T-Mobile US, Inc. (TMUS) Earnings Call Transcript & Summary

Good afternoon, everybody. Welcome to the T-Mobile fireside chat presentation at the Goldman Sachs Communacopia and Technology conference. I have the privilege of introducing Mike Sievert, President and CEO; and Srini Gopalan, who is the COO. My name is Mike Ng. I cover telco media cable here at Goldman Sachs. We have about 35 minutes for today's presentation. And before we start, I wanted to highlight the safe harbor slide behind us here, which basically states that some of the statements made today will be forward-looking and will be subject to the risks and uncertainties in the company's SEC filings. So first, thank you so much, Mike. Thank you, Srini, for being here today. It's an absolute privilege to have you on stage here with us.

One of the best conferences of the year. We were just talking off stage. This is one of the only ones that I come to every year without fail. And thanks for having us back.

And we appreciate your support of the conference. It's really wonderful. Mike, to start things off, I was wondering if you could just talk a little bit about the strategic moves that you've made in the last couple of years, U.S. Cellular, Metronet, Lumos you guys are on your way to a fiber footprint totaling 12 million to 15 million homes. Could you just tie that all together for us and talk about how that fits into your overall strategy?

Absolutely. So if you think about all the things that you mentioned, there's a wide variety of things that we're focused on. The common theme here is growth. T-Mobile is the growth leader in this industry and intends to remain that way. And so the priorities you see us pursuing looking backward and looking forward are all about 3 big priorities: near-term growth, medium-term growth, long-term growth, accretive, profitable industry-leading growth. And so look, if you think about just parsing that, the near-term picture is just looking fantastic for us. As you know, we just finished Q2, just all-time record quarter on almost every metric, postpaid net additions, postpaid phone net additions for Q2. Service revenue growth kind of 3x our benchmark competitors or more. Competitors who are getting credit for growing, some that you've met with this week, getting some credit for growing 3x that rate from T-Mobile. And then, of course, translating all that to cash flow of 26% of service revenue dollars by far and away, the industry leading number by a long shot. We're the only company that has been able to lead in 2 separate categories like wireless and broadband. 13 quarters in a row, the leader in postpaid or postpaid phone net additions and broadband net additions. And so it really shows you that the strategy of this company is firing on all cylinders in the near term. And so the things that you see us doing are making thoughtful investments like we did years ago that have driven the present success to make sure that, that continues. And if you think about the core business, that's where our focus is. I mean we are pursuing big underpenetrated segments where T-Mobile has a permission to profitably grow and the wherewithal and know-how and embedded investments that allow us to do that. You think about network seekers in the top 100 markets. I mean, far from defending our castle in the top 100 markets, top 50 markets even double-click into it. We're the market leader and yet we're outgrowing everyone. You think about that for a minute. Why? Because tens of millions of people chose their network years ago in the 4G era thinking it was the best and now there's a new best network, and they're making that switch, huge underpenetrated opportunity for us, network seekers in the top 100 markets. Smaller markets in rural areas, that 40% of the country that's not the top 100 cities. We're growing in many of those places at twice our market share up 20% or so. And so twice that rate in many of the smaller markets in rural areas is our win share and on average, just a little less than double. And so that's a huge opportunity. You see us making investments in our network, augmenting it, rolling out capabilities and, of course, U.S. Cellular, which further augments both the network picture, the distribution picture, the customer base in those areas. Business, Enterprise and government, this is a huge opportunity for us. Q2, all-time records. We had the quadfecta, we led the industry in Q2 relative to our competitors in postpaid net additions, postpaid phone net additions, broadband net additions and churn. So really great present success, but we're really underpenetrated. And so huge opportunities for us. And then, of course, all the adjacencies you've seen us investing in that we're investing in because we've got strength and we see an ability to take our know-how and capabilities and outperform financially versus a typical financial investor in areas such as fiber. So it's all about planting the seeds for the future while realizing present success with all-time record results. And a lot of those circumstances that drove just that blockbuster Q2, we've seen just roll right into Q3 as well. So we're seeing a great performance in the marketplace, as we indicated in our earnings release as well as some recent update to guidance that show that Q3 is just on track to be another, we can say now with 2 months down, another great quarter for T-Mobile.

It's a fantastic overview. Srini, turning to you, you have a wealth of industry experience and knowledge and global experience at that, could you just talk a little bit about how you view T-Mobile in the context of your unique global perspective?

Sure. Thanks, Mike. Look, this is going to sound strange in the context of all the performance we've delivered to date, right? Just the whole Un-carrier story and everything that's happened to date. But I'm convinced that the best lies ahead, right? And through all of the markets I've been through, and the reason for that conviction is when I look back at the storied history of the Un-carrier, right, we competed on the back of value, we competed on the back of an incredible culture. We competed on the back of real hunger to win. But we also competed with kind of 2 hands tied behind our back, right? We were #4 or 4 networks for the vast majority of this. And to Mike's earlier point, the size of the opportunity with network seekers is mind blowing. We think there's at least 70 million customers who choose Verizon or AT&T for being the best network and paid a premium for it. That entire opportunity is open to us. And the thing that gets me most excited as we look forward to the future is in all of the telco markets have been in, I've never really seen a unicorn like we are, right? Because this position of best network and best value, both at the same point in time, right? For me, is kind of the core of the Un-carrier story, being able to smash through false trade-offs that you present customers with. So really excited about where we are and the fact that we've gotten here and still have so much opportunity in front of us just with the network seeker piece. The other part of the story for me is for most of our story's history, our IT and digital capabilities haven't been best-in-class. Now you look at that today, 75 million downloads of T-Life, right? More than 2/3 of our upgrades done with T-Life. What does that whole area fascinate me and believe -- where does my belief that there's a lot of growth there come from? If you look at what we do to customers in our industry today, right, in many ways, the processes and the technology are 20 years old, right? And what we're able to do with digital and AI to take away those pain points to make the whole process of, let's say, switching easier, right? And there's a lot more people who'd want to switch to T-Mobile. We just need to make it easy for them to do that. But what this step does and what the digital journey does for us is best value, best network, best experience. And that is the true unicorn. So as I look forward, that's the stuff that really excites me and why...

Srini, you reminded me that this IT thing, this digital thing. I've been doing this for 35 years, and I can tell you that I have never been in a position like I am right now, for the first time ever, where you can kind of look at yourself in the mirror and say, "I got 99 problems, but IT ain't one of them." I mean like that like how many people -- how many CEOs kind of have the privilege of coming to work saying, "You know what, I think we might be the global leaders here." And we have quietly built this capability to enable a dramatic digital transformation around data, AI, digital over the last few years. So we're not so quietly. We rolled it out pretty loudly at our Investor Day last year. But we're making enormous progress. I think for Srini and I to be sitting here with all of this present success, which is just outsized all-time records at T-Mobile and say, our best days are actually the ones that are ahead, that's probably the principal reason.

And there's still a network perception gap because consumers haven't fully recognized all the network investments and improvements you guys have made and digital should take a lot of friction out of this.

It's not just consumers, right? It's also large businesses. It's government, right? That phenomenon is there everywhere.

Yes. Mike, we get a lot of questions around succession planning. You've been in the industry for 35 years. You've overseen the company for more than the last 5, including the very successful integration of Sprint, which has led to and supported a lot of the industry market share gains. When you think about leadership and the next leg of growth at T-Mobile. What are some of the things that are top of mind for you?

Yes. I mean you're getting that succession planning and all that, that's such a flight way of putting it. Yes, there have been lots of discussion. And I mean, thanks for asking me about it. I take it as a compliment that our company is so transparent about these things that you feel comfortable talking about it, and I feel comfortable talking about and I think that's a less than other companies should take note of. We have been, I think, very transparent all year that Srini, for example, came here as part of our succession planning process. And I'm going to come back to that. But I think also, I've been -- my approach as CEO all along and my predecessors approach has been to showcase this bench the entire time. Have you ever noticed how every 1 of our earnings -- we bring the whole management team, conferences like this. It's not just the 2 of us. We have Mike Katz, our President here with us as well. We bring the team who lead this company because I never want to investors to have any worry that the secret sauce of this Un-carrier outperformance is at risk and it's held by this team. We finish each other's sentences, we're unconfused about what's important, and yes, we challenge each other all the time. And we do a lot of that right in front of our owners. So they can see how we think and operate. And that way, for me, when I brought Srini in and announced he was joining us at the beginning of this year, but that was a combination of a kind of a years long effort. We've been friends and coworkers for many years. I made it very clear that, that was as a part of a succession planning process. And I think that's a lesson other companies should take. I benefited -- I followed an iconic leader years ago, 6 years ago when the company announced I would be CEO. I was stepping into the shoes of somebody who is very famous and effective and Wall Street looked at it and said, "Yes, that makes sense. Good on you guys." And sort of we all moved on. And that is what great succession planning looks like. I think John showed a great path for that, and I'm trying to do the same thing. Now we're not here to make any predictions worry about exactly how and when it will all unfold or where we'll land. But that's been my philosophy, the whole time. And Srini and I kind of run this company together. He's got 90% of the employees of this company. And you can see the results that we're delivering over the last couple of quarters, if there's any question about whether or not this guy gets the Un-carrier.

Great. Thank you for that. Let's talk about the consumer wireless business. I mean, it's been a tremendous amount of focus for the market. I think a lot of people have observed a higher level of competitive intensity, at least at the beginning of the year, reportedly. We've seen strong gross adds but also strong or higher churn. Could you just unpack for us what's actually happening in consumer wireless right now?

Maybe we'll both jump in. I'll start. I mean look, we're really comfortable with the nature of competition right now. And that may be different from what you're hearing from others. I can't speak for them. It may feel hotter in the kitchen for them. We're really comfortable. Our Q2 results were during a time of competition that's just like what we're seeing now. You saw our outsized performance then. Not a lot has changed since then. And one of the things that I want to underscore is that the value we're creating from customer acquisition is right in line with our historical norms. And that might surprise some people because they're like, "Man, you're paying a lot for those gross adds." I'm like right, but the gross adds are more valuable as well. And you see that Q2, our ARPUs rose by 5%. I mean, that's a lot. And so the overall customer lifetime values are in line with historical norms, while we're delivering outsized growth and simultaneously delivering cash production from service revenue dollars that lead the industry by a long mile so we're really comfortable with it. And there's a reason for that. I mean, customers kind of find their way to the truth. And as Srini talked about a minute ago, we've got the best value. I mean customers can switch to T-Mobile and save 20% and get treated by a company that doesn't seem to resent them. And when you factor in all the benefits and privileges of being a member at T-Mobile, and increasingly, they're waking up for the fact that we've got the best network was never true before. It has been true for 2 or 3 years. And finally, now this year, you see at scale people starting to kind of figure that out. And so that just gives lots of tailwinds.

The point Mike was making, right? We can get lost on the froth. What promotion is someone running? What's the latest iPhone offer, et cetera, et cetera. The reality is there's a broader underlying secular trend, which is us winning more share. And when you have the best network, best experience and best value, what is the fair share? Right? And all you're seeing is that secular trend play out, right? Now on top of that, there's froth, we manage that froth with kind of real rigor, making sure that our CLVs grow and the rest of it. I mean testament to this fact is when we did the U.S. Cellular announcement, right, we actually are underlying nets, we took them up because we kind of integrated U.S. Cellular. If you just look at their Q2, 112 basis points churn, negative 40,000 nets. Despite that, right? We stayed without original guide, which means the underlying business is actually performing even stronger. And while we manage kind of the promotion cycle and everything around it very rigorously, it doesn't escape us that there's an underlying secular trend of move -- of people being tired of the trade-offs that they have to face between network and value and moving to a place where that trade-off doesn't exist.

One thing that's going well is that switching is a little more vibrant in the market this year. If you look at Q2, churn was up across the market a little bit. Not the kind of thing you want to see up a lot. But when it's up on the margin, our sequential and year-over-year churn comps were the best in the industry. So our relative performance versus our norms was the best there was in Q2 but they were all a little bit elevated versus year ago levels. What's that mean? What that means is more people are switching and when you're winning a disproportionate share of the switching and doing it economically, as we just explained, we're doing, well, that's great for us. And so you see that flowing through to our financials and the improvements to the guide that we've been making and we always are a little thoughtful about guide and maybe it trails what we're seeing. So you can hope that things sort of continue to unfold in a really good manner, and hopefully you're getting that sense from us today. We're very comfortable with where things are.

Right. If you are net share gainer, you should be happy about jump balls.

Yes, more jump balls is a good thing.

Yes. This week, Apple announced its new iPhone. So maybe we can talk a little bit about that. What's been driving some of this higher switcher pool, higher upgrade activity? Is some of it related to tariffs and the pull forward of smartphone upgrade demand into the first half of the year. What are the implications of the new iPhone launch? And what are your observations around the promotion supporting the iPhone 17?

Personally, I've been waiting for this week with bated breath. And the reason for that is that I have a cracked screen, so I just can't wait for, I don't want to buy the old one. So -- but Srini, you were actually there yesterday. Maybe you can talk about your observations.

Look, I think big picture first, right? Whether this is a super cycle or not, there's lots of speculation to that. The reality is we like it both ways. If there is a super cycle, great, there's more churn, there's more movement, and that's good for us. If there isn't that flows to EBITDA, that gives us more cash to invest in the short term. So we like it both ways, and that's 1 of the joys of being the Unicorn. Specifically on this iPhone, what we love about it is so much of the capabilities of that iPhone depend on you having a nationwide 5G SA network, right? That allows us to do multiple carrier aggregation, which lands up, meaning that the iPhone on T-Mobile is up to 35% faster quicker than it is anywhere else, right? And that's because of the thoughtful approach we've taken to rolling out 5G SA because we have that back in 2020. There's other people completing their rollout of 5G SA end of this year, right? So that network lead the better the device, the more the network lead plays out. And as always, we're committed to our value position, which is why when you look at the promotions, we were competitive there. We'll make sure that value stays with us.

I think we're going to see a decent amount of jump balls with this cycle. People have had their 5G phones for a while now. You saw those penetration numbers, not just from us, but for our competitors as well, 3 years ago. So it seems like time on that front. And I think people are kind of excited about these camera capabilities. The physical form factors are a little different. And this is kind of sound crazy, but it kind of matters that if you're going to spend all that money on a phone, if you whip it out and throw it on the table like your friends can notice, it looks a little different than last year. Looks very -- so all these things kind of add up, whether it's the capabilities, the network connectivity and power, the processing power, the unbelievable improvements in both durability and camera capabilities and many other innovations. Not to mention the air, which blew everybody's mind. So we'll see what -- is it a super cycle. It doesn't matter to us like we don't no. We're not good at predicting that. But we do think that there'll be a lot of jump balls this fall, and we think we are -- it's happening at a time when we are firing on all cylinders.

Cosmic orange that's the one you want...

Yes, the cosmic orange. I like that actually.

Srini, I was wondering if I could ask about the U.S. Cellular acquisition. What should investors be mindful of as you think about the integration of that and how that compares to Sprint?

First up, the U.S. Cellular acquisition is a lot simpler than Sprint. You don't have the CDMA device issue and the rest of it. For us, it's a really exciting, huge opportunity because you come to this piece of best network, best value, right? Now we're getting 47 megahertz of spectrum for 37 million POP. And this is our chance and I was at Oklahoma City with our team there. They're unbelievably excited because they can go out and claim best network in another part of America, right? When you think about our SMRA markets, U.S. Cellular plays directly into that, right? So we're really, really excited by taking the story out further. And that's why you saw our -- we moved up from $1 billion to $1.2 billion, and 3 to 4 years became 2 years, right? And a lot of that is because of everything we learned during Sprint. Things like the AMC, how we integrate networks, the MOCN and the Reverse MOCN as well as the streaming billing migration, which is unique. I've never seen it in another telco which allows us to integrate assets like this really quickly and get the biggest synergies quicker.

Right. Great. Mike, the business market has been a key focus of yours over the last several years. To your point, you still remain underpenetrated. Can you talk a little bit about the opportunity there? And also, maybe make some remarks about the MVNO that you have with the cable providers and why that makes sense for you?

Absolutely. I was going to resist the urge to repeat my comments about the all-time record performance in Q2, but I won't. So the business -- and the reason is I want people to understand the business is just firing on all cylinders. We are realizing industry-leading and record for ourselves, success on things like net additions, postpaid net additions, phone net additions, churn, even broadband net additions. It's really going well. The value creation, the CLVs are right where we want them. And at the same time, and I talked about this very briefly, I think, in our earnings report. One of the dynamics is that it's -- the growth and success is a little bit of barbell shaped. And so you see our best success has come historically from the very small businesses where the go-to-market kind of emulates consumer. They're largely served through our consumer like channels, retail and others and enterprise and government, where it's a more finite market, meaning literally, there's a few thousand people you have to convince to compete effectively in that market and we are competing highly effectively in enterprise and government. In between is this vastness of sort of SMB where we're doing fine, but there's lots of upside. And so it just felt super complementary to us because that's where their strength is, that's where their go-to-market strength, their brand strength, their business strength is in kind of SMB. So it allows us to have what we hope will ultimately be highly effective go-to-market approaches for all of the major segments.

Great. Srini on broadband, the company has a target for 12 million fixed wireless access subscribers by 2028, 12 million to 15 million fiber homes passed by the end of the decade. How does broadband fit into the broader strategy? The company has been emphasizing convergence a little bit less than some of its peers. So I would just love your thoughts on all that.

So let me start with convergence, right? I just like the word because it's just a really fancy term for bundling, right? Ultimately, what we call convergence is a very specific bundle of wireless being attached to wireline, right? Now our thesis on convergence is different from some of our competitors, and there are good reasons for that, right? But before I get to the thesis, you've just got to look at the numbers first, right? For the last 5 years, 85% of Americas have the option of bundling wireless into their wireline. And as Mike said, and yet our growth continues, not just continuous but accelerates I mean we had our best Q2 ever, overall postpaid and postpaid phone, right? That just tells you that there's always going to be a segment that wants to do that bundle, but that's of the margins. And our position of the unicorn more than outweighs all of those effects, right? But just that -- it's in the run rate and in the run rate we're accelerating. When you come to the hypothesis on a lot of investors asked me this question, which is -- why is -- will the U.S. become like Europe right? And before we get into that, I mean, a lot of the European problems have to do with excess capacity in mobility rather than convergence or bundling of wireless with wireline, right? I think there's 3 big differences. Number one, it's a myth to believe that bundling wireless along with wireline is the largest purchase form in Europe in big markets like Germany or the U.K. right? The levels of bundling wireless along with wireline are not fundamentally different from the U.S. Second, I'd argue the U.S. is the most bundled wireless market in the world. Because of family plans. I mean the typical account has 3 postpaid phones attached to it.

Yes. And device plans.

And device plans. And then so you have 2 bundles, an EIP bundle and a family bundle. And thirdly, 1 of the big drivers to this whole bundling of wireless with wireline in Europe was that wireline churn was 70 bps. Wireless churn was 110 bps. What you were trying to do is bring them together, right? Now the reverse is true of the U.S. You're looking at even with fiber 130 bps of churn and wireless even the recent quarters, 90 bps so you look at all of that and go, this form of bundling is going to exist at the margin, but there are other forms of bundling, which are going to be much bigger scale, right? And I also understand why some -- if you're overbuilding existing copper with fiber, and you need to kind of justify that. I've been there in Germany, right? It's really hard to justify it purely based on the incremental ARPU of that move. So you've got to talk up a bunch of other stuff, right, to make economic sense of that move.

So why do we point out all these things? I mean it's not to explain that we're not ambitious in that space. I mean, far from it, we'll come back to that. I mean we're the growth leaders in this industry, broadband. We're very ambitious in this space. it's the why. It's to make sure no one's confused about why we're doing it. We don't believe that our leadership in broadband, which we expect to persist for quite some time is for any reason other than that it's a great business, it is not to defend our wireless business. We don't believe it's necessary to defend our wireless business for all the reasons that Srini just very well articulated. This is a business we just think we can deliver a fantastic product and delight customers, which is our mission, and derive a return that outpaces purely disinterested financial investors by virtue of our capabilities, know-how and embedded investments. And you see that in our results. We're the only company that's ever led and have been leading for 13 quarters in growth in both broadband overall and wireless overall. And I think 1 of the reasons you see that is that fixed wireless, which is our largest segment, although we're very interested in fiber and you see us making some cool moves in fiber. Fixed wireless is here to stay. And it is nowhere near its terminal penetration. We have lots of room to run. And 1 of the things that people need to keep in mind is that the technology is not standing still. So if you want to drag right and predict the terminal penetration of fixed wireless, don't drag right today's wireless capabilities, make sure you factor what's coming with 5G advanced and 6G and beyond.

And 1 of the -- I mean 1 of the things we love about the broadband market is this team loves going after markets where you have a large incumbent with an inflated back book and an inferior product, right? And taking that on with both FWA and fiber, gives us lots of runway. It kind of plays into what we're very, very good at doing.

Great. When you think about the 12 million to 15 million fiber homes pass goal, like what's the right terminal penetration? How are you thinking about the balancing of subscribers and revenues.

So if you look at the way we thought about fiber, right, there's a set of strengths that we bring, those are our brand, distribution, right, just our capability to think about how we price the stuff rather than getting into creating win-wins for customers and us, right, and great distribution with a great brand. Those will all naturally drive us, we believe, to higher penetration. However, as ever, we're prudent about the way we think about our IRRs and how none of our IRR calcs, are based on anything other than a typical terminal penetration across the market, right? And we really like those JVs because while we've been bringing these strengths, we also have humility. We understand we're not the best guys to be digging fiber to be doing the truck roll, right? We have partners like Metronet and KKR and EQT, who know this business really well. And we believe that brings together the best of both worlds.

Yes. I'd love to expand on Mike's comments earlier around making sure we acknowledge that there's going to be technological innovation and fixed wireless access as we think about capacity. Could you just talk a little bit more about the supply-demand dynamics within fixed wireless? Is this something that you'll have to invest directly in? What do the returns look like for that?

Jump in.

So we've historically talked about this as -- so firstly, if you think of the fixed wireless product, right, it is -- it blows my mind what we've achieved. We've gone from 3-point -- just in 2 years. We've gone from 3.7 million customers to 7.3 million customers. Each customer now uses 25% more data, a staggering 561 gigs. Despite all that, our average download speed has gone up by 50%. And when you talk about an ultra-capacity network and a network that's kind of got a lot of room to go, that just dimensions it. Our center of gravity has been the fallow capacity model, which is we first make sure we prudently project our growth in mobile at a x -- kind of 165 meters by 165 meters level and look at what capacity is left over and use that to drive fixed wireless access. And that's the way we still think about this from a return on capital. That's the most efficient way. Are we exploring other models? Yes. And there may be other people who, given their spectrum holdings need to go to less efficient models earlier or we'll see how that plays out. Right now, we think there's a lot of room to run on our fallow capacity model, and that's what we're pushing hard on. And if you look at our wait list now, we've got over 1 million customers on the waitlist which tells you the power of the product. I mean we have NPS, which is like 30 points higher than cable.

Yes. And Srini, just going on to capital allocation. You guys obviously have the M&A deals, you're investing in the network, you're investing in fiber, you got buybacks and dividends. How are you balancing accelerating fiber passings versus everything else?

We -- this is 1 of the things that we really debate, work through. We're conscious that we're kind of deploying your money and we take great pride, but also great caution and due diligence before we do that. Our foundational principle is we start with our leverage versus EBITDA. We think 2.5% is the right number. It's been at that number. And given the environment today, we still think it's the right number. We then have the operating free cash flow. And our first priority is to look at the attractive business opportunities, right? And those could be spectrum. We look at that very rigorously. Those could be fiber investments. And then shareholder remuneration for us is the consequence of having made those trade-offs. Once we've looked at everything that we think is really, truly accretive to the business, right? And that's the same approach we followed for a long time. That's what we'll continue doing.

Great. Mike, maybe in the last couple of minutes that we have here, I was wondering if you could just tie it all together for us and talk a little bit about your near-term to midterm strategic priorities, things that investors should take away from this conversation today?

Well, we can pick right up on this capital allocation because we're at this moment, and it's just we've worked so hard to get here to where you've got a business that's present success is firing on all cylinders. The cash production from it is enormous. We've outlooked what that looks like over the next several years. It's tremendously exciting. And that just gives us fantastic optionality. And the first piece is to remember that the core of the business that we are running is extremely successful and highly profitable and just filled with opportunities. We talked about them at the beginning of this session. There's just so many places where we have room to run with a strategy that's highly proven and very profitable. And so as you think about our investments, as Srini is saying, we first chase all of those because our core business is a fantastic business, and we're nowhere near the end of the runway for all the great accretive growth opportunities. Second, it's all these adjacencies. We're very excited about fiber. We've shown our hand that we prefer the growing part of fiber. We prefer pure play. We have a simple business model. We want to be a disruptor, an innovator, a fast-moving company and there is more opportunity there. So we want to be thoughtful about that. And then other adjacencies and finally, shareholder return. And at this leverage of 2.5%, remember, that's on a rapidly rising EBITDA. And so it's 2.5% of a rapid -- 2.5x rather, of a rapidly rising EBITDA, which means that even while holding leverage flat, the nominal amount of dollars available to us are rising rapidly because that's an envelope that's growing, but so our cash flows. And that's a very good place to be. So I bring it back to where Srini started it in our session, which is as we sit here today and look at the next several years, despite the historic success, which is off the charts, the 2 of us have never been more excited about what's ahead.

Mike, Srini, it's just been such a pleasure and privilege to have you on stage here with us. Thank you so much.

Thank you. Cheers.