Okay, great. Good afternoon, everyone. I'm Pat Ennis. I'm on the payments processors and fintech team. Happy to have Verra Mobility joining at the UBS Tech and AI Conference today. On stage with me, we have David Roberts, President and CEO, and Craig Conti, CFO. So thanks for being here, guys. Thank you. So to start, for those who may not be familiar with the Verra Mobility story, I think it would be helpful for David to provide or give an overview of the different segments of the business, the high-level secular trends in the verticals the company operates in, and the competitive landscape. Sure. Great to be here. Craig and I both live about 15 minutes from here, so it's nice to have a drive to work or to one of these conferences and to travel. So Verra Mobility is a global leader in smart transportation, and that effectively shows up in three different customer segments. The first one is government solutions, where we are the number one provider of automated enforcement technology in North America. That includes things like red light cameras, speed cameras, school bus stop arm cameras, bus lane cameras, and even a couple more use cases other than that. Principally, that business operates here in the United States, where we have an approximately 70% market share. And then we also operate in Australia, New Zealand, and in Europe. Our primary customer is local cities and municipalities who want to change the trajectory of safety on their roads, and they use automated technology as one of the tools in their toolkit to do so, and that represents roughly 45%-ish of our total business. Our next business is commercial services, where we're the number one provider of toll management solutions for commercial fleets in the United States. That mostly shows up as rental cars. So if you are ever on a business trip and you rent a car from Hertz or Avis or Enterprise, and you see that box up on the screen, on the windscreen, that's us. So everything related to that program is effectively outsourced to Verra Mobility, where we are connected to all of the toll authorities. We pay on their behalf. We collect payment on behalf of the rental car payment. Everything effectively for that, the call center, everything is outsourced to us. We also work with fleet management companies who offer those services to their corporate clients. That business is mostly North American, but we also operate a little bit in Europe. We can talk about that in terms of growth a bit later. And then our third segment is our parking segment, which is an asset we bought about five years ago now called T2, where they work with universities and municipalities on their parking. So that shows up as permits and enforcement, sort of an ERP software platform, as well as hardware, meaning pay stations, as well as what we call parks, which is parking access. So those are the gates and the payments. They move gates up on parking lots. So that's kind of the shape of the business. Okay, great. Appreciate all that detail. And so I think next maybe we'll jump into the government solutions segment. So at Q3 results, you provided a multi-year government solutions total revenue outlook calling for a 10%-12% CAGR over 2024-2027, then high single-digit percentage service revenue growth in 2028 and beyond. You've also provided your projection for NYC revenue from this outlook. Can you talk about what assumptions underpin your revenue outlook for NYC and the rest of the government solutions business portfolio? Yeah, sure. I mean, we're really excited about the progression that we have here. So we did announce New York City, their intention to renew. We're still going through the final contract here. It's $963 million. That's a five-year deal with a five-year option to renew. We've had New York City as a customer for a long time. We're very proud to have that. And when you think about the shape of that contract, there's a 1,000-camera expansion in there. There's also some things that we're doing that we didn't do before. So some nice revenue growth in the contract. When you look at the government solutions business outside of, and I don't want to hit on any of your other questions, I'm sure you've got a few more, but outside of New York City, continuing to see really strong growth there. We're going to have a year this year where we'll have high single-digit growth in service. I expect that for the next 2-3 years, high single-digit, low double-digit growth as we've continued to expand TAM, and we've continued to penetrate existing states with new modalities. We're very excited about our growth. And I think that growth trend is durable for the medium term. Definitely. And so I mean, I guess taking a step back then and looking at the opportunity set, and you touched on this a little bit, but can you give us an update of where you are versus the 21 regional states that had automated enforcement at the time you went public? Yeah. So if you go back to when I joined the company over 11 years ago, it was, I think it was a little less than 21, but automated enforcement was still sort of catching on from a state legislature support perspective. We now have authorized legislation in 36 states. So that includes not only just red light camera, but speed, school bus, and some of the others as well. Okay, great. Perfect. And so I guess segueing to the commercial services segment, similarly, your preliminary outlook is expecting the commercial services revenue growth to be roughly mid-single digits versus the high end of mid-single digits in 2025. Can you recap the assumptions for that growth outlook and what cadence we should think about next year, especially exiting 2026? Yeah. So I think probably a good place to start with that is how did the commercial service business grow, right? So David kind of walked through what our major customers are and a lot of that market that we participate in. And the way I like to think of it simply is 1/3, 1/3, 1/3. That's the growth algorithm. So, 1/3 is call it GDP-ish travel growth, especially in the United States. Another third are what I would call classic growth initiatives. So those are things that we can allocate capital to and grow things like our fleet business, our footprint in Europe. That's the second third, if you will. And the remaining third are the secular tailwinds, which is the addition of toll roads in the United States of America. So, 20 new toll roads over the last year have been added in the United States of America. That's about the run rate per year. So add a toll road, the tailwind to the company. And then the continued transition to cashless toll roads in the United States. We're about 70%-75% penetrated with, obviously, the balance to go. And as roads go from barrier-based to cashless toll roads, the adoption of our product goes up as a convenience to the customer. So if you take those and you take any growth rate we talk about for commercial services, it's coming from those three components. Okay? So now let me. That's the backdrop. Let me answer your question specifically. I expect mid-single digit growth next year because I think travel is probably going to be a little lower than what would be, call it the normal run rate of GDP in the U.S. So if the normal GDP growth is 2%, I expect travel to be about 1%. And here's how I got that number. That's pretty much where we are year to date in 2025. So there's been a lot of talk in the industry. And I always say, especially at these conferences, is if you're looking for a leading indicator for the commercial services business, you'd always look to travel. And the folks who have the best view of that are certainly the airlines. So a lot of what I'm going to tell you is what I hear from the airlines. They have forward-looking data that's pretty good. But as I look at where we were in the last three months with the government shutdown and how that was going to impact the airlines, it's kind of worked itself out at this point. And we're about 0.5%-1% growth overall year to date, almost all the way through 2025. I simply took that growth rate, put it in 2026, and then built from there. That's how we get to mid-single digit growth. Okay. I appreciate it. Those building blocks were great. I mean, where do you see the kind of long-term growth of this business today? I mean, I know you just walked through kind of those third to third to third, but does that growth algorithm by component outside of maybe GDP or the secular tailwinds, do you see that changing materially at all, or mid-single digits is kind of the way to look at it? I think it's between mid and high. I really think it's between mid and high. And the swing factor there would probably be to the degree that travel increases faster in the United States. Particularly in the United States, you would see our growth rate go higher. But everything I know now tells me it feels more like mid. Okay. Perfect. And then I know we just touched on this briefly, but maybe you could offer a little bit more specifics on just like how the government shutdown and the FAA impacted your business specifically within the commercial services segment? Yeah. It wasn't a lot. So what I'm going to say, since it didn't happen for a very long time, is a little more qualitative. But what we saw was the rental volume stayed pretty constant. And I think that the assumption is when you have a short-term disruption in airline travel, folks will still take the trip, but maybe they'll drive. Right now, I don't think that would be the same thing if the government shutdown went on for six months. But in the little nanosecond that we had, we did not see a super material pullback on the rental car side of the house in terms of volume. Okay. Great. And then last year at the conference, you had mentioned the Avis Budget contract renewal comes up in Q4 2025. Can you share any updates on that renewal? Are there important RFPs or renewals coming up over the next year or so as well? We don't talk much about it, but we're in active discussions with Avis Budget currently. The next one to come up is Enterprise, which is toward the end of next year. Okay. Perfect. And then moving on, kind of we've talked about the segment-level preliminary outlooks, but for 2026, putting it all together, you've provided kind of the outlook for mid-single digit revenue growth in commercial services, high single digits in government solutions, and low single digits, the mid-single digits in the parking segment. What are some of the biggest variables in this outlook? I feel pretty good about that outlook. I think we have a good view of government solutions, a little bit longer cycle of the business, where just for anybody who may be newer to the story, when we win a new deal and we put that forth as this is now in our backlog as annual recurring revenue, between the time that we make that determination, we get what's called a notice to proceed on the deal versus when it actually shows up in revenue is anywhere from 12-18 months. Right? So that gives us a little bit more surety, at least on the top line. When I look at the parking solutions business or T2, I feel pretty good about that. The business has grown this year. They've hit their plan. I think they're executing really well. There's always variability on the commercial side of the house. I mean, and that has a lot to do with we're a net taker of some of that revenue. People need to come through TSA and come up to the rental counter for our business to begin. So to the degree that you see ebbs and flows there in the American consumer, that'll impact our business. But today, how we set it on the third quarter call is kind of how we see it. Okay. Perfect. And then the adjusted EBITDA margin, that's expected to climb by roughly 250-300 basis points next year. Can you recap the drivers for us and help us understand kind of what are one-time items versus persisting? Yeah, sure. I think they're declining. Oh, sorry. Sorry. Did I say? You said it's okay. So yeah, declining. Just if anybody's taken. We like what yours is better. Sorry. If anybody's taken copious notes, it's declining, so for 250 basis points, that's right. So a couple of things. Number one, I think on the positive side, we did an ERP transition that's mostly behind this, so we won't be spending that next year. Then also we have kind of a dichotomy in our company where we have one business with a higher margin profile than the other, that's favoring CS. GS is going to grow a little faster, so I've got a portfolio impact that is kind of negative, so it offsets that goodness we get from cost. But I think the biggest piece really is the renewal of New York City. And if you think about the renewal of New York City, I think about it in kind of four components, and you have to know all four, I think, for it to make sense. So we hadn't bid this contract publicly for, well, not publicly at all, for almost 10 years. So there was price discovery, and there's different prices in the market now than there were at that time. So there was a price rationalization that was negative to call it the EBITDA margin percentage. What we also, there's an expansion. There's 1,000 camera expansion. That's positive EBITDA dollars over the life of the deal. And there's also new things, new scope in the contract, things that we didn't charge for previously that now are done not at cost, but at margin. So that was positive. And if you added all those up on the EBITDA dollars, it's slightly positive, right? Feel good about that. The other piece of this, and we've been very consistent, and the customer has been very consistent that there's a requirement for minority and women-owned businesses, and that is going to be about a $20 million-$25 million investment per year by the company. So in other words, that's work we used to do in-house that now we do through a third party just to adhere to the contract. That's going to cause a margin step back in government solutions, which is what's hitting the overall company. Now, that's a one-time thing. I mean, it finds a new level, and then, of course, we expect to grow from there. And to that point, growing from there, margins in 2027, is there any expectation off of that 26 base? Yeah, and I'll do this. I'm not going to do it for the total company level, but I'll do it for government solutions because we did kick that out publicly. I think we'll grow government solutions margins anywhere from a point to a point and a half per year, compounded out through 2028. I think that business, that government business is a high 20%-30% margin business by the time we're done in the next couple of years. Okay. Great. Perfect. And segueing here to maybe before we go into some capital allocation thoughts, just new wins and opportunities. In terms of new wins, the company called out an automated photo enforcement pilot win in San Jose in Q3. Any updates on how this pilot is going? What metrics municipalities are monitoring during the pilot? Yeah. So that's part of sort of a broader California strategy where we've been working with local legislators to do a couple of things. One is to introduce school zone speed, which they did not have previously in the state of California. They now are doing a pilot in six cities. The three that have RFP, we have won all three at this point, which includes San Jose. That's early days, so no real numbers. But what they're going to look at is the efficacy of the program. Is there a reduction in speeding in school zones and a reduction of citations and/or critical accidents? The other part of the California strategy is also fixing the former red light legislation, which was a little bit onerous for both the DMV and the government as well as for the citizens. And that's been fixed. We expect that'll have some growth. Ultimately, big picture, we'd love to see California embrace school zone speed and school bus enforcement across the entire state, which is our objective. Okay. Awesome. Appreciate you hitting on that. And then I guess longer term, just one, we were talking before coming on here about Waymo and some automated vehicles. I mean, how do you see that impacting the business longer term if you see greater adoption of those types of vehicles? Yeah. Currently, it's such a small thing. The statistic I like to share is that there's 230 or 240 million personally owned passenger vehicles in the United States, none of which are autonomous. If you were to look at the fleet size of Waymo here in Phoenix, I think it's around 500 vehicles. So we're sort of, it's a bit of a pebble in the ocean at this point. Longer term, and when I say longer term, that's 20 years from now. I think there'll be a sea change of what that means. It's probably less of the fact that there's a Waymo or the Tesla version of that, which I can't, Cybercab or whatever the name is. Robotaxi. What's it called? Robotaxi. Robotaxi. It's going to be more of the vehicle's ability to self-drive itself, that people would own a vehicle that can also self-drive. But that doesn't necessarily mean it's going to abide by the speed limit or avoid a school zone or things like that. So I think for the midterm, so the next 10 years, it's not something that we see as a major impact to our business. It's certainly something we're keeping an eye on. We're actually looking for ways to partner with Waymo and others on some of those things. Okay. Perfect. And I imagine for tolls, that would still be involved if cars are autonomous cars. I don't think toll roads are definitely not going anywhere, and if you want to, I don't know if this is in your script, but we just announced a partnership with Stellantis where we've embedded our tolling technology inside Stellantis vehicles so that people can actually pay for a toll from their vehicle versus having a transponder. Okay. Makes sense. Perfect. And then, so I mean, I guess diving into the capital allocation, you've increased the buyback authorization by roughly $150 million to a total of $250 million available through November 2026. I believe you've made no repurchases year to date through Q3. Is the increase in that authorization a more definitive signal you're likely to meaningfully ramp up share repurchases in the coming quarters? No. I think it was just that what we've always said is that our first priority is to invest in the business, which we've done. If you look at the investments we've made, in particular in our government business, which are starting to bear fruit, we have always maintained an active M&A posture to look for areas that we can expand our growth horizon through highly adjacent and complementary assets. We just haven't found ones that meet our criteria, whether strategic or financial. So with that, we've shown a pretty strong history of returning capital via share repurchases over the time we've been public. So we're effectively arguably underlevered at this point where we're sitting right at about two times, I think. So, it was an indication of one, that the strong cash flow generation capability of the company, our belief that where our shares are currently trading, this is a really good purchase for us because we think they're undervalued, and I think it certainly is. I don't know that it's a signal to the future, but it's very consistent with the past of how we've treated our capital allocation. Okay. Perfect. And I guess just expanding on that a little bit, you mentioned kind of that net leverage being maybe below where you've been in the past. Could you walk through how you're thinking about prioritization over the next 12-18 months between organic investment, M&A? We hit on buybacks a little bit and just debt repayment, especially in this kind of more benign interest rate environment. I would say first and foremost, invest in the business you have. We have a great portfolio of businesses. We want to see them continue to grow and have run rates. So we'll continue to do that, especially on the technology side. Part two would be, as I mentioned before, M&A. I think the markets have given us a lot of feedback on how we think about leverage. So I think our M&A is going to be pretty tight to adjacencies that fit. We don't want to go too high on our leverage. So we want to stay in that probably max 3, 3.5 times on any sort of deal. But the business does delever very quickly. But in lieu of that, I think share repurchases, we generate a lot of cash. We could consider restructuring our debt, but we just did that earlier this year in terms of the term loan and everything else. So I think we're in a really good position on our balance sheet. Yeah. To add to that? Yeah. The only thing I would add to that, Pat, is when we were on stage last year, we said the same thing, and I want to make sure we're consistent because this is really how David and I run the railroad is we capitalize our cash flows. We capitalize our cash flows. We know exactly. I have a covenant-like Term Loan B. I can prepay at my option. I know what my tax rate is. I know what the return on that dollar out the door is. This is after we fund everything internally, by the way, with the excess cash flow. The second thing we can do is buyback shares. We have a very live view of the intrinsic value of the company. We know where the stock's at. I have an open authorization. That's another capitalized cash flow. Then the third thing is on M&A with the leverage kind of governors that David just talked about is we look at the free cash flow of the deal back at the WACC, and I compare and pick the highest one. That's what we've done. And I would say that anybody researching the company, every quarter, we put out an investor presentation after earnings that has a wheel in it that says, "Here's how we've allocated capital for the last five years or last six years." And that wheel, each piece of that pie is relatively large because we've done all three at different times in the market. So we've paid down over $200 million worth of debt since we went public. We've bought back over $500 million worth of shares, and we've done some pretty marquee deals. So we keep that live. And given the free cash flow generation of the company, which has remained healthy even through our government solutions growth cycle here that we're in, we get the opportunity to make that decision every 60 days. We take it really seriously. On that, I mean, you touched a little bit on this, but just in terms of M&A, I don't think you've made an acquisition since T2 in December 2021. That's right. Is there any update on how the company sees the M&A pipeline at the moment? What parts of the business are you looking to enhance maybe with M&A versus organic? I think we're sort of. I don't know that we prioritize. Some of this is about what's available too in the market. I mean, we have a pretty strict screening criteria. Our not closing a deal doesn't mean that we haven't been remarkably active in M&A. If you looked at the last 10 deals that we went pretty far in a process, nine of them did not transact. And the reason was for the same reason we walked away, which was price. So the market still has, I think, an elevated view of itself related to valuation. And so we're not in a hurry. We can be very, very patient, and we can continue to buy shares, pay down debt, or invest in our own businesses. But there are also things. There are areas of technology and camera technology that we've been really interested in terms of the innovation around AI and the capabilities of multi-use cameras at the roadside. So those are kind of; that's an example of some of the areas that we're looking at. Okay. Great. And we still have some time left, but just given the audience participation here, just thought I'd open it up just in case. I still have a few questions to go through, but. From both of you. Either way, so I had a few more questions just as it related to the NYC Department of Transportation contract costs. I know you mentioned some of kind of these one-time readiness investments and then also maybe some of the minority-owned subcontractor costs, but within the minority-owned subcontractor costs, the one-time readiness investments for this contract, one of the cost headwinds was the requirement that at least 30%, I believe, of the total contract is invested in minority and women-owned subcontractors. The company noted that outside of New York City, only a few major metropolitan areas have the same level of requirements around the use of, example, minority women-owned businesses, but as the company notes, as you noted, they tend to do better in larger municipalities, so as far as you're aware, what other large metropolitan areas that the company aims to work with might have similar requirements here? Something down the line that. New York is very unique. It was a very high percentage, and it's a fix based upon the amount of revenue. I don't know anyone that does. That's the only one that I know of that has done that so far. But if you look at San Francisco, there's a requirement significantly less as a percentage. But you'll probably see California, you probably have a bit of that. But I would not say it is industry standard, but it was certainly very important to the city of New York. Okay. Understood. And I guess we talked about margins a little bit and some of these one-time readiness, but do you expect a similar level of investment for all large-scale projects similar to kind of the NYC contract? No. Or is the company able to? We've already made, I mean, we talked about a platform called Mosaic. That's effectively the investment for all other customers. New York is, it's very unique. There's no other customer like it. So you really treat it as its own business to some extent because it's so large. They have over 3,000 installed cameras. I think our next largest customer is several hundred. So it's a pretty big magnitude and just the size and scale of the program and the location of it. So you just have to think of it a little bit differently. Okay. And then last question here. Yep? Just expanding TAM. We know those legislative decisions are very impactful to the TAM expansion of the business. We talked about California a little bit and those positive legislative changes. Is there any new legislative changes throughout Q4 to call out anything you expect on the horizon to come to kind of. Yeah. Most legislatures are relatively quiet this time of year. They tend to pick up in January and the spring for the most part. I don't see any material change one way or the other. We released a statement related to Ontario, and we canceled a program there based upon legislative. They no longer wanted the program, so they shut it down. And we issued a release around that, which was disappointing. There was quite a few citizens that didn't really like the cameras since they were actually literally chopping them down. And given that it was our CapEx and the premier was no longer interested, we decided to pull out. But other than that, that's the only sort of negative one that we could talk to right now. Okay. Definitely. And understood. So I mean, we're about at time here. So really appreciate you both being on stage and being a big part of our conference. Yeah. Thanks. Yeah. Thank you for having us. Appreciate it. Appreciate it. Thank you. Yeah. Cool. Yeah. Cool.