Okay, there we go. Yes, good morning, and I think we can kick off. Welcome to Sprouts' fireside chat presentation today. Thank you for joining us. My name is Krisztina Katai. I'm Deutsche Bank's U.S. Retail Analyst. It is my pleasure to have with us Sprouts Farmers Market Management team. We have Jack Sinclair, who's our Chief Executive Officer, and also Curtis Valentine, Chief Financial Officer. For those that might not know, Sprouts is one of the largest natural organic grocers in the United States. They're getting close to operating 500 stores, growing close to a 10% clip. With that, I think we can kick it off. Jack, I wanted to start with you. Obviously, Sprouts has had an impressive run of same-store sales. You've expanded your profitability. You had really strong performance, including in your most recent first-quarter period. For those that are not as familiar with the Sprouts story, maybe if you could describe what differentiates Sprouts from the competition and what you think really has been a critical element to your overall success. Yes, Krisztina, thanks for that. The very key part of our business and why we've been really, I think, creating some success over the last few years has been very focused on our target customer. We've been very intentional that we would focus on five years ago when we put the strategy together, there was a $200 billion market in what we described as Health Enthusiasts and Innovation Seeker. That is $200 billion of a $1.2 trillion marketplace. Focusing in on $200 billion meant we had to not focus on $1 trillion of business. One of the things that's been successful for us is shaping the business behind that target customer, increasingly trying to understand that target customer better and better. Our merchandising team has been focused on attribute-based products that really do resonate with that target customer. What products we're putting in front of customers, whether it be keto, paleo, vegan, vegetarian, that whole dynamic organic, the whole dynamic has been about how do we create the right products for that customer base. Supply chain, we've spent a lot of time. We focused a lot on building supply chain capability in terms of distribution centers within 250 mi of our stores. That allows us to get fresher product. Fresher product resonates very well with, and 20% of our sales are fresh produce because we've really doubled down on that freshness. That resonates very well with that target customer as well. Real estate, putting stores in the right place because we understand that target customer and not putting stores in the wrong place, not trying to be all things to all men by building stores in every single corner of the country, but being very specific. We're getting better at that in terms of putting stores in the right place, which is, I think, one of the reasons the new store program has been pretty successful as well. Marketing, being very intentional about who you're speaking to and how you're speaking to them, moving from 21 million paper flyers to a 100% digital and multimedia approach to it. That's been a very significant change in terms of trying to attract, taking promotion, this high-low promotional context, which is such a predominance in the grocery sector in the United States, and unraveling that and being very careful to target those target customers, being specific to marketing, merchandising, supply chain. I think that's been a big part of why we've made some progress in the last few years. I will say we've got a million miles to go on top of this. We're not far down the route where we need to get to. Okay. I just wanted to dig into on your target customer base that you'd really narrow down to Health Enthusiasts and Innovation Seekers. If you could just touch on what exactly are they looking for? How do you ensure that the assortment and the store experience really resonates with this demographic? Secondly, how do you see the right balance between small brands that are not widely distributed, the Sprouts brand products that you are increasingly having success with, and also more well-recognized national brands? Yeah, our customers are increasingly, they're a little bit better educated and very discerning about the food that they buy. If you watch our customers in the stores, they walk around and they turn product over and read the labels at a level that I haven't seen before in terms of the intentionality of what's in the product and a real discernment about what they want to buy and what they want to see. A lot of it is about product attributes that play to their particular dietary need, whether it be gluten-free, whether it be lactose intolerant, whether it be dynamics within the specific organic requirements. We've seen a big step up in our organic business. What did we do to try and make sure we're getting the right balance? We put together what is a foraging team. That foraging team are balancing out, Krisztina, the difference between the private brand requirements that we have and the small brands that you identify, which are very important to our lifeblood. Private brand has been, we've changed the whole private brand approach. Rather than it being, let's bring a branded product equivalent in at a lower price and make a better margin, we kind of didn't want any of that commodity thing in our business. We created a private brand team who we recruited from some other places, some from the U.K. We've made some real progress on creating differentiated private brand product. Every time you look at, we've redesigned all of our private brands. When you look at what's on the labeling, it will call out the attribute that makes it different. We've made some progress there. The small brands, the lifeblood, we launched 7,500 items last year, which is extraordinary, really, in a business that's got 20,000 in total. So 7,500 in, 7,500 out. We have become the destination for small entrepreneurial. The U.S. is pretty strong in terms of bringing entrepreneurial differentiated products into the marketplace. We want to be the destination for that. We had 65,000 applications for products into our portal for products that could potentially come into our business. We only managed 7,500 of them. We are an execution that makes it more difficult than it would be for many other retailers. It is something that we think is really important to that target customer to have a very long tail of products with a lot of interesting, innovative, different attribute-based products in the middle of it. I think we've got a lot to do in this space, but I think we're creating this destination for the small entrepreneurial guys to come to us first. We've got much bigger presence than we ever had at Expo West and all the shows around the country as we try and balance this out going forward. We want both. We want private brand and we want the innovative entrepreneurial products. Great. Just touching further on this foraging team that you have created, maybe if you could talk a little bit more about their specific approaches, how do they source products? Maybe we could drill into how an average shopper comes to Sprouts. How have they been discovering you? Maybe talk about basket dynamics and then where do you see more opportunities to drive growth with this existing customer? Yeah. The foraging team is a very, it's something we kind of, we wanted to be this destination for new, innovative, differentiated products. The team came together under someone who, Kim Kaufman, who's on our ELT, she's a Senior Leader in the business. She's put the team together. What do they do to try and find it? They go to, as I mentioned, Expo West. They go to all the big shows around the country and internationally. They spend a lot of time on that. They have things called pitch slams. In fact, I think there's one going on today where 30 or 40 individual vendors will come into the office and pitch either virtually or in the office, pitch products to us. We're constantly evaluating those products. Being very close to what's happening in social media, what are the trends? We've seen something like CMOS, which has been an extraordinary success for us, started with us seeing it on social media. That whole context of being close to what's happening nutrition-wise, being close to what's happening in terms of diet on the social media space, the team have worked very hard on that. This combination, social media visiting, going around a lot of very specific shows and being very in tune with the ecosystem that exists around these products. We have to end up holding hands a little bit with some of these vendors who, to exaggerate, to make the point, they started in the garage and how do we work them so that they can come to the marketplace and be first with us. We're kind of, we feel as if we can be the starting point for a lot of very exciting young brands in the country. We're making progress with that. Maybe you could talk a little bit, Curtis, about how the customer kind of basket works and dynamic in terms of where things are. I think you asked kind of where they're coming from, and they're coming from everywhere. I think there's a real health and wellness tailwind that's sending customers our way, Krisztina. We see them coming through. Certainly, we believe they're omnichannel. Our digital efforts, our in-store efforts, really it's about providing more and more access to what we do. The two ways we'll do that going forward, new store growth, just get to more communities where these target customers live and introduce them to Sprouts. The loyalty program, I think as we get on that path and better understand who they are and what they care about and which part of this attribute ecosystem they're engaging in, that'll allow us to kind of deepen our engagement with them and then get them to come in just a little bit more often or maybe add one more item to the basket will be how we'll continue to create growth. Great. I just wanted to ask a more near-term oriented question. It looks like Sprouts doesn't experience or experiences very little just from the volatile consumer confidence and the overall backdrop that we're experiencing in the U.S. For example, yesterday we heard about higher income household trade and accelerating from a dollar store. Could you speak to what you are seeing regarding your current consumer behavior? Have you seen any shifts over the last couple of weeks or even months as well? We're clearly watching this very closely because there's so much dialogue about consumer confidence and what's happening. You would have expected some things to have changed in our environment. The reality is we aren't seeing any change whatsoever, which is quite surprising even in the last few weeks. Now, whether that'll stay, we're kind of second-guessing whether it'll stay like that. We're very clear that by region, by category, trading up, trading down, we're not really seeing a significant change in the pattern of what's happening in our business. You would probably have expected it by now, Krisztina, to have seen something in that. I think our customer base is a little bit more resilient to what's going on in the macro environment. I think you've got customers who are very health-focused. If you're interested in your diet and you're a vegan, you've got to eat. You're probably going to stay eating the things that you're focused on in terms of our target customer. I think that resilience comes, and that gives us a lot of confidence going forward, that irrespective of what happens in this pretty significantly uncertain time, we're going to be able to cope and deal with the changes as they come to us. Just maybe add a couple of things. I think from a trade perspective, trade in or trade down in that higher income consumer, I mean, one of those trades would be out of food away from home and into food at home, right? Which actually creates maybe a little bit of a tailwind as that first wave of activity happens. The second thing is to Jack's point on following the diet and being more interested in health, that is sending people our way up and down the demographic scale. You have got boomers who are really focused on longevity and just living a little bit longer. You have got the younger generation, and I am wearing an Oura Ring here, and they have got wearables, and they are keen on their heart rate and how well did they sleep. I know when I eat something lousy late at night, as I did last night for dessert, I do not sleep quite as well, and my ring tells me that. I think people are just very aware of what they put in their bodies. This food is medicine concept is sending more and more people our way every day. As Jack said five years ago, we expect more health enthusiasts five years from now than there are today. That has played out. We say the same thing today. We would expect more of our target customers tomorrow than we have today. I think those are the things that are driving people to us. No, that makes sense. I would be one of those types of customers that is always actively tracking their sleep and making sure that that is a high quality. Just in terms of categories or type of products, can you talk about what has been resonating the most with your customer, especially as we think about the potential for trade down or trade in activity to happen? Have you seen any underlying shifts in buying patterns? How do you think about rebuilding the basket going forward? The reality is that the important attribute-based products that we sell are the things that are working well for us. We're seeing a real growth in organic. That's been pretty dramatic for us. More than 50% of our produce sales are now organic, which is leading us to some really good long-term relationships in the agriculture space. The whole diet trend around gluten-free has been pretty significant for us. We've seen a pretty significant growth in keto for us. Protein, if you go around Expo West, everyone was talking about protein, and protein's getting added to the most weird and wonderful products in our categories. As you look, that's probably a very significant trend that how that's evolving. What it's translating into is we're seeing strong performances in our dairy frozen grocery for all the same reasons. It's all attribute-based products across the different categories. You're also seeing some interesting things happening in non-alcohol, alcohol that's non-alcohol, which I know is a bit of a misnomer, really. We're seeing some real success in that space. Non-dairy dairy, we've seen some real success in. A lot of it's driven by attributes. That's the progress that we're seeing significantly across the different categories. Great. You have obviously embarked on the strategies that you've eliminated what you referred to as the coupon clippers. That has resulted in a significant upgrade in household income. Do you think that your model post the strategy change just makes you maybe less vulnerable to the overall macro and overall price intensity of food retail? I wanted to touch on how you think about your pricing perception of Sprouts in particular key departments across the store. Very specifically, as we're not, talk about pricing specifically. Produce pricing is very important to us. We spend a lot of time. It's the origins of the company. It's the DNA of the company. It's a bigger proportion of our business than anything else. We spend a lot of time looking at produce pricing. We have a very strong gap in organic produce pricing. We spend a lot of time analyzing where we need to be against conventional grocers and against Whole Foods as we look at our produce pricing. Other categories, we don't have the over, we don't have the direct comparison. Increasingly, we've been getting ourselves in a place where the assortment that we're carrying does not appear in other places, with the possible exception of Whole Foods. Across the rest of the marketplace, we're not really carrying the same things as other people. The way we look at pricing is about elasticity. If we put a product out there that's got a fair value for the customer and no one else is selling it, the customer will buy it. If they do not buy it, then maybe we've got the pricing wrong. There is a lot of micro pricing work being done in our organization to try and understand exactly where that needs to play out. By and large, the focus of our value proposition is we're giving customers healthy products, differentiated products, innovative products, and they will respond to that. They have responded pretty well. We do not see our price perception in the context of what is it against other grocers. We see it in the context of how does it work with our individual customers. That is the context of our pricing decisions. It's taken me a little while to get my mind around that as having been a grocer for 100 years in every other place. The context of thinking about this in a different way reflects that we really love being different as a company. Thinking that through is how we navigate our way to thinking about our price perception. Great. Just one more on competition. We've talked about consumers increasingly shifting to health and wellness. We've also been seeing some of your conventional competitors promote Sprouts-like events or really launching differentiated whole-bean products. Can you talk about your confidence that Sprouts can maintain its differentiated position in the face of growing competition? Certainly, when you're performing so well ahead of the market, that is going to be drawing some attention to you. How are you thinking about sustaining that? I think it gets back to your original question about what we're trying to do. That focus on a narrow customer segment allows us to be very focused on it. Remember what we said, there's $1.4 trillion that we don't go after that the other guys, the main conventional guys, certainly have to go after. You can't chase all, you can't chase, and they're doing quite well on some of those products, but it's not going to do enough for them. They have to spend their energies chasing after the $1.4 trillion that we're not chasing after. We can be very, and if you, we feel very confident that the way we think about a long tail of assortment is something that other people won't want to do. Not that they couldn't do it, but they wouldn't want to do it because they would lose a lot of their capabilities of selling high-volume products in the $1.4 trillion marketplace. We only, you'd have to take Coca-Cola out of your business to really focus. We sell probiotic sodas. We don't sell Coca-Cola. To bring all those probiotic sodas into the business and take Coca-Cola out would be, frankly, pretty silly for those guys to do that. We think we've got an inherent strength in that. They are doing fairly well with it because the customer's evolving to it. The reality is we're in a position, I think, to be so narrow in our focus. We're relatively small still in the great scheme of things. Our $8 billion doesn't compare really with some of the other people you're identifying in that conversation, Krisztina. Great. I wanted to bring in Curtis a little bit more. Switching gears to gross margin, obviously, this has been another aspect of the Sprouts story over the last few years as you've really eliminated just Sprout-based promotions. You continue to find gross margin upsides even this year. You have many initiatives, including category management and supply chain enhancement. Curtis, can you walk us through maybe where you see incremental opportunities that you still see ahead? Just overall philosophy of how much you want to flow through versus how much you want to reinvest in the business. Yeah, sure. Yeah. We're still a fairly immature business. It's only been 10, 12 years since we went public, and we're growing really fast. We continue to find opportunities to just do things more effectively and efficiently. We're not reinventing the wheel here. These are tried and true kind of grocery and retail techniques. Inventory management has been the space in the last 12- 18 months that we've really seen gains. Much lower shrink, more efficient in the 7,500 products that were taken in and out of our business every year. From a markdown perspective, just getting sharper and using tools and data and process to make better decisions in that space. These are kind of behind-the-scenes cost items that we've taken out. It's not an impact to the consumer at all. We haven't been raising prices to get that margin. It's been cost takeout and process efficiency in how we work through the entire supply chain. Those are things that we've taken advantage of recently, but we'll also have opportunities still to go because we're not done yet as we continue to invest in replenishment and those types of capabilities. I think the other thing we think about, and it kind of goes to the last part of your question, is we're going to continue to reinvest in the business for the long-term sustainable earnings growth and the health of the business in 2027 and beyond. That's a little bit of how we've gotten some of those gains as well. A couple of years ago, we invested in capacity in the supply chain, right? That allowed us to then come back and, as we add new stores, create leverage, or as we look ahead to meat and seafood self-distribution, right? It gives us the capacity in the room to go do those types of things that continue to drive gross margin leverage. Lastly, we'll have loyalty, which at the early stages, as we're in right now, will be a bit of an investment for the points that we'll give on the loyalty program. As we take in that first-party data and we get to know our customers at a deeper level, it should create opportunities not only in gross, but throughout our business to go ahead and reshape our merchandising, our operations and service, our marketing, and how we serve those customers. We get to go do that again with the benefit of first-party data and the insights and the learnings that we've had the last five years. We are pretty excited about the opportunity and the upside. Again, we really talk about stable, more on the bottom line. Stable EBIT margin is the commitment we've made. That becomes kind of the floor. As we go execute these programs, one, if the comp momentum continues, then you'll see a little bit of leverage drop to the bottom line from strong comps. As we go execute these programs and we do it well, we outperform our business case, then you'll see a little bit of flow through to the bottom line as well. Because these are foundational elements we're just making better, these are not one-time things that we're doing. That just creates a new floor for next year's stable guidance. As we get gains, as we have the last few years, we'll keep them and we'll just keep moving forward, looking to stamp out more inefficiency in our business. Great. You touched on self-distribution. Fresh meat and seafood is something that you're undertaking this year. Can you talk about the expected benefits in terms of freshness, control, and then overall profitability to the gross margin? Maybe later down the road, what are some potential other areas for self-distribution that you see in the business? I'm going to cover the benefits side. I'll turn it over to you for the future. Yeah, on the benefits side, I think you've got it right. I think a little bit closer relationship with our suppliers. We just like that direct connection to them to be able to work better together. Right out of the gates, we've got the fee that we're paying for the distribution historically is the pool of funds. Then we've got to pay for it ourselves in our own ecosystem. There's just a little bit of arbitrage that'll flow through the gross margin there, assuming that we execute really well, which is where we're heads down and focused on this year is getting it right so that we do capture that little bit of gross margin benefit. Beyond that, we should see in the partnership with the vendors, better in stocks, right? Better allocations, better fill rates, getting the right product to the right stores with just one less complication in that dynamic. We can go direct to suppliers and do that a little bit better. That should result in some better sales for us down the line as we have better in stocks. I'll kind of let Jack talk about what this might lead to in the long term. Yeah, and specifically on the meat thing, I'm anticipating when you become a specialist meat retailer, which we have become, grass-fed, no antibiotics, very conscious of the husbandry of the animals, we can work longer-term programs with the vendor base. That's going to be something that's, I think, going to help us instead. Good stead as we grow scale. As we grow scale, how do we think this through? As Curtis said, we've invested in distribution capacity, which gives us optionality going forward. We've got a number of areas as we grow geographically. We're going to have to build some more DCs as well. We'll build them with enough capacity, which will have some effect in the short term, but it'll have enough capacity going forward. What are the areas that are going to matter to us? Private brand's going to be important to us. Sprouts brand's going to be important to us as we grow in scale. Should we find some way of becoming more, having more control of our destiny in that space? Probably. Our vitamins and supplements departments, which are really important to the differentiation of the company. Grocers have pharmacies. We have vitamins and supplements departments where you can give people advice as to how they can navigate their health journey and navigate the way they can look after themselves. We've got people that are really important. We probably haven't got the supply chain behind it that I would like going forward. Areas like that, as we think about it, might not be self-distribution. It might be, but those are the kind of categories as we grow that we're going to have to take a little bit more control of our own destiny so that we can free up our business to look after customers more effectively. That is very much a big part of the kind of supply chain investment. How do we create resource to make the world a better place for our customers when they come and interface with our team members? Great. One other exciting aspect is you're launching a loyalty program that's going to be rolled out starting in the third quarter. Maybe if you can talk about the overall roadmap to provide that tailored unique need for your customer, what kind of comp do you expect to gain from the program in order to keep it margin neutral? Any insights that you can share from your initial pilot program? I'll let you build on it, Curtis. The starting point of this is we're really excited about our loyalty program. The reality of our customer base is such. We have to understand the nuances of what I, when we say health enthusiast, innovation seeker, there's a lot of nuance within it that we need to kind of understand even better than we have been. Whether it be you're a grass-fed meat customer, you're a vegan customer, you're a keto customer, you're an organic customer, how do we understand that nuance more effectively so that we can communicate more effectively? Where we are at the moment, we're in 35 stores. Those 35 stores, we've been working very hard on the user experience around the loyalty program to make it much more customer, to take the friction out of the customer journey on that. We've worked our way through that. It's been expensive. It's been a long journey. What we're feeling, we've got to the end of that journey now, and we're ready now to roll it out. That journey now starts to roll out in July. By the end of the year, we'll be in all stores. What do we want customers to do as this rolls to all stores? We want them to sign up. They're signing up on the basis that they get points. They get $2 for every hundred, basically, is the way it will work. From that, how do we get them to scan? We need them to sign up and scan. That's the basis of getting this thing kicked off. From that data, what are we going to do with it is a kind of exciting thing for our business right at the moment. We draw inspiration from people like Sephora and Ulta, who I think are in the conference here today, and other people like REI, more so than we draw inspiration from the grocery schemes that we see around the world, all of which tend to be a little bit transactional, a little bit about, "Here's 10 cents off your gas," or, "Here's some price for you that the other guy cannot get." We do not want to get into that space. What we do want to do is understand the customer. The vision would be that when you open the app, it is individual to you. It makes it really clear that the personalization dynamic so that you feel special and feel something special. We will build on that by creating ways to spend your points that go beyond just getting money off the register and how you access different things. The team are in the middle of that. It is a really exciting phase of our evolution back to who we want to serve and how we look after that customer. Our purpose is to help people live and eat better. We think this loyalty program is going to help us do that in a very individual way. I do not know what you want to do. Yeah, I think we expect it to be a little bit of a longer journey too, Krisztina. I mean, we have a lower frequency customer that comes through our doors. It will take us a little bit longer to gather all the data we will need to really create and stimulate the demand in the ways that Jack is talking about. We expect it to be incremental and multi-year incremental to our comp. It should be a tailwind for the next several years that will help us deliver, sustain the momentum we are on and deliver the comps that we promise. I think it will evolve as well. It will iterate from an experiential perspective, right? We do want to create that community feel to it. We will be working on different ways to do that beyond just the points starting point that we are using. Certainly, you could get to our innovation is a big part of what we do. So access to new products and unique products first. I think you could think about demonstrations around cooking and recipes and influencer-led events and things like that and giving access to some of those things for the folks that are in our loyalty program. I do not know that that specifically would be it. I will leave that to the marketers to deal with. They will be coming up with great ideas like that and better ideas than that in all likelihood. That will create that kind of community feel that we are after for our target customer. Great. I'm already signed up. I'm excited for these. You just have to open a store nearby Manhattan for me to attend. We're getting closer. I suspect we'll get to that question here shortly. We're on our way. That's a good segue for us to get to new store growth. Another big part of your story. Maybe just given your differentiated sourcing approach, if you could talk to us about how you see the long-term store growth potential, where do you see the greatest white space opportunity ahead? When do you expect the new store openings to start tilting more towards newer markets as opposed to filling in existing markets or that 50/50 balance that you're currently achieving? Yeah. So 1,200- 1,400. So 1,200 + sites. I mean, we've got them kind of plotted out. As you know, we've talked about our journey on the site selection process and the analytics that underpin that. We've got pins in the map across the U.S. in about 1,400 different places, and we'll be able to get there in due course. More specifically, we'll get into the Midwest with kind of Chicago as the center point. We will get into the Northeast, kind of greater New York and into Boston. We've opened up those geographies after doing a little bit of consumer research to confirm that we're ready to go with the right go-to-market in that space. That'll allow us to go a little bit faster and continue to accelerate our unit growth as we head towards 10%. That'll probably start in 2027, practically. As we start signing them off now, it'll take a couple of years to get those out of the ground. The shift of the business, it's been interesting the last five years that really the 50/50 has been kind of the East Coast, right? The 50% non-established, a lot of Florida, a little bit in the Southeast, up into the Mid-Atlantic. That's been our non-established 50%. The performance we've seen has been really encouraging, and it gives us a lot of confidence to continue to go fast and that they're doing really well. They're starting to open at higher levels. They're comping really strongly. It's starting to resonate, really resonate with the target customer. Those markets are almost graduating into a more established market. I view the 50/50, it'll kind of just stay the same. It'll just be a little bit, it'll be the different markets. It'll be the Northeast and the Midwest that will become our non-established markets where we'll start with a little lower density and awareness. Those other markets will fold into a more established state and probably look a little bit more like your Texas, Colorado, Arizona, California type markets as we evolve going forward. It should continue to have that split, which gives us a nice kind of cannibalization balance where we don't see much in those new markets, and we see a little bit in the existing markets as we infill. It'll kind of play out similarly, we expect, over the next five years as the last five years, just with different markets. I think one of the things that's quite interesting about the new stores is what's happened to places in like Florida for awareness. As we get, what we've gone and awareness going from 30% - 75% in some of our markets down in Florida as we build the store. Getting critical mass and getting enough stores quickly to make the awareness move fast is going to be one of the big challenges for us in places like Chicago and Boston and the New York metro area. Those opportunities, and we're thinking very hard about how we can market and move a little bit faster so that this dynamic of new markets and old markets fuses into one. We're just able to open stores everywhere. A little bit of that is building awareness in advance. We're thinking very hard about that. We're having some real thoughts with our marketing teams about how we can get ahead of some of the markets that we're not in and maybe move a little bit faster with awareness, which will allow us to maybe get the stores opening. You won't have this difference between old stores, new markets, and old markets that we've traditionally talked about. We're working pretty hard about that. The other thing I would say is the smaller stores is now much easier for us to execute than we've ever. We've now got the cadence of building 23,000 sq ft stores, which I don't think we've talked about. We've gone from 32,000 sq ft- 23,000 sq ft. We can launch these much more effectively. We're finding that I think we'll be able to do better in new markets than we traditionally have done. Great. One interesting aspect of your business is your overall sourcing and then your increased focus on local sourcing as well. As we think about where the majority of your footprint sits and where you've been growing in areas like Florida and Texas, it really has been more or less concentrated in areas with stronger growing seasons or just overall closer to areas where more food generally is grown. As you think about the expansion more into the Northeast and then followed by the Midwest, just how do you manage that expansion while maintaining that farmers' market appeal of the overall Sprouts experience? Yeah, I think it's a great question. I've been thinking pretty hard about it. I think about markets like Colorado. Each of our distribution centers, we have local sourcing expertise, building long-term relationships. A lot of it primarily links to our fresh produce business, which, as we keep saying, is so important to us. Colorado's got a very short window because it snows a lot there. You have a short window, but you have to work really hard when it really matters to source it appropriately. We'll have to think about that a little bit in Chicago when we get to Chicago and building relationship with growers in Michigan and building relationship, which again, Colorado's a good parallel to think about how you would do that. We'll be building relationships so that you can source products locally. We will bring some partners on board who can help us with this in markets where we are not known. Each distribution center will be sourcing locally and will be a sensitive one. At the moment, we have a partner helping us in the Mid-Atlantic. Jersey Tomatoes being ahead of that kind of program, you would not have said that that would be a Sprouts expertise a few years ago. We think we are working very hard at when the markets are there, we will be there to support the growers and give longer-term commitments, two- to three-year commitments so that people will grow for us, encouraging them to grow organic, regenerative agriculture. We are working very hard locally. Each market is going to have its own dynamic. We will do the same. People are eating a lot of fresh produce in Chicago. When they get it, it will be as local as we can get it. Hopefully, we'll be better than most. We've certainly made a lot of progress in Florida. I was with the Florida agriculture people last week. We've really doubled down on how we can work closely in the season when it matters. We're confident about it. It's something that's in our DNA, and it's something that we're working hard at. Great. I just wanted to switch to digital where you have seen really strong growth over the last several years, not only with your original partner, Instacart, but even with newer partners, DoorDash, Uber Eats, and then when you started to anniversary those additions as well. What has been contributing to this such strong growth? How do you think about digital growth from here? Maybe talk about what are some of the key differences in digital orders versus in-store shopping habits? Sure. I think for us, it starts with the assortment always. It is that differentiated attribute-based assortment. If you are going online to get groceries, if you are going for Coca-Cola, you have got 1,000 options. If you are looking for something in the long tail of keto, you do not have that many options. I think that is what our customer is seeking, our assortment out online. It is why you have seen the growth you have seen in our business, which gives us a lot of confidence that it is different and it is unique because of the way that the customer responds digitally. I think secondarily, we have growing up as a fresh foods retailer, and particularly with fresh produce, we have got an inherent kind of brand trust in what we do that you will find the best and the freshest produce at Sprouts. Our online mix for produce is the same as it is for a Brick and Mortar transaction in store, which just, again, reinforces that they trust that if you're going to have somebody pick your apple for you, it better be somebody that you trust that you know will do it well and will have the freshest product. That is what we see is the assortment and the mix of departments is roughly the same online as it is in store. The basket size is a little bit different. It's about 2X on an Instacart delivery order, what it is, Brick and Mortar. Uber Eats and DoorDash is a little bit more of the convenience shop and a little bit more milk, eggs, bread, kind of what's for dinner tonight. A slightly different mix for them, but still really strong baskets. They're in the same range as our Brick and Mortar in-store basket, kind of in that low to mid-40s range. Yeah, all three partners have been excellent partners. They get on great with the stores. They take great care of the customers. They pick great fresh produce for the customer. We'd expect that to continue to grow. For us, it's a convenience play and an access play for our target customer. Our Brick and Mortar trade area would be about 10 minutes drive time for most of the customers. The e-com trade area allows us to expand to about 30 minutes drive time. If you live 25 minutes away from a Sprouts and have a 50-minute round trip, maybe you have a new baby at home and you're not willing to make that 50-minute round trip, but you love what Sprouts does, now you've got another option. That was the idea around Instacart, Uber, DoorDash. It's a different pool of customers that just provides access and a bit of convenience that we can't provide with our Brick and Mortar footprint. They now have that online. I think the assortment continues to be different. We continue to have that opportunity to access the customer in different ways. We'll allow them to choose. The penetration will be what it'll be based on how the customer chooses to interact with us. We expect it to continue to grow in the next five years. Great. Maybe 30-second rapid fire to round this out, Curtis, just capital allocation priorities, balance between store growth, share repurchases, any potential for M&A opportunities. Yeah, we always invest in the business first. The things that are driving EBIT in our business today are the things that we're going to continue to invest in. Store growth, supply chain, loyalty personalization, innovation, team and technology, that's our first priority. Our 3%-3.5% of sales guidance kind of allows us to do all the things that we've got the bandwidth to do in that space and feel good about driving returns on. Outside of that, we've paid down the debt. We're really toggling between interest income and share repurchase. When the price is a little bit lower, we buy a few more shares. When the price is a little bit higher, we'll earn a little bit on the interest. There's just a math equation there. We will always take the excess free cash flow and return it to the shareholder in the most efficient way possible. On the M&A side, we look and things come along and we will always look. Practically, it is important for us that it has to fit our target customer. It has to accelerate our strategy. It has to make sense financially. We have to be able to execute it and have the bandwidth to do it in such a way that it does not impact the core business, which is really going right now. When you think about a short list of potential players there, there might not even be a list to think about. We are pretty heads down. We've got plenty to do while we're doing it. Yeah, we're pretty heads down and pretty focused on the organic thinking at the moment. Correct. Okay. Great. I think that rounds us out for time. Thank you so much, Jack and Curtis, for a great presentation. This has been a very enjoyable conversation. Thank you again, everyone, for attending. This will conclude our fireside chat. Thank you and good luck. Krisztina, good luck, Krisztina. Good to see you. We'll see you again soon. Thank you.