Xerox Holdings Corporation (XRX) Earnings Call Transcript & Summary

Good morning, guys. So my name is Erik Woodring. I lead the U.S. IT hardware team here at Morgan Stanley. I'm pleased to welcome Chuck Butler, CFO of Xerox to the stage. But before we start, I just have to read this safe harbor agreement. For important disclosures, please see the Morgan Stanley Research disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative. Do you guys mind shutting the doors back there? I apologize. Thank you. Sorry. So I'm delighted to be joined by Chuck Butler today, CFO of Xerox. He was previously CFO at Lexmark. And once the team has obviously joined, became CFO of the combined entity in December of last year. So thank you for joining us today, Chuck.

Absolutely. Thank you.

Cool. So I want to talk about here, I think maybe just to start, I'd love to get maybe your views on what you do at Lexmark, what brought you into -- obviously, we know what brought you into Xerox, but initial kind of impressions of the combined company, opportunities to lean into strengths, opportunities to improve things. Just start very high level, and we'll run from there.

Yes, that sounds great. And thanks for having me again. Yes, when I think about the combination of the 2 companies, I've been at Lexmark for 21 years. So I'm familiar with the space, been involved in the space and I started here pretty early in my career. And Xerox was always the name that carried a large weight in that space coming up, right? I grew up in the age where you would hear people say, let's go make a Xerox. It was synonymous with the word copy. So to be able to be a part of that was exciting to me. And once -- and probably back around 2020, I became CFO of Lexmark, and we started talking to Xerox about what a possible combination would look like. And it finally came to fruition there at the end of last year, which, to me, I use the analogy, the best time to plant a tree is 20 years ago, the second best time is today. I kind of think the same thing about the acquisition. This is an acquisition that makes sense. How do we lean into each other's strengths? What Lexmark brings to the table and what Xerox gets to purchase when they purchased Lexmark is they get their own IP, but they get their own technologies as it relates to the A4 technology. So now we own our A4 technology now. We own in-house manufacturing now. We own a GBS in-house capability, GBS is Global Business Services as we're largely Xerox was outsourced in the past. And those bring significant cost synergies and savings. The other attractive thing is we have enough commonalities where there's significant cost savings, but not so much where you worry about any revenue dissynergies because we don't overlap in every single space. Lexmark was largely a large enterprise go-to-market and Xerox would play a little more on the A3 side of things and would be able to attack that space a little bit higher. Lexmark was -- has a presence in Asia and Xerox didn't have a presence in Asia, but Xerox is a really good name in Asia. So now we open ourselves to a market that's really big, and we're under-indexed which allows us to grow here.

So maybe just to start, and that's a very helpful starting point. I'll go back to like the point of change, which is there's been a -- not change in strategy necessarily, but now there's Lexmark, there's Xerox, there's a digital services opportunity. What are maybe the most important changes under the hood going on at Xerox right now that kind of better position the company, the combined entity of all these for the future?

Yes, that's a good question. First, I would say the strategy hasn't changed, right? Xerox underwent a reinvention strategy a couple of years ago, and we continue to execute that strategy today. And on that was the combination of the 2 acquisitions, ITsavvy and Lexmark. What does that do for us? That ITsavvy brings us a more end-to-end product proposition that we can take to our customers. And we can now -- it's not just print, we can fulfill them all the way from -- if they want hardware, if they want software, if they want a service. We have all those capabilities that can go in and really help them manage their IT budget and what they want to spend their money on going forward. And it gives us a bigger wallet share inside of these customer bases. And we're really focused on executing that along with -- the goals for Xerox are pretty straightforward. We want to stabilize the top line. We want to expand margin, and we need to delever the company. And the combination of these companies allow us to do those.

Perfect. I asked on the earnings call, and I want to kind of circle back to this, which is there is also a lot going on, and we're kind of talking about that. As CFO and kind of partnering with Louis and partnering with Steve, like how do you prioritize these moving pieces to make sure that we're kind of being successful on all fronts and not taking our eyes off the ball on many other fronts.

And I appreciate you saying that because I'm the one that says, don't take our eyes off the ball. You get people that are broader range and think bigger and want to grow, want to expand, let's buy more, let's do more. And I want to refocus people on let's think about the goals of the company. It's to stabilize the top line. It's to expand margin and to delever the company. Sometimes you have to clear out the clutter for the broader employee base to make sure you don't lose focus. And we have those conversations pretty often.

You have a lot of great one liners. I love these. So let's start on the Print business and obviously, close to you because obviously, you come over from Lexmark. I'd love just the general kind of viewpoint of the world from a demand standpoint. But also like when we talk about stabilizing top line, and we'll move into the ITsavvy and all of what that can do. But what is that -- what is stabilizing -- what does stabilizing the Print business really mean? Is there a path to growth? Just help us kind of unpack all of those together into one.

Yes, I appreciate that. When you say -- when we say, when you hear the print is shrinking, we can't shy away from that, it is. The market overall is declining low mid-single digits, but it's not declining everywhere. Like I mentioned earlier in our conversation. Lexmark has a presence in Asia Pac that we bring to the table in this integration and Xerox's name means a lot in there. So when you're really under-indexed in the broader space, even if it's shrinking, there's opportunity in those spaces. And then when you go up through where it's shrinking and where it's growing, there's the segments like on the color side of things that do drive growth. Lexmark brings the technology that allows us to penetrate in those and Xerox brings the brand recognition to help us. So will print decline? It probably will decline. But as you -- but we can offset some of the decline with these opportunities that I just mentioned, and you have the IT solutions that isn't declining. It's growing 5% to 7% a year. And that's with -- today, they have 12,000 customers on that side of the business. There's 200,000 customers on the print side of the business. So now they have direct access to 200,000 customers and can start to penetrate that and get a bigger mind share with that customer base.

Okay. That's important. And I want to touch on Asia in kind of multifaceted question, somewhat related but somewhat unrelated. One is pricing aggression from peers in Japan. What does this combined Xerox-Lexmark entity do to combat that pricing aggression? And then second, talk to me about that Asia opportunity because obviously, following the Xerox JV dissolution, Xerox wasn't necessarily in the region. Now they are. So you have a brand, you have a product. What is the opportunity there when we talk about stabilizing top line? And kind of how long does it take you to get there? You mentioned it doesn't happen overnight, but it's a big opportunity.

Yes. No, you touched on all the right things there. So let's go back -- what's the first part of the question?

Just Asia price aggression from competitors, how do you combat that?

Honestly, we watch pricing very closely because we want to be reactive to that and make sure we're not outpriced in the marketplace. It's been pretty static. There hasn't been irrational pricing. But as you -- you have to know that Xerox and Lexmark, the combined company, Xerox, we don't play in the very low-end segment of printing, kind of that A4 less than 20 pages a minute. We don't play in that meaningfully. And those will be more price sensitive than some of the upper-end parts of the segment. Once you move up that stack, you actually become total cost of ownership, and it's not so much priced out of the gate. It's serviceability, total cost of ownership that you take your value proposition to the customer. So we've been able to do that through that, through focusing on a total cost of ownership and we sell that to the customer when we go to them. When you talk about the market in Asia and how fast you penetrate it, what I can tell you is the Xerox name is big. And you're right, it takes time. So first thing we have to do is integrate the products, and we have to get Xerox's name on products that go into that marketplace, but we're starting that work right now. And I anticipate it to be like a snowball rolling downhill. I think it's going to catch momentum pretty quickly.

Okay. Perfect. Okay. Amazing. And then just areas of innovation or differentiation within print. Obviously, you talked about kind of the manufacturing side. That's an important one, especially as it relates to margins. But from a share shift ability to be different from your peers, where are you guys leaning into? Where are the opportunities that you guys see as this combined entity now?

Yes. It's a little bit of what I touched on at the beginning of the last question. We try to take total cost of ownership and serviceability into account. And we go to our customers with that value proposition in mind, and we sell them on that, right? We don't -- we're not trying to be the lowest place in town on any product that we sell. But we want to be helpful to the customers. We don't want the customers have to touch the box over and over again. And if you think about it over the life of the program, are they more cost out of pocket or less cost out of pocket. And our value proposition would say you're less out of pocket.

Okay. So maybe just wrapping up the conversation on print before we move to other aspects of the story. As CFO, how have you factored in, let's say, market performance, share shifts, pricing, any one-timers? Just like if we add those all together, how will we think about each factor to ultimately get it, how you're thinking about the world in 2026 from a guidance perspective?

Yes. We factored in -- if you think about the different segments we planned, we talked about print declining in low to mid-single digits. We talked about IT solutions growing 5% to 7%. That market, the total addressable market that we play in growing 5% to 7%. We think the Xerox legacy print will move about with market, low to mid-single digits. We think Lexmark will move slightly better than market. You can think of it to neutral to slightly down. And we think IT solutions will outpace the market.

Okay. So let's move into kind of digital and IT solutions, a major initiative. Obviously, a smaller business today but clear intentions to make that a bigger, more relevant business. What new services are you kind of cross or upselling? It's a very competitive market, obviously, very fragmented. So how does Xerox win? What's -- basically, the question is you take an ITsavvy, you bring it into Xerox, what's the special sauce that Xerox now uses to make this, again, a 5% to 7% plus grower?

Yes. No, good question. First, I would say it's not a material piece of the business. When you combine IT solutions with digital services, you're over $1 billion of business per year. So it is material as you think about it in totality. And when you bring, and I mentioned it a little bit earlier, when you bring IT solutions and ITsavvy into Xerox, you're moving from a 12,000 customer reach to a 200,000 customer reach. So that cross-selling -- and these are partners largely in the large enterprise space, these are partners that Lexmark and Xerox have maintained for 20-plus years. So deep relationships in here. And now we're giving at least a voice, at least given ITsavvy, IT solutions a seat at the table to say, look, we can do more for you than print. And they already trust us. They've stuck with us this long. So it gives you that foot in the door to help drive that value proposition to give you the end-to-end product portfolio that I talked about.

And what is the goal or target for the size of this business? Where do we say -- again, I know that's going to be a moving target, I understand over time. But the initial target that I think is we want this to be 20% of the business. It's just -- I think that's the answer, but just time line to get there, size, just maybe outlined that for us...

Yes, I think midterm 20% makes sense to say, but I don't even want to throw a number out. What I would say is we're sitting about 10% to 15% today, and that will grow meaningfully over the next midterm and long term.

Okay. And maybe -- so acquiring ITsavvy kind of leaning into this digital and IT services opportunity does give you kind of a broader exposure to other parts of the IT market, PCs, infrastructure, software services, everything, again, that you can kind of cross-sell beyond what the combined entity could have done before. I realize I'm asking the CFO kind of a demand question, but I'd love to just understand what you're seeing from a demand perspective on the services side because there are kind of cross currents of there's still refresh opportunities, there's cross-sell opportunities. There's also memory headwinds and pricing headwinds. And so like what are the conversations going on with customers right now? What does the pipeline look like? Just broad perspective on what that business is seeing today?

Yes. IT solutions is seeing significant growth in gross billings. Last year, it was double digits. We anticipate significant growth this year in terms of billings. What do we see? So the first thing we do when we go into a customer is we lead with advice. We see what their priorities are, and we help work with them to say, how should you think about this now in light of the things you just mentioned? If RAM is an issue, is it the right time to refresh hardware or should we look at spending your IT budget in other areas? Because now we have a broader product portfolio that allows us to have that conversation. It's very helpful. Because while infrastructure is always going to be a critical need, the demand is not perishable. It's not going away. Might it shift? Yes, it might shift. But we want to keep the same wallet share in that IT budget spend that we can.

Okay. And is there a way that you can maybe help us understand because I think the comments that you made earlier are very important, going from 12,000 kind of customer purview to 250,000 customers. Is there a way you can understand how that breaks down between like large enterprise, SMB, government, public or something like that? And what I'm ultimately trying to understand is on the IT services side of the business, where are you seeing growth tailwinds in each of these cohorts? Where are you seeing maybe some caution? Just trying to understand how that kind of builds up into the confidence that you have for this business.

Yes, we do. We attack it from an industry vertical. I don't know the exact numbers, so I don't want to quote them right now. But if you think about legacy Lexmark, it was largely enterprise, good heavy presence in retail. Legacy Xerox, has a big presence in school, has a big presence in SLED, federal government, big presences there. And so we're attacking from all those angles. I mean, IT solutions is hungry. Now we don't want to spread them too thin, that you don't ever make any traction anywhere. So we try to identify opportunities where there's kind of a fish on the hook and say, let's go after this one because we think there's a real opportunity here.

And from a spending standpoint, can you just help us understand, are large enterprises leading into spend now or SMBs maybe more aggressive and more agile? Is government kind of coming back after the kind of budgetary discussions of last year? Just maybe a little bit of flavor of what your customers are intending to do right now?

Yes. We haven't seen any meaningful shift. We actually have really good demand on the large enterprise space right this minute and good demand on the government space right now. education could be a bit lumpy depending on where their budgets reside in that moment, right? We haven't seen anything slowing it down, really, but we're watching it cautiously. They might be the first one to kind of drag a little bit. So we'll continue to watch it. But as you move down that stack, just like I mentioned on the pricing being more sensitive as you move down, SMB will be the first one to kind of look at where they're spending their capital. And that's where we'll come in and try to advise them on maybe other ways to spend their IT spend -- budgets.

Okay. So as we as kind of investors and analysts think about this opportunity to kind of shift the portfolio from being print heavy to having this kind of tailwind from IT solutions and services, what are the milestones we should be like looking for holding Xerox accountable for? I know there isn't a target mix, but like what are the milestones we should be kind of aware of that you guys have may be set for yourselves?

Yes. Well, we want to outpace the market, right? Market is growing 5% to 7%, we want to make sure we outpace that. We want to watch gross billings very closely. If we can get billings to increase kind of near that double-digit range, then you're starting to get a bigger share of wallet inside these customers, and we want to monitor cross-selling initiatives very strongly, too. How much of the legacy customer bases are we penetrating and how much are we not penetrating to make sure that activity is there. We mentioned we're sitting at about 15% today, 20% is a good near-term goal. We'll continue to watch that growth and continue to evolve it as we move forward.

And so I want to move maybe away from demand and revenue and focus on the margin front, which almost might be more important, more interesting, a lot to do there. So as we could get back to where this business once was. And so on top of the initiatives that you have to stabilize print, kind of accelerate IT solutions, the question is, can you drive gross margin expansion while you do that? Just maybe unpack the opportunities to get margin as we think about what you're trying to do before we get to kind of the cost actions you're taking, but just from the end market perspective, what does that mean for gross margin?

Yes. Stabilized revenue growth, right, we want to stabilize revenue, we want to expand the margins, we want to delever. And I continue saying that mantra internally and externally, so it comes off the tongue pretty easy. And when we stabilize revenue, you might see a little decline in print and increase in IT solutions. The margin expansion that we're going to see there are going to be through higher-value products on the IT solutions side or through the cost synergies that you mentioned. We talked about realizing publicly over $1 billion of reinvention savings through time. We talked about the synergy savings out of the acquisition of Lexmark, driving $300-plus million in synergies. And exiting this year with a run rate of already $200 million plus already being realized. Those will drive significant margin enhancement. Those are coming from both consolidation of workforces where you see overlap and they're coming from the fact that we have in-house manufacturing now. The reason that's important is you have a significantly decreased cost basis on your A3 product, number one, that comes in. And we do our in-house manufacturing out of Mexico, which is USMCA compliant. So it's not exposed to the tariffs.

Okay. Perfect. And then reinvention has kind of taken a lot of twists and turns over time. First, it was, as you mentioned, workforce reduction. Now it's workforce consolidation as we bring Lexmark in. What are the kind of key building blocks in 2026 of reinvention? What is reinvention trying to solve in 2026 that hadn't necessarily been touched prior, so to speak?

Yes, it's the execution. Right now, we're in charge of our own destiny. We own the technology. We've made the acquisitions that we've made for that purpose. We have an engine that can now stabilize the top line revenue growth. And so now it's our job to execute and realize those savings and see that expand the profitability on the bottom line. So in the reinvention started a couple of years ago and Xerox has executed every step they said they were going to execute, right? They change the way they go to market. They did workforce reductions to accommodate that, big acquisitions in ITsavvy, big acquisition in Lexmark. They talk about standing up a GBS environment, which they did early, and now you buy a captive environment from Lexmark that allows you to not be so outsourced and drive significant savings too. And I only say all that to say all the pieces are in place now. We've acquired them. We have to go execute now.

All right. So maybe said differently, most of the heavy lifting in terms of reorganizing things and changing what you guys want to do is done. Now it's let's put the pedal to the metal, let's make sure that we execute.

That's right.

Okay. Okay. Super helpful. I'm going to ask you the one kind of a knowing memory question that I'm basically asking everyone, which is just how are we thinking about the impact of memory cost inflation is having on Xerox. Not a ton of exposure within core print, right, but it could have an impact on IT solution or IT services. So just how are you thinking what role memory inflation plays in the outlook for both revenue and margins?

Yes. Yes. We talked about a little bit earlier on the IT solutions side of things. Infrastructure is always going to be a core tenant of any IT house, and they're going to have to upgrade it, but maybe now is not the time. So maybe that shifts, and we advise and help them find the right priorities for their current IT budget spend. Our goal is to keep the same wallet share that we would have had before. And if it's a different product, we're selling, we're okay with that because we have the ability to do that. If they still want to invest in the infrastructure because they're at a critical time where they need it, that's a pass-through cost that will go to the end customer on the IT solutions side. On the print side, the amount of impact it has on the bill of material can be anywhere from $2 to $100 per box. And the reason I quote the absolute dollar amount is the absolute cost of a printer can go anywhere from $250 all the way up to tens of thousands of dollars on a printer. So it's not a highly material piece, but it's enough to where we'll watch it very closely. And if we need to go work with our customers and say, hey, if a printer stays in the field and continues to print supplies, I'm okay if I wait another year before you refresh it. So we'll do some diagnostic test with them. We'll say, look, this one can last a little bit longer, if you want to make it last a little bit longer to help both parties. We want to help our customer and it also protects our bottom line as well especially on the A4 side of things. The A4 is a little more margin negative out of the gate when you place a printer as the A3 makes a little money. But even on the A3, the annuities and the post sale are always more profitable. So if the ESR remains under pressure a little bit, we're okay. We can absorb that, right? As long as the printers that are in the field today, continue to print and we continue to get the post sale from it.

Right. Okay. That makes sense. So let's kind of combine all these 2 and bring it down to the operating margin level, which there is a clear initiative at least from my perspective, outside of what we've talked about at the revenue side to improve operating margins. Just help us understand the building blocks that get us there? I know on the revenue side, but just at a very high level, what's the goal? How are we going to get there?

Yes. Yes. I think historically, we've been anchored into this 10% number. I don't get as anchored into 10%. I want to get there. I would like to get further than that. I get anchored into I want to set targets that delever our company and allow us to fulfill our obligations going forward. It's a very disciplined approach that I've always tried to use. We know what our expected outflows are going to be over the next several years, right? And so we can back into exactly what we need to do from a bottom line in order to hit those and then develop the actions underneath that. And then look, I think there's tons of opportunity here. 10% is a great target to get to. It will be done through cost synergies, and we have the opportunities to drive those.

Okay. And then maybe a related question is just turning that away from the income statement to the cash flow statement and cash flow. So you're guiding to $250 million of free cash this year. Maybe first part is just the underlying drivers of getting to $250 million of free cash flow. What is kind of core free cash flow generation driven by everything that we're just talking about and then other factors such as the receivables factoring, not to say factor twice. But just what are the 2 building blocks that will get there? And then just a follow-up to that.

Yes. Finance receivables this year, we stated they are about $335 million is the impact that we anticipate to receive out of that. We're facing headwinds in the cash flow from several areas. One is the interest that we pay on the debt that we have outstanding. The more we delever, debt comes down accordingly, number one. Number two, the pension funding. We talked about $150 million to $160 million a year that we're having to fund in the pensions. That will be happening for another year or 2, and then you'll see that start to decline. You look at some of the capital investments that we're making right now because we're bringing manufacturing in-house. We're changing some stuff with our IT stack. As that passes us, that will come down. So there's -- there are tailwinds that will come to help offset as that finance receivable becomes less each year as it already is doing, that will drive the more free cash flow driven from the operations.

And I don't want to kind of pin you down on a number or anything, but is there a rule of thumb or a target in mind when it comes to like core free cash flow conversion? Again, not now, but when we move beyond this and think about all the initiatives you have in place and where you want to kind of get to, is there a target that we should be -- again, not holding you to, but like that you'd like to get to?

I don't know that I've ever put a number on it, so I wouldn't quote one right now. But I want it to be better than what it is this year. And I wanted it to be, of course, enough to fulfill the obligations of the company and service the debt that we have on the books.

Okay. So very helpful. Let's talk about deleveraging. Just a very big focus internally, obviously. Where -- maybe the question is target leverage, how long does it take to get there? And maybe just so we can think beyond kind of more technical is like if -- assuming that you get there, right, assuming that you get to where you want to go, what's next? What's after that when we think about capital allocation?

Yes. Yes, that's a good question. I would say midterm range is to be 3x gross leverage. Yes. And we'll continue to be opportunistic in ways to try to do that going forward here. After we get there, you could see we'll have to evaluate what's possible, but you could see us looking at some tuck-in acquisitions underneath the IT solutions to make sure we can expand revenue even further.

Okay. Great. So I want to maybe be a little bit more specific there and just touch on some of the moving pieces. So the pro rata warrant work that you guys did recently, you had a $450 million JV with TPG that you recently announced. Just at a high level, objective behind these initiatives? How is that -- how are these kind of contributing to exactly what we just talked about?

Yes. Well, the key tenet on both of those, right, is balance sheet improvement. Both those are intended to provide balance sheet management. Number one, let's talk about the warrants. The warrants, what we think it does is it gives us a balance sheet-friendly way to delever and to reduce our debt. It gives our bondholders optionality in how they want to participate with the company. They can turn their debt into equity and participate in the upside. And it gives our equity holders true tangible value because the warrants are worth something in the marketplace that can be traded and drives value for them. So we think of it as a win-win-win for all parties. And if you want to get a little more technical with it, you can think of it and they can turn their gross debt into the price of the stock today to mirror whatever the debt is trading at today. That's what they're trying to do, and it gives them that kind of optionality. So we think it's a low-risk balance sheet-friendly way to help delever the company quicker. The JV that we had set up was to shore up the balance sheet here in the near term. If you follow the print industry long enough, you know that the first half of each year tends to be working capital negative for several reasons, the back half tends to be working capital positive. In addition to that, Xerox is spacing debt amortizations in the first half of this year as well. It just gives us a little bit of headroom as we go through that to navigate it. But at the same time, we're going to continue to look at opportunistic ways to leverage that to delever overall.

Okay. Last 2 questions for me. One, this is just maybe focus on you. What -- for everyone that's kind of -- that didn't follow Lexmark that is new to you, what is your kind of role as CFO? Meaning what kind of CFO are you? I'd love to just maybe get a better understanding of what should we expect, but where do you find your strengths lie to kind of drive this evolution of everything that we just talked about?

Yes, yes. I love the business. I love being involved in it. I love the operations of the business. I tend to approach things with transparency and discipline. And I want to make sure everybody understands the direction we're heading and how we're going to get there and make sure everybody stays focused on that. There's a lot of buzzwords, right, that we throw out. We talk about the warrants. We talk about the JV. We talk about reinvention. We talk about the synergy savings. And you get all these moving pieces that are happening, and I don't want people to get distracted, hit the numbers, execute. If we execute, everything else takes care of itself. And that's the way I typically operate. I don't like to be surprised. I'm not going to tell you I can do something less I believe we can do it. I don't shoot for things like that, right? If I think I can do it, I will tell you, I can do it. And if I can't, then we'll just have to have a difficult conversation about why I got surprised.

Okay. Okay. Very fair. I love that accountability. And just as a quick follow-up to that is the KPIs that we should all be focused on to kind of hold you accountable to what you say you should be doing, is that revenue growth and operating margins? Is that operating profit dollar growth? Like what are the focused KPIs we should all be looking at to say Xerox is doing what they said they were doing?

Stabilize the top line, expand margins and delever the company. And we put guidance out to the Street. We said we'd be greater than $7.5 billion this year. We said we would be between $450 million and $500 million of operating income. I feel very encouraged about those. I hope to be coming back to you at some point during the year and saying, we did that and we can do a little bit more. We'll see how the year unfolds. But that's the goal, hold me accountable for what I told you, I could do that.

Awesome. I love that. I love that. Last question, and this is maybe just the kind of wrap up for everything is we covered a lot. There's a lot that's changing. There's a lot that you guys are leaning into. Just maybe what -- when you look out in the investment landscape, what are investors perhaps not fully appreciating or not fully understanding that you kind of want to communicate that message to everyone to say like, here's why we should be excited about the future. We have to execute through it, but here's kind of what you don't fully -- you might not fully appreciate about what we're doing under the hood.

Yes. I think it's the same thing I just mentioned about internally when I have these conversations. It's confusing sometimes right now. There's a lot going on. We've executed a couple of big acquisitions. We did the JV. We did the warrant distribution. And there's just -- it keeps -- what I want people to know is through all that, right, we're in charge of our own destiny now. We own the technology now. We own the capabilities from a back-office structure and a shared service center. We have access to markets we didn't have before, right? Everything is in our control. We have to go execute now. But we have everything in our control to go do that, right? I can understand completely, if you look back at the history of what's happened over the last couple of years and how we've done on earnings versus what we've sent the Street, why people would look at us with a raised eyebrow. But we're in control of it now, and we're going to execute accordingly.

Okay. I think that's a great place to end. Awesome. Thank you. Chuck. Thank you very much.

I appreciate that, Erik. Thank you.