DMCグローバル（BOOM）2026年第3四半期決算説明会：売上高は14%増加、受注残が拡大

主要ポイント

• 2026年第3四半期の連結売上高は1億7,280万ドルに達し、前年同期比14%増、前四半期比10%増となり、ArcadiaおよびNobelCladの成長に支えられました。
• DMC帰属の報告ベースEBITDAは1,900万ドルで、これには540万ドルのDynaEnergetics関税還付金が含まれています。これらの還付金を除くDMC帰属の調整後EBITDAは1,360万ドルで、前年同期比59%増、前四半期比48%増となりました。
• Arcadiaの売上高は前年同期比25%増、前四半期比14%増となり、商業用アルミニウムフレームおよび高級住宅向けドア・窓の売上好調を反映しました。
• NobelCladの売上高は前年同期比38%増、前四半期比30%増加しました。受注残高は7,240万ドルに増加し、これには四半期として過去最高となる1,600万ドルの米海軍艦艇建造関連の受注が含まれています。
• フリーキャッシュフローは1,660万ドルに改善した一方、純負債は1,370万ドルに減少し、2021年12月のArcadia買収以来の最低水準となりました。
• 経営陣は第4四半期の売上高の見通しを1億5,400万ドル〜1億6,400万ドル、DMC帰属の調整後EBITDAの見通しを1,000万ドル〜1,300万ドルとしています。

主要財務データ

事業および業績の動向

Arcadia

Arcadiaの売上高は前年同期比25%増、前四半期比14%増となりました。DMCに帰属する調整後EBITDAは前年同期比32%増、前四半期比23%増となりました。

非支配持分配分前の調整後EBITDAマージンは14.7%に上昇し、前年同期の13.8%や第2四半期の13.6%から改善しました。販売数量の増加に伴い、商業用、住宅用、および商業内装用製品全体で固定費吸収が進みました。

経営陣は今回の改善の要因として、ショートサイクル事業におけるサービスレベルおよび製品供給体制の向上、ハイエンド住宅向け需要の好調、さらにロサンゼルスでの大型ロングサイクルプロジェクトを挙げています。同社は、2023年に失った地域ショートサイクル市場のシェアの大半を回復したと考えているものの、今後のさらなるシェア獲得においては収穫漸減に直面する可能性があるとしています。

ショートサイクル商業用製品がArcadiaの売上高の約50%、ロングサイクル製品が約25%、住宅用製品が約15%を占めており、残りはWilson内装事業によるものです。

DynaEnergetics

DynaEnergeticsの売上高は前年同期比、前四半期比ともにほぼ横ばいとなりました。調整後EBITDAは1,190万ドルでした。（うち540万ドルの関税還付金を含む）。

同還付金を除く調整後EBITDAは前年同期比34%増、前四半期比57%増となった。一方、調整後EBITDAマージンは9.7%へと上昇した（前年同期は7.1%、第2四半期は6.2%）。コスト削減、製品設計および調達の取り組み、良好な売上ミックス、ならびに防衛分野および強化型地熱アプリケーションからの初期の貢献が収益性を下支えした。

当四半期における防衛分野の貢献額は約75万ドルであった。経営陣は、この機会はまだ極めて初期段階にあり、第4四半期の業績予想（ガイダンス）には含まれていないことを強調した。

NobelClad

NobelCladの売上高は前年同期比38%増、前四半期比30%増となった。調整後EBITDAは前年同期比120%増、前四半期比51%増となり、マージンは15.9%へと上昇した（前年同期は9.9%、第2四半期は13.7%）。

業績は、過去最高の石油化学関連受注に伴う出荷や、大型防衛受注に影響を与えていたサプライチェーン課題の解消が追い風となった。受注残高は7240万ドルに達し、第2四半期末の6350万ドルから増加した。エネルギー、エンジニアードウッド、防衛分野の受注が下支えした。

業績予想（ガイダンス）

DMC Globalは2026年第4四半期の売上高を1億5400万ドル〜1億6400万ドル、DMCに帰属する調整後EBITDAを1000万ドル〜1300万ドルと予想している。

経営陣は、Arcadiaにおける季節的な通常の減速、大型の長期サイクルのプロジェクトの減少、および12月下旬に予定されているカリフォルニア州のアルマイト処理施設の2週間の稼働停止に伴う出荷の圧迫を予想している。Arcadiaは顧客をサポートするため、メンテナンス期間に先立ち在庫を積み増す計画である。

DynaEnergeticsについては、業績予想は主力市場である米国での安定した井戸仕上げ活動を前提としている。経営陣は、コスト最適化の効果が原材料コストの上昇分を十分に相殺すると見込んでいる。NobelCladの出荷活動は引き続き改善する見通しである。

リスクと注視すべき分野

• 高金利が建設活動、特に大規模で長期にわたる商業プロジェクトの重荷となり続けている。
• アルミニウムの投入コストの変動と緊迫した労働環境は、Arcadiaとその顧客にとって引き続き圧迫要因となっている。
• 第4四半期の見通しは、DynaEnergeticsやNobelCladに影響を及ぼす可能性のある中東での軍事衝突に関連した国際サプライチェーンの混乱が拡大しないことを前提としている。
• 業績予想は、DMCグローバルの主力市場であるエネルギーおよび建設分野におけるマクロ経済環境の影響を受けやすい状況が続いています。
• ダイナエナジェティクスの防衛分野における機会は認定が必要であり、経営陣が数値化したり業績予想に織り込んだりするには時期尚早です。

アナリスト質疑応答の要点

• 防衛分野への事業多様化： 経営陣は、ダイナエナジェティクスが統合システムおよび起爆装置技術の空中・海洋ドローンへの応用可能性を評価していると述べました。この機会は有望ですが、認定の極めて初期段階にとどまっています。
• ダイナエナジェティクスの利益率： 経営陣は現在の実質的な収益性を維持可能とみていますが、販売数量が安定して推移する場合、利益率のさらなる飛躍的な改善は見込んでいません。調達における追加のコスト削減の可能性はありますが、販売数量の増加は主に絶対的な利益額の増加をもたらす見込みです。
• アルカディアの市場シェア： 経営陣は、アルカディアがサービス水準、製品の供給体制、顧客サポートを回復させたことで、2023年に失った短サイクル事業のシェアの大部分を奪還したと考えています。
• アルカディアの需要構成： 短サイクルの商業事業は、一部の長サイクルプロジェクトよりも高い利益率を有しています。高級住宅向けの需要は比較的堅調を維持していますが、生産能力およびプロジェクトの複数年にわたる期間という性質上、短期的拡大には限界があります。
• カリフォルニア工場のメンテナンス： アルカディアのアルマイト処理施設は12月末に約2週間停止する予定であり、計画的な在庫準備にもかかわらず、第4四半期の出荷に一定の圧迫をもたらす見込みです。

決算説明会文字起こし全文

決算説明会の完全なトランスクリプト

経営陣による説明

Operator

Greetings, and welcome to the DMC Global Third Quarter Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Geoff High, Vice President of Investor Relations. Thank you. You may begin.

Geoff High

Hello, and welcome to DMC's third quarter conference call. Presenting today are President and CEO, Jim O'Leary; and Chief Financial Officer, Eric Walter.

I'd like to remind everyone that matters discussed during this call may include forward-looking statements that are based on our estimates, projections and assumptions as of today's date and are subject to risks and uncertainties that are disclosed in our filings with the SEC. Our business is subject to certain risks that could cause actual results to differ materially from those anticipated in our forward-looking statements. DMC assumes no obligation to update forward-looking statements that become untrue because of subsequent events.

Today's earnings release and a related presentation on our third quarter performance are available on the Investors page of our website located at dmcglobal.com. A webcast replay of today's presentation will be available on our website shortly after the conclusion of this call.

And with that, I'll turn the call over to Jim O'Leary. Jim?

James O'Leary

Thanks, Geoff, and thanks to everyone for joining us. Today, we reported significantly improved financial results for the third quarter with both sales and adjusted EBITDA attributable to DMC well above year ago levels and comfortably above the high end of our guidance. These results were driven by initiatives implemented over the past 2 years to improve the performance of our businesses despite continued uncertainty and highly challenging end market conditions.

Consolidated third quarter sales were $172.8 million, a 14% increase versus last year's third quarter and a 10% sequential improvement. Reported EBITDA attributable to DMC was $19 million, which included $5.4 million of tariff refunds at DynaEnergetics. Excluding tariff refunds, adjusted EBITDA attributable to DMC was $13.6 million, a 59% increase versus the year ago third quarter and 48% above the prior quarter. Sales at Arcadia, our Building Products business, were up 25% year-over-year and up 14% sequentially. Adjusted EBITDA attributable to DMC increased 32% versus the year ago quarter and was up 23% sequentially.

This improvement was driven by higher sales of commercial aluminum framing products and high-end residential doors and windows. Arcadia's improved performance reflects its renewed focus on service levels and product availability in its short-cycle operations. Arcadia also benefited from higher residential sales and a large prestigious long-cycle project in Los Angeles during the quarter. These efforts offset still difficult market conditions and included elevated interest rates and materially higher aluminum costs, which continued to negatively impact larger longer-cycle commercial projects. However, we believe we have recently regained local market share in our key short-cycle operations due to the focused initiatives just discussed.

DynaEnergetics, our energy products business, delivered improved third quarter profitability on relatively flat year-over-year and sequential sales. Adjusted EBITDA was $11.9 million during the quarter, which included $5.4 million of tariff refunds. Excluding these refunds, adjusted EBITDA increased 34% versus last year's third quarter and was up 57% sequentially. The improvement was driven by cost-saving initiatives and a favorable sales mix that reflects Dyna's ongoing market diversification efforts with early contributions from the defense and enhanced geothermal sectors. Sales at NobelClad, our composite metals business, increased 38% year-over-year and 30% sequentially. Adjusted EBITDA increased 120% year-over-year and was up 51% sequentially.

NobelClad's improved performance resulted from increased shipments related to a record petrochemical order and the resolution of supply chain issues that had delayed shipments on a large defense order. Order activity was healthy during the quarter with significant new bookings from the energy, engineered wood and defense sectors. NobelClad ended the third quarter with an order backlog of $72.4 million, up from $63.5 million at the end of the second quarter. This included a quarterly record $16 million in orders related to U.S. Navy vessel construction.

Now I'll turn the call over to Eric for a closer look at our third quarter financial performance and our fourth quarter guidance. Eric?

Eric Walter

Thanks, Jim. I'll start with a review of our third quarter profitability. At Arcadia, adjusted EBITDA margin before NCI allocation was 14.7%, up from 13.8% in the year ago quarter and 13.6% in the second quarter. The EBITDA margin improvement principally reflects higher sales volumes across our commercial, residential and commercial interior product offerings, which resulted in improved fixed cost absorption. Excluding tariff refunds, DynaEnergetics adjusted EBITDA margin was 9.7%, up from 7.1% in last year's third quarter and up from 6.2% in this year's second quarter.

The improvements reflect the implementation of cost savings initiatives, a more favorable sales mix and a higher margin contribution from new end markets. NobelClad reported adjusted EBITDA margin of 15.9%, up from 9.9% in the year ago third quarter and 13.7% in the second quarter. The improvement was principally attributable to higher gross profit and lower SG&A. Third quarter SG&A expense was $27.5 million or 15.9% of sales versus 17.1% of sales in the prior third quarter and 15.6% in the second quarter.

Third quarter adjusted net income attributable to DMC, inclusive of tariff refunds, was $9.8 million or $0.48 per diluted share. With respect to liquidity, we ended the third quarter with cash and cash equivalents of $38 million. Net debt improved to $13.7 million, down from $18.7 million at our 2025 year-end and down from $30.5 million at the end of the second quarter. The decrease was primarily due to improved free cash flow of $16.6 million during the quarter from better profitability across our businesses, more stable working capital needs and the receipt of tariff refunds.

Now turning to guidance for the fourth quarter. We expect sales will be in a range of $154 million to $164 million. Adjusted EBITDA attributable to DMC is expected in the range of $10 million to $13 million. Our guidance reflects normal seasonal moderation in Arcadia, which will be further impacted by a temporary shutdown of our California finishing facility for planned maintenance, an expected decline in large, long-cycle project activity, the negative impact of still rising interest rates on construction activity, ongoing volatility in aluminum input costs and continued tight labor conditions for commercial and residential builders. Our guidance also assumes steady well completion in DynaEnergetics' core U.S. end market with the benefit from previously discussed cost optimization programs more than offsetting input cost increases.

Finally, our guidance assumes continued improvement in shipping activity at NobelClad. Our guidance does not contemplate increased disruptions in international supply chains due to ongoing hostilities in the Middle East, which could impact both DynaEnergetics and NobelClad, or generally weaker end market conditions. Moreover, our guidance remains highly dependent on macroeconomic conditions, particularly within our core energy and construction markets, and may change either positively or negatively as these factors evolve throughout the remainder of 2026.

And with that, I'll turn the call back over to Jim.

James O'Leary

Thanks, Eric. During the third quarter, we made progress on the cost-saving measures and targeted commercial initiatives implemented over the past several quarters despite continued economic headwinds in our core energy and construction markets. We believe our businesses are well positioned to capitalize when our end markets improve. We also now have continued to strengthen our financial position with net debt now at the lowest level since the Arcadia acquisition in December 2021.

I'd like to thank our associates across the company for their hard work and continued dedication during the past quarter and over several challenging years. And with that, we'd be happy to take your questions.

Operator

[Operator Instructions] Our first question comes from the line of Gerry Sweeney with ROTH Capital Partners.

質疑応答

Gerard Sweeney

I wanted to talk about the defense side. Obviously, that's a word I think that's first time it has come up in -- at least in the press releases. But on the defense side, you have your shaped charge business or technology and manufacturing as well as your detonator business. And I've seen some news out there, specifically like Teledyne Energetics getting some orders for, I guess, charges, specifically for drones. And that's an emerging opportunity. We have drone dominance, et cetera. Can you give a little bit more detail as to, maybe, what's going on, on this front, the opportunity? I know it's early stages, but maybe frame it out in any way possible.

James O'Leary

Sure. I'm glad you asked. And if you don't mind, at the risk of filibustering a little bit, we'll give you the background and why we thought it was worth mentioning. Only thing, not to correct you, but we have been talking about defense pretty extensively in NobelClad. But you're right, first time we mentioned it at DynaEnergetics -- no apologies necessary. But -- so we have been spending a lot of time turning over stones, looking at capabilities, all under the auspices of diversification.

And as you know and most of our shareholders know, in the perforation segment, we're one of the more -- in fact, I think we're one of the few fully integrated manufacturers of systems. And when we looked at where we would have other applications, geothermal is one, which we've talked about and defense, particularly, and you're right, it's the detonators, it's for drones. It's less for people like Teledyne or some of the established primes than it is for something that there's an article every single day in one of the mainstream newspapers. I think there's one today on -- in the Wall Street Journal about unconventional warfare, drones, both aerial and maritime drones.

And that is something that we think we have some unique capabilities for. They are not perfect. They don't fit like hand in glove yet, but it has been worth us spending the time. And the reason we mentioned it, particularly in Dyna, is it actually wasn't a small number. It wasn't material the way you think about it in the 10-Q, 10-K aspect. But it was about $0.75 million. And we thought we should call it out for 2 reasons. Number one, when you're doing your modeling, I back your margins off a little bit. It was -- this was kind of a bluebird that flew in the window. So when you kind of extrapolate the margins for DynaEnergetics, 50 to 100 basis points, I bring them down a little bit because we don't have anything in the guidance for defense. And we're really debating whether or not we put anything in the budget for next year, which obviously, we'll talk about quarter-to-quarter when we're into 2027.

But the reason we thought it was worth mentioning, number one, we don't want you modeling it and coming up with a number that's going to make you look silly at the end of the day. And this is more -- you've been around this company and the stock a lot longer than I have. When you look at the history of DMC Global, both for DynaEnergetics and NobelClad, every couple of years, something comes up out of the blue where it could end up being meaningful. We don't want people to be surprised to think we're working on things and we don't leave any breadcrumbs or Easter eggs around.

When you look at the history of Dyna, with DynaStage, NobelClad has many of these, if you go back a decade or so, where our applications and our capabilities are so unique and eclectic. Every now and then something comes out of the blue, and it's a real positive surprise. We've had a lot of negative surprises in the last couple of years. So we thought we should call out one of the positive surprises. Again, nothing that we can scope, nothing that we can give you the hard numbers on. But again, it was meaningful enough where we don't want it distorting your guidance, and we're excited about it. It's just -- you said it's early. We're not even in the second half of the first inning. So it's very early, but we're working hard at it.

And the one thing we called out specifically the NobelClad backlog for our applications in naval, particularly submarines, the backlog we've got there is meaningful. And the only thing that keeps it from being bigger, and again, it's not a next quarter or hopefully, it is a next year thing, but still too early. Between the Hanwha Yard in Philadelphia, the Anduril investment in Maryland, the first 2 meaningful investments in naval capabilities as far as building submarines and ships have been in the last 2 years. So that's one is probably more tangible and we're equally excited about. But hopefully, we can turn these opportunities into something meaningful for our investors.

Gerard Sweeney

Yes. Just on that front, I mean, just my understanding of just the detonator side, you have a lot of technology around not only setting off the detonator, is not only a charge but a software code. So -- and that's patented, and I think that's kind of unique. And I know you said it doesn't fit hand in glove, but my sense is there's a unique application with your DynaSelect detonator that may not necessarily be out there in the market as well. Is that a fair assumption?

James O'Leary

Yes. And I have a -- I don't want to say a huge amount, but I have a lot of experience from a former life with being a defense contractor. It does take a while to get qualified. Even though the Department of War puts out something every day and talks actively about accelerating the system, making the process go faster. And it is definitely happening in some of these unconventional applications, particularly drones. It hasn't happened yet. So we don't want to get ahead of our skis. But what we're doing is -- what we're trying to do is find applications for our capabilities that would unquestionably be a win-win.

Gerard Sweeney

Got it. I appreciate that. And then just switching gears real quick to Arcadia and I'll jump back in line. Obviously, it sounds like you've taken some share back, especially in the short-cycle business. The longer cycle is maybe a little bit more constrained for the reasons you mentioned. Just curious, 2 things. One, is there some more share to be taken? Or are we back to where you should be? And then just separately, any update on Pacific Palisades, maybe an opportunity as that develops more building permits are put in place?

James O'Leary

So I think we've either regained most of the share we probably lost in 2023, fast forward up to when Jim Schladen came back, or if we haven't regained most of it, it's probably at the point of diminishing returns now. For the first couple of quarters, Jim was probably a bit frustrated. It took a little longer than he expected. He brought back a lot of his teammates who had left or kind of wandered off the reservation for over a period of a couple of quarters when we made personnel changes that, with the benefit of hindsight, we probably shouldn't have made. So I think we've got the early returns. There's probably -- if there is a little bit more, it really is just a little bit more. But hey, I mean, that's something, and it gets us back to a run rate that we're comfortable with outside of the broader economy.

On the broader economy, we're not expecting permits to pick up. We're not expecting any robust jump start to the construction economy. And I'll tell you, it's truly, truly terrible out there. It's definitely the worst I've seen since 2008 and '09, as long as interest rates are where they are, which is still at -- I'm not sure if it's 20- or 30-year highs right now. It's tough sledding, and we're just going to have to keep at it. Besides the local market share regaining, we are doing pretty well on the residential side, where most of those are cash purchases, very little influenced by interest rates.

The constraint there is production constraints. There's only so much we can get through our factory right now. And the type of buyer who [ are ] there, they're typically multiyear projects, not tract building where you're banging them out every month or every quarter. And locally, there are a lot of improvement opportunities in adjacent markets. We're looking at, are there any satellites or any other opportunities that we haven't pursued in the last few years that Jim had on his to-do list back in 2021. So there's a couple of things like that, but those are longer term, meaning a few quarters, maybe a year or 2 out initiatives that we're pursuing.

Gerard Sweeney

Got it. All right. Well, congrats. Nice quarter. Even if it was a bluebird, I'll take it any day of the week.

James O'Leary

Sometimes you see one bluebird and the whole flock is right behind it.

Operator

Our next question comes from the line of Ken Newman with KeyBanc Capital Markets.

Kenneth Newman

Maybe for the first one, I think if my math is right, it looks like gross margins for Dyna were around 18% after backing out the tariff refund in the quarter. Obviously, it sounds like, Jim, you mentioned there's some moving pieces in that business just given the defense wins you talked about earlier. But I'm curious if there's a way to think about whether those segment margins could see another sequential increase in the fourth quarter if the volumes remain stable quarter-over-quarter? Really, I'm just trying to level set about how much more opportunity for margin outperformance on the cost optimization program is left?

James O'Leary

So I think about it more in terms of absolute dollars. I think they're sustainable. I wouldn't expect them to be scalable or to have another step function up. Most of the cost savings came from 2 buckets, one being product design and the other one being sourcing initiatives. There's probably a little bit more juice in the sourcing lemon to squeeze. We're always looking, at or at least more aggressively looking at additional product design. But those are -- the unit economics there are the more you sell, you're going to get more absolute dollars, but the margins don't ramp up.

We do have some improvement, we think, but it's not -- or it shouldn't be the type of step function up, and we wouldn't want you thinking that's going to be there when you're doing your modeling. If volume did go up -- and remember, volume was actually down this quarter, particularly in the Americas. And despite all the talk and all the consternation about the Middle East, with all the strategic reserves depleted, is there going to be a big wave of production increases? If that happens, we're very well positioned. Supply is pretty tight. But right now, volumes, even though rig count and spreads are up, they're only up between 5% and 10%.

It depends on which was the last call you listened to, whether it was Halliburton, Liberty, somebody else. The numbers are kind of up and down and it averages out to about 5% to 10% up. We were actually down, and that's not -- it's really not a loss of market share or a loss of wallet share. It just who we happen to sell during the quarter on what's still -- rig count is still only around 600. So if volume really took up, there'd be the volume benefit from gross margins. But if volumes stayed the same, I think you should expect it to be about the same as this quarter.

Kenneth Newman

Understood. That's really helpful. Maybe switching gears. You mentioned this -- the expectation for a seasonal moderation in Arcadia with this temporary shutdown in California. Can you just talk a little bit about what this maintenance shutdown actually is? And is there a way to size up just what you're expecting there from the shutdown? How long does that take? How much of the volumes kind of go through that facility?

Eric Walter

Yes. Ken, this is Eric. There are kind of 2 things going on there. One is just the seasonality of it. There's just less construction activity that's going on with our customers. So we would normally see the revenue start to trail off, particularly in November and December because of the holidays and the weather. But to your question around the maintenance, we have one of our anodizing facilities where we're going to be going through and doing some maintenance on that. We think that, that facility is going to be down for probably 2 weeks at the end of September -- or sorry, end of December. And when it's down, obviously, we won't be able to produce anything. We're going to build a little bit of inventory in the quarter to try to service customers. But we think overall, it will put some pressure on getting shipments out. And so that's why we're guiding to a little softer top line performance from Arcadia on a quarter-over-quarter basis.

Kenneth Newman

Understood. Okay. That's helpful. Maybe if I could just squeeze one last one in, just a quick one. It was helpful for the color on the short-cycle demand versus the longer cycle mix in Arcadia. Can you just -- can you remind us like where -- how large is the mix of the shorter-cycle commercial high-end nonresi side kind of trending nowadays? And then maybe just an add-on to the earlier question on how you think that mix continues to shift in the next couple of quarters?

Eric Walter

Yes. When you look at the revenues for Arcadia, the short-cycle commercial business is roughly half of that. So this would be stock length sales, it would be doors, but typically smaller projects where we would provide the product, ship it out within 4 to 6 weeks. The long-cycle part of the business would be roughly 25% of Arcadia sales. And then the residential 15% and the balance would be what we call Wilson, the interiors business.

The short-cycle business, not only is it a considerable part of the revenues, but it tends to have higher margins than some of the long-cycle business. The short-cycle business is something that typically goes through an RFP like the longer bigger projects. And so those customers, when Jim was talking about winning back some business and we think that we're taking back some market share, it's really with those customers. And so we've reestablished our service levels, product availability and have the customer support staff in place so that we can better service that customer and win back some business that we had lost in the prior year.

James O'Leary

It's really kudos to the Arcadia team because they came in, it was a little challenging. They stabilized it, and they got it moving in the right direction. I do think we're at the point of diminishing returns. But if we did lose something, it's good to get it back, and it's good to regain the trust of our customers, which, quite frankly, Arcadia was built on that.

Operator

Thank you. And we have reached the end of the question-and-answer session. Therefore, I'd like to turn the call back over to Jim O'Leary for closing remarks.

James O'Leary

Sonali, thank you very much. And to employees who have been working unbelievably hard the last couple of quarters, the last couple of years and some of our longest-serving shareholders who've hung in there. Thank you very much. We will talk to you next quarter. And with that, Sonali, it is a wrap.

Operator

Thank you. And this does conclude today's conference, and you may disconnect your lines at this time. We thank you for your participation.