Welcome to the Fourth Quarter and Full Year 2023 Stryker Earnings Call. My name is Luke, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Following the conference, we will conduct a question-and-answer session. This conference call is being recorded for replay purposes. Before we begin, I'd like to remind you that discussions during this conference call will include forward-looking statements. Factors that could cause actual results to differ materially are discussed in the company's most recent filings with the SEC. Also, the discussions will include certain non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures can be found in today's press release that is an exhibit to Stryker's current report on Form 8-K filed today with the SEC. I'd now like to turn the call over to Mr. Kevin Lobo, Chair and Chief Executive Officer. You may proceed, sir.

Welcome to Stryker's fourth quarter earnings call. Joining me today are Glenn Boehnlein, Stryker's CFO; and Jason Beach, Vice President of Investor Relations. For today's call, I'll provide opening comments, followed by Jason with the trends we saw during the quarter, MAKO performance insights, and updates on recent acquisitions. Glenn will then provide additional details regarding our quarterly results and 2024 guidance before opening the call to Q&A. First, I want to recognize and celebrate our achievement of surpassing $20 billion in sales. We continue to be a high-growth company with a focus on our mission to deliver for our patients and customers. As we begin 2024, I am very excited about our future. We are in a strong position with robust demand across both procedures and capital, easing macro constraints, and a strong pipeline of innovation. I want to thank our over 50,000 employees for their unrelenting determination, agility, and performance. We've delivered terrific sales growth of over 11% in Q4 and the full year despite strong comparatives from the prior year. Our commercial execution, including many successful product introductions, was excellent across our businesses and regions. Globally, for both Q4 and the full year, we had double-digit organic sales growth in instruments, endoscopy, medical, neuro cranial, hips, knees, and trauma and extremities. For the full year, we also had double-digit organic sales growth both in the U.S. and internationally. Spine and neurovascular also demonstrated good performances while making notable advancements in future innovations and acquisitions. It was a comprehensive performance across our businesses, and we have built significant momentum entering 2024. For the sixth straight year, our international sales growth, excluding China VBP, outpaced our strong U.S. business. Canada, Australia, and most emerging markets had double-digit growth, while Europe and Japan grew in high single digits. International continues to be a large growth opportunity for us. Next, we delivered quarterly and full-year adjusted EPS of $3.46 and $10.60, respectively, which represents 15% growth for Q4 and 13% growth compared to the full year of 2022. This was driven by our strong sales but also demonstrates our continued operating margin recovery. We remain focused on driving high growth now and in the future through investments in organic innovation and M&A. We expect to continue to deliver sales growth at the high end of medtech, which is reflected in our full-year 2024 guidance of organic sales growth of 7.5% to 9%. This growth, combined with an accelerated margin expansion plan, translates to an adjusted EPS of $11.70 to $12 per share. I will now turn the call over to Jason.

Thanks, Kevin. My comments today will focus on providing an update on the current environment as well as MAKO, Vocera, and our recently announced agreement to acquire SERF. During the quarter, we saw strong procedural demand. We continue to expect the ortho markets will remain strong in 2024, driven by continued adoption in robotic-assisted surgery, demographics, a more favorable pricing environment, and healthy patient activity levels with surgeons. While supply constraints continue in pockets around the globe, our supply is stable overall and gradually improving. Additionally, demand for our capital products remained very robust in the quarter with double-digit organic growth in medical, instruments, and endoscopy. Hospital CapEx budgets remain healthy, and our capital order book remains elevated as we enter 2024. Next, specific to MAKO, we had a record quarter of installations globally. The progress of our MAKO offense, including our recent direct-to-consumer campaign, has resulted in strong growth of our installed base alongside continued increases in utilization. In the U.S., we saw 60% of knees and 34% of hips performed using MAKO as we exited the year. Globally, we exited the year with just over 40% of knees and nearing 20% of hips performed using MAKO. We have momentum, and a significant opportunity remains as MAKO adoption increases. We are nearing the two-year anniversary of our Vocera acquisition and remain very excited about the acquired assets, as they provide a platform for us to be at the intersection of medical devices, software, and clinical support. With integration activities now complete, which included a migration towards the cloud as well as the commercial reorganization, we are pleased with the accelerating double-digit sales and order growth achieved as we exited the year. In 2023, we saw many cross-sell wins, including new bed business leveraging Vocera. Also, we completed the seamless experience created between the Vocera platform and both ProCuity and our new wireless structure. This year and beyond will bring even more integrations and enhancements with a focus on scalability, user experience, automated workflow, and documentation. We expect strong double-digit annual sales growth to continue for years to come, and we are excited to have Vocera as part of the Stryker family. Lastly, we are progressing with our recently announced agreement to acquire SERF, and we expect the deal will close this quarter. With that, I will now turn the call over to Glenn.

Thanks, Jason. Today, I will focus my comments on our fourth quarter financial results and the related drivers. Our detailed financial results have been provided in today's press release. Our organic sales growth was 11.4% in the quarter, compared to 13.2% organic growth in the fourth quarter of 2022. The fourth quarter of 2023 has the same number of selling days as 2022. The impact from pricing in the quarter was favorable by 0.7%. We continue to see a positive trend from our pricing initiatives, particularly in our MedSurg and Neurotech businesses, all of which contributed positive pricing for the quarter. Foreign currency had a 0.3% favorable impact on sales in the quarter. In the quarter, U.S. organic sales growth was 12.7%. International organic sales growth was 7.7%, against a very strong comparable of over 18% in 2022. This performance included positive sales momentum across most of our international markets, particularly Australia, Canada, Japan, and most emerging markets. For the year, organic sales growth was 11.5%, with U.S. organic sales growth of 11.7% and international organic sales growth of 10.9%. Excluding the impact of China VBP, international growth was 12.8%. The impact for pricing in the year was favorable 0.6%. Foreign currency had a 0.5% unfavorable impact, and 2023 had the same number of selling days as 2022. Our adjusted EPS of $3.46 in the quarter was up 15.3% from 2022, driven by higher sales and operating margin expansion, as well as lower other income and expenses. Foreign currency exchange translation had a favorable impact of $0.02. Our full-year adjusted EPS was $10.60, which represents growth of 13.5% from full-year 2022, reflecting the favorable impact of sales growth and operating margin expansion, partially offset by the unfavorable impact of foreign currency exchange translation of $0.10. Now I will provide some highlights around our quarterly segment performance. In the quarter, MedSurg and Neurotechnology had constant currency sales growth of 12% and organic sales growth of 11.8%, which included 13.8% of U.S. organic growth and 5.7% of international growth. Instruments had U.S. organic sales growth of 11.5%, with strong double-digit growth across its Surgical Technology and Orthopedic Instruments businesses. From a product perspective, sales growth was led by power tools, SteriShield, smoke evacuation, and surgical accounts. Endoscopy had U.S. organic sales growth of 17.9%, with double-digit growth in its Communications, Endo, BEU, and Sports Medicine businesses. From a product perspective, this includes strong growth in booms, lights, and video. During the quarter, the Endoscopy business continued to see very strong momentum of the 1788 camera system, which had its full launch in September. Medical had U.S. organic sales growth of 12.9%, led by performances in its Vocera, Acute Care, and Sage businesses. This included strong growth in Vocera badges, beds, stretchers, and Prevalon repositioning products. All of this was against a very strong comparable growth of over 20% in 2022. Neurovascular had U.S. organic sales growth of 7.6%, reflecting solid performance in our hemorrhagic business. Neurocranial had U.S. organic sales growth of 14%, which included double-digit growth in the neurosurgical and ENT businesses, with strong growth in high-speed drill and balloon dilation products. Internationally, MedSurg and Neurotechnology had organic sales growth of 5.7%, reflecting double-digit growth in our instruments and neurocranial businesses. Geographically, this included strong performances in Australia, Canada, and Japan. Orthopedics and Spine had constant currency and organic sales growth of 10.7%, which included organic growth of 10.9% in the U.S. and 10.1% internationally. Our U.S. Knee business grew 12.9% organically, which reflects our market-leading position in robotic-assisted knee procedures. Our U.S. Hip business also grew 12.9% organically, reflecting solid primary hip growth fueled by our Insignia Hip Stem. Our U.S. Trauma and Extremities business grew 12.1% organically, with strong performances across all of its businesses, including Upper Extremities, Biologics, Core Trauma, and Foot and Ankle. Our U.S. Spine business grew 6%, led by the performance in our Enabling Technology and Interventional Spine businesses. Internationally, Orthopedics and Spine grew 10.1% organically, including strong performances in Canada and most emerging markets, particularly driven by Mako and strong Knee performance across most geographies. Now I will focus on operating highlights in the fourth quarter. Our adjusted gross margin of 63.9% was approximately 120 basis points favorable from the fourth quarter of 2022. This improvement was primarily driven by the continued easing of certain cost pressures, including the elimination of spot buy purchases that we experienced in 2022, and the continued benefit of pricing initiatives. Adjusted R&D spending was 5.6% of sales, which was 10 basis points higher than the fourth quarter of 2022. Our adjusted SG&A was 31% of sales, which was 40 basis points higher than the fourth quarter of 2022 due to continued investments, including sales growth incentives and a more normalized cadence of travel and meetings. In summary, for the fourth quarter, our adjusted operating margin was 27.2% of sales, which was approximately 60 basis points favorable to the fourth quarter of 2022. For the full year, our adjusted operating margin was 24.2% of sales, a 40 basis points increase over 2022. This performance is mainly driven by the easing of certain gross margin cost pressures throughout the second half of the year, as well as the positive impact of our pricing actions. Adjusted other income and expense of $31 million for the quarter was $23 million lower than 2022, mainly driven by higher interest income and other favorable discrete items. For 2024, we expect our full year other income and expense to be approximately $250 million. Our fourth quarter and full year had an adjusted effective tax rate of 14.6% and 14.1%, respectively, reflecting the impact of geographic mix and certain discrete tax items. For 2024, we expect our full year effective tax rate to be in the range of 14% to 15%. Focusing on the balance sheet, we ended the year with $3 billion of cash and marketable securities and total debt of $13 billion. During the year, we paid down the remaining $850 million outstanding on the $1.5 billion term loan associated with the Vocera acquisition and achieved our deleveraging commitments. In Q4, we also refinanced certain debt maturities, including pre-funding of $600 million that is due in May 2024. Turning to cash flow, our year-to-date cash from operations was $3.7 billion. This performance reflects the results of net earnings and higher accounts receivable collections. For 2024, we anticipate that capital spending will be $650 million to $700 million. We do not anticipate any share buybacks. And now I will provide 2024 full year sales and earnings guidance. Based on our momentum from 2023, strong procedural volumes, healthy demand for capital products, and a stabilizing macroeconomic environment, we expect organic sales growth to be in the range of 7.5% to 9% for 2024. There is one additional selling day in 2024 compared to 2023, with one less day in Q1 and one more day in both Q3 and Q4. Based on the steady progress of our pricing actions, we would expect the full year impact of price to be roughly flat. If foreign exchange rates hold near current levels, we anticipate sales will be modestly unfavorably impacted for the full year, being more negative in the first half of the year. EPS will be negatively impacted by $0.05 to $0.10. This is included in our guidance. Finally, for the full year 2024, we expect adjusted net earnings per diluted share to be in the range of $11.70 to $12, representing our commitment to accelerated operating margin expansion in 2024 as well as the stabilizing operating environment. While we do not provide quarterly guidance, we do expect seasonality for sales and related earnings to be similar to 2023, but adjusted for the quarterly differences in 2024 selling days.

At this time, we will open the floor for questions. Okay. Our first question comes from Robbie Marcus with JPMorgan. Your line is now open, please go ahead.

Great. Thanks and congrats on another fantastic quarter. Kevin, maybe to start, I feel like it's a bit of déjà vu, where we were sitting here at exactly this time last year and investors were starting to worry after a good year in 2022. And how good can 2023 be, and now people are wondering about 2024. So I was hoping you could give a little color behind the 7.5% to 9% organic sales growth. How much of that is transitory? How much of that is durable pricing? And any key drivers you could point us to? Thanks.

Yes. Thanks, Robbie. It certainly was a terrific year in 2023. We had 9.7% organic in the year before and over 11% organic in 2023. And frankly, we feel very good going into 2024. At some point, you think the comps will start to catch up a little bit. And so we think 7.5% to 9% is a strong guide. I can tell that coming off all of the domestic sales meetings, there is tremendous energy and excitement among our teams. The procedure volumes are strong. The capital markets are very strong. Hospitals are spending. We exited the year with more backlog than we began the year, which means, obviously, our orders are continuing to be strong for capital equipment. So we have a number of new launches, again, planned for 2024. Obviously, 2023 was a great year of capitalizing on product launches, whether it's System 9, whether it was Neptune S, whether it was the 1788. We have other launches coming again. So our pipeline of innovation is very strong. And I expect us to continue to grow at the high end of MedTech in a MedTech market that is quite healthy.

Great. Maybe, Glenn, a follow-up for you. And I appreciate you don't guide quarterly, but there's a lot you could do to help us get models in the right spot based on what you can say. And I guess, really the question is, my math is implying 50 to 100 basis points of operating margin expansion. You talked about the top line should look like 2023. And I imagine that looks like a normal comparable quarter in the first quarter and maybe some sharper seasonality than historically down 3Q up 4Q. Also, anything down the P&L operating margin that we should be considering in that seasonality? Thanks.

Yes. I think, Robbie – and I tried to sort of lay this out at the end of my guidance there, but I think a good place to start would be to look at sort of the cadence of sales and earnings in 2023. And really just adjust out for one selling day in Q1 and then adding two on the back end. And so as you look at Stryker, how are you going to deliver op margin expansion throughout the year, it's probably a little more back half loaded just based on the cadence that we'll see through the year for sales and related op income.

Thanks for taking the question. And I'll echo Robbie's congratulations on a really strong year and finish to the year. Kevin, I'd love to hear your updated thoughts on M&A headed into 2024. Your focus has been on paying down debt in 2023. Is your focus in 2024 on smaller deals? Are you open to considering something larger? And is the target area still the same as the ones you shared at the orthopedic meeting last year? And I had one follow-up.

Yes. Thanks, Larry. I would say that we're back on M&A offense now, what I'll call our normal M&A offense. And as you've seen in the past with Stryker that would typically mean larger volume of tuck-in deals. And those can be large, and they can also be small. During the pause, while we paid down debt, all of our BD teams worked very actively. Believe me, they have a long list of targets, and we are going to be active now that we've gotten our leverage back to where we'd like to be. So let's say we're back to the normal Stryker offense. Expect us to be doing deals. We are open to larger deals. But our history would tell you that the vast majority of our deals are going to be smaller tuck-ins, but we can do many deals versus being very limited last year.

Yes. Larry, I think, first of all, we're not backing off of our sprint to 2019 op margin at all. And we have clearly had a plan to get there by the end of 2025. As I said at Analyst Day, we have good opportunities in operating expenses and in gross margin. I think if you look at our delivery in 2023, we got about 80 basis points out of gross margin and we invested in some operating expenses that we had indicated would get back to sort of normalized spend. So my thoughts on 2024 is that expansion will generally be led by operating expenses, but there continue to be really good opportunities in gross margins that we continue to work on. And if you think about some of these things, price isn't going away from us. We're still going to continue to work on that. We have opportunities in purchasing and procurement, supplier consolidation. On the OpEx side, we'll continue to expand into shared services in some of these low-cost areas where we have those. And then honestly, from OpEx, we have a lot of natural leverage. It just comes when you're growing at the rate that we're growing.

Yes, thanks for taking the question. So I want to ask about orthopedics. It's just been stellar performance. And we've heard from you and one of your peers. And Kevin, I just would appreciate if you can kind of characterize the confidence that this continues to persist for 2024. And how are you improving or what are you doing to improve potentially productivity on the Mako unit to capture demand that's continuing to be so strong?

Yes. Thanks. We're delighted with the progress that we've made. 60% of U.S. Knees being done on the robot is pretty remarkable given how long ago we launched the Total Knee application and SNFs starting to really climb since we launched the 4.0 software has been terrific. Cementless continues to climb as well. And that tends to index much higher with the use of Mako. And as you know, we are clearly the leader in not just robot-assisted surgery, but clearly the leader in Cementless as well. So a lot of good things going on with a market that is obviously a little better than it has been historically. But Mako continues to be the engine of growth, and that's true in the hospital. That's true in the ASPs as well. And we're seeing continued growth in the ASP, where our Stryker offense is really winning at pretty spectacular rates as it relates to new builds and big renovations. So we have a lot of momentum across all of those dimensions, which translates to terrific performance as you saw with hips and knees. But the other part of our story is trauma extremities. So the right medical acquisition has been a complete home run of a deal. And you’re seeing that not only has it been great for our extremities business, but it enabled us to focus a lot more on our core trauma business. And we really had all of our businesses in trauma extremities humming as we exited the year. And some great product launches towards the end of the year and some more to come in 2024.

Great, thank you so much. Kevin, I was hoping to get your thoughts on utilization. It’s been a key topic this last week across some healthcare sectors. What trends are you seeing in healthcare utilization across different care settings? What is driving it and how do you think about the sustainability of it? Is it being driven by the aging demographics? Is it innovation? Is it just low market penetration? And I think you did indicate that there is still a backlog and it is contributing, but is it a meaningful contributor to growth on a year-over-year basis? And then I have a follow-up.

Okay. Well, I think if you look at the hospitals and what they’re saying, that’s kind of one of the indicators we look at. They’re busy, right? The hospitals are busy, patients, definitely aging demographics plays for Stryker’s portfolio that definitely plays to our advantage. And every day, 10,000 more people are turning 65. The activity levels are also increasing, right? The advent of Pickleball has been a terrific thing for our business. More active people who are elderly tend to want to stay active. And activity levels are kind of the biggest predictor of needing joint replacements and sports medicine procedures. So we’re seeing very good activity levels. And so I don’t really want to talk about backlog. I just think what we’re seeing is patients presenting, frankly, some patients who are just wanting to be more active, losing weight and then wanting to be more active and then being eligible for surgery. So we do see really good waiting lists for surgeries for surgeons in the orthopedic space, hospitals ordering capital, whether it’s small capital or large capital, building more ASCs. The ASC trend has actually really helped, because patients love it. They go, they get home the same day, they have a terrific experience, and they tell all their friends, and that word of mouth is spreading for hip and knees, absolutely, for hip and knee surgeries that is happening. And our percent of procedures in ASCs continues to climb. So I think those are the – there’s a number of factors I just outlined, all of them pointing to, at least for this year, continued good demand. And I don’t know how temporary it is. This could be continuing, frankly, for a period of time, because I think demographics and activity levels are the two drivers that we’re seeing, at least for our portfolio of businesses. Yes. Great question. First of all, we have a history that we generally like to follow, and I would tell you that it’s early days. We’re here in January looking at 2024, we feel very confident about where we’re going to perform on sales and driving off margin expansion. At this point, I’m not going to comment on the potential to go beyond that, but we feel very good about the guidance that we put out.

Hey, good afternoon and thanks for taking my questions and congrats on an amazing year. On the gross margins, can you help bridge the third quarter to fourth quarter gross margins? How much of the impact was mixed? And then you have the good guys and bad guys that can help us understand that sequential change?

Yes. Sure, Pito. Without going into too much detail, I would say, the single biggest item was really mix in terms of what was growing much faster in Q4 versus Q3 relative to sort of some of the other items. We also had really solid price performance in Q4, which contributed to that. And then lastly, sort of in typical Stryker fashion, we hit a little bit of a hockey stick here in Q4 too. And so that actually benefits up the gross margin line.

Hey, thanks for taking the question, Glenn. Maybe just a finer point on some of the op margin guide. It looks like the 200 basis points, more than half of that’s in 2024. Can you just confirm that there’s a little bit of kind of math going around? Just want to make sure we got the math in 2024 correct. And with such a big ramp in 2024 on the guidance, just can you give a little more confidence on what you’re doing to kind of achieve that 100 basis points plus in 2024? What you’re seeing on the cost input side, just to kind of drive confidence that that’s achievable in 2024?

Sure. Yes. I think you can do the math as well as I can, especially given all the areas that I’ve guided in the full year. So I definitely think you’re in the zip code for what we think will happen in 2024. And honestly, if we look at sort of what we’ve laid out and planned for the year, first of all, the natural leverage we get from growth versus fixed cost in operating expenses certainly will provide us some benefits. We also won’t stand still in a lot of the gross margin initiatives that I mentioned, and those will move forward and also provide some benefit that we’ll see in 2024. And so I would tell you that we haven’t walked lightly on this. I would say that across the globe, Stryker is very focused on these op margin expansion projects and sustainable op margin expansion for 2024 and 2025. And so we feel very confident that we’ll be able to deliver that.

Afternoon. Thanks for taking the questions. Just on MAKO, this question might be for Jason. Just the domestic number this quarter was a little bit soft, and we’re hearing about one of your competitors just giving their system away because it’s not all that great. Can you talk about the dynamics that you’re seeing in the market, especially domestically for MAKO in terms of placing systems, selling systems, and then just having to get really aggressive on the pricing side, just given the environment that you’re in? And then conversely, the OUS number looks phenomenal again. Just where are we at in terms of growing that business over the next several years? And I do have one follow-up.

Yes, I’ll start this and Kevin, feel free obviously to weigh in. But as we think about the MAKO offense, and I think we’ve said this previously as well. When we think about the various options to bring MAKO to market, we’ve been flexible, right, whether it’s leasing, rentals, et cetera. So I think we’re very competitive from that standpoint. And to your comment on kind of where we are, I would still say whether it’s U.S. or internationally, early innings here, we’ve got a lot of runway relative to MAKO. But as we think about the financing options, it’s not going to be an impediment for us to expand the MAKO footprint.

Yes. The only thing I would add to Jason’s comments is every ASC MAKO that’s installed is financed everyone, and that’s becoming a bigger percentage of the MAKO installation. So what you’re seeing is more financed rentals and financed versus outright capital purchases. So that obviously the revenue number and the revenue growth of 3 percentage or less is not the installation growth. The installation growth is higher than what you’re seeing. And over time, that’ll start to normalize and then you’ll start to see the growth rate be more reflective of the installation rate. But we’re going through this kind of transition phase right now, and we are giving them away. So we charge for it and we have different pricing models, obviously, and we want the customers to have skin in the game, so that if we just give it away, they have no incentive to use it. And what we don’t want are a bunch of robots collecting dust. So we care a lot and we monitor utilization of the robots very, very significantly. And then, of course, OUS we’re seeing terrific pickup and a lot more purchases than finance. We do offer financing around the world, but so far in international we’re seeing a lot more purchases than we are financing, which is why you see the revenue spike. But again, international has a huge potential. It’s kind of where we were in the U.S. about five years ago. Yes. What I’d say is, first of all, the MAKO brand is extremely well known. That’s a very, very big positive. And I think what you’re going to see is a much faster uptake than you would have seen had we not had already had MAKO on hips and knees. Will it take a little bit of time? Sure. Will a spine surgeon want to share the robot with hips and knee surgeons? Not sure yet. Obviously, that’s something we’re going to see play out, whether they’re going to want their own robot or they’re going to be willing to operate on the days that the hip and knee people aren’t operating. So that’s a whole dynamic. I think that’ll vary account by account. So we’re already working on our commercialization plans. I think part of the reason for our success is – success with the Q guidance, which is one half of the system.

Hi, good evening. Thanks for taking the questions. I wanted to, hopefully, Kevin, ask about just got a temperature check on the health care delivery systems capacity for orthopedic procedure growth. I think heading into 2023 after experiencing 2022, there were concerns around staffing shortages, et cetera, and potentially creating a bottleneck for procedure volume growth. That clearly didn’t play out in 2023. It doesn’t sound like from your comments, it’s going to play out. You expect it to play out in 2024. But are there any capacity constraint issues in the U.S. health care delivery system for orthopedic procedure volume growth as we go forward in 2024 and 2025 or is that fully in the rearview mirror?

Yes, I think it’s largely in the rearview mirror. There are still niggling things here and there, but it’s gotten very quiet. You saw that in Q4. It’s just a boom of a Q4. And kind of the normal seasonality, I think we now have finally a normalized year for you to compare is, of course, adjusted for selling days, but there is a normalized year finally. And yes, they’ve gotten their staffing issues solved largely, and they do prioritize orthopedics, because orthopedics is a moneymaker for hospitals, right? Cardiovascular and orthopedic procedures are two money makers. And so if they are short-staffed, they are going to prioritize staffing for orthopedics. I would say the only area that still has a lot of room to run is ASCs. So every hospital is constructing ASCs, and that’s going to continue to be an engine of future growth.

Yes, it’s Jason. When you think about the MAKO offense, and I think we’ve mentioned previously as well, we’ve been flexible in our approaches, whether it’s leasing, rentals, etc. So I think we’re really competitive from that standpoint. And to your comment on where we are, whether it’s U.S. or internationally, early innings. We’ve got a lot of runway.

Hi. Thanks for taking the questions, and congrats on a great quarter. Just jumping up on Matt's question earlier. Momentum in spine really seems to be strong. Do you have any more clarity on how much you've been able to capitalize on the disruption in the space or expect to kind of capitalize from the disruption?

Yes, I tell you. Listen, our performance thus far has really nothing to do with the disruption of the consolidation. It's just starting. We've just started to hear some disruption in Texas as an example and a couple of other little spots. So I would say very early days of disruption, and that's not the reason why we're doing better. We've really improved our offense in spine, especially as it relates to enabling tech. I think the Q guidance was a big shot in the arm for the spine business. They've done a terrific job selling that and, of course, leveraging that for implants.

I will now turn the call back over to Mr. Kevin Lobo for closing remarks.

Thank you all for joining our call. As you can see, we have terrific momentum as we finish the year. We're excited about 2024, and we look forward to sharing our first quarter results with you in April. Thank you.