General Motors Company (GM) Earnings Call Transcript & Summary

Okay. And I think we are live. Great. Welcome, everyone. My name is Dan Levy, I lead autos research coverage at Credit Suisse. I'm very glad you can join us as we continue Credit Suisse's 9th Annual Industrials Conference, the autos track of the conference. Very pleased to have with us General Motors and who -- Paul Jacobson, GM's CFO, who really needs no introduction. So the format is going to be Paul is going to deliver some opening remarks, then we'll go through some questions fireside chat style. [Operator Instructions] So with that, Paul, thank you so much for joining.

Well, great. Thanks, Dan, and thanks for having us today. Today is a pretty special day for me. It's my 1-year anniversary of starting at General Motors. And what an exciting year it's been and what an exciting time for the company. And as we articulated at the beginning of October, we've got very ambitious plans as we migrate on this journey from automaker to platform innovator. And along the way, double our revenues, while expanding our margins to about 12% to 14% by the end of the decade. We've got all the resources in place. We've got the right strategy. We've got the people, we've got the facilities. And most importantly, we've got the products and look forward to spending some time talking about that with you today, Dan. And what I wanted to do in our opening comments is just give you a little bit of an idea of the state of the business as we have seen in the near term since producing our earnings guidance about a month ago. We've seen continued strength in the consumer. Obviously, there's some winds of caution out there with the Omicron variant that we're all watching very, very closely. But I'm pleased to say that we've experienced a little bit of favorability on costs and volumes have been trending higher than we expected them to be, primarily on chip availability just from what we've seen just a few weeks ago. And consequently, our fourth quarter is coming in stronger than where we expected to be just a month ago. And we now see our full year EBIT adjusted in the sort of $14 billion-ish range, higher than our previous outlook of the high end of our $11.5 billion to $13.5 billion range. So really, really pleased to report that today. And all signs are pointing to good trends in the business. And I'm sure we'll spend a little bit of time talking about 2022. We'll give formal guidance on February 1 when we announce our earnings going forth. But what I would say is as we're finalizing our budget, our 2022 projections in our budget are very much in line with our long-term plan that served as the basis for what we laid out. We see the ability to generate 10% margins in 2022 as we continue to transition the business to electric vehicles and platform innovator status. And most importantly, I think we see some of the trends in semiconductors improving throughout the year. And I'm sure that will be something that we talk about. So as we continue and as we wrap up this first year, my first year here, I really couldn't be more excited about the future and where we're going. We are really driving this company into a technology-driven growth platform, which I think is once in a generation opportunity. We've seen businesses change. We've seen businesses transform. But I think at the end of the day, the industry transformation that's happening right now is that once in a lifetime opportunity, and I'm really excited about what GM is poised to do going forward as we transform ourselves within that backdrop. So thanks again for having us, Dan, and look forward to, hopefully, a very robust second year with you.

Great. Look, before we go into some of the more near-term items, let's just talk broadly about that transformation. Maybe you could just give us a sense of how far along you are in the work to establish the platform and how we think about the key milestones or the KPIs along the way?

Yes. No, that's a fair question, Dan. And as I've articulated in a number of different forums that I think of Investor Day as kind of Phase 1 of a communication strategy in which we laid out the long-term goals. We really want to change the way that people think about General Motors and where we're going and what the basis for our growth is. And I think as we get into Phase 2, it's really about how do we set those milestones, how do we set those key success indicators to make sure that people understand that they can measure us on the journey that we are undertaking and what we're at the beginning stages of. So I think it first starts with getting the EVs out on the road. And I think going forward, you're going to see a much, much faster trajectory going forth. We will roll out the first of the Hummer EVs this month. We will have the Cadillac LYRIQ out in 2022 in Spring Hill. And obviously, you saw the grand opening festivities at Factory ZERO. So I think 2022 is going to mark some really good, strong key milestones. We'll open our first Ultium cell plant, Lordstown will come online in the middle part of the year. And then at CES just a few weeks away, we will officially reveal the Silverado E. And I think I'm proud to say you're going to be really, really excited about what you see. And I think it's going to go over really well. We've teased a few features of it, including at Investor Day. But that vehicle is going to be really strong. And then when you look at our autonomous investments, Cruise is just 1 permit away from sort of commercialization of robotaxis and autonomous rides. That is such a core part of our integrated strategy, as we've talked about leading in both EVs and AVs. And we expect to see that on the cusp of opening up a massive new TAM for us going forward. So you're going to continue to see EVs rollout. You're going to continue to see them come with the new Ultium and Ultifi platform. So Ultium, the battery system, Ultifi the connected vehicle system, which is going to allow us to help begin the process of driving those connected vehicle revenues that we talked about that are such a big part of that growth. So I think 2022 is going to be a good year on that trajectory. And hopefully, yet another one and many, many more to come on our growth trajectory.

Perfect. Let's just go back into some of the near-term items here. So first of all thanks for the [indiscernible] update, you said $14 billion, I think you were previously at the high end of that $11.5 billion to $13.5 billion. Let's just -- let's focus just on the volume piece, which you said there's upside. A, I mean, I realize it's very early days, is there any impact from Omicron that you're seeing? And b, maybe you could give us a little more color on what you're seeing on the supply chain side, broadly speaking. Are you -- did you just get more chips? Or is this shortage easing or some of the issues that we've been hearing about have they been easing? So what can you say about the volume trajectory, which sounds like it's positive or a bit better than expected?

Yes, I think that's right, Dan. And let me first just kind of tackle Omicron and I know that there's new concerns about the first case in the U.S. that was discovered just earlier today. I think we haven't built anything in for that. I think it's -- it literally is just another example of some of the things that we've got to face. And honestly, I couldn't be more proud of what the organization has done with all of the volatility thrown at it, not only this year but in 2020 and even 2019. I think the company has really learned how to be nimble and that's what it takes in the new world anyway, even if we're going to compete at a faster pace. For Omicron obviously, our first and primary concern is with the health and safety of our employees. And we're continuing with the protocols that we have put in place that have worked to protect our people. And I'm really proud of what everybody on the front lines and what they've done in the assembly plants to get the vehicles out, despite some of the challenges that they've seen. And I've got confidence in our supply chain. Obviously, the Delta variant and what we saw earlier had some impact in Malaysia. We're certainly not seeing that right now. But as you pointed out, it's in the early stages going forward. So I think we would just set that aside and say it does represent a risk. There's no doubt about that. But I feel comfortable in terms of the way we're running the business and the way we've adjusted so far. And we'll adapt to the business to make sure that we're reaching our goals. As far as sort of steady state volume recovery, we do see it getting better. And I think you see that common across other OEMs and even in some in the consumer electronics space. We're not fully recovered yet, and I don't think we expect to be into 2022. I think the way I would describe it is it's stabilized. If you go back to what we said at the very beginning of this last year, we kind of saw it peaking in the June time frame and starting to get better after that. We actually had a good second quarter, really, really strong. We were probably impacted more than others in the third quarter because of the Malaysia issues, but we've seen that recovery into the fourth quarter. So I think as we look forward, I think we expect to see first quarter be probably similar to fourth quarter and then starting to stabilize and improve throughout the second half of 2022. And that's the way we're thinking about our budgets and our plans going forward. And hopefully, and we're optimistic, that we can get to sort of a full run rate by the end of next year going forward. So we're going to continue to try to do that. That's the short term. And I think in the medium and longer term arena, you've seen comments from us about what we're doing to simplify semiconductors in our vehicles going to 3 chip families or controller families, working in partnership with the semiconductor fabricators and suppliers themselves. I think this will help lessen the pressure and some of the complexity in the vehicles, which will be -- make it easier to manage the overall supply chain constraints and help to make sure that this doesn't become the issue again that it has this year for us. And we're going to continue to design that to bring our vehicles to market faster and more consistently than what we've seen over the last year or so.

Got it. Let's -- maybe if we can talk about some of the puts and takes on '22, aside from volume, first of all, I think just big picture, it sounds like you're reaffirming that 10% North America margin. Maybe you can help unpack some of the moving pieces within that commodities? I think you previously said there was like a rough expectation for up $2 billion with some improvement in the second half. Mix GMF's just want to -- big picture, could you help unpack some of the puts and takes on '22. And any magnitude you can give would be helpful.

Yes, sure, Dan. And like I said, we'll give sort of formal guidance in February, when we normally do it. But we do expect that 2022 is going to be another strong year. I think the consumer remains strong, and we're optimistic that, that will be the case. I think there's been a lot of demand that's been left on the table recently across the board. It will take some time to work through that. But we also don't necessarily see inventories building considerably throughout the year based on that demand curve. So I think we're pretty consistent in our expectations on the consumer side and on the pricing side going forward. And that's helping to offset -- when you combine that with a higher volume, that's helping to offset some of the inflation that we're seeing in the business, whether it's the approximately $2 billion in commodities that we saw, there's some onetime things in the GMF results this year of going in and truing up liability balances, et cetera, to experience these kind of trends that will overcome and lap in 2022. There's a little bit more spending and growth initiatives, including Cruise, as Cruise ramps up towards commercialization. And then lastly, there were some mark-to-market gains that we've seen this year. We don't assume they're going to repeat. They might, and we'll continue to watch that going forward. But as we put all that together, I think we can offset largely those pressures and maintain and get to that 10% North America margin level in spite of some pretty heavy inflation across the business. And that's okay. And that's what we need to continue to strive to do and position the company to do to be successful going forward.

Let's -- if we could talk about pricing, because I think you mentioned some of those things, but not -- you didn't hit on the pricing piece. I think you're on track this year for, call it, like $5 billion to $6 billion of pricing benefit, given the very obvious tight inventory situation that we have [indiscernible]. We have a big pent-up demand or I think that's the consensus view out there given some of the SAR results that we're seeing that are below normalized levels. Is it possible that a lot of this pricing that we have this year could remain intact into 2022, just purely on a release of pent-up demand? And even as you start to have some inventory normalization that the pricing could remain intact, is that feasible?

I think we are certainly expecting a strong consumer environment to continue into 2022 for sure. And as I said, I don't certainly think that we're going to be in a position where we're going to be anywhere near with a normalized inventory, whether you're looking at past or you're looking at go forward expectations on what new management inventory levels are, which we've said are going to be lower than what they've been historically. I don't think we're going to get there by the end of 2022. Even as we get and stabilize chips and get to what, like I said, hopefully, we expect kind of normalized run rate production by the end of 2022, that's not going to be the basis to grow inventory significantly that I think is going to alter that environment. So lots of things can change. We see inflation everywhere. As I know, many of our investors are seeing it. And we need to make sure that we're continuing to offer consumers quality vehicles that they value, and that they want to buy. And so far, the team has done an amazing job with that. And I think customers have backed that up with their dollars. So we've got to continue to watch the consumer. But like I said, our expectations are right now that 2022 should be a pretty strong year commercially.

Great. And then maybe one more on 2022, and this is tying into the transformation that you have, you put out this $35 billion 5-year spend target. How much incremental spend could we see in '22? I mean maybe you can give us a sense how much you've spent of that $35 billion in 2021? And how much incrementally could we see in 2022?

Yes. What I would say, Dan, is it's -- when you look at the sort of precise tracking, I would say we probably spent about 10% of that in 2021. You're going to kind of see that step up, both in kind of capital as well as some of the operating investments I alluded to that in the comments that I made around the additional spend at Cruise as they're getting closer to commercialization and some of the growth investments that we're making across the board. So I think you're going to see that base accelerate, but that's natural when you think about going from where we are today to the more than 30 EVs out in the market by 2025. You're going to see that acceleration happening. So I'm very, very comfortable with where we are on the cash side. I'm comfortable with where we are on the projections of continuing to fund this with internally generated cash flows. And I think you heard us earlier this year say that probably the proudest moment of 2021 has been not just maintaining but accelerating and leaning into this EV transformation in the face of what was pretty significant uncertainty. And I think the company and the team has risen to the occasion. And I think that's what you're going to see. This is an absolute priority for us. And to the extent that we find ways to lean in and accelerate faster, I think we're going to do that.

Great. Let's pivot to the EV side of your transformation. As you start selling -- you're going to start selling Hummer in the next few months. You have LYRIQ, I think, in the first half, EV Silverado, whenever that's going to be, I would assume sometime in the second half of 2022. These are higher price point entries, although Silverado could have some lower opportunity, lower price points. What do we extrapolate from these vehicles to the eventual higher volume, lower price entry that we're expecting in 2023?

I think that's a fair question. I think that's the $100 billion question that's out there, is who's getting to ubiquity across the -- across all demand sets going forward. And I think that's where we have an advantage with Ultium, right? We hang our hat on the fact that it's probably the most versatile battery platform that we have that's out there in terms of our ability to design vehicles around it and for it to serve the functionality that it needs to. So I think what the Hummer and the LYRIQ represent are really, really good sort of flagship entries into electric vehicles. I think they're going to demonstrate the capabilities, the functionality and the quality of electric vehicles that GM can produce with the Ultium platform. And that's going to serve as a scaling benefit for us. We teased out at Investor Day a Chevy $30,000 type opportunity and even mention one coming in the future that's going to be even cheaper than that. And the team is hard at work at making those a reality. So we want to make sure that we bring everybody along on this journey. And certainly, as we've outlined 40% to 50% of our production in electric vehicles by 2030 and 100% by 2035 across all light vehicles. We need to make sure that we've got vehicles across all price points. But when you look at the demand that's out there, and we've had -- I think the number is close to 0.5 million handraisers across the LYRIQ and across the Hummer EV. The demand for these vehicles is really, really strong despite the Hummer EV coming in at a higher price point. But I think that's an indication of the coolness factor of the functionality and the capabilities of the vehicle. And it's not just a few months away, Dan, it's later this month. So we're really excited about that.

Great. As we think about product development, I think at a presentation a year ago, there was some disclosure slide that showed a typical development time was historically, call it, 48 months and now you shortened it to 28 months, just finding ways to create more efficiencies along the way. And I think you said like BrightDrop, the van that you developed was like a record 20 months. So is this a new trend? Are we actually seeing much faster development times in your product? And given the EV market is really starved for affordable product, what can you do to accelerate timing of your more affordable entries? Or is this just a staggered -- you're going to start at a high price point and just go down step down a step, et cetera?

Well, I appreciate Dan you calling out the sort of production cycle time or the development time line. That is I think, an extraordinary achievement and one of the most sort of under-celebrated underappreciated data points that we've got because versatility and speed to market is ultimately, going to win in this space. And I think what you've got is a very programmatic cadence that we're rolling out. We are accelerating where we can across the board. I think we've probably pulled forward about 12 EVs from the original plans that were rolled out just 1.5 years ago. You saw that in the announcement that we made over the summer about accelerating battery plants and making sure that we have the cell capacity to be able to do that. But I think the most important thing is that we stay on the aggressive end of the adoption curve. And I'm on record inside the company is saying, I would rather build a battery plant that sits idle for 2 to 3 years because we overestimated EV adoption than ever be caught in a position where we are full, and we can't sell more EVs going forward. So as we're getting these cell plants online, we're building those capabilities to move to the aggressive end of that adoption curve and continue to position us. And from there, we can continue to rotate the plants, pivot them as part of Gerald's manufacturing transformation as we see demand. So very, very comfortable right now with our cadence, but we're always looking for ways to pull that forward. And I think you're going to see a much higher velocity from us over the next 24 to 48 months.

Maybe you can talk about unpacking the -- you talked about manufacturing and battery plants, how you're attacking the supply chain? So first of all, I think this is probably a good venue. There was an announcement that your team put out a few hours ago on, I believe it was addressing battery materials, cathode materials for Ultium with an agreement with POSCO. So maybe if you have a word or 2 on that agreement and how that fits into the broader vertical integration or supply approach that you're taking on EV?

Yes. This is one of those great areas. I've gotten to ask my sophomore daughter who's at Michigan, a lot of questions about chemistry and electricity that I forgot from my old chemistry and physics days, but really excited about what we're doing here, as we've talked about before. We want to make sure that we are on the leading edge of controlling vertically the supply chain to the best extent that we can. We've talked about lithium production and now with this announcement of this joint venture with POSCO, we're going to bring cathode active material into North America and create that processing. This is about, I think, roughly 1/3 to half the cost of the battery and it represents a very significant function in terms of driving capacity. And that relationship with POSCO, that joint venture is going to allow us to have more control and continue to invest and grow that. So that, that active material or that TAM capacity can keep up with what we need to do on cell production, and we've got that that's something that doesn't have to be spread across industry where we're controlling our own factors of production and making sure that we've got partners that will invest at the velocity that we need them to for our demand going forward. So I think this is the first of many announcements that are -- we're talking about over the coming months and years as we've talked about taking the long-term view along this journey to this EV transformation. So really proud of the team for putting this together and looking forward to seeing what we can do through that joint venture.

Let me ask the supply question a little differently, assuming demand isn't an issue, what's ultimately the largest constraint for you in EV volumes? Is it just the vehicle assembly itself? Is it cell supply, cell materials, something else? What is it that will -- if it's not demand, what will determine the pace of your EV volume, if it's a supply?

Well, I think what we've said from day 1, Dan, is we want to bring everybody along, right? So Ultimately, what we have to do is be in a position to inflect along with, if not lead the consumer through EV adoption. And that's where the sheer variety and magnitude of the vehicles that we're going to produce are going to help that across the board. But the scaling production, I think we've talked about our manufacturing advantages at Investor Day that not only can we do it -- convert a plant cheaper, but we could also do it faster than a greenfield facility with all the site selection and permitting and negotiations and things that need to happen. We've got the walls, we've got the framework. We've got the process lines. We just need to go in and sort of fix the tooling and the systems to be able to manage the heavier vehicles, and we've demonstrated that with Factory ZERO as well as what we're doing currently with Spring Hill, which will ultimately produce the LYRIQ later in 2022. So I think that -- the capabilities are certainly there. I think the resources are there. There are no cash constraints for us in terms of pulling that stuff forward. So like I said, what we need to do is just make sure that in the near term, we're moving ahead of consumer adoption. Even if that move means that we convert assets a little bit ahead of where they need to be for that consumer demand so that we can flex very, very quickly. But I think you see us lining up all of those things that have been listed as constraints and obstacles in the path of more EV production and concentrating on EV. And ultimately, I think we've got the right playbook to be able to execute that.

I think you just alluded to it, but just on the capital side, it sounds like you're basically spending whatever it is that you need to spend. If you spend more, does that help unlock additional potential? Or are you just spending at the fact that you can spend and it's not really an issue of capital availability or cash availability?

Yes. Well, no, look, I think the team has done an extraordinary job of shoring up the balance sheet to be able to make sure that even if we need to weather a storm to keep the level of pace in investment up. We're going to do that. We haven't needed to do that. It's been a really, really strong year for cash generation as evidenced by the capital that we're spending and the free cash flow. I expect that next year will be a very strong year as well based on how it's coming together. And I think we're always looking for ways to lean in. We're not going to leave people behind. We're not going to leave our own employees behind or our plants behind. We're going to continue to make sure that we're producing high-quality vehicles that ultimately transition from ICE to EV. We just need to be, like I said, on the aggressive end of that EV spectrum and lead into adoption. So where we can, we're doing that, where there's technology and invention that needs to happen with the battery chemistry, where we're giving all the resources that we can and making sure that we've got everything lined up. But what I would say is internally, all of the business leaders know that they can pick up the phone and ask me for the resources they need and provide a compelling case, we can do that. We need to maintain discipline around it. So we're asking, how is this tied to revenue growth, how is this tied to EV readiness, and we're running through that disciplined process, and that's how we're allocating capital. But what we want to be as a finance team is we don't want to be anybody that's out there saying, no, because we've got the right hand, and we just need to make sure that we play it appropriately.

So message is, the checkbook is open and ready to go to work?

There's money in the account, the checkbook is open, but you have to at least put on the memo line, what you're going to use it for.

Great. I know we're running close on time here. So I want to ask you just a question about your outside endeavors. I have a question here that I got on cash flows, and then we'll just close out a big picture on the stock. Outside endeavors, outside of Cruise, you've highlighted a variety of other opportunities just outside of core vehicle sales, software, defense, BrightDrop. Help us understand in terms of the resource outlay and that, by the way, is excluding we've heard about eVTOL and other opportunities that you didn't even talk about at the Investor Day, but we know you're doing other stuff that wasn't discussed there. So help us understand how wide the resource outlay is on these other endeavors at GM?

Well, I think we've been leaning into that over the last couple of years, Dan, as you've seen. And the team that Alan Wexler leads on the innovation front is really doing extraordinary things. And as he talked about at Investor Day, what we do is we look for tangential TAMs that are associated with us. So whether its batteries or its mobility. There are ways for us to go in and try to drive revenue and try to drive growth in spaces that are enabled by either the technology of the vehicles or by the electrification. I think BrightDrop is a great example of that where GM was underrepresented or even nonexistent in that space. And what we've seen in terms of the creation of that vehicle, the creation of the business model and the network benefits that we could provide with that, e-pallette system, et cetera. You've seen that with FedEx and with Merchant's Fleet, who just recently increased their orders, I think, by almost 50% of their original order, has done really extraordinary things for us. So that group is constantly on the lookout in terms of incubating and ultimately driving growth in those businesses. And as we see OnStar insurance, we see BrightDrop, there are lots of other things out there that they're working on. What we need to do is make sure that it doesn't become a distraction. But it's not. The team is incredibly efficient with the resources that they are allocated. I would say that it's still relatively small compared to the size and the scale of GM. But as you've seen with BrightDrop in some of the statements that we've made about insurance, there are high-growth opportunities in there that will continue to grow and develop over the next decade. And we're very excited about that part of the business as well.

A question of clarification, and then we'll wrap here on the cash side. So you're raising your full year guidance, and you're getting some puts and takes on '22. Maybe you can say how this -- what's implied here on the cash flow front, given there are some nuances on the working capital side and how that working capital rebuild may trend in '22?

Yes. I think what you've seen in 2021, Dan, is that we -- the typical sort of negative working capital position that unwinds with lower inventories manifested itself. And I think we overcame that a lot with some of the commercial initiatives, vehicle mix, et cetera, some of the pricing. And we're funding everything that we need to. I think we'll see some stability/potentially improvement in that with incentives down the way they are. It's really the quality of current sales is greater -- or the quality of the current revenue and the cash generation is greater than what it's been in the past, which is not going to fund that liability going forward. So more of the cash that we're taking in, we're keeping and not kind of reserving that in the liability to get back later. So I expect that 2022 is going to be a strong cash year, and we'll provide more detail on that as we get into formal guidance.

Great. Let's wrap here just with a comment on the stock. This is the type of stuff that if you turned on CNBC and this is the question that comes up is that, obviously, your stock has done well, but we know there's a valuation disconnect between where you are versus where some of the new entrants are in the market. This is not a surprise [indiscernible]. What do you think it is that the market is missing on your ability to transition? Because I think you've laid out the pieces here pretty well about what you're planning and back in October, you gave us a very ambitious set of targets and plans. What do you think it is that the market is missing? And what really helps to unlock that opportunity for investors?

Yes. That's a fair question, Dan, and one that we spend a lot of time thinking about kind of every day in terms of how to move the needle. What I would tell you is that we're absolutely committed to putting this story together and creating the General Motors for the next 100 years. And I think we have the team to do it. I think we get pitched a lot of sort of short-term financial engineering things to do, et cetera. But the #1 thing we need to be focused on is the strategy. So I understand market skepticism from time to time. Obviously, we laid out some goals that I think we're pretty ambitious when we revealed that at Investor Day. We're absolutely committed to achieving them. We have a road map to do that. And I think what we need to do is earn investors' trust over time that we're executing, which is why going back to the first part of our discussion around creating those KSIs and those mile markers, if you will, that show progress to achieving those goals, I think we're going to build that. And I like to think that what we're doing quarter after quarter and goal after goal and announcement after announcement, is really winding a spring tighter that eventually, we're going to create conviction around that story. And that's where you start to see some real acceleration. We have some clear advantages over start-ups. Gerald refers to the 1.4 million years of manufacturing experience on his team. That's not something to slough off. The capacity that we have, the advantage we have to pivot and to convert plants going forward, is not something to shrug off either. And I think what -- there are some easy assumptions to be made about start-ups based on some of the past. And I don't want to take anything away from Tesla, I think they've done extraordinary things. Not every start-up is Tesla. And at the end of the day, it's different when we're talking about 4% to 5% of the market versus talking about 40% to 50% and ultimately, higher going to 100% of the market. And that's where I continue to believe that scale matters in this business. And when you look at the quality and the expertise and the capabilities that we have as well as the asset base, I feel like we're really well positioned to do that. And we're going to continue to win. I tell people internally, there's nothing greater about my job than getting market validation on the skills and the capabilities of the people of GM. They are an incredibly talented, diverse set of people, and they have an immense amount of capabilities. And I really, really look forward to that team getting credit for all the great work that they're doing going forward, and we see that reflected in the stock price. And I'm confident that we're going to get there.

Great. Thank you, Paul and team. I know that was a lot to pack in and we went over. But thank you, very insightful, very resourceful. And we look forward to hearing more from you.

Well, thanks for the opportunity, Dan. And I appreciate everybody paying attention today.

Great. Thank you. Open Exchange, you can close out the session.