Good morning. My name is Brent, and I will be your conference operator today. At this time, I would like to welcome everyone to the TD SYNNEX Third Quarter Fiscal 2022 Earnings Call. Today's call is being recorded, and all lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. At this time, for opening remarks, I would like to pass the call over to Liz Morali, Head of Investor Relations. Liz, you may begin. Thank you. Good morning, everyone, and thank you for joining us for today's call. With me today are Rich Hume, CEO, and Marshall Witt, CFO. Before we continue, let me remind you that today's discussion contains forward-looking statements within the meaning of the federal securities laws, including predictions, estimates, projections, or other statements about future events, including statements about strategy, plans, and positioning, as well as our expectations for fiscal year 2022. Actual results may differ materially from those mentioned in these forward-looking statements as a result of risks and uncertainties discussed in today's earnings release, in the Form 8-K we filed today, and in the Risk Factors section of our Form 10-K and our other reports and filings with the SEC. We do not intend to update any forward-looking statements. Also during this call, we will reference certain non-GAAP financial information. Reconciliations of GAAP to non-GAAP results are included in our earnings press release and the related Form 8-K available on our investor relations website, ir.tdsynnex.com. This conference call is the property of TD SYNNEX and may not be recorded or rebroadcast without our permission. I will now turn the call over to Rich. Rich? Thank you, Liz. Good morning, everyone, and thank you for joining our call. One year ago, we held our first earnings call as TD SYNNEX, having closed our merger on 1 September 2021. In our first 12 months together, we've accomplished a lot and have validated the value proposition that led to our merger. Over the past 12 months, we generated $62 billion in revenue, over $1.7 billion in adjusted EBITDA, and $11.35 in non-GAAP earnings per share, representing 35% in accretion and well above our initial 12-month target. In addition, we have already realized merger-related cost synergy benefits of $140 million, which is ahead of our initial expectation of $100 million in the first year. Making those results possible, our teams have been hard at work harmonizing every area of TD SYNNEX, from partner-facing elements, benefits and policies, to organizational design, finance and IT systems, corporate branding, and culture. As a result, we have become one combined company through an incredibly busy and dynamic year, and I would like to personally thank our more than 22,000 coworkers for their exceptional work, dedication, and perseverance in helping to make it possible. With the first year behind us, we believe that the thesis for our merger is stronger today than we anticipated last September. Our partners now more than ever realize the importance of broad global capabilities and deep customer relationships to help them efficiently expand. For our 150,000-plus customers, the majority of which are small and medium-sized IT resellers, it is increasingly important to have a trusted partner to help them navigate the IT landscape, especially in high-growth technology areas such as hybrid cloud, security, analytics, IoT, as well as others. We are pleased with the fact that these areas had robust growth in the quarter and continue to outpace our overall growth rates on an annualized basis. In addition, our Hyve business, which serves the hyperscale infrastructure space, also exceeded our revenue growth expectations for the quarter. Turning to the third quarter, we performed above our expectations with worldwide revenue growing 7% year over year and 15% in constant currency when normalized for the merger-related revenue recognition policy alignment. This is better than the adjusted growth of 10% year-over-year that we expected when we provided our third quarter outlook in June. Growth in the quarter came from across our business with robust demand in endpoint, data center, and hyperscale infrastructure. In PC specifically, where we primarily serve the commercial segment, we continue to see solid commercial client device demand and ASP increases during the quarter. We also saw robust revenue growth on a constant currency basis across all three regions. Fiscal 2022 has played out in line with our expectations at the beginning of the year, with strong customer demand in the areas like data center, networking, hybrid cloud, hyperscale infrastructure, and security projects. Supply chain disruptions continue to exist and remain elevated in the areas of data center, infrastructure, and networking. Although improved in areas like endpoint, including PCs, which have seen moderating year-over-year growth rates. Given the variety of factors that have led to these supply chain issues over the past two or three years, it will take time to get back to a normalized supply chain environment. Our backlog remains elevated compared to our historical levels, and we anticipate that we will continue to see industry supply imbalances well into 2023 in some product categories. As we look ahead to the fourth quarter, we project a solid demand picture as evidenced by our revenue guide of mid- to- high-single-digit growth when adjusted for constant currency and the merger-related revenue recognition policy alignment. Despite the less than certain environment ahead, we believe we have built a strong, resilient business that has a long history of successfully operating in many different macro cycles. Our broad solutions portfolio, liquidity profile, and variable cost structure have allowed us to deliver results through dynamic changes in the economy. We continue to believe that the overall IT market will grow. We also believe that solutions like hybrid cloud, security, hyperscale infrastructure, IoT and analytics will have growth rates above the overall IT market. As we have discussed in the past, we are investing in these high-growth areas. Progress is evident on our high-growth technology strategy as year-to-date revenue in this area grew more than 20% and represented more than 20% of our third quarter total gross billings. We were also recently recognized with two very important partner awards. TD SYNNEX was named Hewlett Packard Enterprise Global Distributor of the Year for 2022, and the Microsoft Worldwide Partner of the Year for 2022, our second consecutive year in achieving this honor. These acknowledgments are important testaments to our commitment to invest and partner with top technology vendors, providing our customers with outstanding solutions based on leading edge cloud and as-a-service technologies. For our customers, this is key as we help simplify complexity, accelerate their time to market, reduce the skills gap, and help them expand their portfolios to new markets. Marshall will provide further details on our merger-related cost synergy attainment in a few minutes. Let me give you an update on our ERP systems consolidation in the Americas. As mentioned earlier this year, our Canadian conversion efforts were successful and approximately 90% of our Canadian business is now transacting in CIS, the ERP system used by Legacy SYNNEX. Our US transition is now underway, and we expect to have a meaningful portion of that activity migrated by early first quarter, with the remainder transitioning throughout fiscal 2023. In closing, I am proud and energized by how the efforts of our entire global team have come together and believe that we have the necessary market leading capabilities and resources to serve the IT partner ecosystem now and into the future. Before I turn it over to Marshall to provide additional details on our financial performance, please know that our thoughts are with all of those impacted by Hurricane Ian. The safety and well-being of our coworkers is top of mind for us, and with one of our main offices in the Tampa Bay area, we are carefully monitoring the storm's progress and projected path. Marshall, I'll turn it over to you. Thanks, Rich, and thanks to everyone for joining us today. We performed well in fiscal third quarter with revenue growth above our expectations and margin growth year-over-year. This is a testament to the focus and commitment of our teams amidst a hard-to-predict macroeconomic backdrop. Please note that comparisons versus prior year are on an as combined basis, which assumes the merger occurred at the beginning of the period. Total worldwide revenue for fiscal third quarter was $15.4 billion, up 7% year-over-year, and up 15% in constant currency when normalized for the revenue recognition policy alignment relating to the merger. This is better than the 10% adjusted year-over-year growth rate we expected when we last spoke in June. Euro devaluation accounted for an approximate $700 million headwind year-over-year. From a revenue perspective, all three regions grew in the quarter, and we saw broad-based product growth across distribution with robust double-digit growth in high-growth technologies. Hyve had a record quarter as this high-growth technology business responded to unusually strong hyperscale demand. Gross profit was $916 million, and gross margin was 6%, down approximately 30- basis points from second quarter, primarily due to customer and product mix. Total adjusted SG&A expense was $544 million, representing 3.5% of revenue, in line with our expectations and down approximately 30- basis points compared to second quarter. Non-GAAP operating income was $398 million, up $44 million or 12% year-over-year, and non-GAAP operating margin was 2.6%, up approximately 10- basis points year-over-year, driven by cost discipline and merger synergy execution. On a constant currency basis, non-GAAP operating income increased 15% year over year. Due to the higher than expected interest rates during the quarter, non-GAAP interest expense and finance charges were $50 million, $5 million above our outlook, and the non-GAAP effective tax rate was approximately 24%, in line with our expectations. As a reminder, our outstanding senior notes bear a fixed interest rate, while interest rates on borrowings under our term loan are variable and borrowings under our revolving credit facility bear a floating interest rate. We have partially hedged the variable interest rate on our term loan. Total non-GAAP net income was $263 million, and non-GAAP diluted EPS was $2.74, consistent with our previous guidance. Now turning to the balance sheet. We ended the quarter with cash and cash equivalents of $351 million and debt of $4.1 billion. Our gross leverage ratio was 2.4x and net leverage was 2.2x. Accounts receivable totaled $8.1 billion, up from $7.9 billion in the prior quarter. Inventories totaled $9.8 billion, up approximately $1.3 billion from the prior quarter, but offset by approximately $1.2 billion of increased AP as our partners continued to adjust their terms. More than 1/2 of the inventory increase was in our distribution network. This increase was due to strong revenue growth and the elevated backlog. As a reminder, the majority of this inventory is covered by price protection agreements and recovery of inventory carrying costs. The remainder of the increase represents purchases for our hyperscale infrastructure business to support the demand forecasts of our customers. These inventory increases carry minimal risk and generally result in margin increases for Hyve. We expect this inventory to translate to revenue and profit generation in fourth quarter and beyond. All in, we expect inventory turns to improve in fourth quarter and into fiscal 2023. Our net working capital at the end of the third quarter was $3.9 billion, an increase of approximately $300 million from second quarter. Our cash conversion cycle for the third quarter was about 23 days, up two days from second quarter, and our cash used in operations in the quarter was approximately $67 million. From a shareholder return perspective for the current quarter, our board of directors has approved a cash dividend of $0.30 per common share. The dividend is payable on 28 October 2022 to stockholders of record as of the close of business on 14 October 2022. We continued executing on our share repurchase program in the quarter, repurchasing $30 million of our stock and $83 million through the first three quarters of fiscal 2022. We remain ahead of pace to achieve our targeted repurchases of $100 million for fiscal 2022 and are on track for our medium-term target of 50% of free cash flow return to shareholders in the form of dividends and buybacks. We have $317 million remaining on our three-year stock repurchase authorization, which expires in July 2023. Finally, from a merger related cost synergy perspective, we remain ahead of plan for year one, expecting to recognize $140 million compared to our initial plan of $100 million. We continue to expect to achieve a total of $200 million in cost synergies by August 2023. Now moving to our outlook for fiscal fourth quarter. We expect total revenue to be in the range of $15.2 to 16.2 billion, which when adjusted for currency impacts of approximately $700 million and revenue recognition policy alignments of approximately $450 million, equates to growth of around 8% at the midpoint on a year-on-year basis. Growth rates are expected to be lower than third quarter, primarily due to the unusually strong hyperscale demand in Hyve in third quarter and a more cautionary approach to guidance given the macro backdrop. Our guidance is based on a euro to dollar exchange rate of 1.01%. Non-GAAP net income is expected to be in the range of $259 to 298 million. Non-GAAP diluted EPS is expected to be in the range of $2.70 to 3.10 per diluted share based on weighted average shares outstanding of approximately 95.2 million. This equates to full year 2022 non-GAAP EPS of $11.19 to 11.59, compared to the outlook of $11.15 to 11.65 that we provided in June. Interest expense for fourth quarter is expected to be approximately $60 million, and we expect the tax rate to be approximately 24%. In closing, despite the current economic headlines, we are confident in our business and bullish on the growth prospects for our company, given our participation in large and growing markets, our solid history of execution and shareholder value creation, and our decades of experience in managing through economic cycles. We will now take your questions. Operator? At this time, if you would like to ask a question, press star followed by the number one on your telephone keypad. We ask if you limit yourself please to one question and one follow-up question. Your first question comes from the line of Keith Housum with Northcoast Research. Your line is open. Good morning, guys, and thanks for the opportunity. If you don't mind just revisiting real quick the high-growth technology area that was up year-to-date 20%. Now, Rich, can you remind us how big that is of the total business? Yeah. Usually, Keith, we talk about the high-growth technology segment in terms of gross billings because, you know, a lot of those offerings, especially the cloud-based ones, get netted. As we said in the prepared script, it now is slightly over 20% of our entire business from a gross billings perspective. Keith, gross billings for the quarter came in just under $20 billion. Great. In terms of the guidance as a follow-up, you know, obviously, we're in a volatile time here. And I saw obviously you're bullish on, you know, the trajectory of the business, but maybe talk a little bit about your puts and takes as you think about your guidance for the next quarter and what will it take to perhaps meet the high end or low end of the range? Yeah, there's a few things that are influencing our overall thoughts for fourth quarter. One is interest expense. Just to step back, when we guided third quarter, we guided at $45 million, and of course, we came above that at $50 million. We got it for fourth quarter at $60 million. That's probably the biggest EPS difference in terms of where we thought we would be. Certainly, the comment I made about the broader macro environment is putting us in a position of just being cautious. As usual, Keith, when we look at the hyperscale infrastructure range, we tend to guide at the lower end of that range. Great. Appreciate it, guys. Thank you. Good luck. Thanks, Keith. Your next question is from the line of Joseph Cardoso with JP Morgan. Your line is open. Thank you, and good morning, guys. Yeah, first question from me, can you just provide us an update on how backlog has tracked exiting this quarter and how the mix of that is shaking out? Also, where do we stand relative to what you would consider to be normalized levels? Any thoughts to when we might reach those more normal levels? Yeah, great question. Thank you very much. So a couple of things. Number one is the backlog has come down, but it's sort of the tale of two cities. So first in the endpoint segment, you know, backlog has come down, and we're finding that the sort of PC ecosystem things are more serviceable. Interestingly enough, there was one vendor in particular that there was a really big backlog reduction, because they've really made quite great progress relative to you know, servicing that backlog. But the good news in that is that that particular vendor has a lot of strength going forward. So you know, this isn't the situation we don't believe, whereby the backlogs run off and suddenly we find ourselves sort of trending to having a challenging growth. I mean, the demand is strong, moving forward. Summarizing again, endpoint is down, but the predominance of that is led by one vendor who has a lot of strength going forward. As it relates to what we call the Advanced Solutions segment, within there's many that are still growing backlog and few that either are stable or declining. Within the Advanced Solutions segment, we have not yet seen the peak, if you will. You know, we would anticipate that it'll take until, you know, sometime well into 2023 until we have stability from an Advanced Solutions perspective. That's barring obviously any new flare-ups from COVID or anything else that might happen in the world. It does remain elevated, and I would say that we'll be in that elevated state for, you know, the foreseeable future. Again, you know, crystal ball, sometime mid 2023, maybe there's better stabilization. I'd just add to that. You asked the question, Joseph, on what is normalized levels. It's a good question. We didn't track it very extensively pre-pandemic, but if I were just to guess, and I'll also look at Rich, it's usually about a month's worth of turn is how I think about it. Rich, do you have any other thoughts on that? Yeah. No. We are materially over that still. No, appreciate all the colors. Maybe just a quick follow-up on the Hyve business. You know, it sounds like this quarter the business was very strong, you know, like you guys highlighting record levels. You know, but there seems to be broader concerns from the investment community around hyperscale spending moderating going forward, and I think it's led by commentary from some of the component suppliers in memory and storage alike. You know, just given what you're seeing from your customers to date, you know, can you provide any color on what you're seeing relative to demand trends there going forward? Are you concerned of a potential digestion period, you know, heading into 2023? Thanks. Maybe I'll start and then turn it over to Marshall. First, just a reminder to everyone, we state this every opportunity we get. Hyve is a lumpy business, but we feel as if it always offers great growth attributes on an annualized basis. As Marshall said in his prepared comments, this time the lumpiness was more positive than we thought. We see good demand. Candidly, I think we see demand consistent with our guide here as we look into fourth quarter. Which still is pretty good demand overall, you know, for that segment. You know, so I think that, you know, from a strategic perspective, we always talk about over the longer periods, hyperscale sort of segment being double digits sort of growth attributes. You know, I know of nothing that would cause me to think differently relative to that segment. Yeah. Joseph, I would just add in regards to hyperscale infrastructure, on the supply chain constraints, there's also a supply chain inefficiency on the data center availability and opening. The hyperscalers are struggling to keep up with their capacity themselves. We do have quite a bit of product that is in queue ready to be positioned and put into data centers. It's not just the supply chain itself, but it's all the way through to getting the racks rolled into data centers. Yeah. If I could, just to kind of finish Marshall's thought, you know, this supply that he talks about in quarter, we have hard orders for all of it. It's just the, you know, the ebbs and flows of the construction of the data centers. That's right. That stays obviously inventory on our books, which is one of the reasons why we see elevated inventory in the Hyve space. No, makes sense. Appreciate all the color. Your next question is from the line of Ruplu Bhattacharya with Bank of America. Your line is open. Hi. Thank you for taking my questions. Rich, from the commentary that you gave, it looks like, you know, demand remains very strong. I mean, you talked about continuing demand even in the PC business, the endpoint business and strong growth more than 20% in the Advanced Solutions business. I'm trying to reconcile that against what we've heard so far from OEMs, right? We've heard certain OEMs talk about weakness in the PC end market, consumer PC market, but also in the commercial PC market, some weakness developing. Some OEMs have talked about some incremental weakness in the enterprise businesses as well. Help us reconcile like, you know, the strength that you're seeing versus what we're hearing from OEMs. Could it be because of share gains that you're having? Could it be because of synergies that you're seeing, revenue synergies? How should we reconcile the commentary that we're hearing from some OEMs versus what you're seeing? Yeah. Ruplu, thanks for the question. First, I think it's important to highlight once again that, you know, we don't have a big reliance upon the consumer segment. You know, from our numbers perspective, you know, the consumer segment is where things are being more deeply felt. Second, you know, I think once again here, we benefit from our portfolio. We have the privilege of serving, you know, the top-tier, you know, PC vendors in the market. You know, sometimes those demands for products ebb and flow, between them, you know, depending on their cycles, et cetera. You know, I think that serves us well. I know that Marshall has some more detailed comments he wants to make, but I just want to be clear that, when we take a look at, you know, our third quarter, both the endpoint and advanced segment had pretty significant growth. Actually, you know, relative to the midpoint of our guide, the upside for us really came from that endpoint segment, which, you know, is PC ecosystem content, as well as Hyve, as Marshall had talked about earlier. You know, when we look into fourth quarter, we see an overall reasonably healthy environment as well. We really feel pretty comfortable relative to, you know, the execution, you know, in each of our segments as we move into fourth quarter. Marshall, I know that you have some particular ASP and unit volume information you wanted to share. Yeah, Ruplu, on the PC ecosystem for our distribution network, it's not an exact science, but if we look at our third quarter results, volume was probably in the low- to single-digit growth rate, and ASP was probably in the high single- to low double-digit growth rate. All in net-net, we grew in the PC ecosystem business. I think... [crosstalk] Ruplu, what's gonna happen through time is that, you know, those ASPs, you know, will probably start to abate or come down in the US, you know, probably not in the not too distant future. There will be some moderation there. You know, Europe is a little bit more tricky to figure out from an ASP perspective. We all know that, you know, things might start to abate from an inflationary perspective, but, you know, the currency hockey stick, weakening of the euro is sort of a second dimension that manifests itself in increased ASPs. As we know that, you know, that industry is pretty much a dollar-based industry, so it takes a lot more euro to buy sort of the PC category. You know, I think that ASP dynamic in Europe might have a bit longer of a life relative to, you know, what we might see in other jurisdictions. Okay. Thanks for that, Rich. I appreciate all the details. Can I ask you had also talked about solutions aggregation and integration as a new opportunity for the combined company. When do you think that materializes? Is this like in the next 12 months, or is this an opportunity that is longer term? What type of investments do you need to you know see the revenues material revenues from that opportunity? Yeah, very, very good question. If you go back to our investor day, we talked about, you know, solutions aggregation being a build in 2022, 2023, 2024. We're well underway relative to, you know, aggregating multi-vendor solutions in our cloud marketplaces. You know, this happens quite frequently, and we also have been building a whole inventory of what we call click to run solutions. These are pre-configured solutions that we make available on our cloud platform. You know, that's a ramp. Certainly, that helps to accelerate our overall cloud platform growth. Typically, the margin profiles of aggregated solutions are better than point product sales overall. You know, it's a build, to answer your question, 2022, 2023, and then into the future. It is a critical element of, you know, strategically driving our cloud growth going forward. Of course, as you know, I think we said in late 2024 or 2025 timeframe, you know, we really move into sort of this orchestration model. We're building out all of those platform capabilities. To answer your last question, the investments that have to be made are in resources, engineering resources to qualify these aggregated solutions, certainly more technical sales resources. The last piece is the investment in the platform, which is. It has been all lined up, but we've been continually incrementing those investments as we move, you know, over time. Okay, great. Thanks for all the details. Appreciate it. Yeah. Your next question is from the line of Ashley Ellis with Credit Suisse. Your line is open. Hi. Thank you for taking my question. I was wondering if we could go back to guidance and look at it on a sequential basis, you know, using kind of our estimated historicals. It seems like growth is slower than usual for the fourth quarter. Marshall, could you maybe give us kind of like what are the headwinds, what are your expectations for currency? Are you expecting kind of a step down in Hyve at the low end of the range? And then if I kind of interpret the comments on backlog, is it fair to assume that, you know, maybe third quarter benefited from PC backlog coming down, but in fourth quarter you think overall backlog will stay flat? Just anything to kind of bridge us to the 2% growth in the fourth quarter. Sure. I'll start and then let Rich also touch on whatever you want, plus backlog. You do think about the sequential relationships, Ashley. We did have a strong third quarter, and that does make the compare to fourth quarter a little bit more unusual. Typically, we'll see a 5% to 10% revenue growth rate. At an 8% constant currency is kind of right in the middle. I think that explains some of the relationships. If you think about the headwinds, we did call out FX continuing to be impacted by the euro. We're guiding at 1.01%. It wasn't that long ago when we were at 1.18% or 1.19%. That continues to have some headwinds for us. I did mention in the conversations around Hyve, when we do guide, we typically go towards the lower end of the Hyve outcome and the ranges. But with that said, we still expect year-on-year growth within the hyperscale infrastructure, high growth technology business, as well as solid growth in the distribution networks, whether it's Asia Pac, Europe, or Americas. Rich, don't know if you have anything else you want to add to that. No, thank you, Marshall. That's quite comprehensive. Okay, thank you. Looking at your merger synergies, I mean, typically both companies have always kind of overperformed, outperformed and generated more synergies. Do you see room to raise that $200 million target? Kind of as the macro environment is weakening, how are you thinking about your spending? Would you maybe consider, I know you're keeping, you know, Asia and Europe on their own ERP systems. Is there maybe opportunity to move those to the same system? Kind of, maybe like a plan B in the event that we go into a recession, how are you thinking about spending and synergies? Yeah, I'll touch on synergies. You're right, Ashley. We have typically overperformed our synergy targets, not only earlier but higher. Right now, as you saw in our prepared remarks, we're at $140 million, so that stepped up $10 million from the last time we spoke. We still are confident in the $200 million of synergies as we exit the second year. But I do also believe that as we get closer to this year-end and kinda do a bottoms-up thought for all of fiscal 2023, we'll probably have more informed conversation on what that outlook may be. For now, the $200 million is a good number to use. Yeah. On the back end on the ERP systems, we've got a lot of work to do in the US in particular now. We're in the middle of that, migration from the legacy Tech Data ERP onto the CIS system. You know, we are steadfastly focused on that. The plan was that we would maintain our ERP systems outside of the US, and then keep everybody all hands on deck because, you know, we're going to have a combined $40 billion entity. Want to make sure we aren't distracted and get that done properly. Sometime down the road, you know, we will carry out an evaluation to determine whether there are future changes to the ERP or whether it makes sense the way we're aligned right now. Okay. Thank you. Thank you, Ashley. Have a great day. Your next question is from Adam Tindle with Raymond James. Your line is open. Okay, thanks. Good morning. I guess I wanted to start on EMEIA since you cited strength in Europe as a reason for the mid-teens non-GAAP operating income growth and constant currency during the quarter. I think that's probably surprising to some people. So maybe you could comment on the cadence of demand there and what you're seeing here at the end of September in the EMEIA region. There's just so many macro headlines on recessionary fears, you know, and everything related to that. Just wondering what you're learning real-time there, the cadence of demand through third quarter, real-time in September, and what's embedded in your guidance for fourth quarter for Europe. Yeah. Adam, I'll start, and then Rich, you can chime in. From a cadence standpoint in Europe, Adam, what we saw is year-on-year by month, it strengthened. We saw continued strength in August, and our guide continues to reflect that confidence as we think about fourth quarter. It is. I don't know if the word is surprising, but it is definitely something we didn't expect to see that kind of strength continue and grow. Speaking with our European teams, you know, they do the same thing that the rest of the world does. They do bottoms-up analysis and forecasts and are quite convicted looking at the overall macro backdrop plus the supply chain issues and their demand to come up with our thoughts around fourth quarter. Rich? Yeah, Adam. So first, a little bit of a pleasant surprise. Actually, when we take a look at the entirety of the channel, it had a mid to slightly higher single-digit growth rate overall. From memory, Marshall correct me if I'm wrong, but I think that we, relative to the visibility that we had, grew substantially higher than that. You know, our business has strength in Europe. As Marshall has stated, you know, for the coming quarter, we sort of build bottom-up and have a good visibility from a country perspective. You know, the aggregate of that is a pretty robust outlook, if you will, for fourth quarter as well. You know, we, like you know, read the headlines relative to the challenges in Europe, yet technology seems to you know, be a solution to help in driving some efficiencies for you know, a lot of business entities. I think that you know, we always talk about the fact that when things are tough you know, IT outpaces GDP. I just think my own personal opinion is that it's such a useful tool and is a necessary tool in order for businesses to remain competitive going forward that there seems to be you know, I'll call it more consumption than historical levels. You know, how long will that hold up is yet to be seen. You know, right now, you know, we see a pretty solid environment in the third quarter and, you know, as part of the projection in the fourth as well. Okay. Maybe as a follow-up, Marshall, on cash flow, it's just been, you know, volatile since the merger. I look at it here, you're talking about an inventory build. I understand the Hyve component, but you did say the majority of t hat build is related to the distribution business. Kind of trying to figure out what got you comfortable letting inventory days continue to extend in the core distribution business given you have a softer guide for forward growth. You know, those kind of odd dynamics. You know, you usually have a more robust forecast for forward growth as you let inventory days grow and the timing for that to flush out. Maybe just lastly, not to build too far on this question, but I think cash flow is just so important given the targets that you have out there for this medium term. You know, any kind of structural dynamics you can talk about outside of the cyclical inventory days, you know, on payables and receivables here. You know, there's a lot of offsetting factors, and I'm wondering if there's temporary benefits. You know, how we think about kind of the normalized structure and normalized cash conversion cycle beyond the inventory day. Starting with the inventory cyclicality aspect and then the structural aspect of how the business will generate $1 billion plus in cash flow next year. Yeah, sure. I'll start, and then Rich can certainly chime in as you've got other comments or. We still expect to generate $1 billion in free cash flow in 2023, assuming a stable supply chain environment. Just want to make sure that you understand that. Just going one level down or clicking into that, in third quarter, our inventory did go up by over $1 billion. As we said, both for distribution and Hyve, those reasons. AP offset that for the most part. As I said in my prepared comments too, Adam, inventory should, and we expect this to translate to revenue and profit generation in fourth quarter and beyond. There's obviously volatility in supply chain. There's some temporary effects and delays in our cash flow. Thinking back and just looking at our seasonality, we just finished our first year around the sun together. It does give us a sense of what cash days do. If you look at last year, we finished at 15% in cash days, and now we're at 23%, so up 8%. What caused that? Basically the split 50/50 between, we'll call it Hyve infrastructure and distribution. We do think that that starts to abate and unwind in fourth quarter into 2023. But at the end of the day, it really does come down to the overall certainty or volatility around supply chain and how that manifests itself into 2023. Rich, anything else you want to add? Yeah. So Adam, I want to make sure everybody understands that it's not lost on us the importance of free cash flow and generating free cash flow. As I think about it, a big part of this has been due to the volatility, you know, the ups and downs of the, you know, prior pandemic, et cetera. You know, I actually went and carried out some analysis to take a look across our vendor base and look at what's happening with their inventories. You know, largely speaking, they're elevated, you know, pretty materially, as an aggregate group. Again, I think that's just the manifestation of, you know, trying to manage the shorts and longs, you know, through what we've been through. You know, that being said, I fundamentally believe that moving forward, we will find our way to our profile in cash stance. We do start to, as I said earlier, see stability within the PC ecosystem. You know, so there's less, I'll call it erraticness. You know, it might be a little bit bumpy in the AS space for the, you know, first couple of quarters of next year. I think that, you know, we find a pretty good groove as we move through the year. Yeah. I'd say correct that they're elevated, but we have all the confidence that we can manage to profile once we get, you know, some of these, sort of some of these challenges around the supply chain settlement. Thank you. Your next question is from Vincent Colicchio with Barrington Research. Your line is open. Yes. A lot of questions on cost synergies. I'm curious, are you seeing any meaningful revenue synergies? Just what are your thoughts there? Yeah. Again, on the revenue synergies, we clearly have a lot of opportunity around revenue synergies. As we move into a common ERP system, they become a lot more executable, you know. Because you have all of the vendors that one side had that the other side didn't, that you can take advantage of. I'll say it's the vendors. You know, I believe that as we get to sort of the start of next year, there'll be a ramp. As we move through the year, we'll be able to take more advantage of that, cause we'll move more towards being on that one ERP system. You know, have all the training done, not only on the ERP system, we're in the middle of that now, but also the cross-training that happens with the vendors that one side had that the others haven't. You know, all of that will sort of be a, you know, I'll say fiscal year 2023 activity and ramp. We definitely see that opportunity ahead of us. Obviously in the middle of a large integration. Yeah, if we move into a meaningful recession here, should we expect you to be opportunistic perhaps on smaller deals? I'll go first on this. You know, I think given our history and experience, and if you're talking about actual inventory buys or you're just talking about M&A opportunities, Vince? I want to make sure I answer... [crosstalk] The latter. M&A? Yes. Yeah. I would say regardless of economic environments, I think we've been pretty steady in our ability and appetite to look at deals that are appropriate and value added, whether it's a footprint expansion or a capability expansion. Rich? No, I think that's right. I mean, we're frequently around the table with our strategic teams looking at you know, pipeline, if you will. You know, we believe we have the balance sheet if we see the right set of assets to pursue them. I think that although the market would articulate that there's a buying opportunity, you know, just based on the way multiples are rolling, I think people are still of the realization of, "Hey, I was here, and you know, I'm still worth where I was." You know, some of that test of time will have to pass. You know, again, I think that our company will continue to be acquisitive as the two companies previously have always been. You know, it's a matter of just finding the right assets and being patient to, you know, make sure that you find things which are complementary to your business. Thanks, guys. Thanks. Well, thank you. Your next question is from Alek Valero with Loop Capital Markets. Your line is open. Hey, how's it going, guys? I'm actually on for Nanda. My question is, so are you guys seeing any impact from pricing broadly? If pricing were to come down, would you see any impact to margins? Maybe I'll start there. You know, we still are living in environment of either price stability or ASP increases. You know, certainly we have a long history of seeing those things ebb and flow through time and, you know, can't predict when, but, you know, I think in time, you know, prices will either be stable or start to decrease. In the instance when those prices start to come down, you know, typically we have the opportunity to retain our margin profile because, you know, we take on that inventory at a particular, you know, at what the vendors are selling it to us for. Typically we're able to hold our overall margin profile. Marshall has commented that in a escalating ASP environment that we've seen in the past, that we've benefited somewhere around 10- basis points. You know, that's starting to slow down a little bit because there's not as much activity. There's a bit of a smoothing happening there. You know, as we move forward, we would expect that, you know, the margin profile of the business would stay reasonably stable, you know, regardless of the price either increases or decreases. Thank you for that. Maybe as a quick follow-up. For your key product areas, do you guys have any sense of which areas are becoming softer and maybe stronger? Maybe if you could expand by geography as well. Alek, was the question about where we're seeing strength and weaknesses in our product capabilities globally? Yeah, that's right. Your product areas. You know, I'll start with this. I mean, we in third quarter had seen uniform strength across all of our major product categories, basically in every region. You know, there wasn't anything that surprised, if you will, to the downside, which, you know, frankly, it might be a bit unusual. You know, as we had, I think, commented earlier, if you think about our adjusted revenue at 15% in third quarter and, you know, the midpoints of the guide in fourth quarter being sort of 8.5%-ish overall, you know, there isn't anything that's really falling out. Rather, you know, I think it's a fairly uniform view of, you know, I think the revenue growing in each of the categories going forward. Maybe a little bit less growth in the Hyve business unit, but the other ones are, you know, I think pretty good. I mean, high single- digits is pretty good in my book. You know, there isn't a particular area that I would say that we would report in third quarter as being weak. Awesome. Thank you for that. Your final question comes from the line of Jim Suva with Citigroup. Your line is open. Thank you so much. We know that from the past, the Hyve business has had some, you know, big builds and then some inventory digestion or some unpredictable linearity in it. As you sit here now running your company and look at the demand from it, is that business at an equilibrium point? Or I know it was just a big quarter, is there some inventory digestion that has to occur from where you sit and see things? Jim, yeah, it still remains fairly lumpy. As we've said, to give it a little bit broader perspective on a, call it a trailing twelve-month basis or year on year, both revenue and operating income continues to grow in that space. One thing we did mention earlier, Jim, is that there is some capacity constraints with our hyperscale data center customers where their demand is greater than their ability to absorb. What we do is we have our racks or the racks that we've customized for our hyperscaler customers sitting in kind of a ready-to-go position. It's inventory on our books until they accept it, and then it translates to revenue, and then we're, you know, it's through the cycle. That has built up over the first three quarters of this fiscal. I think that's one thing that as that normality comes into play or equalizes in 2023, we may see inventory related to that start to come down. Okay. That makes sense. And then... [crosstalk] [inaudible] Oh, go ahead. Jim, I was just gonna say it's more of a reminder that for what we do in that space around our hyperscale customers, we do get paid for holding that for them until they're ready to digest. It's not the inventory that isn't being recovered from a margin perspective. Okay. That makes sense. Can you remind us again of your PC percent of total company exposure, maybe in totality, and then the breakdown of consumer versus enterprise, and then maybe Europe versus US? Because it just seems like there's a lot of changes that are on the come for Europe versus US. Yeah. Let me answer the global question. Marshall can keep me honest. We talked about this a little bit in the last earnings call. The PC exposure overall is sort of low 20% of total revenue or portfolio. The consumer piece is sort of the mid-single digit of the total portfolio percent. I don't know, Marshall, do you have the facts relative to Europe versus the Americas? I think they're reasonably balanced, right? Yeah. I think they are. It's fairly equal. Yeah. So, there isn't a strong concentration in one versus the other. One caveat to that, in Europe, you know, we have a mobility business with one of the top tier mobility vendors. You know that if you were to consider the mobility within PC, then there might be a bit of a, you know, a larger concentration in Europe. That mobility business is quite healthy right now. That's primarily commercial. It's primarily commercial. That's right. Please... [crosstalk] Actually, in Europe, that mobility business serves sort of the broad market, commercial and consumer. Okay. Great. Thank you so much for the clarifications. Thanks, Jim. Thank you for your participation today. This concludes today's conference call. You may now disconnect. Have a nice day.