DBD - NYSE

Hello, good day, and welcome to Diebold Nixdorf's first quarter 2025 earnings call. My name is Kate, and I'll be coordinating today's call. Following your speaker's remarks, there will be a question-and-answer session. [Operator Instructions]. I'd now like to turn the call over to our host, Chris Sikora, Vice President of Investor Relations. Chris, please go ahead.

Hello, everyone, and welcome to our first quarter 2025 earnings call. To accompany our prepared remarks, we posted our slide presentation to the Investor Relations section of our website. Before we start, I will remind all participants that you will hear forward-looking statements during this call. These statements reflect the expectations and beliefs of our management team at the time of this call, but they are subject to risks that could cause actual results to differ materially from these statements. You can find additional information on these factors in the company's periodic and annual filings with the SEC. Participants should be mindful that subsequent events may render this information to be out of date. We will also discuss certain non-GAAP financial measures on today's call. As noted on Slide 3, a reconciliation between GAAP and non-GAAP measures can be found in the supplemental schedules of the presentation. With that, I'll turn the call over to Octavio.

Good morning, everyone, and thank you for joining us. Starting on Slide 4, 2025 is off to a strong start with Q1 performance on track with our expectations. By staying focused on execution and exceeding customer expectations, we delivered another quarter of standout results. Importantly, we are maintaining our financial outlook for 2025, while monitoring the tariff situation. Our market leading automation and self-service technologies drove a significant 36% year-over-year growth in product orders, with growth across banking and retail and in all major geographies. We saw continued strength in the adoption of cash recyclers. This robust momentum positioned us well to achieve our revenue growth in the second half of the year. Our lean operating model and continuous improvement mindset are delivering. Gross margin expanded 20 basis points year-over-year and 140 basis points sequentially. We are starting 2025 on solid footing and are making solid progress to hit our three-year targets, growing product gross margins 25 basis points to 50 basis points annually and service gross margins approximately 100 basis points annually. We are maintaining our fortress balance sheet with low net leverage to support our capital allocation priorities, while strengthening our free cash flow generation. We generated $6 million in positive free cash flow in the quarter, the best first quarter in our company's history, as we deliberately take steps towards improving our cash flow seasonality, and we are delivering for shareholders, kicking off our $100 million share repurchase program in March by repurchasing $8 million of DN shares. We are proud to take this important first step to increasing capital returns. We believe there is upside potential to our stock and we expect to continue executing this initial program in a prudent manner. In line with our commitment of maximizing value, we remain focused on returning capital to shareholders in the form of share repurchase. Regarding the geopolitical backdrop and the new tariff policy, we're prepared for tariffs, given our long-time global operations and investments in local-to-local manufacturing. There are some areas of potential impact in our supply chain, but the team is already taking action, leveraging our local manufacturing and LEAP principles to keep costs in check. Tom will dive deeper into this in a moment. I am incredibly proud of our global team for staying focused on delighting customers and advancing our continuous improvement culture. Let's move to Slide 5, taking a step back, we wanted to reiterate what we see as the key drivers of value creation for Diebold Nixdorf, which we communicated at our February 2025 Investor Day. We are focused on delivering on the three-year growth acceleration plan we set to drive meaningful value as a global leader, providing mission critical hard work, service, and software transforming the way people bank and shop. To that end, we are delivering across three key pillars. First, we're capturing secular tailwinds across our two complementary businesses, banking and retail, where customers continue to seek more self-service and automation solutions. Both banking and retail are large and growing opportunities representing a combined 32 billion total addressable market. Second, we are driving growth and improved profitability. In banking, we are accelerating growth through branch automation solutions and fit-for-purpose devices and through a long-term ATM refresh cycle. In retail, we are driving enhanced AI-driven checkout capabilities and penetration of the North American market. We are improving profitability through our lean operations. There are significant operational efficiencies being unlocked across the organization. This is really becoming part of our culture and ingrained in the minds and hearts of our employees. We are seeing great action from our team, and we expect continued benefit from these initiatives. Third, we are increasing our cash generation. Higher free cash flow conversion enables us to increase shareholder returns via share repurchase. Taken together we believe our plan will enable us to deliver mid-single-digit annual revenue growth by 2027, as well as double digit adjusted EBITDA growth and 15% margins by 2027. This works out to 800 million in cumulative free cash flow over the next three years and 60% plus free cash flow conversion in 2027, while maintaining a fortress balance sheet and increasing capital return for our shareholders. With that, I would like to turn to slide six, where we will discuss our growth acceleration strategy progress. I'm excited to share that Q1 shows we're already advancing on the priorities we outlined. In banking, we are transforming how financial institutions operate with cutting-edge branch automation and tailored ATMs for high-growth regions like Asia Pacific and the Middle East. Our branch automation solutions integrate advanced ATM and teller cash recyclers with our pre-packaged managed service and software offerings, enabling banks to streamline operations and enhance customer experience. We're gaining traction with the number of large national and regional banks in the US, and our pipeline continues to grow. Meanwhile, our tailored fit for purpose ATMs and recyclers like the India made units now rolling out are designed for local needs, compact, energy and cost efficient, and paired with bundled software and services. Similarly, our high capacity recycler unit developed for the Middle East and Africa has allowed us to win several new logos this quarter. By expanding our install base in this high growth regions, we will drive high margin recurring service and software revenue. In retail, we are redefining self-checkout with AI-driven solutions like Vynamic Smart Vision. This technology uses advanced computer vision to reduce shrink by detecting on scanned items and streamlining checkout with automatic produce recognition, saving times for shoppers and cutting costs for retailers. Pilots are underway with major chains, showing strong results, including a 70% reduction in fraud for one of our European customers. Beyond applying AI-driven solutions that self-checkouts, we are leveraging our deep expertise to deploy fraud prevention solutions at the traditional point of sale terminal and the store aisles. And as we execute our North America expansion strategy, our investments in local manufacturing in Ohio and expanding our North America sales team are showing steady progress with opportunities identified that would contribute to the expected second half recovery in 2025. On manufacturing, supply chain and product, we remain well-positioned to achieve our targets, given our established strategy of local-for-local manufacturing and the initial impact of applying lean principles. We are acting swiftly to deploy mitigating actions for our supply chain in phase of rising tariffs, and accelerating our development of an in-country supplier base to help mitigate pricing costs. We also implemented targeted price adjustments in North America. And in services, we are rolling out Oracle Deal Services and combining it with our all-connect data engine analytics platform to deliver faster, smarter support, making our customers' lives easier. These solutions aren't just about innovation. They're about solving real problems and creating lasting value for customers and shareholders. Now, on to Slide 7. Service is the heartbeat of our business, and in 2025, we're doubling down on making it world-class. In Q1, we held intensive Kaizen events across six countries, from Canada to India, and as you can see from the pictures, hundreds of employees participated. We are advancing our cultural transformation and helping streamline how we serve our customers. The results are clear. Improved safety for our teams, faster repairs, fewer repeat calls, happier customers, and a reduction in average days of inventory on hand. As I met with many of our customers this quarter, I was encouraged by the recognition of the positive impact we're driving in their operations. These improvements do more than delight our customers. They boost margins, strengthen loyalty, and ensure technicians work safer, fueling our team well-being and profitability. By pairing lean principles with tools like Oracle Deal services, we're not just meeting service agreements, we're focused on exceeding them consistently. This is our path to becoming the undisputed leader in service, delivering unmatched value to our customers and shareholders alike. With that, I'll turn it over to Tom to walk us through our financial results.

Thank you, Octavio. Starting on Slide 8, we provide a five quarter financial trend, which shows how our business typically builds throughout the year. Overall, first quarter results represent a solid start to the year. Most importantly, we delivered in areas that position us well to achieve our full-year objectives. First quarter product backlog increased to approximately 900 million up from approximately 800 million at year end on strong new order entry, which was up 36% year-over-year with improvements across both banking and retail. Coming into the year, we expected a 45-55 revenue split weighted to a strong second half of the year, and our teams are converting on those opportunities. Our first quarter performance, along with achievable Q2 order entry targets, will give us approximately 80 to 90% visibility into full-year product revenue, and this is supported by our April order entry levels. Gross margin continues to improve, up 20 basis points year-over-year and 140 basis points sequentially, primarily due to better geographic and product mix, as well as the impact from our lean initiatives. We are maintaining our cost discipline and continuing our work to improve our overall cost profile. In the first quarter, operating expense was up year-over-year due to higher incentive compensation and investments in supporting our strategic growth initiatives that Octavio outlined earlier. Continuing on to Slide 9, we remain committed to strengthening our profitability and improving our free cash flow generation. We delivered adjusted EBITDA of 87 million in the first quarter. We also generated 6 million of free cash flow in Q1, which is the best first quarter performance in Diebold Nixdorf’s history during our seasonally weakest quarter. This is a solid start on our journey to improve free cash flow conversion to 40% plus in 2025, which was driven by lower interest expense, working capital efficiency around inventory and accounts payable, reduced professional fees as well as a better process around timing of non-income tax-related payments that benefited the quarter. I also want to reiterate our commitment to increasing transparency for investors and our results. Our first quarter results represent an initial step for us in delivering simpler, easy-to-understand results with fewer adjustments to EBITDA. Moving to Slide 10, banking delivered another solid quarterly performance with accelerated adoption of cash recycling technology and its associated software and service business. Order entry was very strong, up approximately 50% year-over-year, and supports our revenue outlook for the year. Banking revenue was up 9 million year-over-year, excluding the impact of FX and the non-recurring Brazil tax item in Q1 of 2024. Gross margin was up 20 basis points year-over-year and 180 basis points compared to the prior quarter, with margin expansion across both product and service, driven by the impact of lean initiatives and improving North America service performance. We continue to see strong ATM refresh activity and the adoption of recycling. The initial traction we are gaining with branch automation solutions and our fit-for-purpose product portfolio, plus our outstanding order entry performance gives us confidence for the remainder of the year. Turning to Slide 11, the macro environment continues to impact retail product revenue, but as we mentioned before, we are seeing signs of stabilization that point to a second half recovery and sequential quarter improvement throughout the year. This is supported by our improved order entry in the quarter, up approximately 10% with stronger demand for our self-service solutions. In the U.S., we are gaining traction and building a strong pipeline with several new customers conducting proof-of-concepts and pilots with our solutions. Despite declining volumes, gross margin was up year-over-year and sequentially, as we continue to implement our lean operating principles and maintain pricing discipline. We are confident in our ability to improve service margins in 2025, given that most of our self-service deliveries represent new deployments in the market. Despite the near-term market challenges, our long-term outlook in retail remains positive. We are especially excited about our Vynamic Smart Vision capabilities and early positive signs in North America with a growing pipeline. Moving to Slide 12. We wanted to share additional details with you on how we are framing the tariff policy risk. Keep in mind that we have dealt with tariffs in the past, as we are a global company operating in more than 100 countries. As we have previously stated, our local-to-local manufacturing structure means we don't anticipate a material impact from tariffs. However, given the evolution of the tariffs announced, we wanted to provide a little bit more context. Importantly, even despite broader and higher tariff policies announced since we last spoke, we continue to reiterate our original 2025 financial guidance. Based on enacted or proposed tariffs, we estimate the gross impact for 2025 is approximately $20 million, and we are working to mitigate up to approximately 50% of the headwind for the year. Our 2025 guidance ranges incorporates this framework. However, we will continue to monitor and adjust if required, as the tariff landscape continues to evolve and our mitigation efforts take hold. We see the largest impact from our imports from China and Germany, collectively about $15 million, based on current tariff conditions of 145% for China and 10% for all other countries. Our framework assumes these conditions remain in place for the full year. Our mitigation strategies prioritize the impacts from China and Germany with accelerated productivity efforts from our lean initiatives, sourcing alternative parts, negotiating with our suppliers, and where appropriate, pricing initiatives, and as required, greater SG&A controls. Keeping this in mind and turning to our guidance on Slide 13, we are maintaining our 2025 guidance ranges, our solid start to the year, combined with the current demand levels and our backlog, reinforces this outlook. However, as a global company, our visibility is affected by the recent macroeconomic uncertainty, and we will continue to monitor this going forward. We are still planning for low-single-digit banking and retail revenue growth in constant currency. The FX environment has been volatile, so we'll continue actively monitoring for potential impacts. As it relates to quarterly cadence, we continue to expect revenue to be weighted towards the second half of the year, with a 45% first half and a 55% second half. This split is based on our customer orders currently in our backlog. In 2025, we expect adjusted EBITDA to be in the range of $470 million to $490 million, primarily driven by continued focus on service gross margin, with the team targeting approximately a 100 basis points of gross margin expansion through lean operations. In manufacturing, we expect a small incremental improvement in full-year product gross margin by maintaining operating expense discipline. Free cash flow is expected to be in the range of 190 million to 210 million, representing 40% plus free cash flow conversion. We remain confident in our ability to deliver another strong year of results and build upon our improving SAYDU ratio. Moving on to Slide 14 with more details on our free cash flow outlook, there is nothing more important to the company than strengthening our free cash flow. We are pleased with the progress so far in the first quarter, generating $6 million of positive free cash flow as this helps to de-risk the year and is a key step toward improving our seasonality. We have line of sight to deliver on our free cash flow guidance range based on the debt pay down and refinancing we completed in December of 2024, which provides 70 million in annual cash interest savings, $30 million contribution from higher adjusted EBITDA using the midpoint of our guidance range driven primarily by service gross margin expansion. Approximately 20 million contribution from reduced professional fees related to our corporate restructuring, and we are also factoring into our bridge approximately $30 million of impact from strategic investments, including CapEx combined with the impact of strong accounts receivable harvesting in 2024. This outlines what we can achieve this year as we drive towards our goal of free cash flow conversion of 60 plus percent over the next three years. Turning to Slide 15, we are benefiting from our fortress balance sheet and bolstered liquidity position that support our capital allocation priorities. At the end of the quarter, we have more than 635 million of liquidity, comprised of 328 million of cash and short-term investments and 310 million of capacity on our revolving credit facility. Our net leverage ratio is 1.5 times, well within the range we have set for the company of 1.3 to 1.7 times, representing one of the strongest balance sheets in the industry. And after executing the first 8 million of share repurchase in March, we expect to continue strategically executing on our remaining 92 million authorization throughout the year. This is not the Diebold Nixdorf of old, the work we have done to build our fortress balance sheet and implement our local to local manufacturing footprint, are foundational elements for the company, and position us well to serve our customers and respond operationally to the current macro uncertainty. Lastly, this is another quarter of DN doing what we said we would do and we intend to keep this positive momentum through the remainder of the year. With that, I'll turn it back to Octavio for some closing comments.

Thank you, Tom. To wrap things up on Slide 16, we delivered a strong quarter, focusing on our customers and employees while improving operations, demonstrating significant progress against our multi-year growth plan. In banking, we see steady demand for our DN series ATMs and our focus on optimizing the end-to-end cash ecosystem with our branch automation solutions. In retail, we have invested in accelerating our North America growth opportunity and enhanced our self-service offerings with AI capabilities. Retailers are impressed with how our solutions address their pain points and drive higher efficiencies while better serving their customers. We have made tremendous improvements in building efficiency in our operations through a disciplined lean culture. We are expanding our lean efforts throughout the enterprise over the course of 2025 and beyond, and we are focused on maintaining a fortress balance sheet and nearly doubling year-over-year free cash flow generation. My thanks go to our 21,000 employees around the world, as we work to build a top performing company. It is an exciting time at Diebold Nixdorf. We have taken numerous steps to position the company for long-term success and create value for our customers and shareholders. And with that, operator, please open the line for questions.

Thank you. We will now begin the question-and-answer session. [Operator Instructions] Our first question will come from the line of Matt Bryson with Wedbush. Your line is open.

Hi, sorry. Sorry about that. Some problems been muting on my end. Thanks for taking my questions and congrats on the positive cash flow.

Thanks, Matt.

The new orders or the backlog growth was impressive, particularly in Q1. It looks like it was broad-based across both product categories. Can you talk a little bit more about kind of what you saw driving that, both on the banking and the retail side?

Yes, thanks. So, look, what we're seeing come through healthy banking, cash recycling adoption, right? We continue to see strength in Europe and Latin America, improved retail self-service activity, both of which support our second-half recovery, and then, we're also seeing robust momentum to help us really achieve our revenue growth, not only in the second quarter, but for the remainder of the year. Remember our weighting of revenues is 45%-55%. So, hitting the order entry targets that we have for ourselves in Q1 was important, and given what we're seeing, the activity in April, this continues to support our expectations for a solid full-year, and I will say, look, I'm almost a year into the role. So, my history isn't that deep, but at this point, we have about 80% to 90% visibility onto our full-year product revenue. And again, as you mentioned, backlog did increase from approximately $800 million at year-end to $900 million at the end of the quarter.

And I mean, it sounds like on the tariff side, you guys are, the impact isn't that substantial, and you already have mitigation plans in place to offset at least a portion of the tariffs. But did you, have you seen customers at all accelerate their order rate given kind of uncertainty around what things might look like going forward, not really playing to your business at all.

Not in business, Octavio, so Matt. No, not really. Remember, the tariffs were announced, you know, after our quarter had ended. So even though there was some talk about it, there was no real impact during Q1 of the tariffs. So, I would say that it's just the strength of the business during Q1 that drove the higher orders in the quarter. I have the chance to speak with many of our customers here in the US both in banking and retail. We have, and we touched that after the quarter ended on the possible impact of tariffs, and I would say that customers understand that there might be an impact in pricing, but they're all, nobody has expressed any real concern about a slow down or changing their investment plans for the year.

Awesome. And just one last one for me and I'll jump back in the queue. You have a relatively large foreign exchange expense, I think it was 18.5 million. Can you just talk about the dynamics there are obviously currencies fluctuated a lot this past quarter bid, if that hadn't been any income statement the net profit would've looked really good.

Yeah. So, first, let me reiterate, right, this is non-cash, non-operational impact to our P&L tied to our intercompany loans and what we've seen the volatile currency fluctuations in the first quarter. So again, it's driven primarily by some of the loans that we have with Brazil and Europe through our sort of internal banking structure that lost value from a weakened dollar, right? We've seen some of this reversal of this trend in the second quarter, and this is something that we intend to monitor as we go forward through the year. But again, just let me reiterate, non-cash, non-operational.

Yeah, that's what I wanted to hear. Because again, if that wasn't any income state that the net profit would've been a positive surprise release versus I think consensus. Thanks for the color, guys.

Our next question come from the line of Matt Somerville with DA Davidson. Your line is open.

Thanks. Excuse me, a couple of questions. First, just back on the banking side of the business orders up 50% year on year. Can you maybe just give a little bit more granularity in terms of how that played out across the four major regions in which you compete and additionally just with respect to recycling adoption, are we starting to get a little long in that cycle at this point, or do you still see, or I guess how much runway do you still see therein and then I have one or two follow ups.

Sure, Matt, I'll start with the refresh cycle, and recycling adoption. I would tell you that we're still fairly early, just at the beginning of the year, we shipped, I think 200,000 DN-series ATM globally. If we look at our install base, we still have 600,000 devices to upgrade. So, we're, you know, roughly, 25, 30% in. So, I still think we have a lot of runway to go. Again, the major markets, when I look at them, kind of support this thesis that we still have a long way to go. When I look at the U.S., again, important new orders around recycling, but some large financial with some of the largest financial institutions in the country that keep, that are in the midst of a refresh cycle and we see that now permeating to the regional accounts and credit unions, community banks across the U.S. So, the U.S. had very positive momentum through the first quarter, a lot of forwarder activity. So, we feel good about the U.S. We are very focused in the U.S. on how do we improve or keep improving our service because that keeps being the driver of additional customer awards. The better service we provide, the more orders we get for product. And I think as customers see our improvement in our service operation and how we're modernizing things because they reward us with more orders. So, very happy with the performance in the U.S. or North American market. If I go to Europe, Europe continues to be a very positive surprise for us in the ATM side. As you know, Europe is a very stable market. A lot of consolidation and a lot of these shared networks across banks in multiple countries, but we continue to win. So, even as bank networks consolidate, we continue to gain share and gain a better part of those networks. So, in France, we've had significant awards, in Belgium, so we continue to see us winning in the European market. And again, as I mentioned, a very positive surprise, very proud of our European team as they're clearly winning share in that market. Latin America, as you know, cash heavy society still, we keep talking about Brazil and the big banks and how that plays out through the year. I'm happy to report, Matt, that in Q1, another big opportunity was one in Brazil with TechBank, the bank, the network owned by all the banks there in Brazil. So, a large order that we were able to start delivering, even in late March for the customer. So, we continue to see that momentum across Latin America. And lastly, Asia Pacific. As we've mentioned before, we've built this very deliberate strategy that we're calling the fit for purpose devices. Our first products in India are now officially in production being certified by multiple customers. So, we feel good about the prospects there, strong order entry in the Asia Pacific, Middle East region, and we also have the significant success with our high capacity recycler, the highest capacity recycler for markets like in the Middle East, like Saudi Arabia, the Emirates, where we won significant new customers. So again, I would say that this quarter we saw very healthy demand for our banking products across our four regions. And as Tom alluded, April, we see the trend continuing even in the face of the global uncertainty. And for retail, I would say that we are happy that retail orders were up on a year-over-year basis. So, we're starting to see that trend, and I'm also proud that the new U.S. team that we built for retail has created a very solid pipeline of opportunities that I'm sure will fuel our growth in the second half of the year.

So, I want to thank you for that detail. I want to sort of dovetail off your last comment on the retail side of things in North America. You're obviously talking about that. You've said it twice now that that's going to contribute to your growth in the second half of the year. So, help me understand, do you have customers in hand? Do you have anything more tangible you can give us? Obviously, talking to some of your teammates at the Analyst Day, they're pretty upbeat about potentially breaking into some of the biggest, most sophisticated retailers in our country. So, maybe if you can give some additional color there, that would be helpful.

Yeah. So, Matt, clearly, I don't want to get ahead of ourselves, but we have pilots and proof of concepts in some of the largest retailers in North America as we speak. So, remember, you know, we are the new kid on the block, per se, in the U.S. market. So, our products are being tested by some large grocers, by some large general merchandising companies. And again, as those pilots evolve, we feel that same as we've done in Europe, the technology and the solutions will prove themselves valuable, and again, as these large companies make their purchasing decisions, I think we have a real shot of starting to gain market share in the U.S.

We will take our final question from the line of Justin Ages with CJS Securities. Your line is open.

Hi, morning. Thanks for taking the questions.

Yes, Justin, go ahead.

On the improvements in free cash for both in the quarter and for guidance and long-term guide, can you give us some more color on the working capital improvements? I know you mentioned accounts payable was positive or contributed positively this quarter, but a bit of a AR headwind, so just hoping to get some more detail there.

Yeah. First let me just, I want to congratulate the organization on the first quarter free cash flow results, right? Positive six. Again, reiterating what we said in our opening remarks, right? That' the first time perhaps ever, and certainly in a long time, to be able to achieve positive cash flow in what's our seasonally the lowest quarter? And if I were to bridge sort of Q1 of ‘24 to Q1 of ‘25, right? Obviously, the financing that we did at the end of Q4, alleviated cash interest expense, and we did we do have less volume, so we do have less EBITDA, so that eats some of that up. We did have favorable working capital, efficiencies on inventory and AP. Again, the new Diebold very conscious about when we start to buy the raw materials to get into production for the second half of the year. So, I think you're starting to see more operating discipline on the manufacturing side of the house. Last year we did, we had a lot of AR coming out of bankruptcy that we're able to sort of seize on and collect. So, that'll be a headwind for most likely the remainder of the year, but we expect continue to drive DSO and continue to drive inventory and AP. But in addition to that, we did have reduced professional fees as well, which helped, but one of the things that I'm, again, it's kind of the new DN team here. We exercised a better discipline about what we did, in terms of getting prepayments in the fourth quarter of the year. So, if you were to go back in time to 2023, we spent a lot of time issuing discounts and getting prepayments into the fourth quarter of 2023, which resulted in a very large, VAT payment, in the first quarter of 2024. So, the management team, we discussed that. We did not think it was worth the discounts to drive that level of prepayments. We let things happen more in the natural rhythm of the business, and because of making that decision, we sort of ended up in the same place, a better place, but we didn't have the discounts and the VAT timing was much more manageable, and that really improved free cash flow by about $20 million. So, again, it's the operating discipline that we're starting to execute instead of doing things kind of the way we always did.

Very helpful. Thanks for the comprehensive breakdown. Then my last question on capital allocation priorities. Can you just walk us through how you're thinking about that, especially in light of starting to generate more free cash flow? I know you repurchased $8 million of shares this quarter, but just want to get a sense of that going forward.

Yes, happy to. So, it wasn't $8 million, it was $8 million in shares this quarter, but it was only our program, if you may recall, started in March. So, it was really one month. So, a typical quarter would be more 8x3, and depending upon the seasonality of our cash flow towards the end of the year, we would expect to increase it. Let me be clear and I think Octavio and I were pretty succinct about it in our IR day, right? Our excess cash is returned to our shareholders. Right now, we feel the best ROI is our stock price, and that is what we're doing. We're executing through the share repurchase. I would say, everything else is kind of in line, as it relates to the some of the investments that we need to continue to make here, in terms of CapEx and to drive our growth strategies forward, but that excess cash flow is being returned to shareholders, vis-a-vis, the repurchase.

Thank you. At this time, we have no further questions. I'll now turn the call over to Chris Sikora for his closing remarks.

Thank you for participating in today's call and your interest in Diebold Nixdorf. If you have any follow-up questions to the call, please feel free to reach out to investor relations. Thanks again, and have a good rest of the day.