ANSYS, Inc. (SNPS) Earnings Call Transcript & Summary

Good day, ladies and gentlemen, and welcome to the Synopsys Special Event Call. [Operator Instructions] As a reminder, today's call is being recorded and will last approximately 1 hour. At this time, I would like to turn the conference over to Trey Campbell, Senior Vice President, Investor Relations.

Thanks, Todd. Good morning, everyone. With us today are Sassine Ghazi, President and CEO of Synopsys; Ajei Gopal, CEO of ANSYS; and Shelagh Glaser, CFO of Synopsys. Before we begin, I'd like to remind everyone that during the course of this conference call, Synopsys may discuss forward-looking statements reflecting its views with respect to the proposed transaction between Synopsys and ANSYS, including the anticipated benefits and closing of the transaction, market outlook, customer demands, products and business of each company and the combined company, expected combined company future operating results and financial performance, costs and revenue synergies resulting from the transaction and opportunities, strategies and technological and software trends, including AI. While these statements represent our best current judgment, expectations and assumptions as of today, there are many other risks, uncertainties and factors that could cause actual -- or our actual results and future events to differ materially from what we expect. In addition to any risks that we highlight during this call, you should carefully consider any other risks and uncertainties that affect the businesses of Synopsys and ANSYS described in the Risk Factors section of the respective annual reports on Form 10-K, quarterly reports on Form 10-Q and other documents filed by either of them from time to time with the SEC, including today's press release. We do not intend to update or revise our forward-looking statements or projections unless required by law. In addition, we will refer to certain non-GAAP financial measures during this call. Reconciliations for certain historical measures of each company can be found in prior earnings releases and financial supplements. Materials related to the transaction in this investor presentation are available at www.synopsysansys.transactionfacts.com. In addition, the prepared remarks will be posted on the transaction website at the conclusion of the call. With that, I'll turn the call over to Sassine.

Thank you, Trey, and good morning, everyone. Today, we announced our plan to acquire ANSYS, a leader in simulation and analysis, to advance our strategy and create a leader in silicon to system design solutions. This transaction builds on our 7-year strategic partnership, which has achieved strong customer momentum, and now we're taking the next step. The complexity of system design is driving our customers' needs for the fusion of electronics and physics augmented with AI. We're combining a leader in semiconductor design technology with a leader in simulation and analysis to address this rapidly emerging customer need. This transaction will enhance our silicon to system strategy, both across our core EDA segment and in highly attractive adjacent growth areas where ANSYS has an established presence and successful go-to-market experience. The combination will expand our TAM by 1.5x to approximately $28 billion and create significant long-term value for our shareholders. Shelagh will discuss the financials in more detail. At Synopsys, the mission is to empower technology innovators, igniting their ingenuity and maximizing the capabilities of their R&D teams. Delivering on this mission resulted in nearly $6 billion of revenue in 2023, which grew 15% year-over-year with a 35% non-GAAP operating margin. First, let me anchor you on our 3 strategic priorities: technology and innovation leadership, industry-leading growth and margin expansion. Innovation is at the heart of what Synopsys has done for the last 4 decades. Over the last 3 years, we have established leadership across the EDA stack at today's leading-edge nodes while enabling the industry transition to multi-die. We also pioneered AI and cloud for chip design while developing the next-generation IP that is enabling all the leading foundries. Our second strategic priority is industry-leading growth. We achieved a 17% revenue CAGR over the last 3 years and have expanded into new adjacent growth opportunities in software-defined systems to stay ahead of customer needs. Finally, we have expanded our non-GAAP operating margin by 7 points over the last 3 years and continue to raise the bar, committing to another 2 points of expansion for this year, all of which has led to shareholder returns that have far outpaced the market. Over the last 3 years, we have delivered 120% total shareholder return, approximately 3.5x the TSR of the S&P 500. To set the stage for this transaction, let me briefly describe our view of the world, which underpins our strategic priorities. We have entered an era of pervasive intelligence when AI and smart technologies are seamlessly integrated into the fabric of our daily lives, becoming omnipresent and interconnected. This era is being shaped by megatrends, including the rise of AI, the proliferation of silicon everywhere, the growing movement towards software-defined systems and the looming intersection of electronics and physics. These megatrends are pushing the need for advanced chips and new system design methodologies across verticals such as aerospace, automotive and industrial equipment. The world of semiconductor design and physical simulation and analysis must come together to ensure interconnected systems function properly in real-world settings. Semiconductor companies must now design in a world of high-performance computing with a system approach in mind. Similarly, systems companies must move down to the silicon level to unlock value with purpose-built chips and software-defined systems. This is creating new complexity challenges that this combination will help solve. Chips are being designed at smaller scales than ever, approaching [ angstrom ] scale. Silicon, software and hardware need to be codesigned for optimal results. While systems from connected cars to medical devices must also be able to be monitored and optimized in the field. We have been deliberate in our strategy to expand from silicon to system designs for years. As part of the regular review of our strategic plan in 2021, we identified systems and simulation as a priority for future growth. Today's announcement is a direct result of that process, particularly as we think about how we build on our ANSYS partnership to meet our customers' increasingly complex challenges. Since 2017, the 2 companies have partnered closely to solve design complexity. A great example is the industry-leading digital implementation platform, Fusion Compiler, which integrates power integrity from ANSYS RedHawk into a unified offering. Today, the vast majority of Synopsys Fusion Compiler installed base incorporates ANSYS technology. Our integration also extended to Synopsys 3D IC Compiler, the industry's first unified platform for multi-die design. Beyond technology integration, we have developed deep joint go-to-market relationships and have both been pioneers in infusing AI into our respective platforms. But what works today to solve design complexity won't suffice in the future. Only by approaching design and novel ways can we meet our customers' rapidly evolving, increasingly complex design needs and shortened development cycles. Our customers are moving from monolithic chips to multi-die systems. These systems are so dense and so complex that they require not only power integrity but sophisticated structural, thermal and electromagnetic analysis to deliver high-performing and high-yielding chips. And equally important, customers are moving to co-optimized intelligence systems that require a whole new level of design complexity across multiple domains. As you can see, we need to deepen our integration to deliver unified products that meet these customer needs. Joining forces with ANSYS is the next logical step. ANSYS is a leader in simulation and analysis, particularly in electronics. According to a third-party survey of simulation users, ANSYS has best-in-class technical capabilities and leads in innovating and unlocking new use cases. This positions us to truly fuse our capabilities to deliver unified products that meet our customer needs and create a leader in silicon to systems design solutions. This combination accelerates our strategy on 2 vectors. On day 1, we will significantly extend our portfolio of solutions that we can offer our customers as we work on our integrated products road map. This includes not just electronics but also other physics such as structures, fluids and optics that are essential across industries. We expect the combined company will benefit not only from immediately accelerating the penetration of high-tech customers through cross-selling opportunities but also from customers and other high-growth adjacent verticals that are now also demanding multi-domain fusion solutions such as aerospace, auto and industrials. ANSYS' significant presence in these underpenetrated verticals and established go-to-market approach with these customers, which account for nearly half of its revenue, represents a huge opportunity for the combined company. Additionally, I'll note that our Chief Revenue Officer, Rick Mahoney, was previously the CRO at ANSYS and brings a deep understanding of ANSYS' go-to-market motion and its customer base and their needs. This combination is expected to increase our TAM by 1.5x to approximately $28 billion. We expect this combined TAM to grow at 11% annually through 2028, driven by the megatrends we discussed. Given the capabilities of the combined company, we expect to grow revenue faster than the TAM. The combined company's enhanced ability to invest in AI and cloud solutions, which underpins everything we do, is another huge benefit to this transaction. While we're leaders in leveraging AI and cloud solutions in our respecting -- respective fields, we think we've only just scratched the surface of what's possible. Through this combination, we will have a range of cutting-edge capabilities, including a highly talented workforce with deep engineering expertise, a R&D budget that's approximately 2x the median of industry peers to unlock value for the full spectrum of customers and cross-domain system data that covers in design to infill. With a common underlying technology know-how, together we'll also be able to more efficiently invest in these areas than either company can on its own today. This slide provides a high-level overview of the transaction structure. As you can see, Synopsys will acquire ANSYS for $197 in cash and 0.345 shares of Synopsys common stock per share of ANSYS. Following close of this transaction, ANSYS shareholders will own approximately 16.5% of the combined business. We intend to fund the $19 billion of cash consideration through a combination of cash and debt and have obtained $16 billion of fully committed financing. We are targeting to close in the first half of 2025 subject to customary closing conditions, including receipt of regulatory approvals. And with that, I'll turn it over to Ajei.

Thank you, Sassine. It is a pleasure to be with you and Shelagh this morning as we embark on an exciting new chapter for both of our companies. I share Sassine's enthusiasm for the combination of ANSYS and Synopsys and strongly believe that this transaction has the power to be transformative for our customers, our partners and the entire industry. With that in mind, I'd like to take this opportunity to share some more information about who ANSYS is today and why I believe our business is well positioned to accelerate its momentum in the years to come. ANSYS' mission is to power innovation that drives human advancement. Since our founding in 1970, we have worked alongside some of the world's most visionary companies, enabling businesses across industries to push the boundaries of product design by using the predictive power of simulation. As a leader in simulation and analysis, our business today is strong and growing. Supported by a highly diverse and recurring financial model, ANSYS has a best-in-class product portfolio and thousands of customer relationships across diverse geographies and industries. Our deep strategic relationships with our customers have created a robust recurring annuity, driving consistent top line growth, industry-leading margins and strong operating leverage. As you can see, we have strong recurring ACV of more than 80% and a track record of consistently delivering double-digit ACV growth. We're pleased to be entering this combination today from a position of strength. Additionally, today, we announced that our preliminary results indicate that our fourth quarter ACV is expected to exceed the high end of our guidance, which results in 13% ACV growth for 2023. Longer term, we are confident in exceeding market growth and delivering on our model of 12% constant currency ACV CAGR and $3 billion of cumulative unlevered operating cash flows from 2022 to 2025. Simply put, we have a strong track record of delivering against the best-in-class model of double-digit growth with industry-leading margins and strong operating leverage. Our business is strong, and we believe that together with Synopsys, we will unlock new opportunities to further accelerate our success and deliver even greater value for our customers, partners and shareholders. We also believe that combination will open new opportunities for our employees. Both companies have world-class teams, and a larger company will deliver additional opportunities for those personnel to grow their careers. At ANSYS, our talented team of over 6,000 employees is singularly focused on delivering cutting-edge simulation and analysis for our customers. For decades, we have continually invested in innovation to position ANSYS as a partner of choice for customers. Global organizations understand that ANSYS' expertise and deep and broad portfolio of multiphysics solutions can help them solve their key product and business challenges. And they increasingly rely on our team to address new product goals that include safety, price, functionality, reliability and performance. By joining forces, ANSYS and Synopsys will accelerate the development of our combined portfolio and deliver an increased level of innovation to market, which will also benefit the most traditional of ANSYS customers. As we thought about ANSYS' future, it was important to us that we pursue a path that would further accelerate our great progress as well as maximize the value we deliver for our stakeholders. With that, I'd like to speak briefly about how we got to this transaction. Following a comprehensive and competitive process to determine the right path forward for ANSYS, which was conducted with the assistance of independent legal and financial advisers, our Board of Directors unanimously agreed that the transaction with Synopsys was in the best interest of our company and our shareholders. As Sassine mentioned, we know Synopsys' business well and have deep respect for their team and our shared spirit of innovation. This transaction represents a premium of 29% over ANSYS' closing price on December 21, 2023, and a premium of 35% to ANSYS' 60-day volume-weighted average price for the period ending on the same date. The cash and stock structure provides certain cash value to ANSYS' shareholders, along with the opportunity to participate in the combined company's long-term growth potential. This transaction with Synopsys is the next natural step for our 2 companies By merging our simulation and analysis solutions with Synopsys' EDA technology, we will create a stronger, more diversified product portfolio that is best positioned to meet the evolving needs of today's engineers. And in this next chapter, we expect to amplify our impact. Together, Synopsys and ANSYS will give engineers unprecedented insights into the performance of their products from the behavior of semiconductor chips built using the latest 2-nanometer technology to spacecrafts operating millions of kilometers from Earth. In short, we're bringing together the best of both companies to drive new levels of customer innovation. This is an incredibly exciting proposition, which will benefit all our stakeholders. I want to extend my appreciation to my amazing colleagues for their dedication and commitment to ANSYS and to our customers around the world. This transaction is a testament to the work they do every day. Thank you all for joining us as we embark on this journey to create a leader in silicon to system design solutions. I'll now turn the call over to Shelagh. Shelagh?

Thank you, Ajei. Let me provide the financial details. For fiscal year 2023, Synopsys and ANSYS generated a combined $8 billion of revenue. And we expect the combined company to grow revenue at industry-leading double-digit rate annually for the near term, outpacing TAM. The transaction is expected to immediately expand margins, increasing Synopsys non-GAAP operating margin by approximately 125 basis points for the first year post close and by approximately 250 basis points in the medium term. We also expect unlevered free cash flow margin to expand by approximately 75 basis points the first year post close and by approximately 250 basis points in the medium term. In addition, we expect to realize significant synergies: $400 million of identified and actionable run rate cost synergies by year 3, $400 million of run rate revenue synergies by year 4, growing to over $1 billion annually in the long term. We believe the transaction will be accretive to non-GAAP EPS within the second full year post close and financially accretive thereafter. At transaction close, we expect our gross debt to adjusted EBITDA to be approximately 3.9x. Subsequently, we expect to generate substantial and sustained free cash flow, which will enable us to rapidly delever to less than 2x within 2 years of the transaction close. Our long-term gross leverage target is below 1x, and we expect to maintain investment-grade credit ratings, given our strong cash flow generation and commitment to rapidly delever. We intend to resume buybacks as we approach our leverage target of below 2x. Let's take a closer look at the projected synergy. By year 3, we expect to realize $400 million of run rate cost synergies through various initiatives. This is driven by streamlining and realizing the benefits of the greater scale and integrating engineering platforms and technology reuse for AI and cloud. By year 4, we expect to realize $400 million of run rate revenue synergies from our combined silicon to systems customer base and our go-to-market strength, including integrated multiphysics systems analysis for advanced chip design, expansion of direct account coverage for ANSYS portfolio in the semiconductor high-tech sector and accelerated expansion in automotive, aerospace and industrial equipment. Over the longer term, these identified synergies are expected to grow to $1 billion annually. We believe our combined capabilities have the potential to unlock significantly more revenue synergies that are not included in these estimates, including further penetration beyond our existing verticals as well as new joint innovative solutions. On to our combined company long-term financial objectives, which are multiyear. Our goal is to drive shareholder value by delivering annual industry-leading double-digit revenue growth, non-GAAP operating margins in the mid-40s, unlevered free cash flow margins in the mid-30s and high teens non-GAAP EPS growth. We intend to utilize our strong cash flow or debt pay down as our first priority, continue to invest in organic R&D and as we approach our leverage target of below 2x, resume stock buybacks. With that, I'll turn it back to Sassine.

This is a transformational milestone, our biggest acquisition ever. And of course, a successful integration is critical to recognizing the full value of this combination. So our Board and management team are keenly focused on solid integration execution. With our successful track record of strategic integrations and our strong existing partnership with ANSYS, we're confident in our ability to seamlessly integrate our leading capabilities to meet customer demand. This is a transformational milestone for both companies, one that will enable us to capture the significant opportunities in front of us and solidify our position as a pioneer at the core of key technological innovation for years to come. Together, we will win in an evolving industry landscape and deliver even greater value to all our stakeholders. Operator, you may now open up the call for questions.

[Operator Instructions] Our first question will come from Harlan Sur with JPMorgan.

Congratulations on the announcement today. As you mentioned, if you look at the trends in the tech sector today, right, what we always say is great semiconductor companies are becoming more systems-focused, right, NVIDIA, AMD, Broadcom, right, just to name a few. So big users of Synopsys tools but more and more ANSYS solutions. And then on the flip side, systems companies, auto, industrial, aerospace and defense, cloud and hyperscale titans are opting to design their own chips, so big ANSYS users today but more and more EDA solutions. So on the revenue synergy side, the trends are already in place but what percentage of Synopsys' customers use ANSYS tools today? What percentage of ANSYS customers use Synopsys solutions today? And where do you see these percentages moving over the next few years as the team unlocks revenue synergies?

Thank you, Harlan, for the question. You captured it very well, and that's really the intention behind this combination. As you stated, more and more silicon companies are trying to design sophisticated silicon, and you can think of it as multi-die in a system to serve for a specific system application. And each system application has their different requirements and needs. Those silicon complexity is driving the growth that we're seeing in our core EDA and IP business. And as you know, the multi-die system is where the partnership with ANSYS starting -- started around 2017-time frame, where we wanted to address the customer challenges around thermal power integrity, et cetera. And as you can imagine in the last 7 years, with more sophistication in those advanced packaging, that integration became more critical. As I mentioned in my prepared remarks, today, the majority of our Fusion Compiler customers that are designing those advanced multi-die systems are using ANSYS as part of the Synopsys offering when we deliver to customers. So today when we're selling Fusion Compiler, our sales team and our AEs are supporting and selling the RedHawk and other technology to integrate and deliver that solution to our customers. In terms of system companies designing silicon, of course, any system company designing silicon is a customer of Synopsys as well. Now those system companies, they have more needs than just designing silicon. They're looking at the whole system, meaning the electronic, the electrical, the mechanical, the whole system. And this is where it's very attractive, the ANSYS position that exists in those system companies. So again, as I mentioned in the prepared remarks, there is the silicon to systems and the system down to silicon combination that we're very excited about in this combination.

Perfect. And then, Shelagh, on the $400 million in run rate cost synergies by year 3, roughly, how much of that is coming from COGS versus R&D versus SG&A?

It will be a combination, Harlan. I mean we will have enormous scale, obviously, as we bring these 2 companies together. And just as we've been driving over the last several years as Sassine shared, obviously, we've had a 7-point improvement in op margin. We're really going to drive that leverage and scale capability across both companies. And we do see the ability to continue on that journey, which is why we're also setting our goal for operating margin in the mid-40s.

Our next question will come from Joe Vruwink with Baird.

Great. Congrats to both your organizations. My first question, it does speak to revenue synergies as well. But when I think about the wallet share of R&D budgets that your 2 organizations see, a chip company might spend 10% of R&D on EDA solutions. I think across the broader ANSYS audience, they are may be spending the equivalent of 1% on simulation. There's still quite a bit of physical testing and prototyping out there. I guess my question is where do you think these wallet shares go as customers pursue silicon to system strategies? And does a higher share of wallet get unlocked by joining your 2 companies together?

Thank you, Joe, for the question. As you know, the R&D share of wallet is typically -- or typically increases as complexity and need increases. In the EDA world, as you remember not too long ago, about 8, 10 years ago, it was around 10%. It's been increasing now. It's roughly around 13% or so, and the increase is due to complexity. I'll let Ajei comment regarding the system companies or in the traditional simulation and analysis companies where that percentage is. But it's not in the 1-ish or low single digit. It's actually in the mid to upper but I'll let Ajei comment on the percentage of R&D for simulation and analysis.

So Joe, great question. I think you're making the point that there is a lot of opportunity for the expanded use of simulation within our customers. And you're absolutely right. And it's obviously driven by a number of dynamics. Number one, when you consider the value of simulation, it really is about helping customers in complexity. And as Sassine pointed out, as we're building these next-generation products that include -- require multiphysics analysis as we've discussed many times, that require an understanding of how silicon integrates with system analysis. All of that increases complexity. And with increased complexity comes the need for greater use of technology that allows customers to understand that complexity and to deliver next-generation products to market. So we are very excited that -- we are very excited certainly as -- with the ANSYS ability to continue to grow and address these emerging use cases with complexity. And of course, we're even more excited when you consider the combination of how by working together, the Synopsys-ANSYS portfolio will allow customers to take it even further to address the complexity that they're dealing with in the market.

That's great. And then second question, I think one of the most frequent questions I've got in front of investors is just why a deal now considering your 2 companies have worked together since 2017? I guess how much is this a function of maybe purchasing paradigms or strategically how R&D managers are thinking about it where this is a very real opportunity only now beginning to come up in terms of kind of a shared product road map that makes more sense to join you 2 versus more in-house ASIC teams within industrial customers? What would you kind of point to in terms of the timing logic?

Sure, Joe. As I mentioned in the prepared remarks, around '21-time frame and our yearly strategic planning, we identified 2 areas of growth for Synopsys. One is systems, and the other one is the whole simulation area. And the reason for that is back to Harlan's question, the trends in the market from silicon to systems has been happening for a number of years now. And that's accelerating our growth and the customer need for sophisticated EDA and IP to design the silicon but that silicon needs to be designed in the context of a system. You've been hearing us talk about the silicon to systems as well as the electronics digital twin. In other words, how do we create a model for these chips so system companies can run their simulation early -- develop their software early. So with those trends, it became very apparent that co-optimizing between those multiple domains is a necessity and a problem that our customers are seeking help to solve in order to deliver to their product innovation. So we've been very deliberate building on our partnership since 2017. And ANSYS' strong position with these market verticals and their deep roots of product trust with our customers and future customers made that decision fairly attractive and timely to pull the trigger right now.

Our next question will come from Jay Vleeschhouwer with Griffin Securities.

Perhaps as a clarification for all of us. When you refer to revenue synergies, are you referring specifically to the cross-selling of integrated products? And maybe just to find that for us first. And then specifically, the $400 million you're talking about in year 4 would represent the equivalent of only 5% of today's combined revenue. So presumably a smaller percentage of your future revenue. So that would seem to be a relatively conservative contribution from the synergies as part of the forecast. Can you maybe talk about what you're thinking is in that number? And then as the follow-up, what do your forecasts anticipate vis-a-vis ANSYS' revenue model, which is quite different from yours. They're still heavily reliant on perpetual and term licenses. Would you expect that over time, you might convert more of their business to your more subscription-oriented model?

Sure. Let me take that question. As we thought about revenue synergies, you're right, we took a very balanced view of line-of-sight revenue synergies. We know those are something that we're going to look to continue to improve on over time but we really took a line of sight. And it's really based on looking at our deep understanding of both the technology and the customer base. As Sassine mentioned, we already have had partnerships with ANSYS from 2017. So the synergies in the $400 million are driven by selling integrated multi-physics analysis for the advanced chips, some of the solutions that Sassine was talking about in terms of supporting our customers on multi-die. It's also expanding account coverage into the ANSYS portfolio for semiconductor and high tech, and then further acceleration of our products on the Synopsys side in automotive, aerospace and industrial, which is those last 2 being more cross-selling, as you're talking about. And as we're thinking about growing those capabilities over time, they obviously, over time, will get infused with new innovative products that we'll be able to jointly produce, which is why our long-term goal on that $400 million synergies once we've got that to fruition is closer to $1 billion. In terms of the model, obviously, the ANSYS technology is infused across many, many customers. We intend to continue that broad diffusion and look for broader diffusion of our EDA and IP as more customers -- systems customers move to wanting to either architect or design silicon. And then in terms of the change in business model, we're not anticipating a change in the business model between the 2 companies. We have -- they've been moving into a subscription business model. I might have Ajei comment on that. Over the last several years, they've moved quite a bit of business into a recurring model, and we anticipate continuing to drive forward on that. Ajei, do you want to make a comment?

Sure. Jay, as you know, about 83% of our ACV comes from recurring sources. And that obviously reflects the strong relationships and the strong technology penetration that we have within our customer base.

Our next question will come from Vivek Arya with Bank of America Securities.

I had 2 as well. So first, on China approval, will it be required? And just what are the dynamics, given some of the recent restrictions on ANSYS but Synopsys having a strong presence in China? So I'm just curious, Sassine, what is your read on whether the China approval will be required? And how long could it take? And will it require any kind of divestitures or other assurances that need to be made either to China or to U.S. regulators?

Thank you, Vivek, for the question. As you can imagine, we did not jump into this combination without a clear expectation that the regulatory review will be manageable. We were fairly well advised and prepared throughout the discussion around this transaction. And we both are very committed to closing this deal. Now regarding specifically China, I really don't want to speculate at this point regarding the process. But the one thing I will assure you and our shareholders is our commitment to do everything possible to close this deal. And on the ANSYS and I'll have Ajei comment as well regarding some of the restrictions. Now as you know, the vast majority of ANSYS products are not subject to the U.S. export licensing requirements. And we've had a number of discussions with ANSYS, and we feel very comfortable with their not only commitment to comply but their guardrails that they have in place in order to comply with the export control. Ajei?

Yes. Thank you, Sassine. And as we said in our Q3 earnings call, we have put in place some additional incremental approval processes on sales of certain ANSYS products and services to entities that are performing R&D or certain control activities in China. And we've internally adjusted our business operations to take into account these new bedding requirements. And that result is really a little bit of an increase in the time that it takes us to process transactions for certain prospects that are located in China. And of course, despite these developments, as -- our business is performing well. And as I mentioned on the call, we gave you an early insight into our Q4 results.