Conference Transcript - RVTY 2026-09-14

Mike Padoll, Analyst — Morgan Stanley

Great. Welcome, everyone. My name is Mike Padoll. I lead our U.S. life science tools and diagnostics coverage on the health care investment banking side at Morgan Stanley. Pleasure to be joined here by Max Koujak, the CFO of Revity. So maybe to kick things off, Max, Revity is an organization that's been through a pretty big transformation over the past several years. And so for an investor that's newer to the Revity story, what do you think the simplest way is to kind of understand where the business is today?

Max Krakowiak, CFO

Yeah, I think, as you mentioned, we've undergone a tremendous amount of transformation. And I think the company we now have is an innovative life sciences and diagnostics company that's focused on differentiation. You know, I think when you look on the life sciences side, we are focused on preclinical research. And then on the diagnostic side, we really have specialty focus across reproductive health, autoimmune, and allergy markets. And so, as you mentioned, we've gone through a tremendous transformation to simplify the portfolio, again, with a big focus on innovation and differentiation. And I'm sure we'll get into more of the transformation as we go along here.

Mike Padoll, Analyst — Morgan Stanley

Yeah. So on that transformation, can you talk a little bit about how that kind of positions you for the future, where you're heading, especially within the context of AI and log sciences?

Max Krakowiak, CFO

Yeah, so maybe even just spending a little bit on the transformation overall, you know, from our standpoint, if you look at where we've gone to, you know, for us, the big areas of focus was one being in highly competitive market positions and faster growing markets. And we think we've accomplished that now with our focus across life sciences and diagnostics. We've also undergone a tremendous amount of, I would say, cultural transformation over the past few years becoming Revity. You know, I would say we were a little bit more of an old-school, scientific, heavy instrument-based company, and now we are much more focused on innovation, scientific differentiation with a much higher mix of reoccurring revenue. And then I think if you look at the financial transformation, you know, we've also taken a significant step change there. You know, I've already mentioned that we're in faster-growing end markets. If you look at our cash flow conversion performance, it's dramatically improved since becoming Revity with the new portfolio and operational execution. You know, our conversion now has been consistently north of 90% versus historically 70%. And even when you look at it from a margin profile perspective, you know, this year we're anticipating being upper 20s from an operating margin standpoint. Before the transformation, it was low 20s, which is a significant change over a short period of years and I think, again, really a testament to the vision we had we wanted to create.

Mike Padoll, Analyst — Morgan Stanley

You've talked before about the longer-term kind of growth algorithm or the long-range plan being in kind of that 6% to 8% range, how would you kind of deconstruct that? What are the kind of constituent components of that growth, and how should investors think about that?

Max Krakowiak, CFO

Yeah, so for the 6% to 8% long-range forecast for us as a company, the key baseline assumption is that in a normal market environment, markets grow sort of mid-single digits, and we should be growing several hundred basis points above that. I think when you look at the 6% to 8% and how it decoms by business unit, diagnostics is probably maybe slightly on the lower end of that 6% to 8% range with life sciences being on the upper end of that range. And I think even when you look a little bit further underneath both diagnostics and life sciences, from a diagnostics perspective, we have two main business units. You have your reproductive health franchise, which in our LRP is assumed to grow 2% to 4%. It's been growing nicely above that, which, again, I'm sure we'll get into some details on. And then on the immunodiagnostic side, you know, 9% to 11% LRP, where it's mostly been executing within. I think then on the life sciences side, where we have two business units, our life science solutions, which is our instruments and reagents, we anticipate that sort of, I would say, being in the mid to high single digits growth over the long term with maybe some particular tailwinds that might drive us to grow above it, one of which you mentioned around sort of this AI momentum. And then we've got our software business, which we anticipate growing 9% to 11% over the LRP, and it's actually been probably growing above that as well over the past couple of years.

Mike Padoll, Analyst — Morgan Stanley

The past several quarters, I think, in the tool space more broadly, I think a lot of us are all aware of some of the challenges, but Revity has managed to grow the reagents business in most of those quarters. um where do you where do you how should investors think about where uh that growth is coming from is it you know market share gain um and where do you see that business position going forward and you know what do you need to do to drive more accelerated growth even yeah so i think if you look at it from a overall reagent perspective as you mentioned last couple years have been a challenging market environment i think though we've been very encouraged that we've been able to grow i think several hundred basis points above that sort of market or peer average over

Max Krakowiak, CFO

those past couple of years, which is a testament to the strength of our portfolio. And I think when you look at what's the real differentiation for us on a reagent standpoint, I would call it a couple of factors. One, we are, I would say, very proud of our customer relations and really our ability to deliver best-in-class service. More than 95% of our reagents are delivered within 24 hours of the order, which is a true strength for us from a customer engagement perspective. I'd say additionally we pride ourselves in being one of the more innovative reagent companies out there, but also being able to deliver that innovation with incredibly high quality at the best value price in the market. And I think third, I think when you look at our overall reagents portfolio, we do have some, I would say, very strong full value chain offering for our customers in their preclinical research and being able to span across their full continuum of needs. So I would say that differentiation is what's really led us to grow above market over these past couple years, I think when you then flip it in terms of saying longer term, you know, what do you need to get to to sort of get back to that LRP growth? I think it's a combination of factors. One, you know, if you look at things from an academic and government perspective for us, that's, you know, roughly about a quarter of our reagents exposure. You just need more stability there from a policy perspective. You know, that whipsaw makes it very difficult for customers to sort of plan over the long term and be comfortable sort of releasing their budgets. I think the bigger concentration is obviously with pharma biotech, though. And I think over the past couple of years, you've seen a real pinch down on the budgets from a preclinical perspective. That narrative has definitely changed over the past couple of quarters. You're starting to see the opening of the faucet in terms of preclinical funds, which we knew they could not keep compressed for a long period of time. They need to keep feeding that innovation engine. And then even on top of that, sort of, I would say, normal return to preclinical spending, we're starting to see some incremental tailwinds from some of the AI momentum.

Mike Padoll, Analyst — Morgan Stanley

So, certainly in the last year, we've seen a meaningful amount of M&A and consolidation, especially involving large kind of flow cytometry and antibody portfolios. You all have indicated that flow represents roughly 40% of Revity's reagent business. What comprises the remainder of that portfolio, and how should investors think about why that's attractive?

Max Krakowiak, CFO

Yes, I think, as you mentioned, the reagents portfolio, we have two main pieces of it. You have the RUO flow cytometry, and then you have what we call sort of our research reagents and non-flow content. It's roughly about another 40%, 45% of the portfolio. And actually, that piece of the portfolio has been growing above our overall reagents performance over the past couple of years. And what our research reagents portfolio is, it really allows scientists to basically screen and validate their drug candidates against a known number of targets. and seeing how they interact at the cellular level. And so for us, we've seen a very strong talent over there the past couple of years. There's really two big players in the marketplace. It's us and then a privately owned company called ProMega. We both have market leadership positions. And so I think when you look at what's maybe driven some of that outperformance in the past couple of years, it's actually been around looking at different applications for sort of new therapeutic areas, so things like GLP-1s. And then I think as you look over, you know, the next sort of short to medium term here, it's also a portfolio that's very well positioned for what's needed from pharma companies' perspective around data generation for their AI models and that ability to, again, take an AI-developed candidate and screen it against a number of targets to see what that interaction is and generate that data to feed back into your AI models. You know, again, this portfolio is very well positioned to take advantage of that momentum.

Mike Padoll, Analyst — Morgan Stanley

And, you know, your commentary around the AI-related demand on the second quarter earnings call, you know, was strong, but that there was a benefit that was not necessarily readily apparent yet. Can you talk a little bit about what you're seeing in terms of actual kind of customer behavior that gives you confidence that AI is becoming a tangible demand driver for Revity?

Max Krakowiak, CFO

Yeah, so I think first we're seeing it in the order trend. and, again, I think that's the most tangible proof point I'll probably have for you today is the orders are coming in, and now it's just an ability for us to go and execute against them. I think when you then look at some of maybe the softer indicators, you know, it's in a lot of the conversations we're having in customers is around this narrative of, you know, lab in the loop and sort of how do we get maximizing our ability to take our preclinical research and maximize the data output, and you can just tell based on the customer conversations that, one, there is real momentum and they're setting up their infrastructure to take advantage of these new tools. But then secondly, the discussion around much larger projects, longer-term projects. We talked about the bulk orders we're seeing from a reagent standpoint, and that's really giving us a strong indication that we are starting to see sort of a loosening of the budgets on the preclinical side from pharma.

Mike Padoll, Analyst — Morgan Stanley

Can you talk a little bit more about, you mentioned the backlog. How should someone think about this incredibly strong backlog that you've seen within the context of, you know, the overall life sciences growth within the business?

Max Krakowiak, CFO

Yeah, so obviously the backlog hasn't quite shown up in the growth numbers yet. I think we did take up our second half forecast for our life sciences solutions business to account for the stronger backlog, both on the instrument side as well as with the reagents business. And I think for us, again, as we mentioned, you know, it was a nice increase in the order demand, which is from a supply chain perspective.

Mike Padoll, Analyst — Morgan Stanley

You've talked about how you believe there's likely to be a bottleneck in validation-related work in the future. What exactly do you mean by that? How should investors think about it? And, you know, where have the bottlenecks been in the past in kind of the preclinical discovery and development work?

Max Krakowiak, CFO

Yeah, so we actually probably started talking about this sort of validation bottleneck at the beginning part of 2026. And now that's sort of a little bit transformed into sort of this lab-in-the-loop narrative that you heard a lot about and what I previously mentioned. I think when we referred to the validation bottleneck, the example there is the way to think about it is AI is going to help pharma companies develop and design these compounds at a much faster rate. However, you still need to go into the wet lab and test those AI-developed molecules and compounds. And what you're also going to do is you're going to be creating more compounds than you can possibly put through the infrastructure right now. And so you're going to create this validation bottleneck of these AI design compounds and the wet lab work needed, again, to validate and screen them against a number of targets and see how they interact. And so that's what we were really referring to in terms of the sort of validation bottleneck, where it's evolved into that lab in the loop is sort of that sort of constant infinity loop of design your molecule and compound, validate it in the wet lab, and then put that back into your AI model, tweak it, and you get the sort of iterative loop before you ultimately get your compound into the clinic. And so that's really sort of, again, a lot of what we're hearing from the customers. It was a lot of what we started to hear and see in the beginning of 2026, and it's really continued to play out here over the first couple quarters.

Mike Padoll, Analyst — Morgan Stanley

So your Signal software business is obviously an incredibly important part of all of this. Maybe for an investor who's not a research scientist, Can you explain or just kind of give the context of how Signals fits into the overall workflow of your customers kind of end-to-end and what's unique about it relative to some of the other offerings in the space?

Max Krakowiak, CFO

Yeah, so probably the easiest way to think about our Signals franchise is it's an ERP for preclinical scientists. And so what you're able to do in our product suite is, one, you're able to sort of, again, design and draw your chemical compound. You're then able to build and document your experiment. And then we've got an analytical layer that sits on top of it to help you analyze the results from that experiment. It really is their ERP, which is what drives their workflows and operations on a day-to-day basis on the preclinical research side. And so for us, where we've now sort of continued to pivot the portfolio is figuring out how we take that sort of that infrastructure we have from a signals perspective and layering on top of it sort of where the market is going with these AI models and being able to have those AI models sit very closely to their preclinical research.

Mike Padoll, Analyst — Morgan Stanley

And so maybe say a little bit more about that. Why does AI strengthen the signals business as opposed to bypassing it or circumventing Yeah, I think there was a lot of noise about the whole SaaS apocalypse, which I think has been subdued now since it first came out.

Max Krakowiak, CFO

I think that's pretty similar for how folks initially thought about it from a signals perspective for us is big fear of it being overtaken by AI. But that's really not going to be the case. I mean, again, when you think about what our signals franchise is, it is the ERP for the scientists. It is their sort of their regulatory or their system of record from a preclinical standpoint, which is critical for them as they think about expediting their process from a clinical and regulatory submission standpoint. And so in that regard, it wasn't really something that I think was ever really in scope to be overtaken, quote, unquote, by sort of this AI narrative. It's really going to be much more of a complement and even a potential tailwind for our business. And I think what we've come out with is our product called Synthetica. And essentially what Synthetica is, is it's the infrastructure and a marketplace to host your AI models. And it'll sit very closely to all the preclinical data you have and creating that link between the two so that scientists are not operating, you know, on 15 different systems. Rather, they're in the signals notebook. They've got their AI models there tied in, again, to what they need from a regulatory perspective with the signals notebook. Right.

Mike Padoll, Analyst — Morgan Stanley

I think you said before, or historically, that Signals is a business that you expect to double over the next four or five years. Walk us through kind of what you would need or how you see that progressing. Is it expansion with existing customers, new customers, pricing, like some combination of all the above, something else? What's the right way to think about that?

Max Krakowiak, CFO

Yeah, I think you mentioned it, but we are very excited about the Signal franchise. We do anticipate our ability to double it over the next four to five years. I think when you look at sort of the growth algorithm for that business, again, 9% to 11% was what we have right now, and it's LRP. It's been growing above that. I think when you look at where it's going to go in the future, you've got about 106%, 107% is sort of our baseline net retention when a contract comes up for renewal. So you can almost kind of assume that as sort of the market growth rate for where we play. And then how we get to the 9-11 is really two factors. One, increasing sort of our breadth of customer base. We've talked about in the past how we are predominantly focused on Tier 1 pharma. We have an ability to continue to move further downstream into Tier 2, 2, 3, and even some of the smaller biotechs. We've recently launched some products that are perfectly positioned for some of those smaller biotechs, which we previously didn't have. And the second big sort of driver from a customer perspective is around material science. And so this is a new customer group for us. It uses very similar workflows and capabilities that we offer on the pharma side, and that's been growing significantly, I would say, over the past couple years and one that we think has a lot of room to run just given how fragmented that market is. The second, I would say, additional above-market growth rate lever we have in our signals business is around our new product launches and whether that's around, you know, biodesign and us expanding what we offer from a large molecule capability standpoint or around logistics and partnering with our customers and how they run their labs. And then I also talked about, you know, Synthetica that we have from an AI marketplace perspective.

Mike Padoll, Analyst — Morgan Stanley

Maybe shifting gears, you know, you've obviously announced a divestiture of the China-focused immunodiagnostics business. can you give folks a sense of that maybe aren't as familiar with that, how you came to that decision and the kind of timeline between now and when you expect that to close, what are some of the risks to that, recognizing that any separation is always going to have complexities and challenges so how should investors think about the separation in the context of the broader diagnostics business and kind of what it does on a pro forma basis for remedy.

Max Krakowiak, CFO

Yeah. Look, I think, again, we're incredibly excited about the ability for us to divest our immunodiagnostics I think it was really a culmination of external factors that were outside of our control that really drove us to the decision to divest that business. As you mentioned, it's going to complete here or execute by the end of 2027. I don't know that I would necessarily call it any specific risk associated with it. We've talked about the fact that they've got to fully localize their manufacturing. We've talked about the fact that we have to roll over the regulatory approvals to the new entity. And it's just a matter of, I would say, execution at this point. Thankfully, or lucky for us, we really just run a very similar play when we divested the legacy Perkin Elmer. And so we've got a pretty strong playbook of what needs to happen from a sort of execution perspective. It's really just the longest pull in the tent is the regulatory approvals. The benefit for us is we've at least already been selling these products in the market, so it's just paperwork at this point in time. But that is really, I would say, more the longest pull in the tent, but nothing really to call it from an execution risk perspective.

Mike Padoll, Analyst — Morgan Stanley

And how did you think about the decision to retain minority interest in that business? Why is that kind of the right answer? And what kind of rights or future economic participation do you all retain? Yeah, I think it was actually a critical piece of the deal for us.

Max Krakowiak, CFO

It was a critical piece for us for two reasons. One, just, again, given the uncertainty in the external market, it was a little bit of an unknown how all these future policies are going to change or play out over the next several years. And for us to maintain that minority stake, we've got the opportunity, I would say, to take advantage of upside if that business is able to sort of exceed expectations and sort of take off as a fully localized company. The second reason is, you know, we did want to keep a close connection with them. We actually have commercial rights of first refusal for any product they make in China that they want to distribute outside of China, which, again, was a key component for us. We obviously don't want to be creating a competitor for ourselves outside of China. And, look, they are really good from a scientific expertise and innovation standpoint. And so I think those two components, again, were really important for us as we got this deal done. Okay.

Mike Padoll, Analyst — Morgan Stanley

Can you talk a little bit about the reproductive health side of the diagnostics business? First of all, what it is and why you've seen so much strength in 2026 and just how you think about the outlook for that business going forward.

Max Krakowiak, CFO

Yes. I was at a reproductive franchise, not even just in 2026, but over the past several years has performed incredibly well despite despite declining birth rates. And I think when you look at our reproductive health franchise, there's probably really two main components that we mostly talk about. One is the newborn screening business, which is about 70% overall reproductive health business. And then you have our omics business, which is our, you know, global lab network. And so when you look at what's really been driving the strength of the performance, again, on the newborn screening side, again, declining birth rates. However, you know, there's still 100 million babies born around the world that don't get any level of testing. You've got different level of either state or country level testing, even for those that do have screening programs. And so the ability to get a state or a country to add one more marker to their menu. And then we also continue to come out with new assays that, you know, allow us to test for things that wasn't possible before. And so I think it's that really sort of three-pronged attack on the newborn screening side that has allowed us to grow above the declining birth rates. And then we've got our Omics franchise. And I think, you know, we've talked a lot about why we're excited about this OMICS lab network and what it can mean for us in the future, really as it relates to sort of either one, larger genomic screening programs that we can partner with, again, states or countries. We've talked about GEL, which has provided a nice tailwind here for us in 26, and there's much more discussions about either expanding that program but also starting new ones with other countries. And then the second thing is it is something that's going to allow us, I would say, to get our foot in from a companion diagnostics perspective. And, you know, we've talked about type 1 diabetes as sort of the first example of that, but our own mix business is really sort of that glue that takes our expertise from the diagnostic assay standpoint and the partnership with pharma companies to be able to play a much bigger role as sort of a companion diagnostics partner.

Mike Padoll, Analyst — Morgan Stanley

And how should investors think about, you know, the growth or what you expect, you know, from a performance standpoint in the back half of this year as opposed to kind of the longer-term vision?

Max Krakowiak, CFO

Yeah, so I think first half this year, reproductive health will be up double digits from a growth perspective, which, again, is really strong performance. I think as you look at the back half, we do expect that to moderate a bit, probably closer to low single digits. And I think really it's a function of two things. One, you get the Genomics England comp coming back in the second half of this year, so the contribution from Genomics England is less. And then, two, we did have some instrument placement timings in the first half of this year that helped our growth rate. But from an overall year perspective, you know, our reproductive health business can be growing, you know, high single digits, which is above its LRP of 2% to 4%. And, again, I think even in the past and probably looking forward, we do expect this business to be able to grow north of that 2% to 4% sort of watermark.

Mike Padoll, Analyst — Morgan Stanley

Got it. I believe you've talked about, you know, in the immunodiagnostics business, the ability to kind of grow high single digits this year. Do you still believe that to be the case?

Max Krakowiak, CFO

Yeah, high single digits is what's implied in our guidance this year. Again, I think if you even look at that business, that's high single-digit growth with a couple hundred basis points of headwind related to our TB testing franchise. And we've talked about some of the headwinds we have there, both from a market perspective but also our portfolio and the fact that we need to get out of new levels of automation to really be more competitive in the U.S. TB market, which is the largest market. But, again, immunodiagnostics has shown very strong performance in the first half, and I would argue that it's been that way for the past couple of years.

Mike Padoll, Analyst — Morgan Stanley

Can you say a little bit more about, you know, the historical trend relative to now, relative to kind of where you see that going in the more, you know, near term?

Max Krakowiak, CFO

Yeah, so I think when you look at our immunodiagnostics business, again, LRP is 9% to 11% growth. You know, the biggest underlying piece of that is actually we are playing in inherently faster-growing markets. So the markets that we plan out of autoimmune and allergy, even TB, or growing mid to high single digits in a normal year. And so that's a really strong baseline to be starting from. We've been able to grow several hundred basis points above that historically and what we expect going forward for, like, two main reasons. One, we still have a huge opportunity from a U.S. expansion standpoint. You know, for us, our U.S. revenues is about 15% to 20% of our immunodiagnostics revenue today. 40% of the market is in the U.S. It's the same players that we compete with outside the U.S. And so for us, it's really just continuing to drive further adoption and managing registrations in the U.S. to be able to get that closer to market. So that's one really big, I would say, growth tailwind for us. The second one is we continue to be, I would say, on the cutting edge of innovation. You know, when you look at what's needed from an autoimmune and allergy perspective, you need a really broad menu. You need one that's highly sensitive and highly specific. Oftentimes you're trying to figure out, you know, or find a needle in the haystack, if you will. And so that ability to have a very wide menu that's very specific is incredibly important for our customers.

Mike Padoll, Analyst — Morgan Stanley

Can you talk a little bit about the underlying markets? I mean, you mentioned it briefly, but what is driving that growth? How should investors think about that? Because it's a lot different relative to some of the other areas of diagnostics that you hear about.

Max Krakowiak, CFO

Yeah, I mean, I think when you look at it from a market standpoint, But one, it's probably one of the more, I would say, younger, less mature diagnostics markets. Oftentimes, these are not like mass population diseases that you are dealing with, right? These tend to be a little bit more nuanced, a little bit more specific. You've got patients that have symptoms that there's no clear indication of what's really driving those causes. And so you can even have, you know, multiple levels of testing trying to diagnose, again, the same symptom that they are facing. And so I think it's just really a matter of what you're testing that really drives that sort of stronger market growth rate.

Mike Padoll, Analyst — Morgan Stanley

Maybe shifting gears again, what are you most excited about from a financial perspective as it pertains to Revity? And what do you think investors most underappreciate about Revity and kind of the transformation that the business has gone through?

Max Krakowiak, CFO

Yeah, I mean, I mentioned at the beginning some of the, again, and the financial profile benefits we've had as part of the transformation, I still think the piece that's maybe most underappreciated, and look, we haven't really had the chance to show it, is really around the margin profile. And I think when you look at it again, our LRP in a normal market environment, we believe growing 6% to 8% organically, we should be able to expand our operating margin 75 basis points. In a couple of years, we haven't really had normal market environments. And so from that regard, we haven't really gotten the ability to show, So I would say the power of our new portfolio and the strength of our incremental margins, if you look at the fastest-growing area of our portfolio, whether it be software, life sciences, reagents, immunodiagnostics, newborn screening, those businesses have inherently higher gross margins and much stronger incrementals. And we believe that we are a company that should be delivering north of 40% incrementals, and then we don't really need to add new feet on the street. Again, if you think of those markets that I just talked about in terms of the fastest-growing areas, Because most of life science reagents is purchased through e-commerce. And if you look at signals in our diagnostics reagents, it's like account management. You don't need to be adding more feet on the street to drive incremental growth. And so I think the combination of those two things should enable us to deliver what I would consider best in sort of the industry from an incremental margin perspective.

Mike Padoll, Analyst — Morgan Stanley

We just haven't had the chance to show it yet, given some of the market headwinds. Got it. And how should investors think about the margin targets, whether it's from kind of 2027 or beyond?

Max Krakowiak, CFO

Yeah, I think if you look first specifically at 2027, I would say it should be somewhat of an outsized year from a margin expansion standpoint, depending upon our level of organic growth that we ultimately land on for 2027. And the reason is because we've got a bunch of cost-out actions that have been executed sort of at the tail end of the second quarter and the second half this year, and those cost actions will have an annualized benefit for us in the first half of 2027. And so that should provide us, I would say, a tailwinds above what we would normally expect from a margin expansion standpoint. I think as you look longer term, I think we've been pretty blunt in saying that we expect our business entitlement to sort of be mid-30s operating margin. And I think that's something that we're very much still believing and we're excited about to show once we again sort of get back to these more normal market environments on the life sciences side.

Mike Padoll, Analyst — Morgan Stanley

I know you all have paid down some debt recently that's brought your kind of overall leverage levels down. How should investors think about your capital allocation and capital deployment priorities?

Max Krakowiak, CFO

I mean, I think if you look over the last couple of years, we've been much more, I would say, balanced from a capital allocation standpoint versus historically. You know, we were almost 100% only in organic capital deployment. I think if you look at the last couple of years, we've bought back nearly 15% of shares outstanding. From a buyback perspective, obviously that was opportunistic with where the market was. And I think as you look going forward, I think you'll continue to see us both balanced and disciplined from a capital allocation standpoint. You know, obviously we'll see what happens from a public market perspective. We have announced some tuck-in deals over the past couple quarters here. And so I think, again, as you look over the next couple quarters, we'll see what happens from a public markets perspective. and we'll also see what's happening from an M&A pipeline perspective. But I will say that we have a much higher hurdle rate, I would say, for deals than we did in the past. We really like the financial profile we've created as a company. We really like sort of our market positioning we have in each one of our business units. And so for us, there's just a much higher bar for us.

Mike Padoll, Analyst — Morgan Stanley

So you have an investor day coming up in a couple of months on November 13th. Presumably, you know, AI is going to be a big focus there. But what else, you know, are you thinking about? Anything you want to preview? I don't want to front run it too much.

Max Krakowiak, CFO

But, yes, AI will be discussed. I think we'll have a specific focus on our signals business and really allowing folks to understand what we do there from a product perspective but also, again, why we're so excited about its future. And then we'll have sort of, you know, normal, what I'll call a corporate update. But we're very excited about the event. I look forward to seeing a lot of you guys out there.

Mike Padoll, Analyst — Morgan Stanley

And maybe one last question. You obviously have spent a lot of time with investors, you know, on the conference circuit and otherwise. What's one thing that you wish more investors understood about the business that they don't today?

Max Krakowiak, CFO

Understanding, I think it's probably still related to the signals business. Again, I think it's just because not many in our industry have a pure play software business like we do, which is, again, why I think a lot of the theme of that investor day will be on the signals franchise to really educate folks. I'd say that's probably the one aspect.

Mike Padoll, Analyst — Morgan Stanley

Thank you very much for joining us. It's been a pleasure to have you. Yeah, thanks for having me.