Core Insights - JR Research is recognized as a top analyst in technology, software, and internet sectors, focusing on growth and GARP strategies [1] - The investment approach emphasizes identifying attractive risk/reward opportunities with robust price action to generate alpha above the S&P 500 [1][2] - The investment group Ultimate Growth Investing specializes in high-potential opportunities across various sectors with a focus on strong growth potential and contrarian plays [3] Investment Strategy - The strategy combines price action analysis with fundamental investing to identify growth opportunities with significant upside potential [2] - The focus is on avoiding overhyped and overvalued stocks while targeting battered stocks that have recovery potential [2] - The investment outlook typically spans 18 to 24 months for the thesis to materialize [3] Target Audience - The group is designed for investors looking to capitalize on growth stocks with strong fundamentals, buying momentum, and turnaround plays at attractive valuations [3]

Group 1 - The article highlights a buy rating for Vertiv Holdings Co (NYSE: VRT) based on robust earnings and favorable AI infrastructure trends [1] - Despite a fair valuation, the company is positioned well due to ongoing demand in the tech sector, particularly related to AI [1] - The analyst emphasizes the importance of core values such as excellence, integrity, transparency, and respect for long-term success in investment [1] Group 2 - The article does not provide any specific financial metrics or performance data for Vertiv Holdings Co [2] - There are no recommendations or advice regarding the suitability of investments for particular investors mentioned in the article [2] - The article clarifies that past performance is not indicative of future results, emphasizing the need for careful consideration in investment decisions [2]

Core Insights - Vertiv Holdings (VRT) reported strong second-quarter 2025 non-GAAP earnings of 95 cents per share, exceeding the Zacks Consensus Estimate by 14.46% and reflecting a year-over-year increase of 41.8% [1] - Net sales for the quarter reached $2.64 billion, a 35.1% increase year-over-year, also surpassing the Zacks Consensus Estimate by 11.86% [1] - The company experienced robust organic sales growth of 34% year-over-year [1] Financial Performance - Organic orders rose 11% year-over-year, with a book-to-bill ratio of approximately 1.2x, and a backlog of $8.5 billion, which is 21% higher than at the end of 2024 and up 7% from the end of Q1 2025 [3] - Product revenues, which accounted for 82.1% of total revenues, increased 39.3% year-over-year to $2.16 billion, while service revenues rose 18.7% to $472.1 million [4] - Revenue breakdown by region: - Americas: Revenues increased 42.9% year-over-year to $1.60 billion [4] - Asia and Pacific (APAC): Revenues increased 36.9% year-over-year to $560.2 million [5] - Europe, Middle East, and Africa (EMEA): Revenues increased 12.5% year-over-year to $475.6 million [6] Operating Details - Selling, general and administrative (SG&A) expenses rose 8.7% year-over-year to $395.6 million, but as a percentage of sales, they decreased by 360 basis points to 15% [7] - Adjusted operating profit increased 28.2% year-over-year to $489.3 million, with a non-GAAP operating margin of 18.5%, down 100 basis points year-over-year [7] Regional Performance - Adjusted operating profit by region: - Americas: Increased 34.9% year-over-year to $384.6 million [8] - EMEA: Decreased 4.8% year-over-year to $104.2 million [8] - APAC: Increased 83.3% year-over-year to $59.2 million [8] Balance Sheet and Cash Flow - As of June 30, 2025, cash, cash equivalents, and marketable securities totaled $1.64 billion, up from $1.47 billion at the end of Q1 2025 [9] - Long-term debt decreased slightly to $2.90 billion from $2.904 billion [9] - Cash flow from operating activities was $322.9 million, an increase from $303.3 million in the prior quarter, with free cash flow at $277 million [10] Future Guidance - For 2025, revenues are expected to be between $9.925 billion and $10.075 billion, with organic net sales growth projected at 23% to 25% [11] - Adjusted operating profit is anticipated to be between $1.950 billion and $2.030 billion, with an operating margin in the range of 19.7% to 20.3% [11] - For Q3 2025, revenues are expected to be between $2.510 billion and $2.590 billion, with organic net sales growth projected at 20% to 24% [12]

Core Insights - Vertiv Holdings Co reported better-than-expected second-quarter results, with earnings of 95 cents per share, surpassing the analyst consensus estimate of 83 cents per share, and quarterly sales of $2.64 billion, exceeding the estimate of $2.35 billion [1][2]. Financial Performance - The company raised its FY2025 adjusted EPS guidance from a range of $3.45-$3.65 to $3.75-$3.85 and increased its sales guidance from $9.325 billion-$9.575 billion to $9.925 billion-$10.075 billion [2]. - Vertiv experienced a 35% sales growth, indicating strong market demand and robust order momentum [3]. Strategic Positioning - The CEO highlighted the company's strategic investments in capacity expansion and innovation to meet the growing infrastructure needs, particularly in AI-enabled data centers [3]. - Following the earnings announcement, analysts adjusted their price targets for Vertiv, with Oppenheimer raising it from $140 to $151 and RBC Capital from $143 to $162, both maintaining an Outperform rating [4][9].

Core Insights - The article discusses the author's investment portfolio and insights into various stocks, emphasizing a unique perspective based on their background [1]. Group 1 - The author holds long positions in shares of major companies including Google (GOOG), Taiwan Semiconductor Manufacturing Company (TSM), Amazon (AMZN), and NVIDIA (NVDA) through stock ownership, options, or other derivatives [2]. - The analysis aims to provide contrasting views to other investors, highlighting the author's extensive experience in the field [1]. - The article is intended for informational purposes and encourages readers to conduct their own research before making investment decisions [3].

Core Insights - Vertiv Holdings Co. (VRT) reported second-quarter 2025 adjusted earnings of $0.95 per share, exceeding the Zacks Consensus Estimate of $0.83, and up from $0.67 per share a year ago [1][8] - The company achieved quarterly revenues of $2.64 billion, surpassing the Zacks Consensus Estimate by 11.86%, compared to $1.95 billion in the same quarter last year [1][8] Company Overview - Vertiv is a leading global provider of critical digital infrastructure and services for data centers, communication networks, and commercial and industrial environments, focusing on power, cooling, and IT infrastructure solutions, particularly AI-enabled infrastructure [2] Performance and Growth - The company experienced a 35% sales growth, driven by strong market demand and expanded capabilities to meet complex infrastructure needs [3] - VRT's stock price has increased by 29.4% year to date and 58.8% over the past three months, reflecting the resurgence of AI-infrastructure providers amid significant spending by data center hyperscalers [5] Strategic Partnerships - Vertiv's partnership with NVIDIA Corp. is a key catalyst for growth, aiming to stay one GPU generation ahead to provide efficient power solutions for next-gen AI data centers [3][4] - The company has a diverse partner base, including Ballard Power Systems, Compass Datacenters, Intel Corp., ZincFive, and Tecogen, enhancing its market position [4] Future Guidance - For the third quarter, VRT forecasts adjusted earnings of $0.97 per share and total revenues of $2.55 billion, slightly above current consensus estimates [6][9] - For 2025, VRT projects adjusted earnings per share between $3.75 and $3.85, with total revenues expected to range from $9.93 billion to $10.08 billion, both exceeding current consensus estimates [10] Long-Term Prospects - The AI infrastructure market is projected to see a significant increase in capital expenditure, with four major companies planning to invest $325 billion in 2025, marking a 46% year-over-year increase [12] - VRT's long-term EPS growth rate is estimated at 28.3%, significantly higher than the S&P 500's long-term growth rate of 12.6%, indicating strong future potential [13]

Core Insights - Vertiv reported record GAAP revenue of $2,638 million for Q2 2025, exceeding analyst expectations of $2,353.9 million, driven by strong demand for data center solutions, particularly in the Americas and Asia Pacific regions [1][2] - Adjusted diluted earnings per share reached $0.95, surpassing the consensus estimate of $0.83, reflecting a year-over-year increase of 41.8% [2] - Despite strong sales growth, higher supply chain and tariff-related costs pressured adjusted operating margins, which fell to 18.5% from 19.6% year-over-year [2][10] Financial Performance - Revenue (GAAP) for Q2 2025 was $2,638 million, a 35.1% increase from $1,952.8 million in Q2 2024 [2] - Adjusted operating profit was $489.3 million, up 28.1% from $381.8 million in the previous year [2] - Adjusted free cash flow decreased by 17.7% to $277 million compared to the prior year [2][11] Regional Performance - The Americas segment saw net sales increase by 42.9%, driven by robust North American data center investment, with adjusted operating profit rising by 34.9% [6] - Asia Pacific net sales grew by 35.1% year-over-year, with adjusted operating profit jumping 83.3% [7] - EMEA region reported a 12.5% increase in net sales, with management noting robust growth in the pipeline [7] Strategic Focus - Vertiv is focusing on product innovation, particularly in AI and cloud deployments, while investing in its global supply chain and manufacturing [4][9] - The company aims to strengthen relationships with large data center operators and technology leaders to position itself as a reliable infrastructure partner [4] - A recent acquisition of Great Lakes Data Racks & Cabinets is expected to enhance its portfolio in high-density racks and enclosures [9] Future Outlook - For FY2025, Vertiv raised its financial outlook, expecting net sales between $9.93 billion and $10.08 billion, with organic growth of 23% to 25% [12] - Adjusted operating profit is projected to be between $1.95 billion and $2.03 billion, with adjusted earnings per share forecasted at $3.75 to $3.85 [12] - Q3 2025 projections include net sales of $2,510 million to $2,590 million and adjusted EPS between $0.94 and $1.00, with caution regarding potential impacts from proposed tariffs [13]

Part I - Financial Information [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents Vertiv's unaudited condensed consolidated financial statements for the periods ended June 30, 2025, including detailed statements of earnings, comprehensive income, balance sheets, cash flows, and accompanying notes [Condensed Consolidated Statements of Earnings (Loss)](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Earnings%20%28Loss%29) The company reported significant growth in net sales and net income for both Q2 and H1 2025, with Q2 2025 net sales rising to **$2,638.1 million** and net income to **$324.2 million** Q2 and H1 2025 vs 2024 Earnings Performance | Metric | Q2 2025 | Q2 2024 | YoY Change | H1 2025 | H1 2024 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Net Sales** | $2,638.1M | $1,952.8M | +35.1% | $4,674.1M | $3,591.9M | +30.1% | | **Operating Profit** | $442.4M | $336.0M | +31.7% | $733.1M | $538.6M | +36.1% | | **Net Income** | $324.2M | $178.1M | +82.0% | $488.7M | $172.2M | +183.8% | | **Diluted EPS** | $0.83 | $0.46 | +80.4% | $1.25 | $0.44 | +184.1% | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) Comprehensive income for Q2 2025 significantly increased to **$444.6 million**, driven by higher net income and a substantial positive foreign currency translation adjustment Comprehensive Income Comparison (in millions) | Item | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net Income** | $324.2 | $178.1 | $488.7 | $172.2 | | **Other Comprehensive Income (Loss)** | $120.4 | $(26.3) | $194.0 | $(60.6) | | **Comprehensive Income** | $444.6 | $151.8 | $682.7 | $111.6 | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to **$10,406.2 million** from **$9,132.5 million** at year-end 2024, with total equity also rising significantly to **$3,125.4 million** Balance Sheet Summary (in millions) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $6,302.0 | $5,101.8 | | **Total Assets** | $10,406.2 | $9,132.5 | | **Total Current Liabilities** | $3,614.5 | $3,097.0 | | **Total Liabilities** | $7,280.8 | $6,698.2 | | **Total Equity** | $3,125.4 | $2,434.3 | - Cash and cash equivalents increased to **$1,640.8 million** from **$1,227.6 million** at the end of 2024[15](index=15&type=chunk) - Retained earnings became positive at **$222.0 million**, a significant improvement from a deficit of **$(238.3) million** at year-end 2024[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities for H1 2025 was strong at **$626.2 million**, while financing activities used a modest **$32.9 million** due to the absence of large stock repurchases Cash Flow Summary - Six Months Ended June 30 (in millions) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | **Operating Activities** | $626.2 | $519.0 | | **Investing Activities** | $(182.8) | $(81.5) | | **Financing Activities** | $(32.9) | $(626.7) | | **Increase (Decrease) in Cash** | $423.8 | $(200.9) | - The significant decrease in cash used for financing activities in H1 2025 is primarily because there were no common stock repurchases, compared to **$599.9 million** in repurchases in H1 2024[17](index=17&type=chunk) [Notes to Condensed Consolidated Financial Statements (Unaudited)](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) This section provides detailed explanations of the company's accounting policies and financial results, covering revenue disaggregation, debt structure, segment performance, legal contingencies, and a subsequent acquisition event - Vertiv provides mission-critical digital infrastructure technologies and services for data centers, communication networks, and commercial/industrial environments across three segments: Americas; Asia Pacific; and Europe, Middle East & Africa[25](index=25&type=chunk) - The company adopted ASU 2023-07 for segment reporting, which required expanded disclosure of segment information on an interim basis[29](index=29&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 and H1 2025 financial results, highlighting a **35.1%** increase in Q2 net sales driven by strong volume growth, capacity expansion, and a strong liquidity position to fund operations and a planned acquisition - Key business trends include ongoing capacity expansion, investments in AI-related products and solutions, and expansion of the thermal management portfolio to meet growing demand[101](index=101&type=chunk) - The company is actively managing risks from trade uncertainty and tariffs by pursuing a supply chain strategy of supplier and geographic resilience, including adding regional sourcing and manufacturing capabilities[98](index=98&type=chunk)[99](index=99&type=chunk) Q2 2025 vs Q2 2024 Performance Summary | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $2,638.1M | $1,952.8M | +35.1% | | **Gross Profit** | $896.6M | $741.2M | +21.0% | | **Operating Profit** | $442.4M | $336.0M | +31.7% | | **Net Income** | $324.2M | $178.1M | +82.0% | [Results of Operations](index=27&type=section&id=Results%20of%20Operations) Vertiv's Q2 2025 net sales increased **35.1%** year-over-year to **$2,638.1 million**, driven by higher sales volumes, while gross margin declined to **34.0%** due to product/service mix and tariffs - Q2 2025 net sales growth of **35.1%** was primarily driven by higher sales volumes, with product sales increasing by **$601.6 million** and Services & Spares sales by **$83.7 million**[103](index=103&type=chunk) - Gross margin for Q2 2025 decreased to **34.0%** from **38.0%** in Q2 2024, primarily due to the mix of product and service sales and the impact of tariffs[105](index=105&type=chunk) - Interest expense for Q2 2025 decreased by **52.5%** to **$21.3 million**, mainly due to reduced interest rates from Term Loan amendments and higher interest income[109](index=109&type=chunk) - For the six months ended June 30, 2025, net income increased by **183.8%** to **$488.7 million** compared to the same period in 2024[119](index=119&type=chunk) [Business Segments](index=28&type=section&id=Business%20Segments) In Q2 2025, all segments reported strong sales growth, with the Americas leading with a **42.9%** increase in net sales to **$1,602.3 million**, despite a slight operating margin decrease Q2 2025 Segment Performance | Segment | Net Sales | YoY Change | Operating Profit | Margin | | :--- | :--- | :--- | :--- | :--- | | **Americas** | $1,602.3M | +42.9% | $384.6M | 24.0% | | **Asia Pacific** | $560.2M | +36.9% | $59.2M | 10.6% | | **EMEA** | $475.6M | +12.5% | $104.2M | 21.9% | [Capital Resources and Liquidity](index=33&type=section&id=Capital%20Resources%20and%20Liquidity) The company's liquidity position remains strong with **$1,640.8 million** in cash and equivalents and **$783.0 million** available under its ABL Revolving Credit Facility, sufficient to fund operations and planned acquisitions - As of June 30, 2025, the company had **$1,640.8 million** in cash and cash equivalents and **$783.0 million** of availability under its ABL Revolving Credit Facility[140](index=140&type=chunk) - Net cash provided by operating activities for the first six months of 2025 was **$626.2 million**, an increase of **20.7%** from the prior year[143](index=143&type=chunk)[144](index=144&type=chunk) - The company expects full-year 2025 capital expenditures (including capitalized software) to be between **$250.0 million** and **$300.0 million**[137](index=137&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=34&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that there have been no material changes in its quantitative and qualitative market risk disclosures from those described in its 2024 Form 10-K - There have been no material changes in market risk disclosures since the 2024 Form 10-K[148](index=148&type=chunk) [Item 4. Controls and Procedures](index=34&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective[150](index=150&type=chunk)[151](index=151&type=chunk) - No material changes to internal control over financial reporting occurred during the quarter ended June 30, 2025[152](index=152&type=chunk) Part II - Other Information [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) Vertiv is involved in a putative securities class action lawsuit and related shareholder derivative lawsuits, and has received subpoenas from the SEC and U.S. Attorney's Office concerning these allegations - A putative securities class action (In re Vertiv Holdings Co Securities Litigation, 22-cv-3572) is pending, alleging false statements between February 2021 and February 2022[155](index=155&type=chunk) - In November 2023, the company received a subpoena from the SEC and a parallel request from the U.S. Attorney's Office for the Southern District of New York related to the allegations in the class action lawsuit[158](index=158&type=chunk) - Consolidated shareholder derivative lawsuits (In re Vertiv Holdings Co Stockholder Derivative Litigation) are stayed pending the outcome of the motion to dismiss in the securities class action[156](index=156&type=chunk) [Item 1A. Risk Factors](index=39&type=section&id=Item%201A.%20Risk%20Factors) The company reports that its risk factors have not materially changed from those disclosed in its Form 10-K for the fiscal year ended December 31, 2024 - There have been no material changes to the company's risk factors since the filing of the 2024 Form 10-K[162](index=162&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=39&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or share repurchases during 2025, with **$2.4 billion** remaining available for repurchase under the current authorization - The company made no share repurchases during 2025[166](index=166&type=chunk) - As of June 30, 2025, **$2.4 billion** was available for repurchase under the company's stock repurchase program, which is authorized through December 31, 2027[165](index=165&type=chunk)[166](index=166&type=chunk) [Item 5. Other Information](index=39&type=section&id=Item%205.%20Other%20Information) The company reports that no director or officer adopted or terminated any Rule 10b5-1 trading arrangement during the second quarter of 2025 - No director or officer adopted or terminated a Rule 10b5-1 trading plan during the second quarter[170](index=170&type=chunk) [Item 6. Exhibits](index=40&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including a Transition and Consulting Agreement, CEO and CFO certifications, and financial data in Inline XBRL format - Exhibits filed include CEO and CFO certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[173](index=173&type=chunk)

Financial Performance - Vertiv Holdings reported stronger-than-expected quarterly results [1] - Vertiv Holdings lifted its full-year outlook [1] Market Dynamics - Shares of Vertiv Holdings advanced Wednesday [1] - Vertiv Holdings is a maker of equipment and cooling systems for data centers [1]

Financial Data and Key Metrics Changes - Adjusted diluted earnings per share (EPS) was $0.95, up approximately 42% year-on-year, primarily driven by higher adjusted operating profit [12][29] - Organic sales grew 34% year-on-year, with strong performance in the Americas (up mid-40s) and APAC (up mid-30s), while EMEA delivered high single-digit growth [13][30] - Adjusted operating profit was $489 million, up 28% year-on-year, with an adjusted operating margin of 18.5%, approximately 110 basis points lower than the prior year due to tariffs [15][30] - Free cash flow for Q2 was $277 million, down year-on-year, but adjusted free cash flow for the first half was $542 million, a robust growth of 24% year-on-year [16][32] - Full-year adjusted free cash flow guidance raised to $1.4 billion, with net sales guidance increased by $550 million to $10 billion [17][37] Business Line Data and Key Metrics Changes - Americas organic sales increased by 43%, driven by strength in colocation and hyperscale markets, with an adjusted operating margin of 24% [32] - APAC saw a 37% organic sales increase, with margin expansion to 10.6% [32] - EMEA's organic sales grew 7%, but the region is expected to be flat for the full year due to operational execution challenges and investments in fixed costs [34][35] Market Data and Key Metrics Changes - The backlog stands strong at $8.5 billion, up 21% year-on-year and 7% sequentially from Q1, supporting increased guidance for the year [18] - The regulatory environment is becoming more conducive to AI infrastructure investment, positively impacting customer discussions and pipeline [19][110] Company Strategy and Development Direction - The company maintains a strategy of driving growth through organic expansion and strategic acquisitions, with a robust M&A pipeline [10] - Recent acquisition of Great Lakes is expected to enhance the company's capabilities in high-end rack solutions and AI infrastructure [26] - Ongoing investments in R&D and capacity expansion are aimed at staying ahead of market demand and delivering innovative solutions [11][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance and future trajectory, highlighting the digital revolution and the fundamental role of data centers [10] - The company anticipates that operational inefficiencies and execution challenges will be resolved by year-end, leading to improved margins in 2026 [31][102] - The management is optimistic about the growth trajectory and market share gains, particularly in the context of AI infrastructure [40][130] Other Important Information - The company plans to change how it communicates orders, providing projected full-year orders rather than quarterly orders to better align with business operations [19] - The tariff situation remains dynamic, with ongoing countermeasures being executed to mitigate impacts [20][21] Q&A Session Summary Question: Margin expectations for 2026 - Management believes that 2026 could be a more normal year for margins, with a positive long-term trajectory expected [48] Question: Strength in backlog and order duration - Backlog duration remains similar to historical trends, with some customers seeking earlier deliveries, indicating a healthy demand [52][53] Question: Impact of tariffs and inflation on pricing - Management indicated that they have the commercial leverage to recover tariffs, despite delays in converting orders to sales [57] Question: Win rates and procurement changes among hyperscalers - Win rates remain stable, with no significant changes in procurement methods among hyperscalers [66][68] Question: Operational inefficiencies - Inefficiencies are attributed to tariff transitions and the need for new sources, compounded by significant growth [75][78] Question: Growth rates for thermal service contracts - Management expects strong growth in thermal service contracts, particularly related to liquid cooling systems [88] Question: Evolution of product offerings for data centers - The company is evolving its product footprint to accommodate higher voltage power distribution and increasing rack density [92][94] Question: Gross margin expectations - Management expects gross margins to improve in Q4 due to operational leverage and resolution of inefficiencies [102][121] Question: Capital allocation priorities post-acquisition - M&A will remain a key part of the capital allocation strategy, with a strong process and active pipeline in place [136]