Thanks, everyone, for joining us here for the final Fireside of the Day. For those that haven't met yet, my name is Daniel Imbro, the Transports Analyst here at Stephens. Really pleased to wrap up our day joined by RXO from the company, joined by CEO Drew Wilkerson and Chief Strategy Officer Jared Weisfeld. Gentlemen, thanks for joining us. Thanks for having us. This will be a Fireside chat kind of format of a discussion, so I'll kick off with Q&A, but please ask questions as we go, and I want it to be a good use of everyone's time here in the room, but Drew, you know, plenty to talk about with RXO specifically and a lot of things going on at the company right now, but we'd love to start maybe at a high level just on the market and how you see it shaping up. You know, it's been, I would say, bouncing on the bottom for a long time here, but maybe some tightness in the last 30, 60 days we've heard about, a little chatter even today at these meetings of market tightening. So how do you see the market shaping up right now into year-end? How do you see peak season shaping up right now? Yeah, so we're still on a soft freight market overall. But if you're looking for some green shoots, tender rejections are sitting at around 6% right now, which is a year-to-date high from where we're at. They're still not at the level of where you typically see spot loads come in. Typically, that's high single digits, low double digits. But it's a whole lot better than whenever it was at 0%. I guess, what do you think is driving that? Because we've seen capacity slowly leaving the market, but it isn't like we've seen a big pickup in capacity exits. So when you either talk to your shippers or when you look at the market, what do you think is maybe driving that uptick into peak? Yeah, so I think, well, one, whenever you look at where capacity is, there's still too much capacity for the amount of demand that's out there. And when you look at why there is too much capacity, from 2020, 2021, and parts of 2022, you had rates at an all-time high. You had government that gave out PPP loans that helped expand the balance sheet of these companies. And then if you look at the banks right now, they're not in a hurry to be able to go in repossession of trucks at this point in the cycle because they have nobody to sell them to. And then the last thing that I would say is if you look at jobs, typically whenever drivers leave the industry, they go into something as an industrial manufacturing or construction, and that job market hasn't been strong recently. There's not a place for them to go right now. When you look at where we're at from a demand side, we're down from where we were from 2021 and 2022. If you look at where we sit overall demand and retail and e-commerce customers, supply chains actually sit in a pretty good position for where we're at. If there is a peak season, we're in a good position to be able to handle it. I think we said on our earnings call that we were not expecting a strong peak season, and that's partly because of what we're hearing from our customers. Typically, whenever we have strong peak seasons, that is whenever you see spot loads start to kick in. Got it. So we're not quite there yet, but we're watching at least an improving backdrop, is how you characterize it. That's right. Great, and maybe from an RXO-specific standpoint, pretty transformational year with the acquisition of Coyote. We got plenty of numbers to talk about. But from a strategy standpoint, why didn't Coyote make sense? Why was that the right target as you wanted to add scale out there? There's plenty of brokers out there you could have bought. Why is that the right one? Yeah, so I would say adding scale, but adding scale at this point in the cycle was really important to us. And to be able to have the opportunity to deleverage our balance sheet to where if you look right now, we're 1.6 times levered. So where our balance sheet is at is in a very strong position. We did due diligence on Coyote just as we would with any M&A. And whenever you look at customer and carrier overlap, there was very little customer or carrier overlap. From a customer standpoint, 40% of Coyote's business is small to mid-sized business. For legacy RXO, we built the business on enterprise customers. When you look at what did make up Coyote's legacy enterprise customers, it was largely in food and beverage and in transportation-type customers. Legacy RXO was in retail and e-commerce, industrial manufacturing, and automotive. So there wasn't a lot of overlap. On the carrier side, we built the business off of working with smaller carriers, think one to 15 trucks. Legacy Coyote was working with larger carriers and private fleets, something that we had always wanted to do, but we had never been able to break through to private fleets, largely because I think Coyote and C.H. Robinson had a good stranglehold of being able to work with private fleets, of being able, they were early adopters within that market. And then the last thing that I would say is just a cultural fit. The way that we looked at business was similar to how they looked at business. When you think of what's important to RXO service, making sure that we're giving customers good customer service on every single load, going out there and creating solutions for customers, of giving them data off of our platform to tell them how they can make the best decision. Can you combine multiple LTLs to make one truckload at a multi-stop shipment, or vice versa, looking at what day of the week they should be able to ship something? And then the third thing that I would highlight is the technology. We have spent a lot of money on technology to give us a competitive advantage with customers, with carriers, and employees. And right now, our technology is second to none within the industry. And being able to do tech stacks with an M&A has been a lot of fun for us to be able to do from that perspective. And then the last thing that I would say is relationships with customers are extremely important to both organizations. If you think about legacy RXO, our top 10 customers have been with us for over 15 years on average. Legacy Coyote was in a similar number. It wasn't quite at the same number, but a very similar number. And so as I think about the new customer mix and the new technology, does that manifest ultimately to stronger load growth over time? Do you think you get more wallet share with existing? How does that actually manifest into the financial other than just the accretion of A plus B equals C? What else are the synergies on a top-line standpoint? We'll get to cost in a bit. Yeah, so if you look at the top-line standpoint, I would highlight two things. First, from a cross-sell initiative. Early on, while we're not on one platform, in the first six weeks, we saw over 200 cross-sell opportunities from legacy Coyote selling legacy RXO services that they would not have sold before. So think cross-border freight, cross-docking, some managed transportation business, even within the last-mile side. So there was a lot of cross-sell opportunities. And we do think that that will lead to a stronger growth algorithm. At legacy RXO, if you look at how we started the business from 2013 through 2021, we grew at over a 27% CAGR during that time period. The market, the brokerage industry, grew at just over a 9% CAGR. So we're growing three times what the brokerage industry was growing. If you go on and you go into 2022 and 2023, we showed strong growth in what was a market that started to fall down. This year, we talked openly about having a pricing strategy to prepare for a market inflection if and when that should come, and so we knew we would take a step back on volume this year to prepare for the longer term, but if you look at the amount of capacity that we've got right now, we're definitely in a stronger position to have a great growth algorithm going forward. Can we just unpack that approach to bid season a little bit more? Because you guys have talked directionally about it. I think to unpack it, you guys were holding the line on price and willing to go at more volume growth ahead of the cycle turn. I don't want to put words in your mouth. That's how the market's anticipated that. If we stay in this softer freight backdrop until next year, how do you manage through a bid season again where we've lapped over easier growth, but we're not seeing the catalyst to your point where the market's actually giving you spot loads? How do you find that balance to actually grow profitably when you have neither on that side? I would say last year we didn't give our pricing strategy until bid season was done, and we're just starting bid season. I don't want to forecast out exactly what our pricing strategy is for this, but I would say that we understand exactly where we are in the cycle, and we've got a strategy as a combined organization. We're not just looking at it as legacy RXO, legacy Coyote. We're looking at one company of how we position ourselves to best serve the customers. Makes sense. And if I think about the cost side, you guys have identified, was it $40 million, I think, in cost synergies roughly for the combined asset right now. You took that up last quarter. Can you break out a little bit detail where those are coming from and where you maybe see the earliest capture opportunity and where it might be later dated to realize that, Jared? Sure. So the initial estimate was at least $25 million of cost synergies, which to your point, we increased to at least $40 million when we released earnings a few weeks ago. So integration is going smoothly ahead of plan. And when we think about the buckets of synergies, it's pretty holistic in nature. So think about across technology, think about across back office, think about duplicative roles, duplicative vendors. So as we look to go ahead and execute on the synergy opportunity, it really is holistic in nature. So that $15 million of incremental synergies that we talked about during earnings, that we really tied to the technology platform integration. So Coyote operated Bazooka, which was their historical transportation management system, TMS. We operate RXO Connect, and within that is Freight Optimizer, which is our equivalent. It's RXO Connect and Freight Optimizer, really, to Drew's earlier point, we think it's the best that's out there. We've invested hundreds of millions of dollars developing this proprietary platform, but we went into this eyes wide open in terms of the acquisition and really think about it as a bake-off internally, right? Best features of both, what is going to be the platform of choice, so we standardize across RXO Connect, but with that said, we are going to take some of the features and functionality associated with the legacy platform from Bazooka, especially around the carrier side, around the pricing side, and when we go ahead and implement the one strategy across both technology platforms, we talked about having that substantially done within 12 months, so think about September timeframe next year. That's when you're going to start to see the real synergies on the cost side. And then that is incremental to that would be the $40 million. So we talked about on the call. Think about the cost of purchased transportation as a synergy bucket, the combined pool, $4 billion of purchased transportation spend. And I think Jamie, our CFO, talked about this on the call. If we were to just spend 1% better, think about $40 million of potential synergies on cost of purchased transportation just to start. Yeah, so that's the question. I think there was a question over there. Please. Thank you for coming back. Thank you. A quick question. Do you see this industry getting more consolidated? I mean, obviously, it's a bit more top-end with you guys, but historically, it's been a super fragmented industry. So we'd love to know kind of your thoughts on that. And two, what about upstart tech competitors that have come in and exited over time? And maybe just your thoughts on that as well. If we get into a better market, are we going to see those guys be coming? Yeah, so I would say it is a large fragmented industry. There's over 17,000 brokers out there. But if you look today, the top nine post-acquisition of Coyote make up roughly 50% of the overall brokerage market. I think what you'll see is large, financially stable carriers who have strong balance sheets, who have good relationships with their customers, have technology that's integrated with customers and carriers. Those are going to be the winners. And I think when you do look at it, there will be some consolidation at the top. And as we go out three or four years, it could very well look like your top four or five make up more than 50% of the overall brokerage industry. And the second part of your question on industry disruptors, I think there's always been industry disruptors and new entrants. We never saw anything differentiated on the technology side. We did see some folks who came in and tried to differentiate on price, but for us, that's never been in our DNA or in our model. To me, if you get let in on price, you will get thrown out on price. And the second thing I'd say is you actually have to service the business you get. So when you talk about that, we do business with roughly half of the Fortune 500 companies out there, you only get one shot at doing business with them. And so to be able to go out there and say, "Hey, I can take 100 loads a day, 200 loads a day," the first time you fall down for that, you create an opportunity for somebody else. I think we'll follow up on that topic a little bit. I think historically, a knock on the brokerage industry was just a low-barrier to entry, low moat for a new broker to try to start up. Hard to be good, but you can at least start one. I guess as you look forward three to five years and technology becomes more table stakes, does that increase the moat around the business finally to where there's better pricing power? I'm trying to think how does that over three to five years affect the overall profitability of the industry? And do you think the industry stays rational and actually lets that flow through? Or do people start competing that way on price? And how does that play out? I mean, our top competitors, we don't see anybody right now trying to differentiate on price. It is strong operators who run good operations. Could they in the future? I can't speak to what their strategies will be. It's something that we would watch closely. Our strategy will always be to go in roughly in line with what is going on within the market and work to build a carrier base to where we can have strong margins. I think as you continue to invest in technology, you may not see a shift on the gross margin percentage in the overall business, but you should start to see the EBITDA percentage go up in the industry because your productivity will increase. One of the things that we highlighted is even at the bottom of the cycle, on a trailing 12 months, our productivity on legacy RXO was up roughly 15%. To your point, Daniel, I mean, the three of us, we can go start a brokerage tomorrow, right? We're not going to get very far because we're going to have a difficult ability to scale, right? You think about the benefits of scale, which to Drew's earlier point, really was part of the investment thesis associated with Coyote. I mean, combined, we have 150,000 carriers, right? If the three of us were to start a brokerage, maybe we'd have half a dozen, maybe we'd have a couple of customers, and we'd get squeezed on both sides, right? So to the earlier question and Drew's point on consolidation within the industry, top nine players now represent about 50% of the market. When we think about the ability to continue to invest across cycles, the ability to service customers and get closer to our customers across the cycle and build out those differentiated solutions, we strongly believe that the moats to becoming a scaled broker and a top broker are going to get stronger over time. Can we dig in a little bit there on what drove that productivity? Some of the other brokers in the public market have been talking a lot about investing in automation, technology, and that's driving their productivity. 15% is nothing to sneeze at, but I'm curious, how are you driving that? What room is left to drive that further before the Coyote integration as you think about productivity and self-help there? And is it technology-driven? Is it training? What are you guys doing to do that? It is largely technology-driven, and it's a very simple approach. We focus on the number of keystrokes and the number of clicks and how do we reduce that so that our reps can spend their time focusing on customers and solutions for customers and building the relationships with customers versus mundane tasks. I think about whenever I started in the brokerage industry, it took me several minutes to build an order. Today, our reps are doing it in a second. So overall, there is a lot of opportunity for us to increase. I think about where productivity has come from and where our top reps are. We still have a long way to go in increasing productivity over time, and that will largely be driven by what happens on the technology and with automation, not just for us, but I think in the industry. Got it. And as you think about building those automation tools, then in-house thing you build, is that third-party off-the-shelf kind of technology you would license? And then curious, as you think about incentivizing the salesforce and that, what are the KPIs you're paying them for? Obviously, people do what you incentivize them for. Has their roles changed? How did their incentive comp change to align them with the company? Yeah. So I would say if you look at the second part of what you said on the incentives, we really look at what is important to the company and for them, something that you can break down and understand. And so the way that we always say is we want a compensation plan that you can go home and you can explain to your kids how you get paid and they understand it. So for us, we're focusing on gross margin per day. And there's a couple of ways that you can get there. You can get there in gross profit per load, and you can get there in volume. And so we've got a sliding scale, and we measure that out over time. The other thing that I'd say is we saw this as an opportunity post-acquisition that we've got a chance to be able to put Coyote on some similar plans to what we are, and we think that'll drive stronger growth if we incentivize them off of those two things, if you look at where your gross profit per load is and where your overall volume is trending. On the first part of your question in terms of the tools that we're building with respect to productivity, those are homegrown on the brokerage side. That is RXO proprietary technology. As we think about the first couple of quarters this year, we're up 18%, about 15% this quarter in terms of LTM productivity. I mean, you think about the investments that we've made in technology. It's not just when we think about the investments in tech, right? Three main cohorts are people, our customers, and our carriers, how they all interact together. I think about the investments that we've made, whether it's productivity enhancements, whether it's artificial intelligence, machine learning for our pricing algorithms, that is no doubt proprietary to RXO. Maybe stepping back a little bit. So cycle's tightening a bit. We have an election two weeks ago, and who knows what that means for growth? It does feel like there's an optimism that we haven't felt in a while around the freight space here this week. Curious, as you're looking at policy or proposed policy, what do you view as potential tailwinds, potential risks? How do you think about just what's out there right now and how that could impact RXO in the next year? I think to your point, there's a lot of optimism out there, certainly a lot of optimism in the equity markets as well. Let's see. He's obviously still in the process of putting together his cabinet. So let's see what ultimately the cabinet looks like, and let's see what the policies look like relative to expectations. But I would certainly say that there is optimism on deregulation and what that means for potential investments with respect to, I mean, look at over the last five, six months, right, with respect to the industrial PMI sitting at basically new lows. So will businesses be inspired to go ahead and spend a little bit more? We'll see what happens in terms of depreciation policy on bonus depreciation. We'll look at what happens with respect to potential tax cuts. So I think there's a lot of optimism. I think we want to see how that translates, but it's certainly in the near term translating into consumer confidence, consumer confidence sitting on seven-month highs, consumer confidence for big and bulky durable goods sitting on four-month highs, so I think we want to see what policies actually get implemented, but certainly there's optimism out there. When you mentioned the regulatory hurdles, are there certain regulatory hurdles that could be used to make your business easier, or is that just a broader industrial comment that you're hearing from some of your customers? That was more of the latter in terms of just an environment that is maybe more business-friendly in terms of deregulation. I think the one thing that we certainly, it's still too early to tell are the potential impacts associated with any tariffs that get implemented, right? So I think that in the near term, could that cause supply disruptions and volatility that could be? I think we want to balance that with respect to the long-term implication associated with what that means for inflation. Got it. Helpful. Well, maybe going back to how we see the market shaping up here in 4Q, I think last quarter you talked about project activity, starting to see that in legacy Coyote business. It's been a while since we've heard about project activity. I'm curious if you could add any more color around where you're seeing that, what kind of business that is, if there's a certain end market that's having more of that right now, and what is driving that? So we saw it in two places. In the legacy RXO business, we saw it in retail and e-commerce that there were some projects that came up. And we've told you for a long time that while we are in a very loose market, whenever there are spot loads projects in mini-bids, we would be the customer's first call. And so we saw that take place with some retail and e-commerce customers. The second place that we saw it was in disaster relief loads. And so when you think about Hurricanes Helene and Milton, there were a lot of customers that depended on us getting critical loads down into Florida, down into Western North Carolina. And so from that perspective, we did say that we did not expect to see that continue into November and December, but it was nice to see that as they came up, we were the first call. We also saw that as an opportunity within legacy Coyote's business. They did not see the same spot loads and projects come up, and for us, while that put some constraint and some margin pressure on them on gross profit per load during the month of October, we're very bullish on what that means for the long term of the business because as they have these great relationships and you start to capitalize and be the customer's choice on spot loads projects in mini-bids, we think there's a lot of opportunity for an upside and a synergy that we weren't really planning on going into the acquisition. When you talk about project activity with the hurricane, is that largely behind us at this point? Is that still ongoing here into November with the recovery effort? There was very little of it ongoing. There was a little bit early in November and a slowdown. And how do you guys think about with truckload rates going up now, just managing that mix? I think you're almost 70% contractual now. So on some level, that's the gross margin squeeze you talked about here in the fourth quarter. How do you think about balancing that contractual mix into next year if we do get into maybe a slower but continued upcycle in rate? Slower but continued upcycle would put a strain on gross profit per load because our contract business would get squeezed. Once we made it to the other side and we saw the spot loads, exactly what I talked about in October for legacy Coyote, you would see the spot loads and the projects gross profit per load more than offset what was happening in the contractual side. So if it was a slow recovery, then it would cause a squeeze on the business. If it was a V-shaped recovery, you may not even see the squeeze that happens within the business. I won't get there yet, but hopefully we'll get there. We don't know. That's helpful, though. And if I think about maybe looking back at 3Q and on the growth side, there was a lot of disruption in the broader freight market in 3Q. At the port strikes, you had some issues around the country. Truckload volume was a bit more muted, I think, than even you guys thought. You guys mentioned bid season, but it was a little more muted than you thought it would play out. Can you maybe, with the benefit of hindsight, look back? What are the challenges on volume growth today? Kind of where were the relative points of weakness you didn't expect? In Q3, I would say the volume expectations were largely in line. If you look at on the core legacy RXO, we were down about 9% year over year, actually towards the high end of our expectations. LTL, we talked about growing 13% year over year last quarter for legacy RXO versus the 10%-20% outlook. And you look at full truckload, which came in at down 9% relative to down high- to low-double-digits with total coming in down 5%. So relatively in line. But when I think about the, I think, a couple of things. One, building on Drew's earlier point, we priced our book of business accordingly with a particular strategy. So I think those were the general results that we had expected in line with that pricing strategy. But you think about the challenges that overall freight demand has had over the last couple of years, right? This has been the longest freight recession on record, and it's been unique from a few different aspects. I think most notably, it's decoupled from the macro where the macro has been reasonably healthy with positive GDP growth and what apparently looks to be like a soft landing, but we're in a freight recession, right? So why is that? And I think part of that is supply, like we've talked about, but part of that's demand where even though the macro is reasonably healthy and the consumers are stronger than I think most economists would have thought two years ago, they're just mix-shifting towards services versus goods, right? So if you look at the composition of consumer spend across services and goods via PCE, we're on multi-year lows on goods versus services. And a lot of that makes sense also because we're all locked in our homes during COVID and we were buying way too many televisions for the home and we overstocked, right? So I think you have that reversion to the mean going on, but services inflation right now is persistently high. So encouragingly, talk about the green shoots from earlier, we've been bouncing along the bottom as goods as a percentage of the mix, but you're starting to see goods increase a little bit. And I think that will, I think that goes in line with some of the consumer confidence and intentions that I talked about earlier. And the other thing adding on to this, retail inventory positions on behalf of the largest retailers in North America are the cleanest they've been in the last two years with inventory growth less than that of revenue growth. So it does set up well for a potential restocking event. And if I think just to go back to volumes real quickly, just to make sure we put a bow on that. So it sounds like this was in line with your expectations given the strategy on how you went to bid, but I do think gross margins sequentially stepped down, which I would have thought if it was protecting price at the expense of volume, we would have seen less maybe sequential gross margin pressure. So maybe what were the other offsets that caused that gross margin pressure? Because you grow in LTL, that's accretive. You priced and gave up volume. That should be accretive. So what were the bad guys that helped offset that on the gross margin side within that framework? Sure. So the gross margin outlook for legacy RXO in Q3 actually came right in line or roughly in line with our expectations at the midpoint of our outlook, right? So when you look at, but to your point, and I think this speaks to why we believe we're at the bottom of the cycle, we have a limited ability to bring down cost of purchased transportation when you think about the current unit economics of the carrier, right? Spot rates right now ex fuel are probably about $1.55, closer to $1.60 with fuel over the last few weeks, but that's 20-30 cents below the carrier cost. So you think about the ability to bring down cost of purchased transportation in the context of the current environment. I think that sort of played in line, played out pretty much in line, roughly at the midpoint of our outlook on gross margin in Q3. Got it. Okay. That's helpful. On the flip side, LTL has been a nice growth opportunity. You guys have leaned into that market. Can you maybe talk operationally? What has it taken to either incentivize the team to do that, or what are the new tools you've had to stand out to really start growing into that market and begin to take share there? I'd say one, looking at legacy Coyote's LTL business and looking at legacy RXO's, they're similar size, but it was very different approaches in how we got there. At legacy RXO, we got it from large customers who we had really good relationships with, who we had created strong service, and they looked at it and they said, "LTL is a small piece of our overall transportation spend, but it's a big piece of where we spend our time, whether it's on claims, whether it's on lost shipments, whatever it could be. We could focus our time on truckload and look to bring that down. And if you brought that down, then LTL becomes less of a headache." So for ours, it came from large customers who like the platform to be able to do it. For Coyote, it came from small to mid-sized business, and it was largely driven by transactional small to mid-sized business. So as we go forward, we think there's a great opportunity to grow both of those. We've already seen some early interest from legacy Coyote large customers talking about LTL and what that could look like on our platform. And as we continue to build out and invest into the SMB model, we should grow that as well. I do feel like talking to brokers, LTL has historically just been harder to do well. It's a lot of much smaller profit per load type loads. You need a lot of volume. I guess from a technology standpoint, was that something Coyote's technology on Bazooka was better at doing that you could bring in or their best specific practices for things that they had built like that that you can integrate into your own platform as you look forward? Not as much on the LTL side. A lot of what we saw where legacy Coyote's Bazooka was ahead of where we were was carrier RFPs. So if you think of how they built the business with large carriers, private fleets, running carrier RFPs and waterfall routing guides, it's something that they did really, really well. There were some tools on the carrier rep side, which allowed them to create efficiency that will make sure that come over, and their pricing workbench overall was a little bit ahead of where legacy RXO's were, so those are the three biggest tools that'll make the leap over. It won't necessarily be from the LTL side. That's great. And then LTL demand, I'd say broadly remains tepid. We've talked with a number of them today. I don't think anyone sounds super excited, but how do you assess the underlying market there from your purview looking out, not being carrier specific? So if you look at it right now, it's roughly 20% of our overall volume. Some of our largest competitors is upwards of 50%. And so that should be at a higher gross margin percentage of what that business runs at. And while you're right, it is at a lower gross profit per load, because it is so highly automated, the EBITDA percentage is actually higher than what the truckload EBITDA percentage is. So for us, the way that we look at is you have to prepare yourself for the inflection, but you also have to prepare for the next downturn. And two areas that we've done that have been LTL because it's a stable gross profit per load, as well as managed transportation. And we talked on the call about in the fourth quarter, onboarding $400 million of freight into our managed transportation of freight under management. So for us, as we do that, that doesn't just set us up well for the next upcycle. It sets us up for whenever this is a cyclical business. We understand that. When the cycle comes back down, it gives us a higher base there. Yeah. Maybe let's talk about managed transportation because it's something that doesn't get talked about enough, I think, the magnitude of the wins you guys have had. What's driving those? Where is the business coming from as you go out there and win that business? Where should we think about where was that business before RXO won it? How long does it take to integrate it and then think about the flow through to the actual P&L? So I'll start talking about where the business comes from, and then I'll let Jared expand on where the business is actually hitting into the P&L. But if you think of where the business is coming from, it starts with legacy customers, customers who know us, that we've talked about building relationships with, that we've got service, and they understand the team of engineers that we've got behind managed transportation is robust and that potentially we should be able to purchased transportation stronger than what they can. When you look at a combined organization, now we've got roughly $10 billion of freight under management. So we should be able to do that really well. They like the technology platform. It creates a benefit for them within their business. The second place is from competitors in the industry. Typically, these contracts are three to five years whenever you're talking to potential managed transportation customers. We know who the market is and we know when those contracts are up. So you can believe that 18 months, 24 months before they come out, we're out having conversations on giving them the benefits of why it should be RXO. Then on the financial aspect, to Drew's earlier point, right, you think about building that stable base of EBITDA across the organization. Roughly speaking, for every $100 million of freight under management that we onboard, there's probably about a 1%-2% yield in terms of that flow through from FUM down to EBITDA. So adding that EBITDA or adding that freight under management to the funnel is so important not only for increasing the base of managed transportation, but we also talk about synergy loads internally and externally as it relates to how to think about managed transportation becoming a customer to our brokerage business internally, right? Because in many cases, Daniel, we're getting feedback from customers where they want access to dedicated RXO brokerage capacity. So they get that via the managed transportation business, and then RXO brokerage has to win it, right? They have to be there on price. They have to be there on service. And then you think about the ability to go ahead and accelerate RXO's organic volume growth within brokerage because of that added freight under management. I think that opportunity is really critical long term. And then one of the other benefits associated with Coyote, you think about their large enterprise base within their core brokerage business. They had a small managed transportation business, but it really wasn't of scale. So how do we think about cross-selling, and it'll take time, right? 12-18-month type sales cycles. How do we cross-sell our managed transportation solution business into their customer base? And in many cases, we're talking about a very different customer set, right? Food and beverage, transportation. So the ability to diversify our freight under management as well. I think there's a really strategic benefit there as well. The cross-selling is really interesting. Have you all ever shared or what is the percentage of customers maybe uses you for both? Like uses you for managed trans and then also uses actual legacy RXO brokerage. And what is the cross-sell opportunity? Trying to size up what that could be like across the customer base. We haven't ever put that number out there, but what I'll tell you is that customers are telling us to use ourselves where they see that we add value on service and we come in line with what's going on at price. They like the ability of if somebody falls off the load, then they can look at managed transportation and say, "Use your brokerage to recover this load and do it fast." So for us, we think it's a significant opportunity. It's one that we've grown over the last several years, and we think we've still got an opportunity to grow it, and with every new piece of business that comes on, it gives us the opportunity to drive more organic growth into brokerage. That's helpful. Maybe the other piece is just final mile, kind of last mile business. You guys have continued to grow that through this down cycle as well. I think stops are up 11% last quarter. I guess how do you get the long-term growth opportunity there? What are the actual differentiations that you guys have to win sustainably profitable business in that? One, we've got scale. We're the largest player in the space. We have been for a long time when it comes to big and bulky goods. So if you have a customer that has a national footprint, they start the conversation with us because we understand the business extremely well. The one thing that I'll tell you is when it comes to brand protection, it is extremely important that you service last mile well. It puts us in the C-suite faster than any of our other lines of business. Because if something gets screwed up, you better believe that they're going to tweet or they're going to email to the CEO of that company and say, "This got messed up. My floor's got scratched. Delivery was 20 minutes late. Delivery was an hour late." And so for us, that brand protection is very important. And so customers like the service. They like the scale that we're able to offer. The second thing I'd say is we have a last mile hub network right now that is set up within roughly 120 miles of roughly 90% of the U.S. population. So that's a network that nobody else has set up to my knowledge and is something that allows us to service the customers at scale into remote areas as well. It feels like we've seen a few other public scaled players leaning into this last three to five years. I guess over time, does that whittle away at margin? How do you think about the long-term profitability of last mile? It used to be very hard to do. Few people did it. Therefore, more profitable. As more people come into it, what does that mean longer term for last mile or last mile kind of margin productivity? I think we've got opportunity to improve the last mile margins as a whole. So I'd point to one thing. Whenever you look at space optimization within our last mile hubs, we still have an opportunity to become more efficient. We talked about purchased transportation on our last earnings call within last mile. We think we've got an opportunity to be able to bring that down. And the more scale you drive into that business, the stronger the contribution margin becomes. So for us, we think we've actually got an opportunity to expand margins over the next 12-18 months. That's super helpful. Maybe following up a little bit more on the near term is the cost and financial outlook here. Maybe Jared, just thinking about the state of headcount. We talked earlier about productivity. Continuing to have opportunities to drive that. I guess how do you think about what the right level of cost inflation is for the pro forma business? I mean, 4Q will be up a lot. You'll be able to think about a sequential move from there into next year. Without guiding for next year, what is the right level of growth as you see the business? So when you think about from a headcount standpoint, right, so we think that the true value of this business, right, is our people, our technology. It's the combination of both, right? So we talked about earlier this year how we had an increase in merit, right? How we took care of our people despite it being a tough rate cycle. So you think about the natural source of inflation, which had been moderating but still persistent, combined with merit increases. Obviously, we have a tailwind into 2025 with respect to the realization of the synergy target that we talked about, where we communicated that we expect the first $25 million to have an action from a synergy perspective between closing and 12 months from closing, with that additional $15 million occurring in Q4 of next year tied to the technology. So when we think about headcount, the reality is when we look at the business, I think it's cost inflation plus merit, and then you've got the offset on the synergy side. And that synergy number, right, it's very comprehensive, right? It includes duplicative vendors. It includes the ability to go ahead and just drive those efficiencies. And that is also, as we talked about earlier, excluding the cost of purchased transportation synergy. So I think we're staffed for growth. We've got the ability to go ahead and handle probably about 15% volume growth above where we are right now. And I think importantly, when we think about sources of synergies, I mean, you'll notice a consistent theme. We're not talking about sales as a source of synergy, right? I think we want to make sure that we are getting close to our customers, especially at this part of the down cycle, and the ability to go ahead and invest in sales across all the different verticals from a customer segmentation standpoint, SMB, middle market, large scale enterprise. There's a significant opportunity ahead. Then continuing from the near-term kind of number side, the decline in revenue per load has been improving for the last four, five quarters. As you're seeing the market tighten, maybe gross margin gets squeezed in 4Q, but do you expect to see that actually flip the growth finally here again in 4Q, early 1Q as we see revenue per load? Yes. So we didn't give an outlook on Q4 revenue per load, but to your point, I mean, this was the, I think, fifth consecutive quarter of easing in terms of that year-on-year revenue per load decline, which gives us certainly informs our view when we think about us being at the bottom of the cycle. So we've seen some pretty significant improvements on revenue per load. And that's both at legacy RXO and at legacy Coyote. And we talked about, I think this was in the month of June, we talked about full truckload legacy RXO revenue per load going positive. So I think from where we are right now to that number going meaningfully positive will be a function of the rate of the recovery, right? So, what happens in the market and to the extent the recovery is strong, you'll start to see the spot loads that come into the market, which obviously be positive from a revenue per load perspective. Makes sense. And then for the gross margin, I think you guys got a 4Q down a little bit sequentially at the midpoint on just legacy brokerage, just given the compression in margins we're seeing. How do you guys think about just managing the cash balance here? Because you guys have a decent amount of cash in at 3Q, but I think you noted it was mostly accounted for with some cost coming up in transaction. So how do you guys think about the working capital draw and how the balance sheet flexibility if gross margin got squeezed here into a peak season here? Sure. So first of all, the liquidity position of the company is the strongest in the company's history. We have $600 million revolver, which at the end of Q3 was completely undrawn, and you think about, to your point, we had $55 million cash balance at the end of Q3, but most of that has been already spoken for as a combination of timing with respect to transaction fees associated with the deal and some of the restructuring that we're going to have here in Q4, so the beauty of this model is the strong return on invested capital over time, because if you think about the cash requirements of this business, they're actually quite low, right? Because we've got $40-$50 million legacy RXO capital expenditures in 2024. Layer on Coyote, which we talked about roughly between $15 and $20 million pre-synergy. Then you layer on our interest expense, which remains unchanged at about $32 million, given that the transaction was successfully financed via equity, given the strong demand from our investor base. So that gets you to roughly $100-$110 million or so of fixed costs, if you will, from a fixed charge standpoint, right? So anything above that level of EBITDA really will drop down to the balance sheet in terms of cash at $0.75 on the dollar, with the delta therefore just being your effective tax rate, which long term for RXO is about 25%. So whether or not we're doing $250 million of EBITDA or $600 million of EBITDA, those fixed charges don't really change, right? Which ultimately is the strong free cash flow characteristics of the business. To your point, depending on where we are in the cycle, you can certainly have different working capital characterizations. When we grow, you will have a one-time use of working capital for every dollar of incremental revenue. It'll be about a $0.07-$0.09 consumption of working capital. Conversely, when the cycle is weakening, which you saw in first half 2022, that reverses balance sheet shrinks and it becomes an inflow of cash. Makes sense. Then on the transaction costs, I think the initial expectation was maybe $15 million, if memory serves me right, on what the expected kind of integration cost would be. I do think you guys got it a little bit higher than that in 4Q already. Just how's the integration going well, but I guess are there more costs than we thought or kind of what's not going according to the initial plan there? I'd say a couple of things. The Q4 outlook that we provided includes the restructuring charges associated with Coyote. The prior assumptions for 2024 were pre-Coyote. Keep that in perspective. When you think about the cash required to achieve the $40 million of synergies, it'll be roughly about $25 million. I think one-time cash, as you think about, that'll be a strong return on that spend. Those are the initial cash requirements to achieve the $40 million, at least $40 million of synergies. Got it, well, and maybe Drew, as we just kind of wrap up here, getting towards the end of the time, I don't see any more questions in the audience. We've talked a lot about Coyote and kind of the integration here, but I guess what has you and the team kind of most excited leading into next year? You have the scale under you. What do you guys see as the biggest opportunity from here? Yeah, so I would say purchased transportation is far and away the largest synergy that we see. And we talked about how purchased transportation could exceed the $40 million of total synergies that we put out to be at least $40 million. So when you look at purchased transportation, I said earlier, when you look at due diligence, there were lanes that Coyote bought significantly better than legacy RXO, and there were lanes that legacy RXO bought significantly better than legacy Coyote. And like an anecdotal win is this week in purchased transportation, and it all had to be done manually because we're not on one system. But legacy Coyote had a lane that was running from Pennsylvania to New York. We saw that legacy RXO was buying significantly better. Legacy Coyote called the carrier and said, "Hey, we have other carriers who can haul this load starting today. You need to drop your rates." And so the carrier pulled the rates down. And just on that one lane that doesn't have a lot of volume, it's an annualized $60,000 saving for us. So to be able to repeat that more and more and more is something that we think is a great opportunity. And like we said, Jamie talked about just being able to improve it 1%. Imagine if we're able to improve it more than that. I appreciate the time, you guys being here, and best of luck. Absolutely. Thank you for having us. Thank you.