairly even distribution across these verticals. The other thing about Pulse is this really becomes the foundation of intelligent surgery. What I love about Pulse is we designed Pulse with the future in mind. Again, this isn't a navigation platform. It's actually much bigger than that. It's an ecosystem that it created that allows us to have organically developed software applications and accessories, as well as bring in third-party applications. On the right-hand side, you can see the depth and breadth of all the capabilities within Pulse. Every single thing that we're doing within Pulse to enable the X360 portfolios is really geared towards enabling safer, faster, smarter surgery. We have an incredibly healthy pipeline ahead of a lot of different new capabilities and different applications. One of the ones that I know is of interest is robotics. Let's talk quickly about robotics. We've made a lot of really good progress. We've had some comprehensive set of surgeon labs, gotten good feedback. We've made system changes, and we're now moving into the next step, that's integration testing. That'll really inform the next steps in the program. As we look at robotics, we're making sure that we're really looking at the current limited utility and what it may become in the future. We're effectively throttling our focus between robotics with the rest of the R&D platform within Pulse that is very synergistic. You know, now as we move forward and we'll think about intelligent surgery, it's important to know that Pulse really becomes the bridge from population health-based solutions to individual surgeon and patient solutions that are incredibly important. We'll call back to Chris's slide here. Moving on from the first core growth innovation pillar, now we're moving into intelligent surgery. This is really where we break the paradigm away from intraoperative solutions only and start to impact the broader spine care pathway. This, to us, is really the next evolution in innovation. We've talked you through the XLIF procedure. You've seen the clearly documented substantial value creation, the philosophy that it's created for us as a company that we've now extended into X360 portfolios enabled by Pulse. Intelligent surgery builds on all that and accelerates our leadership position. Before I jump into intelligent surgery, specifically what it is, I want to ground everyone on the current state of spine care. We're going to do that through a patient's lens and then move on to surgeon and hospital. From a patient perspective, clearly, they need better outcomes. This isn't a small problem. We're talking where 577 million patients worldwide every year deal with back and neck pain. What's really the challenge here and what's really needed, and Chris alluded to it, they need data-driven clarity in terms of what's the best treatment option for them and what they should expect in terms of recovery. For the surgeons, you know, they really need better tools and insights. Despite all the advancements we've made, we still see things like 18% of patients requiring reoperation after a common condition like lumbar stenosis. How do we arm surgeons with real-time data and insights intraoperatively to better translate a surgical plan into the OR and ultimately lead to better recovery and outcomes? We move on to hospitals, and we think about the current macroeconomic environment. We have over a third of U.S. hospitals currently operating on negative margins. Spine service lines are expensive, and when you add in the cost associated with things like 14% 30 days readmission rates, you know, that are oftentimes not reimbursed by payers, then emerges a clear need to generate better financial results through spine technology. Really in summary, as we think about it, today's outcomes just aren't good enough. As an industry, you know, we've made some strides, but we're not reacting and evolving quick enough to really generate better value. This is where we took a step back as a company, you know, looking at all this, and we asked ourselves, "Why aren't outcomes better? We've got great technology. What's really missing?" What we found is there's a ton of variability across the entire spine care pathway, and it's not just intraoperative, it's preoperative and postoperative. This data plot here gives you a really good sense of that. On the bottom axis here, we have what's called a pain and disability index, a score that the patient was given before surgery. On the Y-axis, we have 12 months after surgery. Now, this is for common spinal indications. These dots that you see in the middle of the screen here, these are patients. On the lower right in green, these are patients that went into surgery. 12 months later, their pain and disability is better. That's what we hope for. That's the outcome that we expect. Then you see the dots in blue. These are patients that 12 months after surgery are doing worse. Not only do you see that, but you see how much variation there is in all of the data. You know, this is where we went to really dissect what specifically is happening and how do we attack it with intelligent surgery. We're gonna work our way from left to right. Let's talk about pre-op. You know, surgeons faced with a patient coming in with over 70 different spinal conditions. They got 15 different procedures to choose from. There isn't really data-driven clarity in terms of optimizing all those variables into the right treatment. We carry that through into intra-op. You know, and our surgeons are also faced with over 200 now spinal implant manufacturers. As we look at, you know, what's happening in the industry, you know, we're on average sending over 400 implants to every surgery, yet only 4.5 are used. That creates tremendous cost to serve burden for us as a company, but then also costs within the hospitals to reprocess and sterilize all the inventory that they don't use. Clear economic opportunity for us to bring better solutions. We chase that through to post-op. You kind of look further out, you know, at a spine patient's journey, and up to 45% of the time they're gonna require another surgery after the first one. You can imagine with every subsequent surgery, typically the complications and the outcomes go down. What's the cost of a readmission? You know, it's not cheap, $67,000 on average. As we look at all this, we see a distinct opportunity to really deliver better solutions to manage and reduce downstream healthcare costs. How do we do that? It's really through intelligent surgery, we systematically improve the spine care pathway. The key is to really creating objective measures and data insights that we can deliver at every single point along the way, digitally connected, make this entire spine care pathway easier, more reproducible, less variable, and all that relates and corresponds to better outcomes. Now I wanna dive in and tell you specifically how we're gonna do that. We'll go back working left to right, starting on pre-op. Intelligent procedural selection and planning. I'm proud to announce that we've established a partnership with a French-based company called SMAIO. They give us access to the world's largest database of spine patients. A surgeon can have their diagnosis, their pre-op images. We have the option of them performing their own planning or sending it to the Surgimap team, who will send back three surgical options. This isn't just planning for alignment that you see with a lot of the competitive systems. Those three options come back with outcomes of comparable patients. Now you're planning for alignment correction, but really more broadly, you're planning for optimized outcomes. This is an exciting partnership that we're making a lot of great progress integrating all of our implants directly into it. We go from there and we move into intraop. We see a huge opportunity here with intelligent instruments and tools to bring real-time actionable data to a lot of the subjective steps that happen in spine, but also to increase and improve the workflow velocity with additional levels of safety. You heard me talk about the Modulus XLIF Expandable. What I didn't mention is that it includes a smart, intelligent instrument. What this does is, as the implant's expanding, it automatically senses the pressure between itself and the bone. It automatically adjusts its surface to create a patient-specific optimized fit, and it prevents potential damage to the bone that we know is related to impacting outcomes. This is just the very start for us of a plan for intelligent instruments and tools that really bring the technology with implants to the next level. We go into post-op intelligent implants. You know, the fact is when a patient leaves surgery, you know, they're digitally connected from the rest of the spine care pathway. A lot of how outcomes are reported, you know, is self-reported from the patient, and there's diagnostics that are done post-operatively. We really ask ourselves, you know, why can't the implant provide more automated real-time information and be directly reporting on a daily basis to the surgeon whether or not it's succeeding or failing? The reality is we're very uniquely positioned to integrate novel electronics like that into our implants because of our 3D printing know-how. We see now a huge opportunity to really bring to bear digital technology that can automate recovery workflow, can give early warning detection, and help start to drive down the downstream healthcare costs associated with bad outcomes by creating standardization in how recovery is tracked and how outcomes are measured. Those are some really key fundamental building blocks, and I've showed you how we've already made progress on all of them. Now, as we've gone through the spine care pathway with those becoming in place over time, we've created high-quality data. We've taken the big variables in spine that just don't have objective measures, and we've standardized them. Then we can take that, and this is where artificial intelligence now has the power to create prediction. We have the high-quality data, we input it into a platform like Pulse, and now we can start really creating prediction starting from the beginning of planning and can incorporate real-time data in a simple, convenient, actionable way for surgeons. This is further out, but this is really ultimately how we digitally connect the entire spine care pathway and transform surgery. Then we move into kind of the summary here. You know, we really see this as a huge opportunity to transform the spine care pathway, but NuVasive as well. A lot of what you saw about the high cost to serve, the ability to have informed planning to deliver only specifically what's needed in surgery, we really truly believe this is gonna define the standard of care. How do we do that? Again, through real-time data and advanced planning, advanced tools delivering real-time information, and then standardized automated intelligent devices. In summary, hopefully that gives everyone a really good sense of how our innovation is comprehensively differentiated, how we're moving from intraoperative to now impacting the entire spine care pathway. I hope that all of you share in the confidence that I have in our future success and our continued growth with our innovation. I encourage all of you to spend the time to go to the innovation showcase and get hands-on. We're now gonna take a 15-minute break, and then we're gonna come back, and we're gonna bring up our distinguished surgeons for a very exciting panel discussion. Thank you. All right. We're gonna go ahead and get started. I'd like to welcome Dr. Alex Thomas and Dr. Paul Holman up to the stage here, and we're gonna kick off our surgeon panel discussion. Gentlemen, maybe where we could start is you obviously have tremendous experience in spine surgery. If you could share a little bit about your background, your expertise, your practice, that'd be helpful. My name is Alex Thomas. I'm a neurosurgeon in Wilmington, North Carolina. I have been in practice. I trained at Georgetown in lateral surgery since May. I do predominantly degenerative spinal surgery. I'm just a small town country neurosurgeon. I'm not like sophisticated like Paul, but a lot of experience with lateral surgery and now moving forward to single position surgery. Thank you. My name is Paul Holman. I'm the chief of spinal neurosurgery at Houston Methodist. I'm an academic neurosurgeon. I'm in the business of training doctors. I did my residency at Baylor and a spine fellowship at Cleveland Clinic. I'm a very early adopter of enabling technology. We got the fourth OR in the United States, and by, I think, 24 hours, the second Pulse in the United States. My practice is spinal deformity, but I also do minimally invasive surgery. Awesome. Thank you. To start with you, Dr. Thomas, you know, we talk a lot about this concept of proceduralization, and you kinda heard it, you know, echoed throughout the slides. In one particular point, I talked about all the different procedural options that there are to address patient pathology. We think about X360, for example, with all the alternatives that you have available to you know, why do you choose X360? What makes it different for you and your practice? Like I mentioned, I'm a community private practice neurosurgeon. I am obsessed with efficiency in the OR and speed in the OR, not because I wanna get home faster, although my family does appreciate that, but because we know it's clearly related to better patient outcomes. The faster you can get that patient out from under anesthesia, the better. One of the limitations, like I said, I've been doing XLIF for a long time, and one of the limitations for XLIF and lateral surgery is that there are all these different position changes that you needed to do to execute on the procedure. Flip from the lateral position to the prone position for the screws. If you were doing an ALIF at L5-S1, start with the patient on their back, do an XLIF, flip to their side, do the screws, flip to the belly. That for a 2-level surgery, that's a whole day affair, at least it used to be. X360 really has solved all of that for me. First we started just by, all right, let's not flip the patient for the screws and let's just put the screws in with them on their side. We started doing that several years ago, and even that alone allows you to do a two hour XLIF in 1 hour. Then when you add the ALIF in the lateral position, you can do a complete reconstruction of the patient's spine without ever moving the patient. Like true front-back fusion with these huge spacers without ever moving the patient. It still sounds like it's contrived, but I still get amazed when I see the outcomes when you can do these surgeries so quickly. To me, that's what it's all about. It's being able to not have to sacrifice efficiency to be able to execute these true front-back reconstructions. It's been incredible to see. Yeah. You bring up a really good point, and I imagine a lot of your surgeries involve, you know, all the way down to the sacrum. You talked about ALIF and some of the larger footprints. Maybe you can expand upon, you know, with X360, what's really the benefit of being able to do an ALIF, you know, at the base of spine, say, versus, you know, a prone procedure? Sure. I mean, I think the best way to think about it is the larger footprint of spacer that you can get into the disc space for a fusion, for an interbody fusion, the better. I mean, it's a very simple way to think about it, but I think most spine surgeons would agree with that. How do you still get big spacers in the front of the spine and not have to waste all this time flipping patients over? To me, ALIF in the lateral position was kind of the crux, the kind of solve. It's like the linchpin of X360, right? This position strategy. You can have the patient in a lateral position and still get that huge spacer in the front of the spine, and then move to your XLIF and then move to your screws. Again, not having to sacrifice the ability to put those big spacers in for the sake of efficiency. I love. We can talk more about prone surgery. I love prone lateral surgery for very specific indications, but the main crux of that is, okay, you do this beautiful reconstruction at L4-5 and above with your prone lateral cases, but then what do you do at L5-S1? Do you put a little dinky PLIF spacer in there, that's, you know, 30% the size of an ALIF spacer? Do you take the time and waste all that time flipping the patient to do a supine ALIF? X360, including ALIF in the lateral position, is really the only way to do that. The only way to do these big spacers in such an efficient manner. Yeah, that makes perfect sense. I guess, Dr. Holman, you know, moving on to you. You referenced having a lot of experience enabling technology, and been involved in the early years of, you know, the legacy systems that are out there. With Pulse having been moved into your practice and you having actually some of the most experience with Pulse, where do you see that Pulse is different from the other options that are out there with enabling technology you could choose from? Yeah, it's really interesting. Iain Kalfas was my fellowship mentor that kinda got me hooked on navigation. Navigation initially was an enabling technology to put screws into the spine. Everyone kinda takes it for granted that you can put a pedicle screw in the thoracic spine, but I mean, really the whole pedicle screw era started in the early nineties. Routinely when I was a resident, we would have, you know, patients that would go back the next day for a new, you know, nerve pain, and you realize there was a pedicle screw breach. It really solved kind of an unmet need and, you know, that's really kinda how I you know developed my academic career on navigation. Now we've solved that problem and, you know, a big part of my practice is complex deformity. We're always trying to look for new technology. I mean, neurosurgeons, we love new technology. I mean, we're fascinated with the brain. I thought that kind of robotics was gonna be that answer for me. I lost a little bit of credibility when we purchased our robot about four years ago. Really, it didn't solve the problem of making complex deformity surgery reproducible, more efficient. We already could put screws in the spine with navigation wherever we wanted. When I looked at Pulse, I saw it more as a platform to be able to do more of the things that we needed to do, you know, with these complex surgeries. Yes, the core foundation of this system is navigation, and it has to be accurate. That's accurate. We've established that. If you look at the features like radiation reduction, everyone knows a spine surgeon that's gotten cancer. In fact, one of our radiation techs just got leukemia. Being able to use the radiation reduction capability of Pulse, we're doing that with our XLIF. We're making this kind of key portion of deformity surgeries using lateral ALIF, and we're, you know, being able to leverage that technology to reduce the radiation exposure and also just make the surgery more efficient. Probably the thing that most people don't realize about scoliosis surgery is that the outcome is very, very dependent on how you realign somebody's spine. We have these technologies like Surgimap, you know, free software, so we're doing a lot of preoperative planning. One of my fellowship mentors used to say, you know, we kind of do all this planning, and we kinda come into the operating room, and we, you know, want to deliver these precise things, and we're kinda hitting everything with a chisel. You know, we're not really executing the plan that we've, you know, spent hours and hours trying to perfect. We use the IGA portion of Pulse. Once we correct the spine, we can make measurements and say, "Did we get the lumbar lordosis to PI-LL mismatch?" Basically, we need to correct 50 degrees. Did we get 50 degrees? Did we distribute the lordosis between the upper and lower part of the spine? This aspect of Pulse is solving the problem of trying to deliver the preoperative plan at the point of care in the operating room. You know, just the safety profile in terms of neural monitoring. I didn't really use a lot of, like, screw stimulation before Pulse because it's kind of, you know, you have to rely on in-house monitoring. We use the, you know, kind of the expanded neural monitoring capabilities of Pulse as well. In terms of minimally invasive scoliosis surgery, there's definitely a place for that, and I would consider Bendini kind of the first smart implant for deformity surgery. We can do ALIF, XLIF, and correct, you know, smaller curves. What nobody ever talks about is, okay, you can use navigation or a robot to put the screws in, but then how do you bend the rod? How do you get that rod without pulling out the screws? You're basically passing the rod underneath the muscle. Bendini has been probably the most important enabling or smart implant to enable minimally invasive scoliosis surgery. Again, for me, I went back to my administration and said, "I think that Pulse is kind of the next generation of navigation. It's navigation plus." It's a real. We kind of liken it to your iPhone. You have all these different apps. If I'm gonna do a minimally invasive one-level fusion, I might use two or three of the applications in Pulse. If I'm doing the full scoliosis deformity correction, I'm pretty much gonna leverage everything that Pulse has to offer. It's the other thing I would mention is just, you know, the imaging system. Pulse, we have both O-arm, and we also have the Cios Spin. It's, you know, if you're in a hospital where you only have O-arm or you only have a 3D C-arm, Pulse is compatible with both of those systems. The other thing is operative efficiency. As Alex mentioned, you know, we have to do these. These are long surgeries. These are, you know, patients in their early seventies. Nobody really kinda talks about how anesthesia affects your brain. Every you know five or 10 minutes that you can save, you're going through these complex operations, all of a sudden, five or 10 minutes for each of these steps translates into an hour of efficiency. Specifically with scoliosis surgery, we found that using the Cios with Pulse, we'll sometimes inject bone cement into the screws at the top of our construct. If when we were using O-arm, we would have to take the O-arm out of the room, then bring in a C-arm, and then once we corrected the spine, we would get a digital a special machine that can do a long deformity X-ray. Basically get the whole spine on one X-ray. With Pulse, one of the other cool features is that we can actually do that with the same intraoperative imaging system. We can take an image and stitch it so we can get the whole spine. Again, we're trying to really nail down that correction because we know that's what drives outcomes. Yeah. No, absolutely. It sounds like you're seeing significant utility in all of the applications within Pulse, customizing some of those for particular surgeries. You know, through our partnership with Siemens and the Cios, a lot of advantages intraoperatively as well with that imaging platform. Thank you. Dr. Thomas, you also have experience with Pulse. Anything you'd like to add from your experience? We're about, I think, about six months into our Pulse experience, and admittedly, I was a bit skeptical about bringing navigation into my OR because, again, I'm working on speed and efficiency. I try to get in and out as fast as possible to take care of as many patients as possible. I thought, "Okay. Is this gonna be like a lot of other quote unquote enabling technologies that really just slow me down?" But in fact, it hasn't. I wish there was a way to show a picture of how we use navigation to work simultaneously now. You can keep the patient on their side and it's, again, sounds contrived, but it's really a beautiful thing to see. You have this patient on their side and all these sophisticated technologies and moving parts working around the patient, to execute on the case. What Pulse allows us to do, this is my workflow for say, an L4 to S1 fusion, which is a super common case, for degenerative spine surgeons. Get the patient on their side, do the XLIF. I'll put the pin for Pulse in the crest, obtain a spin with the Cios. At that point, I call my access surgeon in. He's gonna start working on the approaches in front of the spine, and while he's working there, I'm working at the same time on the back of the patient using Pulse to place the screws so that the screws are already done before he even gets to the front of the spine. We can work simultaneously like that. You can cut out so much extraneous time from the procedure. You can routinely do an L4 to S1 fusion, again, with these huge, powerful spacers in 80-90 minutes. There's just no other way to do that. Being clever in deploying Pulse has been really beneficial for us. Great. Yeah. Thank you for sharing. Moving on now to intelligent surgery. Can we talk about the importance of objective measures and data? As you look at in your entire practice and the outcomes you see with your patients, where do you think that those can make a difference and really drive improvement? Yeah. I'll start with that question. As I mentioned, you know, we know that all this technology, all the implants add a lot of value to what we do, but it's really the preoperative planning that is proven to be, you know, kind of the foundation of translating the surgeries that we do into a happy patient. I'm very excited about the relationship with SMAIO because we really need a way to take the data that we obtain in the operating room, look at our preoperative plan, and really then track the outcomes and see. We think that there are everyone kind of thinks that the alignment is the only thing that really matters. We know Chris Ames, a very well-known neurosurgeon, is doing a lot of work looking at other factors that need to be built into, you know, a sophisticated data platform, things like genetics, bone density, osteoporosis, muscle sarcopenia. I really see kind of intelligent surgery as linking together all the different variables and then using, you know, artificial intelligence to kind of say, you know, who are the patients that we really should do these big surgeries on. One of the things that, you know, really concerns deformity surgeons is when you look at healthcare, we're getting into this era where we're competing for healthcare dollars. If you look at the amount of disability that a patient has with deformity, it's similar to someone that has cancer or diabetes. If we do one of these operations to correct scoliosis, and then we get something called PJK, basically the patient's spine adversely reacts, falls apart, usually happens within six weeks of surgery, then you have a $100,000 revision surgery. If that's not a sustainable model. We really need to leverage, you know, our intraoperative assessments, did we deliver the plan, and then collect that data, look at these other patient outcomes, and really make all of this kind of a bidirectional relationship where we're collecting data and analyzing using artificial intelligence. If we don't capture some of these things intraoperatively, to really know, did we nail the plan, you know, then we're really kind of missing a big opportunity. Yeah. No, it makes perfect sense. Dr. Thomas, anything you'd like to add to that before we move to the next. I mean, it's just so frustrating about spine surgery, and patients don't get this either, you know. It's just they think it's as simple as like taking their car to a mechanic and swapping out one part for the other. It's like black and white outcomes. So frustrating for me, and then by proxy the patients, is that you can execute a surgery perfectly, beautifully, beautiful post-op X-rays, and sometimes the patients just don't know better. Thankfully, it doesn't happen that often, but that's one of the frustrating things for me, and I think spine surgeons in general. How do we use Pulse? How do we use data to, like you said, pick the right patient, do the right operation, and then make sure they have the best possible outcomes? As long as we've been doing spine surgery, that's still the crux of what we do. I'm excited to hear that that's the direction that the company's headed because I kind of view Pulse as sitting at this inflection point between, all right, what I call like the metal phase of spine surgery, where it's all about implants and screws and spacers and materials, and then the transition to, all right, true kind of data-driven outcomes and how do we use data to predict who's gonna do well and why do they do well? That's what's really cool. That's what I'm really excited about to see where Pulse goes in the next kind of 5-10 years. Yeah. No, that's great. So we talked about the importance of objective measures and data. As you think about the future of enabling technology, there's gonna be new innovations required to be able to deliver that to you in a very simple, easy to use, actionable way. What do you think are the best ways, best technologies in the future that you see to be able to do that? Maybe Dr. Holman, let's start with you. Yeah. I think that, you know, we kind of talked about smart implants, but, you know, we're interacting with patients in a different way, you know, with we all have our smartphones and so forth. I think some type of implant where you can track the progress of a fusion. We know that if we can come up with new ways of knowing whether or not someone's gonna develop a pseudoarthrosis, it might change our decision to use a bone stimulator or add a medication like Forteo or Tymlos with osteoporosis medication. We know that PJK, where the rod breaks, some type of intelligent way of tracking real-time the forces that are being transmitted through the rods and tracking that on the smartphone and looking at that data week by week, and then maybe trying to intervene or do something to prevent, you know, an outcome that would lead to a revision surgery. I think it's gonna be, you know, the development of some of these smart implants looking at, you know, data that we can analyze and feed back into like this, you know, like a cloud-based thing where the doctor can track things, the patient can track these things as well. That's great insight. Thank you. Dr. Thomas, for you know, as you think about, again, the future of enabling technology, you know, what are the innovations that you think are important or not important? Well, I think the smarter implants are really cool. I think if you just imagine the potential for smart implants, I think it's fascinating. I mean, you know, we don't have a good way to track patient compliance. We don't have a good way to really understand what's going on inside of the patient. You know, there's this technology that kind of scratches the surface of that, but I think that's super exciting. It sounds nerdy, but super exciting. I think I'm all for enabling technology and technological advances, but there has to be a balance between, you know, not making things overly sophisticated so that you kill the efficiency of the operation. I think that's gonna be the key point moving forward is how do we bring these technological advances without just inundating the surgeon and making things overly complex? 'Cause you're already seeing that in some fronts. Yeah. I'm really excited. You know, Pulse is really kind of this foundational platform and, you know, there's gonna be hardware advances, but also software advances. I think, you know, for me, I mentioned robotics before and how, at least in my hands, it really was a big disappointment. You know, if you look at robotics for like prostate surgery, that really was the first operation where the robotic platform became a game changer. One of my orthopedic partners always tells me, "When the robot can expose the spine, then I'm gonna wanna buy one." I do think that in the future, robotics is gonna be integrated with Pulse in the operating room. We really are waiting for when is. We refer to a robot more as a cobot. It's not that the robot would be doing things for you, but interacting and making you a more efficient surgeon, kind of like artificial intelligence. I think something like endoscopic spine surgery and how we might incorporate that with robotics. If we can decompress the spine, if we can do things very minimally invasive, we can already, you know, put instrumentation in percutaneously. Can we really do the work on the spine with limited access with small instruments? That's probably what I would say in the next, you know, maybe 10 years, that could be a game changer. We really need to develop the technology to look at, you know, what can we do other than put in screws? Yeah. Mm-hmm. Well, I'd like to thank you both for your time. I appreciate all of your insight, and it's very helpful. All right. Next, we're gonna move on to our CFO, Matt Harbaugh, is gonna join us on the stage. Thank you, Ryan. Really appreciate it. Our guests have a seat. We failed to thank the people on the webinar today, earlier. We're really appreciative of those of you that could make it here, but we've got a large number of attendees. I'm speculating that no one wants to down-click in the financials beyond what, Chris presented earlier. No, I'm just kidding. I've already seen some of the questions. I'm gonna try and answer some of those questions in the formal presentation. When we're done here after Chris' final remarks, we'll move into Q&A. As you've seen this slide, I'm gonna try and give you more color on core growth. I'll probably talk a little bit less about intelligent surgery 'cause that's farther out in the plan. Then I'm gonna do a down-click in market opportunities. As we're thinking about our business, as Chris mentioned earlier, the business this year has been growing at 6% this year on an as reported basis. Obviously, it's 8.5% or so on a currency adjusted number. We're pretty comfortable that we can do a global CAGR of 6%-7%. You can see the composition of the growth. One of the questions that came in was, you know, how do we see the international business growing? If you do the math here, the international business would be a $500 million revenue business for us in 2027. Then the U.S. is still gonna continue to grow. It'll be about $1.2 billion, but it'll be, you know, going from 75% down to 70%. You say, "How are we gonna do this?" We've talked about our X360 strategy. Got a great runway there with that. We've got Pulse growth. We've got globalization. We've got all these new products that Ryan was talking about. We also have our Specialized Orthopedics business, which we had a challenge last year, but this year it's been growing really nicely for us. We had a really strong second quarter, as we talked on the last earnings call. We're also gonna talk about margins here in a little bit. We've got to drive profitable sales growth. We've got to find efficiencies in our supply chain. We've got to get leverage out of our SG&A. You know, from an R&D perspective, we really put pedal to the metal over the last couple of years and have increased our R&D, but we see that moderating as we get into the future. You look at the $2 billion that we talked about earlier that Chris went through, and you can see that takes our compounded annual growth rate from 6%-10%, which is really, really exciting. That's core growth plus upside from M&A, and we'll talk about M&A here in a little bit. You know, the U.S. business has very different dynamics than the international business. From a US perspective, you say, how do you get to the $1.2 billion from where you are today? The answer is, we got to continue to maintain our leadership in anterior. Chris mentioned the success we've had in XLIF. We've got to drive ALIF, and we're confident we can do that. We need to aggressively grow in cervical. As we announced on the last earnings call, we've had three quarters in a row where cervical grew greater than 20%. We need to keep that up. We also need to introduce these new products in posterior that Ryan talked about at length. Some new news here is Pulse. We anticipate low to mid double-digit growth in this plan. We're very confident in that platform, and I think, after hearing the surgeons, that validates where we're thinking the product is going to go. Internally, we use the term density, which you'll see on a future slide, but we really are focusing on our customer mix in the United States with an eye towards driving margins. I just want to point out that 4%-6% growth, that was one of the questions that came in over the chat, 4%-6% for our US business. From an international perspective, you can see we're predicting 11%-14%. That's very consistent with what we've said over the past number of years. If you've been listening to Chris and I want to say, on the heels of our last Investor Day in 2019, we've said low to mid double-digit growth in international, consistently. Coming from the show me state, one of the questions should be, well, how are you so confident you're going to go from 25% - 30% in your revenue mix? For me, the answer is, if you remember the slide that Chris presented earlier, going from 19.5% up to 25% today, that seems very achievable to drive another 5%. From an international perspective, the X360 strategy is early on in its phase. We've placed more units in Pulse in the United States by far than we have internationally. Lots of opportunities. The international team is very aggressive in wanting to get Pulse. Specialized Orthopedics, we see some great growth in that business. We kind of break our business from a Europe and Japan perspective. We have very strong leadership positions in key markets in Europe and Japan. In fact, in Japan, we're a number two player. If you say, how do you envision those countries continuing to grow? The dynamics are pretty interesting. A lot of the larger players have been good share donors. In large part, we've seen a lot of the smaller competitors leave the market or have problems in the market. You know, we've got beachheads that are very, very strong. As we look at Asia Pacific and Latin America, we have a great runway. Small businesses, but great upside to continue to grow them. We'll likely are and plan to supplement that growth by continuing to pursue other countries where the value proposition makes sense. One of the things, though, that we're very focused on, no matter what we do, is driving both the top line and the bottom line. From an operating margin perspective, to get to that 18%-21%, we want to do strategic moves, both from a business development perspective or from a country, additional country perspective. We want to make sure we do it in a thoughtful manner, that we don't bring in business that makes it harder to get to our targets. Let's talk a little bit more about the P&L. I think we all know about the macro environment pressures that we're living under right now. You know, we had more currency fluctuation in our second quarter than we'd seen, you know, on the previous year combined. That's a challenge. Inflation is a challenge. You know, I'm sure many of you saw the announcement that OPEC is cutting production. You know, the quick question is, what is that going to do to the price of oil, and what's that going to translate into from a freight perspective? We're monitoring it, but it is a challenging time. We also have the EU Medical Device regulations that are coming into the market. We put on here that it is a headwind, and the reason we do is from a regulatory viewpoint, the regulations are expensive. When we knew that these were coming over the last couple of years, we actually intentionally started to winnow down our product offerings to minimize the expense that we foresaw from a, you know, regulatory compliance perspective. It is a headwind because it puts pressure on the profitability in our European business. This being said, it actually could also be a tailwind for us because assuming that the larger players also looked at their portfolios and the expense burden that this would cause and are thinking very thoughtfully around their position in the European market. Then with the smaller players, if you're coming into the market over the last couple of years and you couldn't turn profitability, this just makes it a lot worse. Hard to say whether it's a headwind or a tailwind, but I'm sure we'll be talking about this in the quarters and years to come. Spine market price pressure. I've had two of you already this morning ask me around how pricing is unfolding. You know, we're very lucky. It's been in the low single digits. We've said, you know, consistently one quarter after the next. You know, for our business in the U.S., it's about 1%-2%. It's worse for our competitors near as we can tell from their public disclosures, but it's been incredibly consistent despite all the challenges that have been going on in the marketplace. Turning to tailwinds, I can't emphasize this enough with core growth, with the X360 system that we've been talking a lot about today. You know, the pull-through we hope to get and plan for from an intelligent surgery perspective. As I said earlier, we're pretty bullish on our ability to deliver on this plan. Global commercial scale and customer density, I mentioned that earlier. We are taking a very thoughtful approach as to what customers we bring in, what customers we maintain, because we wanna get deep relationships with surgeons, with hospital networks and systems. We're gonna be increasingly careful that we focus on the right customers that are gonna drive our business to deliver on this plan. Finally, as I mentioned earlier, we are going through, as we speak, a very significant program to reduce our stock keeping units. NuVasive has not focused on this historically. We think it's gonna unlock some value in our gross profit or gross margin. And the other thing this allows us to do, it allows us to also address the pricing issue that we talked about earlier. That as we reduce the SKUs over time, does that afford us the opportunity to move surgeons to higher value products, as we take products off the market that are older and probably come at a lower price point. We also know we've got a great opportunity for absorption in West Carrollton and Memphis for that matter. In particular at West Carrollton, they have done a phenomenal job, and they've proved it out to us through the integration of Simplify. It's been a remarkable story for the company. We know when we insource products that we can drive a significant opportunity in our margin. After we kinda get through the stock keeping unit reduction, we're gonna take a really hard look at the remaining SKUs and see what we can bring in insource rather than continue to outsource those products. We're excited about that. Over time, with the strategies that we have in place, we do see a pathway to reduce our SG&A as a percent of net sales. We've already had some success there. It's just hard to see with some of the inflationary pressures that we're living under right now. Turning to the balance sheet side, you know, we wanna sustain a very strong balance sheet. Not on the slide, but I just wanna remind everyone we have over $200 million in cash on our balance sheet as of the end of June. We'll give you an update in November as to where we landed at the end of the third quarter. We do have our convertible notes coming due in June, and we're continuing to monitor the market. We feel good about doing a debt offering based on market conditions. Very exciting for me, the cash flow generation that this business offers is fantastic. As you can see, this plan, we anticipate generating $800 million-$1 billion in free cash flow. That's gonna be really important as you turn your attention to the right side of this chart around prioritizing M&A. Chris outlined this $300 million incremental focus we're gonna have to get to that $2 billion mark earlier. We're gonna be able to accommodate the acquisitions through the cash generation that we foresee from a free cash flow perspective. We're gonna be as aggressive as possible. We're gonna do both acquisitions and divestitures, but it's all for an idea of how do we drive our margin profile and get into that 18%-21% on the slide that we presented previously. I hope you fully appreciate core growth, and how we foresee that playing out, getting us up to that $1.7 billion. The market opportunities are gonna help us refine the P&L and improve our profitability across up and down the P&L. Can it be any more excited around delivering on this plan? With that, I'll turn it back over to Chris. Thanks, Matt. I just wanted to take a second here. We've obviously went through a lot of information today. It would be a travesty if I didn't at least recognize the fact that all these core strategies, these strategic pillars. Would not be possible without the great people within the organization. I've been, like I said earlier, I've been here four years this month, and I'm, you know, continue to be impressed. I continue to be humbled by the focus and the efforts they put forth. We've done a lot, redefined our culture, really instituted diversity and inclusion as an organization, recently published an ESG report. We're seeing tangible results by investing in our people, and our people continue to really be the foundation and the competitive advantage for us as an organization. All right, so we'll get into Q&A. Before we do, just a reminder, one last time, not that you haven't seen this slide 25 times, but this will be the 26th. Three fundamentals of our growth. We've been a growth story. We have, we are, and we will continue to grow, building upon these strategic pillars. Remember what I said at the beginning, confidence in our core. Hopefully, we've exhibited to you that we've got durable growth with significant runway to drive the short, the mid, and the long-term growth for the company. We feel very good about the breadth and depth. We feel very good about our opportunities from a market perspective. Moving to intelligent surgery, hearing from our surgeon partners, appreciate you guys again coming in. Data, both collecting and disseminating data coupled with continued innovation within our broader portfolio, we believe uniquely positions us to win and actually set the new standard of care. I'm excited about the intelligent surgery piece. Wanted to introduce you to it. We're gonna be talking a lot about this as we go forward. Moving to the market opportunities. Matt just hit this. You know, intelligent surgery will require us to do things outside of traditional spine. We'll continue to look for aggressive tuck-in. Simplify has been a fantastic acquisition. You know, we wanna find more opportunities like that. We'll also continue to look at just other attractive market opportunities to truly complement the growth profile of the company. I'll end with sort of where I ended the first piece. I couldn't be more confident and excited about where we are. We're committed, and I believe we're positioned well to continue to differentiate ourselves in spine and beyond. We'll continue to double down on our globalization efforts. I think we've got healthy runway there, great leadership with a healthy opportunity to continue to drive new product introductions there, quite frankly, generationally behind markets. We've got a lot of technology that we are yet to actually push into those markets. I think hopefully you understand our commitment to be the intelligent surgery company. Our next evolution of innovation at NuVasive is intelligent surgery, and we're committed to bringing that to life. With that, we're excited about this opportunity to become a $2 billion company over the next five years with increasing levels of profitability driving us up to that 18%-21%. Again, thank you for your time today. I appreciate you guys coming. Those on the phone, we'll now shift gears to Q&A. I'll let Matt and Ryan back up, and Juliet can moderate. All right. Thank you so much. We've got questions both from the live audience here and online. I wanna intersperse and be fair to both. Why don't we start with over here, Vik? Hey, Vik Chopra, Wells Fargo. Thanks so much for the day and for taking the questions. I have two, one for Matt. Matt, do you see the 6%-7% growth rate being consistent over the next five years? And how should we think about the margin ramp? And then, one for Chris. Chris, you talked a lot about M&A over the LRP. How are you thinking about a transformational deal outside of spine? And have you begun to identify any targets? Thanks so much. I'll start with your first question. Thank you. The reason we put a range in there, and we had many a healthy debate, as you might imagine, as to how wide a range we put on that, 'cause in any given year, you're gonna have new products coming in or new products that are maturing. We put a range on there to make sure that we kinda cover some of those very variables. Excuse me. You know, we think we're gonna be delivering in that range on a pretty consistent basis during this plan. The source of M&A, source of transformation. Listen, I'm probably more apt to say I like the tuck-in strategy. I like what Simplify has done for us. We'll look for other opportunities to build upon the portfolio and complement our portfolio in spine. As you would suspect, we would also look at what intelligent surgery requires us to do. That may be some things that I consider sort of non-traditional but required. That may not be acquisition, it could be strategic partnerships like we talked about with SMAIO. I kinda click down from those down into then potentially building on the specialized orthopedics. I'm not necessarily looking for a transformational outside of spine. Clearly, we'll always keep our options open to creating value, but that case is how I sorta think about it. A virtual question here. What are we expecting in terms of market share growth in cervical? I mean, you know, I think I showed you the slide of 6% in totality today, about 6% of a $2.6 billion market. I think I've said this pretty clearly. We look to be the market leader in cervical. End of story. I'm not gonna try to sit here and predict when that's gonna occur. I honestly, off the top of my head, don't even know who is the market leader today. It's likely Medtronic or J&J, but it doesn't really matter to me. We're focused on the C360 portfolio and fully actually get on the Simplify opportunity. If we do those two things well, I have no doubt in my mind we will be the market share leader. We continue to grow 20%+ a quarter, and I see that durably over the future though, so I think we're well on our way. Yeah. One thing I would just add to that is we were really excited when we saw that $450 million number, because you know, we had used lower assumptions, rightly so, when we did the deal, as Chris mentioned. One of the things I'm really excited about is the global opportunity we have, whether it be Simplify or what have you, because we really focused on the U.S. market over the last 18 months with Simplify as an example. Now that we've got supply, I'm pretty excited at what we can do internationally as well. Question from the room. Shagun. Can we please have you identify yourself and your firm just so that we know? Shagun Singh from RBC Capital. I actually have a three-part question. First on revenue. You're talking about global revenue CAGR of about 6%-7% versus prior 5%-7%. It appears just based on your underlying performance recently, Simplify by our math, it adds at least about 60-80 basis points, as well as Pulse. It seems like you are probably being a little bit conservative there. Overall, the 6%-7% profile, should we assume that to be conservative or realistic? On margins, the 600 basis points margin expansion through your LRP, how much of that LRP period, any color on 2023? I know that's a big focus for investors. They're assuming about a 90 basis points expansion. Just on innovation, you know, I was wondering if you can just talk about some of the timelines, specifically the first in man for Pulse Robotics in 2023. Thank you. We feel it's a very achievable number. I wouldn't say it's conservative. I wouldn't say it's aggressive. I think that if you think about the relative opportunities that we see, with the breadth and depth of the portfolio, that is still unfolding as we speak. You know, Ryan mentioned several products that are, you know, we're on the horizon of launch. So continued execution anterior, continued execution in cervical. Our board look at both posterior prone and also complex. And the early days of Pulse. I think we're appropriately giving a good range there in a market that, quite frankly, has been volatile over the last couple of years. Even the uncertainty, we feel pretty good about those numbers. As far as Pulse Robotics, we continue to execute on the Pulse strategy in general. We're not renewing any sort of timelines today on robotics. We're committed to this idea of intelligent surgery. As we continue to think about how we proceduralize our entirety of our technology, where does robotics fit, we'll continue to look at where that takes us going forward. We do believe it's a part of our future. As we complete certain milestones, we'll continue to communicate. I will say that robotics today is not an impediment for our growth. Simply not. We continue to grow in light of not having a robotic system. As we think it's a part of our future, and we'll continue to update you as we move forward. So Yeah, it's a little too early to be speculating on 2023, right? We're six days into the close on the third quarter right now, and we need to digest that and then, you know, execute on our plan for the full year. What I am hoping is that the world gets a bit more settled. I talked about those macroeconomic challenges that are out there. I was not happy to see what OPEC was doing, because I immediately look at that and say, "How should I be thinking about that for our business?" Hopefully things will settle out. What I would say is, from an input cost perspective for the products we make, we've been able to navigate that very, very well. I know other companies are getting much higher price increases and challenges. We haven't seen that anywhere near to the degree others in med tech have. I think, Shagun, also you asked, correct me if I'm wrong, you asked about margin expansion and is that in the earlier or the latter part of the long-range plan. We wanna drive the margin as fast as humanly possible, but it's not gonna happen overnight. Ryan? I think we said he was gonna be last today, but we'll see. Just to be clear, Chris, you did say I would be the last question today after our Yeah. Thanks for reminding. Ryan Zimmerman, BTIG. Thanks for calling on me. Couple questions for me, guys, if I may. You know, I thought the most interesting comment you had today was about divestitures and maybe laying off a few assets that have been underperforming. Chris, I'm wondering if you could speak more to your thought process around that. I mean, we can all look at NCS as being kind of one of your more challenging businesses through the years, biologics. You know, if you divest that, maybe it adds 70-100 basis points of growth. You know, some of your peers have thought about this before, right? They've tried to lay off some of their underperforming assets. The market's now left with other companies such as ZimVie, if you will. You know, how do you think about the ability to sell that or what you could potentially do with that? Any timelines around when we could see something happen as it relates to divestitures? I have a follow-up question. Yeah, I mean, you know, obviously we're not gonna comment too much on anything, but we're gonna assess each business, each product family, each geography under the lens of long-term strategic fit, durable growth, and profitability. That's a forward-looking statement. You know, I would say that I wouldn't misrepresent the fact that there's an imminent conversation that's coming, but we are putting on paper and in planning over the next five years, looking at how do we shore up our financial profile through both accretive acquisition and disciplined portfolio management. That's kind of where we are today. Ryan, one thing on business development that I would add is we're thinking about the $300 million that we're gonna need to go for. Simplify is a great example. When we acquired that product, we said at the time that the gross profit or gross margin as a percent of sales was in the 50-ish% range. One of the reasons we had a lot of conviction around moving forward with that acquisition was we knew that it was gonna be accretive to our margin. It was gonna be above our corporate average once we kinda worked our way through the supply chain issues. That's how we kinda look at acquisitions. It's how do we deliver a richer P&L that allows it to deliver on the top and bottom line. Very helpful. Then the follow-up question is for Ryan, is around intelligent surgery. What is the business model? I mean, when we talk about this idea of intelligent surgery, pre-op, post-op, where are you generating specific revenue? Is it on the planning components? Is it on some of this new smart instrumentation? When do we actually see incremental revenue from intelligent surgery? Yeah. A couple different things. Number one, there's a couple different ways to transact data in spine care. You'll get preoperative planning, for example, and there can be software-related subscriptions to platforms like that, or transactional costs related to a team like SMAIO providing surgical plans. As you kind of look at smart instruments and smart implants, there's a lot of value in the data products that can be created, and you can transact them in a similar way, but ultimately you're creating stickiness, right, to a platform like Pulse and integrated with our X360 portfolio that helps us to accelerate growth that we're projecting along the runway. Yeah. I'll just comment on that, you know, I sort of alluded to it. I think the flow of intelligent surgery will go probably in a, you know, three-phase approach. I think out of the gate, as we start to build up our intelligent surgery capability, I think it's a driver of additional share taking and stickiness within a business, so it reduces churn and allows us to accelerate share. Over time, I think it's a catalyst for a more compelling commitment on behalf of our customer. If that happens, I think there's an opportunity to create consolidation in the market. I hope other companies do something similar to actually help all of the spine industry. Then you could get more predictable outcomes for the 577 million patients suffering from back pain. Maybe more of those opt in, and you actually have expansion in the market. I think there'll be a step process that the data and that evolution of data in spine care will take. You know, if we can accelerate share and reduce churn in the short term by novel software applications, develop subscription models that people see value in, then I think those things start leading us to the next phases of how we leverage those types of technologies. Let's take a virtual one real quick, and we'll come back to you. What is the timing for advanced Prone XLIF and Reline One? It's a good question. If we think back to the slides that showed the X360 portfolios, and what's launching and within that was Reline One and advanced Prone XLIF. You can think about those launches occurring over an 18-month period. It's also important to understand that, you know, those are in addition to the already comprehensive solutions that we have within each of those X360 verticals that you'll be able to get hands-on with our product leaders down in the showcase. Let's be fair to this side of the room. Matt? Hi, Mathew Blackman from Stifel. Thank you for taking my questions. A couple for Matt. Just wanna make sure I'm doing the math right here. With the updated cervical disc market and the market share you gave is Simplify at a roughly $30 million run rate. Am I doing that math right? I guess the follow-up would be, as I think about the levers to get the operating margin expansion, where's the heaviest lifting that you need to do? Thanks. Yeah. Thanks for the questions, Matt. What I would say is, you know, we think about cervical in its totality, as Chris mentioned. That 20% growth we posted for the last three quarters, it's been remarkable, and now we're moving into the international space. So, you know, you're in the zone, but we still have another quarter to go. This being said, we're super excited about it. I'd say probably the heaviest lift in driving the margins is probably gonna be around supply chain, right? There's a lot of work that needs to go on there. There's a lot of complexity there that we need to address. You know, the team has done an excellent job for us over the last couple of years, so they're up for the challenge that lies ahead for us. Okay, one from a virtual attendee. Any comments on the third quarter or full year financial guidance? No, we're gonna follow our normal cadence. We'll be doing our earnings call in early November. We'll give you an update as to how the quarter unfolded and our thoughts on the remainder of the year. Then for next year, when Shagun asked the question earlier, I'll go one step further, which is we're likely to give guidance on our normal cadence, which would be early next year. I'll just say that on, you know, for 2023 where we're not giving any guidance, but I think we exhibited the fact that we've likely got strong growth opportunities. We're excited. We'll follow our normal course on talking about 2023, but I don't wanna walk away giving any insight that we're not excited about 2023. We'll follow our formal course in order to give our guidance. Yeah. Hi, Craig Bijou from Bank of America. I wanted to start, Matt, maybe can you give us a little bit of color on how your international margins compare to the U.S. margins? Obviously, as you know, that is supposed to be a bigger growth driver than U.S. Yeah. I would say Europe and Japan. Japan is a very strong growth driver for us. Not only do we have a good strong number two position, but the margin profile there is very strong. Europe is more variable. It depends on the country, and it depends on the business model. From a bottom-line perspective, it contributes, but not to the same degree as Japan. One of the things that excites me, though, about our Latin business and our Asia Pacific businesses is they're low on profitability, but as we grow them significantly in this plan, we're gonna leverage that to drive operating income. I'm really excited to see how that's gonna unfold. Thanks. For Chris or maybe you, Matt, NSO, you guys talked about it a little bit throughout the presentation. Do you mind providing a little bit of perspective on how big that business is? What kind of growth that and, you know, that business will have and how much that contributes to your longer-term plan? Yeah, happy to answer that. When we had some of the challenges in the third quarter of last year, we were asked that question and, you know, on an annualized basis, you can use a base of somewhere between $50 million-$60 million for it. But as you saw in the slide, we do anticipate low- to mid-double-digit growth, similar to what we say around our international business. The nice thing about that business is the stickiness factor is high and the technology is state-of-the-art. There's also, you know, people ask me a lot, "Well, why haven't you talked about it before?" Because it wasn't necessarily material before, but as I look now, the portfolio that we've got that we'll unleash over the next couple of years, plus, you know, the bounce back from some of the issues we faced last year, becomes material for us. It's an exciting little business for us that we believe will have material impact over the next five years. It's also an important component of getting that operating income up. The more successful that team is in driving growth, the stronger we drive our bottom line. All right. Virtual question here. What is the timing for smart implants and what's included or is that included in your 2027 goals? You know, at this time we're not providing any guidance in terms of the timelines for smart implants. You know, what we're talking about instead is the overall vision for intelligent surgery and providing a perspective on what are some of the key foundational elements that we'll be building over the long-range plan to ultimately deliver the value. That's where we are today. Yes. Thank you. Good afternoon, Jeff Johnson from Baird. I guess, Ryan, just following up on that point, you know, with the smart implants, but also with robotics. In the 6%-7% LRP through 2027, would either of those contribute in there, or should we expect that if you get those out, that helps support that 6%-7%, if they come out in 2025, 2026, that provides a little tailwind to that? Just how to think about the contribution that's embedded in the 6%-7% LRP from smart implants and/or robotics. Thanks. Yeah. I mean, if you think about our. You have your core growth, right? That we think has the X360, Pulse, and globalization. We think that upside, that $300 million. That's where we start to say, "We've got to bring that to life through intelligent surgery and aggressive M&A." That's the way you should think about it. All right. Fair enough. Matt, when you were talking about customer mix and surgeon count and what have you, and then being a little more, you know, I don't know what the word was you used, but it sounded to me, do you expect your customer numbers, your surgeon numbers to maybe go down, but then go deeper with those remaining surgeons? Is that how to think about kind of your plan is to maybe tighten up but go deeper with those surgeons over time? Yeah. That's the I use the word density intentionally, which is, you know, are there customers that we're selling $100,000 to where when we look at the cost to accommodate that sale, it just doesn't make economic sense. If you focus on higher value customers where you've got millions dollars in the account, the question is, how could we drive more stickiness with those accounts, drive more volume through there, and get pull through? We're really gonna be targeted in the way in which we go after our customers. I'd say historically, years ago, I think we had an approach of really sales for sale's sake in some respects, and we're trying to get away from that and say to the sales team, "Hey, this customer's only doing $50,000. I'm not sure we wanna be spending our time and resources on that. We wanna have that continued high service touch for the customers that really are helping us drive our economics. Jeff, I'll just say it's just supply and demand. Our generally challenge that we have to overcome logistically in spine is demand at times outpaces supply, not because we don't have enough supply, but it's not run in the right places. How do we manage the supply differently? How do we ensure that we've got the appropriate supply to meet the total demand? Some of that's gonna be how do you migrate it into a more efficient model. That's really what it comes down to. A virtual question here. What are the criteria for you to divest assets in the portfolio that do not fit? Growth, profitability, ROI? Yeah. I think I said this earlier, but it was strategic fit, and it is then durable growth and profitable contribution. I mean, I'm sure there'll be others, but those are things that just pop off the top of my head. It's just so, I'm sorry, I don't know your name. Caitlin Cronin from Canaccord Genuity. Oh, hi, Caitlin. Hi. Could you just elaborate more on the SMAIO partnership and how it's really driven improvements in pre-op planning and how you plan to drive improvements in the pre-op planning and potentially post-op analysis? Are you planning on partnering with other companies to drive innovation and data capabilities? It's a great question. You know, as we look at the SMAIO partnership, there's a couple of key advantages for us. Number one, we get access to one of the world's largest global databases of spine patients, and that data includes the alignment pre-operatively, the surgical plan, the alignment post-operatively, as well as the outcomes, right? Getting access to that, what we have this unique ability to do is, you know, for a particular surgeon and patient, they can then send the diagnostic images to SMAIO, and then they're getting surgical plans, but not just based on alignment correction, but actual outcomes. That, you know, a unique advantage for us. What we're focused on with SMAIO is incorporating all of our implants into that surgical planning platform. There's a second part of that. Second part of your question is, do we plan on doing other partnerships with other companies? Simple answer is yes. We have a significant know-how in innovation in what we sort of say contrary to traditional spine, and like we're doing with the 360 strategies. As I think about intelligent surgery, I know there's companies out there that do things exceptionally well that are looking for a strong partner. We wanna be that partner. We think we're uniquely positioned versus some of the larger companies that have competing interests or conflicting interests at times. I think we're uniquely positioned versus smaller companies where we have scale and capability. The simple answer is, we're looking to accelerate the intelligent surgery strategy, and we'll do that through acquisition, organic opportunity or partnership. I think we're really unique too, in how we're looking at the spine market. Near as I can tell, we don't think the larger players are thinking about this continuum of care that we're talking about. This is a real opportunity for us. I would just highlight, you know, we've got a balance sheet that we can exercise to do this, whereas some of the smaller players, especially in the current economic condition we find ourselves in the world, might be more difficult for them to proceed. We're a good partner because we've got a strong balance sheet. We've got a really nice market share in the market. You can see why these companies would wanna partner with NuVasive. Great. Another question. Can you talk about East Coast Training Center and how that is spurring sales growth over time? I said we're very proud of our industry-leading clinical professional development. It's a commitment, it's a foundational element of what we do and what truly differentiates us in the market is not only our commitment to innovation, but our commitment to education. It's been a natural progression for us to extend that training from San Diego now to the East Coast. I would just say it's a busy site. We've got both the East Coast surgeons attending. I know Alex has been there several times. We've got European teams coming over. We've got Latin American teams coming up. We're very happy with the utilization of the site. Great. Drew? Thanks. Drew Ranieri, Morgan Stanley. Maybe for Matt, but just as we're thinking about your op margin expansion over the plan, can you give us maybe the components of what you're thinking about in terms of gross margin holding kinda steady at 73%? Or do you see any opportunity there to expand margins with some of the manufacturing initiatives? And then kind of with that same question, you mentioned kind of leveraging some R&D. I mean, do you get back down to, like, the 2018, like, pre-2018 types levels of R&D spend? Or should that kind of be maybe 6%? Then I follow up. Yeah, thanks for the question. We wanna go higher than 73%. That's kinda where we've been plus or minus over the last couple of years. With the reduction in stock keeping units, with the conversion of more products into our Ohio facility and in turn, Memphis, we should see productivity there from a margin perspective. The additive to it, which I mentioned earlier, is as we're thinking about the business development that we do, we're gonna wanna drive that margin line even further. With regard to R&D, no, I don't think we're going back to 2018 in our spend. What I really was trying to communicate is it's gonna moderate. You're not gonna see another $20 million increase. If you go back to 2019, you know, it was about $70 million, and we said this year it's gonna be around $90 million. That's kind of the historical frame. You should not expect it to jump to $110 million, despite the fact that Ryan would love that. Got it. Then just in terms of, like, your revenue segments, I think you put out, like, guidance expects low- to mid-single-digit growth over the plan period. I mean, should we kinda take that as a proxy for your U.S. surgical systems and then something else for the actual spine implant business? Just trying to get kind of how you're thinking about the U.S. components there for your revenue growth over the period. Thank you. No, that's. There's a lot in that particular line item, but we're bullish that we'll continue to post positive growth in that segment. We do have other products in there that you know have a different financial profile. You know, getting Pulse growing is gonna help us get those percentages to be sticky and consistent, which is really what I'm looking for out of U.S. Surgical support. Okay. Can you discuss the size and capabilities of the NuVasive sales team and any changes recently? Size. It's been very stable. I think we've got a highly capable sales organization. Again, we're – they're a dedicated crew. I had a chance to have dinner with our two surgeon partners last night. We commented, we spent a lot of time talking about as much as we do in education, as much as we have with innovation, it does take service. You know, our surgeons need strong service and support, and we really lean on our channel and our sales force to deliver that. I'm very proud and very excited to have them as a key part of our organization. Okay. Let's go to the gentleman there. Allen Gong, J.P. Morgan. I just have two quick ones. First one's on Pulse. I believe, correct me if I'm wrong, that currently you are still in a more measured rollout, friends and family. When should we really expect that to move into more of a broad launch to, you know, target more, the total market? Yeah, I mean, we've talked a lot about Pulse, and we've been very deliberate in rolling it out because quite frankly, we're learning as we go. As I've talked about, anytime we put a system in place, it goes with some unit of service, some unit of support. We have been measured. We're accelerating. I wouldn't say we're shifting into fifth gear yet, but we are constantly accelerating the launch little by little. We think it'll open up further next year. We've opened it up to other key markets, including some of the European markets, and that'll continue. I don't know if you have anything else to add. Nothing else to add. I just have a second one on the margins. It's not exactly a fair comparison, but the last target we got from you was, you know, 20%+ in 2024. That was back in 2019. Clearly, a lot has changed since then. You know, it looks like 20%+ is still on the table. We're starting from a lower baseline because of all the macro challenges that you and everyone else in the industry is facing. I guess, like, when we think about the trajectory to get to, you know, 18% versus 21%, what really gets you to, you know, the bottom of the range? What needs to, you know, maybe go wrong? What kind of challenges do you anticipate getting you to the lower end of that range? What needs to go right to get us to 20.1% and, you know, maybe even above that? Yeah. Thanks for the question. We definitely wanted to go with the range for the very specific reason that it's been a challenging macro environmental year this year, and we don't know how long that's gonna continue. Hopefully, things will calm down later this year and into next, but hard to predict. I'd say, you know, the reshaping of the portfolio, the focusing on the density of the customers, the work we need to do in supply chain, all of those will get us to the top end of the range as we execute against them. I think the lower end of the range are more likely things that we don't control. Okay, there's a question, virtual question about Pulse margin profile and how that could change as volume increases over time. Yeah. The more we sell, the better the margin gets, simply. The greater the volume is, the greater the return. Any other questions? Vik? Hi. Thanks. Just on Simplify, Kevin, how should we think about that? Thanks. Yeah. Simplify is a tremendous opportunity for us internationally. We're just getting started. A lot of the effort this year has focused on the U.S. We did have some early sales in Australia and the European markets, but it's very early days. As we complete the full integration into West Carrollton, continue to open up capacity, save for the regulatory environment, which, you know, I think we've got our hands pretty well around, we'll prioritize the markets. Current growth profile is primarily U.S.-based, so we're excited to get into the international market in earnest here over the next year or so. Yeah. With regard to your question on SG&A, you know, we're in the low 50s% in any given quarter. Obviously, it's been a bit exacerbated this year with the freight challenges that we've had. Underneath that, you know, when we went into the pandemic, we pared a fair bit of SG&A out and it stayed out. You know, with the freight challenges we have this year, we also pared even further. That kinda leads me to be very confident that we can take it down. It's kinda like pilot programs that lead me to be very confident that we can take it down. 40% would be a tall order with the service model that we have, so it wouldn't be to that level, but it'll come down over time. Okay. One for Ryan. It's a long one, Ryan, get ready. The data you presented on outcomes suggested an unmet need to do better, but can you give us some perspective on how these outcomes or success rates have improved through the adoption of minimally invasive surgery? Yeah. There is a long answer to that question. The data I showed was, you know, kind of a retrospective look at a large subset of different spine surgeries for different indications. What we see with the move to minimally invasive surgery, and keep in mind that there is still a lot of open surgery that is done today. But minimally invasive, we see generally better perioperative efficiency. We see shorter lengths of stay. Less cost associated with the time spent in the hospital, patients getting back on their feet, returning to normal life, you know, faster and quicker. As you kind of, you know, continue that, you know, generally see pretty favorable outcomes associated with minimally invasive surgery. A lot of what we're doing with enabling technologies, we think about open surgery going to MIS, there's been a loss of visualization. That's where a platform like Pulse really helps to enable to bring the visualization through navigation, all the additional applications, to drive, you know, safer, faster, smarter surgery through MIS. Great. Okay, last question, Ryan. It's all you. It's always gonna be the last question. Feel very honored. Thank you. On Pulse, I just wanna double-check myself for a second. In terms of a business model, you know, you gave out some guidance and kind of where revenue can go on Pulse. How are you thinking about. Is that based on outright sales, Matt? Is that based on some placements, some type of market share agreements? You know, just if you comment on kind of the line of sight you have on the orders that gives you that confidence that you can hit the targets. Thanks. It's basically a blend. It contemplates a model that we say a certain percentage will be sold, a certain percentage will be placed. I'll tell you, early indications are most systems have been sold, not placed. We're probably ahead of our model there. We do have a clear line of sight. We've got a tremendous capital sales group. They've got a healthy pipeline that we've continued to build upon. All things considered, we believe we've got good line of sight to our Pulse pipeline and how that unfolds over time. We're getting better as a capital sales company. We're getting better at it. We're getting more predictive. We're doing that in the face of uncertain situations with customers. Although I hear it from a lot of capital sales companies, we haven't necessarily experienced a lot of pushback yet. We're keeping a keen eye on how the market is dealing. Our provider partners, how they're dealing with CapEx. I think we'll have to continue to keep an eye on that. From our own demand cycle and our capital funnel, we feel pretty good we've got a clean line of sight to our numbers. Great. With that, I would like to thank everyone for your time and attention, and especially Dr. Thomas and Dr. Holman for their insightful comments. For those of you who are here in San Diego, I welcome you to go downstairs. Thank you. Thanks.