Ladies and gentlemen, good morning. My name is Abby. I will be your conference operator today. I would like to welcome everyone to the TD SYNNEX First Quarter Fiscal 2023 Earnings Call. Today's call is being recorded. 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 future fiscal periods. 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, thanks for joining us today. Our flexible business model and broad industry-leading portfolio allowed us to capture growth in Q1 across Advanced Solutions and high-growth technologies despite a rapidly changing market environment. Our team showed the ability to execute well, remaining flexible to market conditions and pivoting to areas of growth. This allowed us to grow revenue for the quarter on a constant currency basis, expand margins, deliver non-GAAP EPS growth towards the high end of our previously guided range, and return meaningful cash to our shareholders. Relative to our expectations, the macroeconomic environment impacted demand for PCs and related products during the quarter, and the market declined in North America more sharply than we had forecasted. From a regional perspective, the demand declines in both Europe and Asia Pacific Japan were less pronounced. Looking forward, many of our top vendors indicate that we could anticipate a more stable Endpoint Solutions portfolio in the second half of the year, with drivers such as the post-pandemic refresh cycle and the government and education spending season fueling PC demand. Nevertheless, this quarter highlighted the strength of our strategy to invest in diversifying our portfolio. Our investments across data center and networking infrastructure, along with the build-out of a robust set of offerings for hybrid cloud, cybersecurity, data analytics, and hyperscale infrastructure are paying off, and we are pleased with the momentum we continue to see in those categories in Q1. In total, our basket of high-growth technologies, including Hyve, grew in the mid-teens for the quarter. This growth highlights the strategic importance of these projects to our customers and their end users and is aligned with our longer-term growth rates we've discussed previously for this category. Overall strength in Advanced Solutions and high-growth technologies helped to offset the declines in Endpoint Solutions. The overall business saw 4% constant currency growth in gross billings in the first quarter. It is worth noting that IDC and CONTEXT reports for North America and Europe that we use to track our distribution market participation indicate the overall market share in those regions grew in fiscal Q1. From a supply chain perspective, we continue to see improvement in the quarter. We experienced decline in our backlog across the board quarter-over-quarter. While there remain a few isolated areas of constraint, our overall backlog levels are approaching historical levels. The normalization is a positive sign as a more balanced supply chain environment allows us to serve the demand for our customers in a more timely fashion. We continue to make excellent progress on our ERP systems migration, and as I've mentioned previously, we deliberately have taken a measured and steady approach to reduce the risk of disruption to our customers and vendors. I'm pleased to report that more than 75% of our North America distribution business is now transacting in CIF. Customer and vendor sentiment around the transition has been positive, and we will continue to migrate the remaining portions of our business throughout the year. Also during the quarter, we were very proud to publish our first corporate citizenship report, demonstrating our commitment to being a responsible corporation. We have set clear environmental and social goals as described in the report, and we look forward to continuing to update you on our progress in these important areas. As we enter the second quarter, which is our seventh post-merger quarter, we are confident in our ability to navigate the rapidly changing market dynamics in our industry. We believe our variable cost structure, diversified portfolio, and commitment to investing in high-growth technologies allows us to succeed in any market condition. In closing, we expect to see a continuation of the trends we saw in the first quarter play out in our fiscal Q2, with demand for Endpoint Solutions likely seeing continued pressure and opportunities for continued growth in Advanced Solutions and high-growth technologies. We are confident in our ability to navigate the dynamic environment by leveraging our broad portfolio to pivot towards pockets of growth and margin expansion. I'll now turn it over to Marshall for some additional comments about Q1 and our Q2 outlook. Marshall, over to you. Thanks, Rich, and thanks to everyone for joining us today. Before I review our quarterly performance, I wanted to highlight a new measure that we introduced in our filings today. Beginning this quarter, we have added gross billings as one of our disclosures. We believe gross billings is an important metric to consider when evaluating our business, as it represents our total book of business, including the sales that get netted down in the reported revenue line. As a reminder, for many of our virtual offerings across software, cloud, and security, the net revenue we report represents only the gross profit we earn for the services we have performed. Thus, the totality of growth across those businesses is not captured in the reported net revenue line. As a larger portion of our revenue moves to software and services that will be reported on a net basis, we believe providing gross billings and the associated growth rates will allow investors to fully appreciate underlying trends in the scope of our business. This new disclosure was also in response to requests from our investors who value this metric from a reporting perspective. As you heard from Rich, during the February quarter, we saw softer than expected demand across several Endpoint Solutions technology categories, particularly in North America. Despite this additional pressure, our broad, diversified portfolio, coupled with our focus on margin-accretive high-growth technologies, allowed us to grow gross billings and revenue on a constant currency basis and expand margins despite the lower than expected revenue growth in the quarter. Moving to Q1 results. Worldwide Gross Billings came in at $20.2 billion, up 1% year-over-year, and up 4% in Constant Currency. While net revenue was $15.1 billion, down 2% year-over-year, and up 1% in Constant Currency. From a regional perspective, Americas revenue declined 4% year-over-year, while Europe increased 5% and APJ increased 26%, all in Constant Currency. In Americas, we saw significant deceleration in demand for Endpoint Solutions products, partially offset by strength in Advanced Solutions and high-growth technologies, including Hyve. In Europe, the growth came from outperformance in Advanced Solutions, partially offset by less severe declines in Endpoint Solutions. In APJ, the region outperformed our forecast, driven by growth in Advanced Solutions, services, and high-growth technologies. Non-GAAP gross profit was $1.01 billion, which is our second consecutive quarter greater than $1 billion, and non-GAAP gross margin was 6.68%, up 26 basis points year-over-year. The improvement in gross margin was driven primarily by an increased mix shift to Advanced Solutions and high-growth technologies. Total adjusted SG&A expense was $568 million, representing a 3.8% of revenue. Non-GAAP operating income was $443 million, up $11 million or 2.6% year-over-year, and non-GAAP operating margin was 2.93%, up 14 basis points year-over-year, primarily driven by increased mix shift to high-growth technologies and cost synergy attainment. On a constant currency basis, non-GAAP operating income increased 5% year-over-year. Quarter one non-GAAP interest expense and finance charges were $78 million, $5 million above our outlook. For Q1, the non-GAAP effective tax rate was approximately 23%. Total non-GAAP net income was $279 million, and non-GAAP diluted EPS was $2.93, which was at the high end of our previously communicated guidance range for the quarter. Turning to the balance sheet. We ended the quarter with cash and cash equivalents of $539 million and debt of $4.4 billion. Our gross leverage ratio was 2.4 x, and net leverage was 2.1 x, which is in line with our investment grade profile in approaching our previously communicated target of two times gross leverage ratio. Accounts receivable totaled $9.36 billion, down from $9.42 billion in the prior quarter. Inventories totaled $8.37 billion, down $694 million or 8% from the prior quarter. Net working capital at the end of the first quarter was $4.2 billion, an increase of approximately $390 million from Q4 due to seasonal trends. The cash conversion cycle for the first quarter was 26 days, up three days from quarter four. Cash used in operations in the quarter was $103 million. From a shareholder return perspective, for the current quarter, our board of directors has approved a cash dividend of $0.35 per common share, payable on April 28, 2023 to stockholders of record as of the close of business on April 14, 2023. During the quarter, we paid $33 million in dividends and continued executing on our share repurchase program by buying approximately $115 million of our stock. We have approximately $900 million remaining on our three year share repurchase authorization and expect to continue further share repurchases through the year aligned with our cash flow generation. We continue to make good progress on the remaining merger-related cost synergies, recognizing an additional $25 million in the quarter, and to date, we have achieved over $170 million of our total $200 million target. Moving to our outlook for fiscal quarter two. As Rich had mentioned, we expect to see a continuation of the trends we saw in the first quarter with a stronger weighting towards Advanced Solutions and high-growth technologies. We expect gross billings of $18.7 billion-$20 billion, approximately flat on a year-over-year basis in constant currency at the midpoint. We expect total revenue to be in the range of $14 billion-$15 billion, which equates to a year-over-year decline of approximately 4% on a constant currency basis at the midpoint. The 4% decline in net revenue is driven by incremental growth to net adjustments year-over-year as we continue to grow in Advanced Solutions and High-growth technologies. This outlook also reflects the impact of year-over-year foreign exchange headwinds of approximately $200 million to revenue and $250 million to gross billings. Our guidance is based on a euro to dollar exchange rate of 1.07. Non-GAAP net income is expected to be in the range of $214 million-$261 million, and non-GAAP diluted EPS is expected to be in the range of $2.25-$2.75 per diluted share based on weighted average shares outstanding of approximately 94.2 million. Non-GAAP interest expense for quarter two is expected to be approximately $76 million, and we expect the tax rate to be approximately 24%. Our guidance is inclusive of headwinds year-over-year from interest expense and euro devaluation, which collectively represent a $0.27 per share headwind to non-GAAP EPS versus quarter two fiscal of 2022. Excluding these discrete items, our outlook implies non-GAAP EPS growth of approximately 2% at the midpoint as our underlying business continues to perform solidly. Regarding our thoughts for the full year of 2023, the market continues to be volatile, which may impact our business. We believe that our differentiation in the market and ability to pivot to pockets of growth is clear in our performance this quarter and in our guidance for Q2. We are seeing stable and consistent margins to the fiscal year outlook we provided last quarter and continue to feel confident we will deliver on our previously guided $1 billion-plus in free cash flow, a large portion of which we expect to be returned to shareholders through continued share buybacks and dividends. I will now turn the call back over to the operator to begin the Q&A session. Operator? Thank you. If you would like to ask a question, please press star one on your telephone keypad. If you would like to remove yourself from the queue, press star one a second time. We do ask that you please limit yourself to one question to allow time for other participants to ask their questions. If there is time remaining, you are welcome to re-queue with additional questions, we will pause for just a moment to compile the Q&A roster. We will take our first question from Keith Housum with Northcoast Research. Your line is open. Good morning, guys. I appreciate the opportunity here. In terms of the strength that you saw in Europe and Asia Pacific specifically, Marshall, can you please perhaps talk a little bit about some of that strength? Are you guys taking share there? Is there a feeling of that, or is it just the market there stronger than what you're seeing here in North America? Yeah. Keith, Well, first of all, good morning. Thanks, and thanks for the question. Absolutely. I'm ready to jump in right away. First, in our prepared remarks, I had commented on market share in Europe and North America, absent APJ. The reason for that is we don't have a service in APJ that readily reports the market position. Clearly, as stated in the remarks, we feel as if we've grown our market, participation in North America and Europe. Obviously, the top line, revenue strength in APJ, was quite good. That's That's the first point. If I were to characterize the European performance, you know, we have this theme for our company globally where we had said that we had a declining endpoint, and we had growing Advanced Solutions. In Europe, on the endpoint, let me just say that it declined less, and on the Advanced Solutions it grew more. You know, part of the endpoint, declining less is due to the mix of that endpoint segment. You might recall we have mobility as part of the endpoint segment in Europe as an example. Therefore, some of those things in terms of the mix to the endpoint, were why we had declined less. That's really the major overlying theme. Okay. Appreciate that. Marshall. Real quick. Keith, one thing that you'll see in the in the press release on the regionals is that op income for Europe did decline. That was more about high-growth technology tough compares year-on-year. Okay. Appreciate that. Just following up, Rich, on that endpoint device commentary there, you noted that the vendors expect a second half improvement in endpoint devices. I guess my question is, do you and your customers agree with that assessment that you'll see an improvement in the second half? I would say that generally, yes. Keith, there's a couple of parameters here that I think are important. First, if you think about the government buying season, what we had experienced is that, you know, in the prior year there was a pretty tepid government spending season because of the huge COVID purchase the year or two before that. We believe there'll be a rebound there. The second is, you know, we all know about the post-pandemic refresh cycle and Windows 11, so we'll start to see some of that kick in. The third is, you know, candidly, the back half of the year is the, you know, was when the declines had begun, so the compares are easier. You know, they basically will begin to wrap, you know, starting in the third quarter. Quarter ... overall. All right, guys. Good luck. Thank you. Appreciate it. Thank you, Keith. We will take our next question from Sameer Kalucha with RBC. Your line is open. Hi. Can you hear me okay? Yes. Okay, great. Thanks for taking the question. When you give the guidance for the full year last quarter, the outlook was underpinned by a flattish GDP outlook. I was curious what are your views on GDP from where we are right now, given the market conditions are a little bit different from what we saw in the beginning of the year? That's number one. Number two, given all the rage about new technologies like Generative AI, I'm curious how big are they as part of your portfolio in the high growth solutions in AI ML part, and how do you expect them to drive growth going forward? Thanks. Yeah. Well, thank you for your comments. First, as it relates to GDP, as you're well aware, I mean, I think there's been some real time events that have played out in the last couple of weeks that probably aren't yet reflected in the reports that exist, you know, for GDP. We'll have to wait and see, you know, when those things flow through and the economists do their job as to what that outcome might be. You know, last reported, we thought that GDP in the markets that we participate would be flattish, so, you know, we'll see where things go from there. On your second question, when we think about our strategy, we talk about high-growth technologies, which includes hyperscale infrastructure, cybersecurity, and then data and analytics. Data and analytics, at its core becomes, you know, the foundation, if you will, for a lot of the AI work that's going on. I would say sort of looking backward, the predominance of our sale has been more around analytics, you know, pure analytics. We now see the emergence of artificial intelligence, although it really hasn't become a material or meaningful part of our entire revenue stream or portfolio yet. My experience has been that when new technologies emerge to the market, they'll manifest themselves in first-of-a-kind offerings first, and then through time they get packaged and make their way down through, you know, what I'll call the medium or smaller customers, which is where most of our engagement, you know, with our, our customers is directed. As you well know, when you get into AI, it's all about, you know, the data and the accuracy of the data. My expectation is we might go through this similar cycle of being deployed first as custom projects and then, you know, making its way into packaged solutions. I believe that whole development cycle will be greatly condensed, you know, given the emergence of a lot of the new artificial intelligence in the market. Got it. Thank you. We will take our next question from Joseph Cardoso with JPMorgan. Your line is open. Hey, thanks for the questions, guys. Just one for me. You know, we've seen some positive data points in the PC supply chain over like the last one to two months at least as it relates to inventory levels. Just curious to hear what you guys are seeing as it relates to channel inventory. Just on the demand side, you suggested some of your partners suggesting a recovery in 2H on those various, kind of data points. You know, are you actually seeing any of that to date in at least conversations that you're having with your customers, or should we think about that becoming more tangible later in the year? Thanks for the question. When I had discussed the PC ecosystem earlier off of Keith's question, you know, I had left out the fact that there was a lot of visibility brought by vendors broadly to, you know, I'll call it extra inventory within the channel. You know, fundamentally, or I should say anecdotally, I believe that's true. We don't have visibility with precision with regard to all of the inventory that's held by our sellers. Anecdotally, the evidence, you know, was there through the discussion, we were led to believe that, you know, there was an inventory work down. I do believe that that's part of, you know, the realignment, if you will, for the second half of the year. To answer your question explicitly, have we seen the green sprouts yet? No, we haven't. You know, I do believe they're months ahead as opposed to beginning currently. Got it. I I appreciate the color. Thanks. We will take our next question from Tim Long with Barclays. Your line is open. Tim, your line is open. Please check your mute button. Sorry about that. Sorry about that. Two questions here, if I could. First, if you could talk across the device business and the advanced technologies businesses, the impact of pricing and price changes. Obviously, PCs were inflated. If you look at, you know, the server and storage market, we're seeing pretty meaningful memory cost declines. Curious if you're starting to see any of that showing up in your numbers. Secondly, maybe Marshall, if you can talk a little bit about cash conversion cycle and how we think about that through the rest of the year. Thank you. Okay. I'll thank you for the question. I'll handle part A and then Marshall, part B. This varies a little bit by region, but we have seen price activity in PC, you know, given the supply situation we spoke about earlier. Expectation is that as supply stabilizes, that there'll be lesser activity, if you will, around the PC segment. We have, consistent with your thoughts around some of the commodity prices coming down, which obviously are a big part of the bill of materials within Advanced Solutions. We have seen price activity begin to emerge. It's been a good long time since we have seen that. Yes, there has been price reductions and, you know, we would anticipate price reductions as the flow through of those commodities, you know, occur. The other question that should go along with that, you know, kind of put it in the category of too early to tell is a lot of times when these commodity come down, the ASPs get held while customers take, I'll call it more rich configurations. You know, the question will be, you know, will we see that or will we see, you know, customers, you know, given the economic circumstance, accept leaner configurations? Don't have enough evidence or information on that yet, that's something that, you know, probably will play out in the next 90 days. On the cash conversion cycle question you saw for quarter one, we were around 26. I expect that to improve by two days in Q2 to about 24-ish. Similar to what we had said at the beginning of the year, I do expect that to continue to decline or improve for the rest of the fiscal. Ideally, if we can get to around 20 days-ish, that would be great. In my comments you saw, we did reiterate the confidence around our free cash flow being at $1 billion+. We still feel given the working capital improvements, the earnings power of the organization, an assumption that supply chain remains stable and that inventory channels continue to clear, I think we're gonna be good to hit that. Okay. Thank you, guys. Thank you. Thank you. We will take our next question from Ruplu Bhattacharya with Bank of America. Your line is open. Hi. Good morning. Thank you for taking my questions. Rich, it looks like you had another strong quarter for Advanced Solutions, and that probably also benefited margins. How much did Advanced Solutions benefit from backlog reduction in the quarter, and what do orders look like? If Advanced Solutions weakens in the second half, what would the margin trajectory look like? Do you see the need for incremental cost structure changes? Lots of questions there. Let me take it one at a time. First, certainly I do believe that as the backlog has been running down, that it has assisted in our growth for Advanced Solutions. Second, when you think about when Advanced Solutions really began to have higher growth rates overall, it approximately was, you know, in the back half of last year. Therefore, the compares in the back half will be a bit more challenging for Advanced Solutions. We would expect that, you know, the growth rates wouldn't be as they were previously. You know, as it relates to cost actions, you know, we've talked on the last couple of calls relative to us being very focused in every region of the world to make sure that we're being very prescriptive as it relates to all of our discretionary spend, all of our new hire spend, and ensuring that, you know, every single dollar is measured. We look at and think about our cost structure on a continuous basis and, you know, we'll look forward to understand the ebb and flow of economic change and adjust accordingly as we think about the back half of the year. That's the way, Ruplu, we think about it. Thanks for the question. Okay, Rich. Thanks for the details there. Marshall, I have a question for you on ROIC, but before I ask that, I just wanted to ask a clarification. Maybe I missed this, but last quarter, you had talked about full year 2023 revenue growth to be 3%-5% on a reported basis. Did you confirm that also for in this quarter? I may have missed that, if you can just clarify that. My question on ROIC is, I guess you've reported 10.6% this quarter. A year ago, it looks like it was in the mid-teens. It may not be an apples to apples because maybe it wasn't on a combined company basis. You know, the target of 2%-4% above WACC, I mean, what needs to happen for you to get to the high end of that ROIC range? How should we think about ROIC in the long term? Thanks. Sure. I'll address the ROIC first, Ruplu. The mechanics around how that's calculated is we do a five quarter average so that as we have come further away from the merger, invested capital continues to grow, so the denominator is growing, which is expected. The 10.6 is in line with our expectations. To your question on WACC, I mean, clearly, interest rates have increased, so that has increased our WACC. We're at a WACC of roughly around 8.5%-9%, A lot of that again is just due to rising interest rates. It hasn't changed our overall requirement of returning 200-400 basis points above our weighted average cost of capital. That continues to be the threshold that we look at when we make investments in the business and we make investments externally in terms of M&A opportunity. To touch on the question about what we gave guidance for and what we didn't, you're right, we did not give guidance for revenue for the second half of the year. A lot of that has to do with what Rich said in his prepared remarks, just around the uncertainty and volatility that we're currently experiencing. We certainly want to see this quarter play out, see how it does, and then come back with a rethought for our guidance as we get into the end part of Q2 and into Q3. Okay. Thank you for all the details. Appreciate it. We'll take our next question from Adam Tindle with Raymond James. Your line is open. Okay. Thanks. Good morning. Marshall, I wanna expand on that guidance point that you just made. I understand, you know, maybe not expanding on the revenue piece of it, but stripping out gross versus net and all that sort of stuff and just looking at the actual earnings of the company, I think you would have come to a conclusion of an earnings for around $12 for the year based on your comments of 3%-5% growth, 2.6%-2.8% operating margin. That's kinda where we all landed for the year. Obviously you're tracking below that on a year-over-year basis for the first half of this year. Just wondering maybe we could switch that question to more of an earnings question to see, you know, what has changed since you last gave that guidance. You know, if we look at the current run rates, we're probably gonna be closer to low 11s in terms of the earnings for the year. Is that, you know something that makes more sense to you based on what you're seeing right now? Thanks. Yeah. I'll start and then allow Rich to provide commentary. I think we'll start with just what we said about what we experienced in the quarter. You know, Endpoint Solutions softer, and down on a year-on-year basis in the majority of the regions that we perform. I think revenue itself is probably the biggest driver of, we'll call it the operating income decline. As we said, we feel good about the margin profile and structure of our business being in that 2.6%-2.8% range. We like the position of where we're at strategically within the organization. We're proud about the market share that's either at or better than what it was. To us, it certainly implies that during these uncertain times, our position in the market is allowing and providing for our partners to spend more with us and use us more as they're also trying to figure out ways to be more efficient in this uncertain economic situation. Rich, I don't know if you want to add anything else to that. The only thing that I'd add, and it's a bit repetitive, is that as Marshall had stated, the financial profile, and the engagement model, as it's been, as we talked about our market participation, I, you know, I think is very strong. You know, this is a more macroeconomic challenge as opposed to anything else, and with all of the uncertainty, we just don't feel comfortable with providing a view as with regard to 2H at this time. All right. maybe then as a follow-up, since that might create some volatility, Marshall, how you're thinking about capital allocation and cash flow, and I guess maybe more specifically, you talked about the $1 billion for the year, the cadence of that, and any kind of buckets that that's coming from, you know, how that should layer out through the remaining quarters and what gives you the confidence. Secondly, on capital allocation, I think you said it'd be aligned with cash generation. Presumably that's going to increase going forward, given you were negative in Q1 and talking about a $1 billion for the year. you know, might that translate to more share repurchase? Just how we can think about that would be great. Thanks. Sure. Yeah, I'll first answer the question just on the cadence of cash flow. Typically Q1, as you saw, tends to consume cash, is what we saw of just over $100 million. That begins to reverse itself, and as I mentioned on a previous Q&A, we think cash day improves probably two days in Q2. I would expect that probably to end up being similar improvements in three and four, Adam. I think you could think about it from that perspective of being positive cash flow on some form of equal basis, Q2, three and four. Thinking in regards to the capital and our allocation, overall goals and strategies, that hasn't changed. As you know, our cash flow and how we allocate that free cash flow between reinvestments back into business and returns back to shareholders, we still feel good about that 50/50 allocation. For 2023, our desire is to continue to stair step up to that 50% attainment, and hopefully we'll reach around 40% for 2023. As you had mentioned, and we've mentioned historically, it is certainly aligned to cash flow generation. We feel positive about where we expect to be for this year. If we do exceed our initial expectations, we certainly will look at opportunistic repurchases going forward. Great. Thank you. Thank you. We will take our next question from Matt Sheerin with Stifel. Your line is open. Yes, thanks, good morning, everyone. Rich, my first question, just another demand, you know, question. You talked about the weakness in North America. Could you drill down a little bit in terms of those various channels that you sell into, the large resellers versus VARs selling into SMB versus public sector and what you're hearing from those customers in terms of, you know, when they think stabilizing? The same thing on the Advanced Solutions side, because your comment was that it's growing, but not as strong as in Europe. Yeah. Thanks, thanks for the question, Matt. I'll share this with Marshall. I would tell you that, you know, I think that as we evolve through the year so far, we have seen a bit of a change in sentiment relative to our customers to, you know, words like a bit more cautious, words like, you know, things elongating in terms of the sell cycles. You know, I think that, you know, as the sort of the economic circumstance is playing out, there is a bit of a change in sentiment. That is what we see from, you know, the macro level. You know, as it relates to, you know, are we seeing any differences between particular channels, you know, I would say no, not so much. That, you know, that overlying sentiment seems to be fairly consistent. You know, Marshall, maybe you can provide some insights right from the numbers. Matt, when we look at our VAR allocation between public sector, large, medium, small, retail, and all the aspects that go with it, the percentage of those buckets have remained fairly consistent, which is great. SMB, as you know, is a very important aspect of our portfolio, and it stayed resilient throughout this market. I would say, as Rich said, across the board, there's probably just generally less spend on ES, but if you look at how we've been allocated, it stayed fairly consistent over these last two to three quarters. Yeah. The one exception from, you know, I was jogging my memory as Marshall was talking. I think we see government spend being a bit more robust relative to the other segments, that's sort of the only outlier. Okay. Great. If I could just sneak in a couple quick ones. One, it sounded like you said that Hyve was up double digits, so year-over-year, if you could clarify that and what you're seeing there. Then also on the interest expense line, Marshall, should we be, you know, modeling, you know, that, you know, closer to $80 million or so through the year? Or do you expect to work that down with your free cash flow and bringing down short-term borrowings or anything like that? Hyve for quarter one performed great, above expectation, around 15% in terms of revenue performance and margin profile, as you know, for that business has been strong. With that said, part of the reason why there's a decline quarter one to quarter two is we're guiding somewhat lower expectations for Hyve in quarter two. Still growth, still good margins, but saw some good performance in quarter one. It breaks down into three categories, and there's more that, Hyve provides. You think about the design, part of the Hyve business that continued to perform at or better than expectations. You look at the assembly type of work that's performed well as, we saw the quarter play out. Finally, the distribution-like services, whether that's strategic buys, if it's loose parts and spares, those programs continue to perform well. They're very resilient. In our hyperscale community, data center and power continued to be of shortage or constrained. There still is some demand out there for us to fulfill. Just getting to the interest expense, yes, it's been elevated. You can see that it almost doubled in Q1 year-on-year. It's quite meaningful. It gets a little bit better in quarter two, still up $30 million-ish. At $76. Matt, I think I would assume the cash flow generation expectation and the paying down of the revolver that we tapped throughout the quarter probably brings down that interest expense somewhat in the second half of the year, but I wouldn't take much off of that. Okay, fair enough. Thanks so much. Yeah. I just wanna add, you know, we had a particular around Hyve there, but high-growth technologies grew mid double digit and, you know, continue to be greater than 20% of our overall portfolio. As that becomes more meaningful, you know, this is why we're beginning to refer to gross billings overall because, you know, obviously we. You know, when we think about gross billings, we think about the productivity of the entire organization. Okay. Thank you. We will take our next question from Shannon Cross with Credit Suisse. Your line is open. Thank you very much. I had a couple as well. First, can you talk a bit about end verticals and what you're seeing? I'm just wondering, obviously, you know, where I'm at, there's challenges in the financial sector, there's challenges in the tech sector with the layoffs. I'm just wondering, within your conversations with your customers, what they're hearing from some of their customers in terms of demand, and if you're seeing any or hearing of any pockets of growth as well. Then I have a follow-up. Thank you. Yeah. Shannon, we don't have a maniacal focus on end verticals, in particular within our, within our planning system. You know, anecdotally, what I would say is that, there's a fairly, you know, common theme around constraint and making sure that, you know, people are very careful with their purchase. Perhaps the outlier, around that, and it's not really an end vertical, would be the hyperscale infrastructure and then, you know, all of the, high-growth technologies, for each of the customer sets are in more demand than what I would call the, you know, the foundation or the foundational technologies of the rest of the set. You know, dynamics around, you know, digital transformation type offerings, would be, you know, it's more of a horizontal statement, seems to be uniform around all of the, you know, the end markets. Okay, thank you. I'm just curious in terms of inventory, can you be a little more specific in terms of what drove the decline in inventory and where you think maybe normalized inventory levels for you are? I know you're getting close, I think. Was it more PCs, or was it because you had strength in Hyve? Just kind of wondering about the composition of what you have there. I guess also, do you see any opportunities for maybe some inventory, strategic inventory purchases given where component costs are maybe on the Hyve side? Thank you. Yeah. I'll start with the last question first on inventory scrap purchases. Well, on all sides of the business. Clearly that's an aspect, an element, primarily North America around strategic buys. They're a little bit larger. Those haven't stopped. We continue to have the same kind of discipline around the requirements of what that is needed for us to purchase and how fast that sells through. Shannon, to your question about scrap purchases within Hyve, that continues to play out. They're still flowing and producing quite well. I think that will continue for the rest of this year. If I think about overall inventory demand, it was somewhat elevated as we came into quarter one. I think that'll start to work itself down. The answer to were there any pockets that saw elevation or improvements, I think it was a fairly consistent improvement across the board, and that's an Americas, Europe, and Asia comment. What we had said last quarter, and it's still true in our expectations, in regards to Hyve, is that we do expect that the Hyve inventory will continue to unwind as we made some larger investment decisions in it last year that are starting to be collected or excuse me, build and collected in Q2 and Q3, Q4. Thank you. Okay. Thanks, Shannon. There are no further questions at this time. I will turn the call back to Mr. Rich Hume for closing remarks. Well, thank you very much. I'd like to thank our 23,500 coworkers around the globe for their focus and dedication in helping our customers and vendors and partners proceed each and every day. I'd like to thank you. We appreciate your interest in TD SYNNEX, and thanks for joining us today. That concludes today's conference call. You may now disconnect. Have a nice day.