[ { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Operator: Good day, everyone, and welcome to the Apple Q1 Fiscal Year 2023 Earnings Conference Call. Today 's call is being recorded. And now at this time, for opening remarks and introductions, I would like to turn the call over to Tejas Gala, Director of Investor Relations and Corporate Finance. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Tejas Gala: Thank you. Speaking first today is Apple 's CEO, Tim Cook; and he 'll be followed by CFO, Luca Maestri. After that, we 'll open the call to questions from analysts. Before turning the call over to Tim, I would like to remind everyone that the December quarter spanned 14 weeks, while the March quarter, as usual, has 13 weeks. Please note that some of the information you 'll hear during our discussion today will consist of forward - looking statements, including, without limitation, those regarding revenue, gross margin, operating expenses, other income and expense, taxes, capital allocation and future business outlook, including the potential impact of COVID-19 on the company 's business and results of operations. These statements involve risks and uncertainties that may cause actual results or trends to differ materially from our forecast. For more information, please refer to the risk factors discussed in Apple 's most recently filed annual report on Form 10 - K and the Form 8 - K filed with the SEC today, along with the associated press release. Apple assumes no obligation to update any forward - looking statements or information which speak as of their respective dates. I 'd now like to turn the call over to Tim for introductory remarks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Timothy Cook: Thank you, Tejas. Good afternoon, everyone, and thanks for joining us. Today, we 're reporting revenue of $117.2 billion for the December quarter. We set all - time revenue records in a number of markets, including Canada, Indonesia, Mexico, Spain, Turkey and Vietnam, along with quarterly records in Brazil and India. As a result of a challenging environment, our revenue was down 5% year - over - year. But I ' m proud of the way we have navigated circumstances, seen and unforeseen, over the past several years, and I remain incredibly confident in our team and our mission and in the work we do every day. Let me discuss the 3 factors that impacted our revenue performance during the quarter. The first was foreign exchange headwinds, which had a nearly 800 basis point impact. On a constant currency basis, we grew year - over - year and would have grown in the vast majority of the markets we track. The second factor, which we described in a November 6 update was COVID-19 - related challenges, which significantly impacted the supply of iPhone 14 Pro and iPhone 14 Pro Max and lasted through most of December. Because of these constraints, we had significantly less iPhone 14 Pro and iPhone 14 Pro Max supply than we planned, causing ship times to extend far beyond what we had anticipated. As we always have every step of the way throughout the pandemic, we continued to prioritize people and worked with our suppliers to ensure the health and safety of every worker. Production is now back where we want it to be. The third factor was a challenging macroeconomic environment as the world continues to face unprecedented circumstances, from inflation to war in Eastern Europe, to the enduring impacts of the pandemic. And we know that Apple is not immune to it. But whatever conditions we face, our approach is always the same. We are thoughtful and deliberate. We manage for the long term. We adapt quickly to circumstances outside our control while delivering with excellence in the things we can. We invest in innovation, in people and in the positive difference we can make in the world. And we do it all to provide our customers with technology that will enrich their lives and help unlock their full creative potential. It 's a wonderful thing to be a part of, and it 's so rewarding for all of us at Apple when we hear how much our customers are loving what we create. Let me talk now about what we saw across our product categories. Starting with iPhone. Revenue came in at $65.8 billion for the quarter, down 8% year - over - year. However, on a constant currency basis, iPhone revenue was roughly flat. Our customers continue to rave about the astounding camera capabilities and unprecedented battery life and the groundbreaking suite of health and safety features. The iPhone 14 lineup pushes the limits of what users can do with a smartphone. During the quarter, Mac revenue came in at $7.7 billion, which was in line with what we had expected. We had a difficult compare because this time last year, we had the extremely successful launch of the redesigned M1 MacBook Pros. We also faced a challenging macroeconomic environment and foreign exchange headwinds. We remain confident in and focused on the long - term opportunity for Mac. Just last month, we introduced new MacBook Pro models powered by our latest developments in Apple silicon, M2 Pro and M2 Max. These chips enable unprecedented performance and do so with less energy, which is not only good for the environment but gives the newest MacBook Pro the longest battery life ever in a Mac. We also introduced the M2 - powered Mac mini, which will supercharge productivity for users of all kinds and leave them stunned by just how powerful a Mac mini can be. During the quarter, iPad revenue grew 30% to a total of $9.4 billion. The very strong growth was due in part to a favorable compare to the December quarter a year ago when we experienced significant supply constraints. Customers continue to praise our new lineup for its versatility, whether it 's the new iPad Pro now powered by the M2 or the newly designed iPad 10th Generation with its stunning liquid retina display and beautiful colors. Revenue for Wearables, Home and Accessories was $13.5 billion, which was down 8% year - over - year driven by foreign exchange headwinds and a challenging macroeconomic environment. We remain excited about the long - term opportunity in the category. As an example, a few weeks ago, we announced the next - generation HomePod, which is an indispensable addition to the smart home. This powerful smart speaker relies on advanced computational audio to produce an incredible listening experience. We 're also helping users make their homes safer with sound recognition. This feature, arriving later this spring, allows HomePod to send a notification directly to a user 's iPhone if a smoke or carbon monoxide alarm sound is identified. We continue to hear wide praise for Apple Watch Series 8 and Apple Watch Ultra, which has set a new standard for what 's possible with a wearable. From a whole host of health and safety features to incredible new capabilities for extreme athletes, there is something for everyone in these amazing products. Customers are excited about some phenomenal new features we ' ve made available across many of our products as well. One of the highlights is emergency SOS via satellite, which launched for iPhone 14 customers in the U.S. and Canada in November and for customers in France, Germany, Ireland and the U.K. in December. This is a feature we hope our users will never need, but it is incredibly heartening to get e - mails from people describing the life - saving impact our new safety features have had on them. We 're always looking for new ways to empower people to create and collaborate. In December, we released Freeform, a brand - new app that lets users take their ideas wherever they want, anywhere they are, all while collaborating in real time. Freeform has already received praise from reviewers for its flexibility and simplicity as it works seamlessly across iPhone, iPad and Mac. Today, we are very excited to announce that we ' ve achieved a truly incredible milestone. Thanks to our deep commitment to innovation, incredible customer loyalty and satisfaction and a large number of switchers, we now have more than 2 billion active devices as part of our growing installed base, double what it was just 7 years ago. This is an incredible testament to our products and services and the strength of our ecosystem. We set an all - time revenue record of $20.8 billion in services, which was better than what we had expected. We achieved double - digit revenue growth from App Store subscriptions and set all - time revenue records across a number of categories, including cloud and payment services. All told, Apple now has more than 935 million paid subscriptions. Apple has also just begun a historic 10 - year partnership with Major League Soccer. Just yesterday, we launched MLS Season Pass, which will give fans in more than 100 countries access to every live MLS regular season game as well as the playoffs and MLS Cup, all with no blackouts. And while we 're providing more content to sports fans than ever before, Apple TV+ continues to showcase powerful characters and moving storytelling. We were thrilled to celebrate the holidays alongside our Apple TV+ subscribers with the hit movie Spirited. And we 're delighted to see how much people are enjoying new and returning series like Shrinking, Slow Horses and Truth Be Told. And we have some great upcoming movies in Sharper and Tetris, along with Emmy Award winner Ted Lasso returning this spring. During the quarter, we made some great updates to Fitness+ as well, expanding our catalog of more than 3,500 workouts and meditations to include a new kickboxing category and a new sleep theme for meditations. Our latest artist spotlight series features the music of the incomparable Beyonce, and we 're excited to take a stroll with guests appearing on our fifth season of Time to Walk. And we continue to build on our decades - long commitment to helping small businesses thrive when we announced Apple Business Connect. This new tool gives business owners even more control over how billions of people see and engage with their products and services every day. Businesses of all sizes can now customize key information for users across Apple Maps, Messages, Wallet, Siri and other apps. Meanwhile, in retail, we celebrated 25 years of the Apple online store and also opened Apple Pacific Centre in Vancouver and Apple American Dream in New Jersey. And I ' m grateful to all the teams who helped our customers throughout the busy holiday season. At Apple, we spend a lot of time focused on creating an unparalleled experience for our customers and every product and service that we offer. We 're also just as dedicated to leading with our values in everything we do. As part of that work, we strengthened our deep commitment to privacy and security, giving users 3 new tools to protect their most sensitive data: iMessage contact key verification, security keys for Apple ID and advanced data protection for iCloud. At Apple, we feel a deep sense of responsibility to leave the world better than we found it. We 're also a year closer to 2030, and we were ever focused on the environmental commitments we set out for the end of the decade. As an example, the latest Mac mini and MacBook Pro models all use 100% recycled aluminum in the enclosure and recycled rare earth elements in all magnets. And in a first for HomePod, we 're using 100% recycled gold in the plating of multiple printed circuit boards. In honor of Black History Month, we released the Black Unity collection, including the Special Edition Apple Watch Black Unity Sport Loop, a new matching watch face and iPhone wallpaper. Through our racial, equity and justice initiative, we 're expanding our support of 5 organizations focused on lifting up communities of color through technology. And we are committed as ever to building on our progress around inclusion and diversity. During the quarter, we also announced that since the inception of our Giving program 11 years ago, we ' ve donated more than $880 million to humanitarian efforts, disaster relief, childhood education and more. And over the last 16 years through our partnership with (RED), Apple - supported grants have helped more than 11 million people get the care and support services they need. As we look ahead in 2023, we are excited about the year to come. At Apple, we are always looking forward, always focused on the next challenge, always determined to do great things with unmatched creativity and unrivaled innovation. And that makes me more confident about the future of Apple than I have ever been. With that, I 'll turn it over to Luca.", "ground_truth_output": { "entities": [ { "id": 0, "label": "Traditional", "start_offset": 102, "end_offset": 119, "text": "reporting revenue", "global_span": [ 1698, 1715 ] }, { "id": 1, "label": "Value", "start_offset": 123, "end_offset": 137, "text": "$117.2 billion", "global_span": [ 1719, 1733 ] }, { "id": 2, "label": "Traditional", "start_offset": 182, "end_offset": 189, "text": "revenue", "global_span": [ 1778, 1785 ] }, { "id": 3, "label": "Value", "start_offset": 190, "end_offset": 197, "text": "records", "global_span": [ 1786, 1793 ] }, { "id": 4, "label": "Traditional", "start_offset": 203, "end_offset": 220, "text": "number of markets", "global_span": [ 1799, 1816 ] }, { "id": 5, "label": "Traditional", "start_offset": 382, "end_offset": 389, "text": "revenue", "global_span": [ 1978, 1985 ] }, { "id": 6, "label": "Value", "start_offset": 394, "end_offset": 401, "text": "down 5%", "global_span": [ 1990, 1997 ] }, { "id": 7, "label": "Traditional", "start_offset": 402, "end_offset": 420, "text": "year - over - year", "global_span": [ 1998, 2016 ] }, { "id": 8, "label": "Traditional", "start_offset": 2489, "end_offset": 2504, "text": "iPhone. Revenue", "global_span": [ 4085, 4100 ] }, { "id": 9, "label": "Value", "start_offset": 2516, "end_offset": 2529, "text": "$65.8 billion", "global_span": [ 4112, 4125 ] }, { "id": 10, "label": "Traditional", "start_offset": 2538, "end_offset": 2545, "text": "quarter", "global_span": [ 4134, 4141 ] }, { "id": 11, "label": "Value", "start_offset": 2547, "end_offset": 2554, "text": "down 8%", "global_span": [ 4143, 4150 ] }, { "id": 12, "label": "Traditional", "start_offset": 2555, "end_offset": 2573, "text": "year - over - year", "global_span": [ 4151, 4169 ] }, { "id": 13, "label": "Traditional", "start_offset": 2911, "end_offset": 2922, "text": "Mac revenue", "global_span": [ 4507, 4518 ] }, { "id": 14, "label": "Value", "start_offset": 2934, "end_offset": 2946, "text": "$7.7 billion", "global_span": [ 4530, 4542 ] }, { "id": 15, "label": "Value", "start_offset": 3306, "end_offset": 3316, "text": "introduced", "global_span": [ 4902, 4912 ] }, { "id": 16, "label": "Traditional", "start_offset": 3317, "end_offset": 3347, "text": "new MacBook Pro models powered", "global_span": [ 4913, 4943 ] }, { "id": 17, "label": "Traditional", "start_offset": 3782, "end_offset": 3789, "text": "quarter", "global_span": [ 5378, 5385 ] }, { "id": 18, "label": "Traditional", "start_offset": 3791, "end_offset": 3808, "text": "iPad revenue grew", "global_span": [ 5387, 5404 ] }, { "id": 19, "label": "Value", "start_offset": 3809, "end_offset": 3812, "text": "30%", "global_span": [ 5405, 5408 ] }, { "id": 20, "label": "Value", "start_offset": 3827, "end_offset": 3839, "text": "$9.4 billion", "global_span": [ 5423, 5435 ] }, { "id": 21, "label": "Traditional", "start_offset": 4215, "end_offset": 4236, "text": "Revenue for Wearables", "global_span": [ 5811, 5832 ] }, { "id": 22, "label": "Traditional", "start_offset": 4238, "end_offset": 4258, "text": "Home and Accessories", "global_span": [ 5834, 5854 ] }, { "id": 23, "label": "Value", "start_offset": 4263, "end_offset": 4276, "text": "$13.5 billion", "global_span": [ 5859, 5872 ] }, { "id": 24, "label": "Value", "start_offset": 4288, "end_offset": 4295, "text": "down 8%", "global_span": [ 5884, 5891 ] }, { "id": 25, "label": "Traditional", "start_offset": 4296, "end_offset": 4314, "text": "year - over - year", "global_span": [ 5892, 5910 ] }, { "id": 26, "label": "Value", "start_offset": 5865, "end_offset": 5873, "text": "released", "global_span": [ 7461, 7469 ] }, { "id": 27, "label": "Non_Traditional", "start_offset": 5874, "end_offset": 5901, "text": "Freeform, a brand - new app", "global_span": [ 7470, 7497 ] }, { "id": 28, "label": "Value", "start_offset": 6389, "end_offset": 6398, "text": "2 billion", "global_span": [ 7985, 7994 ] }, { "id": 29, "label": "Non_Traditional", "start_offset": 6399, "end_offset": 6413, "text": "active devices", "global_span": [ 7995, 8009 ] }, { "id": 30, "label": "Traditional", "start_offset": 6609, "end_offset": 6623, "text": "revenue record", "global_span": [ 8205, 8219 ] }, { "id": 31, "label": "Value", "start_offset": 6627, "end_offset": 6640, "text": "$20.8 billion", "global_span": [ 8223, 8236 ] }, { "id": 32, "label": "Value", "start_offset": 6907, "end_offset": 6918, "text": "935 million", "global_span": [ 8503, 8514 ] }, { "id": 33, "label": "Traditional", "start_offset": 6919, "end_offset": 6937, "text": "paid subscriptions", "global_span": [ 8515, 8533 ] }, { "id": 34, "label": "Value", "start_offset": 6956, "end_offset": 6966, "text": "just begun", "global_span": [ 8552, 8562 ] }, { "id": 35, "label": "Non_Traditional", "start_offset": 6969, "end_offset": 6980, "text": "historic 10", "global_span": [ 8565, 8576 ] }, { "id": 36, "label": "Non_Traditional", "start_offset": 6983, "end_offset": 7024, "text": "year partnership with Major League Soccer", "global_span": [ 8579, 8620 ] }, { "id": 37, "label": "Value", "start_offset": 7045, "end_offset": 7053, "text": "launched", "global_span": [ 8641, 8649 ] }, { "id": 38, "label": "Non_Traditional", "start_offset": 7054, "end_offset": 7069, "text": "MLS Season Pass", "global_span": [ 8650, 8665 ] }, { "id": 39, "label": "Value", "start_offset": 7095, "end_offset": 7118, "text": "more than 100 countries", "global_span": [ 8691, 8714 ] }, { "id": 40, "label": "Traditional", "start_offset": 7119, "end_offset": 7163, "text": "access to every live MLS regular season game", "global_span": [ 8715, 8759 ] }, { "id": 41, "label": "Value", "start_offset": 8226, "end_offset": 8235, "text": "announced", "global_span": [ 9822, 9831 ] }, { "id": 42, "label": "Non_Traditional", "start_offset": 8236, "end_offset": 8258, "text": "Apple Business Connect", "global_span": [ 9832, 9854 ] }, { "id": 43, "label": "Traditional", "start_offset": 10296, "end_offset": 10303, "text": "donated", "global_span": [ 11892, 11899 ] }, { "id": 44, "label": "Value", "start_offset": 10304, "end_offset": 10326, "text": "more than $880 million", "global_span": [ 11900, 11922 ] }, { "id": 45, "label": "Traditional", "start_offset": 10330, "end_offset": 10350, "text": "humanitarian efforts", "global_span": [ 11926, 11946 ] }, { "id": 187, "label": "non_traditional", "text": "December", "start_offset": 5852, "end_offset": 5860, "global_span": [ 7448, 7456 ] } ], "relations": [ { "id": 1, "entity_ids": [ 0, 1 ], "description": "Value of" }, { "id": 2, "entity_ids": [ 2, 3, 4 ], "description": "Description_of\n" }, { "id": 3, "entity_ids": [ 5, 6, 7 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 8, 9, 10 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 8, 10, 11, 12 ], "description": "Value_of" }, { "id": 6, "entity_ids": [ 13, 14 ], "description": "Value_of" }, { "id": 7, "entity_ids": [ 15, 16 ], "description": "Value_of" }, { "id": 8, "entity_ids": [ 17, 18, 19 ], "description": "Value_of" }, { "id": 9, "entity_ids": [ 17, 20 ], "description": "Value_of" }, { "id": 10, "entity_ids": [ 21, 22, 23 ], "description": "Value_of" }, { "id": 11, "entity_ids": [ 21, 22, 24, 25 ], "description": "Value_of" }, { "id": 12, "entity_ids": [ 26, 27 ], "description": "Value_of" }, { "id": 13, "entity_ids": [ 28, 29 ], "description": "Value_of" }, { "id": 14, "entity_ids": [ 30, 31 ], "description": "Value_of" }, { "id": 15, "entity_ids": [ 32, 33 ], "description": "Value_of" }, { "id": 16, "entity_ids": [ 34, 35, 36 ], "description": "Value_of" }, { "id": 17, "entity_ids": [ 37, 38 ], "description": "Value_of" }, { "id": 18, "entity_ids": [ 39, 40 ], "description": "Value_of" }, { "id": 19, "entity_ids": [ 41, 42 ], "description": "Value_of" }, { "id": 20, "entity_ids": [ 43, 44, 45 ], "description": "Value_of" }, { "id": 82, "entity_ids": [ 0, 1 ], "description": "Value_of" }, { "id": 83, "entity_ids": [ 2, 3, 4 ], "description": "Value_of" }, { "id": 84, "entity_ids": [ 5, 6, 7 ], "description": "Value_of" }, { "id": 85, "entity_ids": [ 26, 27, 187 ], "description": "Value_of" } ] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Luca Maestri: Thank you, Tim, and good afternoon, everyone. As Tim mentioned, revenue for the December quarter was $117.2 billion, down 5% from last year. A number of factors had a significant impact on our results. First, we faced a very difficult foreign exchange environment, which affected our performance by nearly 800 basis points. In other words, we grew revenue on a constant currency basis. And in fact, we did so in the vast majority of markets. Second, the macroeconomic environment this past quarter was markedly more challenging than 12 months ago. Third, we experienced significant supply shortages for iPhone 14 Pro and iPhone 14 Pro Max in November and through December. On the other hand, we had the positive impact of the 14th week in the quarter that Tejas just mentioned at the beginning of the call. Products revenue was $96.4 billion, down 8% from last year due to the factors I just called out. At the same time, however, our installed base of active devices grew double digits and achieved all - time records in each geographic segment and in each major product category. We 're proud to now have over 2 billion active devices in our installed base. This continued growth in the installed base is due to extremely strong levels of customer satisfaction and loyalty and a high number of customers who are new to our products. The installed base growth also helped our services set an all - time revenue record of $20.8 billion, up 6% over a year ago. We achieved this new milestone despite more than 700 basis points of negative impact from foreign exchange. We reached all - time services revenue records in the Americas, Europe and rest of Asia Pacific and a December quarter record in Greater China. We also set records in many Services categories, including all - time revenue records for cloud services, payment services and music and December quarter records for the App Store and AppleCare. Company gross margin was 43%, up 70 basis points from last quarter due to leverage and favorable mix, partially offset by foreign exchange. Products gross margin was 37%, up 240 basis points sequentially. And Services gross margin was 70.8%, up 30 basis points sequentially, both due to the same factors that impacted total company gross margin. Operating expenses of $14.3 billion were significantly below the guidance range we provided at the beginning of the quarter and grew at a slower pace than in the past as we took actions to respond to the current macro environment. Net income was $30 billion. Diluted earnings per share were $1.88, and we generated very strong operating cash flow of $34 billion. Let me now get into more detail for each of our revenue categories. iPhone revenue was $65.8 billion despite significant foreign exchange headwinds, supply constraints on iPhone 14 Pro and iPhone 14 Pro Max and a challenging macroeconomic environment. In spite of these circumstances, we set all - time iPhone revenue records in Canada, Italy and Spain, and saw strong growth in several emerging markets, including all - time iPhone revenue records for India and Vietnam. Importantly, the installed base of active iPhones continues to grow nicely and is at an all - time high across all geographic segments. In emerging markets, in particular, the installed base grew double digits, and we had record levels of switchers in India and in Mexico. Our customers continue to love their experience with our products with the latest survey of U.S. consumers from 451 Research indicating customer satisfaction of 98% for the iPhone 14 family. Mac revenue was $7.7 billion, down 29% year - over - year and in line with our expectations. There were 3 key drivers for our Mac results. First, we had a challenging compare against last year 's launch of the completely reimagined MacBook Pros, our first notebooks with M1 Pro and M1 Max. Second, we believe that the macro environment impacted our Mac performance. And third, we faced significant foreign exchange headwinds. At the same time, however, the installed base of active Macs reached an all - time high across all geographic segments, and we continue to see very strong upgraded activity to Apple silicon. Customer satisfaction with Mac remains very strong at 96% based on the latest survey of U.S. consumers from 451 Research. iPad revenue was $9.4 billion, up 30% year - over - year despite significant FX headwinds. This performance was driven by 2 key items. First, during the December quarter a year ago, we experienced significant supply constraints, while this year, we had enough supply to meet demand. Second, we launched our new iPad and the iPad Pro powered by the M2 chip during the quarter. The iPad installed base reached a new all - time high, thanks to incredible customer loyalty and a high number of new customers. In fact, over half of the customers who purchased iPads during the quarter were new to the product. Wearables, Home and Accessories revenue was $13.5 billion, down 8% year - over - year. The year - over - year decline was driven by significant FX headwinds and a challenging macroeconomic environment. However, our installed base of devices in the category set a new all - time record thanks to the largest number of customers new to our smartwatch that we ' ve ever had in a given quarter. In fact, nearly 2/3 of customers purchasing an Apple Watch during the quarter were new to the product. Moving to Services. We generated $20.8 billion in revenue, a new all - time record in total and for many Services offerings in spite of a difficult foreign exchange environment, and macroeconomic headwinds impacting certain categories such as digital advertising and mobile gaming. In constant currency, we grew Services revenue double digits on top of growing 24% during the December quarter a year ago. We remain focused on the large long - term opportunity in this category, and we continue to observe several trends that reflect the strength of our ecosystem. For example, we saw increased customer engagement with our Services during the quarter. Both our transacting accounts and paid accounts grew double digits year - over - year, each setting a new all - time record. Paid subscriptions also continued to grow nicely. We now have more than 935 million paid subscriptions across the services on our platform, up more than 150 million during the last 12 months alone and nearly 4x what we had just 5 years ago. And we continue to increase the reach and improve the quality of our offerings. For instance, Apple Pay is now available to millions of merchants in nearly 70 countries and regions. And we saw a record - breaking number of purchases made using Apple Pay globally during the holiday shopping season. Finally, our installed base of over 2 billion active devices represents a great foundation for future expansion of our ecosystem, and it continues to grow even during difficult macroeconomic conditions, which speaks to the exceptionally high levels of customer loyalty and satisfaction and our ability to attract new customers to our platform. The growth is coming from every major product category and geographic segment, with strong double - digit increases in emerging markets such as Brazil, Mexico, India, Indonesia, Thailand and Vietnam. Turning to the enterprise market. we are seeing continued adoption of our Services for business like Apple Business Essentials, AppleCare, Tap to Pay and Apple Financial Services. For example, Mars Incorporated has expanded its use of AppleCare for Enterprise to provide timely device support and assurance for iPads deployed across their manufacturing sites. Meanwhile, HCA Healthcare has leveraged Apple Financial Services to manage the annual refresh of its entire fleet of iPhones. This not only ensures that their staff stay current on the latest Apple technology, but also provides them with significant annual savings in the process. Let me now turn to our capital return program and our cash position. We returned over $25 billion to shareholders during the December quarter as our business continues to generate very strong cash flow. This included $3.8 billion in dividends and equivalents and $19 billion through open market repurchases of 133 million Apple shares. We ended the quarter with $165 billion in cash and marketable securities. We repaid $1.4 billion in maturing debt and decreased commercial paper by $8.2 billion, leaving us with total debt of $111 billion. As a result, net cash was $54 billion at the end of the quarter, and we maintain our goal of becoming net cash - neutral over time. As we move into the March quarter, I 'd like to review our outlook, which includes the types of forward - looking information that Tejas referred to at the beginning of the call. Given the continued uncertainty around the world in the near term, we are not providing revenue guidance, but we are sharing some directional insights based on the assumption that the macroeconomic outlook and COVID - related impacts to our business do not worsen from what we are projecting today for the current quarter. In total, we expect our March quarter year - over - year revenue performance to be similar to the December quarter. This represents an acceleration in our underlying year - over - year business performance as the December quarter benefited from an extra week. Foreign exchange will continue to be a headwind, and we expect a negative year - over - year impact of 5 percentage points. For Services, we expect revenue to grow year - over - year while continuing to face macroeconomic headwinds in areas such as digital advertising and mobile gaming. For iPhone, we expect our March quarter year - over - year revenue performance to accelerate relative to the December quarter year - over - year revenue performance. For Mac and iPad, we expect revenue for both product categories to decline double digits year - over - year because of challenging compares and macroeconomic headwinds. We expect gross margin to be between 43.5% and 44.5%. We expect OpEx to be between $13.7 billion and $13.9 billion. We expect OI&E to be around negative $100 million, excluding any potential impact from the mark - to - market of minority investments, and our tax rate to be around 16%. Finally, today, our Board of Directors has declared a cash dividend of $0.23 per share of common stock payable on February 16, 2023, to shareholders of record as of February 13, 2023. With that, let 's open the call to questions.", "ground_truth_output": { "entities": [ { "id": 46, "label": "Traditional", "start_offset": 79, "end_offset": 86, "text": "revenue", "global_span": [ 12604, 12611 ] }, { "id": 47, "label": "Traditional", "start_offset": 95, "end_offset": 111, "text": "December quarter", "global_span": [ 12620, 12636 ] }, { "id": 48, "label": "Value", "start_offset": 116, "end_offset": 130, "text": "$117.2 billion", "global_span": [ 12641, 12655 ] }, { "id": 49, "label": "Value", "start_offset": 132, "end_offset": 139, "text": "down 5%", "global_span": [ 12657, 12664 ] }, { "id": 50, "label": "Traditional", "start_offset": 140, "end_offset": 154, "text": "from last year", "global_span": [ 12665, 12679 ] }, { "id": 51, "label": "Traditional", "start_offset": 826, "end_offset": 842, "text": "Products revenue", "global_span": [ 13351, 13367 ] }, { "id": 52, "label": "Value", "start_offset": 847, "end_offset": 860, "text": "$96.4 billion", "global_span": [ 13372, 13385 ] }, { "id": 53, "label": "Value", "start_offset": 862, "end_offset": 869, "text": "down 8%", "global_span": [ 13387, 13394 ] }, { "id": 54, "label": "Traditional", "start_offset": 875, "end_offset": 884, "text": "last year", "global_span": [ 13400, 13409 ] }, { "id": 55, "label": "Value", "start_offset": 1131, "end_offset": 1140, "text": "2 billion", "global_span": [ 13656, 13665 ] }, { "id": 56, "label": "Traditional", "start_offset": 1141, "end_offset": 1155, "text": "active devices", "global_span": [ 13666, 13680 ] }, { "id": 57, "label": "Traditional", "start_offset": 1360, "end_offset": 1381, "text": "installed base growth", "global_span": [ 13885, 13906 ] }, { "id": 58, "label": "Traditional", "start_offset": 1425, "end_offset": 1439, "text": "revenue record", "global_span": [ 13950, 13964 ] }, { "id": 59, "label": "Value", "start_offset": 1443, "end_offset": 1456, "text": "$20.8 billion", "global_span": [ 13968, 13981 ] }, { "id": 60, "label": "Value", "start_offset": 1458, "end_offset": 1463, "text": "up 6%", "global_span": [ 13983, 13988 ] }, { "id": 61, "label": "Traditional", "start_offset": 1464, "end_offset": 1479, "text": "over a year ago", "global_span": [ 13989, 14004 ] }, { "id": 62, "label": "Value", "start_offset": 1792, "end_offset": 1795, "text": "all", "global_span": [ 14317, 14320 ] }, { "id": 63, "label": "Value", "start_offset": 1798, "end_offset": 1818, "text": "time revenue records", "global_span": [ 14323, 14343 ] }, { "id": 64, "label": "Traditional", "start_offset": 1823, "end_offset": 1837, "text": "cloud services", "global_span": [ 14348, 14362 ] }, { "id": 65, "label": "Traditional", "start_offset": 1839, "end_offset": 1855, "text": "payment services", "global_span": [ 14364, 14380 ] }, { "id": 66, "label": "Traditional", "start_offset": 1860, "end_offset": 1865, "text": "music", "global_span": [ 14385, 14390 ] }, { "id": 67, "label": "Traditional", "start_offset": 1928, "end_offset": 1948, "text": "Company gross margin", "global_span": [ 14453, 14473 ] }, { "id": 68, "label": "Value", "start_offset": 1953, "end_offset": 1956, "text": "43%", "global_span": [ 14478, 14481 ] }, { "id": 69, "label": "Value", "start_offset": 1958, "end_offset": 1976, "text": "up 70 basis points", "global_span": [ 14483, 14501 ] }, { "id": 70, "label": "Traditional", "start_offset": 1982, "end_offset": 1994, "text": "last quarter", "global_span": [ 14507, 14519 ] }, { "id": 71, "label": "Traditional", "start_offset": 2068, "end_offset": 2089, "text": "Products gross margin", "global_span": [ 14593, 14614 ] }, { "id": 72, "label": "Value", "start_offset": 2094, "end_offset": 2097, "text": "37%", "global_span": [ 14619, 14622 ] }, { "id": 73, "label": "Value", "start_offset": 2102, "end_offset": 2111, "text": "240 basis", "global_span": [ 14627, 14636 ] }, { "id": 74, "label": "Value", "start_offset": 2163, "end_offset": 2168, "text": "70.8%", "global_span": [ 14688, 14693 ] }, { "id": 75, "label": "Value", "start_offset": 2170, "end_offset": 2188, "text": "up 30 basis points", "global_span": [ 14695, 14713 ] }, { "id": 76, "label": "Traditional", "start_offset": 2276, "end_offset": 2294, "text": "Operating expenses", "global_span": [ 14801, 14819 ] }, { "id": 77, "label": "Value", "start_offset": 2298, "end_offset": 2311, "text": "$14.3 billion", "global_span": [ 14823, 14836 ] }, { "id": 78, "label": "Traditional", "start_offset": 2507, "end_offset": 2517, "text": "Net income", "global_span": [ 15032, 15042 ] }, { "id": 79, "label": "Value", "start_offset": 2522, "end_offset": 2533, "text": "$30 billion", "global_span": [ 15047, 15058 ] }, { "id": 80, "label": "Traditional", "start_offset": 2535, "end_offset": 2561, "text": "Diluted earnings per share", "global_span": [ 15060, 15086 ] }, { "id": 81, "label": "Value", "start_offset": 2567, "end_offset": 2572, "text": "$1.88", "global_span": [ 15092, 15097 ] }, { "id": 82, "label": "Traditional", "start_offset": 2603, "end_offset": 2622, "text": "operating cash flow", "global_span": [ 15128, 15147 ] }, { "id": 83, "label": "Value", "start_offset": 2626, "end_offset": 2637, "text": "$34 billion", "global_span": [ 15151, 15162 ] }, { "id": 84, "label": "Traditional", "start_offset": 2709, "end_offset": 2723, "text": "iPhone revenue", "global_span": [ 15234, 15248 ] }, { "id": 85, "label": "Value", "start_offset": 2728, "end_offset": 2741, "text": "$65.8 billion", "global_span": [ 15253, 15266 ] }, { "id": 86, "label": "Non_Traditional", "start_offset": 3524, "end_offset": 3545, "text": "customer satisfaction", "global_span": [ 16049, 16070 ] }, { "id": 87, "label": "Value", "start_offset": 3549, "end_offset": 3552, "text": "98%", "global_span": [ 16074, 16077 ] }, { "id": 88, "label": "Non_Traditional", "start_offset": 3561, "end_offset": 3570, "text": "iPhone 14", "global_span": [ 16086, 16095 ] }, { "id": 89, "label": "Traditional", "start_offset": 3581, "end_offset": 3592, "text": "Mac revenue", "global_span": [ 16106, 16117 ] }, { "id": 90, "label": "Value", "start_offset": 3597, "end_offset": 3609, "text": "$7.7 billion", "global_span": [ 16122, 16134 ] }, { "id": 91, "label": "Value", "start_offset": 3611, "end_offset": 3619, "text": "down 29%", "global_span": [ 16136, 16144 ] }, { "id": 92, "label": "Traditional", "start_offset": 3620, "end_offset": 3638, "text": "year - over - year", "global_span": [ 16145, 16163 ] }, { "id": 93, "label": "Non_Traditional", "start_offset": 4198, "end_offset": 4219, "text": "Customer satisfaction", "global_span": [ 16723, 16744 ] }, { "id": 94, "label": "Non_Traditional", "start_offset": 4225, "end_offset": 4228, "text": "Mac", "global_span": [ 16750, 16753 ] }, { "id": 95, "label": "Value", "start_offset": 4252, "end_offset": 4255, "text": "96%", "global_span": [ 16777, 16780 ] }, { "id": 96, "label": "Traditional", "start_offset": 4322, "end_offset": 4334, "text": "iPad revenue", "global_span": [ 16847, 16859 ] }, { "id": 97, "label": "Value", "start_offset": 4339, "end_offset": 4351, "text": "$9.4 billion", "global_span": [ 16864, 16876 ] }, { "id": 98, "label": "Value", "start_offset": 4356, "end_offset": 4359, "text": "30%", "global_span": [ 16881, 16884 ] }, { "id": 99, "label": "Traditional", "start_offset": 4929, "end_offset": 4968, "text": "Wearables, Home and Accessories revenue", "global_span": [ 17454, 17493 ] }, { "id": 100, "label": "Value", "start_offset": 4973, "end_offset": 4986, "text": "$13.5 billion", "global_span": [ 17498, 17511 ] }, { "id": 101, "label": "Value", "start_offset": 4988, "end_offset": 4995, "text": "down 8%", "global_span": [ 17513, 17520 ] }, { "id": 102, "label": "Traditional", "start_offset": 4996, "end_offset": 5014, "text": "year - over - year", "global_span": [ 17521, 17539 ] }, { "id": 103, "label": "Traditional", "start_offset": 5435, "end_offset": 5443, "text": "Services", "global_span": [ 17960, 17968 ] }, { "id": 104, "label": "Value", "start_offset": 5458, "end_offset": 5471, "text": "$20.8 billion", "global_span": [ 17983, 17996 ] }, { "id": 105, "label": "Traditional", "start_offset": 5475, "end_offset": 5482, "text": "revenue", "global_span": [ 18000, 18007 ] }, { "id": 106, "label": "Traditional", "start_offset": 5710, "end_offset": 5727, "text": "constant currency", "global_span": [ 18235, 18252 ] }, { "id": 107, "label": "Traditional", "start_offset": 5737, "end_offset": 5753, "text": "Services revenue", "global_span": [ 18262, 18278 ] }, { "id": 108, "label": "Value", "start_offset": 5754, "end_offset": 5767, "text": "double digits", "global_span": [ 18279, 18292 ] }, { "id": 109, "label": "Value", "start_offset": 5786, "end_offset": 5789, "text": "24%", "global_span": [ 18311, 18314 ] }, { "id": 110, "label": "Value", "start_offset": 6278, "end_offset": 6289, "text": "935 million", "global_span": [ 18803, 18814 ] }, { "id": 111, "label": "Traditional", "start_offset": 6290, "end_offset": 6328, "text": "paid subscriptions across the services", "global_span": [ 18815, 18853 ] }, { "id": 112, "label": "Value", "start_offset": 6359, "end_offset": 6370, "text": "150 million", "global_span": [ 18884, 18895 ] }, { "id": 113, "label": "Non_Traditional", "start_offset": 6543, "end_offset": 6552, "text": "Apple Pay", "global_span": [ 19068, 19077 ] }, { "id": 114, "label": "Non_Traditional", "start_offset": 6560, "end_offset": 6569, "text": "available", "global_span": [ 19085, 19094 ] }, { "id": 115, "label": "Value", "start_offset": 6573, "end_offset": 6594, "text": "millions of merchants", "global_span": [ 19098, 19119 ] }, { "id": 116, "label": "Value", "start_offset": 6605, "end_offset": 6617, "text": "70 countries", "global_span": [ 19130, 19142 ] }, { "id": 117, "label": "Value", "start_offset": 6786, "end_offset": 6795, "text": "2 billion", "global_span": [ 19311, 19320 ] }, { "id": 118, "label": "Non_Traditional", "start_offset": 6796, "end_offset": 6810, "text": "active devices", "global_span": [ 19321, 19335 ] }, { "id": 119, "label": "Traditional", "start_offset": 8011, "end_offset": 8019, "text": "returned", "global_span": [ 20536, 20544 ] }, { "id": 120, "label": "Value", "start_offset": 8025, "end_offset": 8036, "text": "$25 billion", "global_span": [ 20550, 20561 ] }, { "id": 121, "label": "Traditional", "start_offset": 8040, "end_offset": 8052, "text": "shareholders", "global_span": [ 20565, 20577 ] }, { "id": 122, "label": "Traditional", "start_offset": 8064, "end_offset": 8080, "text": "December quarter", "global_span": [ 20589, 20605 ] }, { "id": 123, "label": "Value", "start_offset": 8156, "end_offset": 8168, "text": "$3.8 billion", "global_span": [ 20681, 20693 ] }, { "id": 124, "label": "Traditional", "start_offset": 8172, "end_offset": 8197, "text": "dividends and equivalents", "global_span": [ 20697, 20722 ] }, { "id": 125, "label": "Value", "start_offset": 8202, "end_offset": 8213, "text": "$19 billion", "global_span": [ 20727, 20738 ] }, { "id": 126, "label": "Traditional", "start_offset": 8222, "end_offset": 8245, "text": "open market repurchases", "global_span": [ 20747, 20770 ] }, { "id": 127, "label": "Value", "start_offset": 8249, "end_offset": 8260, "text": "133 million", "global_span": [ 20774, 20785 ] }, { "id": 128, "label": "Traditional", "start_offset": 8261, "end_offset": 8273, "text": "Apple shares", "global_span": [ 20786, 20798 ] }, { "id": 129, "label": "Traditional", "start_offset": 8278, "end_offset": 8283, "text": "ended", "global_span": [ 20803, 20808 ] }, { "id": 130, "label": "Traditional", "start_offset": 8288, "end_offset": 8295, "text": "quarter", "global_span": [ 20813, 20820 ] }, { "id": 131, "label": "Value", "start_offset": 8301, "end_offset": 8313, "text": "$165 billion", "global_span": [ 20826, 20838 ] }, { "id": 132, "label": "Traditional", "start_offset": 8317, "end_offset": 8347, "text": "cash and marketable securities", "global_span": [ 20842, 20872 ] }, { "id": 133, "label": "Value", "start_offset": 8359, "end_offset": 8371, "text": "$1.4 billion", "global_span": [ 20884, 20896 ] }, { "id": 134, "label": "Traditional", "start_offset": 8375, "end_offset": 8388, "text": "maturing debt", "global_span": [ 20900, 20913 ] }, { "id": 135, "label": "Traditional", "start_offset": 8393, "end_offset": 8419, "text": "decreased commercial paper", "global_span": [ 20918, 20944 ] }, { "id": 136, "label": "Value", "start_offset": 8423, "end_offset": 8435, "text": "$8.2 billion", "global_span": [ 20948, 20960 ] }, { "id": 137, "label": "Traditional", "start_offset": 8453, "end_offset": 8463, "text": "total debt", "global_span": [ 20978, 20988 ] }, { "id": 138, "label": "Value", "start_offset": 8467, "end_offset": 8479, "text": "$111 billion", "global_span": [ 20992, 21004 ] }, { "id": 139, "label": "Traditional", "start_offset": 8494, "end_offset": 8502, "text": "net cash", "global_span": [ 21019, 21027 ] }, { "id": 140, "label": "Value", "start_offset": 8507, "end_offset": 8518, "text": "$54 billion", "global_span": [ 21032, 21043 ] }, { "id": 141, "label": "Traditional", "start_offset": 9673, "end_offset": 9679, "text": "iPhone", "global_span": [ 22198, 22204 ] }, { "id": 142, "label": "Traditional", "start_offset": 9681, "end_offset": 9713, "text": "we expect our March quarter year", "global_span": [ 22206, 22238 ] }, { "id": 143, "label": "Traditional", "start_offset": 9716, "end_offset": 9747, "text": "over - year revenue performance", "global_span": [ 22241, 22272 ] }, { "id": 144, "label": "Value", "start_offset": 9751, "end_offset": 9761, "text": "accelerate", "global_span": [ 22276, 22286 ] }, { "id": 145, "label": "Traditional", "start_offset": 9762, "end_offset": 9833, "text": "relative to the December quarter year - over - year revenue performance", "global_span": [ 22287, 22358 ] }, { "id": 146, "label": "Traditional", "start_offset": 9839, "end_offset": 9842, "text": "Mac", "global_span": [ 22364, 22367 ] }, { "id": 147, "label": "Traditional", "start_offset": 9847, "end_offset": 9851, "text": "iPad", "global_span": [ 22372, 22376 ] }, { "id": 148, "label": "Traditional", "start_offset": 9856, "end_offset": 9870, "text": "expect revenue", "global_span": [ 22381, 22395 ] }, { "id": 149, "label": "Value", "start_offset": 9902, "end_offset": 9923, "text": "decline double digits", "global_span": [ 22427, 22448 ] }, { "id": 150, "label": "Traditional", "start_offset": 9924, "end_offset": 9942, "text": "year - over - year", "global_span": [ 22449, 22467 ] }, { "id": 151, "label": "Traditional", "start_offset": 10009, "end_offset": 10028, "text": "expect gross margin", "global_span": [ 22534, 22553 ] }, { "id": 152, "label": "Value", "start_offset": 10043, "end_offset": 10048, "text": "43.5%", "global_span": [ 22568, 22573 ] }, { "id": 153, "label": "Value", "start_offset": 10053, "end_offset": 10058, "text": "44.5%", "global_span": [ 22578, 22583 ] }, { "id": 154, "label": "Traditional", "start_offset": 10063, "end_offset": 10074, "text": "expect OpEx", "global_span": [ 22588, 22599 ] }, { "id": 155, "label": "Value", "start_offset": 10089, "end_offset": 10120, "text": "$13.7 billion and $13.9 billion", "global_span": [ 22614, 22645 ] }, { "id": 156, "label": "Traditional", "start_offset": 10125, "end_offset": 10136, "text": "expect OI&E", "global_span": [ 22650, 22661 ] }, { "id": 157, "label": "Value", "start_offset": 10159, "end_offset": 10171, "text": "$100 million", "global_span": [ 22684, 22696 ] }, { "id": 158, "label": "Traditional", "start_offset": 10235, "end_offset": 10255, "text": "minority investments", "global_span": [ 22760, 22780 ] }, { "id": 159, "label": "Traditional", "start_offset": 10265, "end_offset": 10273, "text": "tax rate", "global_span": [ 22790, 22798 ] }, { "id": 160, "label": "Value", "start_offset": 10287, "end_offset": 10290, "text": "16%", "global_span": [ 22812, 22815 ] }, { "id": 161, "label": "Traditional", "start_offset": 10348, "end_offset": 10361, "text": "cash dividend", "global_span": [ 22873, 22886 ] }, { "id": 162, "label": "Value", "start_offset": 10365, "end_offset": 10380, "text": "$0.23 per share", "global_span": [ 22890, 22905 ] }, { "id": 188, "label": "Traditional", "text": "all - time services revenue records", "start_offset": 1600, "end_offset": 1635, "global_span": [ 14125, 14160 ] }, { "id": 189, "label": "Traditional", "text": "Americas, Europe and rest of Asia Pacific", "start_offset": 1643, "end_offset": 1684, "global_span": [ 14168, 14209 ] }, { "id": 190, "label": "Traditional", "text": " December quarter record", "start_offset": 1690, "end_offset": 1714, "global_span": [ 14215, 14239 ] }, { "id": 191, "label": "Traditional", "text": "Greater China", "start_offset": 1718, "end_offset": 1731, "global_span": [ 14243, 14256 ] }, { "id": 192, "label": "Traditional", "text": "December quarter records", "start_offset": 1870, "end_offset": 1894, "global_span": [ 14395, 14419 ] }, { "id": 193, "label": "Traditional", "text": "App Store and AppleCare", "start_offset": 1903, "end_offset": 1926, "global_span": [ 14428, 14451 ] }, { "id": 194, "label": "Traditional", "text": "end of the quarter", "start_offset": 8526, "end_offset": 8544, "global_span": [ 21051, 21069 ] } ], "relations": [ { "id": 21, "entity_ids": [ 46, 47, 48 ], "description": "Value_of" }, { "id": 22, "entity_ids": [ 46, 47, 49, 50 ], "description": "Value_of" }, { "id": 23, "entity_ids": [ 51, 52 ], "description": "Value_of" }, { "id": 24, "entity_ids": [ 51, 53, 54 ], "description": "Value_of" }, { "id": 25, "entity_ids": [ 55, 56 ], "description": "Value_of" }, { "id": 26, "entity_ids": [ 58, 59 ], "description": "Value_of" }, { "id": 27, "entity_ids": [ 60, 61 ], "description": "Value_of" }, { "id": 28, "entity_ids": [ 62, 63, 64, 65, 66 ], "description": "Value_of" }, { "id": 29, "entity_ids": [ 67, 68 ], "description": "Value_of" }, { "id": 30, "entity_ids": [ 67, 69, 70 ], "description": "Value_of" }, { "id": 31, "entity_ids": [ 71, 72 ], "description": "Value_of" }, { "id": 32, "entity_ids": [ 71, 73 ], "description": "Value_of" }, { "id": 33, "entity_ids": [ 74 ], "description": "Value_of" }, { "id": 34, "entity_ids": [ 75 ], "description": "Value_of" }, { "id": 35, "entity_ids": [ 76, 77 ], "description": "Value_of" }, { "id": 36, "entity_ids": [ 78, 79 ], "description": "Value_of" }, { "id": 37, "entity_ids": [ 80, 81 ], "description": "Value_of" }, { "id": 38, "entity_ids": [ 82, 83 ], "description": "Value_of" }, { "id": 39, "entity_ids": [ 84, 85 ], "description": "Value_of" }, { "id": 40, "entity_ids": [ 86, 87, 88 ], "description": "Value_of" }, { "id": 41, "entity_ids": [ 89, 90 ], "description": "Value_of" }, { "id": 42, "entity_ids": [ 89, 91, 92 ], "description": "Value_of" }, { "id": 43, "entity_ids": [ 93, 94, 95 ], "description": "Value_of" }, { "id": 44, "entity_ids": [ 96, 97 ], "description": "Value_of" }, { "id": 45, "entity_ids": [ 96, 98 ], "description": "Value_of" }, { "id": 46, "entity_ids": [ 96, 98 ], "description": "Value_of" }, { "id": 47, "entity_ids": [ 99, 100 ], "description": "Value_of" }, { "id": 48, "entity_ids": [ 99, 101, 102 ], "description": "Value_of" }, { "id": 49, "entity_ids": [ 103, 104, 105 ], "description": "Value_of" }, { "id": 50, "entity_ids": [ 106, 107, 108 ], "description": "Value_of" }, { "id": 51, "entity_ids": [ 106, 107, 109 ], "description": "Value_of" }, { "id": 52, "entity_ids": [ 110, 111 ], "description": "Value_of" }, { "id": 53, "entity_ids": [ 111, 112 ], "description": "Value_of" }, { "id": 54, "entity_ids": [ 113, 114, 115 ], "description": "Value_of" }, { "id": 55, "entity_ids": [ 113, 114, 116 ], "description": "Value_of" }, { "id": 56, "entity_ids": [ 117, 118 ], "description": "Value_of" }, { "id": 57, "entity_ids": [ 119, 120, 121, 122 ], "description": "Value_of" }, { "id": 58, "entity_ids": [ 123, 124 ], "description": "Value_of" }, { "id": 59, "entity_ids": [ 125, 126 ], "description": "Value_of" }, { "id": 60, "entity_ids": [ 126, 127, 128 ], "description": "Value_of" }, { "id": 61, "entity_ids": [ 129, 130, 131, 132 ], "description": "Value_of" }, { "id": 62, "entity_ids": [ 133, 134 ], "description": "Value_of" }, { "id": 63, "entity_ids": [ 135, 136 ], "description": "Value_of" }, { "id": 64, "entity_ids": [ 137, 138 ], "description": "Value_of" }, { "id": 65, "entity_ids": [ 139, 140 ], "description": "Value_of" }, { "id": 66, "entity_ids": [ 141, 142, 143, 144, 145 ], "description": "Value_of" }, { "id": 67, "entity_ids": [ 146, 147, 148, 149, 150 ], "description": "Value_of" }, { "id": 68, "entity_ids": [ 151, 152, 153 ], "description": "Value_of" }, { "id": 69, "entity_ids": [ 154, 155 ], "description": "Value_of" }, { "id": 70, "entity_ids": [ 156, 157 ], "description": "Value_of" }, { "id": 71, "entity_ids": [ 159, 160 ], "description": "Value_of" }, { "id": 72, "entity_ids": [ 161, 162 ], "description": "Value_of" }, { "id": 86, "entity_ids": [ 192, 193 ], "description": "Value_of" }, { "id": 87, "entity_ids": [ 139, 140, 194 ], "description": "Value_of" } ] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "Tejas Gala: Thank you, Luca. [Operator Instructions ]. Operator, may we have the first question, please.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Operator: [Operator Instructions ]. Certainly. We will go ahead and take our first question from David Vogt with UBS.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "David Vogt: So Tim, and maybe this is for Luca as well. You talked about the supply chain returning back to normal after a very difficult October, November, but we 're still seeing some disruptions across tech products, whether it 's enterprise or consumer - facing. How do you think about your supply chain and maybe the levels of inventory or builds that you might need as we go forward to sort of insulate your business from these sort of episodic disruptions? Have you changed your view? And if so, how does that affect ultimately margins and sort of your balance sheet and cash flow items going forward?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Timothy Cook: This is Tim, David. From a supply point of view, we did see disruption from early November through most of December. And from a supply chain point of view, we 're now at a point where production is what we need it to be. And so the problem is behind us. In terms of going forward in the supply chain, we build our products everywhere. There are component parts coming from many different countries in the world, and the final assembly coming from 3 countries in the world on just iPhone. And so we continue to optimize it. We 'll continue to optimize it over time and change it to continue to improve. I think when you sort of zoom out and back up from it, the last 3 years have been a pretty difficult time between COVID and silicon shortages and the like. And I think it 's -- I think we have had a very resilient supply chain in the aggregate. In terms of supply for this quarter, which I think was one of your points, I think we 're in decent supply on most products for the quarter currently.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Operator: Our next question is from Shannon Cross of Credit Suisse.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Shannon Cross: Luca, I wanted to dig a bit more into the commentary on gross margins. The guidance, especially at 43.5% to 44.5%, is obviously quite strong. So I ' m wondering what 's helping you out there, assume mix and some other things. And then how should we think about what currency and hedge is going to do as we look forward? And then I have a follow - up.", "ground_truth_output": { "entities": [ { "id": 163, "label": "Traditional", "start_offset": 74, "end_offset": 87, "text": "gross margins", "global_span": [ 25046, 25059 ] }, { "id": 164, "label": "Traditional", "start_offset": 93, "end_offset": 101, "text": "guidance", "global_span": [ 25065, 25073 ] }, { "id": 165, "label": "Value", "start_offset": 117, "end_offset": 122, "text": "43.5%", "global_span": [ 25089, 25094 ] }, { "id": 166, "label": "Value", "start_offset": 126, "end_offset": 131, "text": "44.5%", "global_span": [ 25098, 25103 ] } ], "relations": [ { "id": 73, "entity_ids": [ 163, 164, 165, 166 ], "description": "Value_of" } ] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Luca Maestri: Shannon, yes, I mean, we ' ve had good margin for the December quarter to start with. We reported 43%. Obviously, in December, we have the benefit of leverage because of the seasonality of the business, but we also had favorable mix across the board. Of course, foreign exchange is an issue right now. In the December quarter on a sequential basis, foreign exchange was a negative 110 basis points for us. And on a year - over - year basis, it 's 300 basis points. So obviously, the FX environment has changed a lot during the last 12 months. For March, yes, we ' ve seen a margin expansion, 43.5% to 44.5%. We 're doing a lot of work around cost, of course. Mix will continue to help, both within categories and services mix as we move away from the holiday season. But we 're doing a lot of work on the cost structure, and that is paying off. Foreign exchange is still a negative, about 50 basis points sequentially, but it 's mitigating. The last couple of weeks, the dollar has weakened a bit. And so hopefully, as we go through the year, hopefully, things will improve. But for now, as you correctly state, we are in a good position on margins.", "ground_truth_output": { "entities": [ { "id": 167, "label": "Traditional", "start_offset": 54, "end_offset": 60, "text": "margin", "global_span": [ 25394, 25400 ] }, { "id": 168, "label": "Traditional", "start_offset": 69, "end_offset": 85, "text": "December quarter", "global_span": [ 25409, 25425 ] }, { "id": 169, "label": "Value", "start_offset": 113, "end_offset": 116, "text": "43%", "global_span": [ 25453, 25456 ] }, { "id": 170, "label": "Traditional", "start_offset": 566, "end_offset": 571, "text": "March", "global_span": [ 25906, 25911 ] }, { "id": 171, "label": "Traditional", "start_offset": 593, "end_offset": 609, "text": "margin expansion", "global_span": [ 25933, 25949 ] }, { "id": 172, "label": "Value", "start_offset": 611, "end_offset": 625, "text": "43.5% to 44.5%", "global_span": [ 25951, 25965 ] } ], "relations": [ { "id": 74, "entity_ids": [ 167, 168, 169 ], "description": "Value_of" }, { "id": 75, "entity_ids": [ 170, 171, 172 ], "description": "Value_of" } ] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Shannon Cross: And then, Tim, can you talk a bit about China? What you 're seeing -- obviously, you ' ve had the issues with production, but I mean more on the demand side. As we ' ve gotten through Chinese New Year and the opening, I ' m just wondering, are you seeing the Chinese consumer come back? What are they buying? And how are you thinking about your position there?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Timothy Cook: Shannon, last quarter, we declined by 7% on a reported basis, but we actually grew on a constant currency basis. And that was despite some significant -- the supply constraints that we talked about earlier. And obviously, the sort of the COVID restrictions throughout China that happened in various different places throughout the country also impacted the demand during the quarter. When you look at the opening that started happening in December, we saw a marked change in traffic in our stores as compared to November. And that followed through to demand as well. And I do n't want to get into January. We ' ve obviously -- January is included in the guidance, or the color rather, that Luca provided earlier. But we did see a marked change from December compared to November.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Operator: Our next question is from Erik Woodring of Morgan Stanley.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Erik Woodring: Maybe, Tim, first one for you. That 2 billion installed base -- device installed base figure, that 's up, I believe, 200 million units year - over - year. That implies the strongest annual gain in new devices in your installed base basically as far back as you ' ve provided those data points. And so I guess my 2 questions are: one, do you -- can you provide the installed base for the iPhone at year - end? And then two, is there anything that you see in this new cohort of users that might look different or similar to past cohorts, either by demographic or regions or monetization ramp? And then I have a follow - up.", "ground_truth_output": { "entities": [ { "id": 173, "label": "Value", "start_offset": 52, "end_offset": 61, "text": "2 billion", "global_span": [ 27804, 27813 ] }, { "id": 174, "label": "Traditional", "start_offset": 62, "end_offset": 76, "text": "installed base", "global_span": [ 27814, 27828 ] }, { "id": 175, "label": "Traditional", "start_offset": 80, "end_offset": 101, "text": "device installed base", "global_span": [ 27832, 27853 ] }, { "id": 176, "label": "Value", "start_offset": 118, "end_offset": 120, "text": "up", "global_span": [ 27870, 27872 ] }, { "id": 177, "label": "Value", "start_offset": 133, "end_offset": 150, "text": "200 million units", "global_span": [ 27885, 27902 ] }, { "id": 178, "label": "Traditional", "start_offset": 151, "end_offset": 169, "text": "year - over - year", "global_span": [ 27903, 27921 ] } ], "relations": [ { "id": 76, "entity_ids": [ 173, 174, 175 ], "description": "Value_of" }, { "id": 77, "entity_ids": [ 175, 176, 177, 178 ], "description": "Value_of" } ] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "Timothy Cook: Yes. The installed base is now over 2 billion active devices, as you mentioned. And we set records across each geographic segment and major product category. And so it was a broad - based change. Two -- I 'll correct one thing you said, it 's up over 150 million year - over - year. The last report we reported to be over 1.85. And so it 's 150 million, which we 're very proud of. We also saw strong double - digit in several of the emerging markets, which is very important to us. For example, India and Brazil as just 2 examples. So very, very strong. And obviously, it bodes well for the future.", "ground_truth_output": { "entities": [ { "id": 179, "label": "Value", "start_offset": 258, "end_offset": 277, "text": "up over 150 million", "global_span": [ 28647, 28666 ] }, { "id": 180, "label": "Traditional", "start_offset": 278, "end_offset": 296, "text": "year - over - year", "global_span": [ 28667, 28685 ] }, { "id": 181, "label": "Value", "start_offset": 332, "end_offset": 341, "text": "over 1.85", "global_span": [ 28721, 28730 ] }, { "id": 182, "label": "Value", "start_offset": 356, "end_offset": 367, "text": "150 million", "global_span": [ 28745, 28756 ] } ], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Erik Woodring: And then, Luca, obviously, the December quarter was negatively impacted by the production challenges. Can you just maybe unpackage where channel inventory levels are today kind of across the iPhone broadly? And then what the data that you 're seeing so far this quarter is telling you about iPhone demand deferral versus kind of iPhone demand destruction and perhaps pushing some upgrades later into the year rather than into the March quarter? And that 's it for me.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "Timothy Cook: Yes. Erik, I 'll take that one as well. The channel inventory levels on iPhone, we obviously ended the December quarter below our target range given the supply challenges on iPhone 14 Pro and iPhone 14 Pro Max. But as you think about this, keep in mind that a year ago, we also exited the December quarter below our target inventory range because of supply challenges in the year ago quarter. Not related -- not the same issue, but just as a point. And so that hopefully gives you some flavor of that. In terms of what we 're seeing in January, we ' ve included in our color that Luca provided kind of our thinking. It 's very hard to estimate the recapture because you have to know exactly what would have happened and how many people bought down. And it takes a while to get that -- to get those reports in during the quarter. And so we ' ve made our best guess at it. In terms of the sizing of the constraint in Q1, what we estimate, although not with precision, is that we would -- I thought we believe iPhone would have grown during the quarter had it not been for the supply shortages. So hopefully, that provides you a little bit of color.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Aaron Rakers of Wells Fargo.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Aaron Rakers: I have two as well, if I can. I guess the first kind of question, just going back on the gross margin line. Pretty good guidance into this March quarter. I ' m curious if you unpack that a little bit specific around what you 're seeing as far as maybe benefits from component pricing in the guidance, if you 're embedding any of that at this point.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "Luca Maestri: Yes. Of course, with our guidance, we try to capture every aspect of our cost structure. And obviously, components are a big portion of that. So definitely, that 's included. And keep in mind, again, that foreign exchange -- I mentioned earlier, I think to Shannon, that the sequential negative on FX is 50 basis points, versus a year ago, it 's 270 basis points. Obviously, the U.S. dollar has moved a lot over the last 12 months. So obviously, we need to find offsets and more to the negative FX in order to be able to provide this kind of guidance. And so obviously, components are a big part of that.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Aaron Rakers: Yes. And then kind of from a strategic perspective, given kind of the things that we 're seeing out in some of your peer group, I ' m curious, Tim, how you think about the role of AI in your strategy as far as particularly in the Services segment, whether you 're not -- you see opportunities to excel monetization abilities within the paid subscriber base and whether or not AI, is it something that you 're implementing a bit more strategically there.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Timothy Cook: Yes. It is a major focus of ours. It 's incredible in terms of how it can enrich customers ' lives. And you can look no further than some of the things that we announced in the fall with crash detection and fall detection or back a ways with ECG. I mean these things have literally saved people 's lives. And so we see an enormous potential in this space to affect virtually everything we do. It 's obviously a horizontal technology, not a vertical. And so it will affect every product and every service that we have.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Amit Daryanani of Evercore.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Amit Daryanani: I guess the first one I have is, Tim, I think based on your earlier comments that iPhones would have grown ex the production issue that implied that maybe it 's a $7 billion or so impact that you had in December quarter from the production challenges on the high - end models. I ' m sure it 's tough to see what happens this time around. But I think historically, when you ' ve had production issues or things like this happen, what has the consumer behavior being typically? Do they tend to go down towards the lower end models and get the phone they want quickly? Or do they just defer the production? Just from a historical perspective, I think do you typically recover what 's deferred out or no?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Timothy Cook: It 's very hard to estimate is the real answer because you have to know a lot of data, and it 's usually only in hindsight that you have a more reasonable view of it. And so we put our best views in the color that Luca provided. That 's kind of what I would say.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Amit Daryanani: All right. And then I guess maybe if I think about Services as you go forward. I know you had really good growth in Services, I think, over the last several years. But as you go forward in Services, what do you think drives the growth more so? Is it the expansion of your installed base? Or is it more going to be driven by ARPU going higher for you? I ' m just curious, how do you think about those 2 buckets as you go forward?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 27, "sub_chunk_id": 0, "sentences": "Luca Maestri: Amit, there 's a number of things, and I ' ve mentioned a few of them during the call. The first step is always the installed base. Installed base is the engine for Services growth. And the fact that the installed base is growing very nicely, and it 's growing in a lot of emerging markets, it 's growing even faster, that gives us a larger addressable pool of customers. So that 's incredibly important. The second one is that we are seeing that the level of engagement of our customers already in our ecosystem continues to grow. We -- I mentioned that both transacting accounts and paid accounts grew double digits. And so that bodes very well for the future. And we have a lot of transacting accounts that kind of moved to paid accounts over time. The other aspect that is very important for us is to continue constantly to improve the reach and the quality of our services. And I give the example of Apple Pay, which it 's a great example because we started off primarily in the United States. Now we ' ve taken it to 70 markets, millions of merchants. And so obviously, payment services are -- continue to set new highs all the time for us. And then as you ' ve seen over the last few years, we also launched new services over time, and that obviously contributes to the growth. We 're very excited. And when we look at the behavior of our installed base, we think it 's very promising for the continued growth of our Services business.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 28, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Harsh Kumar of Piper Sandler.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 29, "sub_chunk_id": 0, "sentences": "Harsh Kumar: Tim, I had a quick question on emerging markets. Seems like you 're making a lot of strides in India. Potentially wanted to understand the kind of share you have in China and India. And relative to that, what would be your aspirational but sort of achievable share in iPhones in those territories, whether it 's units or revenues? And I was hoping to draw on your experience and maybe what you ' ve seen in other countries where you ' ve had some longer presence.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 30, "sub_chunk_id": 0, "sentences": "Timothy Cook: And looking at the business in India, we set a quarterly revenue record and grew very strong double digits year - over - year. And so we feel very good about how we performed, and that was -- that 's despite the headwinds that we ' ve talked about. Taking a step back, India is a hugely exciting market for us and is a major focus. We brought the online store there in 2020. We will soon bring Apple retail there. So we 're putting a lot of emphasis on the market. There 's been a lot done from a financing options and trade - ins to make products more affordable and give people more options to buy. And so there 's a lot going on there. We are, in essence, taking what we learned in China years ago and how we scale to China and bringing that to bear. And I do n't have the exact market shares in front of me, but I think you would see that from a market share point of view that we grew around the world last quarter despite -- on iPhone despite the challenges that we ' ve had on the supply side. And I would n't expect to have a difference in those 2 markets.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 31, "sub_chunk_id": 0, "sentences": "Harsh Kumar: Understood. And for my follow - up, I had a sort of interesting theoretical question on pricing. Assuming we get the CHIPS Act passed, and there 's a whole bunch of manufacturing that happens in U.S. and other territories that are potentially somewhat more expensive than the ones you might be now, have you -- has the company done any studies to gauge the elasticity of demand relative to small price increases in your products?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 32, "sub_chunk_id": 0, "sentences": "Timothy Cook: We have experience in that, but I would n't necessarily draw the same conclusion that you have in terms of the cost of the product. I -- we do n't know at this point exactly what that will be, but we 're all in, in terms of being the largest customer for TSMC in Arizona. I 'm very proud to take part in that. That 's what I would say about that.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 33, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Wamsi Mohan of Bank of America.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 34, "sub_chunk_id": 0, "sentences": "Wamsi Mohan: Tim, you ' ve done a phenomenal job of driving consumer choice towards higher - end products within your portfolio. How would you compare this cycle for iPhones if you were to segment the Pro versus non - Pro models versus the cycles from the past few years? And do you think this move to higher ASPs is sustainable? Or do you think it reverses in a tighter consumer spending environment? And I have a follow - up.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 35, "sub_chunk_id": 0, "sentences": "Timothy Cook: The Pro has been a -- the 14 Pro and the 14 Pro Max have done extremely well up until the point where we had a supply shortage and could n't provide them -- could n't provide the total of the demand. And so it 's definitely a strong Pro cycle. I think there 's a number of reasons for that, but the most important one is always the product. And I think the innovations and the product speak for themselves. And we feel very good about the product that we announced back in September and are happy to now be at a point where we 're shipping to the demand.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 36, "sub_chunk_id": 0, "sentences": "Wamsi Mohan: And Tim, do you think that this move to sort of higher ASPs that has happened over the last few years is sustainable? Or could it sustain in this very tough macro environment that you ' ve cited?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 37, "sub_chunk_id": 0, "sentences": "Timothy Cook: I would n't want to predict, but I would say that the smartphone for us, the iPhone has become so integral into people 's lives. It contains their contacts and their health information and their banking information and their smart home and so many different parts of their lives, their payment vehicle and -- for many people. And so I think people are willing to really stretch to get the best they can afford in that category.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 38, "sub_chunk_id": 0, "sentences": "Wamsi Mohan: Okay. Great. And Tim, you clearly emphasize the focus and importance of the installed base. If we think about the absolute grit of the installed base from 1 billion to 2 billion over 7 years from a device standpoint, how should we think about the penetration of services or the growth in paying customers on services or that time frame? Is that penetration rate increasing or decreasing? How fast is that growing relative to the growth of the overall installed base?", "ground_truth_output": { "entities": [ { "id": 183, "label": "Non_Traditional", "start_offset": 149, "end_offset": 163, "text": "installed base", "global_span": [ 39972, 39986 ] }, { "id": 184, "label": "Value", "start_offset": 169, "end_offset": 178, "text": "1 billion", "global_span": [ 39992, 40001 ] }, { "id": 185, "label": "Value", "start_offset": 182, "end_offset": 191, "text": "2 billion", "global_span": [ 40005, 40014 ] }, { "id": 186, "label": "Non_Traditional", "start_offset": 197, "end_offset": 204, "text": "7 years", "global_span": [ 40020, 40027 ] } ], "relations": [ { "id": 81, "entity_ids": [ 183, 184, 185, 186 ], "description": "Value_of" } ] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 39, "sub_chunk_id": 0, "sentences": "Luca Maestri: Wamsi, it 's Luca. Yes, of course, we keep track of that. It 's really important for us. Over the last 7 years, as we doubled the installed base, we ' ve seen a growing engagement of our customers on the platform. That happens, first of all, by customers transacting on the platform and then moving to paid accounts. So starting to pay for some of the services. That percentage of paid accounts tends to grow over time. We 've seen it in developed markets. We see it in emerging markets. And that is due to some of the reasons that I was explaining earlier, including the fact that we made it easier for our customers to get engaged on the platform. For example, we offer multiple payment methods in many countries. And we ' ve made it easier to explore for more services because we ' ve added a lot of services on the platform over the last 7 years. So to your question, of course, higher engagement means a higher percentage of paid accounts over time.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 40, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Richard Kramer of Arete Research LLP.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 41, "sub_chunk_id": 0, "sentences": "Tejas Gala: Operator, can we move on to the next?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 42, "sub_chunk_id": 0, "sentences": "Operator: Next, we 'll hear from Jim Suva of Citigroup.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 43, "sub_chunk_id": 0, "sentences": "James Suva: Tim and Luca, you both mentioned earlier on the Q&A a little bit about India. I was wondering if we 're now entering a situation of even more opportunity because we ' ve exited COVID, we ' ve exited countries with different COVID criteria. We ' ve also seen India build out its higher speed transmissions. And your market is -- shares tremendously underrepresented there. And it appears with the supply chain, you 're looking at diversifying kind of operational risk not specific to any country, but just overall. Now you look at potentially opening up stores and stuff. Am I right that, that 's the way you look at it is it 's even more prime for opportunity now than ever? And once you start opening up stores there, you could just see a complete green shoot of adoptions or any additional commentary on your view on India as now we ' ve navigated COVID and supply chain and so many challenges over the past 2 years?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 44, "sub_chunk_id": 0, "sentences": "Timothy Cook: Yes. Jim, we actually did fairly well through COVID in India. And I ' m even more bullish now on the other side of it, or hopefully, on the other side of it. And that 's the reason why we 're investing there. We 're bringing retail there and bringing the online store there and putting a significant amount of energy there. I 'm very bullish on India.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 45, "sub_chunk_id": 0, "sentences": "James Suva: And then as my quick follow - up, you had mentioned that Services, not necessarily specific to India, but Services overall were better than expected. And of course, supply chain was more challenged than expected. So what was the bridge factor of Services being better than expected on upside? Was it like advertising or apps or paid monthly subscriptions? Or what were kind of the things that really surprised you to the upside on Services?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 46, "sub_chunk_id": 0, "sentences": "Luca Maestri: It was -- Jim, it 's Luca. It 's primarily the -- this level of engagement we saw, which then reflects into the, as you said, the paid subscriptions. We saw very good results in our cloud services business in payment services. Music was very strong. So we had a number of categories that set new records, all - time records. And they did a bit better than we were expecting at the beginning of the quarter. And so Tim mentioned that during, I think, his prepared remarks that when you look at it in constant currency, we grew services double digits. And that was on top of a 24% increase a year ago. So it 's very sustained growth that we 're seeing.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 47, "sub_chunk_id": 0, "sentences": "Operator: Our next question will come from Krish Sankar of Cowen and Company.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 48, "sub_chunk_id": 0, "sentences": "Krish Sankar: I have 2. The first one, Tim and Luca, you mentioned how the macro did soften, and it has an impact. And as consumers tighten their belt, when you look across your hardware products and service businesses, where are you seeing the biggest impact and where are you seeing the least impact from the softening macro? And then I had a quick follow - up.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 49, "sub_chunk_id": 0, "sentences": "Timothy Cook: We think there were some impact across the products and in Services. Probably, the ones that we saw the most impact on were Mac and Wearables. You can see that in those numbers. And probably, the least would have been iPhone.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 50, "sub_chunk_id": 0, "sentences": "Krish Sankar: Got it. Got it. Very helpful, Tim. And then just a quick follow - up on the Mac. The PC industry is expecting a decline in PC shipments this year also. How do you think about the Mac relative to kind of like where the PC industry as a whole is expecting the shipments to end up? Is there any color you can give on that?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 51, "sub_chunk_id": 0, "sentences": "Timothy Cook: The industry is very challenged, as you say. It 's -- the industry is contracting. I think from us, though, is -- and I do n't know how this year will play out, so I do n't want to predict the year. But over the long run, we have a market that is a reasonable - sized market, a big market. And we have low share, and we have a competitive advantage with Apple silicon. And so strategically, I think we 're well positioned in the market, albeit I think it will be a little rough in the short term.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 52, "sub_chunk_id": 0, "sentences": "Tejas Gala: A replay of today 's call will be available for 2 weeks on Apple Podcasts, as a webcast on apple.com/investor and via telephone. The number for the telephone replay is 866 - 583 - 1035. Please enter confirmation code 6541285, followed by the pound sign. These replays will be available by approximately 5 p.m. Pacific Time today. Members of the press with additional questions can contact Josh Rosenstock at 408 - 862 - 1142. Financial analysts can contact me with additional questions at 669 - 227 - 2402. Thank you again for joining us.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AAPL", "quarter": 1, "year": 2023, "date": "2023-02-02 21:33:03", "chunk_id": 53, "sub_chunk_id": 0, "sentences": "Operator: And once again, this does conclude today 's conference. We do appreciate your participation.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Operator: Thank you for standing by. Good day, everyone, and welcome to the Amazon.com First Quarter 2024 Financial Results Teleconference. [Operator Instructions ] Today 's call is being recorded. \n And for opening remarks, I will be turning the call over to the Vice President of Investor Relations, Mr. Dave Fildes. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Dave Fildes: Hello, and welcome to our Q1 2024 financial results conference call. Joining us today to answer your questions is Andy Jassy, our CEO; and Brian Olsavsky, our CFO. As you listen to today 's conference call, we encourage you to have our press release in front of you, which includes our financial results as well as metrics and commentary on the quarter. Please note, unless otherwise stated, all comparisons in this call will be against our results for the comparable period of 2023. \n Our comments and responses to your questions reflect management 's views as of today, April 30, 2024, only, and will include forward - looking statements. Actual results may differ materially. Additional information about factors that could potentially impact our financial results is included in today 's press release and our filings with the SEC, including our most recent annual report on Form 10 - K and subsequent filings. \n During this call, we may discuss certain non - GAAP financial measures. In our press release, slides accompanying this webcast, and our filings with the SEC, each of which is posted on our IR website, you will find additional disclosures regarding these non - GAAP measures, including reconciliations of these measures with comparable GAAP measures. \n Our guidance incorporates the order trends that we ' ve seen to date and what we believe today to be appropriate assumptions. Our results are inherently unpredictable and may be materially affected by many factors, including fluctuations in foreign exchange rates, changes in global economic and geopolitical conditions and customer demand and spending, including the impact of recessionary fears, inflation, interest rates, regional labor market constraints, world events, the rate of growth of the Internet, online commerce, cloud services and new and emerging technologies, and the various factors detailed in our filings with the SEC. Our guidance assumes, among other things, that we do n't conclude any additional business acquisitions, restructurings or legal settlements. It 's not possible to accurately predict demand for our goods and services, and therefore, our actual results could differ materially from our guidance. \n And now I 'll turn the call over to Andy.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Andrew Jassy: Thanks, Dave. Today, we 're reporting $143.3 billion in revenue, up 13% year - over - year, excluding the impact from foreign exchange rates; $15.3 billion in operating income, up 221% year - over - year or $10.5 billion; and $48.8 billion in trailing 12 - month free cash flow adjusted for equipment finance leases, up $53.2 billion year - over - year. We remain focused on driving better experiences for our customers while also delivering efficiency improvements. Our financial results are an encouraging reminder of the progress we 're making. \n Starting with our stores business, despite having hundreds of millions of items and the broadest selection available, we remain intensely focused on adding even more selection. One way is to continue adding brands we know our customers want. For instance, in the U.S., we recently welcomed Clinique and 2 Gen Z fashion favorites, Parade and Cider, and announced a collaboration with Hardly Ever Worn It in Europe to offer customers pre - owned items from luxury brands. \n Another way to drive selection is to make it easier for our third - party sellers to add their products to our store. We ' ve recently launched a new generative AI tool that enables sellers to simply provide a URL to their own website, and we automatically create high - quality product detail pages on Amazon. Already, over 100,000 of our selling partners have used one or more of our gen AI tools. We remain focused on making sure we 're offering everyday low prices, which we know is even more important to our customers in this uncertain economic environment. \n As our results show, customers are shopping but remain cautious, trading down on price when they can and seeking out deals. In Q1, we helped customers save with shopping events worldwide, including our first big spring sale in Canada and the U.S. We also held spring deal days in Europe and our Ramadan event in Egypt, Saudi Arabia, and the UAE. Delivery speed really matters to customers, and we ' ve continued to get faster while improving our safety performance. In this past Q1, we delivered to Prime members at our fastest speeds ever. In March, across our top 60 largest U.S. metro areas, nearly 60% of Prime members orders arrived the same or next day. And globally, in cities like Toronto, London, and Tokyo, about 3 out of 4 items were delivered the same or next day. \n Faster delivery times have another important effect. As we get items to customers this fast, customers choose Amazon to fulfill their shopping needs more frequently, and we can see the results in various areas, including how fast our Everyday Essentials business is growing and the continued increase in Prime member purchase frequency and total spend with us. Over the past year, we ' ve talked about how our regionalization efforts have helped lower our cost to serve. We ' ve continued to inspect our fulfillment network for additional opportunities and are working on several areas where we believe we can lower costs even further while also improving customer experience. \n One example of this is our work to increase the consolidation of units into fewer boxes. As we further optimize our network, we ' ve seen an increase in the number of units delivered per box, an important driver for reducing our cost. When we 're able to consolidate more units into a box, it results in fewer boxes and deliveries, a better customer experience, reduces our cost to serve, and lowers our carbon impact. \n Another prominent example is our efforts to revamp our U.S. inbound fulfillment architecture to allow for better inventory placement closer to our customers. This will be an iterative process throughout the year as we work with sellers and retail partners, and teams are making good progress on their plans. \n Advertising performance remained strong, with ad sales up 24% year - over - year, excluding the impact of foreign exchange. The strength in advertising was primarily driven by sponsored products, supported by continued improvements in relevancy and measurement capabilities for advertisers. We still see significant opportunity ahead in our sponsored products as well as areas where we 're just getting started like Prime Video ads. Prime Video ads offers brands value as we can better link the impact of streaming TV advertising to business outcomes like product sales or subscription sign - ups, whether the brands sell on Amazon or not. It 's very early for streaming TV ads but we 're encouraged by the early response. \n Moving to AWS. Year - over - year revenue growth accelerated to 17.2% in Q1, up from 13.2% in Q4. It 's useful to remember that year - over - year percentages are only relevant relative to the total base from which you start. And given our much larger infrastructure cloud computing base, at this growth rate, we see more absolute dollar growth again quarter - over - quarter in AWS than we can see elsewhere. \n We 're seeing a few trends right now. First, companies have largely completed the lion 's share of their cost optimization and turned their attention to newer initiatives. Before the pandemic, companies were marching to modernize their infrastructure, moving from on - premises infrastructure to the cloud to save money, innovated at a more rapid rate, and to drive more developer productivity. The pandemic and uncertain economy that followed distracted from that momentum, but it 's picking up again. Companies are pursuing this relatively low - hanging fruit in modernizing their infrastructure. \n And with the broadest functionality by a fair bit, deepest partner ecosystem and strong security and operational performance, AWS continues to be their strong partner of choice. Our AWS customers are also quite excited about leveraging gen AI to change the customer experiences and businesses. We see considerable momentum on the AI front where we ' ve accumulated a multibillion - dollar revenue run rate already. \n You heard me talk about our approach before, and we continue to add capabilities at all 3 layers of the gen AI stack. At the bottom layer, which is for developers and companies building models themselves, we see excitement about our offerings. We have the broadest selection of NVIDIA compute instances around, but demand for our custom silicon, Trainium and Inferentia, is quite high given its favorable price performance benefits relative to available alternatives. Larger quantities of our latest generation Trainium2 is coming in the second half of 2024 and early 2025. \n Companies are also starting to talk about the eye - opening results they 're getting using SageMaker. Our managed end - to - end service has been a game changer for developers in preparing their data for AI, managing experiments, training models faster, lowering inference latency, and improving developer productivity. Perplexity.ai trains models 40% faster than SageMaker. Workday reduces inference latency by 80% with SageMaker, and NatWest reduces its time to value for AI from 12 to 18 months to under 7 months using SageMaker. This change is how challenging it is to build your own models, and we see an increasing number of model builders standardizing on SageMaker. \n The middle layer of the stack is for developers and companies who prefer not to build models from scratch but rather seek to leverage an existing large language model, or LLM, customize it with their own data and have the easiest and best features available to deploy secure high - quality, low - latency, cost - effective production gen AI apps. This is why we built Amazon Bedrock, which not only has the broadest selection of LLMs available to customers but also unusually compelling model evaluation, retrieval augmented generation, or RAG, to expand model 's knowledge base, guardrails to safeguard what questions applications will answer, agents to complete multistep tasks, and fine - tuning to keep teaching and refining models. \n Bedrock already has tens of thousands of customers, including adidas, New York Stock Exchange, Pfizer, Ryanair and Toyota. In the last few months, Bedrock 's added Anthropic 's Claude 3 models, the best - performing models in the planet right now; Meta 's Llama 3 models; Mistral 's various models, Cohere 's new models and new first - party Amazon Titan models. A week ago, Bedrock launched a series of other features, but perhaps most importantly, Custom Model Import. Custom Model Import is a sneaky big launch as it satisfies a customer request we ' ve heard frequently and that nobody has yet met. \n As increasingly more customers are using SageMaker to build their models, they 're wanting to take advantage of all the Bedrock features I mentioned earlier that make it so much easier to build high - quality production - grade gen AI apps. Bedrock Custom Model Import makes it simple to import models from SageMaker or elsewhere into Bedrock before deploying their applications. Customers are excited about this, and as more companies find they 're employing a mix of custom - built models along with leveraging existing LLMs, the prospect of these 2 linchpin services in SageMaker and Bedrock working well together is quite appealing. \n The top of the stack are the gen AI applications being built. And today, we announced the general availability of Amazon Q, the most capable generative AI - powered assistant for software development and leveraging company 's internal data. On the software development side, Q does n't just generate code. It also tests code, debugs coding conflicts, and transforms code from one form to another. Today, developers can save months using Q to move from older versions of Java to newer, more secure and capable ones. In the near future, Q will help developers transform their .NET code as well, helping them move from Windows to Linux. \n Q also has a unique capability called Agents, which can autonomously perform a range of tasks, everything from implementing features, documenting, and refactoring code to performing software upgrades. Developers can simply ask Amazon Q to implement an application feature such as asking it to create an add to favorites feature in a social sharing app, and the agent will analyze their existing application code and generate a step - by - step implementation plan, including code changes across multiple files and suggested new functions. Developers can collaborate with the agent to review and iterate on the plan, and then the agent implements it, connecting multiple steps together and applying updates across multiple files, code blocks and test suites. It 's quite handy. \n On the internal data side, most companies have large troves of internally relevant data that resides in wikis, Internet pages, Salesforce, storage repositories like Amazon S3 and a bevy of other data stores and SaaS apps that are hard to access. It makes answering straightforward questions about company policies, products, business results, code, people, and many other topics hard and frustrating. Q makes this much simpler. You can point Q at all of your enterprise data repositories and it will search all this data, summarize logically, analyze trends, engage in dialogue with customers about this data. \n We also introduced today a powerful new capability called Q Apps, which lets employees describe a natural language what apps they want to build on top of this internal data and Q Apps will quickly generate that app. This is going to make it so much easier for internal teams to build useful apps from their own data. \n Q is not only the most functionally capable AI - powered assistant for software development and data but also setting the standard for performance. Q has the highest - known score and acceptance rate for code suggestions, outperforms all other publicly benchmarkable competitors and catching security vulnerabilities, and leads all software development assistants on connecting multiple steps together and applying automatic actions. Customers are gravitating to Q, and we already see companies like Brightcove, British Telecom, Datadog, GitLab, GoDaddy, National Australia Bank, NCS, Netsmart, Slam, Smartsheet, Sun Life, Tata Consultancy Services, Toyota, and Wiz using Q, and we ' ve only been in beta until today. \n I 'd also caution folks not to overlook the security and operational performance elements of these gen AI services. It 's less sexy but critically important. Most companies care deeply about the privacy of the data in their AI applications and the reliability of their training and production apps. If you ' ve been paying attention to what 's been happening in the last year or so, you can see there are big differences between providers on these dimensions. AWS has a meaningful edge, which is adding to the number of companies moving their AI focus to AWS. \n We expect the combination of AWS ' reaccelerating growth and high demand for gen AI to meaningfully increase year - over - year capital expenditures in 2024, which given the way the AWS business model works is a positive sign of the future growth. The more demand AWS has, the more we have to procure new data centers, power and hardware. And as a reminder, we spend most of the capital upfront. But as you ' ve seen over the last several years, we make that up in operating margin and free cash flow down the road as demand steadies out. And we do n't spend the capital without very clear signals that we can monetize it this way. \n We remain very bullish on AWS. We 're at $100 billion - plus annualized revenue run rate, yet 85% or more of the global IT spend remains on - premises. And this is before you even calculate gen AI, most of which will be created over the next 10 to 20 years from scratch and on the cloud. There is a very large opportunity in front of us. We also continue to make strong progress on our newer investments. Our emerging international stores are growing and moving towards profitability. Our third - party logistics business offering services like Buy with Prime, Amazon shipping and multichannel fulfillment continues to grow well. \n We just launched a Prime delivery grocery benefit that lets customers receive free unlimited grocery delivery for just $9.99 a month, which is great value and customers are responding accordingly. Later this year in Manhattan, we 're launching a new smaller Whole Foods market concept called Whole Foods Market Daily Shops. Prime Video continues to produce compelling content, with Fallout being our latest big hit on the heels of a very successful Road House movie, with strong customer engagement in our original and partner content. \n Our health services business is growing robustly as customers are loving our pharmacy customer experience, and we ' ve launched same - day delivery of prescription medications to customers in 8 cities, including Los Angeles and New York City, with plans to expand to more than a dozen cities by the end of the year, with customers now getting first fill medications 75% faster year - over - year nationwide. And Kuiper is getting closer to having its production satellites in space and entering our commercial beta. \n There 's a lot of invention happening across our business, and I ' m super grateful to all our employees for their hard work and ingenuity. I 'll close by sharing that I ' m enthusiastic about how we started this year. We have a lot of opportunity in front of us in every one of our businesses to make our customers ' lives better and easier. \n With that, I 'll turn it over to Brian for a financial update.", "ground_truth_output": { "entities": [ { "id": 0, "label": "Value", "start_offset": 53, "end_offset": 67, "text": "$143.3 billion", "global_span": [ 2652, 2666 ] }, { "id": 1, "label": "Traditional", "start_offset": 71, "end_offset": 78, "text": "revenue", "global_span": [ 2670, 2677 ] }, { "id": 2, "label": "Value", "start_offset": 80, "end_offset": 85, "text": "up 13", "global_span": [ 2679, 2684 ] }, { "id": 3, "label": "Traditional", "start_offset": 85, "end_offset": 105, "text": "% year - over - year", "global_span": [ 2684, 2704 ] }, { "id": 4, "label": "Value", "start_offset": 157, "end_offset": 170, "text": "$15.3 billion", "global_span": [ 2756, 2769 ] }, { "id": 5, "label": "Traditional", "start_offset": 174, "end_offset": 190, "text": "operating income", "global_span": [ 2773, 2789 ] }, { "id": 6, "label": "Value", "start_offset": 195, "end_offset": 199, "text": "221%", "global_span": [ 2794, 2798 ] }, { "id": 7, "label": "Traditional", "start_offset": 200, "end_offset": 218, "text": "year - over - year", "global_span": [ 2799, 2817 ] }, { "id": 8, "label": "Value", "start_offset": 222, "end_offset": 235, "text": "$10.5 billion", "global_span": [ 2821, 2834 ] }, { "id": 9, "label": "Value", "start_offset": 241, "end_offset": 254, "text": "$48.8 billion", "global_span": [ 2840, 2853 ] }, { "id": 10, "label": "Traditional", "start_offset": 278, "end_offset": 330, "text": "free cash flow adjusted for equipment finance leases", "global_span": [ 2877, 2929 ] }, { "id": 11, "label": "Value", "start_offset": 335, "end_offset": 348, "text": "$53.2 billion", "global_span": [ 2934, 2947 ] }, { "id": 12, "label": "Traditional", "start_offset": 349, "end_offset": 367, "text": "year - over - year", "global_span": [ 2948, 2966 ] }, { "id": 13, "label": "Non_Traditional", "start_offset": 847, "end_offset": 864, "text": "welcomed Clinique", "global_span": [ 3446, 3463 ] }, { "id": 14, "label": "Non_Traditional", "start_offset": 869, "end_offset": 894, "text": "2 Gen Z fashion favorites", "global_span": [ 3468, 3493 ] }, { "id": 15, "label": "Value", "start_offset": 896, "end_offset": 902, "text": "Parade", "global_span": [ 3495, 3501 ] }, { "id": 16, "label": "Value", "start_offset": 907, "end_offset": 912, "text": "Cider", "global_span": [ 3506, 3511 ] }, { "id": 17, "label": "Non_Traditional", "start_offset": 918, "end_offset": 943, "text": "announced a collaboration", "global_span": [ 3517, 3542 ] }, { "id": 18, "label": "Non_Traditional", "start_offset": 949, "end_offset": 978, "text": "Hardly Ever Worn It in Europe", "global_span": [ 3548, 3577 ] }, { "id": 19, "label": "Non_Traditional", "start_offset": 1174, "end_offset": 1207, "text": "launched a new generative AI tool", "global_span": [ 3773, 3806 ] }, { "id": 20, "label": "Value", "start_offset": 1359, "end_offset": 1371, "text": "over 100,000", "global_span": [ 3958, 3970 ] }, { "id": 21, "label": "Non_Traditional", "start_offset": 1379, "end_offset": 1405, "text": "selling partners have used", "global_span": [ 3978, 4004 ] }, { "id": 22, "label": "Non_Traditional", "start_offset": 1421, "end_offset": 1437, "text": "our gen AI tools", "global_span": [ 4020, 4036 ] }, { "id": 23, "label": "Non_Traditional", "start_offset": 2092, "end_offset": 2118, "text": "delivered to Prime members", "global_span": [ 4691, 4717 ] }, { "id": 24, "label": "Value", "start_offset": 2126, "end_offset": 2145, "text": "fastest speeds ever", "global_span": [ 4725, 4744 ] }, { "id": 25, "label": "Value", "start_offset": 2208, "end_offset": 2211, "text": "60%", "global_span": [ 4807, 4810 ] }, { "id": 26, "label": "Non_Traditional", "start_offset": 2212, "end_offset": 2264, "text": "of Prime members orders arrived the same or next day", "global_span": [ 4811, 4863 ] }, { "id": 27, "label": "Value", "start_offset": 2329, "end_offset": 2345, "text": "3 out of 4 items", "global_span": [ 4928, 4944 ] }, { "id": 28, "label": "Non_Traditional", "start_offset": 2351, "end_offset": 2381, "text": "delivered the same or next day", "global_span": [ 4950, 4980 ] }, { "id": 29, "label": "Value", "start_offset": 3207, "end_offset": 3215, "text": "increase", "global_span": [ 5806, 5814 ] }, { "id": 30, "label": "Non_Traditional", "start_offset": 3223, "end_offset": 3256, "text": "number of units delivered per box", "global_span": [ 5822, 5855 ] }, { "id": 31, "label": "Traditional", "start_offset": 3845, "end_offset": 3853, "text": "ad sales", "global_span": [ 6444, 6452 ] }, { "id": 32, "label": "Value", "start_offset": 3854, "end_offset": 3860, "text": "up 24%", "global_span": [ 6453, 6459 ] }, { "id": 33, "label": "Traditional", "start_offset": 3861, "end_offset": 3921, "text": "year - over - year, excluding the impact of foreign exchange", "global_span": [ 6460, 6520 ] }, { "id": 34, "label": "Traditional", "start_offset": 4540, "end_offset": 4573, "text": "Year - over - year revenue growth", "global_span": [ 7139, 7172 ] }, { "id": 35, "label": "Value", "start_offset": 4589, "end_offset": 4594, "text": "17.2%", "global_span": [ 7188, 7193 ] }, { "id": 36, "label": "Traditional", "start_offset": 4595, "end_offset": 4600, "text": "in Q1", "global_span": [ 7194, 7199 ] }, { "id": 37, "label": "Value", "start_offset": 6469, "end_offset": 6478, "text": "Trainium2", "global_span": [ 9068, 9077 ] }, { "id": 38, "label": "Non_Traditional", "start_offset": 6482, "end_offset": 6530, "text": "coming in the second half of 2024 and early 2025", "global_span": [ 9081, 9129 ] }, { "id": 39, "label": "Non_Traditional", "start_offset": 9274, "end_offset": 9283, "text": "announced", "global_span": [ 11873, 11882 ] }, { "id": 40, "label": "Value", "start_offset": 9312, "end_offset": 9320, "text": "Amazon Q", "global_span": [ 11911, 11919 ] }, { "id": 41, "label": "Non_Traditional", "start_offset": 11236, "end_offset": 11252, "text": "introduced today", "global_span": [ 13835, 13851 ] }, { "id": 42, "label": "Value", "start_offset": 11286, "end_offset": 11292, "text": "Q Apps", "global_span": [ 13885, 13891 ] }, { "id": 43, "label": "Non_Traditional", "start_offset": 11696, "end_offset": 11697, "text": "Q", "global_span": [ 14295, 14296 ] }, { "id": 44, "label": "Value", "start_offset": 11706, "end_offset": 11713, "text": "highest", "global_span": [ 14305, 14312 ] }, { "id": 45, "label": "Non_Traditional", "start_offset": 11716, "end_offset": 11768, "text": "known score and acceptance rate for code suggestions", "global_span": [ 14315, 14367 ] }, { "id": 46, "label": "Value", "start_offset": 13508, "end_offset": 13527, "text": "$100 billion - plus", "global_span": [ 16107, 16126 ] }, { "id": 47, "label": "Traditional", "start_offset": 13528, "end_offset": 13555, "text": "annualized revenue run rate", "global_span": [ 16127, 16154 ] }, { "id": 48, "label": "Value", "start_offset": 13561, "end_offset": 13564, "text": "85%", "global_span": [ 16160, 16163 ] }, { "id": 49, "label": "Traditional", "start_offset": 13580, "end_offset": 13617, "text": "global IT spend remains on - premises", "global_span": [ 16179, 16216 ] }, { "id": 50, "label": "Value", "start_offset": 14108, "end_offset": 14116, "text": "launched", "global_span": [ 16707, 16715 ] }, { "id": 51, "label": "Non_Traditional", "start_offset": 14119, "end_offset": 14149, "text": "Prime delivery grocery benefit", "global_span": [ 16718, 16748 ] }, { "id": 52, "label": "Value", "start_offset": 14334, "end_offset": 14343, "text": "launching", "global_span": [ 16933, 16942 ] }, { "id": 53, "label": "Non_Traditional", "start_offset": 14392, "end_offset": 14422, "text": "Whole Foods Market Daily Shops", "global_span": [ 16991, 17021 ] }, { "id": 54, "label": "Value", "start_offset": 14758, "end_offset": 14766, "text": "launched", "global_span": [ 17357, 17365 ] }, { "id": 55, "label": "Non_Traditional", "start_offset": 14767, "end_offset": 14830, "text": "same - day delivery of prescription medications to customers in", "global_span": [ 17366, 17429 ] }, { "id": 56, "label": "Value", "start_offset": 14831, "end_offset": 14839, "text": "8 cities", "global_span": [ 17430, 17438 ] }, { "id": 57, "label": "Non_Traditional", "start_offset": 14982, "end_offset": 15004, "text": "first fill medications", "global_span": [ 17581, 17603 ] }, { "id": 58, "label": "Value", "start_offset": 15005, "end_offset": 15008, "text": "75%", "global_span": [ 17604, 17607 ] }, { "id": 59, "label": "Non_Traditional", "start_offset": 15009, "end_offset": 15045, "text": "faster year - over - year nationwide", "global_span": [ 17608, 17644 ] }, { "id": 217, "label": "Traditional", "text": "trailing 12 - month ", "start_offset": 258, "end_offset": 278, "global_span": [ 2857, 2877 ] }, { "id": 218, "label": "non_traditional", "text": "past Q1", "start_offset": 2080, "end_offset": 2087, "global_span": [ 4679, 4686 ] }, { "id": 219, "label": "Traditional", "text": "13.2%", "start_offset": 4610, "end_offset": 4615, "global_span": [ 7209, 7214 ] }, { "id": 220, "label": "Traditional", "text": "Q4", "start_offset": 4619, "end_offset": 4621, "global_span": [ 7218, 7220 ] }, { "id": 221, "label": "non_traditional", "text": "today", "start_offset": 9264, "end_offset": 9269, "global_span": [ 11863, 11868 ] } ], "relations": [ { "id": 1, "entity_ids": [ 0, 1 ], "description": "Value_of" }, { "id": 2, "entity_ids": [ 1, 2, 3 ], "description": "Value_of" }, { "id": 3, "entity_ids": [ 4, 5 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 5, 6, 7 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 5, 7, 8 ], "description": "up 221%[6] year - over - year[7] or $10.5 billion[8]" }, { "id": 6, "entity_ids": [ 9 ], "description": "value_of" }, { "id": 7, "entity_ids": [ 10, 11, 12 ], "description": "value_of" }, { "id": 8, "entity_ids": [ 13, 14, 15, 16 ], "description": "value_of" }, { "id": 9, "entity_ids": [ 17, 18 ], "description": "value_of" }, { "id": 10, "entity_ids": [ 20, 21, 22 ], "description": "value_of" }, { "id": 11, "entity_ids": [ 23, 24 ], "description": "value_of" }, { "id": 12, "entity_ids": [ 25, 26 ], "description": "value_of" }, { "id": 13, "entity_ids": [ 27, 28 ], "description": "value_of" }, { "id": 14, "entity_ids": [ 29, 30 ], "description": "value_of" }, { "id": 15, "entity_ids": [ 31, 32, 33 ], "description": "value_of" }, { "id": 16, "entity_ids": [ 34, 35, 36 ], "description": "value_of" }, { "id": 17, "entity_ids": [ 37, 38 ], "description": "value_of" }, { "id": 18, "entity_ids": [ 39, 40 ], "description": "value_of" }, { "id": 19, "entity_ids": [ 41, 42 ], "description": "value_of" }, { "id": 20, "entity_ids": [ 43, 44, 45 ], "description": "value_of" }, { "id": 21, "entity_ids": [ 46, 47 ], "description": "value_of" }, { "id": 22, "entity_ids": [ 48, 49 ], "description": "value_of" }, { "id": 23, "entity_ids": [ 50, 51 ], "description": "value_of" }, { "id": 24, "entity_ids": [ 52, 53 ], "description": "value_of" }, { "id": 25, "entity_ids": [ 54, 55, 56 ], "description": "value_of" }, { "id": 26, "entity_ids": [ 57, 58, 59 ], "description": "value_of" }, { "id": 84, "entity_ids": [ 23, 24, 218 ], "description": "Value_of" }, { "id": 85, "entity_ids": [ 34, 219, 220 ], "description": "Value_of" }, { "id": 86, "entity_ids": [ 39, 40, 221 ], "description": "Value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Brian Olsavsky: Thanks, Andy. Starting with our top line financial results. Worldwide revenue was $143.3 billion, representing a 13% increase year - over - year, excluding the impact of foreign exchange and near the top end of our guidance range. I 'd like to highlight a couple of points to help you interpret our growth rates. First, we saw an impact from leap year in Q1, which added approximately 120 basis points to the year - over - year quarterly revenue growth rate. \n Second, while I typically talk about growth rates, excluding the impact of year - over - year changes in foreign exchange, we did see an unfavorable impact from global currencies weakening against the U.S. dollar, more than we had planned in Q1. This led to a $700 million or 50 basis point headwind to revenue relative to what we guided. Excluding this FX headwind, we would have exceeded the top end of our guidance range. Worldwide operating income was $15.3 billion, which was our highest quarterly income ever, and it was $3.3 billion above the high end of our guidance range. \n This was driven by strong operational performance across all 3 reportable segments and better - than - expected operating leverage, including lower cost to serve. The impact on operating income from our Q1 FX rate headwind was negligible. I 'll speak more to our profitability trends in a moment. In the North America segment, first quarter revenue was $86.3 billion, an increase of 12% year - over - year. In the international segment, revenue was $31.9 billion, an increase of 11% year - over - year, excluding the impact of foreign exchange.", "ground_truth_output": { "entities": [ { "id": 60, "label": "Traditional", "start_offset": 77, "end_offset": 94, "text": "Worldwide revenue", "global_span": [ 18242, 18259 ] }, { "id": 61, "label": "Value", "start_offset": 99, "end_offset": 113, "text": "$143.3 billion", "global_span": [ 18264, 18278 ] }, { "id": 62, "label": "Value", "start_offset": 130, "end_offset": 133, "text": "13%", "global_span": [ 18295, 18298 ] }, { "id": 63, "label": "Traditional", "start_offset": 134, "end_offset": 161, "text": "increase year - over - year", "global_span": [ 18299, 18326 ] }, { "id": 64, "label": "Value", "start_offset": 402, "end_offset": 418, "text": "120 basis points", "global_span": [ 18567, 18583 ] }, { "id": 65, "label": "Traditional", "start_offset": 426, "end_offset": 474, "text": "year - over - year quarterly revenue growth rate", "global_span": [ 18591, 18639 ] }, { "id": 66, "label": "Value", "start_offset": 739, "end_offset": 751, "text": "$700 million", "global_span": [ 18904, 18916 ] }, { "id": 67, "label": "Value", "start_offset": 755, "end_offset": 769, "text": "50 basis point", "global_span": [ 18920, 18934 ] }, { "id": 68, "label": "Traditional", "start_offset": 770, "end_offset": 816, "text": "headwind to revenue relative to what we guided", "global_span": [ 18935, 18981 ] }, { "id": 69, "label": "Traditional", "start_offset": 904, "end_offset": 930, "text": "Worldwide operating income", "global_span": [ 19069, 19095 ] }, { "id": 70, "label": "Value", "start_offset": 935, "end_offset": 948, "text": "$15.3 billion", "global_span": [ 19100, 19113 ] }, { "id": 71, "label": "Value", "start_offset": 964, "end_offset": 971, "text": "highest", "global_span": [ 19129, 19136 ] }, { "id": 72, "label": "Traditional", "start_offset": 972, "end_offset": 993, "text": "quarterly income ever", "global_span": [ 19137, 19158 ] }, { "id": 73, "label": "Value", "start_offset": 1006, "end_offset": 1018, "text": "$3.3 billion", "global_span": [ 19171, 19183 ] }, { "id": 74, "label": "Traditional", "start_offset": 1019, "end_offset": 1059, "text": "above the high end of our guidance range", "global_span": [ 19184, 19224 ] }, { "id": 75, "label": "Traditional", "start_offset": 1368, "end_offset": 1381, "text": "North America", "global_span": [ 19533, 19546 ] }, { "id": 76, "label": "Traditional", "start_offset": 1391, "end_offset": 1412, "text": "first quarter revenue", "global_span": [ 19556, 19577 ] }, { "id": 77, "label": "Value", "start_offset": 1417, "end_offset": 1430, "text": "$86.3 billion", "global_span": [ 19582, 19595 ] }, { "id": 78, "label": "Traditional", "start_offset": 1435, "end_offset": 1443, "text": "increase", "global_span": [ 19600, 19608 ] }, { "id": 79, "label": "Value", "start_offset": 1447, "end_offset": 1450, "text": "12%", "global_span": [ 19612, 19615 ] }, { "id": 80, "label": "Traditional", "start_offset": 1451, "end_offset": 1469, "text": "year - over - year", "global_span": [ 19616, 19634 ] }, { "id": 81, "label": "Traditional", "start_offset": 1478, "end_offset": 1499, "text": "international segment", "global_span": [ 19643, 19664 ] }, { "id": 82, "label": "Value", "start_offset": 1513, "end_offset": 1526, "text": "$31.9 billion", "global_span": [ 19678, 19691 ] }, { "id": 83, "label": "Traditional", "start_offset": 1531, "end_offset": 1539, "text": "increase", "global_span": [ 19696, 19704 ] }, { "id": 84, "label": "Value", "start_offset": 1543, "end_offset": 1546, "text": "11%", "global_span": [ 19708, 19711 ] }, { "id": 85, "label": "Traditional", "start_offset": 1547, "end_offset": 1565, "text": "year - over - year", "global_span": [ 19712, 19730 ] }, { "id": 86, "label": "Traditional", "start_offset": 1567, "end_offset": 1607, "text": "excluding the impact of foreign exchange", "global_span": [ 19732, 19772 ] } ], "relations": [ { "id": 27, "entity_ids": [ 60, 61 ], "description": "value_of" }, { "id": 28, "entity_ids": [ 60, 62, 63 ], "description": "value_of" }, { "id": 29, "entity_ids": [ 64, 65 ], "description": "value_of" }, { "id": 30, "entity_ids": [ 60, 66, 68 ], "description": "value_of" }, { "id": 31, "entity_ids": [ 60, 67, 68 ], "description": "value_of" }, { "id": 32, "entity_ids": [ 69, 70 ], "description": "value_of" }, { "id": 33, "entity_ids": [ 69, 71, 72 ], "description": "value_of" }, { "id": 34, "entity_ids": [ 69, 73, 74 ], "description": "value_of" }, { "id": 35, "entity_ids": [ 75, 76, 77 ], "description": "value_of" }, { "id": 36, "entity_ids": [ 75, 76, 78, 79, 80 ], "description": "value_of" }, { "id": 37, "entity_ids": [ 76, 81, 82 ], "description": "value_of" }, { "id": 38, "entity_ids": [ 76, 81, 83, 84, 85 ], "description": "value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "We remain focused on the inputs that matter most to our customers: selection, price, and convenience. During the quarter, around the world, we helped customers save with our shopping events. We added selection, including premium and luxury brands, and we delivered our fastest speeds ever for Prime members. Third - party sellers continue to be an important part of our offering. Third - party seller services revenue increased 16% year - over - year, excluding the impact of foreign exchange. We saw strong 3P unit growth, coupled with increased adoption of our optional services, such as fulfillment and global logistics. For the quarter, third - party seller unit mix was 61%, up 200 basis points year - over - year. \n Shifting to profitability, North America segment operating income was $5 billion, an increase of $4.1 billion year - over - year. Operating margin was 5.8%, up 460 basis points year - over - year. We saw improvements in our cost to serve, including continued benefit from our work to regionalize our operations, savings from more consolidated customer shipments, and improved leverage driven by strong unit growth and lower transportation rates. In our international segment, operating income was $903 million, an improvement of $2.2 billion year - over - year. Operating margin was 2.8%, up 710 basis points year - over - year. This is primarily driven by our established countries as we improve cost efficiencies through network design enhancements and improved volume leverage. Additionally, we saw good progress in our emerging countries as they expand their customer offerings and make strides on their respective journeys to profitability. \n Looking ahead, we see several opportunities to further lower cost to serve and improved profitability in our worldwide stores business while still investing to improve the customer experience. Within our fulfillment network, we are focused on investing in our inbound network, streamlining and standardizing process paths, and adding robotics and automation. These improvement opportunities will take time. However, we have a solid plan in place and we like the path we 're on. Advertising remains an important contributor to profitability in North America and international segments. We see many opportunities to grow our offerings, both in the areas that are driving growth today like sponsored products and in areas that are newer, like streaming TV ads. \n Moving to AWS. Revenue was $25 billion, an increase of 17% year - over - year, and AWS is now a $100 billion annualized revenue run rate business. Excluding the impact from leap year, AWS revenue increased approximately 16% year - over - year. During the first quarter, we saw growth in both generative AI and non - generative AI workloads across a diverse group of customers and across industries as companies are shifting their focus towards driving innovation and bringing new workloads to the cloud. \n Additionally, we continue to see the impact of cost optimizations diminish. While there always be a level of ongoing optimization, we think the majority of the recent cycle is behind us, and we 're likely closer to a steady state of these optimization efforts. AWS operating income was $9.4 billion, an increase of $4.3 billion year - over - year. As a reminder, these results include the impact from the change in the estimated useful life of our servers, which primarily benefits the AWS segment. We made progress in managing our infrastructure and fixed costs while still growing at a healthy rate, which has resulted in improved leverage. \n As we ' ve said in the past, over time, we expect the AWS operating margins to fluctuate, driven in part by the level of investments we are making in the business. We remain focused on driving efficiencies across the business, which enables us to invest to support the strong growth we 're seeing in AWS, including generative AI, which brings us to capital investments. As a reminder, we define these as the combination of CapEx plus equipment finance leases. In 2023, overall capital investments were $48.4 billion. As I mentioned, we 're seeing strong AWS demand in both generative AI and our non - generative AI workloads, with customers signing up for longer deals and making bigger commitments. It 's still relatively early days in generative AI and more broadly, the cloud space, and we see sizable opportunity for growth. We anticipate our overall capital expenditures to meaningfully increase year - over - year in 2024, primarily driven by higher infrastructure CapEx to support growth in AWS, including generative AI. \n Turning to our revenue guidance for Q2. Net sales are expected to be between $144 billion and $149 billion or to grow between 7% and 11% compared with the second quarter of 2023. We saw an unfavorable impact from year - over - year changes in foreign exchange in our Q1 results, and we expect that headwind to grow in the second quarter. Our Q2 net sales guidance anticipates an unfavorable foreign exchange impact of approximately 60 basis points. As part of our guidance considerations, we also continue to keep an eye on consumer spending and macro level trends, specifically in Europe where it appears to be a bit weaker relative to the U.S. Operating income is expected to be between $10 billion and $14 billion in Q2. This estimate includes the impact of our seasonal step - up in stock - based compensation expense, driven by the timing of our annual compensation cycle. \n I want to thank our customers, our partners, and our teammates around the world for a very strong start to the year, and we 're excited to build on this momentum. We 'll remain focused on streamlining and prioritizing projects in a way that allows us to continue inventing for customers in a cost - effective way. With that, let 's move on to your questions.", "ground_truth_output": { "entities": [ { "id": 87, "label": "Non_Traditional", "start_offset": 258, "end_offset": 271, "text": "delivered our", "global_span": [ 20032, 20045 ] }, { "id": 88, "label": "Value", "start_offset": 272, "end_offset": 291, "text": "fastest speeds ever", "global_span": [ 20046, 20065 ] }, { "id": 89, "label": "Non_Traditional", "start_offset": 292, "end_offset": 309, "text": "for Prime members", "global_span": [ 20066, 20083 ] }, { "id": 90, "label": "Traditional", "start_offset": 383, "end_offset": 388, "text": "Third", "global_span": [ 20157, 20162 ] }, { "id": 91, "label": "Traditional", "start_offset": 391, "end_offset": 420, "text": "party seller services revenue", "global_span": [ 20165, 20194 ] }, { "id": 92, "label": "Value", "start_offset": 431, "end_offset": 434, "text": "16%", "global_span": [ 20205, 20208 ] }, { "id": 93, "label": "Traditional", "start_offset": 435, "end_offset": 453, "text": "year - over - year", "global_span": [ 20209, 20227 ] }, { "id": 94, "label": "Traditional", "start_offset": 455, "end_offset": 495, "text": "excluding the impact of foreign exchange", "global_span": [ 20229, 20269 ] }, { "id": 95, "label": "Value", "start_offset": 504, "end_offset": 510, "text": "strong", "global_span": [ 20278, 20284 ] }, { "id": 96, "label": "Traditional", "start_offset": 511, "end_offset": 525, "text": "3P unit growth", "global_span": [ 20285, 20299 ] }, { "id": 97, "label": "Value", "start_offset": 540, "end_offset": 549, "text": "increased", "global_span": [ 20314, 20323 ] }, { "id": 98, "label": "Traditional", "start_offset": 550, "end_offset": 583, "text": "adoption of our optional services", "global_span": [ 20324, 20357 ] }, { "id": 99, "label": "Value", "start_offset": 678, "end_offset": 681, "text": "61%", "global_span": [ 20452, 20455 ] }, { "id": 100, "label": "Value", "start_offset": 686, "end_offset": 702, "text": "200 basis points", "global_span": [ 20460, 20476 ] }, { "id": 101, "label": "Traditional", "start_offset": 703, "end_offset": 721, "text": "year - over - year", "global_span": [ 20477, 20495 ] }, { "id": 102, "label": "Traditional", "start_offset": 738, "end_offset": 751, "text": "profitability", "global_span": [ 20512, 20525 ] }, { "id": 103, "label": "Traditional", "start_offset": 753, "end_offset": 791, "text": "North America segment operating income", "global_span": [ 20527, 20565 ] }, { "id": 104, "label": "Value", "start_offset": 796, "end_offset": 806, "text": "$5 billion", "global_span": [ 20570, 20580 ] }, { "id": 105, "label": "Traditional", "start_offset": 811, "end_offset": 819, "text": "increase", "global_span": [ 20585, 20593 ] }, { "id": 106, "label": "Value", "start_offset": 823, "end_offset": 835, "text": "$4.1 billion", "global_span": [ 20597, 20609 ] }, { "id": 107, "label": "Traditional", "start_offset": 836, "end_offset": 854, "text": "year - over - year", "global_span": [ 20610, 20628 ] }, { "id": 108, "label": "Traditional", "start_offset": 856, "end_offset": 872, "text": "Operating margin", "global_span": [ 20630, 20646 ] }, { "id": 109, "label": "Value", "start_offset": 877, "end_offset": 881, "text": "5.8%", "global_span": [ 20651, 20655 ] }, { "id": 110, "label": "Traditional", "start_offset": 883, "end_offset": 885, "text": "up", "global_span": [ 20657, 20659 ] }, { "id": 111, "label": "Value", "start_offset": 886, "end_offset": 889, "text": "460", "global_span": [ 20660, 20663 ] }, { "id": 112, "label": "Traditional", "start_offset": 890, "end_offset": 921, "text": "basis points year - over - year", "global_span": [ 20664, 20695 ] }, { "id": 113, "label": "Traditional", "start_offset": 1179, "end_offset": 1200, "text": "international segment", "global_span": [ 20953, 20974 ] }, { "id": 114, "label": "Traditional", "start_offset": 1202, "end_offset": 1218, "text": "operating income", "global_span": [ 20976, 20992 ] }, { "id": 115, "label": "Value", "start_offset": 1223, "end_offset": 1235, "text": "$903 million", "global_span": [ 20997, 21009 ] }, { "id": 116, "label": "Traditional", "start_offset": 1240, "end_offset": 1251, "text": "improvement", "global_span": [ 21014, 21025 ] }, { "id": 117, "label": "Value", "start_offset": 1255, "end_offset": 1267, "text": "$2.2 billion", "global_span": [ 21029, 21041 ] }, { "id": 118, "label": "Traditional", "start_offset": 1268, "end_offset": 1286, "text": "year - over - year", "global_span": [ 21042, 21060 ] }, { "id": 119, "label": "Traditional", "start_offset": 1288, "end_offset": 1304, "text": "Operating margin", "global_span": [ 21062, 21078 ] }, { "id": 120, "label": "Value", "start_offset": 1309, "end_offset": 1313, "text": "2.8%", "global_span": [ 21083, 21087 ] }, { "id": 121, "label": "Traditional", "start_offset": 1315, "end_offset": 1317, "text": "up", "global_span": [ 21089, 21091 ] }, { "id": 122, "label": "Value", "start_offset": 1318, "end_offset": 1321, "text": "710", "global_span": [ 21092, 21095 ] }, { "id": 123, "label": "Traditional", "start_offset": 1322, "end_offset": 1353, "text": "basis points year - over - year", "global_span": [ 21096, 21127 ] }, { "id": 124, "label": "Traditional", "start_offset": 2451, "end_offset": 2458, "text": "Revenue", "global_span": [ 22225, 22232 ] }, { "id": 125, "label": "Value", "start_offset": 2463, "end_offset": 2474, "text": "$25 billion", "global_span": [ 22237, 22248 ] }, { "id": 126, "label": "Traditional", "start_offset": 2479, "end_offset": 2487, "text": "increase", "global_span": [ 22253, 22261 ] }, { "id": 127, "label": "Value", "start_offset": 2491, "end_offset": 2494, "text": "17%", "global_span": [ 22265, 22268 ] }, { "id": 128, "label": "Traditional", "start_offset": 2495, "end_offset": 2513, "text": "year - over - year", "global_span": [ 22269, 22287 ] }, { "id": 129, "label": "Value", "start_offset": 2532, "end_offset": 2544, "text": "$100 billion", "global_span": [ 22306, 22318 ] }, { "id": 130, "label": "Traditional", "start_offset": 2545, "end_offset": 2572, "text": "annualized revenue run rate", "global_span": [ 22319, 22346 ] }, { "id": 131, "label": "Traditional", "start_offset": 2583, "end_offset": 2618, "text": "Excluding the impact from leap year", "global_span": [ 22357, 22392 ] }, { "id": 132, "label": "Traditional", "start_offset": 2620, "end_offset": 2641, "text": "AWS revenue increased", "global_span": [ 22394, 22415 ] }, { "id": 133, "label": "Value", "start_offset": 2642, "end_offset": 2659, "text": "approximately 16%", "global_span": [ 22416, 22433 ] }, { "id": 134, "label": "Traditional", "start_offset": 2660, "end_offset": 2678, "text": "year - over - year", "global_span": [ 22434, 22452 ] }, { "id": 135, "label": "Traditional", "start_offset": 2691, "end_offset": 2704, "text": "first quarter", "global_span": [ 22465, 22478 ] }, { "id": 136, "label": "Traditional", "start_offset": 2713, "end_offset": 2719, "text": "growth", "global_span": [ 22487, 22493 ] }, { "id": 137, "label": "Value", "start_offset": 2728, "end_offset": 2741, "text": "generative AI", "global_span": [ 22502, 22515 ] }, { "id": 138, "label": "Traditional", "start_offset": 3204, "end_offset": 3224, "text": "AWS operating income", "global_span": [ 22978, 22998 ] }, { "id": 139, "label": "Value", "start_offset": 3229, "end_offset": 3241, "text": "$9.4 billion", "global_span": [ 23003, 23015 ] }, { "id": 140, "label": "Traditional", "start_offset": 3246, "end_offset": 3254, "text": "increase", "global_span": [ 23020, 23028 ] }, { "id": 141, "label": "Value", "start_offset": 3258, "end_offset": 3270, "text": "$4.3 billion", "global_span": [ 23032, 23044 ] }, { "id": 142, "label": "Traditional", "start_offset": 3271, "end_offset": 3289, "text": "year - over - year", "global_span": [ 23045, 23063 ] }, { "id": 143, "label": "Traditional", "start_offset": 3632, "end_offset": 3638, "text": "expect", "global_span": [ 23406, 23412 ] }, { "id": 144, "label": "Traditional", "start_offset": 3643, "end_offset": 3667, "text": "AWS operating margins to", "global_span": [ 23417, 23441 ] }, { "id": 145, "label": "Value", "start_offset": 3668, "end_offset": 3677, "text": "fluctuate", "global_span": [ 23442, 23451 ] }, { "id": 146, "label": "Traditional", "start_offset": 4052, "end_offset": 4056, "text": "2023", "global_span": [ 23826, 23830 ] }, { "id": 147, "label": "Traditional", "start_offset": 4058, "end_offset": 4085, "text": "overall capital investments", "global_span": [ 23832, 23859 ] }, { "id": 148, "label": "Value", "start_offset": 4091, "end_offset": 4104, "text": "$48.4 billion", "global_span": [ 23865, 23878 ] }, { "id": 149, "label": "Traditional", "start_offset": 4421, "end_offset": 4464, "text": "anticipate our overall capital expenditures", "global_span": [ 24195, 24238 ] }, { "id": 150, "label": "Traditional", "start_offset": 4468, "end_offset": 4480, "text": "meaningfully", "global_span": [ 24242, 24254 ] }, { "id": 151, "label": "Value", "start_offset": 4481, "end_offset": 4489, "text": "increase", "global_span": [ 24255, 24263 ] }, { "id": 152, "label": "Traditional", "start_offset": 4490, "end_offset": 4508, "text": "year - over - year", "global_span": [ 24264, 24282 ] }, { "id": 153, "label": "Traditional", "start_offset": 4512, "end_offset": 4516, "text": "2024", "global_span": [ 24286, 24290 ] }, { "id": 154, "label": "Traditional", "start_offset": 4660, "end_offset": 4669, "text": "Net sales", "global_span": [ 24434, 24443 ] }, { "id": 155, "label": "Traditional", "start_offset": 4674, "end_offset": 4682, "text": "expected", "global_span": [ 24448, 24456 ] }, { "id": 156, "label": "Value", "start_offset": 4697, "end_offset": 4726, "text": "$144 billion and $149 billion", "global_span": [ 24471, 24500 ] }, { "id": 157, "label": "Traditional", "start_offset": 4733, "end_offset": 4737, "text": "grow", "global_span": [ 24507, 24511 ] }, { "id": 158, "label": "Value", "start_offset": 4746, "end_offset": 4756, "text": "7% and 11%", "global_span": [ 24520, 24530 ] }, { "id": 159, "label": "Traditional", "start_offset": 4757, "end_offset": 4765, "text": "compared", "global_span": [ 24531, 24539 ] }, { "id": 160, "label": "Traditional", "start_offset": 4775, "end_offset": 4797, "text": "second quarter of 2023", "global_span": [ 24549, 24571 ] }, { "id": 161, "label": "Traditional", "start_offset": 4965, "end_offset": 4995, "text": "net sales guidance anticipates", "global_span": [ 24739, 24769 ] }, { "id": 162, "label": "Traditional", "start_offset": 4999, "end_offset": 5037, "text": "unfavorable foreign exchange impact of", "global_span": [ 24773, 24811 ] }, { "id": 163, "label": "Value", "start_offset": 5038, "end_offset": 5067, "text": "approximately 60 basis points", "global_span": [ 24812, 24841 ] }, { "id": 164, "label": "Value", "start_offset": 5309, "end_offset": 5320, "text": "$10 billion", "global_span": [ 25083, 25094 ] }, { "id": 165, "label": "Value", "start_offset": 5325, "end_offset": 5336, "text": "$14 billion", "global_span": [ 25099, 25110 ] }, { "id": 222, "label": "Traditional", "text": "Q2", "start_offset": 4656, "end_offset": 4658, "global_span": [ 24430, 24432 ] }, { "id": 223, "label": "Traditional", "text": "Q2 ", "start_offset": 4962, "end_offset": 4965, "global_span": [ 24736, 24739 ] }, { "id": 224, "label": "Traditional", "text": "Q2", "start_offset": 5340, "end_offset": 5342, "global_span": [ 25114, 25116 ] } ], "relations": [ { "id": 39, "entity_ids": [ 87, 88, 89 ], "description": "value_of" }, { "id": 40, "entity_ids": [ 90, 91, 92, 93, 94 ], "description": "value_of" }, { "id": 41, "entity_ids": [ 95, 96 ], "description": "value_of" }, { "id": 42, "entity_ids": [ 97, 98 ], "description": "value_of" }, { "id": 43, "entity_ids": [ 99 ], "description": "value_of" }, { "id": 44, "entity_ids": [ 100, 101 ], "description": "value_of" }, { "id": 45, "entity_ids": [ 102, 103, 104 ], "description": "value_of" }, { "id": 46, "entity_ids": [ 103, 105, 106, 107 ], "description": "value_of" }, { "id": 47, "entity_ids": [ 108, 109 ], "description": "value_of" }, { "id": 48, "entity_ids": [ 108, 110, 111, 112 ], "description": "value_of" }, { "id": 49, "entity_ids": [ 113, 114, 115 ], "description": "value_of" }, { "id": 50, "entity_ids": [ 113, 114, 116, 117, 118 ], "description": "value_of" }, { "id": 51, "entity_ids": [ 119, 120 ], "description": "value_of" }, { "id": 52, "entity_ids": [ 119, 121, 122, 123 ], "description": "value_of" }, { "id": 53, "entity_ids": [ 124, 125 ], "description": "value_of" }, { "id": 54, "entity_ids": [ 124, 126, 127, 128 ], "description": "value_of" }, { "id": 55, "entity_ids": [ 124, 125 ], "description": "value_of" }, { "id": 56, "entity_ids": [ 124, 126, 127, 128 ], "description": "value_of" }, { "id": 57, "entity_ids": [ 129, 130, 131 ], "description": "value_of" }, { "id": 58, "entity_ids": [ 132, 133, 134 ], "description": "value_of" }, { "id": 59, "entity_ids": [ 135, 136, 137 ], "description": "value_of" }, { "id": 60, "entity_ids": [ 138, 139 ], "description": "value_of" }, { "id": 61, "entity_ids": [ 138, 140, 141, 142 ], "description": "value_of" }, { "id": 62, "entity_ids": [ 143, 144, 145 ], "description": "value_of" }, { "id": 63, "entity_ids": [ 146, 147, 148 ], "description": "value_of" }, { "id": 64, "entity_ids": [ 149, 150, 151, 152, 153 ], "description": "value_of" }, { "id": 65, "entity_ids": [ 154, 155, 156 ], "description": "value_of" }, { "id": 66, "entity_ids": [ 154, 155, 157, 158, 159, 160 ], "description": "value_of" }, { "id": 67, "entity_ids": [ 161, 162, 163 ], "description": "value_of" }, { "id": 68, "entity_ids": [ 164, 165 ], "description": "value_of" }, { "id": 87, "entity_ids": [ 154, 155, 156, 222 ], "description": "Value_of" }, { "id": 88, "entity_ids": [ 154, 155, 157, 158, 159, 160, 222 ], "description": "Value_of" }, { "id": 89, "entity_ids": [ 161, 162, 163, 223 ], "description": "Value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Operator: [Operator Instructions ] Our first question comes from the line of Doug Anmuth with JPMorgan.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "Douglas Anmuth: Probably for both Andy and Brian. Historically, Amazon has shifted between periods of heavy investment and then margin expansion back into heavier investment, but you now have a much bigger base of gross profit and overall operating income. As you think about gen AI and capital intensity or grocery or Kuiper or health care, is there anything from an investment perspective that could materially impact profitability going forward in your view?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Brian Olsavsky: Doug, yes, we have historically always mentioned that. You have seen like a pendulum shift sometimes between profitability and investment. I think we 're at the stage now where we 're doing both at the same time continually, so we are more apt to talk about the specific investments that we 're making and how that might impact our short - term outlook. So if you look at the progress we ' ve made on operating income and free cash flow over really the last 18 months, a lot of it 's driven by improvements in our stores business, lower cost to serve. We ' ve talked about regionalization efforts and how that 's moving into inbound areas now. \n Advertising has been growing strong and AWS has been strong. And you saw AWS margins increased 800 basis points sequentially off Q4. A lot of that 's driven by cost controls and expanding revenue on the top line and lower cost structure throughout the company. We do see, though, on the CapEx side that we will be meaningfully stepping up our CapEx and the majority of that will be in our -- to support AWS infrastructure and specifically generative AI efforts. So I would expect that, that will increase -- it will increase depreciation, definitely in that segment. \n On the -- well, we 're talking about CapEx. Right now, in Q1, we had $14 billion of CapEx. We expect that to be the low quarter for the year. As Andy said earlier, we are seeing strong demand signals from our customers and longer deals and larger commitments, many with generative AI components. So those signals are giving us confidence in our expansion of capital in this area. \n And as he also mentioned, we ' ve done this for 18 years. We invest capital and resources upfront. We create capacity very carefully for our customers. And then we see the revenue, operating income and free cash flow benefit for years to come after that, with strong returns on invested capital. So a little bit of a long - winded answer to your question. But yes, we have -- the main issue that we 'll see in the near term is additional CapEx and we ' ve talked about that. \n And we continue to see strong CapEx performance in our stores business. Most of that will be related to modest capital or capacity increases, in addition to our same - day fulfillment network and some Amazon Logistics upgrades to the fleet. But for the most part, what you 'll see is really going to be on the AWS side.", "ground_truth_output": { "entities": [ { "id": 166, "label": "Traditional", "start_offset": 737, "end_offset": 758, "text": "AWS margins increased", "global_span": [ 26936, 26957 ] }, { "id": 167, "label": "Value", "start_offset": 759, "end_offset": 775, "text": "800 basis points", "global_span": [ 26958, 26974 ] }, { "id": 168, "label": "Traditional", "start_offset": 776, "end_offset": 795, "text": "sequentially off Q4", "global_span": [ 26975, 26994 ] }, { "id": 169, "label": "Traditional", "start_offset": 1289, "end_offset": 1294, "text": "in Q1", "global_span": [ 27488, 27493 ] }, { "id": 170, "label": "Value", "start_offset": 1303, "end_offset": 1314, "text": "$14 billion", "global_span": [ 27502, 27513 ] }, { "id": 171, "label": "Traditional", "start_offset": 1315, "end_offset": 1323, "text": "of CapEx", "global_span": [ 27514, 27522 ] }, { "id": 172, "label": "Non_Traditional", "start_offset": 1997, "end_offset": 2007, "text": "main issue", "global_span": [ 28196, 28206 ] }, { "id": 173, "label": "Non_Traditional", "start_offset": 2024, "end_offset": 2040, "text": "in the near term", "global_span": [ 28223, 28239 ] }, { "id": 174, "label": "Value", "start_offset": 2044, "end_offset": 2060, "text": "additional CapEx", "global_span": [ 28243, 28259 ] } ], "relations": [ { "id": 69, "entity_ids": [ 166, 167, 168 ], "description": "value_of" }, { "id": 70, "entity_ids": [ 169, 170, 171 ], "description": "value_of" }, { "id": 71, "entity_ids": [ 172, 173, 174 ], "description": "value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Andrew Jassy: Yes, I just would add briefly, just to summarize. I understand where the question is coming from, Doug. And I think we 're in a position to do both is the short answer. I think there 's actually an opportunity in our existing large businesses in the stores business along with advertising and AWS. There 's a lot of growth in front of us. And I think we 're investing in a meaningful way. But I think we also -- we ' ve been pretty consistent about do n't believe that we 're at the end of what we can do in terms of improving our cost structure on the store side. \n Yes, I think there are really unbelievable growth opportunities in front of us. And I think what people sometimes forget on the AWS side, it 's a $100 billion revenue run rate business, that we 're still 85 - plus percent of the global IT spend is on premises. And if you believe that equation is going to flip, which we do, it means we have a lot of growth in front of us, and that 's before the generative AI opportunity, which I do n't know if any of us have seen a possibility like this in technology in a really long time, for sure, since the cloud, perhaps since the Internet. \n And unlike in the cloud where so much -- there 's a lot of work to be done to move from on - premises to the cloud, people do it and they get value out of it, which is why they modernize their infrastructure. But it 's work. All of this generative AI set of workloads, which will transform every experience they 're going to be built from scratch on the cloud largely. And so it 's just tremendous opportunities there along with some of the other areas that we 're investing that are really early stage. So I think it 's both for us.", "ground_truth_output": { "entities": [ { "id": 175, "label": "Value", "start_offset": 729, "end_offset": 741, "text": "$100 billion", "global_span": [ 29342, 29354 ] }, { "id": 176, "label": "Traditional", "start_offset": 742, "end_offset": 767, "text": "revenue run rate business", "global_span": [ 29355, 29380 ] }, { "id": 177, "label": "Value", "start_offset": 787, "end_offset": 789, "text": "85", "global_span": [ 29400, 29402 ] }, { "id": 178, "label": "Traditional", "start_offset": 790, "end_offset": 842, "text": "- plus percent of the global IT spend is on premises", "global_span": [ 29403, 29455 ] } ], "relations": [ { "id": 72, "entity_ids": [ 175, 176 ], "description": "value_of" }, { "id": 73, "entity_ids": [ 177, 178 ], "description": "value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Operator: And our next question comes from the line of Ross Sandler with Barclays.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Ross Sandler: Somewhat related question on CapEx intensity in AWS. So I think the CEO of Anthropic has said that I think the next generation of models cost in the neighborhood of $1 billion to train. This would be like Claude 4, I guess, high end. And then the generation after that might be as much as $10 billion to train. So is this something that you feel like the industry will do on top of AWS? Do you feel like Olympus and some of the stuff you 're doing in - house needs to kind of stay at the state - of - the - art, or can others do that? And then how much did all this training have an impact on the acceleration that you saw in 1Q for AWS revenue?", "ground_truth_output": { "entities": [ { "id": 179, "label": "Non_Traditional", "start_offset": 116, "end_offset": 121, "text": "think", "global_span": [ 30514, 30519 ] }, { "id": 180, "label": "Non_Traditional", "start_offset": 126, "end_offset": 156, "text": "next generation of models cost", "global_span": [ 30524, 30554 ] }, { "id": 181, "label": "Value", "start_offset": 164, "end_offset": 190, "text": "neighborhood of $1 billion", "global_span": [ 30562, 30588 ] }, { "id": 182, "label": "Non_Traditional", "start_offset": 191, "end_offset": 199, "text": "to train", "global_span": [ 30589, 30597 ] } ], "relations": [ { "id": 74, "entity_ids": [ 179, 180, 181, 182 ], "description": "value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Andrew Jassy: Well, Ross, I would tell you that we have seen kind of 3, I 'll call it, macro trends that I think are contributing to AWS ' performance, at least in the last quarter. I think first of all, I think the lion 's share of cost optimization is behind us. So I think companies will be smart and have learned a lot over the last number of months in how they run their infrastructure in the cloud. But I think the lion 's share of the cost optimization is behind us. And I think people have moved to newer initiatives that I would, at a macro level, describe as modernizing their infrastructure and then trying to drive value at a generative AI. \n On the former, I think we were on this march before the pandemic, where most companies were trying to figure out how to move from on - premises to the cloud because it 's more cost - effective and it 's faster to innovate and they get real developer productivity. And then when the pandemic hit and people were in survival mode and the uncertain economy, you let people save costs wherever they could, and they got distracted on that. But they 're back to pursuing and figuring it out because it 's low - hanging fruit for them, and we see very significant growth in that space. \n And at the same time, we 're seeing very significant momentum in people trying to figure out how to run their generative AI on top of AWS. I mentioned we have a multibillion - dollar revenue run rate that we see in AI already, and it 's still relatively early days. And I think that there 's -- at a high level, there 's a few things that we 're seeing that 's driving that growth. I think first of all, there are so many companies that are still building their models. And these range from the largest foundational model builders like Anthropic, you mentioned, to every 12 to 18 months or building new models. \n And those models consume an incredible amount of data with a lot of tokens, and they 're significant to actually go train. And a lot of those are being built on top of AWS, and I expect an increasing amount of those to be built on AWS over time because our operational performance and security and as well as our chips, both what we offer from NVIDIA. But if you take Anthropic, as an example, they 're training their future models on our custom silicon on Trainium. And so I think we 'll have a real opportunity for a lot of those models to run on top of AWS. \n I think the thing that people sometimes do n't realize is that while we 're in the stage that so many companies are spending money training models, once you get those models into production, which not that many companies have, but when you think about how many generative AI applications will be out there over time, most will end up being in production when you see the significant run rates. You spend much more in inference than you do in training because you train only periodically, but you 're spinning out predictions and inferences all the time. \n And so we also see quite a few companies that are building their generative AI applications to do inference on top of AWS. And a lot of it has to do with the services. And the primary example we see there is how many companies, tens of thousands of companies, already are building on top of Amazon Bedrock, which has the largest selection of large language models around and a set of features that make it so much easier to build a high - quality, cost - effective low latency, production - grade generative AI applications. \n So we see both training and inference being really big drivers on top of AWS. And then you layer on top of that the fact that so many companies, their models and these generative AI applications are going to have their most sensitive assets and data. And it 's going to matter a lot to them what kind of security they get around those applications. And yes, if you just pay attention to what 's been happening over the last year or 2, not all the providers have the same track record. And we have a meaningful edge on the AWS side so that as companies are now getting into the phase of seriously experimenting and then actually deploying these applications to production, people want to run their generative AI on top of AWS.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Operator: And the next question comes from the line of Brian Nowak with Morgan Stanley.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Brian Nowak: I have 2. The first one is on cost to serve. I appreciate all the color in the shareholder letter and even tonight on cost to serve. Andy, maybe could you just help us quantify a little more how to think about some of your North Star cost to serve goals over the next couple of years? And what could that mean for potential accompanying reasonable ranges of outcomes for North America retail margins through all of that? \n And then the second one, if cost to serve does improve, I think it should lead to significant incremental cash flow even with more CapEx. So just remind us again how you sort of think through the philosophy of returning capital to shareholders in addition to continuing to invest for the long run?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Brian Olsavsky: Brian, this is Brian. I will start with your second question. So as far as dividends or buybacks or any other capital structure moves, we do n't have anything to share with you on that today. But I 'll reacquaint you with our general philosophy. So our first priority is to invest in -- to support the growth opportunities and long - term investments within our businesses. And generally, we still have many opportunities to put that capital to use that would generate meaningful returns, especially as you heard in generative AI. \n So we 're very -- we have a great deal of passion on that and conviction on that as well. We are reaching a different stage of free cash flow. As you mentioned, we had negative free cash flow for 2 years, ' 21 and ' 22, immediately after the pandemic as we had doubled the size of our operations network and had a lot of other expenses. That was followed by 2023 when we had our largest -- our highest free cash flow ever. And those trends have carried into Q1. So we feel good about the free cash flow. We are, again, still anticipating higher CapEx this year. \n The other thing that we 're doing with cash flow right now is we 're repaying some of the debt that we had taken on during that negative free cash flow period. We have reached a high watermark at the end of Q1 last year. And since then and then through this year, we 'll pay that down over $25 billion. So that 's our first priority as well as 2024 capital expenditures. But otherwise, nothing to share on that front. \n I 'll tee up, Andy, on the stores profitability because I know there 's always generally the comment about how high can operating margins go and how do they compare to historic trends. And I think the same still holds. We look back to before the pandemic, and we say, first, we can achieve those operating margins even without the impact of advertising. And we 're not quite there yet. But we 're not limiting ourselves to that. We 're looking for ways to, again, turn over every rock, look at every process and everything that we do on the logistics side and see how can we get our cost structure down and how can we get speed up and selection up. So it is working on a lot of fronts there, but cost is certainly front and center as we meet and improve customer experience.", "ground_truth_output": { "entities": [ { "id": 183, "label": "Value", "start_offset": 719, "end_offset": 727, "text": "negative", "global_span": [ 36827, 36835 ] }, { "id": 184, "label": "Traditional", "start_offset": 728, "end_offset": 742, "text": "free cash flow", "global_span": [ 36836, 36850 ] }, { "id": 185, "label": "Traditional", "start_offset": 758, "end_offset": 760, "text": "21", "global_span": [ 36866, 36868 ] }, { "id": 186, "label": "Traditional", "start_offset": 767, "end_offset": 769, "text": "22", "global_span": [ 36875, 36877 ] }, { "id": 187, "label": "Traditional", "start_offset": 909, "end_offset": 913, "text": "2023", "global_span": [ 37017, 37021 ] }, { "id": 188, "label": "Value", "start_offset": 930, "end_offset": 937, "text": "largest", "global_span": [ 37038, 37045 ] }, { "id": 189, "label": "Value", "start_offset": 941, "end_offset": 952, "text": "our highest", "global_span": [ 37049, 37060 ] }, { "id": 190, "label": "Traditional", "start_offset": 953, "end_offset": 972, "text": "free cash flow ever", "global_span": [ 37061, 37080 ] }, { "id": 191, "label": "Non_Traditional", "start_offset": 1387, "end_offset": 1400, "text": "pay that down", "global_span": [ 37495, 37508 ] }, { "id": 192, "label": "Value", "start_offset": 1406, "end_offset": 1417, "text": "$25 billion", "global_span": [ 37514, 37525 ] } ], "relations": [ { "id": 75, "entity_ids": [ 183, 184, 185, 186 ], "description": "value_of" }, { "id": 76, "entity_ids": [ 187, 188, 189, 190 ], "description": "value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "Operator: And the next question comes from the line of Youssef Squali with Truist Securities.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Youssef Squali: Andy, on logistics, in September, you launched Amazon supply chain. Can you just help us understand the opportunity you see there? Where are you in that journey to build logistics as a service on a global basis? And does that require a step function increase in CapEx?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "Andrew Jassy: Yes. Thanks for the question, Youssef. I think that it 's interesting what 's happening with our -- the business we 're building in third - party logistics. And it really kind of, in some ways, mirrors some of the other businesses we ' ve gotten involved in, AWS being an example of it, even though it 's -- they 're very different businesses in that we realized that we had our own internal need to build a bunch of these capabilities. \n And we figured that there were probably others who had those same needs and we decided to build services out of them. So as our business has grown, it turns out to be pretty hard work to actually import items from overseas, get them through customs and through the border and then ship them from that point to various facilities. And then it turns out that you do n't want to store those facilities in fulfillment centers because that space is really scarce. So you 'd like to have them in upstream storage facilities that are very inexpensive. And then you 'd like to have a way to be able to know when your more scarce supply in the fulfillment centers needs replenishment and be able to do it automatically from those upstream storage facilities. \n And so all of those were capabilities that we had to build for ourselves to be able to operate our stores business in the way that we wanted to and that our sellers wanted to. And so we built that capability for ourselves first and then we opened up those services as individual services to our sellers. And so we help sellers, we have a service that allows them to get items through the border and through customs. We have a service that allows them to ship from customs to various facilities, whether they 're our own or their separate ones. \n We allow them to store items in our upstream low - cost warehouses that they can either automatically replenish into our fulfillment centers where we ship or they can move to other facilities that they have. We have a service that lets them -- where we 'll ship either to our end customers if they 're selling on Amazon or to their end customers. We obviously have Buy with Prime, where we enable our Prime customers to be able to buy from our third - party Buy with Prime sellers websites, which increases their conversion 25% versus what they would do on their own, and it 's a great benefit for our Prime customers. \n And then I would say that supply chain with Amazon is really an abstraction on top of those individual building block services I just mentioned that makes it easier for customers to have the whole end - to - end supply chain integrated. That collective set of businesses is growing very significantly. It 's already what I would consider a reasonable sized business. And I think it 's just really early days. It is not something that we anticipate being a giant capital expense driver for us. \n We have to build a lot of those capabilities anyway to handle our stores business, and we think we can -- it will be a modest increase on top of that to accommodate third - party sellers. But are third - party sellers find high value in us being able to manage those components for them versus having to do it themselves and they save money in the process.", "ground_truth_output": { "entities": [ { "id": 193, "label": "Traditional", "start_offset": 2213, "end_offset": 2244, "text": "Buy with Prime sellers websites", "global_span": [ 41011, 41042 ] }, { "id": 194, "label": "Traditional", "start_offset": 2252, "end_offset": 2261, "text": "increases", "global_span": [ 41050, 41059 ] }, { "id": 195, "label": "Value", "start_offset": 2279, "end_offset": 2282, "text": "25%", "global_span": [ 41077, 41080 ] }, { "id": 196, "label": "Traditional", "start_offset": 2283, "end_offset": 2321, "text": "versus what they would do on their own", "global_span": [ 41081, 41119 ] } ], "relations": [ { "id": 77, "entity_ids": [ 193, 194, 195, 196 ], "description": "value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Operator: And our next question comes from the line of Justin Post with Bank of America.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Justin Post: I thought I 'd ask a couple of growth drivers that you mentioned. First, grocery, it seems like you 're still changing the threshold for free delivery or the subscription prices. Just can you say at all how much that 's contributing to your gross right now and do you think you 're over the hump? Or are you optimistic this can be a really big category for you? And then maybe a little bit extra on Prime Video ramp, how that ramp went versus your expectations? And do you think that could be a meaningful contributor to ad revenues going forward?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "Andrew Jassy: Yes. I 'll take them in opposite order just on Prime Video ads. Very early days, just launched a few months ago. It 's off to a really good start. I think advertisers are excited about being able to expand their ability to advertise with us in video beyond Twitch and Freevee to Prime Video shows and movies. I think they also find that the relevancy and the measurability of that type of advertising and Prime Video ads is unique for them. So it 's off to a very good start, it 's early days, but we 're optimistic there. \n On grocery, I would tell you that we continue to be optimistic about what we 're doing in grocery. We have a very large grocery business. It 's kind of got a few different components. And we have a very, very significant nonperishables grocery business much the same way that the mass merchandisers entered this business 30 or 40 years ago. These are consumables and canned goods and pet food and health care and beauty products. That continues to grow at a very rapid rate. \n And we have an organic grocery business in Whole Foods Market, which is the pioneer in that space. And that business continues to grow very nicely. We 're introducing a new smaller format in the fall in Manhattan and the Whole Foods Market Daily Shops idea. We ' ve worked very hard on the profitability trajectory over the last 18 months and like the way that, that has taken shape. And then if you want to have -- do you want to serve as many grocery missions as we aim to serve. You have to have a perishables business and a mass physical presence. And that 's what we ' ve been working on with Amazon Fresh. \n We ' ve launched our V2 format in physical stores over the last few months, primarily in Chicago and Southern California. We like the early results a lot. They 're really meaningfully better in almost every dimension. It 's still early, and there 's some things to work through, but we like what we 're seeing there. And then we have to decide the best way to roll those out over time. \n And as you mentioned, Justin, we just launched a Prime benefit for grocery, which is all - you - can - eat delivery for $9.99 a month, which if you order once from Whole Foods a month, it pays for itself, or once from Amazon Fresh for orders under $40, it pays for itself. It 's a very valuable offering for our Prime members, and it 's off to a great start. So we have a lot -- in my opinion, we have lots of ways that we can continue to help customers satisfy their grocery needs. And we have some building blocks that I think might also change how people split up their grocery orders over time. But I continue to be optimistic that, that 's going to continue to grow for us.", "ground_truth_output": { "entities": [ { "id": 197, "label": "Non_Traditional", "start_offset": 1642, "end_offset": 1654, "text": "launched our", "global_span": [ 44319, 44331 ] }, { "id": 198, "label": "Value", "start_offset": 1655, "end_offset": 1664, "text": "V2 format", "global_span": [ 44332, 44341 ] }, { "id": 199, "label": "Non_Traditional", "start_offset": 1668, "end_offset": 1683, "text": "physical stores", "global_span": [ 44345, 44360 ] } ], "relations": [ { "id": 78, "entity_ids": [ 197, 198, 199 ], "description": "value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Operator: And our final question will come from the line of Ron Josey with Citi.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Ronald Josey: Maybe, Andy, I wanted to ask on international profitability, just after 1Q 's 2.8% margin. Talk just about where we are in terms of international getting or to consistent profitability. We 're following a similar trajectory as North America in terms of benefiting from regionalization shift, and we saw what average distance of each package traveled actually came down by 25 kilometers and whatnot. And if you could provide any insights on maybe how inbound fulfillment architecture might add to just continued benefits on faster shipping, same - day, next day, et cetera.", "ground_truth_output": { "entities": [ { "id": 200, "label": "Traditional", "start_offset": 47, "end_offset": 74, "text": "international profitability", "global_span": [ 45506, 45533 ] }, { "id": 201, "label": "Traditional", "start_offset": 87, "end_offset": 89, "text": "1Q", "global_span": [ 45546, 45548 ] }, { "id": 202, "label": "Value", "start_offset": 93, "end_offset": 97, "text": "2.8%", "global_span": [ 45552, 45556 ] }, { "id": 203, "label": "Traditional", "start_offset": 98, "end_offset": 104, "text": "margin", "global_span": [ 45557, 45563 ] }, { "id": 204, "label": "Non_Traditional", "start_offset": 323, "end_offset": 364, "text": "average distance of each package traveled", "global_span": [ 45782, 45823 ] }, { "id": 205, "label": "Non_Traditional", "start_offset": 374, "end_offset": 383, "text": "came down", "global_span": [ 45833, 45842 ] }, { "id": 206, "label": "Value", "start_offset": 387, "end_offset": 389, "text": "25", "global_span": [ 45846, 45848 ] }, { "id": 207, "label": "Non_Traditional", "start_offset": 390, "end_offset": 400, "text": "kilometers", "global_span": [ 45849, 45859 ] } ], "relations": [ { "id": 79, "entity_ids": [ 200, 201, 202, 203 ], "description": "value_of" }, { "id": 80, "entity_ids": [ 204, 205, 206, 207 ], "description": "value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Brian Olsavsky: Thank you, Ron. I ' m going to start with this one on international profitability. So yes, in the quarter, our operating income was $902 million. And if you ' ve watched that, we ' ve seen a steady progression in operating income in our international segment, it 's up $2.2 billion year - over - year. So we like the trend there. It breaks down into a few areas. I would say the established countries of Europe, Japan, as well as the U.K. are following a lot of the same trajectory as in the United States. They are profitable in their own right. They are adding selection, they 're adding new features like grocery there, adding to their Prime benefits, and a lot of the work that we do in the United States carries over there. \n The second group is the emerging countries. And of course, we ' ve launched 10 new countries in the last 7 years. Each of those has its own particular trajectory on profitability. The first thing we see there is having a good customer experience, having people sign up for Prime. A lot of times, our Prime Video benefits help with that. Then work on our cost structure as we get scale, add advertising and other things. And eventually, what we see is a breakeven -- countries breakeven and then they make positive income and free cash flow and are more of a contribution to the -- positive contribution to the international segment. So we 're seeing both the emerging and the established improving, and we like the trajectory. And I think you 'll see more of as we move forward.", "ground_truth_output": { "entities": [ { "id": 208, "label": "Traditional", "start_offset": 128, "end_offset": 144, "text": "operating income", "global_span": [ 46174, 46190 ] }, { "id": 209, "label": "Value", "start_offset": 149, "end_offset": 161, "text": "$902 million", "global_span": [ 46195, 46207 ] }, { "id": 210, "label": "Traditional", "start_offset": 230, "end_offset": 246, "text": "operating income", "global_span": [ 46276, 46292 ] }, { "id": 211, "label": "Traditional", "start_offset": 254, "end_offset": 275, "text": "international segment", "global_span": [ 46300, 46321 ] }, { "id": 212, "label": "Value", "start_offset": 283, "end_offset": 298, "text": "up $2.2 billion", "global_span": [ 46329, 46344 ] }, { "id": 213, "label": "Traditional", "start_offset": 299, "end_offset": 317, "text": "year - over - year", "global_span": [ 46345, 46363 ] }, { "id": 214, "label": "Value", "start_offset": 825, "end_offset": 827, "text": "10", "global_span": [ 46871, 46873 ] }, { "id": 215, "label": "Non_Traditional", "start_offset": 828, "end_offset": 841, "text": "new countries", "global_span": [ 46874, 46887 ] }, { "id": 216, "label": "Non_Traditional", "start_offset": 849, "end_offset": 861, "text": "last 7 years", "global_span": [ 46895, 46907 ] } ], "relations": [ { "id": 81, "entity_ids": [ 208, 209 ], "description": "value_of" }, { "id": 82, "entity_ids": [ 210, 211, 212, 213 ], "description": "value_of" }, { "id": 83, "entity_ids": [ 214, 215, 216 ], "description": "value_of" } ] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Andrew Jassy: Yes. I would add a few things. I mean, I ' m again quite bullish on our international stores business. It 's already a very large business. We ' ve added a number of countries that are on the right trajectory, as Brian just indicated, and it 's going to be a big, profitable business for us. And I really like the direction it 's headed. \n I 'll take also just the second part of your question just really around continuing to take -- to work on cost structure. I 'd say, first of all, on the regionalization side, which we ' ve talked a lot about the last year, it may sound a little boring to talk about because we talked about it a lot of times. But I 'd just tell you that we 're not done there. A lot of the work that we ' ve done, we still have opportunities to refine, to get more value out of that. And a lot of what we learned on the regionalization side in the U.S. was in part inspired from what we saw in Europe, which, in many ways, is set up as a regional network because of the nature of how close those countries are to one another. \n And I would say we have also learned lessons from what we ' ve done in the U.S. that we 're going to be able to apply to our international operations as well. I think we see additional opportunities in all sorts of places. A good example of which is just how and where we inbound items to. The architecture we ' ve had set up has largely had people inbounding to a couple of places. And then we took -- we spent a lot of effort and time and expense in breaking those down and shipping them to lots of other places. \n And we believe we 're going to be much more efficient in how we use the inbound network and how we partner with our sellers. Part of what we did with our change in seller fees, we lowered the outbound fees in a meaningful way, but then we added an incentive for our sellers to inbound into locations that allow us to be more cost following and allow both our sellers and us to enjoy in those cost savings when we 're able to do so. And we 're seeing very optimistic signs there, too. \n I think we 're still early with respect to how we can continue to optimize the number of units per box, which has all sorts of good benefits. And then I 'd just also say that it 's been really interesting to watch the same - day facilities evolution in our fulfillment network. And I think a lot of people have made the assumption over the last few years that faster speeds are going to mean higher cost, and that is not the case if you build the infrastructure with the right building blocks the way we have over the last couple of years. \n And our same - day facilities are our least expensive facilities in the network. We still have a fraction of the number of those that we will have in the U.S. that we 'll have in other parts of the world, which will, again, both change our cost structure while increasing speed. So I do n't think we 're at the limits of what we can do. It 's not going to all happen in 1 year. We 're going to be working hard at this and inventing at this for several years, but I think we have a lot of upside in front of us.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Dave Fildes: Thank you for joining us on the call today and for your questions. A replay will be available on our Investor Relations website for at least 3 months. We appreciate your interest in Amazon and look forward to speaking with you again next quarter.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "AMZN", "quarter": 1, "year": 2024, "date": "2024-04-30 17:30:00", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Operator: And ladies and gentlemen, that does conclude today 's teleconference. You may disconnect your lines at this time. Thank you for your participation.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Operator: Thank you for standing by. Good day, everyone, and welcome to The Boeing Company 's Third Quarter 2023 Earnings Conference Call. Today 's call is being recorded. The management discussion and slide presentation, plus the analysts ' question - and - answer session are being broadcast live over the internet. [Operator Instructions ] At this time, for opening remarks and introductions, I ' m turning the conference over to Mr. Matt Welch, Vice President of Investor Relations for Boeing Company. Mr. Welch, please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Matt Welch: Thank you and good morning. Welcome to Boeing 's quarterly earnings call. I am Matt Welch, and with me today are Dave Calhoun, Boeing 's President and Chief Executive Officer; and Brian West, Boeing 's Executive Vice President and Chief Financial Officer. As a reminder, you can follow today 's broadcast and slide presentation at boeing.com. As always, detailed financial information is included in today 's press release. Furthermore, projections, estimates and goals included in today 's discussion involve risks, including those described in our SEC filings and in the forward - looking statement disclaimer at the end of the web presentation. In addition, we refer you to our earnings release and presentation for disclosures and reconciliation of certain non - GAAP measures. Now I will turn the call over to Dave Calhoun.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Thank you, Matt, and thanks to all for joining us this morning. Let me start with a comment on the conflict in Israel and Gaza. We were saddened to see the horrific attacks on Israel and the escalating conflict in the region that is resulting in a significant humanitarian emergency. We will continue to monitor the situation. We will focus on the safety of our employees and we will aid those in need. As always, we 'll follow the lead of the U.S. government and we 'll coordinate closely with government agencies, customers and suppliers, always with safety, security and well - being as our top priority. Now let me turn to the quarter. As you know, we ran into a few challenges over the last several months, but we ' ve demonstrated that we know how to overcome obstacles and it will continue to do just that. We knew 2023 would be a bumpy ride. We have more work to do, but overall, we 're making progress in our recovery and we are on track to meet the financial goals we shared for this year and for the 2025/2026 time frame. A time frame I refer to as stability. As you know, free cash flow has been our primary financial metric through this recovery. And based on our performance year - to - date, we still plan to be in the guidance range for the year as well as the $10 billion target by 2025 and 2026. This is a complex long cycle business and driving stability takes time, especially as an entire industry works its way back from the impact of a global pandemic. We expect challenges to come our way. And when they do, we are transparent. We take action and we move forward. So month to month and quarter to quarter, it can be tough to predict, but we 're focused on the long - term and we 're taking the tough actions now to ensure that the long - term future is strong. So with that, I 'll highlight a few key updates around the business. Boeing Commercial, BCA, in commercial, demand continues to be incredibly robust. We booked about 400 net orders in the quarter, including 150 737 MAX-10s for Ryanair, 50 787s for United Airlines, and 39 787s for Saudi Arabian Airlines. With demand strong, our focus remains on delivering airplanes. We are seeing increased stability and quality performance within our own factories, but we 're working to get the supply chain caught up to the same standards. Our production system is poised for steady and efficient increases, but we wo n't push the system too fast and will ensure the supply base is in lockstep with us. On the 737, we 're moving through rework on the most recent non - conformance in the aft pressure bulkhead. That work slowed production and deliveries down in the course of the quarter, and given our year - to - date total, we now expect 737 deliveries for the year to be in this 375 to 400 range. While a setback, we 'll regain our momentum as we progress through the issue. We are keeping our suppliers hot, according to the master schedule. We plan to complete the production transition to 38 per month by the end of the year, and still plan to reach the key rate of 50 per month by that 2025 and 2026 time frame. Important to note, with respect to our supply chain, delivery shortfalls have been driven by non - conformances, not actual supply chain constraints. On the 787, the program is demonstrating improved stability. We are now transitioning production from four to five per month and expect to meet our delivery range of 70 to 80 for the year. And longer term, we 're on track for the rate step up to ten per month by 2025 and 2026. To ensure our broader recovery and return to more normal margins, the key focus continues to be on liquidating our 787 and 737 inventory so that we can eliminate those shadow factories and focus our resources on the production floor, all of our resources. Nonconformance costs are exponentially higher on all of those finished airplanes. We still plan to deliver most, if not all, of the inventory by the end of next year, which will set us on a strong path for 2025 and 2026. With respect to China, we are encouraged by recent signs of progress and continue to work closely with our customers on the timing of returning to delivery. As I mentioned, supply chain performance will be a key enabler. As Spirit Aerospace Systems brings in new leadership, we 're looking forward to working with Pat. Pat Shanahan is known by The Boeing Company. We have great respect for his abilities on the shop floor, and we 're pleased to have recently established a mutually beneficial agreement that will enhance stability of our production system and help us deliver on our customer commitments, a true win - win. Lastly, on the development side, we 're progressing across our commercial programs, and our timelines are unchanged on the 737 - 7 and the 737 - 10 and the 777X and 777 - 8 freighter. A reminder, as always, the FAA will ultimately control the timing. Boeing Defense Systems, BDS, in Defense and Space, we still have more work to improve operating performance. Results this quarter were impacted by higher estimated costs on the VC-25B program. We are maturing through this build process, incorporating engineering changes to better support the installation process, and we resolved important supplier negotiations over the course of the quarter. I 'll note that none of these items will impact the performance and capability of the end product. The increased estimates reflect the process by which we build the airplanes. And in a fixed price environment, any unplanned hurdles can introduce unrecoverable costs. At the end of the day, we have two airplanes to build. We are getting past these hurdles and are committed to delivering two exceptional airplanes for our customer. Separately, as you saw, we are also expecting higher costs on a satellite program as we build out the Constellation and meet our life cycle commitments for our customer. We 're working on real innovation and advanced capabilities in this space and see real potential market as we deliver against this commitment. More broadly across BDS, we 're stabilizing operations and taking comprehensive actions to improve performance, including lean initiatives, contracting disciplines, factory improvements, engineering investments and more. We 're seeing some early signs of progress, but financial improvement at BDS ' lower volumes takes time. Recovery in BDS is slower than we 'd like, slower than I 'd like, but we 're confident in the future and our path to normalizing BDS margin performance by that 2025 and 2026 time frame is intact. The confidence is due in part to key milestones we 're starting to hit and the strong demand we 're seeing. For example, we delivered the first T-7A to the U.S. Air Force this quarter. We also captured a key award from the U.S. Army for 21 Apache helicopters. Additionally, we continue to invest and position ourselves for significant opportunities in proprietary programs. The backlog at BDS is $58 billion, and nearly 30% of that is outside the United States. We 're proud of the role our products play in protecting global security and national defense. Demand is strong, we 're confident in the business, and we will continue to improve operational performance to more normalized levels. Boeing Global Services, BGS, in Global Services, the team had another strong quarter, both on the commercial and the government side with improved revenue and earnings relative to the third quarter of 2022. The financials were again driven by strong operating performance and the team 's ability to hit key milestones and capture new business. In the quarter, BGS delivered the 150th 737 - 800 Boeing Converted Freighter, received an award from the U.S. Navy for P-8 trainer upgrades and signed a digital maintenance agreement with multiple airlines. Our services team represents Boeing with our customers nearly every minute of every day. The work they do to keep military and commercial fleets flying is best - in - class, and we 're proud of the performance that they 're delivering. A step back with respect to the market outlook. Looking across all three business units, demand for our products and services continues to be incredibly strong. Our backlog is at $469 billion, including over 5,100 commercial airplanes. Over the next ten years, the value of the markets we serve across commercial, defense, space and services is estimated at $10.7 trillion according to our most recent Boeing market outlook. Our products deliver exceptional capability in strong and growing markets, and our portfolio is well aligned with our customers ' needs. The demand is there to support our recovery. It is on us to perform, and we will remain disciplined and patient in the process. Brian, I 'll turn it over to you.", "ground_truth_output": { "entities": [ { "id": 0, "label": "Traditional", "start_offset": 1099, "end_offset": 1113, "text": "free cash flow", "global_span": [ 2473, 2487 ] }, { "id": 1, "label": "Traditional", "start_offset": 1204, "end_offset": 1220, "text": "year - to - date", "global_span": [ 2578, 2594 ] }, { "id": 2, "label": "Value", "start_offset": 1292, "end_offset": 1303, "text": "$10 billion", "global_span": [ 2666, 2677 ] }, { "id": 3, "label": "Value", "start_offset": 1966, "end_offset": 1969, "text": "400", "global_span": [ 3340, 3343 ] }, { "id": 4, "label": "Traditional", "start_offset": 1970, "end_offset": 1980, "text": "net orders", "global_span": [ 3344, 3354 ] }, { "id": 5, "label": "value", "start_offset": 2007, "end_offset": 2010, "text": "150", "global_span": [ 3381, 3384 ] }, { "id": 6, "label": "Non_Traditional", "start_offset": 2011, "end_offset": 2034, "text": "737 MAX-10s for Ryanair", "global_span": [ 3385, 3408 ] }, { "id": 7, "label": "Value", "start_offset": 2036, "end_offset": 2038, "text": "50", "global_span": [ 3410, 3412 ] }, { "id": 8, "label": "Non_Traditional", "start_offset": 2039, "end_offset": 2063, "text": "787s for United Airlines", "global_span": [ 3413, 3437 ] }, { "id": 9, "label": "Value", "start_offset": 2069, "end_offset": 2071, "text": "39", "global_span": [ 3443, 3445 ] }, { "id": 10, "label": "Non_Traditional", "start_offset": 2072, "end_offset": 2103, "text": "787s for Saudi Arabian Airlines", "global_span": [ 3446, 3477 ] }, { "id": 11, "label": "Non_Traditional", "start_offset": 2729, "end_offset": 2743, "text": "737 deliveries", "global_span": [ 4103, 4117 ] }, { "id": 12, "label": "Non_Traditional", "start_offset": 2752, "end_offset": 2756, "text": "year", "global_span": [ 4126, 4130 ] }, { "id": 13, "label": "Value", "start_offset": 2771, "end_offset": 2774, "text": "375", "global_span": [ 4145, 4148 ] }, { "id": 14, "label": "Value", "start_offset": 2778, "end_offset": 2781, "text": "400", "global_span": [ 4152, 4155 ] }, { "id": 15, "label": "Non_Traditional", "start_offset": 2959, "end_offset": 2969, "text": "production", "global_span": [ 4333, 4343 ] }, { "id": 16, "label": "Value", "start_offset": 2984, "end_offset": 2996, "text": "38 per month", "global_span": [ 4358, 4370 ] }, { "id": 17, "label": "Non_Traditional", "start_offset": 3015, "end_offset": 3019, "text": "year", "global_span": [ 4389, 4393 ] }, { "id": 18, "label": "Value", "start_offset": 3061, "end_offset": 3073, "text": "50 per month", "global_span": [ 4435, 4447 ] }, { "id": 19, "label": "Non_Traditional", "start_offset": 3265, "end_offset": 3268, "text": "787", "global_span": [ 4639, 4642 ] }, { "id": 20, "label": "Non_Traditional", "start_offset": 3344, "end_offset": 3354, "text": "production", "global_span": [ 4718, 4728 ] }, { "id": 21, "label": "Value", "start_offset": 3360, "end_offset": 3364, "text": "four", "global_span": [ 4734, 4738 ] }, { "id": 22, "label": "Value", "start_offset": 3368, "end_offset": 3382, "text": "five per month", "global_span": [ 4742, 4756 ] }, { "id": 23, "label": "Value", "start_offset": 3424, "end_offset": 3426, "text": "70", "global_span": [ 4798, 4800 ] }, { "id": 24, "label": "Value", "start_offset": 3430, "end_offset": 3432, "text": "80", "global_span": [ 4804, 4806 ] }, { "id": 25, "label": "Non_Traditional", "start_offset": 3441, "end_offset": 3445, "text": "year", "global_span": [ 4815, 4819 ] }, { "id": 26, "label": "Non_Traditional", "start_offset": 6673, "end_offset": 6682, "text": "delivered", "global_span": [ 8047, 8056 ] }, { "id": 27, "label": "Non_Traditional", "start_offset": 6687, "end_offset": 6697, "text": "first T-7A", "global_span": [ 8061, 8071 ] }, { "id": 28, "label": "Traditional", "start_offset": 6927, "end_offset": 6934, "text": "backlog", "global_span": [ 8301, 8308 ] }, { "id": 29, "label": "Traditional", "start_offset": 6938, "end_offset": 6941, "text": "BDS", "global_span": [ 8312, 8315 ] }, { "id": 30, "label": "Value", "start_offset": 6945, "end_offset": 6956, "text": "$58 billion", "global_span": [ 8319, 8330 ] }, { "id": 31, "label": "Value", "start_offset": 6969, "end_offset": 6972, "text": "30%", "global_span": [ 8343, 8346 ] }, { "id": 32, "label": "Traditional", "start_offset": 7388, "end_offset": 7395, "text": "revenue", "global_span": [ 8762, 8769 ] }, { "id": 33, "label": "Traditional", "start_offset": 7400, "end_offset": 7408, "text": "earnings", "global_span": [ 8774, 8782 ] }, { "id": 34, "label": "Traditional", "start_offset": 7491, "end_offset": 7512, "text": "operating performance", "global_span": [ 8865, 8886 ] }, { "id": 35, "label": "Non_Traditional", "start_offset": 7605, "end_offset": 7614, "text": "delivered", "global_span": [ 8979, 8988 ] }, { "id": 36, "label": "Value", "start_offset": 7619, "end_offset": 7624, "text": "150th", "global_span": [ 8993, 8998 ] }, { "id": 37, "label": "Non_Traditional", "start_offset": 7625, "end_offset": 7628, "text": "737", "global_span": [ 8999, 9002 ] }, { "id": 38, "label": "Traditional", "start_offset": 8193, "end_offset": 8200, "text": "backlog", "global_span": [ 9567, 9574 ] }, { "id": 39, "label": "Value", "start_offset": 8207, "end_offset": 8219, "text": "$469 billion", "global_span": [ 9581, 9593 ] }, { "id": 40, "label": "Value", "start_offset": 8236, "end_offset": 8241, "text": "5,100", "global_span": [ 9610, 9615 ] }, { "id": 41, "label": "Non_Traditional", "start_offset": 8242, "end_offset": 8262, "text": "commercial airplanes", "global_span": [ 9616, 9636 ] }, { "id": 42, "label": "Traditional", "start_offset": 8293, "end_offset": 8313, "text": "value of the markets", "global_span": [ 9667, 9687 ] }, { "id": 43, "label": "Value", "start_offset": 8386, "end_offset": 8400, "text": "$10.7 trillion", "global_span": [ 9760, 9774 ] }, { "id": 239, "label": "Traditional", "text": "target by 2025 and 2026", "start_offset": 1304, "end_offset": 1327, "global_span": [ 2678, 2701 ] }, { "id": 240, "label": "non_traditional", "text": "Boeing Commercial, BCA", "start_offset": 1869, "end_offset": 1891, "global_span": [ 3243, 3265 ] }, { "id": 241, "label": "non_traditional", "text": "in the quarter", "start_offset": 1981, "end_offset": 1995, "global_span": [ 3355, 3369 ] }, { "id": 242, "label": "non_traditional", "text": "we now expect", "start_offset": 2715, "end_offset": 2728, "global_span": [ 4089, 4102 ] }, { "id": 243, "label": "non_traditional", "text": "the end of the ", "start_offset": 3000, "end_offset": 3015, "global_span": [ 4374, 4389 ] }, { "id": 244, "label": "non_traditional", "text": "2025 and 2026 time frame", "start_offset": 3082, "end_offset": 3106, "global_span": [ 4456, 4480 ] }, { "id": 245, "label": "non_traditional", "text": "expect", "start_offset": 3387, "end_offset": 3393, "global_span": [ 4761, 4767 ] }, { "id": 246, "label": "non_traditional", "text": "ten per month", "start_offset": 3504, "end_offset": 3517, "global_span": [ 4878, 4891 ] }, { "id": 247, "label": "non_traditional", "text": "2025 and 2026.", "start_offset": 3998, "end_offset": 4012, "global_span": [ 5372, 5386 ] }, { "id": 248, "label": "non_traditional", "text": " by 2025 and 2026.", "start_offset": 3517, "end_offset": 3535, "global_span": [ 4891, 4909 ] }, { "id": 249, "label": "non_traditional", "text": "is outside the United States", "start_offset": 6981, "end_offset": 7009, "global_span": [ 8355, 8383 ] }, { "id": 250, "label": "non_traditional", "text": "BGS", "start_offset": 7601, "end_offset": 7604, "global_span": [ 8975, 8978 ] } ], "relations": [ { "id": 1, "entity_ids": [ 0, 2, 239 ], "description": "Value_of" }, { "id": 2, "entity_ids": [ 3, 4, 240, 241 ], "description": "Value_of" }, { "id": 3, "entity_ids": [ 5, 6 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 7, 8 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 9, 10 ], "description": "Value_of" }, { "id": 6, "entity_ids": [ 11, 12, 13, 14, 242 ], "description": "Value_of" }, { "id": 7, "entity_ids": [ 15, 16, 17, 243 ], "description": "Value_of" }, { "id": 8, "entity_ids": [ 15, 18, 244 ], "description": "Value_of" }, { "id": 9, "entity_ids": [ 19, 20, 21, 22 ], "description": "Value_of" }, { "id": 10, "entity_ids": [ 20, 23, 24, 25, 245 ], "description": "Value_of" }, { "id": 11, "entity_ids": [ 246, 248 ], "description": "Value_of" }, { "id": 12, "entity_ids": [ 26, 27 ], "description": "Value_of" }, { "id": 13, "entity_ids": [ 28, 29, 30 ], "description": "Value_of" }, { "id": 14, "entity_ids": [ 28, 29, 31, 249 ], "description": "Value_of" }, { "id": 15, "entity_ids": [ 35, 36, 37, 250 ], "description": "Value_of" }, { "id": 16, "entity_ids": [ 38, 39 ], "description": "Value_of" }, { "id": 17, "entity_ids": [ 38, 40, 41 ], "description": "Value_of" }, { "id": 18, "entity_ids": [ 42, 43 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Brian West: Thanks, Dave, and good morning, everyone. Let 's go to the next slide and start with total company financial performance. Third quarter revenue was $18.1 billion. That 's up 13% year - over - year. Growth was driven by higher commercial volume, primarily on higher 787 deliveries. Core operating margin in the quarter was minus 6%, and the core loss per share was $3.26. Margins and EPS were negatively impacted by unfavorable defense performance, which I 'll cover in a moment; lower 737 deliveries that were in line with expectations set last month; and expected abnormal costs and period expenses. Free cash flow was a usage of $310 million in the quarter. This reflects the lower 737 deliveries and in line with our expectations. With that, I 'll turn to the next page and cover Boeing Commercial Airplanes. BCA booked 398 net orders in the quarter, including 150 MAX-10s for Ryanair, 50 87s for United and 39 87s for Saudi Arabian Airlines. BCA now has over 5,100 airplanes in the backlog valued at $392 billion. BCA delivered 105 airplanes in the quarter, and revenue was $7.9 billion. That 's up 25% year - over - year driven by the higher 787 deliveries. Operating margin was minus 8.6%. We saw the impact of the lower 737 deliveries as well as expected abnormal costs and period expenses, including higher R&D spending primarily on the 777X investment. Now I 'll give a little more color on the key programs. On 737, we delivered 70 airplanes in the quarter, reflecting the impact of the recent supplier fuselage nonconformance. Since our early September update, additional areas of the aft pressure bulkhead were identified that require further inspection and rework, which you likely read about. This additional scope impacts units that had already gone through the initial rework and will take us more time to stabilize production and deliveries. We founded the issue, understand the rework steps required and booked a nonmaterial financial impact in the quarter. Considering these latest facts, we expect October deliveries to be in line with September and now expect to deliver between 375 and 400 airplanes for the year. Performance ultimately will be dictated by the pace of a fuselage recovery. The quarter ended with approximately 250 MAX airplanes in inventory, 85 of which are being held for customers in China. We still expect most of the MAX inventory aircraft to be delivered by the end of 2024 but more are likely to slip into 2025 tied to the fuselage recovery. To support stability, suppliers are continuing with planned rate increases and we 're selectively managing inventory levels on certain parts where prudent. We expect to complete the 737 transition to 38 per month by year - end, and we 're maintaining plans to increase to 50 per month in the 2025, 2026 time frame. On the 787 program, we had 19 deliveries in the quarter and 50 year - to - date. We still expect 70 to 80 deliveries this year. We started transitioning production to five per month in October and still plan to reach 10 per month in the 2025, 2026 time frame. We ended the quarter with 75 airplanes in inventory. Rework is progressing nicely, and we still expect most to be delivered by the end of 2024. We booked $244 million of abnormal costs, in line with expectations. The total estimate is now $3 billion, up a bit, and we still expect to be largely done by year - end. Moving to the 777X program. Efforts are ongoing. The program timeline is unchanged, and we plan to resume production later this year. We booked $180 million of abnormal costs in the quarter, in line with expectations. The total estimate is unchanged at $1 billion, and we expect to be done this quarter. Importantly, as Dave mentioned, we recently reached an agreement with Spirit on commercial terms associated with the 737 and 787 programs. We believe this agreement is a win - win for both companies and directly promotes our goal to drive stability and support our airline customers. Moving on to the next page, Boeing Defense and Space. BDS booked $6 billion in orders during the quarter, and the backlog now stands at $58 billion. Revenue was $5.5 billion, essentially flat year - over - year, and we delivered 28 aircraft. Operating margin was minus 16.9% in the quarter. In early September, we indicated that margins would be around minus 9%, the driver being a $482 million charge on the VC-25B fixed price development program due to higher estimated manufacturing costs related to engineering changes, labor instability, and the resolution of supplier negotiations. As we closed the books at quarter end, we saw another 8 points of margin erosion driven by first a $315 million loss tied to customer considerations and higher estimated costs to deliver a highly innovative satellite constellation contract that we signed several years ago. And second, we had smaller, less material cost pressures across a couple programs totaling $136 million primarily driven by the MQ-25program. These are disappointing results in the quarter and year - to - date. This performance is below our expectations, and we acknowledge that we are n’t as far along in this recovery as we expected to be at this stage. I ’d like to point out that the team is executing a game plan to get BDS back to the high - single digit margins by the 2025, 2026 time frame. As you can see on the right hand side of the slide, we ’re driving lean manufacturing, program management rigor and cost productivity consistently across the division. We have invested in new training programs to accelerate performance on the factory floor, and we ’ ve deployed resources at our suppliers to support their recovery. Perhaps most importantly, we instituted much tighter underwriting standards. As you know, part of the challenge we ’re dealing with are legacy contracts that we need to get out from under. Rest assured, we have n’t signed any fixed price development contracts nor intend to. These moves are all fundamental to accelerating the recovery by the 2025, 2026 time frame. We have detailed metrics and milestones to evaluate our performance and progress across the three areas that we ’ ve previously highlighted. First, we have a solid core business representing about 60% of our revenue that performs in the mid to high - single digit margin range. The demand for these products is strong. In particular, volume for our missile and weapons products as well as the Apache are very robust given the current threat environment, and we need to keep executing, competing and growing these offerings. Then we have the 25% of the portfolio representing specific fighter and satellite programs that have negatively impacted margins the past several quarters. In these areas, we took on fixed price production contracts in a pre - pandemic environment with real technical innovation that we ’re working our way through. We fully expect to see recovery in these areas as we improve execution, deliver next generation capabilities, and roll into new contracts with stronger underwriting disciplines that more accurately reflect the prevailing economic conditions. We expect to return to the strong performance levels that we ’ ve demonstrated historically on these programs as we move into the 2025, 2026 time frame. Lastly, we have our large fixed price development programs that represent the remaining 15% of the portfolio, and we continue to be focused on maturing and retiring these risks. Specifically, on the KC-46A program, we ’re stabilizing the production system. We ’ ve seen signs of progress and improved productivity, and as of this month, we have delivered 77 tankers to the customer. For the VC-25B, we ’re now maturing through the build process, and the key milestones ahead are power on and first flight, both of which will essentially be behind us as we move through the 2025, 2026 time frame and represent a significant derisking of the program. For commercial crew, while it has been a long road, we ’re preparing to execute a successful crewed flight test next year and then fulfill operational launch commitments, all of which will be completed as we exit 2025, 2026. On T-7A, we just delivered the first aircraft to the Air Force this quarter and have begun critical phases of the flight test program. On MQ-25, we ’ll get through key build and flight test milestones and transition out of the development phase as we move through the 2025, 2026 time frame. We remain very confident in the T-7A and MQ-25 investments that will deliver innovative performance to the customer with a strong long - term demand profile. So for BDS, this recovery is challenging at the moment, but we believe the actions we ’re taking will begin to gain traction and then accelerate. Fast forward to that 2025, 2026 time frame, fixed price development contracts will be substantially derisked. We ’ll have a healthy order book underwritten with much better economics and underwriting disciplines, and a resilient employee base and supply chain that ’s executing at a much higher level. Moving on to the next slide Boeing Global Services. BGS had another strong quarter. They received $5 billion in orders during the quarter, and the backlog sits at $18 billion. Revenue was $4.8 billion, up 9% year - over - year, primarily on favorable commercial volume and mix. Operating margins were a strong 16.3% in line with our expectations. Importantly, our commercial and government businesses continued to deliver double - digit margins. With that, we ’ll turn to the next page and cover cash and debt. On cash marketable securities, we ended the quarter at $13.4 billion, and on debt, the balance remained flat at $52.3 billion. We had access to $10 billion of revolving credit facilities at the end of the quarter, all of which was undrawn. Our liquidity position is strong. The investment grade credit rating continues to be a priority, and we 're deploying capital in line with the priorities that we ' ve shared, invest in the business and pay down debt through strong cash flow generation. And flip into the last page on our outlook. The overall financial outlook for 2023 is unchanged from what we previously shared, including $3 billion to $5 billion of free cash flow generation, although the updated 737 deliveries now point more toward the low end of the free cash flow range. We also expect R&D to come in slightly above our original guide, tied to the higher 777X investments that I touched on earlier. Stepping back to address the state of the market. Commercial demand remains strong across our key programs and services. Global passenger traffic was up nearly 30% year - on - year in August and is at 96% of pre - pandemic levels, 109% domestic and 89% international. Cargo remains healthy and August was the first month with annual cargo growth since early 2022. Defense demand is also robust, and FY2024 budget continues to be in line with our expectations. Our portfolio and capabilities are well position to support the needs of the nation and of our allies. With demand strong, we still find ourselves in a supply constrained environment and our focus continues to be on execution both within our factories and the supply chain as we steadily increase production. We 're squarely focused on a meaningful step up in operating performance, including deliveries, revenue, margins and cash flow, all of which we expect to improve as we finish out the year. On 4Q specifically, we expect BCA margins to improve sequentially, but remain negative more in line with 2Q, and we 're still not anticipating much in terms of BDS profitability. On the tax expense side, we still expect full year tax expense of approximately $250 million. As we look into early 2024, we see a number of key milestones that give us confidence in building momentum across the business. The 737 factory should be recovered from the current non - conformance and will be stabilizing production at 38 per month with step ups as we move to 50 per month by 2025, 2026. 787 will be stabilizing production at five per month with a focus on stepping up to 10 per month by 2025, 2026. We 'll be further along in our inventory unwind with better line of sight to the elimination of the 737 and 787 dual factories. Keep in mind that correcting non - conformances gets exponentially easier when this inventory has been delivered to our customers. BDS will be further along in recovery as I described earlier. BGS will still be generating mid - teen margins, executing on its high cash conversion, capital efficient, disciplined growth model. And all of this will underwrite our continued strong liquidity position and enable us to further delever the balance sheet early next year. With that, back over to Dave for closing comments.", "ground_truth_output": { "entities": [ { "id": 44, "label": "Traditional", "start_offset": 149, "end_offset": 156, "text": "revenue", "global_span": [ 10274, 10281 ] }, { "id": 45, "label": "Value", "start_offset": 161, "end_offset": 174, "text": "$18.1 billion", "global_span": [ 10286, 10299 ] }, { "id": 46, "label": "Value", "start_offset": 187, "end_offset": 190, "text": "13%", "global_span": [ 10312, 10315 ] }, { "id": 47, "label": "Traditional", "start_offset": 191, "end_offset": 195, "text": "year", "global_span": [ 10316, 10320 ] }, { "id": 48, "label": "Traditional", "start_offset": 198, "end_offset": 202, "text": "over", "global_span": [ 10323, 10327 ] }, { "id": 49, "label": "Traditional", "start_offset": 205, "end_offset": 209, "text": "year", "global_span": [ 10330, 10334 ] }, { "id": 50, "label": "Traditional", "start_offset": 294, "end_offset": 315, "text": "Core operating margin", "global_span": [ 10419, 10440 ] }, { "id": 51, "label": "Value", "start_offset": 335, "end_offset": 343, "text": "minus 6%", "global_span": [ 10460, 10468 ] }, { "id": 52, "label": "Value", "start_offset": 377, "end_offset": 382, "text": "$3.26", "global_span": [ 10502, 10507 ] }, { "id": 53, "label": "Traditional", "start_offset": 384, "end_offset": 391, "text": "Margins", "global_span": [ 10509, 10516 ] }, { "id": 54, "label": "Traditional", "start_offset": 396, "end_offset": 399, "text": "EPS", "global_span": [ 10521, 10524 ] }, { "id": 55, "label": "Traditional", "start_offset": 614, "end_offset": 628, "text": "Free cash flow", "global_span": [ 10739, 10753 ] }, { "id": 56, "label": "Value", "start_offset": 644, "end_offset": 656, "text": "$310 million", "global_span": [ 10769, 10781 ] }, { "id": 57, "label": "Value", "start_offset": 836, "end_offset": 839, "text": "398", "global_span": [ 10961, 10964 ] }, { "id": 58, "label": "Value", "start_offset": 877, "end_offset": 880, "text": "150", "global_span": [ 11002, 11005 ] }, { "id": 59, "label": "Non_Traditional", "start_offset": 881, "end_offset": 900, "text": "MAX-10s for Ryanair", "global_span": [ 11006, 11025 ] }, { "id": 60, "label": "Value", "start_offset": 902, "end_offset": 904, "text": "50", "global_span": [ 11027, 11029 ] }, { "id": 61, "label": "Non_Traditional", "start_offset": 905, "end_offset": 919, "text": "87s for United", "global_span": [ 11030, 11044 ] }, { "id": 62, "label": "Value", "start_offset": 924, "end_offset": 926, "text": "39", "global_span": [ 11049, 11051 ] }, { "id": 63, "label": "Non_Traditional", "start_offset": 927, "end_offset": 957, "text": "87s for Saudi Arabian Airlines", "global_span": [ 11052, 11082 ] }, { "id": 64, "label": "Value", "start_offset": 976, "end_offset": 981, "text": "5,100", "global_span": [ 11101, 11106 ] }, { "id": 65, "label": "Non_Traditional", "start_offset": 982, "end_offset": 991, "text": "airplanes", "global_span": [ 11107, 11116 ] }, { "id": 66, "label": "Non_Traditional", "start_offset": 999, "end_offset": 1006, "text": "backlog", "global_span": [ 11124, 11131 ] }, { "id": 67, "label": "Value", "start_offset": 1017, "end_offset": 1029, "text": "$392 billion", "global_span": [ 11142, 11154 ] }, { "id": 68, "label": "Non_Traditional", "start_offset": 1035, "end_offset": 1044, "text": "delivered", "global_span": [ 11160, 11169 ] }, { "id": 69, "label": "Value", "start_offset": 1045, "end_offset": 1048, "text": "105", "global_span": [ 11170, 11173 ] }, { "id": 70, "label": "Non_Traditional", "start_offset": 1049, "end_offset": 1058, "text": "airplanes", "global_span": [ 11174, 11183 ] }, { "id": 71, "label": "Traditional", "start_offset": 1079, "end_offset": 1086, "text": "revenue", "global_span": [ 11204, 11211 ] }, { "id": 72, "label": "Value", "start_offset": 1091, "end_offset": 1103, "text": "$7.9 billion", "global_span": [ 11216, 11228 ] }, { "id": 73, "label": "Value", "start_offset": 1116, "end_offset": 1119, "text": "25%", "global_span": [ 11241, 11244 ] }, { "id": 74, "label": "Traditional", "start_offset": 1120, "end_offset": 1124, "text": "year", "global_span": [ 11245, 11249 ] }, { "id": 75, "label": "Traditional", "start_offset": 1127, "end_offset": 1131, "text": "over", "global_span": [ 11252, 11256 ] }, { "id": 76, "label": "Traditional", "start_offset": 1134, "end_offset": 1138, "text": "year", "global_span": [ 11259, 11263 ] }, { "id": 77, "label": "Traditional", "start_offset": 1176, "end_offset": 1192, "text": "Operating margin", "global_span": [ 11301, 11317 ] }, { "id": 78, "label": "Value", "start_offset": 1197, "end_offset": 1207, "text": "minus 8.6%", "global_span": [ 11322, 11332 ] }, { "id": 79, "label": "Non_Traditional", "start_offset": 1442, "end_offset": 1451, "text": "delivered", "global_span": [ 11567, 11576 ] }, { "id": 80, "label": "Value", "start_offset": 1452, "end_offset": 1454, "text": "70", "global_span": [ 11577, 11579 ] }, { "id": 81, "label": "Non_Traditional", "start_offset": 1455, "end_offset": 1464, "text": "airplanes", "global_span": [ 11580, 11589 ] }, { "id": 82, "label": "Value", "start_offset": 2113, "end_offset": 2116, "text": "375", "global_span": [ 12238, 12241 ] }, { "id": 83, "label": "Value", "start_offset": 2121, "end_offset": 2124, "text": "400", "global_span": [ 12246, 12249 ] }, { "id": 84, "label": "Non_Traditional", "start_offset": 2125, "end_offset": 2134, "text": "airplanes", "global_span": [ 12250, 12259 ] }, { "id": 85, "label": "Value", "start_offset": 2262, "end_offset": 2265, "text": "250", "global_span": [ 12387, 12390 ] }, { "id": 86, "label": "Non_Traditional", "start_offset": 2266, "end_offset": 2279, "text": "MAX airplanes", "global_span": [ 12391, 12404 ] }, { "id": 87, "label": "Non_Traditional", "start_offset": 2682, "end_offset": 2696, "text": "737 transition", "global_span": [ 12807, 12821 ] }, { "id": 88, "label": "Value", "start_offset": 2700, "end_offset": 2702, "text": "38", "global_span": [ 12825, 12827 ] }, { "id": 89, "label": "Non_Traditional", "start_offset": 2703, "end_offset": 2712, "text": "per month", "global_span": [ 12828, 12837 ] }, { "id": 90, "label": "Non_Traditional", "start_offset": 2716, "end_offset": 2720, "text": "year", "global_span": [ 12841, 12845 ] }, { "id": 91, "label": "Non_Traditional", "start_offset": 2723, "end_offset": 2726, "text": "end", "global_span": [ 12848, 12851 ] }, { "id": 92, "label": "Value", "start_offset": 2772, "end_offset": 2774, "text": "50", "global_span": [ 12897, 12899 ] }, { "id": 93, "label": "Non_Traditional", "start_offset": 2775, "end_offset": 2784, "text": "per month", "global_span": [ 12900, 12909 ] }, { "id": 94, "label": "Non_Traditional", "start_offset": 2792, "end_offset": 2796, "text": "2025", "global_span": [ 12917, 12921 ] }, { "id": 95, "label": "Non_Traditional", "start_offset": 2798, "end_offset": 2802, "text": "2026", "global_span": [ 12923, 12927 ] }, { "id": 96, "label": "Non_Traditional", "start_offset": 2822, "end_offset": 2833, "text": "787 program", "global_span": [ 12947, 12958 ] }, { "id": 97, "label": "Value", "start_offset": 2842, "end_offset": 2844, "text": "19", "global_span": [ 12967, 12969 ] }, { "id": 98, "label": "Non_Traditional", "start_offset": 2845, "end_offset": 2855, "text": "deliveries", "global_span": [ 12970, 12980 ] }, { "id": 99, "label": "Value", "start_offset": 2875, "end_offset": 2877, "text": "50", "global_span": [ 13000, 13002 ] }, { "id": 100, "label": "Non_Traditional", "start_offset": 2878, "end_offset": 2882, "text": "year", "global_span": [ 13003, 13007 ] }, { "id": 101, "label": "Non_Traditional", "start_offset": 2885, "end_offset": 2887, "text": "to", "global_span": [ 13010, 13012 ] }, { "id": 102, "label": "Non_Traditional", "start_offset": 2890, "end_offset": 2894, "text": "date", "global_span": [ 13015, 13019 ] }, { "id": 103, "label": "Value", "start_offset": 2912, "end_offset": 2914, "text": "70", "global_span": [ 13037, 13039 ] }, { "id": 104, "label": "Value", "start_offset": 2918, "end_offset": 2920, "text": "80", "global_span": [ 13043, 13045 ] }, { "id": 105, "label": "Non_Traditional", "start_offset": 2921, "end_offset": 2931, "text": "deliveries", "global_span": [ 13046, 13056 ] }, { "id": 106, "label": "Non_Traditional", "start_offset": 2937, "end_offset": 2941, "text": "year", "global_span": [ 13062, 13066 ] }, { "id": 107, "label": "Non_Traditional", "start_offset": 2968, "end_offset": 2978, "text": "production", "global_span": [ 13093, 13103 ] }, { "id": 108, "label": "Value", "start_offset": 2982, "end_offset": 2986, "text": "five", "global_span": [ 13107, 13111 ] }, { "id": 109, "label": "Non_Traditional", "start_offset": 2987, "end_offset": 2996, "text": "per month", "global_span": [ 13112, 13121 ] }, { "id": 110, "label": "Value", "start_offset": 3032, "end_offset": 3034, "text": "10", "global_span": [ 13157, 13159 ] }, { "id": 111, "label": "Non_Traditional", "start_offset": 3035, "end_offset": 3044, "text": "per month", "global_span": [ 13160, 13169 ] }, { "id": 112, "label": "Non_Traditional", "start_offset": 3052, "end_offset": 3056, "text": "2025", "global_span": [ 13177, 13181 ] }, { "id": 113, "label": "Non_Traditional", "start_offset": 3058, "end_offset": 3062, "text": "2026", "global_span": [ 13183, 13187 ] }, { "id": 114, "label": "Value", "start_offset": 3101, "end_offset": 3103, "text": "75", "global_span": [ 13226, 13228 ] }, { "id": 115, "label": "Non_Traditional", "start_offset": 3104, "end_offset": 3113, "text": "airplanes", "global_span": [ 13229, 13238 ] }, { "id": 116, "label": "Non_Traditional", "start_offset": 3117, "end_offset": 3126, "text": "inventory", "global_span": [ 13242, 13251 ] }, { "id": 117, "label": "Value", "start_offset": 3229, "end_offset": 3241, "text": "$244 million", "global_span": [ 13354, 13366 ] }, { "id": 118, "label": "Traditional", "start_offset": 3245, "end_offset": 3259, "text": "abnormal costs", "global_span": [ 13370, 13384 ] }, { "id": 119, "label": "Value", "start_offset": 3314, "end_offset": 3324, "text": "$3 billion", "global_span": [ 13439, 13449 ] }, { "id": 120, "label": "Value", "start_offset": 3534, "end_offset": 3546, "text": "$180 million", "global_span": [ 13659, 13671 ] }, { "id": 121, "label": "Traditional", "start_offset": 3550, "end_offset": 3564, "text": "abnormal costs", "global_span": [ 13675, 13689 ] }, { "id": 122, "label": "Value", "start_offset": 3643, "end_offset": 3653, "text": "$1 billion", "global_span": [ 13768, 13778 ] }, { "id": 123, "label": "Value", "start_offset": 4043, "end_offset": 4053, "text": "$6 billion", "global_span": [ 14168, 14178 ] }, { "id": 124, "label": "Traditional", "start_offset": 4057, "end_offset": 4063, "text": "orders", "global_span": [ 14182, 14188 ] }, { "id": 125, "label": "Traditional", "start_offset": 4092, "end_offset": 4099, "text": "backlog", "global_span": [ 14217, 14224 ] }, { "id": 126, "label": "Value", "start_offset": 4114, "end_offset": 4125, "text": "$58 billion", "global_span": [ 14239, 14250 ] }, { "id": 127, "label": "Traditional", "start_offset": 4127, "end_offset": 4134, "text": "Revenue", "global_span": [ 14252, 14259 ] }, { "id": 128, "label": "Value", "start_offset": 4139, "end_offset": 4151, "text": "$5.5 billion", "global_span": [ 14264, 14276 ] }, { "id": 129, "label": "Traditional", "start_offset": 4170, "end_offset": 4174, "text": "year", "global_span": [ 14295, 14299 ] }, { "id": 130, "label": "Traditional", "start_offset": 4177, "end_offset": 4181, "text": "over", "global_span": [ 14302, 14306 ] }, { "id": 131, "label": "Traditional", "start_offset": 4184, "end_offset": 4188, "text": "year", "global_span": [ 14309, 14313 ] }, { "id": 132, "label": "Value", "start_offset": 4207, "end_offset": 4209, "text": "28", "global_span": [ 14332, 14334 ] }, { "id": 133, "label": "Non_Traditional", "start_offset": 4210, "end_offset": 4218, "text": "aircraft", "global_span": [ 14335, 14343 ] }, { "id": 134, "label": "Traditional", "start_offset": 4220, "end_offset": 4236, "text": "Operating margin", "global_span": [ 14345, 14361 ] }, { "id": 135, "label": "Value", "start_offset": 4241, "end_offset": 4252, "text": "minus 16.9%", "global_span": [ 14366, 14377 ] }, { "id": 136, "label": "Value", "start_offset": 4331, "end_offset": 4339, "text": "minus 9%", "global_span": [ 14456, 14464 ] }, { "id": 137, "label": "Value", "start_offset": 4361, "end_offset": 4372, "text": "482 million", "global_span": [ 14486, 14497 ] }, { "id": 138, "label": "Value", "start_offset": 4620, "end_offset": 4628, "text": "8 points", "global_span": [ 14745, 14753 ] }, { "id": 139, "label": "Value", "start_offset": 4665, "end_offset": 4677, "text": "$315 million", "global_span": [ 14790, 14802 ] }, { "id": 140, "label": "Traditional", "start_offset": 4873, "end_offset": 4886, "text": "material cost", "global_span": [ 14998, 15011 ] }, { "id": 141, "label": "Value", "start_offset": 4931, "end_offset": 4943, "text": "$136 million", "global_span": [ 15056, 15068 ] }, { "id": 142, "label": "Value", "start_offset": 6235, "end_offset": 6238, "text": "60%", "global_span": [ 16360, 16363 ] }, { "id": 143, "label": "Traditional", "start_offset": 6246, "end_offset": 6253, "text": "revenue", "global_span": [ 16371, 16378 ] }, { "id": 144, "label": "Non_Traditional", "start_offset": 8004, "end_offset": 8043, "text": "successful crewed flight test next year", "global_span": [ 18129, 18168 ] }, { "id": 145, "label": "Non_Traditional", "start_offset": 8150, "end_offset": 8154, "text": "T-7A", "global_span": [ 18275, 18279 ] }, { "id": 146, "label": "Non_Traditional", "start_offset": 8164, "end_offset": 8173, "text": "delivered", "global_span": [ 18289, 18298 ] }, { "id": 147, "label": "Value", "start_offset": 8178, "end_offset": 8183, "text": "first", "global_span": [ 18303, 18308 ] }, { "id": 148, "label": "Non_Traditional", "start_offset": 8184, "end_offset": 8192, "text": "aircraft", "global_span": [ 18309, 18317 ] }, { "id": 149, "label": "Non_Traditional", "start_offset": 8200, "end_offset": 8209, "text": "Air Force", "global_span": [ 18325, 18334 ] }, { "id": 150, "label": "Non_Traditional", "start_offset": 8285, "end_offset": 8290, "text": "MQ-25", "global_span": [ 18410, 18415 ] }, { "id": 151, "label": "Value", "start_offset": 8352, "end_offset": 8366, "text": "transition out", "global_span": [ 18477, 18491 ] }, { "id": 152, "label": "Non_Traditional", "start_offset": 8374, "end_offset": 8391, "text": "development phase", "global_span": [ 18499, 18516 ] }, { "id": 153, "label": "Value", "start_offset": 9142, "end_offset": 9152, "text": "$5 billion", "global_span": [ 19267, 19277 ] }, { "id": 154, "label": "Traditional", "start_offset": 9156, "end_offset": 9162, "text": "orders", "global_span": [ 19281, 19287 ] }, { "id": 155, "label": "Traditional", "start_offset": 9191, "end_offset": 9198, "text": "backlog", "global_span": [ 19316, 19323 ] }, { "id": 156, "label": "Value", "start_offset": 9207, "end_offset": 9218, "text": "$18 billion", "global_span": [ 19332, 19343 ] }, { "id": 157, "label": "Traditional", "start_offset": 9220, "end_offset": 9227, "text": "Revenue", "global_span": [ 19345, 19352 ] }, { "id": 158, "label": "Value", "start_offset": 9232, "end_offset": 9244, "text": "$4.8 billion", "global_span": [ 19357, 19369 ] }, { "id": 159, "label": "Value", "start_offset": 9249, "end_offset": 9251, "text": "9%", "global_span": [ 19374, 19376 ] }, { "id": 160, "label": "Traditional", "start_offset": 9252, "end_offset": 9256, "text": "year", "global_span": [ 19377, 19381 ] }, { "id": 161, "label": "Traditional", "start_offset": 9259, "end_offset": 9263, "text": "over", "global_span": [ 19384, 19388 ] }, { "id": 162, "label": "Traditional", "start_offset": 9266, "end_offset": 9270, "text": "year", "global_span": [ 19391, 19395 ] }, { "id": 163, "label": "Traditional", "start_offset": 9322, "end_offset": 9339, "text": "Operating margins", "global_span": [ 19447, 19464 ] }, { "id": 164, "label": "Value", "start_offset": 9354, "end_offset": 9359, "text": "16.3%", "global_span": [ 19479, 19484 ] }, { "id": 165, "label": "Traditional", "start_offset": 9558, "end_offset": 9584, "text": "cash marketable securities", "global_span": [ 19683, 19709 ] }, { "id": 166, "label": "Value", "start_offset": 9610, "end_offset": 9623, "text": "$13.4 billion", "global_span": [ 19735, 19748 ] }, { "id": 167, "label": "Value", "start_offset": 9667, "end_offset": 9680, "text": "$52.3 billion", "global_span": [ 19792, 19805 ] }, { "id": 168, "label": "Value", "start_offset": 9699, "end_offset": 9710, "text": "$10 billion", "global_span": [ 19824, 19835 ] }, { "id": 169, "label": "Traditional", "start_offset": 9714, "end_offset": 9741, "text": "revolving credit facilities", "global_span": [ 19839, 19866 ] }, { "id": 170, "label": "Value", "start_offset": 10186, "end_offset": 10196, "text": "$3 billion", "global_span": [ 20311, 20321 ] }, { "id": 171, "label": "Value", "start_offset": 10200, "end_offset": 10210, "text": "$5 billion", "global_span": [ 20325, 20335 ] }, { "id": 172, "label": "Traditional", "start_offset": 10214, "end_offset": 10239, "text": "free cash flow generation", "global_span": [ 20339, 20364 ] }, { "id": 173, "label": "Non_Traditional", "start_offset": 10589, "end_offset": 10613, "text": "Global passenger traffic", "global_span": [ 20714, 20738 ] }, { "id": 174, "label": "Value", "start_offset": 10628, "end_offset": 10631, "text": "30%", "global_span": [ 20753, 20756 ] }, { "id": 175, "label": "Non_Traditional", "start_offset": 10632, "end_offset": 10636, "text": "year", "global_span": [ 20757, 20761 ] }, { "id": 176, "label": "Non_Traditional", "start_offset": 10639, "end_offset": 10641, "text": "on", "global_span": [ 20764, 20766 ] }, { "id": 177, "label": "Non_Traditional", "start_offset": 10644, "end_offset": 10648, "text": "year", "global_span": [ 20769, 20773 ] }, { "id": 178, "label": "Value", "start_offset": 10669, "end_offset": 10672, "text": "96%", "global_span": [ 20794, 20797 ] }, { "id": 179, "label": "Value", "start_offset": 10699, "end_offset": 10703, "text": "109%", "global_span": [ 20824, 20828 ] }, { "id": 180, "label": "Value", "start_offset": 10717, "end_offset": 10720, "text": "89%", "global_span": [ 20842, 20845 ] }, { "id": 181, "label": "Non_Traditional", "start_offset": 10721, "end_offset": 10734, "text": "international", "global_span": [ 20846, 20859 ] }, { "id": 182, "label": "Non_Traditional", "start_offset": 10736, "end_offset": 10757, "text": "Cargo remains healthy", "global_span": [ 20861, 20882 ] }, { "id": 183, "label": "Non_Traditional", "start_offset": 10777, "end_offset": 10830, "text": "first month with annual cargo growth since early 2022", "global_span": [ 20902, 20955 ] }, { "id": 184, "label": "Traditional", "start_offset": 11646, "end_offset": 11667, "text": "full year tax expense", "global_span": [ 21771, 21792 ] }, { "id": 185, "label": "Value", "start_offset": 11685, "end_offset": 11697, "text": "$250 million", "global_span": [ 21810, 21822 ] }, { "id": 186, "label": "Non_Traditional", "start_offset": 12005, "end_offset": 12008, "text": "787", "global_span": [ 22130, 22133 ] }, { "id": 187, "label": "Non_Traditional", "start_offset": 12029, "end_offset": 12039, "text": "production", "global_span": [ 22154, 22164 ] }, { "id": 188, "label": "Value", "start_offset": 12043, "end_offset": 12057, "text": "five per month", "global_span": [ 22168, 22182 ] }, { "id": 189, "label": "Value", "start_offset": 12089, "end_offset": 12101, "text": "10 per month", "global_span": [ 22214, 22226 ] }, { "id": 251, "label": "non_traditional", "text": "Third quarter ", "start_offset": 135, "end_offset": 149, "global_span": [ 10260, 10274 ] }, { "id": 254, "label": "Traditional", "text": " in the quarter was", "start_offset": 315, "end_offset": 334, "global_span": [ 10440, 10459 ] }, { "id": 255, "label": "Traditional", "text": "core loss per share", "start_offset": 353, "end_offset": 372, "global_span": [ 10478, 10497 ] }, { "id": 256, "label": "Traditional", "text": "usage of", "start_offset": 635, "end_offset": 643, "global_span": [ 10760, 10768 ] }, { "id": 257, "label": "Traditional", "text": "quarter", "start_offset": 3088, "end_offset": 3095, "global_span": [ 13213, 13220 ] }, { "id": 258, "label": "Traditional", "text": "Boeing Commercial Airplanes. BCA booked ", "start_offset": 796, "end_offset": 836, "global_span": [ 10921, 10961 ] }, { "id": 261, "label": "Traditional", "text": "for the year.", "start_offset": 2135, "end_offset": 2148, "global_span": [ 12260, 12273 ] }, { "id": 262, "label": "Traditional", "text": "in the quarter", "start_offset": 1059, "end_offset": 1073, "global_span": [ 11184, 11198 ] }, { "id": 263, "label": "Traditional", "text": "in the quarte", "start_offset": 657, "end_offset": 670, "global_span": [ 10782, 10795 ] }, { "id": 264, "label": "Traditional", "text": "net orders in the quarter", "start_offset": 840, "end_offset": 865, "global_span": [ 10965, 10990 ] }, { "id": 265, "label": "Traditional", "text": "BCA ", "start_offset": 1031, "end_offset": 1035, "global_span": [ 11156, 11160 ] }, { "id": 266, "label": "Traditional", "text": "BCA", "start_offset": 959, "end_offset": 962, "global_span": [ 11084, 11087 ] }, { "id": 267, "label": "non_traditional", "text": "737", "start_offset": 1434, "end_offset": 1437, "global_span": [ 11559, 11562 ] }, { "id": 268, "label": "non_traditional", "text": "in the quarter", "start_offset": 1465, "end_offset": 1479, "global_span": [ 11590, 11604 ] }, { "id": 269, "label": "non_traditional", "text": "The quarter ended", "start_offset": 2225, "end_offset": 2242, "global_span": [ 12350, 12367 ] }, { "id": 270, "label": "non_traditional", "text": "inventory", "start_offset": 2283, "end_offset": 2292, "global_span": [ 12408, 12417 ] }, { "id": 271, "label": "non_traditional", "text": "in the quarte", "start_offset": 2856, "end_offset": 2869, "global_span": [ 12981, 12994 ] }, { "id": 272, "label": "non_traditional", "text": "Boeing Defense and Space. BDS", "start_offset": 4006, "end_offset": 4035, "global_span": [ 14131, 14160 ] }, { "id": 273, "label": "non_traditional", "text": "delivered ", "start_offset": 4197, "end_offset": 4207, "global_span": [ 14322, 14332 ] }, { "id": 274, "label": "non_traditional", "text": "quarter", "start_offset": 4260, "end_offset": 4267, "global_span": [ 14385, 14392 ] }, { "id": 275, "label": "non_traditional", "text": "margins ", "start_offset": 4307, "end_offset": 4315, "global_span": [ 14432, 14440 ] }, { "id": 276, "label": "Traditional", "text": "early September", "start_offset": 4272, "end_offset": 4287, "global_span": [ 14397, 14412 ] }, { "id": 277, "label": "non_traditional", "text": "charge on the VC-25B fixed price development program", "start_offset": 4373, "end_offset": 4425, "global_span": [ 14498, 14550 ] }, { "id": 278, "label": "non_traditional", "text": "MQ-25program", "start_offset": 4968, "end_offset": 4980, "global_span": [ 15093, 15105 ] }, { "id": 279, "label": "non_traditional", "text": "2025, 2026 time frame", "start_offset": 8415, "end_offset": 8436, "global_span": [ 18540, 18561 ] }, { "id": 280, "label": "Traditional", "text": "Boeing Global Services. BGS", "start_offset": 9072, "end_offset": 9099, "global_span": [ 19197, 19224 ] }, { "id": 281, "label": "Traditional", "text": "quarter", "start_offset": 9174, "end_offset": 9181, "global_span": [ 19299, 19306 ] }, { "id": 282, "label": "Traditional", "text": "ended the quarter", "start_offset": 9589, "end_offset": 9606, "global_span": [ 19714, 19731 ] }, { "id": 283, "label": "Traditional", "text": "debt", "start_offset": 9632, "end_offset": 9636, "global_span": [ 19757, 19761 ] }, { "id": 284, "label": "Traditional", "text": "pre - pandemic levels", "start_offset": 10676, "end_offset": 10697, "global_span": [ 20801, 20822 ] }, { "id": 285, "label": "non_traditional", "text": "domestic ", "start_offset": 10704, "end_offset": 10713, "global_span": [ 20829, 20838 ] }, { "id": 286, "label": "non_traditional", "text": " 2025, 2026.", "start_offset": 12104, "end_offset": 12116, "global_span": [ 22229, 22241 ] } ], "relations": [ { "id": 19, "entity_ids": [ 44, 45, 251 ], "description": "Value_of" }, { "id": 20, "entity_ids": [ 44, 46, 47, 48, 49 ], "description": "Value_of" }, { "id": 21, "entity_ids": [ 50, 51, 254 ], "description": "Value_of" }, { "id": 22, "entity_ids": [ 52, 255 ], "description": "Value_of" }, { "id": 23, "entity_ids": [ 55, 56, 256 ], "description": "Value_of" }, { "id": 24, "entity_ids": [ 55, 56, 256, 263 ], "description": "Value_of" }, { "id": 25, "entity_ids": [ 57, 258, 264 ], "description": "Value_of" }, { "id": 26, "entity_ids": [ 58, 59 ], "description": "Value_of" }, { "id": 27, "entity_ids": [ 60, 61 ], "description": "Value_of" }, { "id": 28, "entity_ids": [ 62, 63 ], "description": "Value_of" }, { "id": 29, "entity_ids": [ 68, 69, 70, 262, 265 ], "description": "Value_of" }, { "id": 30, "entity_ids": [ 64, 65, 66, 266 ], "description": "Value_of" }, { "id": 31, "entity_ids": [ 66, 67, 266 ], "description": "Value_of" }, { "id": 32, "entity_ids": [ 71, 72 ], "description": "Value_of" }, { "id": 33, "entity_ids": [ 71, 73, 74, 75, 76 ], "description": "Value_of" }, { "id": 34, "entity_ids": [ 77, 78 ], "description": "Value_of" }, { "id": 35, "entity_ids": [ 79, 80, 81, 267, 268 ], "description": "Value_of" }, { "id": 36, "entity_ids": [ 82, 83, 84, 261 ], "description": "Value_of" }, { "id": 37, "entity_ids": [ 85, 86, 269, 270 ], "description": "Value_of" }, { "id": 38, "entity_ids": [ 87, 88, 89, 90, 91 ], "description": "Value_of" }, { "id": 39, "entity_ids": [ 92, 93, 94, 95 ], "description": "Value_of" }, { "id": 40, "entity_ids": [ 96, 97, 98, 271 ], "description": "Value_of" }, { "id": 41, "entity_ids": [ 96, 98, 99, 100, 101, 102 ], "description": "Value_of" }, { "id": 42, "entity_ids": [ 96, 103, 104, 105, 106 ], "description": "Value_of" }, { "id": 43, "entity_ids": [ 107, 108, 109 ], "description": "Value_of" }, { "id": 44, "entity_ids": [ 107, 110, 111, 112, 113 ], "description": "Value_of" }, { "id": 45, "entity_ids": [ 114, 115, 116, 257 ], "description": "Value_of" }, { "id": 46, "entity_ids": [ 117, 118 ], "description": "Value_of" }, { "id": 47, "entity_ids": [ 120, 121 ], "description": "Value_of" }, { "id": 48, "entity_ids": [ 123, 124, 272 ], "description": "Value_of" }, { "id": 49, "entity_ids": [ 125, 126 ], "description": "Value_of" }, { "id": 50, "entity_ids": [ 127, 128, 272 ], "description": "Value_of" }, { "id": 51, "entity_ids": [ 125, 126, 272 ], "description": "Value_of" }, { "id": 52, "entity_ids": [ 132, 133, 273 ], "description": "Value_of" }, { "id": 53, "entity_ids": [ 134, 135, 274 ], "description": "Value_of" }, { "id": 54, "entity_ids": [ 136, 275, 276 ], "description": "Value_of" }, { "id": 55, "entity_ids": [ 137, 277 ], "description": "Value_of" }, { "id": 56, "entity_ids": [ 140, 141, 278 ], "description": "Value_of" }, { "id": 57, "entity_ids": [ 145, 146, 147, 148, 149 ], "description": "Value_of" }, { "id": 58, "entity_ids": [ 150, 151, 152, 279 ], "description": "Value_of" }, { "id": 59, "entity_ids": [ 153, 154, 280 ], "description": "Value_of" }, { "id": 60, "entity_ids": [ 153, 154, 280, 281 ], "description": "Value_of" }, { "id": 61, "entity_ids": [ 155, 156, 280 ], "description": "Value_of" }, { "id": 62, "entity_ids": [ 157, 158 ], "description": "Value_of" }, { "id": 63, "entity_ids": [ 157, 159, 160, 161, 162 ], "description": "Value_of" }, { "id": 64, "entity_ids": [ 163, 164, 280 ], "description": "Value_of" }, { "id": 65, "entity_ids": [ 157, 158, 280 ], "description": "Value_of" }, { "id": 66, "entity_ids": [ 157, 159, 160, 161, 162, 280 ], "description": "Value_of" }, { "id": 67, "entity_ids": [ 165, 166, 282 ], "description": "Value_of" }, { "id": 68, "entity_ids": [ 165, 166, 280, 282 ], "description": "Value_of" }, { "id": 69, "entity_ids": [ 167, 280, 283 ], "description": "Value_of" }, { "id": 70, "entity_ids": [ 168, 169, 280 ], "description": "Value_of" }, { "id": 71, "entity_ids": [ 170, 171, 172 ], "description": "Value_of" }, { "id": 72, "entity_ids": [ 173, 174, 175, 176, 177 ], "description": "Value_of" }, { "id": 73, "entity_ids": [ 173, 178, 284 ], "description": "Value_of" }, { "id": 74, "entity_ids": [ 173, 179, 284, 285 ], "description": "Value_of" }, { "id": 75, "entity_ids": [ 173, 180, 181 ], "description": "Value_of" }, { "id": 76, "entity_ids": [ 184, 185 ], "description": "Value_of" }, { "id": 77, "entity_ids": [ 186, 187, 188, 189, 286 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Yes. Thanks, Brian. In closing, I just want to make a couple of comments and double down on the resiliency of our recovery. We 've had no shortage of challenges this year. You all know that. Conformance items, development hurdles, external challenges within the supply chain and even logistics routes. These are not uncommon in our industry. I ' ve heard from a few of you wondering if we ' ve lost a step in this recovery. You might not be surprised to hear that I view it as exactly the opposite. Over the last several years, we ' ve added rigor around our quality processes. We ' ve worked hard to instill a culture of speaking up and transparently bringing forward any issue, no matter the size, so that we can get things right for a bright future. As a result, we 're finding items that we need to resolve. They 're not newly created defects in the system. Instead, thanks to the culture we 're building, we identified items from the past that we now have the rigor and the focus to fix once and for all. Our shadow factories will be shut down. So this process of transparency and change can be difficult in the moment, but I ' m proud of our team. I ' m confident; we 'll look back on this time period as when we got things right and we set Boeing on the right course. We still have work to do, but progress is clear and our focus is long - term. We 're on the right path to restoring our operational and financial strength. And we thank you for your patience. Okay. Now, let 's turn it over to questions.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Operator: Thank you. [Operator Instructions ] And our first question will come from the line of Doug Harned from Bernstein. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "Doug Harned: Yes, good morning. Thank you. Talking about the recovery here, when we look at the 737 MAX ramp, we had thought you 'd be at 38 a month production back in August, and we were looking forward to a new line that should be up and running at Everett in 2025, which looks to us that we give you capacity for well over 60 a month. But now that 38 a month rate is coming – is still to come later this year. And if I separate the bottlenecks here into three topics, sort of engines, Spirit, and everything else, engines appear fine. You ’ ve got a new leadership at Spirit, a new agreement. So this is not just one part, but I guess how much has your longer - term ramp outlook changed, given the Spirit issues you ’ ve had this year? And if you could take those Spirit risks off the table, what bottlenecks are still out there in the everything else category for the MAX? And to put it all together, what could this ramp look like if you can avoid quality escapes like the ones we have seen this year?", "ground_truth_output": { "entities": [ { "id": 190, "label": "Non_Traditional", "start_offset": 97, "end_offset": 104, "text": "737 MAX", "global_span": [ 24650, 24657 ] }, { "id": 191, "label": "Value", "start_offset": 139, "end_offset": 149, "text": "38 a month", "global_span": [ 24692, 24702 ] }, { "id": 192, "label": "Non_Traditional", "start_offset": 150, "end_offset": 160, "text": "production", "global_span": [ 24703, 24713 ] }, { "id": 193, "label": "Non_Traditional", "start_offset": 169, "end_offset": 175, "text": "August", "global_span": [ 24722, 24728 ] }, { "id": 194, "label": "Value", "start_offset": 327, "end_offset": 337, "text": "60 a month", "global_span": [ 24880, 24890 ] }, { "id": 195, "label": "Value", "start_offset": 352, "end_offset": 362, "text": "38 a month", "global_span": [ 24905, 24915 ] }, { "id": 196, "label": "Non_Traditional", "start_offset": 363, "end_offset": 367, "text": "rate", "global_span": [ 24916, 24920 ] } ], "relations": [ { "id": 78, "entity_ids": [ 190, 191, 192, 193 ], "description": "Value_of" }, { "id": 79, "entity_ids": [ 190, 194, 195, 196 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Yes, Doug, that ’s the money question. We think we are synced perfectly with the constraints that we know. You talked about engine constraints. We have as clear and as transparent a relationship as we could possibly have with the GE and CFM teams. The rates that we have outlined in our guidance reflect those constraints. We all could go much higher, much faster, if it were strictly a demand question. But we have to listen hard to those constraints. So we are there. On Spirit, we really do believe that the commercial agreement and I can have Brian make a comment on; he was in the center of that negotiation. The commercial agreement gives them the resources and the breathing room they need to get ahead of our rate forecast. And maybe even more importantly, I think the selection of Pat at exactly this moment in time to sort of get them really focused on factory performance I ’ m quite optimistic and quite pleased with. We ’ ve had just in the last 30 days as many interactions with Pat as we ’ ve had over the last year, even though we ’ ve had more than 100 people embedded at Spirit. So, all the signs are good there. I feel like we took a major step forward on relieving that particular constraint. And as you know, that is mostly a conformance constraint. I got to tell you, these fuselages, man, they have been gone over with a microscope in light of what we ’ ve experienced here in the last four months. So all that said, those are – you correctly articulated the constraints that we ’ ve had to deal with. On the all other, we had one that has really taken aggressive steps and gotten ahead of us. And so I ’ m feeling better about all other than I have in quite a long time just because there was another one embedded. I ’m not going to mention names. So anyway, that ’s it in a nutshell, I am always tempted based on demand to tell you we can do more than 50 and get to 60 and we are physically capacitized to do it. You ’re correct in that. But I ca n’t call it out until the supply chain constraints can make it. And they have n’t yet to get to those kinds of numbers. But we have a couple of years to work it, and we ’ll continue to work it. But right now, everything we ’re doing is based on the constraints we know. And that ’s what we ’ ve outlined to the industry. And even in these last just several months with the non - conformance issues that have sort of constrained our delivery, as we ’ ve said many times, we have kept our master schedule intact to get to that 38. We ’re definitely building inventory in the process, and we ’re paying our suppliers. So they ’re not second guessing where we ’re going to end up. And we think we ’re going to have a little bit of buffer, particularly at the front end in light of what we ’ ve just experienced.", "ground_truth_output": { "entities": [ { "id": 197, "label": "Non_Traditional", "start_offset": 1836, "end_offset": 1859, "text": "tempted based on demand", "global_span": [ 27397, 27420 ] }, { "id": 198, "label": "Value", "start_offset": 1892, "end_offset": 1894, "text": "50", "global_span": [ 27453, 27455 ] }, { "id": 199, "label": "Value", "start_offset": 1906, "end_offset": 1908, "text": "60", "global_span": [ 27467, 27469 ] } ], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Doug Harned: And is there any point that we should be looking toward where you might have more clarity on how that whole supply chain is going to come together for this?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Yes, first of all, we ’ll definitely update guidance for next year as we get into the early part of next year, put these non - conformances in a rear view mirror once and for all, get to a stable rate at 38, and then we ’re going to be anxious to build from there as fast as we can. We will give guidance based on everything we know early in that year. So not avoiding it now, but its best we get these things in a rear view mirror. And the good news is we really do have these in a box with respect to the scope of work that ’s required and now it ’s just executing against it. And our teams have done a pretty good job on that.", "ground_truth_output": { "entities": [ { "id": 200, "label": "Non_Traditional", "start_offset": 204, "end_offset": 215, "text": "stable rate", "global_span": [ 28729, 28740 ] }, { "id": 201, "label": "Value", "start_offset": 219, "end_offset": 221, "text": "38", "global_span": [ 28744, 28746 ] } ], "relations": [ { "id": 80, "entity_ids": [ 200, 201 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Doug Harned: Okay. Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Yes.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Operator: Thank you. The next question is from the line of Jason Gursky with Citi. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Jason Gursky: Good morning, everybody. Brian, you made some comments in September about expectations for cash flow in 2024 and the past two year goals in 2025 and described things back in September potentially being nonlinear. So you ’ ve had some things that have happened since then, including the push out of some deliveries into 2024. You ’ ve incurred some more charges, I think that were a bit greater than you were expecting in the Defense business. I ’ m wondering if you can kind of update us on the current thought on 2024 cash flow and kind of the puts and takes that you ’re expecting. What are the good guys, what are the bad guys relative to 2023? And then maybe just provide us some thoughts on the quantum of cash that you expect to generate at the company, 2023, 2024, 2025 and 2026, given all that ’s occurred here, particularly in the defense business here since you lead out those goals at your Investor Day last year, whether the quantum of cash that you expect to generate over those four years has changed materially? Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Brian West: Yes. Thanks, Jason. Let me start with the quantum and the 2025, 2026 time frame. It ’s $10 billion. And we continue to have line of sight to hitting that target. I think that ’s most important. In terms of how we get from where we land in 2023 to that moment, yes, going to be some things we ’ ve got to deal with, not going to be linear, but we ’ ve got some things that feel good about in terms of momentum. Let me just highlight a few. Of course, we ’ll be more specific in January on next year ’s free cash flow guidance. But we expect to be higher. It ’s too early to be that specific, but it will be underwritten by higher BCA deliveries, both on the 37 and the 87. We ’ll have made progress on the inventory wind down that Dave mentioned. And we ’re also going to factor in the 777X ramp. So those things are pretty discrete, and we just got to follow our ability to deliver in a stable environment. BGS will be steady. BDS, as you point out, we expect cash flows next year to be better than there this year, but still likely a drag, mostly factoring in the impact of some of the charges that you mentioned that we just got to put behind us. So, we ’ll spell all of this out in January once we finish our planning cycle and get through 2023. But the most important thing to remember is that quantum in 2025, 2026 is $10 billion. And all of the levers that we have to go from where we land this year to at that point are still very clear to us and underwritten by execution, and we know how to do that.", "ground_truth_output": { "entities": [ { "id": 202, "label": "Non_Traditional", "start_offset": 55, "end_offset": 62, "text": "quantum", "global_span": [ 30422, 30429 ] }, { "id": 203, "label": "Non_Traditional", "start_offset": 71, "end_offset": 75, "text": "2025", "global_span": [ 30438, 30442 ] }, { "id": 204, "label": "Non_Traditional", "start_offset": 77, "end_offset": 92, "text": "2026 time frame", "global_span": [ 30444, 30459 ] }, { "id": 205, "label": "Value", "start_offset": 100, "end_offset": 111, "text": "$10 billion", "global_span": [ 30467, 30478 ] }, { "id": 206, "label": "Traditional", "start_offset": 501, "end_offset": 510, "text": "next year", "global_span": [ 30868, 30877 ] }, { "id": 207, "label": "Traditional", "start_offset": 514, "end_offset": 537, "text": "free cash flow guidance", "global_span": [ 30881, 30904 ] }, { "id": 208, "label": "Traditional", "start_offset": 546, "end_offset": 552, "text": "expect", "global_span": [ 30913, 30919 ] }, { "id": 209, "label": "Value", "start_offset": 559, "end_offset": 565, "text": "higher", "global_span": [ 30926, 30932 ] }, { "id": 210, "label": "Traditional", "start_offset": 1311, "end_offset": 1318, "text": "quantum", "global_span": [ 31678, 31685 ] }, { "id": 211, "label": "Traditional", "start_offset": 1322, "end_offset": 1326, "text": "2025", "global_span": [ 31689, 31693 ] }, { "id": 212, "label": "Traditional", "start_offset": 1328, "end_offset": 1332, "text": "2026", "global_span": [ 31695, 31699 ] }, { "id": 213, "label": "Value", "start_offset": 1336, "end_offset": 1347, "text": "$10 billion", "global_span": [ 31703, 31714 ] } ], "relations": [ { "id": 81, "entity_ids": [ 202, 203, 204, 205 ], "description": "Value_of" }, { "id": 82, "entity_ids": [ 206, 207, 209 ], "description": "Value_of" }, { "id": 83, "entity_ids": [ 210, 211, 212, 213 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "Jason Gursky: Okay. And then, Brian, just if you do n’t mind, the $10 billion quantum out in 2025, 2026, can you talk about the potential for – where we might go from there? What are some of the puts and takes that we might see from a growth perspective beyond that $10 billion?", "ground_truth_output": { "entities": [ { "id": 214, "label": "Value", "start_offset": 67, "end_offset": 78, "text": "$10 billion", "global_span": [ 31955, 31966 ] }, { "id": 215, "label": "Traditional", "start_offset": 79, "end_offset": 86, "text": "quantum", "global_span": [ 31967, 31974 ] }, { "id": 216, "label": "Traditional", "start_offset": 94, "end_offset": 98, "text": "2025", "global_span": [ 31982, 31986 ] }, { "id": 217, "label": "Traditional", "start_offset": 100, "end_offset": 104, "text": "2026", "global_span": [ 31988, 31992 ] } ], "relations": [ { "id": 84, "entity_ids": [ 214, 215, 216, 217 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Brian West: Yes. We ’re still looking forward to that stability, as Dave called it, in the 2025, 2026 time frame in that $10 billion. That ’s where we ’re laser - like focused. Anything beyond that is going to be outside of our planning window. And hopefully, it ’s going to be underwritten by a very attractive robust demand environment, but let ’s get there first.", "ground_truth_output": { "entities": [ { "id": 218, "label": "Value", "start_offset": 122, "end_offset": 133, "text": "$10 billion", "global_span": [ 32289, 32300 ] } ], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "Jason Gursky: Great. Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Operator: Thank you. The next question is from Peter Arment from RW Baird. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Peter Arment: Yes, thanks. Good morning Dave and Brian.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Hi Peter.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Peter Arment: Hey Brian, maybe just to talk about stability there because you just brought it up on – if we look at just the remaining two months of the year, if you ’re going to deliver about 15 737s in the – in October, that kind of implies that you need to deliver high 30s or high 40s if you ’re going to be at the upper end of your range. Just kind of the confidence level around that for November, December, I mean. And if you could update us on when you talked about the – in September, I think about the 75% of the MAX aircraft in storage had to be inspected. What ’s the latest there? And just lastly, is there – is the – getting to 38 a month later in the year, does that impact any of your rate break decisions when you ’re thinking about 2024? Thanks again.", "ground_truth_output": { "entities": [ { "id": 219, "label": "Non_Traditional", "start_offset": 180, "end_offset": 187, "text": "deliver", "global_span": [ 32915, 32922 ] }, { "id": 220, "label": "Value", "start_offset": 194, "end_offset": 196, "text": "15", "global_span": [ 32929, 32931 ] }, { "id": 221, "label": "Non_Traditional", "start_offset": 197, "end_offset": 201, "text": "737s", "global_span": [ 32932, 32936 ] }, { "id": 222, "label": "Value", "start_offset": 643, "end_offset": 653, "text": "38 a month", "global_span": [ 33378, 33388 ] }, { "id": 287, "label": "non_traditional", "text": "in October", "start_offset": 211, "end_offset": 221, "global_span": [ 32946, 32956 ] } ], "relations": [ { "id": 85, "entity_ids": [ 219, 220, 221, 287 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Brian West: Yes, sure. So October will be a little bit light, as I mentioned, with November and December being picked up. Remember, we had a number of airplanes that were ready to be delivered prior to this latest spear NOE, and now we have to work them through the system. We do have a good line of sight to finish in the year, and the team is laser - like focused on meeting this updated set of numbers. And then, of course, we feel good about the free cash flow that will be dragged along with that. In terms of the 75%, that is still the way to think about how we have to touch those inventory airplanes. As we ’ve mentioned, we know the scope. We know what ’s got to happen, and we ’re working our way through finishing that work across that cohort of airplanes. So that has remained unchanged, and it ’s just all the work we have to do in front of us, clear line of sight. And in terms of the rate breaks, largely speaking, we ’ ve had a master schedule out there for some time with the required rate breaks. Of course, we ’re trying to get our way to 50 per month by the 2025, 2026 time frame. None of that ’s changed. And we ’re still focused on executing that once we can get to that 38 as we exit this year and then move the supply chain with us considering everything Dave described about how we see the supply chain coordinating going forward.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Peter Arment: Appreciate the color. Thanks guys.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Operator: The next question is from the line of Myles Walton from Wolfe Research. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Myles Walton: Hi guys, good morning. Brian or Dave, looking at the $10 billion target for 2025, 2026, is there a way that we can have confidence yet that even if BDS is nearly neutral that the rest of the organization can still get to that number? And then also, if you can just highlight the space satellite constellation charge. I ’ m always a little bit curious when I first hear about it if I ’ m going to hear about it again, so maybe just lay out the trajectory of that program. Thanks.", "ground_truth_output": { "entities": [ { "id": 223, "label": "Value", "start_offset": 68, "end_offset": 86, "text": "$10 billion target", "global_span": [ 35077, 35095 ] } ], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Brian West: Sure. So I ’ll take the last one first. This is a particular contract with the customer that really is n’t in the category of development. The way we talk about the fixed price development contracts is very different. We are completing the requirements for the customer. We have additional work to do to make this constellation very robust with new technology. It ’s very innovative, and we have to work our way through, and we will in short order. This is not going to be one that ’s going to be dragged out for a long period of time. And in terms of the 10 billion, we always built that with some understanding that not every piece was going to go exactly correct. There were going to be some puts and takes and we provide ourselves the room with which we could have certain things not go quite perfectly. And in the case of BDS, even though it might be a bit different than we had thought even a year ago, it ’s still within the quantum of us being able to deliver that 10 billion. And we have a lot of confidence that they will be contributing to that 10 billion. Maybe not quite as much, but they ’re going to be positive. And of course, BGS remains strong. BCA, we always get more and more confident. So we still have a path to that 10 billion and just reinforce how confident we are in get – being able to get the whole enterprise there.", "ground_truth_output": { "entities": [ { "id": 224, "label": "Value", "start_offset": 569, "end_offset": 579, "text": "10 billion", "global_span": [ 36071, 36081 ] } ], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 27, "sub_chunk_id": 0, "sentences": "Myles Walton: Okay. Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 28, "sub_chunk_id": 0, "sentences": "Operator: Thank you. And the next question is from the line of Sheila Kahyaoglu from Jefferies. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 29, "sub_chunk_id": 0, "sentences": "Sheila Kahyaoglu: Good morning, Dave, Brian, and Matt. Thanks so much. And I just wanted to dig into commercial airplanes and just the operating loss there of $678 million. Brian, I know you ’ ve been out there in the trenches working with suppliers. You called out another loss in Q4. So maybe as you think about the production rates normalizing, can you maybe parse out how much of the losses are linked to concessions, pricing, supply chain constraints, and how you expect that to turn?", "ground_truth_output": { "entities": [ { "id": 225, "label": "Traditional", "start_offset": 102, "end_offset": 122, "text": "commercial airplanes", "global_span": [ 37105, 37125 ] }, { "id": 226, "label": "Traditional", "start_offset": 136, "end_offset": 150, "text": "operating loss", "global_span": [ 37139, 37153 ] }, { "id": 227, "label": "Value", "start_offset": 160, "end_offset": 172, "text": "$678 million", "global_span": [ 37163, 37175 ] } ], "relations": [ { "id": 86, "entity_ids": [ 225, 226, 227 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 30, "sub_chunk_id": 0, "sentences": "Brian West: Yes. Thanks, Sheila. So it ’s largely – the fact that we were negative again in the quarter is all the spirit impact that we ’ ve described. And fourth quarter is going to be sequentially better, but it ’s still going to be negative. And that ’s again, as we work our way through this factory disruption and we still have this abnormal running through the BCA P&L. I will tell you that in 2024, we expect margins to be positive and that ’s going to be underwritten by two things primarily BCA. It ’s going to be driven by higher volume for sure. And remember all this abnormal will be essentially done which has been a drag on the BCA margins for quite some time. So we just got to work our way out of that, which we will by the end of this year, and then work towards executing on the delivery targets for next year. And that will get back at a positive territory. And then the good news is by 2025, 2026, we still have a view where they will be double - digit margins as they have been historically. And that will be underwritten by this. These dual factories that Dave ’s talked about will be behind us. And all that labor that today is working on inventory airplanes for both the 37 and the 87 is going to go be applied to these ramps in the rates up to 50 and 10 respectively in the 37 and the 87. So all of that still is right in front of us and it all still give us confidence that we ’re going to be able to hit those kind of targets. And the BCA team is very focused on delivering that.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 31, "sub_chunk_id": 0, "sentences": "Sheila Kahyaoglu: Okay, great. Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 32, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Our next question is from Cai von Rumohr from TD Cowen. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 33, "sub_chunk_id": 0, "sentences": "Cai von Rumohr: Yes, thanks a lot. So Brian, 777X R&D spiked up. It looks like total R&D at BCA was up about $150 million sequentially. Where do those – where does the 777X sort of R&D number go moving forward? When does it peak? When does it come down? And also maybe you could update us on the certification status given we ’re in a CR, [ph ] are we going to make it on MAX 7 by year end? What about MAX 10? What about achieving TIA on the 777X?", "ground_truth_output": { "entities": [ { "id": 228, "label": "Traditional", "start_offset": 46, "end_offset": 54, "text": "777X R&D", "global_span": [ 39186, 39194 ] }, { "id": 229, "label": "Traditional", "start_offset": 80, "end_offset": 89, "text": "total R&D", "global_span": [ 39220, 39229 ] }, { "id": 230, "label": "Traditional", "start_offset": 93, "end_offset": 96, "text": "BCA", "global_span": [ 39233, 39236 ] }, { "id": 231, "label": "Value", "start_offset": 110, "end_offset": 135, "text": "$150 million sequentially", "global_span": [ 39250, 39275 ] } ], "relations": [ { "id": 87, "entity_ids": [ 228, 229, 230, 231 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 34, "sub_chunk_id": 0, "sentences": "Brian West: Yes. So let ’s start with the R&D question. So overall R&D, we continue to spend on the dash seven and the dash 10 and the uptick is as I pointed out and as you mentioned on the 777X and the 777 - 8 Freighter. Now as we move forward, that range of three – call it three, four - ish billion of R&D, that ’s going to modestly go up over the next couple years. But it ’s not going to do anything to disrupt our free cash flow target. And if it goes up a little bit, I think that ’ll be good news because we ’re investing in programs. So we ’re not necessarily worried about that at all. And it ’s all within our expectations, both near term and longer term. And in terms of the certification milestones that we have in front of us, as Dave mentioned, there ’s been no change to either the dash seven, the dash 10 or the 777X we move forward and particularly the 777X team ’s hard at work at trying to meet that commitment. So there ’s really nothing to say other than there ’s a lot of people hard at work, which is why we continue to invest in those spots.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 35, "sub_chunk_id": 0, "sentences": "Dave Calhoun: I always have to add because I do n’t want to get in a trap like we did a long time ago. The FAA makes that call and we ’re going to give them all the flexibility they need. We try to interpret it the best we can, and that ’s what we ’ ve done. Know that there have n’t been any real changes to the airplanes. So we are mostly working design assurance documentation as required by the new legislation back at the end of 2020.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 36, "sub_chunk_id": 0, "sentences": "Cai von Rumohr: And on the issue of 777X, TIA, when do you expect that?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 37, "sub_chunk_id": 0, "sentences": "Brian West: I do n’t think that we ’ ve necessarily put a date out on that for obvious reasons. So we ’ll let the teams do the work and we ’ll let the regulators dictate those specifics and we ’re just going to follow their lead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 38, "sub_chunk_id": 0, "sentences": "Cai von Rumohr: Thank you very much.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 39, "sub_chunk_id": 0, "sentences": "Operator: Thank you. And the next question is from Seth Seifman from JPMorgan. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 40, "sub_chunk_id": 0, "sentences": "Seth Seifman: Hey. Thanks very much. Good morning everyone. Brian, with your comment that the 2023 cash flow is going to come in at the low end of the range, your expectation for growth in 2024. I guess, should we be expecting 2024 to be in the 2023 range when we 're trying to get a draw beat on where 2024 is? And then within that, the 737s, sometimes I think it 's hard to bridge between production and deliveries. If it 's 38 a month exiting the year, can we say at least 38 times 12 next year plus some chunk of the inventory that 's remaining?", "ground_truth_output": { "entities": [ { "id": 232, "label": "Non_Traditional", "start_offset": 339, "end_offset": 343, "text": "737s", "global_span": [ 41872, 41876 ] }, { "id": 233, "label": "Non_Traditional", "start_offset": 392, "end_offset": 402, "text": "production", "global_span": [ 41925, 41935 ] }, { "id": 234, "label": "Non_Traditional", "start_offset": 407, "end_offset": 417, "text": "deliveries", "global_span": [ 41940, 41950 ] }, { "id": 235, "label": "Value", "start_offset": 428, "end_offset": 438, "text": "38 a month", "global_span": [ 41961, 41971 ] }, { "id": 236, "label": "Value", "start_offset": 477, "end_offset": 498, "text": "38 times 12 next year", "global_span": [ 42010, 42031 ] } ], "relations": [ { "id": 88, "entity_ids": [ 232, 233, 234, 235 ], "description": "Value_of" }, { "id": 89, "entity_ids": [ 232, 233, 234, 236 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 41, "sub_chunk_id": 0, "sentences": "Brian West: Yes. So Seth, we 're just going to wait until January to be able to describe any kind of range for cash flow next year. We just got to get through our planning cycle. We had to close the year. So just be patient with us. But we will be specific in January, the same way we were this year. And I 'll also probably let you know that, that would apply to your question on deliveries or how to think about them. Delivery is going to be higher next year. We 're going to have momentum going on this year. All of those details, we 're going to flesh out and share at the beginning of the year and at the right time, and we look forward to doing that.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 42, "sub_chunk_id": 0, "sentences": "Seth Seifman: Okay. Thanks very much.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 43, "sub_chunk_id": 0, "sentences": "Operator: The next question is from Noah Poponak from Goldman Sachs. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 44, "sub_chunk_id": 0, "sentences": "Noah Poponak: Hey. Good morning everyone.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 45, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Hi Noah.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 46, "sub_chunk_id": 0, "sentences": "Brian West: Hi Noah", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 47, "sub_chunk_id": 0, "sentences": "Noah Poponak: Brian, just staying on the 737 pace for me, recognizing you 're not going to give a number for next year, it sounds like. But if October is similar to September, it implies November, December are decent delivery numbers. So is it the case that the aft fuselage issue and the incremental inspection of hand - drilled in addition to laser - drilled fasteners, that, that is kind of behind you as you get to January 1st? It 's not impacting 2024, 737 deliveries. And then when you 're talking about being at 38 a month out in the off - the - line final assembly versus where the system is, is a different number, is there a wide gap in that to start the year? Or can we think out a real clean stable 38 a month to start the year?", "ground_truth_output": { "entities": [ { "id": 237, "label": "Value", "start_offset": 714, "end_offset": 716, "text": "38", "global_span": [ 43667, 43669 ] }, { "id": 238, "label": "Non_Traditional", "start_offset": 717, "end_offset": 724, "text": "a month", "global_span": [ 43670, 43677 ] }, { "id": 288, "label": "non_traditional", "text": "737 deliveries", "start_offset": 461, "end_offset": 475, "global_span": [ 43414, 43428 ] } ], "relations": [ { "id": 90, "entity_ids": [ 237, 238, 288 ], "description": "Value_of" } ] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 48, "sub_chunk_id": 0, "sentences": "Brian West: Answer your first question, the answer is yes, for sure. And in terms of how we think about the rate, we, the system, as Dave mentioned has always maintained to be hot because we want to make sure that they know that the demand signal is there. And we want them to continue focus on that master schedule. How exactly as we start the year we 'll be able to count deliveries relative to that 38, we 'll see. But right now, job one is to exit – get the non - conformance behind us. Remember, we had about a 30 aircraft growth between the second quarter and the third quarter into the inventory airplane. So that 's going to be working its way out of the system relatively quickly, which gives us confidence in the November, December time frame. And then as we think about prime of the pump for 38 per month, we 're going to move towards January and beyond and hopefully some pretty good execution. So we 'll have to wait and see exactly how that plays out, but the underlying system is going to stay at 38. And as we get through next year, obviously, there 'll be certain rate ramps that we 'll describe later. But right now, if we have everything be coordinated across the broad supply chain, I think we 'll be fine.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 49, "sub_chunk_id": 0, "sentences": "Noah Poponak: Okay. And I guess putting a lot of this together and everybody trying to figure out where the 2024 free cash is going to land. Is it kind of reasonable to think of 2024 as just two halves and that some of your hesitation in giving some of those numbers is you just do n't know exactly where the year starts. Is there still some 737 disruption? 787 at five is a different margin than 787 at 10? Maybe BDS margins are still negative in the first half, but they 're positive in the second half. And so this next year 's first half free cash flow just still have some of 2023 elements lingering in it, but that the second half will be kind of run rating into more of what your stable looks like and maybe second half 2024 looks, the numbers look more like second half of 2022 type of free cash flow numbers. And we can comfortably think of that as run rating into your future?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 50, "sub_chunk_id": 0, "sentences": "Brian West: Yes. No, all of that is going to have to be something we talk about in January. Right now, we have to get the non - conformance behind us. We have to be able to hit this delivery range that we ' ve just described. And we have a lot to do, but confidence we 'll get there. And then we 'll describe the shape of next year at the right time. I just do n't want to get too far ahead of ourselves. And I do believe that as – I do believe next year will be better, and I do believe we 'll exit next year better. How that folds up between halves, you 're just going to have to give us a little bit more time as we work our way through our planning cycle and we get to January.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 51, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Noah, if I could just maybe add one thing to make sure everybody knows what, at least what I ' m all focused on. We 're going to exit this year with a little more than 100 of the return - to - service airplanes that we had at the end of 2020. That is what our shadow factories are focused on in a big way to make sure that we can bleed that down to basically nothing by the end of next year. So the pace at which we bleed that down, we complete that rework, deliver all those airplanes dictates a lot about that cash flow. It gets better every month. But it 's going to be all about the pace at which we can do it and transfer that workforce into the production rate increases. So we need – there 's a lot to know about that. We 're going to give you our best shot at what that guidance looks like. But by way of proxy, that is a very important achievement for us. And I ' m 100% focused on it, and I know Brian is and the team at BCA.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 52, "sub_chunk_id": 0, "sentences": "Noah Poponak: Okay, thanks so much.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 53, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Yep.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 54, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Our next question is from David Strauss from Barclays. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 55, "sub_chunk_id": 0, "sentences": "David Strauss: Thanks. Good morning everyone.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 56, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Good morning.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 57, "sub_chunk_id": 0, "sentences": "David Strauss: Wanted to ask about the supply chain. Are there any other spots – hot spots in the supply chain where you ' ve either had to infuse a meaningful amount of cash like you did with Spirit or are in negotiations to do something similar to what you ' ve done with Spirit? That 's the first question. And then the second question, I guess a clarifying comment for Brian. On the BCA margin progression next year turning positive, is that both on a program on a unit basis or would that just be on a program basis? Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 58, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Brian, how about I answer the first part of this one? I consider the Spirit remedy fairly unique, in fact, totally unique. I do n't think that 's going to have any ramifications anywhere else, and there are n't any signals that way. But the linkage really is important. As Spirit becomes stable and we get to our rates, rates solve most of the supply chain 's problems. We got to get to those rates so that they can make the kind of money that they associate with those rates and we get to where we need. So there is a linkage, but it 's not a copycat linkage, and there 's no sign of that happening.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 59, "sub_chunk_id": 0, "sentences": "Brian West: And in terms of the margins on both unit and program, they 'll be positive. And program, we 'll have growth. So we look forward to describing that as we get closer to January but both.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 60, "sub_chunk_id": 0, "sentences": "David Strauss: Great. Thanks very much.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 61, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Yep.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 62, "sub_chunk_id": 0, "sentences": "Operator: Thank you. And our next question is from Rich Safran from Seaport Research Partners. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 63, "sub_chunk_id": 0, "sentences": "Rich Safran: Thanks, Brian, Matt. Good morning. I got a two part tanker - related question for you. First, with Lockheed dropping out, when do you expect an award? And what could that do to your overall assessment of program profitability? I ' m basically assuming here that you would have to review the accounting on the program. Second part is with deliveries restarting, what 's being anticipated? I mean, how much of a catch - up should we expect in 4Q? And is that being factored in your guide?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 64, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Well, let me just comment on the tanker. I ' m not surprised at what we all read with respect to Airbus now going on their own. They will go. So we should n't expect them to sort of vacate. I do like what it ultimately does for us and the competition. We are not afraid of competition. And yes, that next contract matters a lot. We have to ultimately underwrite the cost and get this right. And as we ' ve committed to you all along, we 're going to stay disciplined on that front. And no, there 's not – this is n't program accounting, it 's contract accounting. So I do n't think we 're going to have any implication associated with lots and an additional contract. Now I 'm not the accountant. So I 'll ask Brian to collaborate.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 65, "sub_chunk_id": 0, "sentences": "Brian West: Yes. No, exactly. We do n't see that changing. We 'll just add to volume like we do with any kind of extension. And in terms of your question in the fourth quarter, of course, any kind of deliveries and cash flow are going to be factored into our look for the quarter and going forward. So that 's all baked in.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 66, "sub_chunk_id": 0, "sentences": "Rich Safran: Thanks a lot.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 67, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Yes.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 68, "sub_chunk_id": 0, "sentences": "Matt Welch: And that concludes our call this morning. I appreciate everybody joining. Thank you again.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 69, "sub_chunk_id": 0, "sentences": "Dave Calhoun: Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 70, "sub_chunk_id": 0, "sentences": "Brian West: Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "BA", "quarter": 3, "year": 2023, "date": "2023-10-25 13:03:07", "chunk_id": 71, "sub_chunk_id": 0, "sentences": "Operator: Thank you and that completes The Boeing Company 's Third Quarter 2023 Earnings Conference Call. Thank you all for joining and you may now disconnect.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Operator: Good morning. My name is Justin, and I will be your conference facilitator today. Welcome to Chevron ’s Second Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen - only mode. After the speakers ’ remarks, there will be a question - and - answer session and instructions will be given at that time. [Operator Instructions ] As a reminder, this conference call is being recorded. I will now turn the conference call over to the General Manager of Investor Relations of Chevron Corporation, Mr. Jake Spiering. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Jake Spiering: Thank you, Justin. Welcome to Chevron ’s second quarter 2024 earnings conference call and webcast. I ’m Jake Spiering, Head of Investor Relations. Our Chairman and CEO, Mike Wirth; and CFO, Eimear Bonner are on the call with me today. We will refer to the slides and prepared remarks that are available on Chevron ’s website. Before we begin, please be reminded that this presentation contains estimates, projections and other forward - looking statements. A reconciliation of non - GAAP measures can be found in the appendix to this presentation. Please review the cautionary statement on Slide 2. Now, I will turn it over to Mike.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Thanks, Jake. This quarter, Chevron delivered strong production and extended our track record of consistent shareholder returns. Production increased by more than 11% from the prior year and included a new quarterly record in the Permian. Over the past two years we ’ ve returned over $50 billion to shareholders, approximately 18% of our market cap. We continued to advance growth opportunities in our traditional and new energies businesses through adding new exploration plays in West Africa and South America, achieving key milestones on the ACES green hydrogen project and commissioning of the Geismar renewable diesel plant expansion, which is expected to come online by the end of the year. The merger with Hess achieved a successful shareholder vote, and we now expect the FTC review process to conclude in the third quarter. The arbitration panel addressing the Stabroek JOA has set a hearing for next year. Hess had requested an earlier hearing, but the panel ultimately sets the schedule. We remain confident this is a straightforward matter and the outcome will affirm a preemption right does not apply. We ’re committed to the merger and look forward to combining the two companies. In the Gulf of Mexico, we ’re leveraging our deepwater expertise with plans to deliver high cash - margin, low carbon intensity production growth. First oil at Anchor is imminent, delivering the industry ’s first deepwater 20,000 pound development. The project is on - track to come in under budget while deploying multiple breakthrough technologies. After Anchor, three more projects are scheduled to come online and we expect production to grow to 300,000 barrels a day by 2026. Our developments have become more capital - efficient, unit drilling costs have come down and facility designs are optimized for high returns. As one of the largest leaseholders in the basin, we ’re well - positioned for the future with leading technology capability and attractive exploration opportunities near existing infrastructure and in frontier areas. In the Permian, base business performance continues to improve, with higher reliability and lower decline rates. Development activity continues to get more efficient. We ’re one of the first operators to deploy triple - frac, delivering cost reductions of more than 10% and shortening completion times by 25% where applied. In the Delaware Basin, company - operated well performance continues to improve as we optimize development strategies. In the Midland Basin, early well results are lower versus last year, our program in the second half of the year is more heavily weighted to development targets that we expect to perform better. With strong momentum in our operated portfolio and predictable results from our non - operated and royalty acreage, we now expect full - year production growth of about 15% and fourth quarter production to average around 940,000 barrels per day. At TCO, cost and schedule guidance is unchanged, with FGP expected to start up in the first half of 2025. We continue to bring major equipment online and complete key project milestones. Eight out of 21 metering stations have been converted to low pressure. Three Pressure Boost Facility compressors are in operation. A third gas turbine generator is in service. The first 3GP process system is ready for operation, and we completed the SGI turnaround on time and under budget. The wells converted to low pressure are meeting expectations and the Pressure Boost Facilities are operating with high reliability. Over the next two quarters, we ’ll continue converting the field to low pressure while further commissioning key equipment for FGP. The project team remains focused on completing the project safely and starting up reliably to deliver value to Kazakhstan, TCO and shareholders. This quarter was a little light due to some operational and other discrete items that impacted results, but I remain confident we ’re well - positioned to deliver on long - term earnings and cash flow growth. Now, I ’ll turn it over to Eimear to cover the details.", "ground_truth_output": { "entities": [ { "id": 0, "label": "Traditional", "start_offset": 148, "end_offset": 168, "text": "Production increased", "global_span": [ 1364, 1384 ] }, { "id": 1, "label": "Value", "start_offset": 182, "end_offset": 185, "text": "11%", "global_span": [ 1398, 1401 ] }, { "id": 2, "label": "Traditional", "start_offset": 221, "end_offset": 241, "text": "new quarterly record", "global_span": [ 1437, 1457 ] }, { "id": 3, "label": "Traditional", "start_offset": 290, "end_offset": 298, "text": "returned", "global_span": [ 1506, 1514 ] }, { "id": 4, "label": "Value", "start_offset": 304, "end_offset": 315, "text": "$50 billion", "global_span": [ 1520, 1531 ] }, { "id": 5, "label": "Traditional", "start_offset": 319, "end_offset": 331, "text": "shareholders", "global_span": [ 1535, 1547 ] }, { "id": 6, "label": "Value", "start_offset": 347, "end_offset": 353, "text": "18% of", "global_span": [ 1563, 1569 ] }, { "id": 7, "label": "Value", "start_offset": 358, "end_offset": 368, "text": "market cap", "global_span": [ 1574, 1584 ] }, { "id": 8, "label": "Non_Traditional", "start_offset": 669, "end_offset": 677, "text": "expected", "global_span": [ 1885, 1893 ] }, { "id": 9, "label": "Non_Traditional", "start_offset": 681, "end_offset": 692, "text": "come online", "global_span": [ 1897, 1908 ] }, { "id": 10, "label": "Non_Traditional", "start_offset": 700, "end_offset": 715, "text": "end of the year", "global_span": [ 1916, 1931 ] }, { "id": 11, "label": "Non_Traditional", "start_offset": 1422, "end_offset": 1462, "text": "first deepwater 20,000 pound development", "global_span": [ 2638, 2678 ] }, { "id": 12, "label": "Non_Traditional", "start_offset": 1468, "end_offset": 1475, "text": "project", "global_span": [ 2684, 2691 ] }, { "id": 13, "label": "Non_Traditional", "start_offset": 1479, "end_offset": 1481, "text": "on", "global_span": [ 2695, 2697 ] }, { "id": 14, "label": "Non_Traditional", "start_offset": 1484, "end_offset": 1489, "text": "track", "global_span": [ 2700, 2705 ] }, { "id": 15, "label": "Traditional", "start_offset": 1643, "end_offset": 1653, "text": "production", "global_span": [ 2859, 2869 ] }, { "id": 16, "label": "Traditional", "start_offset": 1657, "end_offset": 1661, "text": "grow", "global_span": [ 2873, 2877 ] }, { "id": 17, "label": "Value", "start_offset": 1665, "end_offset": 1686, "text": "300,000 barrels a day", "global_span": [ 2881, 2902 ] }, { "id": 18, "label": "Traditional", "start_offset": 2293, "end_offset": 2308, "text": "cost reductions", "global_span": [ 3509, 3524 ] }, { "id": 19, "label": "Value", "start_offset": 2322, "end_offset": 2325, "text": "10%", "global_span": [ 3538, 3541 ] }, { "id": 20, "label": "Non_Traditional", "start_offset": 2330, "end_offset": 2351, "text": "shortening completion", "global_span": [ 3546, 3567 ] }, { "id": 21, "label": "Value", "start_offset": 2361, "end_offset": 2364, "text": "25%", "global_span": [ 3577, 3580 ] }, { "id": 80, "label": "non_traditional", "text": " ACES green hydrogen project and commissioning of the Geismar renewable diesel plant expansion", "start_offset": 564, "end_offset": 658, "global_span": [ 1780, 1874 ] }, { "id": 81, "label": "Value", "text": "under budget", "start_offset": 1501, "end_offset": 1513, "global_span": [ 2717, 2729 ] } ], "relations": [ { "id": 1, "entity_ids": [ 0, 1 ], "description": "Value_of" }, { "id": 2, "entity_ids": [ 0, 2 ], "description": "Value_of" }, { "id": 3, "entity_ids": [ 3, 4, 5 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 3, 6, 7 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 8, 9, 10, 80 ], "description": "Value_of" }, { "id": 6, "entity_ids": [ 11, 12, 13, 14, 81 ], "description": "Value_of" }, { "id": 7, "entity_ids": [ 15, 16, 17 ], "description": "Value_of" }, { "id": 8, "entity_ids": [ 18, 19 ], "description": "Value_of" }, { "id": 9, "entity_ids": [ 20, 21 ], "description": "Value_of" } ] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Eimear P. Bonner: Thanks, Mike. We reported second quarter earnings of $4.4 billion, or $2.43 per share. Adjusted earnings were $4.7 billion, or $2.55 per share. Results in the quarter were impacted by downtime in Upstream that weighed on realizations, higher exploration expense and Downstream turnaround timing. Organic CapEx was $3.9 billion, in - line with budget. Our balance sheet remains one of the strongest in the industry, ending the quarter with a net debt ratio of 10.7%. Chevron generated solid cash flow of nearly $9 billion excluding working capital. Working capital lowered cash flow due to tax true - up payments outside the U.S. and a build in inventories. We expect about half of the working capital to unwind in the second half of this year, primarily in the fourth quarter. We again demonstrated our consistent approach to returning cash to shareholders with $6 billion of dividends and share repurchases. Adjusted earnings were lower by $700 million versus last quarter. Adjusted Upstream earnings were down mainly due to lower liftings, higher exploration expense and absence of favorable tax impacts from the prior quarter. Partly offsetting were higher realizations. Adjusted Downstream earnings were down due to lower margins and reduced capture rates, this was partially offset by timing effects. All Other decreased mainly due to a tax true - up. Versus last year, adjusted second quarter earnings were down $1.1 billion. Adjusted Upstream earnings were flat, higher realizations and liftings were mostly offset with higher DD&A due to the PDC acquisition and the absence of prior year favorable tax items. Adjusted Downstream earnings decreased mainly due to lower refining margins and higher turnaround and transportation OpEx. The Other segment was down primarily due to state tax adjustments. Worldwide oil equivalent production was up over 11% from last year due to the acquisition of PDC Energy and significant growth in the Permian Basin. Now, looking ahead. The third quarter will have heavier than usual maintenance with several turnarounds at Upstream assets, including TCO and Gorgon. Impacts from refinery turnarounds are mostly driven by El Segundo. There will be a one - time payment related to discontinued operations of around $600 million. We anticipate affiliate dividends to be around $1 billion this quarter. With the project in Kazakhstan nearing completion, we expect quarterly dividends from TCO moving forward. As a reminder, Chevron pays a 15% withholding tax on dividends from TCO which lowers both earnings and cash flow. Share repurchases are targeting the $17.5 billion annual guidance rate. Asset sales in the second half of the year are expected to be aligned with full - year guidance. Back to you, Mike.", "ground_truth_output": { "entities": [ { "id": 22, "label": "Traditional", "start_offset": 60, "end_offset": 68, "text": "earnings", "global_span": [ 5366, 5374 ] }, { "id": 23, "label": "Value", "start_offset": 72, "end_offset": 84, "text": "$4.4 billion", "global_span": [ 5378, 5390 ] }, { "id": 24, "label": "Value", "start_offset": 89, "end_offset": 104, "text": "$2.43 per share", "global_span": [ 5395, 5410 ] }, { "id": 25, "label": "Traditional", "start_offset": 106, "end_offset": 123, "text": "Adjusted earnings", "global_span": [ 5412, 5429 ] }, { "id": 26, "label": "Value", "start_offset": 129, "end_offset": 141, "text": "$4.7 billion", "global_span": [ 5435, 5447 ] }, { "id": 27, "label": "Value", "start_offset": 146, "end_offset": 151, "text": "$2.55", "global_span": [ 5452, 5457 ] }, { "id": 28, "label": "Traditional", "start_offset": 315, "end_offset": 328, "text": "Organic CapEx", "global_span": [ 5621, 5634 ] }, { "id": 29, "label": "Value", "start_offset": 333, "end_offset": 345, "text": "$3.9 billion", "global_span": [ 5639, 5651 ] }, { "id": 30, "label": "Traditional", "start_offset": 460, "end_offset": 474, "text": "net debt ratio", "global_span": [ 5766, 5780 ] }, { "id": 31, "label": "Value", "start_offset": 478, "end_offset": 483, "text": "10.7%", "global_span": [ 5784, 5789 ] }, { "id": 32, "label": "Traditional", "start_offset": 509, "end_offset": 518, "text": "cash flow", "global_span": [ 5815, 5824 ] }, { "id": 33, "label": "Value", "start_offset": 529, "end_offset": 539, "text": "$9 billion", "global_span": [ 5835, 5845 ] }, { "id": 34, "label": "Value", "start_offset": 881, "end_offset": 891, "text": "$6 billion", "global_span": [ 6187, 6197 ] }, { "id": 35, "label": "Traditional", "start_offset": 895, "end_offset": 904, "text": "dividends", "global_span": [ 6201, 6210 ] }, { "id": 36, "label": "Traditional", "start_offset": 909, "end_offset": 926, "text": "share repurchases", "global_span": [ 6215, 6232 ] }, { "id": 37, "label": "Traditional", "start_offset": 928, "end_offset": 945, "text": "Adjusted earnings", "global_span": [ 6234, 6251 ] }, { "id": 38, "label": "Value", "start_offset": 960, "end_offset": 972, "text": "$700 million", "global_span": [ 6266, 6278 ] }, { "id": 39, "label": "Traditional", "start_offset": 1394, "end_offset": 1426, "text": "adjusted second quarter earnings", "global_span": [ 6700, 6732 ] }, { "id": 40, "label": "Value", "start_offset": 1437, "end_offset": 1449, "text": "$1.1 billion", "global_span": [ 6743, 6755 ] }, { "id": 41, "label": "Traditional", "start_offset": 1451, "end_offset": 1477, "text": "Adjusted Upstream earnings", "global_span": [ 6757, 6783 ] }, { "id": 42, "label": "Value", "start_offset": 1483, "end_offset": 1487, "text": "flat", "global_span": [ 6789, 6793 ] }, { "id": 43, "label": "Traditional", "start_offset": 1636, "end_offset": 1664, "text": "Adjusted Downstream earnings", "global_span": [ 6942, 6970 ] }, { "id": 44, "label": "Value", "start_offset": 1665, "end_offset": 1674, "text": "decreased", "global_span": [ 6971, 6980 ] }, { "id": 45, "label": "Non_Traditional", "start_offset": 1826, "end_offset": 1861, "text": "Worldwide oil equivalent production", "global_span": [ 7132, 7167 ] }, { "id": 46, "label": "Value", "start_offset": 1874, "end_offset": 1877, "text": "11%", "global_span": [ 7180, 7183 ] }, { "id": 47, "label": "Traditional", "start_offset": 2208, "end_offset": 2211, "text": "one", "global_span": [ 7514, 7517 ] }, { "id": 48, "label": "Traditional", "start_offset": 2214, "end_offset": 2226, "text": "time payment", "global_span": [ 7520, 7532 ] }, { "id": 49, "label": "Value", "start_offset": 2272, "end_offset": 2284, "text": "$600 million", "global_span": [ 7578, 7590 ] }, { "id": 50, "label": "Value", "start_offset": 2333, "end_offset": 2343, "text": "$1 billion", "global_span": [ 7639, 7649 ] }, { "id": 51, "label": "Traditional", "start_offset": 2479, "end_offset": 2491, "text": "Chevron pays", "global_span": [ 7785, 7797 ] }, { "id": 52, "label": "Value", "start_offset": 2494, "end_offset": 2497, "text": "15%", "global_span": [ 7800, 7803 ] }, { "id": 53, "label": "Traditional", "start_offset": 2510, "end_offset": 2513, "text": "tax", "global_span": [ 7816, 7819 ] }, { "id": 54, "label": "Traditional", "start_offset": 2517, "end_offset": 2526, "text": "dividends", "global_span": [ 7823, 7832 ] }, { "id": 55, "label": "Traditional", "start_offset": 2578, "end_offset": 2595, "text": "Share repurchases", "global_span": [ 7884, 7901 ] }, { "id": 56, "label": "Value", "start_offset": 2614, "end_offset": 2627, "text": "$17.5 billion", "global_span": [ 7920, 7933 ] }, { "id": 57, "label": "Traditional", "start_offset": 2650, "end_offset": 2661, "text": "Asset sales", "global_span": [ 7956, 7967 ] }, { "id": 58, "label": "Value", "start_offset": 2712, "end_offset": 2719, "text": "aligned", "global_span": [ 8018, 8025 ] }, { "id": 82, "label": "Traditional", "text": "per share", "start_offset": 152, "end_offset": 161, "global_span": [ 5458, 5467 ] }, { "id": 83, "label": "Traditional", "text": "anticipate affiliate dividends", "start_offset": 2289, "end_offset": 2319, "global_span": [ 7595, 7625 ] }, { "id": 84, "label": "Traditional", "text": " annual guidance rate", "start_offset": 2627, "end_offset": 2648, "global_span": [ 7933, 7954 ] } ], "relations": [ { "id": 10, "entity_ids": [ 22, 23 ], "description": "Value_of" }, { "id": 11, "entity_ids": [ 22, 24 ], "description": "Value_of" }, { "id": 12, "entity_ids": [ 25, 26 ], "description": "Value_of" }, { "id": 13, "entity_ids": [ 25, 27, 82 ], "description": "Value_of" }, { "id": 14, "entity_ids": [ 28, 29 ], "description": "Value_of" }, { "id": 15, "entity_ids": [ 30, 31 ], "description": "Value_of" }, { "id": 16, "entity_ids": [ 32, 33 ], "description": "Value_of" }, { "id": 17, "entity_ids": [ 34, 35, 36 ], "description": "Value_of" }, { "id": 18, "entity_ids": [ 37, 38 ], "description": "Value_of" }, { "id": 19, "entity_ids": [ 39, 40 ], "description": "Value_of" }, { "id": 20, "entity_ids": [ 41, 42 ], "description": "Value_of" }, { "id": 21, "entity_ids": [ 43, 44 ], "description": "Value_of" }, { "id": 22, "entity_ids": [ 45, 46 ], "description": "Value_of" }, { "id": 23, "entity_ids": [ 47, 48, 49 ], "description": "Value_of" }, { "id": 24, "entity_ids": [ 50, 83 ], "description": "Value_of" }, { "id": 25, "entity_ids": [ 51, 52, 53, 54 ], "description": "Value_of" }, { "id": 26, "entity_ids": [ 55, 56, 84 ], "description": "Value_of" } ] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Okay. Thanks, Eimear. Today we announced we ’re moving Chevron ’s headquarters from San Ramon to Houston to enable better collaboration and engagement, both internally and externally. We also announced the retirements of Nigel Hearne, Executive Vice President, Oil, Products & Gas; Colin Parfitt, Vice President, Midstream; and Rhonda Morris, Vice President and Chief Human Resources Officer after long and distinguished careers. I want to extend my sincere thanks to Nigel, Colin and Rhonda, for their service and their many contributions to our company. And finally, I ’d like to offer our deepest condolences to the family of our former Chairman and CEO, Ken Derr, who passed away three weeks ago. Ken ’s vision and leadership helped guide Chevron through momentous times to create a high - performing company with outstanding people and a portfolio that distinguishes our business to this day. Ken left an indelible legacy for our company and all those whose lives have been made better by his leadership. He will never be forgotten. Back to you, Jake.", "ground_truth_output": { "entities": [ { "id": 85, "label": "free cash flow", "text": "Today we announced we ’r", "start_offset": 41, "end_offset": 65, "global_span": [ 8112, 8136 ] } ], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Jake Spiering: That concludes our prepared remarks. We ’re now ready to take your questions. Please ask you to limit yourself to one question. We will do our best to get all of your questions answered. Justin, please open the line.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "Operator: Thank you. [Operator Instructions ] And our first question comes from Neil Mehta with Goldman Sachs.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Neil Mehta: Yes. Thank you so much and congratulations to Nigel, Colin and Rhonda on their retirement. My question, Mike, was really focused around TCO. And, it sounds like we are making progress on that project, but this is a critical period of time during the summer productivity period. So, just would love your thoughts on how FGP is progressing. And then, as it relates to Kazakhstan, we ’re getting a lot of questions about the concession extension as we think about next decade and I recognize that ’s a long way away, but maybe you can help to address some of the investor debate around that topic as well?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Sure. Thanks, Neil, and thanks for your kind remarks about our retiring executives. So, at TCO as I covered in my comments, we ’re really seeing steady and consistent progress. Work is being planned and liquidated in sequence, which is resulting in strong daily, weekly and monthly progress. I get a weekly report straight from the project team with a tremendous amount of detail. I ’ m in regular contact with them, and I can tell you that they are really on top of their game. As I said, we ’ ve got three of the pressure boost facilities up and running, the fourth not far away and WPMP is operating very reliably. So, we ’re pleased with the performance of the equipment. We ’re very pleased with the performance of the wells flowing at low pressure and its early days, but it augurs very well for the maintenance of strong production out of the field for a long time to come. On FGP, we ’re going to have additional FGP major equipment and systems ready for operations or started up later this quarter. And, we ’re just going to continue to work our way through that. We ’re moving in a more complex process units as opposed to some of the big rotating equipment and field metering station conversions. So, the nature of some of the startup work on FGP will be a little bit different. The other thing to recall is, we do have a large turnaround this quarter. So, good progress. The one thing that we wo n’t compromise is safety or reliability in pursuit of schedule, but I can tell you that the team is all over that. With respect to the concession, we ’re really focused right now on getting this project up and running. The concession exploration is nearly a decade away, and the most important thing we can do is make sure that this big complex project is started up safely and reliably. To remind people that may not know, this is one of the world ’s deepest producing supergiant oil fields and it ’s the largest single trap producing reservoir in existence. So, TCO is very important to the Republic of Kazakhstan, it ’s very important to us and we ’ll certainly be in discussions with the government over time about potential extension. The key thing is an extension needs to create value for the country and it needs to create value for Chevron shareholders. We always seek that kind of an outcome. We ’ ve extended concessions in other places where value was created for both parties. And then, there ’s been some instances over the recent period of time where we could n’t achieve the outcome and we did not extend. So, we ’ll be talking more about this subject over time, but right now we ’re really focused on project execution and continuing the strong performance on delivering FGP. Thanks, Neil.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Operator: And, next is Alastair Syme with Citi.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Alastair Syme: Thanks. Mike, this period of limbo around Hess is obviously a period you do n’t want to be in. It ’s not clear to me when the FTC rules or if they push out, until arbitration as I sort of previously indicated. But my question to you is, do you feel limited to do any other significant portfolio development in this interim period? I guess if the right opportunity came along that is?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. You could do something else if you wanted to. This is the transaction, that ’s the right transaction for us. And so, we ’re very focused on it, Alastair, and we ’ ve made good progress with the shareholder vote, we ’re steadily marching along with the FTC, and I ’ ve already mentioned the timeline on the arbitration. So, it ’s sometimes good things you have to work for and this will take a little bit more time than we had anticipated, but we remain confident in the outcome. And, as I tried to cover in our prepared remarks, we ’ ve got a really strong queue of organic growth opportunities in flight right now. We did n’t mention the Eastern Med, which is another one. So, we ’ ve got projects in multiple regions of the world that are poised to deliver growth over the next three years, absent it we be at 10% growth in free cash flow, we ’ ve got projects coming on in numerous basins in the world and in our chemicals business as well. So, we ’re really focused on that and creating value there. But, if another opportunity were to present itself that were compelling, we ’re certainly in a position to consider it. Thanks for the question.", "ground_truth_output": { "entities": [ { "id": 59, "label": "Traditional", "start_offset": 801, "end_offset": 817, "text": "next three years", "global_span": [ 14089, 14105 ] }, { "id": 60, "label": "Value", "start_offset": 838, "end_offset": 841, "text": "10%", "global_span": [ 14126, 14129 ] }, { "id": 61, "label": "Traditional", "start_offset": 842, "end_offset": 848, "text": "growth", "global_span": [ 14130, 14136 ] }, { "id": 62, "label": "Traditional", "start_offset": 852, "end_offset": 866, "text": "free cash flow", "global_span": [ 14140, 14154 ] } ], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Operator: And, the next question will come from Paul Cheng with Scotiabank.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Paul Cheng: Thank you. Mike, can you talk about the potential for further cost efficiency gain? Where that you see over the next, say, two or three years the biggest opportunity? And, could you quantify that? I mean, how big is that opportunity set for you guys? Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. Thanks, Paul. I appreciate it. You and I have known each other for a long time. So, you know that capital discipline and cost discipline are near and dear to my heart and they always matter in a commodity business. Year - to - date and Q2 unit OpEx for us was about $16 a barrel, which is down about 5% from 2022. And, improving unit OpEx continues to be a focus. Some of the actions we ’re taking today driving down energy usage, which is a way to both reduce cost and emissions. At the same time in the Upstream, we ’re electrifying rigs in the Permian, we ’re lowering steam use at our San Joaquin Valley operations, in the Downstream we ’re implementing energy efficiency projects at our refineries that reduce gas consumption and power use. We ’re also optimizing supplier contracts, implementing a minimum functional objective approach to operations and maintenance activities at key assets like TCO and our LNG plants in Australia. And, we ’re confident that we ’ll continue to find new ways to increase efficiencies and reduce unit cost. Our plans would call for further unit cost reductions. And, I think you can look for us to use technology. For instance, the breakthroughs we ’re seeing in data technology offer significant opportunities for both efficiency, asset productivity, improved safety and other performance. And so, you can rest assured that I am focused on costs, we are focused on costs and you ’ll continue to hear more about that from us over time.", "ground_truth_output": { "entities": [ { "id": 63, "label": "Traditional", "start_offset": 239, "end_offset": 255, "text": "Year - to - date", "global_span": [ 15051, 15067 ] }, { "id": 64, "label": "Traditional", "start_offset": 263, "end_offset": 272, "text": "unit OpEx", "global_span": [ 15075, 15084 ] }, { "id": 65, "label": "Value", "start_offset": 290, "end_offset": 302, "text": "$16 a barrel", "global_span": [ 15102, 15114 ] }, { "id": 66, "label": "Value", "start_offset": 324, "end_offset": 326, "text": "5%", "global_span": [ 15136, 15138 ] } ], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "Jake Spiering: Thanks, Paul.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Thanks, Paul.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "Operator: And, the next question will come from Biraj Borkhataria with RBC.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Biraj Borkhataria: Hi, thanks for taking my question. I wanted to just go back to Kazakhstan and the FGP ramp up. So, I was n’t asking an operational question, but I appreciate FGP is on - track. But, it was related to the OPEC promises or curtailments. Kazakhstan this year has been a bit ahead of its quota, stated quota. If you take the headline figures from OPEC into next year, it does n’t look like there ’s a huge amount of room in that quota to grow. And obviously, FGP is a fairly substantial project. So, just wanted to get your thoughts on any sort of issues or risks related to that? Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. Thanks, Biraj. So, obviously we are not party to those discussions. We comply with the requirements in any country where we operate including if they have some sort of production targets or requirements that they impose upon producers in the country. We have not received any indication from the Republic of Kazakhstan with regards to any curtailments relative to OPEC+. What oftentimes happens there is with the production in several big assets, you have turnarounds, projects and other things that create some degree of variability across multiple different producers and I think the Republic looks to manage that and fit their plan together. So, I do n’t have any unique knowledge about 2025, but we have a very close relationship. I will tell you that the TCO barrels, I think from a contribution to the Republic standpoint are very attractive and our intent is to produce at the full capacity any point in time for our facility in order to maximize revenue for the Republic and for Chevron. So, if there ’s further developments on that front, we ’ll certainly provide them, but we do n’t have anything from the government right now. Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "Operator: And, we ’ll take a question from Doug Leggate with Wolfe Research.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Doug Leggate: Thank you. Good morning, everyone. Hey, Mike. I ’ m delighted to see you guys come to Houston. Welcome. But, if you want to stop by for coffee, let me know. But, Mike, I missed out on the last earnings call, and I apologize for bringing it up. I know it ’s highly sensitive and highly, I guess, subjective, but the issue around the delayed arbitration, I wanted to pose a question to you and see if we can get you to probe a little bit on this. ExxonMobil, regardless of their motivation, has stated that they have no interest in buying Hess. But, at the same time, our understanding is the bigger concern is global contractual rule for credibility, protecting that aspect of a contract. So, when I go into two months of the legalities, I wonder, is there a compromise that could cut short the arbitration timeline so you do n’t have to go to arbitration? For example, acknowledge you have a ROFR, but Exxon acknowledges they ’re not going to exercise a ROFR so everybody gets to protect your contracts for Exxon and secure your acquisition for Chevron. Is it a compromise that could cut the arbitration short is my question?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. Hey, it ’s great to hear a familiar voice back on the call, Doug, and I look forward to seeing you in Houston. What you have outlined is very sensible. It could be the foundation for something, but I really ca n’t comment on specific conversations. I think we have indicated previously that there was a period of time where Hess and Chevron worked with the other partners in the Stabroek block to try to find a resolution here that accommodated everybody ’s interests and that time has now passed and we ’re in the arbitration process. So, that ’s the path that we ’re on. We sought something along the lines of an outcome as you described earlier, but it does n’t appear that, that is how this is going to end up. Everything is confidential obviously the language in the contract and contracts around the world have specific language and in each instance. I think the parties understand how that contract is written and how it would apply. So, I really ca n’t say anything more about it than that.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Jake Spiering: Thanks, Doug.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Operator: And, the next question comes from Josh Silverstein with UBS.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Josh Silverstein: Hey, thanks, good morning, guys. Nice update in the Permian. I was wondering if you could provide a little bit more details around increase in the fourth quarter outlook. Was this due to the new Delaware completion technique from Chevron? Any thoughts on non - op royalty volumes? And then, just looking at the Midland side, was there anything kind of specific as far as the zone or completion that you guys are now shifting away from to get increased productivity there? Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. So look, the Permian is performing strongly as you can see in the numbers. And, just to remind everybody about 80% of our program is in the Delaware. Delaware performance is up year - on - year and first half ‘ 24 production overall in the basin now averaged over 870,000 barrels a day, which is essentially flat or even a touch up from fourth quarter of last year. The drivers of that are improved performance across multiple dimensions of the business and in the base business we ’re seeing lower decline from proactive maintenance efforts, lower operated downtime, artificial lift optimization. I mentioned triple - frac earlier, which is reducing costs and increasing cycle time. So, the spud - to - pop cycle has shortened further. So, we ’re getting more pop days online than we might have a year ago and well performance as I said in the Delaware has been very strong. In the Midland, some of the first half pops have been a little bit below expectation. There ’s only a finite number of pads I could count them on one hand that are involved in this. And we ’re always moving into new zones, new acreage. And as part of that, we ’ ve got an active learning and continuous improvement efforts to be sure we ’re optimizing development across the basin because it is not completely homogeneous. So, as we ’re testing new zones to better inform our future development plans, we learn. In this particular case, the learnings will be applied as we go forward. That said, it performed very well in the past. I think the thing you can pull up from that and look this is a big long - term asset that ’s got a lot of life ahead of us and we should be continually improving in it, so that over time we can deliver even stronger returns, stronger performance and we should be learning as we develop it as the basin matures and it ’s exceeding expectations for this year. We ’ ve raised our full year guidance and we ’ ve got great confidence in what we ’ll deliver in 2025. Thanks, Josh.", "ground_truth_output": { "entities": [ { "id": 67, "label": "Traditional", "start_offset": 174, "end_offset": 194, "text": "Delaware performance", "global_span": [ 21240, 21260 ] }, { "id": 68, "label": "Traditional", "start_offset": 238, "end_offset": 248, "text": "production", "global_span": [ 21304, 21314 ] }, { "id": 69, "label": "Traditional", "start_offset": 274, "end_offset": 282, "text": "averaged", "global_span": [ 21340, 21348 ] }, { "id": 70, "label": "Value", "start_offset": 288, "end_offset": 309, "text": "870,000 barrels a day", "global_span": [ 21354, 21375 ] } ], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 27, "sub_chunk_id": 0, "sentences": "Operator: And the next question comes from Roger Read with Wells Fargo.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 28, "sub_chunk_id": 0, "sentences": "Roger Read: Hey. Good morning.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 29, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Good morning, Roger.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 30, "sub_chunk_id": 0, "sentences": "Roger Read: Good morning, Mike. And, yeah, welcome to Texas. If we could maybe dig into the Gulf of Mexico, as you said, the first kind of 20,000 PSI development. What are the -- given that it ’s new, what are some of the experiences you ’ ve had or the industry has had with this level of pressure. And what are some of the things we should be watching for, maybe in another way of asking the question, how have you gotten comfortable on the technology side in terms of bringing this forward and developments behind it?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 31, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. I might make a couple of comments on that and then ask Eimear who before becoming our Chief Financial Officer was our Chief Technology Officer. The moving into that pressure regime, obviously you need bigger equipment because you got to contain higher pressures, you ’ ve got greater wall thickness on all your equipment, it ’s heavier, you need heavier hook loads to lift and deploy equipment. You ’ ve got a lot of technology qualification to satisfy our own standards and to satisfy the regulator that every element of your kit is proven at pressures well beyond what anything that it will see in service. So, this goes from components large to small and you get into tighter tolerances and a whole host of things as you step up the pressure regime there. So, I would say that we ’ ve worked closely with some of our suppliers who have developed the specific equipment that is in place and we ’re very pleased with everything from the drilling rigs and the equipment that ’s used in drilling to trees and production kit both subsurface and surface. Eimear, you might have some thoughts from your technology days to share with folks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 32, "sub_chunk_id": 0, "sentences": "Eimear P. Bonner: Yes. Mike, you hit on one key thing and that is that the partnership that was demonstrated here with ourselves with industry partners to be able to deliver the first 20ks subsea development. And to your question in terms of how did we get comfortable, I think it was because we brought the best of our engineers, the best of our suppliers, and the best technology that we had, several examples of technology, proprietary technology that we brought. And the extensive, testing, quality testing that took place before we went out to the field. So, some things to mention, just to put that in perspective, we delivered the first 20k subsea well completion and subsea production trees and manifolds. So, this is the core equipment that protects us from loss of containment and ensures that we safely and reliably can operate the field. We drilled wells. We developed a drilling rig. We built a drilling rig with our partners to enable drilling at these depths and the equipment to allow us to do that. That had very special dynamic positioning and technology as well. On the subsurface side, when we think about the prospect and how we were able to see the prospect and get some a really good accurate image of the prospect, we used our proprietary seismic technology here. This is more of our in - house Chevron proprietary technology to help us with that image and that enabled us to make the right decisions about the development and optimize the development. So, those are just a couple of examples of where the surface and the subsurface technology really enabled us to achieve this outcome.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 33, "sub_chunk_id": 0, "sentences": "Operator: And the next question will come from Devin McDermott with Morgan Stanley.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 34, "sub_chunk_id": 0, "sentences": "Devin McDermott: Hey. Good morning. Thanks for taking my question. Eimear, I wanted to stick with you, and I have a bit of a strategy question for you. If we kind of put together several of things that ’s been talked about on this call so far, the TCO start up, strong Permian production growth, rising production in the Gulf of Mexico, it all kind of materializes in the form of this inflection in free cash flow as we go into 2025 and beyond. And Chevron has historically had four, I think, very consistent priorities for use of cash. But now that you ’ ve had some time in the CFO ’s team, I was wondering if you could talk about your views for the optimal use of cash, especially in the context of your current low leverage levels and how you ’re thinking about the trade - off between further dividend growth or more buybacks as cash flow rises over the next few years?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 35, "sub_chunk_id": 0, "sentences": "Eimear P. Bonner: Yes. Thanks, Devin. Well, I ’ m thinking about it consistent with how we have for decades and consistent with our long - standing financial priorities. So, just to step through them, first, it ’s growing the dividend, that ’s our first priority. So, cash that enables us to continue with our track record of growing the dividend for 37 years. So, that ’s the first priority. And when we look at the projects that we have and the growth that ’s underway that Mike talked about, our 10% free cash flow growth really supports future dividend increases. So, when we think of cash, that ’s where it goes, first and foremost. Secondly, is to invest in the business to deliver profitable growth and do that capital efficiently. This is an area of leadership for Chevron when you look at the percentage of the CapEx as a percentage of CFFO. So, I ’ m focused on ensuring that we maintain leadership in this area. To your point about the balance sheet, our third priority is to maintain a strong balance sheet, and we are currently under levered and we expect and are comfortable to modestly relever over time, but to stay within historical ranges. And we look at our balance sheet as an asset to create value, and manage volatility and ensure steady capital returns through the cycle. And when we ’ ve satisfied all three of the financial priorities, the fourth is to return surplus cash to shareholders through buybacks and that ’s what we intend to do and we take a multi - year view of that considering a range of commodity prices. So, in my time with the company in the business side and on the corporate side, I ’ ve seen how these financial priorities have served us well and they ’ll continue to serve us well. And so in my time, they ’re not going to change. Thanks.", "ground_truth_output": { "entities": [ { "id": 71, "label": "Traditional", "start_offset": 450, "end_offset": 456, "text": "growth", "global_span": [ 27921, 27927 ] }, { "id": 72, "label": "Value", "start_offset": 502, "end_offset": 505, "text": "10%", "global_span": [ 27973, 27976 ] }, { "id": 73, "label": "Traditional", "start_offset": 506, "end_offset": 527, "text": "free cash flow growth", "global_span": [ 27977, 27998 ] } ], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 36, "sub_chunk_id": 0, "sentences": "Operator: And the next question comes from Nitin Kumar with Mizuho.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 37, "sub_chunk_id": 0, "sentences": "Nitin Kumar: Hi, good morning, Mike, and thanks for taking our questions. I want to maybe shift focus on the downstream side. Last quarter you had a heavy turnaround schedule and just the way cracks worked out, it probably was n’t the best timing. As you ’re coming out of that turnaround, what are you seeing in your markets? And if you can maybe touch on renewable diesel specifically with Geismar coming on later this year, what ’s the outlook for economics of biofuels?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 38, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. So, you ’re right. We had some turnaround activity in the second quarter that occurred during the more attractive margin portion of the quarter and then we had more capacity back online as margins dropped precipitously in some cases. So, we did n’t capture as much as we could because of the timing of some of our activity. Globally product demand is decent. Overall demand for oil is going to be up 1% to 2%. Most products have recovered to pre - COVID levels plus or minus. And we see, I think decent economic growth underway around the world. We ’ ve had some new refining capacity come into the system in the Middle East, in Africa, in Mexico, and in Asia. So, it ’s coming online, so it ’s in startup. So, you ’re seeing some capacity come online and inventories have all risen over the first half of the year and they ’re at or above five - year levels. For some period of time, we ’ ve been of the view that margins were going to revert towards mid cycle by this year or next year and that ’s certainly I think what we see going on in some cases. Mid cycle has been pretty tough in some parts of the world and we ’re back to pretty tough margins. And that ’s maybe a way to transition to renewable fuels, where these are markets that are heavily influenced not just by supply and demand, but also by policy, because a lot of the value is driven through the credits associated with those. We ’ ve seen periods of time in the past where the targets did n’t come out of EPA until after the compliance year had already ended, which was challenging. We ’ ve now seen APA get ahead of the game and set numbers well out into the future. And it ’s hard for people to anticipate markets. And so right now what we ’ ve got is a market where a lot of capacity has been incentivized and we do n’t have the RBOs that necessarily match up with it. So, in an over supplied market credit values are down both at federal level and at state level. We welcome to our margin business. This is the way value chain businesses work at least through my career, much of which has been in the Downstream and you need to be prepared for it. And you need to have a capital efficient investment philosophy, which we do. Some of our refinery investments have been to create flexibility to move back and forth between fossil feed and renewable feed. We ’ve done that. We ’ ve idled some plants, which you do when you ’re in a period like this and we ’re completing the Geismar project, which will give us scale and importantly feedstock flexibility. And in the margin business, you need to have access to affordable, competitive and reliable feedstock. The flexibility that Geismar will have will allow it to compete very well. We ’ ve got another project underway, a joint venture with Bunge to move back into the bean crush portion of the value chain, which further helps us assure competitive supply into Geismar. But this is a business where we ’re going to see periods of time where margins are tough and you probably see some competitive capacity under pressure and so that shutdown and over time then they ’ll tend to cycle the other way. So, we ’re in this business for the long haul. We think drop in renewable fuels are going to be part of creating a lower carbon energy system in the future. And we ’re very committed to that business through good times and through the challenging times we ’ll be pragmatic, efficient and value chain oriented in optimizing that business.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 39, "sub_chunk_id": 0, "sentences": "Operator: And the next question will come from Jason Gabelman with TD Cowen.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 40, "sub_chunk_id": 0, "sentences": "Jason Gabelman: Good morning. Thanks for taking my question. You guys have built out a pretty larger exploration portfolio the past few years and I think you ’re starting to delineate some of that acreage. And I ’ m wondering, out of the positions you ’ ve amassed around the world, what you ’re most excited about? And then related to that specifically on Namibia, there ’s a lot of interest in the market about that region. Could you remind us what your drilling plans are for that region this year and any interest in consolidating the space given a number of small and large players over there? Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 41, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. Thanks, Jason. You ’re right. We have added some new acreage to our portfolio and some acreage that ’s in areas that are kind of more frontier than some of the stuff we ’ ve historically held. Look, we ’re excited about I ’ m excited about any number of regions in the world. I ’ll start with the Gulf of Mexico where we ’ ve got projects lined up as I mentioned earlier and a lot of expertise. We ’re one of the largest leaseholders in the Deepwater Gulf of Mexico. And as we move into these higher pressure regimes, we ’re well positioned to continue to have exploration success and development success there. The second one I ’ll point to is the Eastern Mediterranean, where we ’ ve got interesting acreage in the offshore western portion waters off of Egypt. We ’ve got some plans to drill there. We ’ ve got a discovery where we ’ll do a delineation well on the Nargis discovery. And then the third one I would point to is West Africa and that would include existing positions in places like Nigeria, Angola, Equatorial Guinea and Namibia, where there ’s certainly been a lot of interest lately in Namibia. We ’ve seen others make some discoveries. In the Orange Basin, we ’ ve got a lease PEL 90, which sits just outboard of where an interesting discovery has recently been made. And we ’ ve got a well there that will spud in the fourth quarter of this year. It will be completed in early 2025. We ’ve already executed the Reagan well construction contract. So, we ’re very excited to see what that delivers. In terms of additional acreage in Nigeria, we farmed into a block in the Walvis Basin, PEL 82 and are interested in continuing to add to our acreage position there if opportunities present themselves. So, we ’ ve got three ways of bringing resource into the company. You can explore for it and discover it. You can acquire it or you can unlock it through technology and all three of those receive lot of attention. We ’ ve got talented people working in each area to bring resource in through all of them. But I ’ m excited about some of the new exploration acreage that we ’re adding. Thanks, Jason.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 42, "sub_chunk_id": 0, "sentences": "Operator: The next question comes from Bob Brackett with Bernstein.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 43, "sub_chunk_id": 0, "sentences": "Bob Brackett: Good morning. I had a question given that you have a unique position in Venezuela and we ’re watching an election and a post - election unfold. Any comments on what you ’re seeing from your folks on the ground? And maybe if there ’s any vision, what your role in Venezuela could look like in a range of presidential outcomes?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 44, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. Bob, on the ground, what we ’re doing is really monitoring the situation. You ’ ve seen the news coverage and our focus remains on the safety of our employees and their families and the integrity of the assets in our joint venture operations. We ’ ve been a constructive presence in Venezuela for most of the last 100 years. We conduct our business there in compliance with their laws as well as the laws of the U.S, which in this particular case are administered under a general license issued by the Treasury Department. And we ’ ve seen some encouraging results here recently since the issuance of the most recent general license, our JVs are produced around 200,000 barrels a day. We ’re being repaid debt that we have been owed and are steadily achieving that objective. We ’ ve also seen the extension of some of the concessions on some of these non - operated joint ventures that we are involved in. So, we remain apolitical in Venezuela and in other countries. We ’re there to help develop the economy, support the people, create jobs and not get involved in politics which can swing in any country from party to party. And we have found that it ’s best to work with the government that ’s in power, respect the fact that that is the government that we have, but not take positions that would make it difficult for us to continue to work with a subsequent government. So, we do n’t have a role in selecting governments, we ’re a commercial player, not a political player. And again, our focus is really on keeping our people safe and the assets protected. Thank you, Bob.", "ground_truth_output": { "entities": [ { "id": 74, "label": "Traditional", "start_offset": 664, "end_offset": 667, "text": "JVs", "global_span": [ 37183, 37186 ] }, { "id": 75, "label": "Traditional", "start_offset": 672, "end_offset": 680, "text": "produced", "global_span": [ 37191, 37199 ] }, { "id": 76, "label": "Value", "start_offset": 688, "end_offset": 709, "text": "200,000 barrels a day", "global_span": [ 37207, 37228 ] } ], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 45, "sub_chunk_id": 0, "sentences": "Operator: And next is Neal Dingmann with Truist.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 46, "sub_chunk_id": 0, "sentences": "Neal Dingmann: Good morning. Thanks for getting in. Mike, my question for you and the team is just on OFS costs. I ’ m just wondering if you ’ ve seen any change in prices given the very recent fall in oil prices. And if so, or just going forward, would you expect to see maybe domestic cost hold while international stays firmer or vice versa?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 47, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes, certainly in the economy broadly speaking, we have seen inflation pressures easing and I think that ’s good for consumers, it ’s good for economic growth. These things vary across geographies and as you say, you can see different dynamics in the onshore and the offshore. We are seeing some softening of pressure in the onshore, some declining in prices for oil country or oil class tubulars, rigs, prop and trucking. Some of the frac services are more stable. We have a contracting approach that generally sets up index - based pricing over longer periods of time which tends to buffer increases. It can also buffer the decreases. So, we ’re not a big spot player. We tend to have longer term contracts and look for things that allow our suppliers to plan their work and allocate their people and resources accordingly. And some of these things lag on the way up, they lag a little bit on the way down. But I think in the onshore, you ’re right, you ’re seeing some easing of pressures. I think in the offshore, you ’re seeing a little bit of a reverse. There is more activity going on in the Deepwater. You ’re seeing rig rates firm in some cases. So, this is a place where we also take a longer term contracting approach. We ’ ve got multiple rigs contracted out over multiple years. They are typically laddered, so that they do n’t expire simultaneously and we ’ ve lagged into the market across the cycle, so that we ’re not exposed to any one particular point in time. So, certainly not the inflationary pressure we ’ ve seen a couple of years ago. Thank you, Neal.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 48, "sub_chunk_id": 0, "sentences": "Operator: And the next question comes from Geoff Jay with Daniel Energy Partners.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 49, "sub_chunk_id": 0, "sentences": "Geoff Jay: Hey, guys. This is, maybe a follow - up to Jason ’s question about exploration earlier, but I noticed you got involved in Uruguay back in March. Is that an analog to the Orange or Walvis basins? And just wonder if you can maybe update us on what you think the potential could be there and what the timeline of exploration might be there?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 50, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Yes. So, we did pick up a block off Uruguay and there are beliefs that there are certain conjugate margin analogs that we see on the South American side of the Atlantic. Obviously, there ’s a lot of work that needs to be done to explore those theories and in some instances we have seen evidence that supports it in other instances less so. So, we ’ ve also picked up some acreage in Brazil, in Suriname. So, across that whole Eastern Coast of South America, we have got some pretty good exposure and intend to do the geotechnical work and seismic work to understand the prospectivity of it. So, very early days on that particular prospect, but we ’re intrigued by it and it ’s an example of what I mentioned earlier that we ’re moving into some areas that are a little more frontier than where we ’ ve been over the last number of years.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 51, "sub_chunk_id": 0, "sentences": "Operator: And the next question will come from Betty Jiang with Barclays.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 52, "sub_chunk_id": 0, "sentences": "Betty Jiang: Good morning. Thanks for taking my question. I want to go back to the Permian. It ’s great to see the momentum, the operational momentum you ’re seeing on the operator side. Just given the triple fracs and certainly acceleration of the cycle time, curious how you think about this, pull forward of activity. Would you likely to do more with the same equipment, or would things slow down or ended up using less equipment? And also curious about what you ’re seeing on your royalty and non - operated production front as well?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 53, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Okay. Let me start with the royalty and non op first. We ’re continuing to see strong contributions from that. We ’ ve got line of sight to essentially all the AFEs this year across that acreage and it ’s been if you want to call it the upside performance we ’ ve seen this year has been spread across all three of those portions of our business, company operated royalty and NOJV. So, strong contributions from those two. When you get to the Permian, yes, these efficiencies have accelerated activity. We get through more lateral feet of wells, we complete more feet, we use more consumables and sand and everything as we do that. Some of the easing of pressure on cost of goods and inputs helps us offset that and so we are trying to manage, we are going to manage to our CapEx numbers. And you can expect us to balance out activity and capital. We ’re not going to get off to the races on capital. We ’re going to see very disciplined out of the budget is a budget. But the nice thing is we ’re getting -- because of the improved cycle times, improved efficiencies, we ’re getting more productivity out of the equipments, we ’re getting more production per unit of capital input and that really is the story here. So, you can expect us to land our capital as we ’ ve guided it at close to $5 billion and the production as we have guided in our prepared remarks.", "ground_truth_output": { "entities": [ { "id": 77, "label": "Traditional", "start_offset": 1250, "end_offset": 1256, "text": "expect", "global_span": [ 43273, 43279 ] }, { "id": 78, "label": "Traditional", "start_offset": 1272, "end_offset": 1279, "text": "capital", "global_span": [ 43295, 43302 ] }, { "id": 79, "label": "Value", "start_offset": 1313, "end_offset": 1323, "text": "$5 billion", "global_span": [ 43336, 43346 ] } ], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 54, "sub_chunk_id": 0, "sentences": "Operator: And our last question comes from John Royall with JPMorgan.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 55, "sub_chunk_id": 0, "sentences": "John Royall: Hi, good morning. Thanks for taking my question. So, my question is just if you could give some color on the downtime you saw both Gorgon and Wheatstone in 2Q. What was the source of those outages? And how are the facilities running now? And maybe include some color on the planned work you called out for Gorgon in 3Q?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 56, "sub_chunk_id": 0, "sentences": "Eimear P. Bonner: Yes, John. So, the down time in upstream in May and June was associated with some unplanned events in Gorgon and Wheatstone. So, on Gorgon, there was a blade failure. So, they had to take some time to repair that. They used the time when they were down to try and do as much maintenance as possible. On Wheatstone, they actually had a gas leak that was discovered by an operator. And we ’re always going to shut the plant down and repair any leaks in the spirit of operational excellence. So, they repaired that, it was on the fuel gas system and got things back up and running. So, the repairs were executed safely and efficiently and we still expect both of those assets to run with good reliability this year with top quartile performance. The Gorgon, asset turnaround is currently underway and that ’s going really well. So, we expect that to come in under the planned duration this quarter. And even with or despite the downtime, we expect to close the full year and deliver on the plant production for the combined Australia assets.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 57, "sub_chunk_id": 0, "sentences": "Michael K. Wirth: Thanks, John. I would like to thank everyone for your time today. We appreciate your interest in Chevron and your participation on today ’s call. Please stay safe and healthy. Justin, back to you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "CVX", "quarter": 2, "year": 2024, "date": "2024-08-02 11:00:00", "chunk_id": 58, "sub_chunk_id": 0, "sentences": "Operator: Thank you. This concludes Chevron ’s second quarter 2024 earnings conference call. You may now disconnect.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Elliot: Hello, and welcome to the Duke Energy Fourth Quarter and Year End 2024 earnings. My name is Elliot. I 'll be your coordinator today. I would now like to hand over to Abby Motsinger, Vice President of Investor Relations. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Abby Motsinger: Thank you, Elliot, and good morning, everyone. Welcome to Duke Energy 's fourth quarter 2024 earnings review and business update.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Elliot: Leading our call today is Lynn Good.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Abby Motsinger: Chair and CEO. Along with Harry Sideris, President, and Brian Savoy, CFO. Today 's discussion will include the use of non - GAAP financial measures and forward - looking information. Actual results may differ from forward - looking statements due to factors disclosed in today 's materials and in Duke Energy 's SEC filings. The appendix of today 's presentation includes supplemental information along with a reconciliation of non - GAAP financial measures. That, let me turn the call over to Lynn. Andy, thank you, and good morning, everyone. Today, we announced 2024 adjusted earnings per share of $5.90, finishing within our guidance range. 2024 was a year of great accomplishment, and in many ways, was defined by our response to hurricanes Helene and Milton. We were moved by our community 's outpouring of support and appreciation for our work during these historic storms. We also announced updated guidance today, including a 2025 earnings per share range of $6.17 to $6.42, with a midpoint of $6.30. An $83 billion capital plan, which drives 7.7% earnings - based growth. This capital represents infrastructure spending driven by growing jurisdictions and underpinned by robust regulatory processes, such as integrated resource plans and approved grid investments. And finally, the continuation of our 5% to 7% EPS growth rate through 2029 with the potential to earn higher in the range as the years progress. Duke Energy enters the back part of this decade in a position of strength, and we 're excited about the future. We 're committed to delivering strong earnings and earnings growth and cash flows for our investors and superior service to our customers and communities. Before we get further into 2025 guidance, let me acknowledge our key achievements in 2024. Turning to slide five, we continued our track record of regulatory execution with the approval of $45 billion of rate - based investments. The regulatory work of the last two years minimizes rate case exposure in 2025 and 2026. We also advanced generation and transmission through our integrated resource plans and CPCN approvals. And we continue to add solar in Florida with 1,500 megawatts now in service. And finally, I 'd like to acknowledge the Piedmont Natural Gas team. For the third consecutive year, the team earned the J.D. Power number one customer satisfaction ranking for natural gas service in the Southeast. And let me also just take a moment and acknowledge last month 's announcement. Effective April 1, Harry will become CEO and President of Duke Energy, and Ted Craver will assume the role of independent chair of the board. Therefore, today will be my last earnings call prior to retirement. It 's been an honor to lead this company, and I appreciate everyone who 's been on the journey with me. To our employees, thank you for your commitment to our company and customers. To our shareholders, thank you for your investment in Duke Energy. The capital you provide powers our success and makes the work we do possible. And to the analysts who cover our company, you play a valuable role in the investment community, and I ' ve appreciated your thoughtful research. And to Harry, thank you for being an incredible leader and adviser to me. As many of you know, Harry is a 29 - year veteran of the company. Experience in nearly every facet of our business, Harry raised his hand for every challenging assignment and has led this company to great success, thanks to his commitment to our investors, our employees, and our customers. With Harry as CEO and a strong experienced leadership team around him, Duke Energy is well positioned to execute the next phase of our business strategy, and I ' m confident in all that the company will achieve. So with that, I 'd like to turn the call over to Harry.", "ground_truth_output": { "entities": [ { "id": 0, "label": "Traditional", "start_offset": 916, "end_offset": 932, "text": "updated guidance", "global_span": [ 1351, 1367 ] }, { "id": 1, "label": "Traditional", "start_offset": 952, "end_offset": 981, "text": "2025 earnings per share range", "global_span": [ 1387, 1416 ] }, { "id": 2, "label": "Value", "start_offset": 985, "end_offset": 999, "text": "$6.17 to $6.42", "global_span": [ 1420, 1434 ] }, { "id": 3, "label": "Traditional", "start_offset": 1008, "end_offset": 1016, "text": "midpoint", "global_span": [ 1443, 1451 ] }, { "id": 4, "label": "Value", "start_offset": 1020, "end_offset": 1025, "text": "$6.30", "global_span": [ 1455, 1460 ] }, { "id": 5, "label": "Value", "start_offset": 1030, "end_offset": 1041, "text": "$83 billion", "global_span": [ 1465, 1476 ] }, { "id": 6, "label": "Value", "start_offset": 1069, "end_offset": 1073, "text": "7.7%", "global_span": [ 1504, 1508 ] }, { "id": 7, "label": "Traditional", "start_offset": 1074, "end_offset": 1082, "text": "earnings", "global_span": [ 1509, 1517 ] }, { "id": 8, "label": "Traditional", "start_offset": 1085, "end_offset": 1097, "text": "based growth", "global_span": [ 1520, 1532 ] }, { "id": 9, "label": "Value", "start_offset": 1329, "end_offset": 1337, "text": "5% to 7%", "global_span": [ 1764, 1772 ] }, { "id": 10, "label": "Traditional", "start_offset": 1338, "end_offset": 1353, "text": "EPS growth rate", "global_span": [ 1773, 1788 ] }, { "id": 11, "label": "Traditional", "start_offset": 1362, "end_offset": 1366, "text": "2029", "global_span": [ 1797, 1801 ] }, { "id": 12, "label": "Value", "start_offset": 1893, "end_offset": 1904, "text": "$45 billion", "global_span": [ 2328, 2339 ] }, { "id": 13, "label": "Traditional", "start_offset": 2149, "end_offset": 2165, "text": "solar in Florida", "global_span": [ 2584, 2600 ] }, { "id": 14, "label": "Value", "start_offset": 2171, "end_offset": 2186, "text": "1,500 megawatts", "global_span": [ 2606, 2621 ] }, { "id": 15, "label": "Traditional", "start_offset": 2187, "end_offset": 2201, "text": "now in service", "global_span": [ 2622, 2636 ] }, { "id": 16, "label": "Traditional", "start_offset": 2280, "end_offset": 2302, "text": "third consecutive year", "global_span": [ 2715, 2737 ] }, { "id": 17, "label": "Traditional", "start_offset": 2324, "end_offset": 2334, "text": "J.D. Power", "global_span": [ 2759, 2769 ] }, { "id": 18, "label": "Value", "start_offset": 2335, "end_offset": 2375, "text": "number one customer satisfaction ranking", "global_span": [ 2770, 2810 ] }, { "id": 19, "label": "Traditional", "start_offset": 2380, "end_offset": 2416, "text": "natural gas service in the Southeast", "global_span": [ 2815, 2851 ] }, { "id": 150, "label": "Traditional", "text": "capital plan", "start_offset": 1042, "end_offset": 1054, "global_span": [ 1477, 1489 ] }, { "id": 151, "label": "Traditional", "text": "approval of", "start_offset": 1881, "end_offset": 1892, "global_span": [ 2316, 2327 ] }, { "id": 152, "label": "Traditional", "text": "rate - based investments", "start_offset": 1908, "end_offset": 1932, "global_span": [ 2343, 2367 ] } ], "relations": [ { "id": 1, "entity_ids": [ 0, 1, 2 ], "description": "Value_of" }, { "id": 2, "entity_ids": [ 0, 1, 3, 4 ], "description": "Value_of" }, { "id": 3, "entity_ids": [ 5, 150 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 6, 7, 8 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 9, 10, 11 ], "description": "Value_of" }, { "id": 6, "entity_ids": [ 12, 151, 152 ], "description": "Value_of" }, { "id": 7, "entity_ids": [ 13, 14, 15 ], "description": "Value_of" }, { "id": 8, "entity_ids": [ 16, 17, 18, 19 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "Harry Sideris: Thank you, Lynn, for your kind words and for your mentorship over many years. Through your leadership, Duke Energy has become an industry - leading fully regulated utility that is ideally positioned for the growth ahead. I ' m deeply honored by the confidence the board has placed in me and the outpouring of support I ' ve received from employees, industry leaders, and public officials, as well as from many of you in the investment community. It is hard to imagine a more compelling time to lead Duke Energy. We are passionate about our mission to power the lives of our customers and the vitality of our communities. I look forward to the opportunities ahead with optimism around our strategy, our operating culture, and our team. Turning to Slide six, I assume this new role at a pivotal point for our company and industry. Share the new administration 's commitment to ensuring the availability of reliable and affordable energy to meet our country 's aspirations for technology leadership and economic growth. These priorities align with our business strategy, and we look forward to working with President Trump, both parties in Congress, and our states to build, operate, and protect the critical infrastructure needed to deliver on these goals. To that end, we are executing our all - of - the - above generation strategy to meet growing demand and replace aging infrastructure. Our diverse mix of new resources includes dispatchable natural gas, which is essential to maintaining reliability and affordability for customers and complements our substantial investments in renewables. In the Carolinas, we have started construction on over two gigawatts of natural gas generation that was approved last year. And we are filing CPCNs for our next round of gas plants in the Carolinas and Indiana this quarter. We ' ve secured turbines and gas supply for each of these sites, expediting our ability to connect megawatts to support economic development growth. With our generation investments accelerating, important grid investments will continue to be a significant portion of our five - year capital plan, ensuring the reliability and resiliency of our system. With 320,000 line miles, we operate the largest transmission and distribution system in the nation. Working with stakeholders across our jurisdictions, we have tailored state - specific multiyear investment plans that strengthen the grid and ensure our ability to connect new large load customers. The path forward is clear as we navigate this decade of record infrastructure build, and we remain focused on delivering value to our shareholders while meeting our customers ' energy demands now and into the future. With that, let me turn the call over to Brian.", "ground_truth_output": { "entities": [ { "id": 20, "label": "Non_Traditional", "start_offset": 1636, "end_offset": 1656, "text": "started construction", "global_span": [ 5883, 5903 ] }, { "id": 21, "label": "Value", "start_offset": 1660, "end_offset": 1678, "text": "over two gigawatts", "global_span": [ 5907, 5925 ] }, { "id": 22, "label": "Traditional", "start_offset": 1682, "end_offset": 1704, "text": "natural gas generation", "global_span": [ 5929, 5951 ] }, { "id": 23, "label": "Value", "start_offset": 2191, "end_offset": 2198, "text": "320,000", "global_span": [ 6438, 6445 ] }, { "id": 24, "label": "Non_Traditional", "start_offset": 2199, "end_offset": 2209, "text": "line miles", "global_span": [ 6446, 6456 ] }, { "id": 25, "label": "Value", "start_offset": 2226, "end_offset": 2233, "text": "largest", "global_span": [ 6473, 6480 ] }, { "id": 26, "label": "Non_Traditional", "start_offset": 2234, "end_offset": 2284, "text": "transmission and distribution system in the nation", "global_span": [ 6481, 6531 ] } ], "relations": [ { "id": 9, "entity_ids": [ 20, 21, 22 ], "description": "Value_of" }, { "id": 10, "entity_ids": [ 23, 24 ], "description": "Value_of" }, { "id": 11, "entity_ids": [ 25, 26 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Brian Savoy: Thanks, Harry, and good morning, everyone. As Lynn mentioned, our full - year adjusted earnings per share of $5.90 was within our 2024 guidance range. For the year, we saw top - line growth from rate cases and riders across our jurisdictions, which was partially offset by the impacts of a historic hurricane season. For additional details on 2024 results, please refer to supporting materials in today 's news release. Moving to slide eight. We set our 2025 EPS guidance range at $6.17 to $6.42. The $6.30 midpoint represents around 7% growth over 2024. This trend is a continuation of the 6% annual growth we ' ve delivered since 2022. Within the electric segment, constructive rate case outcomes over the past two years will continue to drive results. In January, we implemented our new multi - year rate plan in Florida and entered year two of our multi - year rate plan in North Carolina. See benefits from the DEC South Carolina rate case and our recently approved Indiana rate case, as well as growth from grid riders in the Midwest and Florida. In addition to rate activity, our plan assumes normal weather and retail sales growth of 1.5% to 2% in 2025. Growth in our gas segment will be driven by the Piedmont, North Carolina rate case, and annual rate mechanisms in South Carolina and Tennessee, as well as customer additions and integrity management investments. Finally, we expect results of the other segment to be driven by higher interest expense and modest share dilution to fund our growing capital plan. Turning to slide nine, beginning in 2027, we see an acceleration in volumes, with annual load growth increasing to 3% to 4% at the enterprise. Our confidence in this forecast is underpinned by significant economic development projects coming online, particularly in the Carolinas, which we see growing at 4% to 5% over the same period. Our economic development pipeline reflects advanced manufacturing projects across multiple sectors, as well as data centers. As a reminder, we take a risk - adjusted approach as we evaluate which projects to include in our forecast. We incorporate just a portion of our total pipeline, focusing on those with letter agreements or in very late - stage development. We then utilize discrete project - level analysis to ensure confidence in when the projects will begin commercial operation and require energy supply. In the near term, we 're planning for annual load growth between 1.5% to 2% at the enterprise. Our forecast is supported by strong residential customer growth, improving industrial activity, and the expansion of new and existing businesses across our service territories. Moving to slide ten. Our five - year capital plan is now $83 billion, a 12% increase versus our prior plan. The majority of the increase is driven by generation investments reflected in our plan. These investments ramp up over the five - year period as load accelerates and we replace aging infrastructure. In addition, grid investments represent around 45% of our capital plan as we continue to improve the reliability and resiliency of our system. With our updated capital plan, we now expect roughly 7.7% annual earnings base growth through 2029, a 50 basis point increase from our prior plan. Supporting this growth are efficient recovery mechanisms, which are critical to maintaining a healthy balance sheet, mitigating regulatory lag, and smoothing customer rate impacts. The need for infrastructure to support our growing regions is not limited to this five - year plan. We have a long runway of investment opportunities that extend well into the next decade. Turning to slide eleven, as we have demonstrated over many years, our commitment to our current credit ratings and a strong balance sheet will continue to be a top priority. We are targeting 14% FFO to debt by the end of 2025 and expect to improve above 14% over the five - year plan. Our long - term target provides over 100 basis points of cushion above our Moody 's downgrade threshold and over 200 basis points above our S&P downgrade threshold. To support these credit objectives and fund accretive growth, we increased equity funding to $6.5 billion over the next five years. This increase in equity funds approximately 40% of our capital plan. We will continue to use our at - the - market and dividend reinvestment programs to efficiently fund our equity needs. As Harry mentioned, we ' ve delivered many constructive regulatory outcomes over the past two years. These results enable timely recovery of investments and drive considerable improvement in our operating cash flow. In addition, we continue to see a strong market for energy tax credits. In 2024, we efficiently monetized over $500 million of credits that will benefit customers over time. Before we open it up for questions, let me close with slide twelve. With a strong track record of regulatory execution, we begin 2025 with confidence in our plan, and our commitment to the dividend remains unchanged. We understand its importance to our shareholders, and this year marks the 99th consecutive year of paying a quarterly cash dividend. As we look ahead, our robust capital plan, strong customer growth, and constructive jurisdictions position us to deliver 5% to 7% growth through 2029 with the potential to earn higher in the range as load growth accelerates in the back end of the plan. Look forward to updating you on our progress throughout the year. That, we 'll open the line for your questions.", "ground_truth_output": { "entities": [ { "id": 27, "label": "Traditional", "start_offset": 80, "end_offset": 84, "text": "full", "global_span": [ 7074, 7078 ] }, { "id": 28, "label": "Traditional", "start_offset": 87, "end_offset": 119, "text": "year adjusted earnings per share", "global_span": [ 7081, 7113 ] }, { "id": 29, "label": "Value", "start_offset": 123, "end_offset": 128, "text": "$5.90", "global_span": [ 7117, 7122 ] }, { "id": 30, "label": "Traditional", "start_offset": 468, "end_offset": 491, "text": "2025 EPS guidance range", "global_span": [ 7462, 7485 ] }, { "id": 31, "label": "Value", "start_offset": 495, "end_offset": 509, "text": "$6.17 to $6.42", "global_span": [ 7489, 7503 ] }, { "id": 32, "label": "Value", "start_offset": 515, "end_offset": 529, "text": "$6.30 midpoint", "global_span": [ 7509, 7523 ] }, { "id": 33, "label": "Value", "start_offset": 548, "end_offset": 550, "text": "7%", "global_span": [ 7542, 7544 ] }, { "id": 34, "label": "Traditional", "start_offset": 551, "end_offset": 567, "text": "growth over 2024", "global_span": [ 7545, 7561 ] }, { "id": 35, "label": "Value", "start_offset": 605, "end_offset": 607, "text": "6%", "global_span": [ 7599, 7601 ] }, { "id": 36, "label": "Traditional", "start_offset": 608, "end_offset": 621, "text": "annual growth", "global_span": [ 7602, 7615 ] }, { "id": 37, "label": "Traditional", "start_offset": 1133, "end_offset": 1152, "text": "retail sales growth", "global_span": [ 8127, 8146 ] }, { "id": 38, "label": "Value", "start_offset": 1156, "end_offset": 1166, "text": "1.5% to 2%", "global_span": [ 8150, 8160 ] }, { "id": 39, "label": "Traditional", "start_offset": 1167, "end_offset": 1174, "text": "in 2025", "global_span": [ 8161, 8168 ] }, { "id": 40, "label": "Traditional", "start_offset": 1588, "end_offset": 1600, "text": "acceleration", "global_span": [ 8582, 8594 ] }, { "id": 41, "label": "Traditional", "start_offset": 1604, "end_offset": 1611, "text": "volumes", "global_span": [ 8598, 8605 ] }, { "id": 42, "label": "Traditional", "start_offset": 1618, "end_offset": 1650, "text": "annual load growth increasing to", "global_span": [ 8612, 8644 ] }, { "id": 43, "label": "Value", "start_offset": 1651, "end_offset": 1659, "text": "3% to 4%", "global_span": [ 8645, 8653 ] }, { "id": 44, "label": "Traditional", "start_offset": 1830, "end_offset": 1837, "text": "growing", "global_span": [ 8824, 8831 ] }, { "id": 45, "label": "Value", "start_offset": 1841, "end_offset": 1849, "text": "4% to 5%", "global_span": [ 8835, 8843 ] }, { "id": 46, "label": "Traditional", "start_offset": 2425, "end_offset": 2451, "text": "annual load growth between", "global_span": [ 9419, 9445 ] }, { "id": 47, "label": "Value", "start_offset": 2452, "end_offset": 2462, "text": "1.5% to 2%", "global_span": [ 9446, 9456 ] }, { "id": 48, "label": "Traditional", "start_offset": 2684, "end_offset": 2688, "text": "five", "global_span": [ 9678, 9682 ] }, { "id": 49, "label": "Traditional", "start_offset": 2691, "end_offset": 2708, "text": "year capital plan", "global_span": [ 9685, 9702 ] }, { "id": 50, "label": "Value", "start_offset": 2716, "end_offset": 2727, "text": "$83 billion", "global_span": [ 9710, 9721 ] }, { "id": 51, "label": "Value", "start_offset": 2731, "end_offset": 2734, "text": "12%", "global_span": [ 9725, 9728 ] }, { "id": 52, "label": "Traditional", "start_offset": 2735, "end_offset": 2743, "text": "increase", "global_span": [ 9729, 9737 ] }, { "id": 53, "label": "Value", "start_offset": 3013, "end_offset": 3016, "text": "45%", "global_span": [ 10007, 10010 ] }, { "id": 54, "label": "Value", "start_offset": 3162, "end_offset": 3166, "text": "7.7%", "global_span": [ 10156, 10160 ] }, { "id": 55, "label": "Traditional", "start_offset": 3167, "end_offset": 3194, "text": "annual earnings base growth", "global_span": [ 10161, 10188 ] }, { "id": 56, "label": "Value", "start_offset": 3211, "end_offset": 3213, "text": "50", "global_span": [ 10205, 10207 ] }, { "id": 57, "label": "Traditional", "start_offset": 3214, "end_offset": 3234, "text": "basis point increase", "global_span": [ 10208, 10228 ] }, { "id": 58, "label": "Traditional", "start_offset": 3807, "end_offset": 3816, "text": "targeting", "global_span": [ 10801, 10810 ] }, { "id": 59, "label": "Value", "start_offset": 3817, "end_offset": 3820, "text": "14%", "global_span": [ 10811, 10814 ] }, { "id": 60, "label": "Traditional", "start_offset": 3821, "end_offset": 3851, "text": "FFO to debt by the end of 2025", "global_span": [ 10815, 10845 ] }, { "id": 61, "label": "Traditional", "start_offset": 3866, "end_offset": 3873, "text": "improve", "global_span": [ 10860, 10867 ] }, { "id": 62, "label": "Value", "start_offset": 3880, "end_offset": 3883, "text": "14%", "global_span": [ 10874, 10877 ] }, { "id": 63, "label": "Traditional", "start_offset": 3893, "end_offset": 3897, "text": "five", "global_span": [ 10887, 10891 ] }, { "id": 64, "label": "Traditional", "start_offset": 3900, "end_offset": 3909, "text": "year plan", "global_span": [ 10894, 10903 ] }, { "id": 65, "label": "Traditional", "start_offset": 3915, "end_offset": 3919, "text": "long", "global_span": [ 10909, 10913 ] }, { "id": 66, "label": "Traditional", "start_offset": 3922, "end_offset": 3933, "text": "term target", "global_span": [ 10916, 10927 ] }, { "id": 67, "label": "Value", "start_offset": 3948, "end_offset": 3964, "text": "100 basis points", "global_span": [ 10942, 10958 ] }, { "id": 68, "label": "Value", "start_offset": 4024, "end_offset": 4040, "text": "200 basis points", "global_span": [ 11018, 11034 ] }, { "id": 69, "label": "Traditional", "start_offset": 4041, "end_offset": 4074, "text": "above our S&P downgrade threshold", "global_span": [ 11035, 11068 ] }, { "id": 70, "label": "Traditional", "start_offset": 4141, "end_offset": 4165, "text": "increased equity funding", "global_span": [ 11135, 11159 ] }, { "id": 71, "label": "Value", "start_offset": 4170, "end_offset": 4181, "text": "6.5 billion", "global_span": [ 11164, 11175 ] }, { "id": 72, "label": "Value", "start_offset": 4238, "end_offset": 4255, "text": "approximately 40%", "global_span": [ 11232, 11249 ] }, { "id": 73, "label": "Traditional", "start_offset": 4263, "end_offset": 4275, "text": "capital plan", "global_span": [ 11257, 11269 ] }, { "id": 74, "label": "Traditional", "start_offset": 4708, "end_offset": 4717, "text": "monetized", "global_span": [ 11702, 11711 ] }, { "id": 75, "label": "Value", "start_offset": 4723, "end_offset": 4735, "text": "$500 million", "global_span": [ 11717, 11729 ] }, { "id": 76, "label": "Traditional", "start_offset": 4739, "end_offset": 4746, "text": "credits", "global_span": [ 11733, 11740 ] }, { "id": 77, "label": "Traditional", "start_offset": 5186, "end_offset": 5201, "text": "customer growth", "global_span": [ 12180, 12195 ] }, { "id": 78, "label": "Value", "start_offset": 5257, "end_offset": 5265, "text": "5% to 7%", "global_span": [ 12251, 12259 ] }, { "id": 79, "label": "Traditional", "start_offset": 5266, "end_offset": 5285, "text": "growth through 2029", "global_span": [ 12260, 12279 ] }, { "id": 153, "label": "non_traditional", "text": "versus our prior plan", "start_offset": 2744, "end_offset": 2765, "global_span": [ 9738, 9759 ] }, { "id": 154, "label": "Traditional", "text": "expect ", "start_offset": 3147, "end_offset": 3154, "global_span": [ 10141, 10148 ] }, { "id": 155, "label": "Traditional", "text": " through 2029", "start_offset": 3194, "end_offset": 3207, "global_span": [ 10188, 10201 ] }, { "id": 156, "label": "Traditional", "text": "from our prior plan", "start_offset": 3235, "end_offset": 3254, "global_span": [ 10229, 10248 ] }, { "id": 157, "label": "Traditional", "text": "expect ", "start_offset": 3856, "end_offset": 3863, "global_span": [ 10850, 10857 ] }, { "id": 158, "label": "Traditional", "text": "cushion above our Moody 's downgrade threshold", "start_offset": 3968, "end_offset": 4014, "global_span": [ 10962, 11008 ] }, { "id": 159, "label": "Traditional", "text": " next five years", "start_offset": 4190, "end_offset": 4206, "global_span": [ 11184, 11200 ] }, { "id": 160, "label": "Traditional", "text": "funds", "start_offset": 4232, "end_offset": 4237, "global_span": [ 11226, 11231 ] } ], "relations": [ { "id": 12, "entity_ids": [ 27, 28, 29 ], "description": "Value_of" }, { "id": 13, "entity_ids": [ 30, 31 ], "description": "Value_of" }, { "id": 14, "entity_ids": [ 30, 32 ], "description": "Value_of" }, { "id": 15, "entity_ids": [ 33, 34 ], "description": "Value_of" }, { "id": 16, "entity_ids": [ 35, 36 ], "description": "Value_of" }, { "id": 17, "entity_ids": [ 37, 38, 39 ], "description": "Value_of" }, { "id": 18, "entity_ids": [ 40, 41, 42, 43 ], "description": "Value_of" }, { "id": 19, "entity_ids": [ 46, 47 ], "description": "Value_of" }, { "id": 20, "entity_ids": [ 48, 49, 50 ], "description": "Value_of" }, { "id": 21, "entity_ids": [ 51, 52 ], "description": "Value_of" }, { "id": 22, "entity_ids": [ 48, 49, 51, 52, 153 ], "description": "Value_of" }, { "id": 23, "entity_ids": [ 54, 55, 154, 155 ], "description": "Value_of" }, { "id": 24, "entity_ids": [ 55, 56, 57, 154, 156 ], "description": "Value_of" }, { "id": 25, "entity_ids": [ 58, 59, 60 ], "description": "Value_of" }, { "id": 26, "entity_ids": [ 61, 62, 63, 64, 157 ], "description": "Value_of" }, { "id": 27, "entity_ids": [ 65, 66, 67, 158 ], "description": "Value_of" }, { "id": 28, "entity_ids": [ 68, 69 ], "description": "Value_of" }, { "id": 29, "entity_ids": [ 70, 71, 159 ], "description": "Value_of" }, { "id": 30, "entity_ids": [ 72, 73, 160 ], "description": "Value_of" }, { "id": 31, "entity_ids": [ 74, 75, 76 ], "description": "Value_of" }, { "id": 32, "entity_ids": [ 77, 78, 79 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "Operator: Thank you. When preparing to ask your question, please ensure your device is unmuted locally. First question comes from Shar Pourreza with Guggenheim Partners. Your line is open. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Shar Pourreza: Good morning. Can you hear me?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Harry Sideris: Good morning. Yes. Good morning.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Shar Pourreza: So, obviously, you guys have pretty good visibility now. The CapEx is updated. Financing is updated. You do n't have a lot of regulatory uncertainty. Just on the EPS CAGR, Brian, you mentioned this and Lynn mentioned this. Just higher in the range comments in the prepared, are we just basically guiding towards top end of that range? And with the credit metric targets, you know, you have out there, the over 100 bps above Moody 's, 100 bps above S&P. Brian, can you just put a bit of a finer point on a specific target range versus the quote - unquote over language you guys have out there? Thanks.", "ground_truth_output": { "entities": [ { "id": 80, "label": "Value", "start_offset": 426, "end_offset": 433, "text": "100 bps", "global_span": [ 13224, 13231 ] }, { "id": 81, "label": "Traditional", "start_offset": 434, "end_offset": 445, "text": "above Moody", "global_span": [ 13232, 13243 ] }, { "id": 82, "label": "Value", "start_offset": 450, "end_offset": 453, "text": "100", "global_span": [ 13248, 13251 ] }, { "id": 83, "label": "Traditional", "start_offset": 454, "end_offset": 468, "text": "bps above S&P.", "global_span": [ 13252, 13266 ] } ], "relations": [ { "id": 33, "entity_ids": [ 80, 81 ], "description": "Value_of" }, { "id": 34, "entity_ids": [ 82, 83 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Brian Savoy: Yeah. I 'll start with the EPS chart. Thanks for the question. You know, as we look at our plan and see the load growth accelerating in 2027 through 2029, clearly, the opportunity is there to earn the top half of the range, and you 're exactly right. That 's what we 're alluding to. It 's based on the economic development pipeline we have that continues to grow by the day and the ability to serve this growing load. So we clearly see the 5% to 7% over the five years in the top half in the back end of the plan. On the credit, you know, we 're very pleased. We finished 2024 at 13.9% FFO to debt in spite of the storms that we saw. We were expecting some pressure from the storms. We saw it, but we overcame it because the operating cash flow in our business is accelerating. And that 's based on regulatory outcomes that we ' ve experienced over the past couple of years. As we look out in time, we ' ve guided to above 14%, which gives us over 100 basis points like you mentioned above Moody 's downgrade threshold and over 200 in S&P. We feel like that 's the right target for now, above 14. We will come up with specific guidance as the plan progresses.", "ground_truth_output": { "entities": [ { "id": 84, "label": "Value", "start_offset": 455, "end_offset": 463, "text": "5% to 7%", "global_span": [ 13869, 13877 ] }, { "id": 85, "label": "Value", "start_offset": 595, "end_offset": 600, "text": "13.9%", "global_span": [ 14009, 14014 ] }, { "id": 86, "label": "Traditional", "start_offset": 601, "end_offset": 612, "text": "FFO to debt", "global_span": [ 14015, 14026 ] }, { "id": 87, "label": "Traditional", "start_offset": 740, "end_offset": 759, "text": "operating cash flow", "global_span": [ 14154, 14173 ] }, { "id": 88, "label": "Value", "start_offset": 779, "end_offset": 791, "text": "accelerating", "global_span": [ 14193, 14205 ] }, { "id": 89, "label": "Traditional", "start_offset": 922, "end_offset": 931, "text": "guided to", "global_span": [ 14336, 14345 ] }, { "id": 90, "label": "Value", "start_offset": 932, "end_offset": 941, "text": "above 14%", "global_span": [ 14346, 14355 ] }, { "id": 91, "label": "Value", "start_offset": 958, "end_offset": 979, "text": "over 100 basis points", "global_span": [ 14372, 14393 ] }, { "id": 92, "label": "Value", "start_offset": 1043, "end_offset": 1046, "text": "200", "global_span": [ 14457, 14460 ] }, { "id": 93, "label": "Traditional", "start_offset": 1047, "end_offset": 1054, "text": "in S&P.", "global_span": [ 14461, 14468 ] }, { "id": 94, "label": "Value", "start_offset": 1102, "end_offset": 1110, "text": "above 14", "global_span": [ 14516, 14524 ] }, { "id": 161, "label": "Traditional", "text": "EPS chart", "start_offset": 41, "end_offset": 50, "global_span": [ 13455, 13464 ] }, { "id": 162, "label": "Traditional", "text": "above Moody 's downgrade threshold", "start_offset": 999, "end_offset": 1033, "global_span": [ 14413, 14447 ] } ], "relations": [ { "id": 35, "entity_ids": [ 84, 161 ], "description": "Value_of" }, { "id": 36, "entity_ids": [ 85, 86 ], "description": "Value_of" }, { "id": 37, "entity_ids": [ 87, 88 ], "description": "Value_of" }, { "id": 38, "entity_ids": [ 87, 89, 90 ], "description": "Value_of" }, { "id": 39, "entity_ids": [ 91, 162 ], "description": "Value_of" }, { "id": 40, "entity_ids": [ 92, 93 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Shar Pourreza: Okay. Perfect. That 's what I was trying to get at. So there will be a point in time when we can be a little bit more specific on the range that you target over the long term. What I was trying to really get to.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Brian Savoy: That 's correct.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Shar Pourreza: Okay. Great. And then just on the load growth, obviously, everyone is focused on, you know, the incremental load growth opportunities from hyperscalers, etcetera. The DeepSeq can stargate stuff has been out there for a few weeks now. Just any change in tone, Lynn and Harry, from your customers and your conversations as we 're thinking about spending needs, speed to market, etcetera? Or is it kind of full speed ahead? No pun intended, though.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Harry Sideris: Yeah. I 'll take that with you. Yeah. We feel very confident in our plan that we shared with you. And we have a wealth of opportunities. And our discussions with the hyperscalers, they anticipated efficiency gains, so DeepSeq was not a surprise to them. They 're full speed ahead. They 're looking at the fact that these efficiencies may actually increase the demand for AI. So we have not seen any pullback in anything they 're planning on. In fact, we ' ve seen a lot more discussions with accelerating some of their work. And speed, as you mentioned, is very important to them. And it 's something that we pride ourselves on in working innovatively on solutions with them to find ways to bring them on quicker, which is what they want. So we 'll continue to work with them, but we 're not seeing any pullback. In fact, an acceleration in what they 're discussing with us.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "Lynn Good: Make sure the only thing I ' m helpful. And then, yep. A little delay. Sorry. You know, Harry, you might talk about what we see in the near - term pipeline. There 's a lot of the data centers that are really focused on cloud computing.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Harry Sideris: Yeah. That 's a good point, Lynn. The near - term data centers that we 're having under construction are really associated with cloud computing and expansion there. And then as we move later into the plan, that 's where some of the generative AI data centers are coming in, and that 's when we see the larger load growth.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "Shar Pourreza: Perfect. And thanks, guys, so much. And Harry and Lynn, a big congrats on both your phase twos. And Lynn, I know we 're gon na miss you a lot. It 's been over 20 years of earnings calls, but it 's gon na be fun watching you take over the board. So thank you much.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Operator: We now turn to Julien Dumoulin - Smith with Jefferies. Your line is open. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Brian Savoy: Good morning, Julien. There?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "Operator: We now move on to Nicholas Campanella with Barclays. Your line is open. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Nicholas Campanella: Hey. Good morning, everyone. And I 'll echo Shar 's comments. Congrats to Lynn. I counted the earnings calls. It 's over 80. So but, yeah, congrats on all of that.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Lynn Good: Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Nicholas Campanella: But, hey. Just in the equity that you outlined for this new plan, you know, if you were to do kind of junior sub or hybrid, or any type of, like, equity content - like instrument, does that change the equity means, or do you just kind of remain do you expect it to kind of remain constant through the plan?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Brian Savoy: You know, Nick, I would just frame the equity a little bit. You know, the equity funding in the context of a company our size is around 1%, 1.5% of the market cap, what we need on an annual basis. And, you know, you would expect us to look for the most cost - effective shareholder - friendly solutions to fund that equity as we look through the plan, and we 're planning on using the ATM and the DRIP. But hybrids have continued to be attractive in the market, and you would expect us to look at this and we will.", "ground_truth_output": { "entities": [ { "id": 95, "label": "Traditional", "start_offset": 90, "end_offset": 104, "text": "equity funding", "global_span": [ 17930, 17944 ] }, { "id": 96, "label": "Value", "start_offset": 152, "end_offset": 160, "text": "1%, 1.5%", "global_span": [ 17992, 18000 ] }, { "id": 97, "label": "Traditional", "start_offset": 161, "end_offset": 178, "text": "of the market cap", "global_span": [ 18001, 18018 ] } ], "relations": [ { "id": 41, "entity_ids": [ 95, 96, 97 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Nicholas Campanella: Thanks. And, yeah, definitely appreciate in contact with the market cap smaller. So another question just legislation in South Carolina has been a discussion point for many investors, and just curious I assume none of that 's kind of your plan at this point. If you can maybe detail how it would impact the plan. You know, are you under - earning in South Carolina? Could legislation in any way change your ability to execute differently on the resource plans you ' ve put out there?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Harry Sideris: Yeah. Yeah. Nick, this is Harry. I 'll take that one. You know, we 're always pleased to take part in energy policy discussions at our states and South Carolina is no different. This is something that has been going on since last year and is making progress. It 's really more tone - setting around support for the dual state system that we operate, regulatory timelines, as well as the all - of - the - above strategy and support for that. So we do n't anticipate changes to our plans from the legislation, but it will make the tone in South Carolina stronger for us, and we support that and continue to work with our policymakers on that front.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 27, "sub_chunk_id": 0, "sentences": "Nicholas Campanella: Alright. Thanks a lot. See you soon.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 28, "sub_chunk_id": 0, "sentences": "Lynn Good: Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 29, "sub_chunk_id": 0, "sentences": "Operator: We now turn to David Arcaro with Morgan Stanley. Your line is open. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 30, "sub_chunk_id": 0, "sentences": "David Arcaro: Oh, hey. Thanks. Good morning. And, Lynn, best wishes with your upcoming retirement. And congratulations, Harry.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 31, "sub_chunk_id": 0, "sentences": "Lynn Good: Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 32, "sub_chunk_id": 0, "sentences": "David Arcaro: Let me see. You know, hey, Brian. Just to put you on the spot, we 're gon na see like, is the top end possible in 2027? Specifically? Or how are you thinking about it? Just do it within the specifics of the five - year plan here?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 33, "sub_chunk_id": 0, "sentences": "Brian Savoy: You know, David, we 're not gon na get that specific on the day, but we do see load growth stepping up in 2027 and that 's in our slides and that 's when a lot of these economic development projects that are under construction now will start taking energy and will start serving them. So, you know, that 's the year where we do see this kind of ratcheting and up of growth on the top line, and it does present the opportunity.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 34, "sub_chunk_id": 0, "sentences": "David Arcaro: Yeah. Okay. Great. Now that 's helpful. I appreciate you 're not getting overly precise here with it. But and then could you speak to just how much of a pipeline of data center activity that you 're kind of seeing and working on in the background? It sounds like a lot of the growth is even beyond data centers. That you 're seeing crystallized in the state, which is great to see. And just curious just the quantum of data center activity that 's back there on pipeline.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 35, "sub_chunk_id": 0, "sentences": "Harry Sideris: Yeah, David. We have a wealth of opportunity and not just data centers, but total economic development. We have advanced manufacturing, pharmaceuticals, a very diverse pipeline. Our near - term pipeline in advanced stage pipeline is over seven gigawatts. And our broader pipeline is at least double that and continues to grow. As Brian mentioned, we take a risk - based approach in what we put in our load forecast because we know these loads can move around and the timing of them. So we 're really putting in the load forecast items that are either turning dirt or have letter agreements or near letter agreements. And we continue to work with the ones in the pipeline to bring them forward and get them in the load forecast. So we feel very strongly about our positioning for economic development and future growth, not just in data centers, but in other economic development projects.", "ground_truth_output": { "entities": [ { "id": 98, "label": "Non_Traditional", "start_offset": 198, "end_offset": 202, "text": "near", "global_span": [ 21235, 21239 ] }, { "id": 99, "label": "Non_Traditional", "start_offset": 205, "end_offset": 218, "text": "term pipeline", "global_span": [ 21242, 21255 ] }, { "id": 100, "label": "Non_Traditional", "start_offset": 222, "end_offset": 245, "text": "advanced stage pipeline", "global_span": [ 21259, 21282 ] }, { "id": 101, "label": "Value", "start_offset": 249, "end_offset": 269, "text": "over seven gigawatts", "global_span": [ 21286, 21306 ] } ], "relations": [ { "id": 42, "entity_ids": [ 98, 99, 100, 101 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 36, "sub_chunk_id": 0, "sentences": "David Arcaro: Yep. Excellent. Now that 's helpful. I appreciate the color. And I was just you know, is it possible that there could be even more you know, upside, I guess, based on the pace of the development that you 're seeing in your service territory. I know you ' ve put, obviously, a lot of thought into this updated load growth. And, of course, probability weighted it here. But in terms of the pace of or the rate of change that you 're seeing, is there potential for further upside? Overtime.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 37, "sub_chunk_id": 0, "sentences": "Harry Sideris: David, we 're definitely confident in the plan that we shared with you, and we continue to work to bring as much additional load that we can and we focus on making sure that we can serve that load reliably and affordably. Like I mentioned earlier, the speed is important. So how can we speed this up? We continue to have those discussions with the hyperscalers as well as the advanced manufacturing and other economic development folks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 38, "sub_chunk_id": 0, "sentences": "Lynn Good: David, I would say as we look at the pipeline over the last year, it has continued to increase. And if we look out to 2029, for example, 50% of the pipeline is now data centers. I do think the hard work of the team and bringing customers to our service territory will not stop and we 'll keep you updated along the way on how that translates into growth.", "ground_truth_output": { "entities": [ { "id": 102, "label": "Value", "start_offset": 149, "end_offset": 152, "text": "50%", "global_span": [ 23044, 23047 ] }, { "id": 103, "label": "Non_Traditional", "start_offset": 172, "end_offset": 188, "text": "now data centers", "global_span": [ 23067, 23083 ] } ], "relations": [ { "id": 43, "entity_ids": [ 102, 103 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 39, "sub_chunk_id": 0, "sentences": "David Arcaro: Okay. Great. Very helpful. Thanks so much for the color.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 40, "sub_chunk_id": 0, "sentences": "Harry Sideris: Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 41, "sub_chunk_id": 0, "sentences": "Operator: We now return to Julien Dumoulin - Smith with Jefferies. Your line is open. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 42, "sub_chunk_id": 0, "sentences": "Julien Dumoulin - Smith: Hey. Good morning, team. Can you guys revisit that?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 43, "sub_chunk_id": 0, "sentences": "David Arcaro: Good morning. Hey.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 44, "sub_chunk_id": 0, "sentences": "Julien Dumoulin - Smith: Excellent. Awesome. Hey. Good morning. Congratulations to both of you guys. Nicely done and Lynn. All the best. It 's been a pleasure over the year. Thank you. Indeed. Thank you. Bye.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 45, "sub_chunk_id": 0, "sentences": "David Arcaro: As I said. Absolutely. Look. Maybe just shifting the conversation focus slightly. Can we talk a little bit about cost savings? Just the ability to drive more efficiencies out of the organization. It seems like a potential meaningful year ahead here as you think about the opportunity. Again, maybe a question more for Harry if anyone. How do you think about the scale of what you deliver here, especially against the backdrop of what seems like a reinflationary cycle from a variety of different factors and how that makes you guys relatively competitive. I appreciate your rates remain competitive against a number of different peers and metrics. But how do you think about that contributing to the backdrop of economic development in that 3% to 4% as well?", "ground_truth_output": { "entities": [ { "id": 104, "label": "Traditional", "start_offset": 715, "end_offset": 723, "text": "backdrop", "global_span": [ 24495, 24503 ] }, { "id": 105, "label": "Traditional", "start_offset": 727, "end_offset": 747, "text": "economic development", "global_span": [ 24507, 24527 ] }, { "id": 106, "label": "Value", "start_offset": 756, "end_offset": 764, "text": "3% to 4%", "global_span": [ 24536, 24544 ] } ], "relations": [ { "id": 44, "entity_ids": [ 104, 105, 106 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 46, "sub_chunk_id": 0, "sentences": "Brian Savoy: Hey, Julien. It 's Brian. I ' m gon na start and Harry 's gon na come back and add some additional color. But, you know, we ' ve been a cost leader in the industry. And over the past many years, leveraging technology, including AI, process improvement, and our scale to drive our costs to where they are, and you 're recognizing that, and thank you for that. I will say as our asset base grows to serve a larger customer base, O&M is gon na increase. We will continue our continuous improvements efforts to keep those increases much smaller than the additional customers we 're serving or the revenue that comes with them. But over the time, as we add increase our assets, you do see some slight increase in O&M and I suspect that your whole industry is gon na see it. And we do n't believe our position as a cost leader is gon na change. And we 're gon na manage this very tightly. But, you know, the long - term planning assumption we have is around the 1% CAGR on O&M growth, and that 's, again, much less than the assets and customers we 're adding.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 47, "sub_chunk_id": 0, "sentences": "Harry Sideris: And I would add, Julien, we have a strong continuous improvement culture. It 's really in our DNA to find better ways to do things each and every day. Then our size and scale helps us negotiate better deals with our supply chain partners, as well as a lot of improvement that we made using technology on our planning to make sure that we have long - term plans and locked up resources and materials to implement our growth strategy. So that helps us manage our costs. And we 're taking a programmatic approach to some of the generation build that we 're doing. That 's really saving us a lot of money and really allowing us to have definitive ways to implement this in an efficient and dependable manner. So we 'll continue to do that. Brian mentioned technology, and we talk about AI a lot of times on the load side. But that 's another opportunity for us to continue to leverage those tools to make us more efficient in the future. Awesome. Alright. Excellent.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 48, "sub_chunk_id": 0, "sentences": "Julien Dumoulin - Smith: And then if yeah. I thought we 're gon na talk a little bit more about the consolidation within the utilities here. If I could maybe press you guys a little bit further on that, but related if I can, I 'd also love to hear a little bit about customer deposits and how you think about that impacting rate base and, you know, starting point and cumulative rate base. Certainly, we ' ve seen that with some of your peers of late. As load is ramping. Is that a factor here that we should be thinking about, especially as you say think about the relative increase in rate base versus the CapEx?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 49, "sub_chunk_id": 0, "sentences": "Lynn Good: Hey, Julien. Let me jump in. You may be talking about some of the creative tariff structures for the large load. And I would think of that as being a little bit of noise for us given the scale of the company. So the rate base numbers that we 're sharing with you have a high degree of confidence in the amount of capital that 's actually gon na be deployed in our rate structure. And I think the team has done an extraordinary job developing creative tariff structures to attract large load in a way that protects our residential customers, our low - income customers, but also makes our state attractive for economic development.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 50, "sub_chunk_id": 0, "sentences": "Julien Dumoulin - Smith: Awesome. Yeah. I was thinking the 7.7% CAGR versus the 7.2% that you guys had previously. I would have thought maybe the translation of the, you know, from the between the $84 billion and $73 billion would have been a little bit higher is what I was getting at. Earlier if there were any offsets with it between the CapEx to rate - based translation.", "ground_truth_output": { "entities": [ { "id": 107, "label": "Value", "start_offset": 60, "end_offset": 64, "text": "7.7%", "global_span": [ 27921, 27925 ] }, { "id": 108, "label": "Traditional", "start_offset": 65, "end_offset": 69, "text": "CAGR", "global_span": [ 27926, 27930 ] }, { "id": 109, "label": "Value", "start_offset": 81, "end_offset": 85, "text": "7.2%", "global_span": [ 27942, 27946 ] }, { "id": 110, "label": "Value", "start_offset": 198, "end_offset": 209, "text": "$84 billion", "global_span": [ 28059, 28070 ] }, { "id": 111, "label": "Value", "start_offset": 214, "end_offset": 225, "text": "$73 billion", "global_span": [ 28075, 28086 ] }, { "id": 112, "label": "Traditional", "start_offset": 342, "end_offset": 347, "text": "CapEx", "global_span": [ 28203, 28208 ] }, { "id": 113, "label": "Traditional", "start_offset": 351, "end_offset": 355, "text": "rate", "global_span": [ 28212, 28216 ] }, { "id": 114, "label": "Traditional", "start_offset": 358, "end_offset": 363, "text": "based", "global_span": [ 28219, 28224 ] } ], "relations": [ { "id": 45, "entity_ids": [ 107, 108 ], "description": "Value_of" }, { "id": 46, "entity_ids": [ 108, 109 ], "description": "Value_of" }, { "id": 47, "entity_ids": [ 108, 110, 111 ], "description": "Value_of" }, { "id": 48, "entity_ids": [ 112, 113, 114 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 51, "sub_chunk_id": 0, "sentences": "Lynn Good: I think we can go through more. No. Take it offline. But yeah, Julien, I would say to you, 12% rate base growth is incredibly strong. And is a great underpinning of what we see all that capital has been put through our regulatory processes. We have integrated resource plans in place, etcetera. And I would say to you that if I were to call the operators around the table, they 'd like even more capital. Because the opportunities that we see to invest in our business are just really strong. So we 'll keep going. And delivering the returns that go with it.", "ground_truth_output": { "entities": [ { "id": 115, "label": "Value", "start_offset": 103, "end_offset": 106, "text": "12%", "global_span": [ 28340, 28343 ] }, { "id": 116, "label": "Traditional", "start_offset": 107, "end_offset": 123, "text": "rate base growth", "global_span": [ 28344, 28360 ] } ], "relations": [ { "id": 49, "entity_ids": [ 115, 116 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 52, "sub_chunk_id": 0, "sentences": "Julien Dumoulin - Smith: Alright, guys. Thank you very much. Best of luck again.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 53, "sub_chunk_id": 0, "sentences": "Lynn Good: Thank you. Elliot, are you still there?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 54, "sub_chunk_id": 0, "sentences": "Operator: Ladies and gentlemen, sorry for the technical difficulties. We 'll now turn to Jeremy Tonet with JPMorgan. Your line is open. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 55, "sub_chunk_id": 0, "sentences": "Jeremy Tonet: Hi. Good morning.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 56, "sub_chunk_id": 0, "sentences": "Lynn Good: Morning. Morning.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 57, "sub_chunk_id": 0, "sentences": "Jeremy Tonet: Lynn, best of luck going forward. Harry, congratulations.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 58, "sub_chunk_id": 0, "sentences": "Harry Sideris: Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 59, "sub_chunk_id": 0, "sentences": "Jeremy Tonet: Which we just wondering if you could dig in a little bit more, I guess, on what you 're seeing economic activity clearly in the Carolinas, a lot of good things happening there, but we ' ve heard other care utilities talk about, you know, improvements in the Midwest as well. And just wondering if you could touch on what you see in those areas in your footprint.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 60, "sub_chunk_id": 0, "sentences": "Harry Sideris: Yeah, Jeremy. I 'll take that. In Indiana, we 're seeing strong growth as well. The main focus that we ' ve seen in our territories around advanced manufacturing and facilities manufacturing facilities expanding. We do have some data centers coming into the pipeline there, but not to the level that others are seeing in Indiana. That we 're seeing in the Carolinas, but we continue to have discussions with them and have plans to bring as much economic development into Indiana as we can. It 's a very constructive state. They do a great job of attracting industries. And have a very business - friendly environment, and we work side by side with them to advance that.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 61, "sub_chunk_id": 0, "sentences": "Jeremy Tonet: Got it. Thank you for that. And just wondering with the change in administration in DC, if that impacts, I guess, your thought process at all granted you 're making very long - term decisions and four - year terms are n't ways to really run the ship. But just curious if there 's anything out of DC, you know, particularly as it relates to, I guess, NewQ at this point. Seems like there 's some maybe improving momentum with regards to mutual initiatives across the country.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 62, "sub_chunk_id": 0, "sentences": "Lynn Good: Jeremy, thanks for that question. And I would say that, you know, as we think about the strategy of Duke Energy, it is a strategy that has been built to really serve customers for decades. And as we look at this particular administration, we have shared aspirations with our federal administration, but frankly with our states as well. To ensure that we keep delivering reliable power at low cost and that we deploy generation and embrace this growth and economic development that our states are seeing in a way that demonstrates, you know, good speed to meet what the market requires, but also does it in a way that continues to underpin economic growth going forward. So that framework and that strategy that we 're pursuing, we think, is a strong underpinning both at the federal level and the state level. And if I were to talk about nuclear in particular, we ' ve been we 're a strong nuclear operator. We are pursuing how nuclear can be a part of our all - of - the - above strategies as we get into the 2030s and beyond. You likely saw that we joined a consortium with TVA and others around a DOE grant. We think continuing to learn more on these technologies is important so that when we 're ready to deploy, we have a high degree of confidence that there is a supply chain and engineering design constructors ready to go so that we can produce and operate these new technologies in a way that makes sense for customers. So we are deeply engaged in the state level and the federal level, and a lot of opportunity to support growth across the US.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 63, "sub_chunk_id": 0, "sentences": "Jeremy Tonet: Got it. That 's helpful. Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 64, "sub_chunk_id": 0, "sentences": "Lynn Good: Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 65, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Anthony Crowdell with Mizuho. Your line is open. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 66, "sub_chunk_id": 0, "sentences": "Anthony Crowdell: Good morning. Congrats, Lynn. Congrats, Harry. Unfortunately, my question is for Brian, so you guys have a little break here.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 67, "sub_chunk_id": 0, "sentences": "Brian Savoy: It may be the same question. I guess one is in and I wanna part you know, I ' m not looking to hold you down. I know you addressed a little bit with Shar. On slide eleven, you talk about FFO to debt to improve above 14% over the five - year plan. What 's a reasonable cushion to assume that that like, you would improve by. And the second question is more so as you ' ve talked about in the back end of the plan, you tend you expect to be towards the high end of the 5% to 7% earnings growth. How do you think about the income statement you know, maybe we raise the earnings growth rate or we work on improving the balance sheet maybe to the upgrade trigger. I and it may be the same question, so I 'll leave it there.", "ground_truth_output": { "entities": [ { "id": 117, "label": "Traditional", "start_offset": 201, "end_offset": 212, "text": "FFO to debt", "global_span": [ 32892, 32903 ] }, { "id": 118, "label": "Value", "start_offset": 224, "end_offset": 233, "text": "above 14%", "global_span": [ 32915, 32924 ] }, { "id": 119, "label": "Traditional", "start_offset": 234, "end_offset": 247, "text": "over the five", "global_span": [ 32925, 32938 ] }, { "id": 120, "label": "Traditional", "start_offset": 250, "end_offset": 259, "text": "year plan", "global_span": [ 32941, 32950 ] }, { "id": 121, "label": "Value", "start_offset": 481, "end_offset": 489, "text": "5% to 7%", "global_span": [ 33172, 33180 ] }, { "id": 122, "label": "Traditional", "start_offset": 490, "end_offset": 505, "text": "earnings growth", "global_span": [ 33181, 33196 ] } ], "relations": [ { "id": 50, "entity_ids": [ 117, 118, 119, 120 ], "description": "Value_of" }, { "id": 51, "entity_ids": [ 121, 122 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 68, "sub_chunk_id": 0, "sentences": "Brian Savoy: Thanks, Anthony. And you know, as we think about our FFO to debt and the size of and scale of Duke Energy, I firmly believe 100 basis points of cushion from the Moody 's downgrade threshold gives us flexibility to execute our plans with confidence and to deal with uncertainties that come our way. And we ' ve proven that over the past several years. The rating agencies have been tremendously positive towards us, and the regulatory outcomes that we ' ve been able to work with our regulators on have provided that operating cash flow that the rating agencies are looking for and that consistency of top - line revenues that support a credit profile of ours. So I would start with that. So, you know, the 14% is a solid number for Duke Energy given the size and scale and diversity we have and the rating agencies have been very supportive of us. Every step of the way. As we look through time, operating cash flow does accelerate. We 're making more investment. Those investments are turning into top - line revenues. And we see the 14% improving. Again, I ' m gon na provide more details as the plan progresses, but we feel very good that where we sit and how we see the five years playing out in front of us. And, you know, on the earnings question, I would just say that load growth in 2027, 2028, 2029 is a step change for us. It moves up from the 1.5% to 2% we 're seeing in 2025 and 2026 to a 3% to 4% across the enterprise. And that 's a substantial step up and it gives us clearly the opportunity to earn in the top half.", "ground_truth_output": { "entities": [ { "id": 123, "label": "Traditional", "start_offset": 67, "end_offset": 78, "text": "FFO to debt", "global_span": [ 33490, 33501 ] }, { "id": 124, "label": "Value", "start_offset": 138, "end_offset": 154, "text": "100 basis points", "global_span": [ 33561, 33577 ] }, { "id": 125, "label": "Traditional", "start_offset": 158, "end_offset": 165, "text": "cushion", "global_span": [ 33581, 33588 ] }, { "id": 126, "label": "Traditional", "start_offset": 175, "end_offset": 180, "text": "Moody", "global_span": [ 33598, 33603 ] }, { "id": 127, "label": "Traditional", "start_offset": 184, "end_offset": 203, "text": "downgrade threshold", "global_span": [ 33607, 33626 ] }, { "id": 128, "label": "Value", "start_offset": 720, "end_offset": 723, "text": "14%", "global_span": [ 34143, 34146 ] }, { "id": 129, "label": "Traditional", "start_offset": 910, "end_offset": 929, "text": "operating cash flow", "global_span": [ 34333, 34352 ] }, { "id": 130, "label": "Value", "start_offset": 935, "end_offset": 945, "text": "accelerate", "global_span": [ 34358, 34368 ] }, { "id": 131, "label": "Value", "start_offset": 1049, "end_offset": 1052, "text": "14%", "global_span": [ 34472, 34475 ] }, { "id": 132, "label": "Traditional", "start_offset": 1290, "end_offset": 1301, "text": "load growth", "global_span": [ 34713, 34724 ] }, { "id": 133, "label": "Traditional", "start_offset": 1305, "end_offset": 1309, "text": "2027", "global_span": [ 34728, 34732 ] }, { "id": 134, "label": "Traditional", "start_offset": 1311, "end_offset": 1315, "text": "2028", "global_span": [ 34734, 34738 ] }, { "id": 135, "label": "Traditional", "start_offset": 1317, "end_offset": 1321, "text": "2029", "global_span": [ 34740, 34744 ] }, { "id": 136, "label": "Value", "start_offset": 1368, "end_offset": 1378, "text": "1.5% to 2%", "global_span": [ 34791, 34801 ] }, { "id": 137, "label": "Traditional", "start_offset": 1396, "end_offset": 1400, "text": "2025", "global_span": [ 34819, 34823 ] }, { "id": 138, "label": "Traditional", "start_offset": 1405, "end_offset": 1409, "text": "2026", "global_span": [ 34828, 34832 ] }, { "id": 139, "label": "Value", "start_offset": 1415, "end_offset": 1417, "text": "3%", "global_span": [ 34838, 34840 ] }, { "id": 140, "label": "Value", "start_offset": 1421, "end_offset": 1423, "text": "4%", "global_span": [ 34844, 34846 ] } ], "relations": [ { "id": 52, "entity_ids": [ 123, 124, 125, 126, 127 ], "description": "Value_of" }, { "id": 53, "entity_ids": [ 129, 130 ], "description": "Value_of" }, { "id": 54, "entity_ids": [ 132, 133, 134, 135 ], "description": "Value_of" }, { "id": 55, "entity_ids": [ 136, 137 ], "description": "Value_of" }, { "id": 56, "entity_ids": [ 138, 139, 140 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 69, "sub_chunk_id": 0, "sentences": "Anthony Crowdell: Great. Thanks so much for taking the questions.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 70, "sub_chunk_id": 0, "sentences": "Brian Savoy: Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 71, "sub_chunk_id": 0, "sentences": "Operator: Our final question today comes from Durgesh Chopra with Evercore ISI. Your line is open. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 72, "sub_chunk_id": 0, "sentences": "Durgesh Chopra: Hey, team. Good morning. Thank you for giving me time and and called you know, the congratulations for Lynn and Harry. The best to you both. Thank you. Hey. Just suddenly, Brian, sorry. I 'll apologize in advance because this is an annoying question. But when I think about 2025 guidance and I compare it to the 2024 original guidance midpoint, it 's a 5% EPS growth. And, obviously, the 2025 guidance was lowered because of hurricane and one - time stuff. I ' m just wondering, are you being conservative as it relates to 2026? Or are there other headwinds like interest rates, that is causing you to be at the low end versus the original 2025? Any color you could share there?", "ground_truth_output": { "entities": [ { "id": 141, "label": "Traditional", "start_offset": 291, "end_offset": 304, "text": "2025 guidance", "global_span": [ 35465, 35478 ] }, { "id": 142, "label": "Traditional", "start_offset": 329, "end_offset": 360, "text": "2024 original guidance midpoint", "global_span": [ 35503, 35534 ] }, { "id": 143, "label": "Value", "start_offset": 370, "end_offset": 383, "text": "5% EPS growth", "global_span": [ 35544, 35557 ] } ], "relations": [ { "id": 57, "entity_ids": [ 141, 142, 143 ], "description": "Value_of" } ] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 73, "sub_chunk_id": 0, "sentences": "Brian Savoy: And, Durgesh, I would start with the $6.30 is firmly within our 5% to 7%. As we ' ve looked at our plan, we feel like it is the right level for us. But you 'll see one item I 'd point to in our electric walk - up. On the earnings. We have O&M increasing. And that is due to two things. One, we had resources focused on the storm from the second half of the year. Right? So we did n't do some grid projects or some generation outages that we had planned. Those are gon na be caught up in 2025. So we have some shifts in O&M from that. And we also set aside some O&M resources for additional storm costs because we ' ve seen a more frequent set of storms impact our regions. And if you wanted to point to one thing, I would say that 's a timing shift that 's showing up in 2025 that you might not have had in your model, but other than that, we feel like the $6.30 is right in line with where we need to be we have a high degree of confidence in achieving.", "ground_truth_output": { "entities": [ { "id": 144, "label": "Value", "start_offset": 53, "end_offset": 58, "text": "$6.30", "global_span": [ 35923, 35928 ] }, { "id": 145, "label": "Value", "start_offset": 80, "end_offset": 88, "text": "5% to 7%", "global_span": [ 35950, 35958 ] }, { "id": 146, "label": "Value", "start_offset": 873, "end_offset": 878, "text": "$6.30", "global_span": [ 36743, 36748 ] } ], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 74, "sub_chunk_id": 0, "sentences": "Durgesh Chopra: Got it. It 's just a little bit of O&M catch - up and timing. That 's very helpful. I appreciate that. And then finally, just, you know, shifting gears. Looking at the ROE charts, that you publish annually. Thank you for doing that. The Ohio Kentucky is still considerably below your other subsidiary ROE averages. Just wondering what steps and you have a footnote there, you know, timing of rate case on that. So what steps could you take to kind of get it to 9% plus? Just any thoughts there. Thank you.", "ground_truth_output": { "entities": [ { "id": 147, "label": "Traditional", "start_offset": 307, "end_offset": 330, "text": "subsidiary ROE averages", "global_span": [ 37147, 37170 ] }, { "id": 148, "label": "Traditional", "start_offset": 409, "end_offset": 418, "text": "rate case", "global_span": [ 37249, 37258 ] }, { "id": 149, "label": "Value", "start_offset": 478, "end_offset": 485, "text": "9% plus", "global_span": [ 37318, 37325 ] } ], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 75, "sub_chunk_id": 0, "sentences": "Harry Sideris: Yeah. Thank you for that question, Durgesh. Yeah. We continually look and work in ways with rate cases and other mechanisms on our riders to improve that. And we will continue to focus on that working with our commissioners in the future.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 76, "sub_chunk_id": 0, "sentences": "Durgesh Chopra: Okay. Yeah. Thank you. Be Here you go. Go ahead then. The only thing I would add is there can be some variability in ROE from year to year as we think about whether it 's an outage or we think about other activities that may be going on. I would ask you to evaluate those returns over a longer - term period. And our objective is to earn it or allow rate of return by aggressively pursuing rate cases and cost reductions in a way that position the utilities for success.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 77, "sub_chunk_id": 0, "sentences": "Durgesh Chopra: True. Okay. Yep. Yep. Absolutely. Thank you. Thanks again for the time.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 78, "sub_chunk_id": 0, "sentences": "Harry Sideris: Thank you. Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 79, "sub_chunk_id": 0, "sentences": "Operator: This concludes our Q&A. I 'll now hand back to Lynn Good for any final remarks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 80, "sub_chunk_id": 0, "sentences": "Lynn Good: Well, thank you all. Appreciate the sentiments of congratulations for Harry and for me. But most of all, I appreciate your investment in Duke Energy. We feel like we presented a strong long - term case for growth, for cash flows, and delivering returns for all of you and look forward to continuing that conversation. So thanks again for joining us.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "DUK", "quarter": 4, "year": 2024, "date": "2025-02-13 10:00:00", "chunk_id": 81, "sub_chunk_id": 0, "sentences": "Operator: Ladies and gentlemen, this call is now concluded. We 'd like to thank you for your participation. You may now disconnect your lines.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Operator: Welcome, everyone Thank you for standing by for the Alphabet Second Quarter 2024 Earnings Conference Call At this time, all participants are in a listen - only mode After the speaker presentation, there will be a question - and - answer session [Operator Instructions ] I would now like to hand the conference over to your speaker today, Jim Friedland, Director of Investor Relations Please go ahead", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Jim Friedland: Thank you Good afternoon everyone and welcome to Alphabet 's Second Quarter 2024 Earnings Conference Call With us today are Sundar Pichai, Philipp Schindler, and Ruth Porat Now, I 'll quickly cover the Safe Harbor Some of the statements that we make today regarding our business, operations, and financial performance may be considered forward - looking Such statements are based on current expectations and assumptions that are subject to a number of risks and uncertainties Actual results could differ materially Please refer to our Forms 10 - K and 10 - Q, including the risk factors We undertake no obligation to update any forward - looking statement During this call, we will present both GAAP and non - GAAP financial measures A reconciliation of non - GAAP to GAAP measures is included in today 's earnings press release which is distributed and available to the public through our Investor Relations website located at abc xyz / investor Our comments will be on year - over - year comparisons unless we state otherwise And now I 'll turn the call over to Sundar", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Sundar Pichai: Thank you, Jim And hello, everyone I 'm really pleased with our results this quarter They showed tremendous ongoing momentum in Search and great progress in Cloud with our AI initiatives driving new growth Search had another excellent quarter And in terms of product innovation, we are seeing great progress with AI overviews In Q2, Cloud reached some major milestones Quarterly revenues crossed the $10 billion mark for the first time, at the same time pass the $1 billion mark in quarterly operating profit Year - to - date, our AI infrastructure and generative AI solutions for Cloud customers have already generated billions in revenues and are being used by more than 2 million developers As I spoke about last quarter, we are uniquely well - positioned for the AI opportunity ahead Our Research and Infrastructure leadership means, we can pursue an in - house strategy that enables our product teams to move quickly Combined with our model building expertise, we are in a strong position to control our destiny, as the technology continues to evolve Importantly, we are innovating at every layer of the AI stack, from chips to agents and beyond, a huge strength We are committed to this leadership long - term This was underscored by the announcements we made at I / O, Cloud Next, and Google Marketing Live, and we 'll touch on many of them here Today, I 'll start with Search, then move to our AI momentum more generally, followed by Cloud, YouTube, and some closing thoughts Let 's dive in Over the past 25 years, we have continued to reimagine and expand Google Search across many technological shifts With AI, we are delivering better responses on more types of search queries and introducing new ways to search We are pleased to see the positive trends from our testing continue as we roll out AI overviews, including increases in search usage, and increased user satisfaction with the results People who are looking for help with complex topics are engaging more and keep coming back for AI overviews And we see even higher engagement from younger users, aged 18 to 24, when they use search with AI overviews As we have said, we are continuing to prioritize approaches that send traffic to sites across the web And we are seeing that ads appearing either above or below AI overviews, continue to provide valuable options for people to take action and connect with businesses Beyond AI overviews, AI expands the types of queries we are able to address and opens up powerful new ways to search Visual search via Lens is one Soon you 'll be able to ask questions by taking a video with Lens And already we have seen that AI overviews in Lens, leads to an increase in overall visual search usage Another example is Circle to Search, which is available today on more than 100 million Android devices We are seeing tremendous momentum from our AI investments More than 1.5 million developers are now using Gemini across our developer tools And we recently unveiled new models that are more capable and efficient than ever Gemini now comes in 4 sizes, with each model designed for its own set of use cases It 's a versatile model family that runs efficiently on everything from data centers to devices At 2 million tokens, we offer the longest context window of any large - scale foundation model to - date, which powers developer use cases that no other model can handle Gemini is making Google 's own products better All six of our products with more than 2 billion monthly users now use Gemini This means that Google is the company that 's truly bringing AI to everyone Gemini is powering incredibly helpful features in search, workspace, Google messages, and more At I / O, we showed new features coming soon to Gmail and to Google Photos Soon you 'll be able to ask photos questions like, what did I eat at that restaurant in Paris last year? For a glimpse of the future, I hope you saw Project Astra at I / O It shows multimodal understanding and natural conversational capabilities We 've always wanted to build a universal agent and it 's an early look at how they can be helpful in daily life Our AI product advances come from our long - standing foundation of research leadership, as well as our global network of infrastructure In Q2, we announced our first data center and cloud region in Malaysia, and expansion projects in Iowa, Virginia, and Ohio Our TPUs are a key bet here, too Trillium is the sixth generation of our custom AI accelerator, and it 's our best performing and most energy efficient TPU to - date It achieves a near 5 times increase in peak compute performance per chip and a 67% more energy efficient compared to TPU v5e And the latest Nvidia Blackwell platform, will be coming to Google Cloud in early 2025 We continue to invest in designing and building robust and efficient infrastructure to support our efforts in AI, given the many opportunities we see ahead Of course, as we do this, we 'll continue to create capacity by allocating resources towards our highest priorities We are relentlessly driving efficiencies in our AI models For example, over the past quarter, we have made quality improvements that include doubling the core model size for AI overviews, while at the same time improving latency and keeping cost per AI overviews served flat And we are focused on matching the right model size to the complexity of the query in order to minimize impact on cost and latency Separately on our real estate investments, we are taking a measured approach to match the current and future needs of our hybrid workforce, as well as our local communities Next, Google Cloud We continue to see strong customer interest, winning leading brands like Hitachi, Motorola Mobility, and KPMG Our deep partnership with Oracle significantly expanded our joint offerings to the large customer base Our momentum begins with our AI infrastructure, which provides AI startups like Essential AI, with leading cost performance for models and high - performance computing applications We continue to drive fundamental differentiation with new advances since Cloud Next This includes Trillium, which I mentioned earlier, and A3 Mega powered by Nvidia H100 GPUs, which doubles the networking bandwidth of A3 Our enterprise AI platform, Vertex, helps customers such as Deutsche Bank, Kingfisher, and the US Air Force build powerful AI agents Last month, we announced a number of new advances Uber and WPP are using Gemini Pro 1.5 and Gemini Flash 1.5 in areas like customer experience and marketing. We broaden support for third - party models, including Anthropic 's Claude 3.5 Sonnet and open source models like Gemma 2, Llama and Mistral We are the only cloud provider to offer grounding with Google Search, and we are expanding grounding capabilities with Moody 's, MSCI, ZoomInfo, and more Our AI - powered applications portfolio is helping us win new customers and drive upsell For example, our conversational AI platform is helping customers like Best Buy and Gordon Food Service Gemini for Workspace helps click therapeutics analyze patient feedback as they build targeted digital treatments Our AI - powered agents are also helping customers develop better quality software, find insights from their data, and protect their organization against cybersecurity threats using Gemini Software engineers at Wipro are using Gemini code assist to develop, test, and document software faster And data analysts at Mercado Libre are using BigQuery and Looker to optimize capacity planning and fulfill shipments faster Cyber security risks continue to accelerate and the number of breaches continue to grow, something we all see in the news every day and that our [Mandiant teams ] (ph) help manage Our strong track record of uptime, quality control and reliability made Google Cloud the trusted security choice for organizations like Fiserv and Marriott International In Q2, we infused AI throughout our security portfolio, helping TELUS strengthen its proactive security posture Turning next to YouTube, YouTube is focused on a clear strategy, connecting creators with a massive audience and enabling them to build successful businesses through ads and subscriptions, while helping advertisers reach their desired audience We had a great brand cast this quarter, and Philip will say more I 'm pleased at the progress here YouTube has remained number one in US Streaming watch time, according to Nielsen Views of YouTube shots on connected TVs more than double last year And we are making it easier for creators to add captions and turn regular videos into shots Next, on Android and Pixel We joined Samsung for their Galaxy Unpacked event a few weeks ago, and we shared that Samsung 's new devices will include the latest AI - powered Google updates on Android It was a great event I 'm looking forward to our Made by Google event happening in August We 'll have lots to share around Android and the Pixel portfolio of devices Our Pixel line is doing well We recently introduced the new Pixel 8a, powered by our latest Google Tensor G3 chip It provides beautiful AI experiences like Circle to Search, Best Take, and a Gemini - powered AI assistant In other bets, I 'm really pleased with the progress Waymo 's making, a real leader in the space and getting rave reviews from users Waymo 's served more than 2 million trips to - date and driven more than 20 million fully autonomous miles on public roads Waymo 's now delivering well over 50, 000 weekly paid public rides, primarily in San Francisco and Phoenix And in June, we removed the waitlist in San Francisco, so anyone can take a ride Fully autonomous testing is underway in other Bay Area locations without a human in the driver 's seat Before I close, I want to acknowledge that today is Ruth 's final earnings call Let me take a moment to thank her for all she has done for Google and Alphabet as our longest - serving CFO I 'm excited to continue to work with her in her new role And I look forward to welcoming our newly appointed CFO, Anat Ashkenazi She starts next week, and you 'll hear from her on our call next quarter Thanks as always to our employees and partners everywhere for a great Q2 With that, over to you, Philip", "ground_truth_output": { "entities": [ { "id": 0, "label": "Traditional", "start_offset": 399, "end_offset": 417, "text": "Quarterly revenues", "global_span": [ 1928, 1946 ] }, { "id": 1, "label": "Value", "start_offset": 430, "end_offset": 441, "text": "$10 billion", "global_span": [ 1959, 1970 ] }, { "id": 2, "label": "Value", "start_offset": 493, "end_offset": 503, "text": "$1 billion", "global_span": [ 2022, 2032 ] }, { "id": 3, "label": "Traditional", "start_offset": 512, "end_offset": 538, "text": "quarterly operating profit", "global_span": [ 2041, 2067 ] }, { "id": 4, "label": "Value", "start_offset": 652, "end_offset": 660, "text": "billions", "global_span": [ 2181, 2189 ] }, { "id": 5, "label": "Traditional", "start_offset": 664, "end_offset": 672, "text": "revenues", "global_span": [ 2193, 2201 ] }, { "id": 6, "label": "Value", "start_offset": 705, "end_offset": 706, "text": "2", "global_span": [ 2234, 2235 ] }, { "id": 7, "label": "Non_Traditional", "start_offset": 707, "end_offset": 725, "text": "million developers", "global_span": [ 2236, 2254 ] }, { "id": 8, "label": "Non_Traditional", "start_offset": 2796, "end_offset": 2812, "text": "Circle to Search", "global_span": [ 4325, 4341 ] }, { "id": 9, "label": "Non_Traditional", "start_offset": 2823, "end_offset": 2832, "text": "available", "global_span": [ 4352, 4361 ] }, { "id": 10, "label": "Value", "start_offset": 2852, "end_offset": 2863, "text": "100 million", "global_span": [ 4381, 4392 ] }, { "id": 11, "label": "Value", "start_offset": 2952, "end_offset": 2963, "text": "1.5 million", "global_span": [ 4481, 4492 ] }, { "id": 12, "label": "Non_Traditional", "start_offset": 2964, "end_offset": 2974, "text": "developers", "global_span": [ 4493, 4503 ] }, { "id": 13, "label": "Non_Traditional", "start_offset": 2983, "end_offset": 2995, "text": "using Gemini", "global_span": [ 4512, 4524 ] }, { "id": 14, "label": "Value", "start_offset": 3295, "end_offset": 3304, "text": "2 million", "global_span": [ 4824, 4833 ] }, { "id": 15, "label": "Non_Traditional", "start_offset": 3305, "end_offset": 3311, "text": "tokens", "global_span": [ 4834, 4840 ] }, { "id": 16, "label": "Non_Traditional", "start_offset": 3334, "end_offset": 3348, "text": "context window", "global_span": [ 4863, 4877 ] }, { "id": 17, "label": "Value", "start_offset": 3552, "end_offset": 3561, "text": "2 billion", "global_span": [ 5081, 5090 ] }, { "id": 18, "label": "Non_Traditional", "start_offset": 3562, "end_offset": 3575, "text": "monthly users", "global_span": [ 5091, 5104 ] }, { "id": 19, "label": "Non_Traditional", "start_offset": 3580, "end_offset": 3590, "text": "use Gemini", "global_span": [ 5109, 5119 ] }, { "id": 20, "label": "Value", "start_offset": 4373, "end_offset": 4378, "text": "first", "global_span": [ 5902, 5907 ] }, { "id": 21, "label": "Non_Traditional", "start_offset": 4379, "end_offset": 4419, "text": "data center and cloud region in Malaysia", "global_span": [ 5908, 5948 ] }, { "id": 22, "label": "Non_Traditional", "start_offset": 8595, "end_offset": 8634, "text": "Views of YouTube shots on connected TVs", "global_span": [ 10124, 10163 ] }, { "id": 23, "label": "Value", "start_offset": 8645, "end_offset": 8651, "text": "double", "global_span": [ 10174, 10180 ] }, { "id": 24, "label": "Non_Traditional", "start_offset": 8652, "end_offset": 8661, "text": "last year", "global_span": [ 10181, 10190 ] }, { "id": 25, "label": "Value", "start_offset": 9521, "end_offset": 9522, "text": "2", "global_span": [ 11050, 11051 ] }, { "id": 26, "label": "Non_Traditional", "start_offset": 9523, "end_offset": 9536, "text": "million trips", "global_span": [ 11052, 11065 ] }, { "id": 27, "label": "Value", "start_offset": 9568, "end_offset": 9578, "text": "20 million", "global_span": [ 11097, 11107 ] }, { "id": 28, "label": "Non_Traditional", "start_offset": 9579, "end_offset": 9617, "text": "fully autonomous miles on public roads", "global_span": [ 11108, 11146 ] }, { "id": 29, "label": "Value", "start_offset": 9654, "end_offset": 9661, "text": "50, 000", "global_span": [ 11183, 11190 ] }, { "id": 30, "label": "Non_Traditional", "start_offset": 9662, "end_offset": 9686, "text": "weekly paid public rides", "global_span": [ 11191, 11215 ] }, { "id": 177, "label": "non_traditional", "text": "Android devices", "start_offset": 2864, "end_offset": 2879, "global_span": [ 4393, 4408 ] }, { "id": 178, "label": "Traditional", "text": "longest ", "start_offset": 3326, "end_offset": 3334, "global_span": [ 4855, 4863 ] }, { "id": 179, "label": "non_traditional", "text": "Waymo ", "start_offset": 9495, "end_offset": 9501, "global_span": [ 11024, 11030 ] } ], "relations": [ { "id": 1, "entity_ids": [ 0, 1 ], "description": "Value_of" }, { "id": 2, "entity_ids": [ 2, 3 ], "description": "Value_of" }, { "id": 3, "entity_ids": [ 4, 5 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 6, 7 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 8, 9, 10, 177 ], "description": "Value_of" }, { "id": 6, "entity_ids": [ 11, 12, 13 ], "description": "Value_of" }, { "id": 7, "entity_ids": [ 14, 15, 16 ], "description": "Value_of" }, { "id": 8, "entity_ids": [ 16, 178 ], "description": "Value_of" }, { "id": 9, "entity_ids": [ 17, 18, 19 ], "description": "Value_of" }, { "id": 10, "entity_ids": [ 20, 21 ], "description": "Value_of" }, { "id": 11, "entity_ids": [ 22, 23, 24 ], "description": "Value_of" }, { "id": 12, "entity_ids": [ 25, 26 ], "description": "Value_of" }, { "id": 13, "entity_ids": [ 25, 26, 179 ], "description": "Value_of" }, { "id": 14, "entity_ids": [ 27, 28 ], "description": "Value_of" }, { "id": 15, "entity_ids": [ 29, 30 ], "description": "Value_of" } ] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Philipp Schindler: Thanks, Sundar, and hello, everyone Starting with performance, Google Services delivered revenues of $73.9 billion for the quarter, up 12% year - on - year Search and other revenues grew 14% year - on - year, led by growth in the retail vertical, followed by financial services YouTube ads revenues were up 13% year - on - year driven by growth and brand as well as direct response Network revenues declined 5% year - on - year In subscriptions, platforms, and devices, year - on - year revenues increased 14%, driven again by strong growth in YouTube subscriptions For the rest of my remarks, I want to double click on two topics First, how we 're applying AI across the marketing process to deliver an even stronger ads experience Second, YouTube 's position as the leading multi - format platform So let me start by sharing some of the ways we are applying AI to bring more performance benefits to even more businesses Q2 brought several major opportunities to meet and learn from users, developers, creators, and customers From I / O to Brandcast, Google Marketing Live and Can, a growing number of our customers and partners are looking to understand how to successfully incorporate AI into their businesses This quarter, we announced over 30 new ads features, and products to help advertisers leverage AI and keep pace with the evolving expectations of customers and users Across Search, PMax, DemandGen, and Retail, we 're applying AI to streamline workflows, enhance creative asset production, and provide more engaging experiences for consumers Listening to our customers, retailers in particular have welcomed AI - powered features to help scale the depth and breadth of their assets For example, as part of a new and easier - to - use merchant center, we 've expanded Product Studio, with tools that bring the power of Google AI to every business owner You can upload a product image from the AI with something like, feature this product with Paris skyline in the background and Product Studio will generate campaign ready assets I also hear great feedback from our customers on many of our other new AI - powered features We 're beta testing, virtual try on and shopping ads and plan to roll it out widely later this year Feedback shows this feature gets 60% more high - quality views than other images and a higher click - out to retailer sites Retailers love it because it drives purchasing decisions and fewer returns Our AI - driven profit optimization tools have been expanded to performance max and standard shopping campaigns Advertisers use profit optimization and smart bidding see a 15% uplift in profit on average compared to revenue - only bidding Lastly, DemandGen is rolling out to Display in Video 360 and Search Ads 360 in the coming months with new generative image tools that create stunning high - quality image assets for social marketers As we said at GML, when paired with Search or PMax, DemandGen delivers an average of 14% more conversions The use cases we 're seeing across the industry show the incredible potential of these AI - enabled products to improve performance Let me briefly share two examples with you Luxury jewelry retailer Tiffany leveraged DemandGen during the holiday season and saw 2 5% brand lift in consideration and actions, such as adding items to cards and booking appointments The campaign drove a 5.6 times more efficient cost per click compared to social media benchmarks Our own Google marketing team used DemandGen to create nearly 4,500 ad variations for a Pixel 8 campaign shown across YouTube, Discover, and Gmail, delivering twice the click - through rate at nearly a quarter of the cost In addition to strengthening our ads products for customers, we continue to evolve our existing systems and products with improved models delivering further performance gains In just six months, AI - driven improvements to quality, relevance, and language understanding have improved Broad Match performance by 10% for advertisers using Smart Bidding Also, advertisers who adopt PMax to Broad Match and Smart Bidding in their Search campaigns, see an average increase of over 25% more conversions or value at a similar cost We 'll continue to listen to our customers and use their feedback to drive innovation across our products As you can hear, I continue to be excited about the AI era for ads Now let 's turn to YouTube I 've talked before about our approach to making YouTube the best place to create, watch and monetize First, the best place to create What sets YouTube apart from every other platform are the creators and the connection they have with their fans Audiences tuning in to watch their favorite creators continue to grow For example, two weeks ago, Mr Beast 's channel hit more than 300 million subscribers Next, the best place to watch Our long - term investment in CTV continues to deliver Views on CTV have increased more than 130% in the last three years According to Nielsen, YouTube is the Number # 1 most watched streaming platform on TV screens in the US for the 17th consecutive month Zooming out, when you look not just at streaming, but at all media companies and their combined TV viewership, YouTube is the second most watched after Disney And this growth is happening in multiple verticals, including sports, which has seen CTV watch time on YouTube grow 30% year - over - year Lastly, the best place to monetize CTV on YouTube is continuing to benefit from a combination of strong watch time growth, viewer and advertiser innovation and a shift in brand advertising budgets from linear TV to YouTube Our largest advertisers across verticals, including retail, entertainment, telco and home and personal care, are partnering with creators on ads and organic integrations Verizon, for example, worked with a YouTube creator and Verizon customer to show them many ways that plans and offerings can be customized to fit people ’s lives Using AI - powered formats, they created sketches in multiple lengths and orientations to serve the right creative to the right viewer and drive people to their site Verizon 's creator ads had a 15% lower CPA and a 38% higher conversion rate versus other ads Turning to Shorts Last quarter, I shared that in the US, the monetization rate of YouTube Shorts relative to in - stream viewing is showing a healthy rate of growth Again, this quarter, we continue to see an improvement in Shorts monetization, particularly in the US We are also seeing a very encouraging contribution from brand advertising on Shorts, which we launched on the product in Q4 last year Lastly, a few words on shopping Last year, viewers watched 30 billion hours of shopping - related videos, and we saw a 25% increase in watch time for videos that help people shop While it is early days, shopping remains a key area of investment At GML, we rolled out several product updates to YouTube shopping, helping creators sell products to their viewers These updates included; product tagging where creators can tag products in their videos for viewers to discover and purchase, product collections and a new affiliate hub, a one - stop shop for creators to find deals and promotional offers from brands and track their affiliate earnings With that, I 'll finish by saying a huge thank you to Google 's everywhere for their extraordinary commitment and to our customers and partners for their continued collaboration and trust And Ruth, thanks for your amazing leadership and partnership over all these years Now for one last time, it 's over to you", "ground_truth_output": { "entities": [ { "id": 31, "label": "Traditional", "start_offset": 111, "end_offset": 119, "text": "revenues", "global_span": [ 12063, 12071 ] }, { "id": 32, "label": "Value", "start_offset": 123, "end_offset": 136, "text": "$73.9 billion", "global_span": [ 12075, 12088 ] }, { "id": 33, "label": "Value", "start_offset": 157, "end_offset": 160, "text": "12%", "global_span": [ 12109, 12112 ] }, { "id": 34, "label": "Traditional", "start_offset": 161, "end_offset": 165, "text": "year", "global_span": [ 12113, 12117 ] }, { "id": 35, "label": "Traditional", "start_offset": 180, "end_offset": 205, "text": "Search and other revenues", "global_span": [ 12132, 12157 ] }, { "id": 36, "label": "Value", "start_offset": 211, "end_offset": 214, "text": "14%", "global_span": [ 12163, 12166 ] }, { "id": 37, "label": "Traditional", "start_offset": 215, "end_offset": 219, "text": "year", "global_span": [ 12167, 12171 ] }, { "id": 38, "label": "Traditional", "start_offset": 222, "end_offset": 224, "text": "on", "global_span": [ 12174, 12176 ] }, { "id": 39, "label": "Traditional", "start_offset": 227, "end_offset": 231, "text": "year", "global_span": [ 12179, 12183 ] }, { "id": 40, "label": "Traditional", "start_offset": 304, "end_offset": 324, "text": "YouTube ads revenues", "global_span": [ 12256, 12276 ] }, { "id": 41, "label": "Value", "start_offset": 333, "end_offset": 341, "text": "13% year", "global_span": [ 12285, 12293 ] }, { "id": 42, "label": "Traditional", "start_offset": 344, "end_offset": 346, "text": "on", "global_span": [ 12296, 12298 ] }, { "id": 43, "label": "Traditional", "start_offset": 349, "end_offset": 353, "text": "year", "global_span": [ 12301, 12305 ] }, { "id": 44, "label": "Traditional", "start_offset": 410, "end_offset": 426, "text": "Network revenues", "global_span": [ 12362, 12378 ] }, { "id": 45, "label": "Value", "start_offset": 436, "end_offset": 438, "text": "5%", "global_span": [ 12388, 12390 ] }, { "id": 46, "label": "Traditional", "start_offset": 439, "end_offset": 443, "text": "year", "global_span": [ 12391, 12395 ] }, { "id": 47, "label": "Traditional", "start_offset": 446, "end_offset": 448, "text": "on", "global_span": [ 12398, 12400 ] }, { "id": 48, "label": "Traditional", "start_offset": 451, "end_offset": 455, "text": "year", "global_span": [ 12403, 12407 ] }, { "id": 49, "label": "Traditional", "start_offset": 461, "end_offset": 474, "text": "subscriptions", "global_span": [ 12413, 12426 ] }, { "id": 50, "label": "Traditional", "start_offset": 476, "end_offset": 485, "text": "platforms", "global_span": [ 12428, 12437 ] }, { "id": 51, "label": "Traditional", "start_offset": 491, "end_offset": 498, "text": "devices", "global_span": [ 12443, 12450 ] }, { "id": 52, "label": "Traditional", "start_offset": 500, "end_offset": 504, "text": "year", "global_span": [ 12452, 12456 ] }, { "id": 53, "label": "Traditional", "start_offset": 507, "end_offset": 509, "text": "on", "global_span": [ 12459, 12461 ] }, { "id": 54, "label": "Traditional", "start_offset": 512, "end_offset": 535, "text": "year revenues increased", "global_span": [ 12464, 12487 ] }, { "id": 55, "label": "Value", "start_offset": 536, "end_offset": 539, "text": "14%", "global_span": [ 12488, 12491 ] }, { "id": 56, "label": "Value", "start_offset": 2669, "end_offset": 2672, "text": "15%", "global_span": [ 14621, 14624 ] }, { "id": 57, "label": "Traditional", "start_offset": 2683, "end_offset": 2689, "text": "profit", "global_span": [ 14635, 14641 ] }, { "id": 58, "label": "Value", "start_offset": 3024, "end_offset": 3027, "text": "14%", "global_span": [ 14976, 14979 ] }, { "id": 59, "label": "Non_Traditional", "start_offset": 3028, "end_offset": 3044, "text": "more conversions", "global_span": [ 14980, 14996 ] }, { "id": 60, "label": "Non_Traditional", "start_offset": 4015, "end_offset": 4050, "text": "improved Broad Match performance by", "global_span": [ 15967, 16002 ] }, { "id": 61, "label": "Value", "start_offset": 4051, "end_offset": 4054, "text": "10%", "global_span": [ 16003, 16006 ] }, { "id": 62, "label": "Non_Traditional", "start_offset": 4168, "end_offset": 4184, "text": "Search campaigns", "global_span": [ 16120, 16136 ] }, { "id": 63, "label": "Value", "start_offset": 4218, "end_offset": 4221, "text": "25%", "global_span": [ 16170, 16173 ] }, { "id": 64, "label": "Non_Traditional", "start_offset": 4222, "end_offset": 4238, "text": "more conversions", "global_span": [ 16174, 16190 ] }, { "id": 65, "label": "Non_Traditional", "start_offset": 4831, "end_offset": 4847, "text": "Beast 's channel", "global_span": [ 16783, 16799 ] }, { "id": 66, "label": "Value", "start_offset": 4862, "end_offset": 4873, "text": "300 million", "global_span": [ 16814, 16825 ] }, { "id": 67, "label": "Non_Traditional", "start_offset": 4874, "end_offset": 4885, "text": "subscribers", "global_span": [ 16826, 16837 ] }, { "id": 68, "label": "Non_Traditional", "start_offset": 4977, "end_offset": 4989, "text": "Views on CTV", "global_span": [ 16929, 16941 ] }, { "id": 69, "label": "Non_Traditional", "start_offset": 4995, "end_offset": 5004, "text": "increased", "global_span": [ 16947, 16956 ] }, { "id": 70, "label": "Value", "start_offset": 5015, "end_offset": 5019, "text": "130%", "global_span": [ 16967, 16971 ] }, { "id": 71, "label": "Non_Traditional", "start_offset": 5027, "end_offset": 5043, "text": "last three years", "global_span": [ 16979, 16995 ] }, { "id": 72, "label": "Value", "start_offset": 5092, "end_offset": 5093, "text": "1", "global_span": [ 17044, 17045 ] }, { "id": 73, "label": "Non_Traditional", "start_offset": 5094, "end_offset": 5149, "text": "most watched streaming platform on TV screens in the US", "global_span": [ 17046, 17101 ] }, { "id": 74, "label": "Non_Traditional", "start_offset": 5270, "end_offset": 5292, "text": "combined TV viewership", "global_span": [ 17222, 17244 ] }, { "id": 75, "label": "Non_Traditional", "start_offset": 5294, "end_offset": 5301, "text": "YouTube", "global_span": [ 17246, 17253 ] }, { "id": 76, "label": "Value", "start_offset": 5302, "end_offset": 5304, "text": "is", "global_span": [ 17254, 17256 ] }, { "id": 77, "label": "Value", "start_offset": 5309, "end_offset": 5315, "text": "second", "global_span": [ 17261, 17267 ] }, { "id": 78, "label": "Non_Traditional", "start_offset": 5316, "end_offset": 5328, "text": "most watched", "global_span": [ 17268, 17280 ] }, { "id": 79, "label": "Non_Traditional", "start_offset": 5447, "end_offset": 5459, "text": "YouTube grow", "global_span": [ 17399, 17411 ] }, { "id": 80, "label": "Value", "start_offset": 5460, "end_offset": 5463, "text": "30%", "global_span": [ 17412, 17415 ] }, { "id": 81, "label": "Non_Traditional", "start_offset": 5464, "end_offset": 5468, "text": "year", "global_span": [ 17416, 17420 ] }, { "id": 82, "label": "Non_Traditional", "start_offset": 5471, "end_offset": 5475, "text": "over", "global_span": [ 17423, 17427 ] }, { "id": 83, "label": "Non_Traditional", "start_offset": 5478, "end_offset": 5482, "text": "year", "global_span": [ 17430, 17434 ] }, { "id": 84, "label": "Value", "start_offset": 6841, "end_offset": 6844, "text": "25%", "global_span": [ 18793, 18796 ] }, { "id": 85, "label": "Non_Traditional", "start_offset": 6845, "end_offset": 6900, "text": "increase in watch time for videos that help people shop", "global_span": [ 18797, 18852 ] }, { "id": 180, "label": "non_traditional", "text": "Advertisers use profit optimization and smart bidding", "start_offset": 2609, "end_offset": 2662, "global_span": [ 14561, 14614 ] }, { "id": 181, "label": "Traditional", "text": "DemandGen", "start_offset": 2991, "end_offset": 3000, "global_span": [ 14943, 14952 ] }, { "id": 182, "label": "Traditional", "text": " for advertisers using Smart Bidding", "start_offset": 4054, "end_offset": 4090, "global_span": [ 16006, 16042 ] }, { "id": 183, "label": "non_traditional", "text": "Mr Beast 's channel", "start_offset": 4826, "end_offset": 4847, "global_span": [ 16778, 16799 ] } ], "relations": [ { "id": 16, "entity_ids": [ 31, 32 ], "description": "Value_of" }, { "id": 17, "entity_ids": [ 31, 33, 34 ], "description": "Value_of" }, { "id": 18, "entity_ids": [ 35, 36, 37, 38, 39 ], "description": "Value_of" }, { "id": 19, "entity_ids": [ 40, 41, 42, 43 ], "description": "Value_of" }, { "id": 20, "entity_ids": [ 44, 45, 46, 47, 48 ], "description": "Value_of" }, { "id": 21, "entity_ids": [ 49, 50, 51, 52, 53, 54, 55 ], "description": "Value_of" }, { "id": 22, "entity_ids": [ 56, 57, 180 ], "description": "Value_of" }, { "id": 23, "entity_ids": [ 58, 59 ], "description": "Value_of" }, { "id": 24, "entity_ids": [ 58, 59, 181 ], "description": "Value_of" }, { "id": 25, "entity_ids": [ 60, 61, 182 ], "description": "Value_of" }, { "id": 26, "entity_ids": [ 62, 63, 64 ], "description": "Value_of" }, { "id": 27, "entity_ids": [ 66, 67, 183 ], "description": "Value_of" }, { "id": 28, "entity_ids": [ 68, 69, 70 ], "description": "Value_of" }, { "id": 29, "entity_ids": [ 74, 75, 76, 77, 78 ], "description": "Value_of" }, { "id": 30, "entity_ids": [ 68, 69, 70, 71 ], "description": "Value_of" }, { "id": 31, "entity_ids": [ 72, 73 ], "description": "Value_of" }, { "id": 32, "entity_ids": [ 79, 80, 81, 82, 83 ], "description": "Value_of" }, { "id": 33, "entity_ids": [ 84, 85 ], "description": "Value_of" } ] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "Ruth Porat: Thank you, Philipp, and thanks, Sundar, for those kind words We had another strong quarter, driven in particular by performance in Search and Cloud, as well as the ongoing efforts to durably reengineer our cost base My comments will be on year - over - year comparisons for the second quarter unless I state otherwise I will start with results at the Alphabet level followed by segment results and conclude with our outlook For the second quarter, our consolidated revenues were $84.7 billion, up 14% or up 15% in constant currency Search remained the largest contributor to revenue growth In terms of expenses, total cost of revenues was $35.5 billion, up 11% Other cost of revenues was $22.1 billion, up 14%, with the increase driven primarily by content acquisition costs, followed by depreciation as well as the impact of the Canadian digital services tax, which was applied retroactively Operating expenses were $218 billion up 5%, primarily reflecting an increase in R&D partially offset by a decline in G&A with sales and marketing essentially flat to the second quarter last year The increase in R&D was driven primarily by compensation which was affected by lapping a reduction in valuation - based compensation liabilities in certain other bets in the second quarter last year followed by depreciation The largest single factor in the year - on - year decline in G&A expenses was lower charges related to legal matters Operating income was $27.4 billion, up 26% and our operating margin was 32% Net income was $23.6 billion and EPS was $1.89 We delivered free cash flow of $13.5 billion in the second quarter and $60.8 billion for the trailing 12 months As a reminder, last year, we had a timing benefit in the second and third quarters from a $10.5 billion deferred cash tax payment made in the fourth quarter, which depressed reported free cash flow growth this quarter, and we 'll do so again next quarter We ended the quarter with $101 billion in cash and marketable securities Turning to segment results Within Google Services, revenues were $73.9 billion, up 12% Google Search and other advertising revenues of $48.5 billion in the quarter were up 14%, led again by growth in retail, followed by the financial services vertical YouTube advertising revenues of $8.7 billion were up 13% driven by brand followed by direct response advertising Network advertising revenues of $7.4 billion were down 5% Subscription platforms and devices revenues were $9.3 billion up 14%, primarily reflecting growth in YouTube subscription revenues TAC was $13.4 billion, up 7% Google Services operating income was $29.7 billion up 27% and the operating margin was 40% Turning to the Google Cloud segment Revenues were $10.3 billion for the quarter, up 29%, reflecting first significant growth in GCP, which was above growth for cloud overall and includes an increasing contribution from AI And second, strong Google Workspace growth, primarily driven by increases in average revenue per seat Google Cloud delivered operating income of $1.2 billion and an operating margin of 11% As to our Other Bets for the second quarter, revenues were $365 million and the operating loss was $1.1 billion Turning to our outlook for the business With respect to Google Services, First, within advertising The strong performance of search was broad - based across verticals In YouTube, we are pleased with the growth in the quarter We had healthy watch time growth continued to close the monetization gap in Shorts and had continued momentum in Connected TV, with brand benefiting in part from an ongoing shift in budgets from linear television to digital As we look forward to the third quarter, we will be lapping the increasing strength in advertising revenues in the second half of 2023, in part from APAC based retailers Turning to subscriptions, platforms and devices First, we continue to have significant growth in our subscriptions business which drives the majority of revenue growth in this line However, there was a sequential decline in the year - on - year growth rate, as we anniversaried the impact of a price increase for YouTubeTV in the second quarter last year The impact will persist through the balance of the year Second, with regard to platforms We are pleased with the performance in play driven by an increase in buyers Finally, with respect to devices The most important point as we look forward is that our Made by Google launches have been pulled forward into the third quarter from the fourth quarter last year benefiting revenues in Q3 this year Turning to cloud, which continued to deliver very strong results For the first time, Cloud crossed $10 billion in quarterly revenues and $1 billion in quarterly operating profit As Sundar noted year - to - date, our AI infrastructure and generative AI solutions for cloud customers have already generated billions in revenues and are being used by more than 2 million developers We 're particularly encouraged that the majority of our top 100 customers are already using our generative AI solutions We continue to invest aggressively in the business Turning to margins The margin expansion in Q2 versus last year reflects our ongoing efforts to durably reengineer our cost base, as well as revenue strength Our leadership team remains focused on our efforts to moderate the pace of expense growth in order to create capacity for the increases in depreciation and expenses associated with the higher levels of investment in our technical infrastructure Once again headcount declined quarter - on - quarter, which reflects both actions we have taken in the first half of the year and a much slower pace of hiring Looking ahead, we expect a slight increase in headcount in the third quarter, as we bring on new graduates As we have discussed previously, we ’re continuing to invest in top engineering and technical talent, particularly in cloud and technical infrastructure Looking forward, we continue to expect to deliver full - year 2024 Alphabet operating margin expansion relative to 2023 However, in the third quarter operating margins will reflect the impact of both the increases in depreciation and expenses associated with the higher levels of investment in our technical infrastructure, as well as the increase in cost of revenues due to the pull - forward of hardware launches into Q3 With respect to CapEx, our reported CapEx in the second quarter was $13 billion, once again driven overwhelmingly by investment in our technical infrastructure with the largest component for servers followed by data centers Looking ahead, we continue to expect quarterly CapEx throughout the year to be roughly at or above the Q1 CapEx of $12 billion keeping in mind that the timing of cash payments can cause variability in quarterly reported CapEx With regard to other bets, we continue to focus on improving overall efficiencies, as we invest for long - term returns Waymo is an important example of this, with its technical leadership coupled with progress on operational performance As you will see in the 10 - Q, we have chosen to commit to a new multi - year investment of $5 billion This new round of funding, which is consistent with recent annual investment levels will enable Waymo to continue to build the world 's leading autonomous driving technology company To close, this is my 56th and last earnings call, 37 of them at Alphabet So I have a few closing thoughts of gratitude I 've been so proud to be at Google and Alphabet as CFO and to work with some of the smartest people in the world every day I think, we have accomplished a lot in the last nine plus years, and I am confident that progress will continue Of course, I 'm not going far and I 'm honored to have my new role, which I 've been slowly working my way into during the past 11 months and I look forward to continuing to work with Sundar, and our great team Being CFO of one of the most important companies in the world has been the opportunity and responsibility of a lifetime Google 's Mission of advancing technology and bringing information to people throughout the world is as relevant today as it was when I worked on its IPO Technology has been a catalyst for economic growth throughout human history The people on this call know that if a technological advancement is not the focus of every business and government, they will be left behind Underpinning this is the need for sound and responsible investment That has never been more important than today and certainly, that is Google and Alphabet 's focus I want to end by thanking Googlers around the world for the innovation and commitment that has enabled us to deliver such extraordinary products and services globally I also want to thank our investors and analysts for your long - term support and your feedback Thank you Sundar, Philipp and I will now take your questions", "ground_truth_output": { "entities": [ { "id": 86, "label": "Traditional", "start_offset": 473, "end_offset": 494, "text": "consolidated revenues", "global_span": [ 20115, 20136 ] }, { "id": 87, "label": "Value", "start_offset": 500, "end_offset": 513, "text": "$84.7 billion", "global_span": [ 20142, 20155 ] }, { "id": 88, "label": "Value", "start_offset": 518, "end_offset": 521, "text": "14%", "global_span": [ 20160, 20163 ] }, { "id": 89, "label": "Value", "start_offset": 528, "end_offset": 531, "text": "15%", "global_span": [ 20170, 20173 ] }, { "id": 90, "label": "Traditional", "start_offset": 535, "end_offset": 552, "text": "constant currency", "global_span": [ 20177, 20194 ] }, { "id": 91, "label": "Value", "start_offset": 664, "end_offset": 677, "text": "$35.5 billion", "global_span": [ 20306, 20319 ] }, { "id": 92, "label": "Value", "start_offset": 682, "end_offset": 685, "text": "11%", "global_span": [ 20324, 20327 ] }, { "id": 93, "label": "Traditional", "start_offset": 702, "end_offset": 710, "text": "revenues", "global_span": [ 20344, 20352 ] }, { "id": 94, "label": "Value", "start_offset": 715, "end_offset": 728, "text": "$22.1 billion", "global_span": [ 20357, 20370 ] }, { "id": 95, "label": "Value", "start_offset": 733, "end_offset": 736, "text": "14%", "global_span": [ 20375, 20378 ] }, { "id": 96, "label": "Value", "start_offset": 747, "end_offset": 755, "text": "increase", "global_span": [ 20389, 20397 ] }, { "id": 97, "label": "Value", "start_offset": 874, "end_offset": 882, "text": "services", "global_span": [ 20516, 20524 ] }, { "id": 98, "label": "Traditional", "start_offset": 922, "end_offset": 940, "text": "Operating expenses", "global_span": [ 20564, 20582 ] }, { "id": 99, "label": "Value", "start_offset": 946, "end_offset": 958, "text": "$218 billion", "global_span": [ 20588, 20600 ] }, { "id": 100, "label": "Value", "start_offset": 962, "end_offset": 964, "text": "5%", "global_span": [ 20604, 20606 ] }, { "id": 101, "label": "Traditional", "start_offset": 1464, "end_offset": 1480, "text": "Operating income", "global_span": [ 21106, 21122 ] }, { "id": 102, "label": "Value", "start_offset": 1485, "end_offset": 1498, "text": "$27.4 billion", "global_span": [ 21127, 21140 ] }, { "id": 103, "label": "Value", "start_offset": 1503, "end_offset": 1506, "text": "26%", "global_span": [ 21145, 21148 ] }, { "id": 104, "label": "Traditional", "start_offset": 1515, "end_offset": 1531, "text": "operating margin", "global_span": [ 21157, 21173 ] }, { "id": 105, "label": "Value", "start_offset": 1536, "end_offset": 1539, "text": "32%", "global_span": [ 21178, 21181 ] }, { "id": 106, "label": "Traditional", "start_offset": 1542, "end_offset": 1552, "text": "Net income", "global_span": [ 21184, 21194 ] }, { "id": 107, "label": "Value", "start_offset": 1557, "end_offset": 1570, "text": "$23.6 billion", "global_span": [ 21199, 21212 ] }, { "id": 108, "label": "Traditional", "start_offset": 1575, "end_offset": 1578, "text": "EPS", "global_span": [ 21217, 21220 ] }, { "id": 109, "label": "Value", "start_offset": 1583, "end_offset": 1588, "text": "$1.89", "global_span": [ 21225, 21230 ] }, { "id": 110, "label": "Traditional", "start_offset": 1604, "end_offset": 1618, "text": "free cash flow", "global_span": [ 21246, 21260 ] }, { "id": 111, "label": "Value", "start_offset": 1622, "end_offset": 1635, "text": "$13.5 billion", "global_span": [ 21264, 21277 ] }, { "id": 112, "label": "Value", "start_offset": 1662, "end_offset": 1675, "text": "$60.8 billion", "global_span": [ 21304, 21317 ] }, { "id": 113, "label": "Traditional", "start_offset": 1684, "end_offset": 1702, "text": "trailing 12 months", "global_span": [ 21326, 21344 ] }, { "id": 114, "label": "Value", "start_offset": 1795, "end_offset": 1808, "text": "$10.5 billion", "global_span": [ 21437, 21450 ] }, { "id": 115, "label": "Traditional", "start_offset": 1809, "end_offset": 1834, "text": "deferred cash tax payment", "global_span": [ 21451, 21476 ] }, { "id": 116, "label": "Traditional", "start_offset": 1847, "end_offset": 1861, "text": "fourth quarter", "global_span": [ 21489, 21503 ] }, { "id": 117, "label": "Value", "start_offset": 1988, "end_offset": 2000, "text": "$101 billion", "global_span": [ 21630, 21642 ] }, { "id": 118, "label": "Traditional", "start_offset": 2004, "end_offset": 2034, "text": "cash and marketable securities", "global_span": [ 21646, 21676 ] }, { "id": 119, "label": "Traditional", "start_offset": 2073, "end_offset": 2088, "text": "Google Services", "global_span": [ 21715, 21730 ] }, { "id": 120, "label": "Traditional", "start_offset": 2090, "end_offset": 2098, "text": "revenues", "global_span": [ 21732, 21740 ] }, { "id": 121, "label": "Value", "start_offset": 2104, "end_offset": 2117, "text": "$73.9 billion", "global_span": [ 21746, 21759 ] }, { "id": 122, "label": "Value", "start_offset": 2119, "end_offset": 2125, "text": "up 12%", "global_span": [ 21761, 21767 ] }, { "id": 123, "label": "Traditional", "start_offset": 2128, "end_offset": 2141, "text": "Google Search", "global_span": [ 21770, 21783 ] }, { "id": 124, "label": "Traditional", "start_offset": 2152, "end_offset": 2172, "text": "advertising revenues", "global_span": [ 21794, 21814 ] }, { "id": 125, "label": "Value", "start_offset": 2176, "end_offset": 2189, "text": "$48.5 billion", "global_span": [ 21818, 21831 ] }, { "id": 126, "label": "Value", "start_offset": 2210, "end_offset": 2216, "text": "up 14%", "global_span": [ 21852, 21858 ] }, { "id": 127, "label": "Traditional", "start_offset": 2295, "end_offset": 2323, "text": "YouTube advertising revenues", "global_span": [ 21937, 21965 ] }, { "id": 128, "label": "Value", "start_offset": 2327, "end_offset": 2339, "text": "$8.7 billion", "global_span": [ 21969, 21981 ] }, { "id": 129, "label": "Value", "start_offset": 2348, "end_offset": 2351, "text": "13%", "global_span": [ 21990, 21993 ] }, { "id": 130, "label": "Traditional", "start_offset": 2410, "end_offset": 2438, "text": "Network advertising revenues", "global_span": [ 22052, 22080 ] }, { "id": 131, "label": "Value", "start_offset": 2442, "end_offset": 2454, "text": "$7.4 billion", "global_span": [ 22084, 22096 ] }, { "id": 132, "label": "Value", "start_offset": 2465, "end_offset": 2467, "text": "5%", "global_span": [ 22107, 22109 ] }, { "id": 133, "label": "Traditional", "start_offset": 2470, "end_offset": 2492, "text": "Subscription platforms", "global_span": [ 22112, 22134 ] }, { "id": 134, "label": "Traditional", "start_offset": 2497, "end_offset": 2513, "text": "devices revenues", "global_span": [ 22139, 22155 ] }, { "id": 135, "label": "Value", "start_offset": 2519, "end_offset": 2531, "text": "$9.3 billion", "global_span": [ 22161, 22173 ] }, { "id": 136, "label": "Value", "start_offset": 2535, "end_offset": 2538, "text": "14%", "global_span": [ 22177, 22180 ] }, { "id": 137, "label": "Traditional", "start_offset": 2603, "end_offset": 2606, "text": "TAC", "global_span": [ 22245, 22248 ] }, { "id": 138, "label": "Value", "start_offset": 2611, "end_offset": 2624, "text": "$13.4 billion", "global_span": [ 22253, 22266 ] }, { "id": 139, "label": "Value", "start_offset": 2626, "end_offset": 2631, "text": "up 7%", "global_span": [ 22268, 22273 ] }, { "id": 140, "label": "Traditional", "start_offset": 2634, "end_offset": 2666, "text": "Google Services operating income", "global_span": [ 22276, 22308 ] }, { "id": 141, "label": "Value", "start_offset": 2671, "end_offset": 2691, "text": "$29.7 billion up 27%", "global_span": [ 22313, 22333 ] }, { "id": 142, "label": "Traditional", "start_offset": 2700, "end_offset": 2716, "text": "operating margin", "global_span": [ 22342, 22358 ] }, { "id": 143, "label": "Value", "start_offset": 2721, "end_offset": 2724, "text": "40%", "global_span": [ 22363, 22366 ] }, { "id": 144, "label": "Traditional", "start_offset": 2742, "end_offset": 2754, "text": "Google Cloud", "global_span": [ 22384, 22396 ] }, { "id": 145, "label": "Traditional", "start_offset": 2763, "end_offset": 2771, "text": "Revenues", "global_span": [ 22405, 22413 ] }, { "id": 146, "label": "Value", "start_offset": 2777, "end_offset": 2790, "text": "$10.3 billion", "global_span": [ 22419, 22432 ] }, { "id": 147, "label": "Value", "start_offset": 2808, "end_offset": 2814, "text": "up 29%", "global_span": [ 22450, 22456 ] }, { "id": 148, "label": "Traditional", "start_offset": 3055, "end_offset": 3067, "text": "Google Cloud", "global_span": [ 22697, 22709 ] }, { "id": 149, "label": "Traditional", "start_offset": 3078, "end_offset": 3094, "text": "operating income", "global_span": [ 22720, 22736 ] }, { "id": 150, "label": "Value", "start_offset": 3098, "end_offset": 3110, "text": "$1.2 billion", "global_span": [ 22740, 22752 ] }, { "id": 151, "label": "Traditional", "start_offset": 3118, "end_offset": 3134, "text": "operating margin", "global_span": [ 22760, 22776 ] }, { "id": 152, "label": "Value", "start_offset": 3138, "end_offset": 3141, "text": "11%", "global_span": [ 22780, 22783 ] }, { "id": 153, "label": "Traditional", "start_offset": 3154, "end_offset": 3159, "text": "Other", "global_span": [ 22796, 22801 ] }, { "id": 154, "label": "Non_Traditional", "start_offset": 3160, "end_offset": 3164, "text": "Bets", "global_span": [ 22802, 22806 ] }, { "id": 155, "label": "Traditional", "start_offset": 3173, "end_offset": 3187, "text": "second quarter", "global_span": [ 22815, 22829 ] }, { "id": 156, "label": "Traditional", "start_offset": 3189, "end_offset": 3197, "text": "revenues", "global_span": [ 22831, 22839 ] }, { "id": 157, "label": "Value", "start_offset": 3203, "end_offset": 3215, "text": "$365 million", "global_span": [ 22845, 22857 ] }, { "id": 158, "label": "Traditional", "start_offset": 3224, "end_offset": 3238, "text": "operating loss", "global_span": [ 22866, 22880 ] }, { "id": 159, "label": "Value", "start_offset": 3243, "end_offset": 3255, "text": "$1.1 billion", "global_span": [ 22885, 22897 ] }, { "id": 160, "label": "Traditional", "start_offset": 4743, "end_offset": 4748, "text": "Cloud", "global_span": [ 24385, 24390 ] }, { "id": 161, "label": "Value", "start_offset": 4757, "end_offset": 4768, "text": "$10 billion", "global_span": [ 24399, 24410 ] }, { "id": 162, "label": "Traditional", "start_offset": 4772, "end_offset": 4790, "text": "quarterly revenues", "global_span": [ 24414, 24432 ] }, { "id": 163, "label": "Value", "start_offset": 4795, "end_offset": 4805, "text": "$1 billion", "global_span": [ 24437, 24447 ] }, { "id": 164, "label": "Traditional", "start_offset": 4809, "end_offset": 4835, "text": "quarterly operating profit", "global_span": [ 24451, 24477 ] }, { "id": 165, "label": "Value", "start_offset": 4965, "end_offset": 4973, "text": "billions", "global_span": [ 24607, 24615 ] }, { "id": 166, "label": "Traditional", "start_offset": 4977, "end_offset": 4985, "text": "revenues", "global_span": [ 24619, 24627 ] }, { "id": 167, "label": "Value", "start_offset": 5018, "end_offset": 5038, "text": "2 million developers", "global_span": [ 24660, 24680 ] }, { "id": 168, "label": "Traditional", "start_offset": 6492, "end_offset": 6497, "text": "CapEx", "global_span": [ 26134, 26139 ] }, { "id": 169, "label": "Value", "start_offset": 6544, "end_offset": 6555, "text": "$13 billion", "global_span": [ 26186, 26197 ] }, { "id": 170, "label": "Value", "start_offset": 6817, "end_offset": 6828, "text": "$12 billion", "global_span": [ 26459, 26470 ] }, { "id": 171, "label": "Traditional", "start_offset": 7250, "end_offset": 7260, "text": "investment", "global_span": [ 26892, 26902 ] }, { "id": 172, "label": "Value", "start_offset": 7264, "end_offset": 7274, "text": "$5 billion", "global_span": [ 26906, 26916 ] }, { "id": 184, "label": "Traditional", "text": "total cost of revenues", "start_offset": 637, "end_offset": 659, "global_span": [ 20279, 20301 ] }, { "id": 185, "label": "Traditional", "text": "down ", "start_offset": 2460, "end_offset": 2465, "global_span": [ 22102, 22107 ] }, { "id": 186, "label": "Traditional", "text": "AI infrastructure and generative AI solutions for cloud customers", "start_offset": 4876, "end_offset": 4941, "global_span": [ 24518, 24583 ] }, { "id": 187, "label": "Traditional", "text": " Q1 CapEx", "start_offset": 6804, "end_offset": 6813, "global_span": [ 26446, 26455 ] }, { "id": 188, "label": "Traditional", "text": "multi - year", "start_offset": 7237, "end_offset": 7249, "global_span": [ 26879, 26891 ] }, { "id": 189, "label": "Traditional", "text": "commit ", "start_offset": 7221, "end_offset": 7228, "global_span": [ 26863, 26870 ] } ], "relations": [ { "id": 34, "entity_ids": [ 86, 87 ], "description": "Value_of" }, { "id": 35, "entity_ids": [ 86, 88 ], "description": "Value_of" }, { "id": 36, "entity_ids": [ 86, 89, 90 ], "description": "Value_of" }, { "id": 37, "entity_ids": [ 91, 184 ], "description": "Value_of" }, { "id": 38, "entity_ids": [ 92, 184 ], "description": "Value_of" }, { "id": 39, "entity_ids": [ 93, 94 ], "description": "Value_of" }, { "id": 40, "entity_ids": [ 93, 95 ], "description": "Value_of" }, { "id": 41, "entity_ids": [ 93, 96 ], "description": "Value_of" }, { "id": 42, "entity_ids": [ 98, 99 ], "description": "Value_of" }, { "id": 43, "entity_ids": [ 98, 100 ], "description": "Value_of" }, { "id": 44, "entity_ids": [ 101, 102 ], "description": "Value_of" }, { "id": 45, "entity_ids": [ 101, 103 ], "description": "Value_of" }, { "id": 46, "entity_ids": [ 104, 105 ], "description": "Value_of" }, { "id": 47, "entity_ids": [ 106, 107 ], "description": "Value_of" }, { "id": 48, "entity_ids": [ 108, 109 ], "description": "Value_of" }, { "id": 49, "entity_ids": [ 110, 111 ], "description": "Value_of" }, { "id": 50, "entity_ids": [ 110, 111, 112, 113 ], "description": "Value_of" }, { "id": 51, "entity_ids": [ 114, 115, 116 ], "description": "Value_of" }, { "id": 52, "entity_ids": [ 117, 118 ], "description": "Value_of" }, { "id": 53, "entity_ids": [ 119, 120, 121 ], "description": "Value_of" }, { "id": 54, "entity_ids": [ 119, 120, 122 ], "description": "Value_of" }, { "id": 55, "entity_ids": [ 123, 124, 125 ], "description": "Value_of" }, { "id": 56, "entity_ids": [ 123, 124, 126 ], "description": "Value_of" }, { "id": 57, "entity_ids": [ 127, 128 ], "description": "Value_of" }, { "id": 58, "entity_ids": [ 127, 129 ], "description": "Value_of" }, { "id": 59, "entity_ids": [ 130, 131 ], "description": "Value_of" }, { "id": 60, "entity_ids": [ 130, 132, 185 ], "description": "Value_of" }, { "id": 61, "entity_ids": [ 133, 134, 135 ], "description": "Value_of" }, { "id": 62, "entity_ids": [ 133, 134, 136 ], "description": "Value_of" }, { "id": 63, "entity_ids": [ 137, 138 ], "description": "Value_of" }, { "id": 64, "entity_ids": [ 137, 139 ], "description": "Value_of" }, { "id": 65, "entity_ids": [ 140, 141 ], "description": "Value_of" }, { "id": 66, "entity_ids": [ 142, 143 ], "description": "Value_of" }, { "id": 67, "entity_ids": [ 144, 145, 146 ], "description": "Value_of" }, { "id": 68, "entity_ids": [ 144, 145, 147 ], "description": "Value_of" }, { "id": 69, "entity_ids": [ 148, 149, 150 ], "description": "Value_of" }, { "id": 70, "entity_ids": [ 148, 151, 152 ], "description": "Value_of" }, { "id": 71, "entity_ids": [ 153, 154, 155, 156, 157 ], "description": "Value_of" }, { "id": 72, "entity_ids": [ 153, 154, 155, 158, 159 ], "description": "Value_of" }, { "id": 73, "entity_ids": [ 160, 161, 162 ], "description": "Value_of" }, { "id": 74, "entity_ids": [ 160, 163, 164 ], "description": "Value_of" }, { "id": 75, "entity_ids": [ 165, 166, 167, 186 ], "description": "Value_of" }, { "id": 76, "entity_ids": [ 168, 169 ], "description": "Value_of" }, { "id": 77, "entity_ids": [ 170, 187 ], "description": "Value_of" }, { "id": 78, "entity_ids": [ 171, 172, 188, 189 ], "description": "Value_of" } ] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Operator: Thank you [Operator Instructions ] Your first question comes from Brian Nowak with Morgan Stanley Your line is now open", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "Brian Nowak: Thanks for taking my questions First, thank you Ruth for all the help and significant impact over the past decade The first one, it is a little bit of a jump ball, I guess for Sundar, Philipp or Ruth I guess we 're sort of 18 months this fever pitch around the GenAI focus in the world Maybe from any of your perspective, can you just sort of talk to us about areas where you 've seen faster than expected traction or testing adoption of some of the AI, generative AI capabilities versus slower than expected traction and testing from a Google perspective And then, Ruth I appreciate all the comments about structurally reengineering the OpEx base Are there any more tangible examples of areas you can talk to us about where you still see further ways to drive more efficiency across the company Thanks", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Sundar Pichai: Brian, thanks I 'll take the first part I think it 's a good question Obviously, I think there is a time curve in terms of taking the underlying technology and translating it into meaningful solutions across the Board, both on the consumer and the enterprise side Definitely, on the consumer side, I 'm pleased, as I said in my comments earlier in terms of how for a product like Search, which is used at that scale over many decades How we 've been able to introduce it in a way that it 's additive and enhances the overall experience and this positively contributing there I think across our consumer products, we 've been able -- I think we are seeing progress on the organic side Obviously monetization is something that we would have to earn on top of it The enterprise side, I think we are at a stage where definitely there are a lot of models I think roughly, the models are all kind of converging towards a set of base capabilities But I think where the next wave is, working to build solutions on top of it And I think there are pockets, be it coding, be it in customer service, et cetera, where we are seeing some of those use cases seeing traction, but I still think there is hard work there to completely unlock those", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Ruth Porat: And on your second question first, thank you for your comments Look, the reason we 've consistently used the term, the phrase that we 're focused on durably reengineering our cost base is because these are deep work streams They are not tactical fixes, and we continue to build on them And so the main areas that we 've talked about are around product and process prioritization around organizational efficiency and structure Both of those are reflected in the headcount and the fact that headcount is down year - on - year And across all of those -- as I said, across our entire leadership team, we remain focused on continuing to execute against them So in terms of the most recent examples, as we talked about last quarter with the combination of the devices and services product area with the platforms and ecosystems product area, we announced that back in April And what we discussed last quarter and what we 're seeing is that unifying teams across these organizations, helps with product execution and what we 're really focused on is really adding to velocity and efficiency So kind of the gift that keeps giving And then more broadly, all of the work streams that we 've talked to you about before, we continue to remain focused on A big one, very important one, is all of the efficiency efforts, the work streams around technical infrastructure and improving efficiency there We are also working on the use of AI across Alphabet We are working on continuing to build on what we 've done with our centralized procurement organization We are continuing to optimize our real estate portfolio And so again this is across our leadership team These are efforts that all build to this phrase durably reengineering our cost base", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Brian Nowak: Great Thank you both", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Doug Anmuth with JPMorgan Your line is now open", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Doug Anmuth: Thanks for taking my questions One for Ruth and one for Sundar Ruth you 've now had Google Services operating margins roughly 40% for the past two quarters Just as you create more capacity to help offset the future investments, is it reasonable to think that you could sustain at those kind of levels going forward? And then, Sundar just as it relates to AI overviews, you talked about the positive trends there Can you just help us understand where you are, how far along in rolling - out AI overviews and then any more color around kind of click - through rates and monetization levels relative to your traditional searches Thanks", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Ruth Porat: So in terms of the Google services operating margin, it did reflect all the work that we are doing on durably reengineering the cost base It also reflected the benefit of strong revenue performance in search And so what I tried to lay out in the comments, as we look forward to the third quarter is operating margins will reflect the increases in depreciation and expenses associated with higher levels of our investment in technical infrastructure It will also reflect higher expenses associated with the Pixel launch, due to the pull forward So those are important factors I would say, overall company - wide, it is important to note that we do expect to continue to deliver full year ' 24 Alphabet operating margin expansion relative to 2023, but I did want to highlight those important points as we look forward to Q3", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Sundar Pichai: And Doug, thanks On the AI overview, we are -- we have rolled it out in the US and we are -- will be through the course of the year, definitely scaling it up both to more countries And also, we have taken a conservative start focused on quality, making sure the metrics are healthy and so on, but you will see us expand the use cases around it, and we 'll touch definitely more queries All the feedbacks we have seen are positive And on the monetization side, I think Philipp has touched upon it Maybe Philipp, anything more you want to add there?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Philipp Schindler: Yes, look, innovation and improvements to the user experience on search have historically opened up new opportunities for advertisers We talked about this before we saw this when we navigated from desktop to mobile for example And we can see GenAI obviously expand the types of questions we can help people with, as Sundar mentioned And as we said before, people are finding ads either above or below AI overviews helpful We have a solid baseline here from which we can innovate and as you have probably noticed at GML, we announced that soon we 'll actually start testing Search and Shopping ads in AI overviews for users in the US, and they will have the opportunity to actually appear within the overview in a section clearly labeled as sponsored, when they 're relevant to both the query and the information in the AI overview, really giving us the ability to innovate here and take this to the next level", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "Doug Anmuth: Thank you Best of luck, Ruth, in your new role", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Ruth Porat: Thank you", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Michael Nathanson with Moffett Please go ahead", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Michael Nathanson: Thanks I have two, one for Sundar and one for Philipp Sundar, on decision this week to not deprecate cookies I know it 's been a long journey Can you talk a bit about what we should expect in terms of new experience in Chrome and why the company makes a decision not to go down the path on deprecating cookies And then Philipp, I know it 's only one quarter, but it 's interesting that Search is growing faster than YouTube, which surprised some of us But can you talk about what factors you think are kind of differences in growth rates between these markets? And is there anything on the AI front that you could see maybe reaccelerating YouTube growth, as you 've seen happen with Search Thanks so much", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Sundar Pichai: And Michael on cookies, Look I think, obviously we are super committed to improving privacy for users in chrome and there was the whole focus around privacy sandbox and we remain committed on the journey, but on third - party cookies, given the implications across the ecosystems and considerations and feedback across so many stakeholders We now believe user choice is the best path forward there and we 'll both improve privacy by giving users choice and we 'll continue our investments in privacy enhancing technologies, but it is obviously an area we will be taking feedback from the players in the ecosystem and we are committed to being privacy first as well", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "Philipp Schindler: And on the second part of your question, maybe Ruth, you want to jump in first and then I take the rest if needed", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Ruth Porat: Absolutely So Look, as we both noted, search revenues really reflected broad based growth across verticals That was led by retail followed by financial services I think your question really goes to the heart of the year - on - year growth comparison And as both Philipp and I noted, we are really pleased with YouTube, the YouTube team all that was done, it was driven by brand followed by direct response, and they have very strong ongoing operating metrics, which Philipp will comment on I think the important point to note, and I tried to tease out in opening comments, was that the deceleration in this year - on - year revenue growth for the second quarter versus the first quarter, primarily reflected the tougher comparison versus the first quarter because at that point, as you probably recall, YouTube was lapping negative year - on - year growth in Q1 last year And then also Q1 benefited from the extra from leap year And so what you are also seeing here is with YouTube, we were [anniversaring ] (ph) the ramp in APAC based retailers that began in the second quarter last year and foreign exchange headwinds as well that we noted And so it 's -- there are some timing issues going on And what we are trying to highlight is the underlying operating strength Back to you, Philipp", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Philipp Schindler: Yes, that was very comprehensive Nothing really to add from my side here", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Sundar Pichai: The only thing I would say, adding to Brian 's first question on areas where things are maybe taking longer I think, look we are all building multimodal models At least Gemini has been natively multimodal from the ground up But most of the use cases today that have been unlocked have been around the tech side So in terms of getting real generative audio, video experience is working well I think there is still – it is going to take some time But over time, obviously it will be deeply relevant to YouTube and so it 's an area I 'm excited about in the future", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Michael Nathanson: Okay Thanks a lot And best to you Thanks", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Operator: Your next question comes from Eric Sheridan with Goldman Sachs Your line is now open", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Eric Sheridan: Thanks so much And I 'll echo the thanks for Ruth, for all the insights and partnership over the years on these earnings calls Sundar maybe first for you, in terms of Cloud and bringing AI to the enterprise, I wanted to know if you go a little bit deeper in terms of how you are seeing AI actually get adopted implemented, what it potentially could mean for the strategic positioning of the cloud business and the potential for AI workloads to be a stimulant to revenue growth for Cloud first And then following up the last set of questions on YouTube are really about the macro or the ad environment What do you guys, as a team, continue to learn about the subscription side of YouTube and the appetite for consumers to engage with a broader array of media products at the subscription layer Thanks", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 27, "sub_chunk_id": 0, "sentences": "Sundar Pichai: Thanks Eric Look, on the Cloud and AI stuff, obviously, it is something which I think will end up being a big driver over time I mentioned in my opening remarks, already if you take a look at our AI infrastructure and generative AI solutions for cloud across everything we do, be it compute on the AI side, the products we have through Vertex AI, Gemini for Workspace and Gemini for Google Cloud, et cetera, we definitely are seeing traction People are deeply engaging with Gemini models across Vertex and AI studio We now have over 2 million developers playing around with these things, and you are definitely seeing early use cases But I think we are in this phase, where we have to deeply work and make sure on these use cases, on these workflows We are driving deeper progress on unlocking value, which I 'm very bullish will happen, but these things take time So -- but if I were to take a longer - term outlook, I definitely see a big opportunity here And I think particularly for us, given the extent to which we are investing in AI, our research infrastructure leadership, all of that translates directly And so I 'm pretty excited about the opportunity space ahead", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 28, "sub_chunk_id": 0, "sentences": "Ruth Porat: And then on your second question with respect to subscriptions, I am implicit in your question, how strong is it, as I noted in opening comments, that overall line subscriptions platforms and devices delivered healthy growth and that was led by subscriptions And as we 've said on many calls here in a row, the subscription revenue growth continued to be quite strong It was driven by subscriber growth in both YouTube TV and YouTube Music premium And then the other component within that line is Google One that also delivered strong subscriber and revenue growth I think the heart of your question is really around YouTube and that is the heart of the revenues in that line So it continues to be very strong We see a lot of take up in it, strong subscriber growth, really pleased with it We did note that growth on that line decelerated due to anniversarying the YouTube TV price increase But at the heart of it, our people interested in the subscription offerings and it ’s the take of significant We 're really pleased with it", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 29, "sub_chunk_id": 0, "sentences": "Eric Sheridan: Thank you", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 30, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Ross Sandler with Barclays Your line is now open", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 31, "sub_chunk_id": 0, "sentences": "Ross Sandler: Hi, everybody Just two questions on the AI CapEx So it looks like from the outside at least, the hyperscaler industry is going from kind of an under bill situation this time last year to better meeting the demand with capacity right now to potentially being overbuilt next year if these CapEx growth rates keep up So do you think that 's a fair characterization? And how are we thinking about the return on invested capital with this AI CapEx cycle And then related to that, do you think that the AI industry is close to or far away from hitting some kind of wall on foundation model improvement in AI training, based on like lack of availability of new data to train on Just your thoughts on that would be great Thank you", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 32, "sub_chunk_id": 0, "sentences": "Sundar Pichai: Thanks Ross I think great questions Look, I -- obviously, we are at an early stage of what I view as a very transformative area and in technology when you are going through these transitions, aggressively investing upfront in a defining category, particularly in an area in which in a leveraged way cuts across all our core areas our products, including Search, YouTube and other services, as well as fuels growth in Cloud and supports the innovative long - term Bets and Other Bets is definitely something for us makes sense to lean in I think the one way I think about it is when we go through a curve like this, the risk of under - investing is dramatically greater than the risk of over - investing for us here, even in scenarios where if it turns out that we are over investing We clearly -- these are infrastructure, which are widely useful for us They have long useful lives and we can apply it across, and we can work through that But I think not investing to be at the frontier, I think definitely has much more significant downside Having said that, we obsess around every dollar we put in Our teams are -- work super hard, I 'm proud of the efficiency work, be it optimization of hardware, software, model deployment across our fleet All of that is something we spend a lot of time on, and that 's how we think about it To your second question on whether -- how do the scaling loss hold Are we hitting on some kind of wall or something? Look, I think we are all pushing very hard, and there is going to be a few efforts, which will scale up on the compute side and push the boundaries of these models What I would tell is regardless of how that plays out, you still think there is enough optimizations we are all doing, which is driving constant progress in terms of the capabilities of the models And more importantly, taking them and translating into real use cases across the consumer and enterprise side, I think on that frontier I think there is still a lot of progress to be had And so we are pretty focused on that as well", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 33, "sub_chunk_id": 0, "sentences": "Ross Sandler: Thank you", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 34, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Stephen Ju with UBS Your line is now open", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 35, "sub_chunk_id": 0, "sentences": "Stephen Ju: Okay Thank you so much So Sundar, I guess to ask the AI question a different way As we talk to some of the model builders out there, it looks like the initial use cases are more on the cost savings or efficiency side But when do we -- when do you think we 'll start thinking about products that can help revenue generation for the Fortune 500, Fortune 1000 companies, which is probably something that can hopefully create greater value over time versus just cutting costs? And Philipp, listening to what will be, I guess Ruth 's final comments on Q2 on these public calls And thank you, by the way Ruth, for all the help I could n't help but notice that the bigger factors were brand followed by direct response And if we continue to think that the one you bring up first is the larger factor and tying this into your prior commentary about shopping being an important consideration When do you think we 'll start talking about direct response being a much bigger contributor to YouTube 's growth versus brand? Thank you", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 36, "sub_chunk_id": 0, "sentences": "Sundar Pichai: On the first part of the question look I think the technology 's horizontal enough, it can apply on both sides If you take a use case like improving the customer service experience, it is part of it which is driving efficiencies, and you can look at it from a cost standpoint, but you could also be overall improving the experience, improving conversion, driving the funnel better And so increasing basket size if you are a retail e - commerce player, et cetera So we are seeing people experiment across both sides And so I think, you will see it played across both sides Philipp, on the second one?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 37, "sub_chunk_id": 0, "sentences": "Philipp Schindler: Yes On the second one, look on the direct response side, as you know it is about driving and converting commercial intent and customers are obviously benefiting from including video in their AI - powered campaigns, it could be PMax, it could be DemandGen and obviously using our automated tools to enhance and create video creatives And we are very, very optimistic about this path On average advertisers who run both image and video ads with DemandGen campaigns see 6% more conversions per dollar than those running image only ads and discovery And this is just one little example of how this can obviously boost your performance business So that 's a big part The brand side, as you know Google AI continues to make it easier for brands to show up next to the content where viewers are obviously the most engaged And they 're finding it, as you can see from the numbers, a very effective way to drive awareness and consideration And we are also quite excited about some of the recent launches on YouTube shopping side, if you want to put that into the direct response bucket", "ground_truth_output": { "entities": [ { "id": 173, "label": "Non_Traditional", "start_offset": 469, "end_offset": 488, "text": "DemandGen campaigns", "global_span": [ 48001, 48020 ] }, { "id": 174, "label": "Value", "start_offset": 493, "end_offset": 495, "text": "6%", "global_span": [ 48025, 48027 ] }, { "id": 175, "label": "Non_Traditional", "start_offset": 496, "end_offset": 512, "text": "more conversions", "global_span": [ 48028, 48044 ] }, { "id": 176, "label": "Value", "start_offset": 513, "end_offset": 523, "text": "per dollar", "global_span": [ 48045, 48055 ] } ], "relations": [ { "id": 79, "entity_ids": [ 173, 174, 175, 176 ], "description": "Value_of" } ] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 38, "sub_chunk_id": 0, "sentences": "Stephen Ju: Okay Thank you", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 39, "sub_chunk_id": 0, "sentences": "Operator: And our last question comes from Justin Post with Bank of America Your line is now open", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 40, "sub_chunk_id": 0, "sentences": "Justin Post: Great I 'll ask a couple of areas First on the cloud acceleration, would you characterize that as new AI demand helping drive that year - to - date? Or is that more of a rebound in just general compute and other demand or is AI really moving this forward and helping drive acceleration And then I wanted to ask about your internal cost savings which has been really strong How are you using AI internally to help cut costs? Are you seeing better efficiencies with your engineers? And just would love to hear about how you are applying AI to cut your own costs? Thank you", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 41, "sub_chunk_id": 0, "sentences": "Ruth Porat: Great Thank you for that So overall we are -- as both Sundar and I said, we are very pleased with the results in Cloud And there is clearly a benefit as the Cloud team is engaging broadly with customers around the globe with AI related solutions, AI infrastructure solutions and the generative - AI solutions I think we noted that we 're particularly encouraged that the majority of our top 100 customers are already using our generative AI solution So it is clearly adding to strength of the business on top of all that they are doing And just to be really clear, the results for GCP, the growth rate for GCP is above the growth for cloud overall And then I 'll turn it to Sundar on the cost saving point, but just one point we are really pleased as well that Cloud 's margin improved as it did And in part, that reflects the revenue strength that they delivered and all of the efficiency efforts that I 've already spoken about But looking ahead in Q3, we do expect the same seasonal pattern that you saw last year with respect to margin and we are continuing to invest in the business", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 42, "sub_chunk_id": 0, "sentences": "Sundar Pichai: Look, I think specifically, if the question is about engineers and coding, et cetera, we definitely want to be on the cutting edge there I think, we are making these tools available to some of the most [line of ] (ph) productive engineers and demanding engineers out there, and they are definitely kicking the tires hard And -- but I would say, it 's still all in very early stages I think particularly when it comes to writing high - quality secure code, but I think all the learnings what we are gaining here will translate into our models and products, and that 's the virtuous cycle, which I 'm excited by So there 's a lot more to come", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 43, "sub_chunk_id": 0, "sentences": "Justin Post: Great, thank you", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 44, "sub_chunk_id": 0, "sentences": "Operator: Thank you And that concludes our question - and - answer session for today I 'd like to turn the conference back over to Jim Friedland for any further remarks", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 45, "sub_chunk_id": 0, "sentences": "Jim Friedland: Thanks everyone for joining us today We look forward to speaking with you again on our third quarter 2024 call Thank you and have a good evening", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "GOOGL", "quarter": 2, "year": 2024, "date": "2024-07-23 16:30:00", "chunk_id": 46, "sub_chunk_id": 0, "sentences": "Operator: Thank you everyone This concludes today 's conference call Thank you for participating You may now disconnect", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Operator: Greetings, and welcome to the Home Depot Fourth Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen - only mode. A brief question - and - answer session will follow the formal presentation. [Operator Instructions ] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Isabel Janci. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Isabel Janci: Thank you, Christine, and good morning, everyone. Welcome to Home Depot 's fourth quarter and fiscal year 2023 earnings call. Joining us on our call today are Ted Decker, Chair, President and CEO; Ann - Marie Campbell, Senior Executive Vice President; Billy Bastek, Executive Vice President of Merchandising; and Richard McPhail, Executive Vice President and Chief Financial Officer. Following our prepared remarks, the call will be open for questions. Questions will be limited to analysts and investors. [Operator Instructions ] If we are unable to get to your question during the call, please call our Investor Relations department at 770 - 384 - 2387. Before I turn the call over to Ted, let me remind you that today 's press release and the presentations made by our executives include forward - looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations and projections. These risks and uncertainties include but are not limited to the factors identified in the release and in our filings with the Securities and Exchange Commission. Today 's presentation will also include certain non - GAAP measures. Reconciliation of these measures is provided on our website. Now, let me turn the call over to Ted.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Edward Decker: Thank you, Isabel, and good morning, everyone. As you 'll hear from the team shortly, the fourth quarter of fiscal 2023 was largely in line with our expectations. For fiscal 2023, sales were $152.7 billion, down 3% from the prior year. Comp sales declined 3.2% versus last year, and our U.S. stores had negative comps of 3.5%. Diluted earnings per share were $15.11 compared to $16.69 in the prior year. After three years of exceptional growth for our business, 2023 was a year of moderation. It was also a year of opportunity. We focused on several operational improvements to strengthen the business, while also staying true to the growth opportunities detailed at our Investor Conference in June. As we reflect on 2023, we are better positioned in four key areas. We invested in our associates, the heartbeat of our company and the storage of customer service, effectively manage disinflation, while maintaining a strong value proposition for our customers, right sized our inventory position in increased in - stock and on - shelf availability levels, and we reduced fixed costs in the business that were introduced during the pandemic. As you know, at the beginning of 2023, we announced an approximately $1 billion investment in increased annualized compensation for our frontline hourly associates. This allowed us to improve customer service, position ourselves favorably in the market, attract and retain the most qualified talent, drive greater efficiency and productivity across the business, and improve safely broadly. We also navigated a unique disinflationary environment. We did this by leveraging our best - in - class cost finance team in merchants to effectively manage cost movements, while also being our customers advocate for value. And we believe prices have essentially settled in the marketplace. After several years of unprecedented sales growth, we entered 2023 with more inventory than we would ' ve preferred. While the products we sell have low obsolescence, our teams work throughout the year to improve inventory productivity while delivering the highest in - stock and on - shelf availability rates since the pandemic. Today, we feel very good about our inventory position heading into 2024. Productivity and efficiency are hallmarks of the Home Depot, and as you heard at our Investor Conference in June, we announced our commitment to reduce fixed costs by approximately $500 million to be fully realized in 2024. We ' ve now taken the necessary actions to achieve this cost benefit, which Richard will detail in a moment. As we look forward to 2024, we remain focused on our strategic opportunities of creating the best interconnected experience, growing our Pro wallet share through our unique ecosystem of capabilities and building new stores. In December 2023, we made a strategic acquisition of Construction Resources, a leading distributor of design - oriented surfaces, appliances, and architectural specialty products for Pro contractors focused on renovation, remodeling, and residential home building. This acquisition adds to our robust product offering of products and services. It allows our complex Pro ’s to easily shop across aesthetic product categories in a showroom setting, which is how they 're accustomed to shopping for these types of goods. We are excited to welcome Construction Resources into the Home Depot family. In 2024, we will continue learning and building out new capabilities for the complex Pro. We are expanding our assortments, fulfillment options and our outside sales force and just recently began piloting trade credit options. In addition, we continue to work on new order management capabilities to better manage complex Pro orders. For the complex Pro opportunity, this means that by the end of 2024, we will have 17 of our top Pro markets equipped with new fulfillment options, localized product assortment and expanded sales force and enhanced digital capabilities with trade credit and order management in pilot for development. What I hope you take away today is how great we feel about our business and how well we are positioning the business for the future. We remain excited about the opportunity to grow our share of a fragmented $950 billion - plus market. Our associates and supplier partners have continually demonstrated agility and resilience, and I want to thank them for their hard work and dedication to serving our customers and communities. And with that, I 'd like to turn the call over to Ann.", "ground_truth_output": { "entities": [ { "id": 1, "label": "Traditional", "start_offset": 196, "end_offset": 201, "text": "sales", "global_span": [ 1963, 1968 ] }, { "id": 2, "label": "Value", "start_offset": 207, "end_offset": 221, "text": "$152.7 billion", "global_span": [ 1974, 1988 ] }, { "id": 3, "label": "Traditional", "start_offset": 223, "end_offset": 227, "text": "down", "global_span": [ 1990, 1994 ] }, { "id": 4, "label": "Value", "start_offset": 228, "end_offset": 235, "text": "3% from", "global_span": [ 1995, 2002 ] }, { "id": 5, "label": "Traditional", "start_offset": 252, "end_offset": 271, "text": "Comp sales declined", "global_span": [ 2019, 2038 ] }, { "id": 6, "label": "Value", "start_offset": 272, "end_offset": 276, "text": "3.2%", "global_span": [ 2039, 2043 ] }, { "id": 7, "label": "Traditional", "start_offset": 277, "end_offset": 293, "text": "versus last year", "global_span": [ 2044, 2060 ] }, { "id": 8, "label": "Traditional", "start_offset": 319, "end_offset": 333, "text": "negative comps", "global_span": [ 2086, 2100 ] }, { "id": 9, "label": "Value", "start_offset": 337, "end_offset": 341, "text": "3.5%", "global_span": [ 2104, 2108 ] }, { "id": 10, "label": "Traditional", "start_offset": 343, "end_offset": 369, "text": "Diluted earnings per share", "global_span": [ 2110, 2136 ] }, { "id": 11, "label": "Value", "start_offset": 375, "end_offset": 381, "text": "$15.11", "global_span": [ 2142, 2148 ] }, { "id": 12, "label": "Value", "start_offset": 394, "end_offset": 403, "text": "$16.69 in", "global_span": [ 2161, 2170 ] }, { "id": 13, "label": "Traditional", "start_offset": 408, "end_offset": 418, "text": "prior year", "global_span": [ 2175, 2185 ] }, { "id": 14, "label": "Value", "start_offset": 1226, "end_offset": 1236, "text": "$1 billion", "global_span": [ 2993, 3003 ] }, { "id": 15, "label": "Traditional", "start_offset": 1237, "end_offset": 1247, "text": "investment", "global_span": [ 3004, 3014 ] }, { "id": 16, "label": "Traditional", "start_offset": 1251, "end_offset": 1320, "text": "increased annualized compensation for our frontline hourly associates", "global_span": [ 3018, 3087 ] }, { "id": 17, "label": "Value", "start_offset": 2096, "end_offset": 2103, "text": "highest", "global_span": [ 3863, 3870 ] }, { "id": 18, "label": "Traditional", "start_offset": 2104, "end_offset": 2106, "text": "in", "global_span": [ 3871, 3873 ] }, { "id": 19, "label": "Traditional", "start_offset": 2109, "end_offset": 2121, "text": "stock and on", "global_span": [ 3876, 3888 ] }, { "id": 20, "label": "Traditional", "start_offset": 2124, "end_offset": 2167, "text": "shelf availability rates since the pandemic", "global_span": [ 3891, 3934 ] }, { "id": 21, "label": "Traditional", "start_offset": 2373, "end_offset": 2383, "text": "commitment", "global_span": [ 4140, 4150 ] }, { "id": 22, "label": "Traditional", "start_offset": 2387, "end_offset": 2408, "text": "reduce fixed costs by", "global_span": [ 4154, 4175 ] }, { "id": 23, "label": "Value", "start_offset": 2409, "end_offset": 2435, "text": "approximately $500 million", "global_span": [ 4176, 4202 ] }, { "id": 24, "label": "Traditional", "start_offset": 2442, "end_offset": 2456, "text": "fully realized", "global_span": [ 4209, 4223 ] }, { "id": 25, "label": "Traditional", "start_offset": 2460, "end_offset": 2464, "text": "2024", "global_span": [ 4227, 4231 ] }, { "id": 26, "label": "Traditional", "start_offset": 3791, "end_offset": 3795, "text": "2024", "global_span": [ 5558, 5562 ] }, { "id": 27, "label": "Value", "start_offset": 3810, "end_offset": 3812, "text": "17", "global_span": [ 5577, 5579 ] }, { "id": 28, "label": "Non_Traditional", "start_offset": 3820, "end_offset": 3873, "text": "top Pro markets equipped with new fulfillment options", "global_span": [ 5587, 5640 ] }, { "id": 334, "label": "Traditional", "text": "For fiscal 2023", "start_offset": 179, "end_offset": 194, "global_span": [ 1946, 1961 ] }, { "id": 335, "label": "Traditional", "text": "U.S. stores", "start_offset": 303, "end_offset": 314, "global_span": [ 2070, 2081 ] } ], "relations": [ { "id": 1, "entity_ids": [ 1, 2, 334 ], "description": "Value_of" }, { "id": 2, "entity_ids": [ 1, 3, 4, 334 ], "description": "Value_of" }, { "id": 3, "entity_ids": [ 5, 6, 7 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 8, 9, 335 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 10, 11 ], "description": "Value_of" }, { "id": 6, "entity_ids": [ 10, 12, 13 ], "description": "Value_of" }, { "id": 7, "entity_ids": [ 14, 15, 16 ], "description": "Value_of" }, { "id": 8, "entity_ids": [ 17, 18, 19, 20 ], "description": "Value_of" }, { "id": 9, "entity_ids": [ 21, 22, 23, 24, 25 ], "description": "Value_of" }, { "id": 10, "entity_ids": [ 26, 27, 28 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Ann - Marie Campbell: Thanks, Ted, and good morning, everyone. I could n’t be more pleased with our operational excellence and the investments we continue to make in the business. As you heard from Ted, we remain focused on three main strategic opportunities of creating the best interconnected experience, growing our Pro wallet share through our unique ecosystem of capabilities and build in new stores. As we continue to create the best interconnected experience and remove friction from our customers shopping journey, one of our biggest areas of opportunity is within our post - sale experience. For the majority of our customers, this process has largely been unchanged for the last 44 years, and we have opportunities to improve this experience. In 2023, we made significant progress taking friction out of our online order management process. Today, we have enhanced our systems to better allow our customers to both modify orders and self - service online returns. In 2024, we will focus on building more robust capabilities to support an interconnected self - service returns process where customers will have the ability to start a return online and complete that return via mail or in - store. We have just begun all of this work in earnest and are very excited about the friction we will remove through this process while realizing significant productivity benefits over the long term. Through these enhancements and new capabilities in our returns process, we gain efficiencies by reducing transaction time and improving on - shelf availability, enabling better inventory management. We also improved customer service by allowing the customer to start and complete their return, however they want. As you ' ve heard us say many times, we are focused on making our interconnected experience better and more convenient no matter how our customers choose to engage with us. As we mentioned at our Investor Conference in June, we plan to open approximately 80 new stores over the next five years. Our current network of over 2,300 stores throughout North America makes the Home Depot the most convenient physical destination for customers to shop for their home improvement products. We have a premier real estate footprint that provides convenience for the customer that we believe is nearly impossible to replicate. And we will continue to build out this footprint in a very strategic way by investing in new stores in areas that have experienced significant population growth or where it makes sense to relieve some pressure on existing high - volume stores. In fiscal 2023, we opened 13 new stores. Eight in the U.S. and five in Mexico. In the U.S., our eight new stores were roughly split between stores relieving pressure from higher volume existing stores and stores where we identified void in new high - growth areas. As an example, we are already seeing great results for many of these new stores and are particularly pleased with our Mapunapuna store in Honolulu, which allows us to better serve the Honolulu market. For fiscal 2024, we plan to open approximately 12 new stores. Beyond our focus on removing friction and growing to new stores, we have a lot of initiatives in 2024 geared at growing our share of wallet with the Pro. My new organization will be focused on better enabling alignment so we can more seamlessly deliver on our unique value proposition for all Pros. When we invest in new assets and capabilities to better serve the complex Pro, this also improves our Pro experience in our stores. For example, more job site delivery orders fulfilled from our distribution centers means less congestion in our stores and less time dedicated to picking, packing and staging orders for delivery. This gives our in - store Pro sales associates more time to dedicate to our Pros. Additionally, the ability to fulfill large orders through our distribution network also means that we have more product in stock and available for sale for all those Pros shopping in our stores. These improvements benefit our associates and all of our Pros. Our investments in these strategic initiatives as well as the investments in our associates has set us up for success. Recall that at the beginning of the year, we announced a significant investment of approximately $1 billion in increased annualized compensation for frontline hourly associates. As a result of this investment, we saw what we intended to see meaningful improvement in our attrition rates, particularly among our most tenured associates, which drove improved customer service, productivity and safety. I ' m excited to see all of our initiatives gaining traction, and I want to thank our amazing associates for all that they do. With that, let me turn the call over to Billy.", "ground_truth_output": { "entities": [ { "id": 29, "label": "Non_Traditional", "start_offset": 1949, "end_offset": 1953, "text": "open", "global_span": [ 8226, 8230 ] }, { "id": 30, "label": "Value", "start_offset": 1954, "end_offset": 1970, "text": "approximately 80", "global_span": [ 8231, 8247 ] }, { "id": 31, "label": "Non_Traditional", "start_offset": 1971, "end_offset": 1981, "text": "new stores", "global_span": [ 8248, 8258 ] }, { "id": 32, "label": "Non_Traditional", "start_offset": 1991, "end_offset": 2006, "text": "next five years", "global_span": [ 8268, 8283 ] }, { "id": 33, "label": "Non_Traditional", "start_offset": 2012, "end_offset": 2027, "text": "current network", "global_span": [ 8289, 8304 ] }, { "id": 34, "label": "Value", "start_offset": 2036, "end_offset": 2041, "text": "2,300", "global_span": [ 8313, 8318 ] }, { "id": 35, "label": "Non_Traditional", "start_offset": 2042, "end_offset": 2048, "text": "stores", "global_span": [ 8319, 8325 ] }, { "id": 36, "label": "Non_Traditional", "start_offset": 2060, "end_offset": 2073, "text": "North America", "global_span": [ 8337, 8350 ] }, { "id": 37, "label": "Traditional", "start_offset": 2576, "end_offset": 2587, "text": "fiscal 2023", "global_span": [ 8853, 8864 ] }, { "id": 38, "label": "Traditional", "start_offset": 2592, "end_offset": 2598, "text": "opened", "global_span": [ 8869, 8875 ] }, { "id": 39, "label": "Value", "start_offset": 2599, "end_offset": 2601, "text": "13", "global_span": [ 8876, 8878 ] }, { "id": 40, "label": "Traditional", "start_offset": 2602, "end_offset": 2612, "text": "new stores", "global_span": [ 8879, 8889 ] }, { "id": 41, "label": "Value", "start_offset": 2614, "end_offset": 2619, "text": "Eight", "global_span": [ 8891, 8896 ] }, { "id": 42, "label": "Traditional", "start_offset": 2627, "end_offset": 2631, "text": "U.S.", "global_span": [ 8904, 8908 ] }, { "id": 43, "label": "Value", "start_offset": 2636, "end_offset": 2640, "text": "five", "global_span": [ 8913, 8917 ] }, { "id": 44, "label": "Traditional", "start_offset": 2644, "end_offset": 2650, "text": "Mexico", "global_span": [ 8921, 8927 ] }, { "id": 45, "label": "Traditional", "start_offset": 3043, "end_offset": 3054, "text": "fiscal 2024", "global_span": [ 9320, 9331 ] }, { "id": 46, "label": "Traditional", "start_offset": 3059, "end_offset": 3063, "text": "plan", "global_span": [ 9336, 9340 ] }, { "id": 47, "label": "Traditional", "start_offset": 3067, "end_offset": 3071, "text": "open", "global_span": [ 9344, 9348 ] }, { "id": 48, "label": "Value", "start_offset": 3072, "end_offset": 3088, "text": "approximately 12", "global_span": [ 9349, 9365 ] }, { "id": 49, "label": "Traditional", "start_offset": 3089, "end_offset": 3099, "text": "new stores", "global_span": [ 9366, 9376 ] }, { "id": 50, "label": "Traditional", "start_offset": 4244, "end_offset": 4266, "text": "significant investment", "global_span": [ 10521, 10543 ] }, { "id": 51, "label": "Value", "start_offset": 4270, "end_offset": 4294, "text": "approximately $1 billion", "global_span": [ 10547, 10571 ] }, { "id": 52, "label": "Traditional", "start_offset": 4308, "end_offset": 4331, "text": "annualized compensation", "global_span": [ 10585, 10608 ] }, { "id": 53, "label": "Traditional", "start_offset": 4336, "end_offset": 4363, "text": "frontline hourly associates", "global_span": [ 10613, 10640 ] } ], "relations": [ { "id": 11, "entity_ids": [ 29, 30, 31, 32 ], "description": "Value_of" }, { "id": 12, "entity_ids": [ 33, 34, 35, 36 ], "description": "Value_of" }, { "id": 13, "entity_ids": [ 37, 38, 39, 40 ], "description": "Value_of" }, { "id": 14, "entity_ids": [ 40, 41, 42 ], "description": "Value_of" }, { "id": 15, "entity_ids": [ 40, 43, 44 ], "description": "Value_of" }, { "id": 16, "entity_ids": [ 45, 46, 47, 48, 49 ], "description": "Value_of" }, { "id": 17, "entity_ids": [ 50, 51, 52, 53 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "William Bastek: Thank you, Ann, and good morning, everyone. I want to start by also thanking all of our associates and supplier partners for their ongoing commitment to serving our customers and communities. As you heard from Ted, during the fourth quarter, our sales were largely in line with our expectations. However, we did have some unfavorable impacts from weather in January and core commodity deflation. We saw a continuation of the trend that we ' ve been observing throughout the year, with softness in certain big ticket discretionary type purchases. Our customers continue to take on smaller projects while still deferring larger projects. Turning to our department comp performance for the fourth quarter, our building materials and outdoor garden departments posted positive comps and 6 of our remaining 12 merchandising departments posted comps above the company average, including appliances, plumbing, tools, paint, indoor garden, and hardware. During the fourth quarter, our comp transactions decreased 2.1% and comp average ticket decreased 1.3%. However, we continue to see our customers trading up for new and innovative products. Deflation from core commodity categories negatively impacted our average ticket by 35 basis points during the fourth quarter, driven by deflation in lumber and copper wire. During the fourth quarter, we continued to see, on average, a decline in lumber prices relative to a year ago. However, framing and panel lumber pricing experienced the most stable pricing levels during the quarter in some time. As an example, framing lumber started the quarter at approximately $370 per 1,000 board feet compared to ending the quarter at approximately $395, representing a change of less than 7%. The big ticket comp transactions or those over $1,000, were down 6.9% compared to the fourth quarter of last year. We continued to see softer engagement in big - ticket discretionary categories like flooring, countertops and cabinets. During the fourth quarter, our Pro and DIY customers performance was relatively in line with one another. While internal and external surveys suggest that Pro backlogs are lower than they were a year ago, they have remained stable and elevated relative to historical norms. Turning to total company online sales. Sales leveraging our digital platforms increased approximately 2% compared to the fourth quarter of last year. We continue to enhance our digital customer experience with a number of new capabilities, including an enhanced browsing experience featuring the best sellers in a local market and new product discovery zones, which highlights what 's trending based on new and highly rated products. For those customers that transacted with us online during the fourth quarter, nearly half of our online orders were fulfilled through our stores. During the fourth quarter, we hosted our annual decorative holiday, Gift Center and Black Friday events. We saw strong engagement across all these events with our decorative holiday event posting a record sales year. As Ted mentioned, 2023 marked the year of significant progress for our inventory management and on - shelf availability while effectively navigating a disinflationary pricing environment and maintaining our position as the customer 's advocate for value. Today, we are in a great position regarding our inventory levels. Our in - stocks are the best they ' ve been in a number of years, and we are delivering a compelling assortment for our customers ' home improvement needs. We are looking forward to the year ahead, particularly with the spring selling season right around the corner, and we have a great lineup of new and innovative products in live goods to outdoor power equipment. We 're excited to expand our offering of Pro outdoor tools with the launch of our new cordless battery powered, Milwaukee, M18, backpack blower and straight shaft trimmer, broadening our assortment for the Pro landscaper. And our Spring Gift Center event continues to lean into cordless technology with a wide variety of products from RYOBI, Milwaukee, Makita and DEWALT, many of which are exclusive to the Home Depot and the big box retail channel. We 're also excited about our live goods program. Each year, our merchants partner with our national and regional growers to provide our customers with new and improved varieties to enhance the overall garden experience. We ' ve made significant investments in partnership with our growers to bring new varieties to our customers that are more disease resistant, tolerant to different climates and require less watering. Investing in our relationships with our growers will allow us to continue to drive innovation to meet our customers ' needs and improve their shopping experience while building loyalty to the Home Depot. As we look forward to spring, we 're excited about continuing to provide a broad assortment of best - in - class products that are in stock and available for our customers when and how they need it. With that, I 'd like to turn the call over to Richard.", "ground_truth_output": { "entities": [ { "id": 54, "label": "Traditional", "start_offset": 974, "end_offset": 988, "text": "fourth quarter", "global_span": [ 12011, 12025 ] }, { "id": 55, "label": "Traditional", "start_offset": 994, "end_offset": 1021, "text": "comp transactions decreased", "global_span": [ 12031, 12058 ] }, { "id": 56, "label": "Value", "start_offset": 1022, "end_offset": 1026, "text": "2.1%", "global_span": [ 12059, 12063 ] }, { "id": 57, "label": "Traditional", "start_offset": 1031, "end_offset": 1060, "text": "comp average ticket decreased", "global_span": [ 12068, 12097 ] }, { "id": 58, "label": "Value", "start_offset": 1061, "end_offset": 1065, "text": "1.3%", "global_span": [ 12098, 12102 ] }, { "id": 59, "label": "Traditional", "start_offset": 1194, "end_offset": 1204, "text": "negatively", "global_span": [ 12231, 12241 ] }, { "id": 60, "label": "Traditional", "start_offset": 1218, "end_offset": 1232, "text": "average ticket", "global_span": [ 12255, 12269 ] }, { "id": 61, "label": "Value", "start_offset": 1236, "end_offset": 1238, "text": "35", "global_span": [ 12273, 12275 ] }, { "id": 62, "label": "Traditional", "start_offset": 1239, "end_offset": 1251, "text": "basis points", "global_span": [ 12276, 12288 ] }, { "id": 63, "label": "Traditional", "start_offset": 1263, "end_offset": 1277, "text": "fourth quarter", "global_span": [ 12300, 12314 ] }, { "id": 64, "label": "Traditional", "start_offset": 1570, "end_offset": 1592, "text": "framing lumber started", "global_span": [ 12607, 12629 ] }, { "id": 65, "label": "Traditional", "start_offset": 1597, "end_offset": 1604, "text": "quarter", "global_span": [ 12634, 12641 ] }, { "id": 66, "label": "Value", "start_offset": 1608, "end_offset": 1636, "text": "approximately $370 per 1,000", "global_span": [ 12645, 12673 ] }, { "id": 67, "label": "Traditional", "start_offset": 1637, "end_offset": 1656, "text": "board feet compared", "global_span": [ 12674, 12693 ] }, { "id": 68, "label": "Traditional", "start_offset": 1660, "end_offset": 1678, "text": "ending the quarter", "global_span": [ 12697, 12715 ] }, { "id": 69, "label": "Value", "start_offset": 1682, "end_offset": 1700, "text": "approximately $395", "global_span": [ 12719, 12737 ] }, { "id": 70, "label": "Traditional", "start_offset": 1717, "end_offset": 1723, "text": "change", "global_span": [ 12754, 12760 ] }, { "id": 71, "label": "Value", "start_offset": 1727, "end_offset": 1739, "text": "less than 7%", "global_span": [ 12764, 12776 ] }, { "id": 72, "label": "Traditional", "start_offset": 1745, "end_offset": 1773, "text": "big ticket comp transactions", "global_span": [ 12782, 12810 ] }, { "id": 73, "label": "Value", "start_offset": 1783, "end_offset": 1794, "text": "over $1,000", "global_span": [ 12820, 12831 ] }, { "id": 74, "label": "Value", "start_offset": 1806, "end_offset": 1810, "text": "6.9%", "global_span": [ 12843, 12847 ] }, { "id": 75, "label": "Traditional", "start_offset": 1811, "end_offset": 1819, "text": "compared", "global_span": [ 12848, 12856 ] }, { "id": 76, "label": "Traditional", "start_offset": 1827, "end_offset": 1841, "text": "fourth quarter", "global_span": [ 12864, 12878 ] }, { "id": 77, "label": "Traditional", "start_offset": 1845, "end_offset": 1854, "text": "last year", "global_span": [ 12882, 12891 ] }, { "id": 78, "label": "Value", "start_offset": 1876, "end_offset": 1893, "text": "softer engagement", "global_span": [ 12913, 12930 ] }, { "id": 79, "label": "Traditional", "start_offset": 1897, "end_offset": 1900, "text": "big", "global_span": [ 12934, 12937 ] }, { "id": 80, "label": "Traditional", "start_offset": 1903, "end_offset": 1934, "text": "ticket discretionary categories", "global_span": [ 12940, 12971 ] }, { "id": 81, "label": "Traditional", "start_offset": 1940, "end_offset": 1948, "text": "flooring", "global_span": [ 12977, 12985 ] }, { "id": 82, "label": "Traditional", "start_offset": 1950, "end_offset": 1961, "text": "countertops", "global_span": [ 12987, 12998 ] }, { "id": 83, "label": "Traditional", "start_offset": 1966, "end_offset": 1974, "text": "cabinets", "global_span": [ 13003, 13011 ] }, { "id": 84, "label": "Non_Traditional", "start_offset": 2007, "end_offset": 2010, "text": "Pro", "global_span": [ 13044, 13047 ] }, { "id": 85, "label": "Non_Traditional", "start_offset": 2015, "end_offset": 2040, "text": "DIY customers performance", "global_span": [ 13052, 13077 ] }, { "id": 86, "label": "Value", "start_offset": 2056, "end_offset": 2080, "text": "in line with one another", "global_span": [ 13093, 13117 ] }, { "id": 87, "label": "Non_Traditional", "start_offset": 2131, "end_offset": 2143, "text": "Pro backlogs", "global_span": [ 13168, 13180 ] }, { "id": 88, "label": "Value", "start_offset": 2148, "end_offset": 2153, "text": "lower", "global_span": [ 13185, 13190 ] }, { "id": 89, "label": "Traditional", "start_offset": 2289, "end_offset": 2337, "text": "Sales leveraging our digital platforms increased", "global_span": [ 13326, 13374 ] }, { "id": 90, "label": "Value", "start_offset": 2338, "end_offset": 2354, "text": "approximately 2%", "global_span": [ 13375, 13391 ] }, { "id": 91, "label": "Value", "start_offset": 3753, "end_offset": 3759, "text": "expand", "global_span": [ 14790, 14796 ] }, { "id": 92, "label": "Non_Traditional", "start_offset": 3776, "end_offset": 3787, "text": "Pro outdoor", "global_span": [ 14813, 14824 ] }, { "id": 93, "label": "Value", "start_offset": 3803, "end_offset": 3809, "text": "launch", "global_span": [ 14840, 14846 ] }, { "id": 94, "label": "Non_Traditional", "start_offset": 3821, "end_offset": 3845, "text": "cordless battery powered", "global_span": [ 14858, 14882 ] }, { "id": 95, "label": "Non_Traditional", "start_offset": 3847, "end_offset": 3856, "text": "Milwaukee", "global_span": [ 14884, 14893 ] }, { "id": 96, "label": "Non_Traditional", "start_offset": 3858, "end_offset": 3861, "text": "M18", "global_span": [ 14895, 14898 ] }, { "id": 97, "label": "Non_Traditional", "start_offset": 3863, "end_offset": 3878, "text": "backpack blower", "global_span": [ 14900, 14915 ] }, { "id": 98, "label": "Non_Traditional", "start_offset": 3883, "end_offset": 3905, "text": "straight shaft trimmer", "global_span": [ 14920, 14942 ] } ], "relations": [ { "id": 18, "entity_ids": [ 54, 55, 56 ], "description": "Value_of" }, { "id": 19, "entity_ids": [ 54, 57, 58 ], "description": "Value_of" }, { "id": 20, "entity_ids": [ 59, 60, 61, 62, 63 ], "description": "Value_of" }, { "id": 21, "entity_ids": [ 64, 65, 66, 67 ], "description": "Value_of" }, { "id": 22, "entity_ids": [ 64, 65, 68, 69 ], "description": "Value_of" }, { "id": 23, "entity_ids": [ 64, 70, 71 ], "description": "Value_of" }, { "id": 24, "entity_ids": [ 72, 73, 74, 75, 76, 77 ], "description": "Value_of" }, { "id": 25, "entity_ids": [ 78, 79, 80, 81, 82, 83 ], "description": "Value_of" }, { "id": 26, "entity_ids": [ 84, 85, 86 ], "description": "Value_of" }, { "id": 27, "entity_ids": [ 87, 88 ], "description": "Value_of" }, { "id": 28, "entity_ids": [ 89, 90 ], "description": "Value_of" }, { "id": 29, "entity_ids": [ 91, 92, 93, 94, 95, 96, 97, 98 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Richard McPhail: Thank you, Billy, and good morning, everyone. In the fourth quarter, total sales were $34.8 billion, a decrease of 2.9% from last year. During the fourth quarter, our total company comps were negative 3.5% with comps of negative 2.5% in November, positive 1.1% in December and negative 8.5% in January. Comps in the U.S. were negative 4% for the quarter with comps of negative 2.7% in November, positive 0.6% in December and negative 9.1% in January. In local currency, Mexico and Canada posted comps above the company average with Mexico posting positive comps. It is important to note that adjusting for holiday shifts and weather - related impacts in January, monthly comps relatively consistent across the quarter. For the year, our sales totaled $152.7 billion, a decrease of 3% versus fiscal 2022. For the year, total company comp sales decreased 3.2% and U.S. comp sales decreased 3.5%. In the fourth quarter, our gross margin was approximately 33.1%, a decrease of 20 basis points from last year. For the year, our gross margin was approximately 33.4%, a decrease of 15 basis points from last year, which was in line with our expectations. During the fourth quarter, operating expenses as a percentage of sales increased approximately 115 basis points to 21.2% compared to the fourth quarter of 2022. Our operating expense performance during the fourth quarter reflects our previously executed compensation increases for hourly associates as well as deleverage from our top line results. For the year, operating expenses were approximately 19.2% of sales, representing an increase of approximately 90 basis points from fiscal 2022. Our operating margin for the fourth quarter was approximately 11.9% and for the year was approximately 14.2%. Interest and other expense for the fourth quarter increased by $50 million to $458 million. In the fourth quarter and for fiscal 2023, our effective tax rate was 24%. Our diluted earnings per share for the fourth quarter were $2.82, a decrease of 14.5% compared to the fourth quarter of 2022. Diluted earnings per share for fiscal 2023 were $15.11, a decrease of 9.5% compared to fiscal 2022. At the end of the quarter, merchandise inventories were $21 billion, down $3.9 billion or approximately 16% versus last year, and inventory turns were 4.3x, up from 4.2x from the second period last year. Moving on to capital allocation. During the fourth quarter, we invested approximately $860 million back into our business in the form of capital expenditures. This brings total capital expenditures for fiscal 2023 to approximately $3.2 billion. During the year, we opened 13 new stores, bringing our store count to 2,335 at the end of fiscal 2023. Retail selling square footage was approximately 242 million square feet and total sales per retail square foot were approximately $605 in fiscal 2023. Additionally, we invested approximately $1.5 billion on three acquisitions during fiscal 2023, accelerating our strategic initiatives and providing us with better capabilities to serve our customers. During the year, we paid approximately $8.4 billion of dividends to our shareholders. Today, we announced our Board of Directors increased our quarterly dividend by 7.7% to $2.25 per share, which equates to an annual dividend of $9 per share. And finally, during fiscal 2023, we returned approximately $8 billion to our shareholders in the form of share repurchases, including $1.5 billion in the fourth quarter. Computed on the average of beginning and ending long - term debt and equity for the trailing 12 months, return on invested capital was 36.7% compared to 44.6% at the end of the fourth quarter of fiscal 2022. Now I 'll comment on our outlook for 2024. First, let me point out that fiscal 2024 will include a 53rd week, so the fourth quarter of fiscal 2024 will consist of 14 weeks. We will continue to report comps on a 52 - week basis, but we will base our overall guidance on 53 weeks. As you heard from Ted, we feel great about the actions we took in 2023 to position us well heading into 2024. And while there are signs that the economy is on the way towards normalization, the home improvement market still faces headwinds as we look ahead to fiscal 2024. We considered several factors that informed our outlook for fiscal 2024. On the positive side, we faced a number of pressures in fiscal 2023 that are unlikely to repeat in fiscal 2024. In 2023, we saw four increases in the Fed funds rate, a sharp decline in existing home sales and approximately 110 basis points of comp pressure from lumber deflation. However, we still expect pressures to our business in fiscal 2024. Personal consumption growth as measured by PCE is expected to decelerate compared to 2023. Our share of PCE also remains slightly elevated relative to 2019 and has been on a glide path towards 2019 levels. Higher interest rates at the beginning of 2024 relative to last year will likely continue to pressure demand for larger projects. And the effects from pull forward of demand during the pandemic as well as some project deferral could impact demand into 2024. As we consider these influences on home improvement demand, we are planning for a year of continued moderation but with slightly less pressure to comp sales than what we faced in fiscal 2023. Our fiscal 2024 outlook is for total sales growth to outpace sales comp with sales growth of approximately positive 1% and comp sales of approximately negative 1% compared to fiscal 2023. Total sales growth will benefit from a 53rd week as well as from the acquisitions we made and the new stores we opened in fiscal 2023 and the stores we plan to open in fiscal 2024. We expect the 53rd week will contribute approximately $2.3 billion in sales. Our gross margin is expected to be approximately 33.9%, an increase of approximately 50 basis points compared to fiscal 2023. This primarily reflects a lower product and transportation cost environment relative to fiscal 2023 as well as benefits from a portion of the approximately $500 million in reduced fixed costs that we will realize in fiscal 2024. Further, we expect operating margin of approximately 14.1%. This reflects deleverage from sales and pressure from targeted incentive compensation as we are overlapping lower incentive compensation paid than planned in 2023. This will be partially offset by the benefits from the approximately $500 million in fixed costs that we will realize in fiscal 2024 in both cost of goods sold and operating expenses. Our effective tax rate is targeted at approximately 24.5%. We expect net interest expense of approximately $1.8 billion. Our diluted earnings per share percent growth is targeted to be approximately 1% compared to fiscal 2023, with the extra week contributing approximately $0.30. We plan to continue investing in our business with capital expenditures of approximately 2% of sales on an annual basis. After investing in our business and paying our dividend, it is our intent to return excess cash to shareholders in the form of share repurchases. We believe we have positioned ourselves to meet the needs of our customers in any environment. The investments we ' ve made in our business have enabled agility in our operating model. As we look forward, we will continue to invest to strengthen our position with our customers, leverage our scale and low - cost position to drive growth faster than the market and deliver shareholder value. Thank you for your participation in today 's call. And Christine, we are now ready for questions.", "ground_truth_output": { "entities": [ { "id": 99, "label": "Traditional", "start_offset": 71, "end_offset": 85, "text": "fourth quarter", "global_span": [ 16171, 16185 ] }, { "id": 100, "label": "Traditional", "start_offset": 87, "end_offset": 98, "text": "total sales", "global_span": [ 16187, 16198 ] }, { "id": 101, "label": "Value", "start_offset": 104, "end_offset": 117, "text": "$34.8 billion", "global_span": [ 16204, 16217 ] }, { "id": 102, "label": "Traditional", "start_offset": 121, "end_offset": 129, "text": "decrease", "global_span": [ 16221, 16229 ] }, { "id": 103, "label": "Value", "start_offset": 133, "end_offset": 137, "text": "2.9%", "global_span": [ 16233, 16237 ] }, { "id": 104, "label": "Traditional", "start_offset": 143, "end_offset": 152, "text": "last year", "global_span": [ 16243, 16252 ] }, { "id": 105, "label": "Traditional", "start_offset": 165, "end_offset": 179, "text": "fourth quarter", "global_span": [ 16265, 16279 ] }, { "id": 106, "label": "Traditional", "start_offset": 185, "end_offset": 204, "text": "total company comps", "global_span": [ 16285, 16304 ] }, { "id": 107, "label": "Value", "start_offset": 210, "end_offset": 223, "text": "negative 3.5%", "global_span": [ 16310, 16323 ] }, { "id": 108, "label": "Value", "start_offset": 238, "end_offset": 251, "text": "negative 2.5%", "global_span": [ 16338, 16351 ] }, { "id": 109, "label": "Value", "start_offset": 265, "end_offset": 278, "text": "positive 1.1%", "global_span": [ 16365, 16378 ] }, { "id": 110, "label": "Traditional", "start_offset": 282, "end_offset": 290, "text": "December", "global_span": [ 16382, 16390 ] }, { "id": 111, "label": "Value", "start_offset": 295, "end_offset": 308, "text": "negative 8.5%", "global_span": [ 16395, 16408 ] }, { "id": 112, "label": "Traditional", "start_offset": 312, "end_offset": 319, "text": "January", "global_span": [ 16412, 16419 ] }, { "id": 113, "label": "Traditional", "start_offset": 321, "end_offset": 338, "text": "Comps in the U.S.", "global_span": [ 16421, 16438 ] }, { "id": 114, "label": "Value", "start_offset": 344, "end_offset": 355, "text": "negative 4%", "global_span": [ 16444, 16455 ] }, { "id": 115, "label": "Traditional", "start_offset": 364, "end_offset": 371, "text": "quarter", "global_span": [ 16464, 16471 ] }, { "id": 116, "label": "Traditional", "start_offset": 377, "end_offset": 382, "text": "comps", "global_span": [ 16477, 16482 ] }, { "id": 117, "label": "Value", "start_offset": 386, "end_offset": 399, "text": "negative 2.7%", "global_span": [ 16486, 16499 ] }, { "id": 118, "label": "Traditional", "start_offset": 403, "end_offset": 411, "text": "November", "global_span": [ 16503, 16511 ] }, { "id": 119, "label": "Value", "start_offset": 413, "end_offset": 426, "text": "positive 0.6%", "global_span": [ 16513, 16526 ] }, { "id": 120, "label": "Value", "start_offset": 443, "end_offset": 456, "text": "negative 9.1%", "global_span": [ 16543, 16556 ] }, { "id": 121, "label": "Traditional", "start_offset": 460, "end_offset": 467, "text": "January", "global_span": [ 16560, 16567 ] }, { "id": 122, "label": "Traditional", "start_offset": 469, "end_offset": 486, "text": "In local currency", "global_span": [ 16569, 16586 ] }, { "id": 123, "label": "Traditional", "start_offset": 488, "end_offset": 518, "text": "Mexico and Canada posted comps", "global_span": [ 16588, 16618 ] }, { "id": 124, "label": "Value", "start_offset": 519, "end_offset": 544, "text": "above the company average", "global_span": [ 16619, 16644 ] }, { "id": 125, "label": "Traditional", "start_offset": 550, "end_offset": 564, "text": "Mexico posting", "global_span": [ 16650, 16664 ] }, { "id": 126, "label": "Value", "start_offset": 565, "end_offset": 573, "text": "positive", "global_span": [ 16665, 16673 ] }, { "id": 127, "label": "Traditional", "start_offset": 574, "end_offset": 579, "text": "comps", "global_span": [ 16674, 16679 ] }, { "id": 128, "label": "Traditional", "start_offset": 755, "end_offset": 768, "text": "sales totaled", "global_span": [ 16855, 16868 ] }, { "id": 129, "label": "Value", "start_offset": 769, "end_offset": 783, "text": "$152.7 billion", "global_span": [ 16869, 16883 ] }, { "id": 130, "label": "Value", "start_offset": 787, "end_offset": 795, "text": "decrease", "global_span": [ 16887, 16895 ] }, { "id": 131, "label": "Value", "start_offset": 799, "end_offset": 801, "text": "3%", "global_span": [ 16899, 16901 ] }, { "id": 132, "label": "Traditional", "start_offset": 842, "end_offset": 860, "text": "company comp sales", "global_span": [ 16942, 16960 ] }, { "id": 133, "label": "Value", "start_offset": 861, "end_offset": 875, "text": "decreased 3.2%", "global_span": [ 16961, 16975 ] }, { "id": 134, "label": "Traditional", "start_offset": 880, "end_offset": 895, "text": "U.S. comp sales", "global_span": [ 16980, 16995 ] }, { "id": 135, "label": "Value", "start_offset": 896, "end_offset": 910, "text": "decreased 3.5%", "global_span": [ 16996, 17010 ] }, { "id": 136, "label": "Traditional", "start_offset": 919, "end_offset": 933, "text": "fourth quarter", "global_span": [ 17019, 17033 ] }, { "id": 137, "label": "Traditional", "start_offset": 939, "end_offset": 951, "text": "gross margin", "global_span": [ 17039, 17051 ] }, { "id": 138, "label": "Value", "start_offset": 956, "end_offset": 975, "text": "approximately 33.1%", "global_span": [ 17056, 17075 ] }, { "id": 139, "label": "Value", "start_offset": 979, "end_offset": 1006, "text": "decrease of 20 basis points", "global_span": [ 17079, 17106 ] }, { "id": 140, "label": "Traditional", "start_offset": 1012, "end_offset": 1021, "text": "last year", "global_span": [ 17112, 17121 ] }, { "id": 141, "label": "Traditional", "start_offset": 1041, "end_offset": 1053, "text": "gross margin", "global_span": [ 17141, 17153 ] }, { "id": 142, "label": "Value", "start_offset": 1058, "end_offset": 1077, "text": "approximately 33.4%", "global_span": [ 17158, 17177 ] }, { "id": 143, "label": "Value", "start_offset": 1081, "end_offset": 1089, "text": "decrease", "global_span": [ 17181, 17189 ] }, { "id": 144, "label": "Value", "start_offset": 1093, "end_offset": 1108, "text": "15 basis points", "global_span": [ 17193, 17208 ] }, { "id": 145, "label": "Traditional", "start_offset": 1114, "end_offset": 1123, "text": "last year", "global_span": [ 17214, 17223 ] }, { "id": 146, "label": "Traditional", "start_offset": 1177, "end_offset": 1191, "text": "fourth quarter", "global_span": [ 17277, 17291 ] }, { "id": 147, "label": "Traditional", "start_offset": 1193, "end_offset": 1236, "text": "operating expenses as a percentage of sales", "global_span": [ 17293, 17336 ] }, { "id": 148, "label": "Value", "start_offset": 1237, "end_offset": 1286, "text": "increased approximately 115 basis points to 21.2%", "global_span": [ 17337, 17386 ] }, { "id": 149, "label": "Traditional", "start_offset": 1303, "end_offset": 1317, "text": "fourth quarter", "global_span": [ 17403, 17417 ] }, { "id": 150, "label": "Traditional", "start_offset": 1321, "end_offset": 1325, "text": "2022", "global_span": [ 17421, 17425 ] }, { "id": 151, "label": "Traditional", "start_offset": 1528, "end_offset": 1546, "text": "operating expenses", "global_span": [ 17628, 17646 ] }, { "id": 152, "label": "Value", "start_offset": 1552, "end_offset": 1571, "text": "approximately 19.2%", "global_span": [ 17652, 17671 ] }, { "id": 153, "label": "Traditional", "start_offset": 1575, "end_offset": 1580, "text": "sales", "global_span": [ 17675, 17680 ] }, { "id": 154, "label": "Traditional", "start_offset": 1598, "end_offset": 1606, "text": "increase", "global_span": [ 17698, 17706 ] }, { "id": 155, "label": "Value", "start_offset": 1610, "end_offset": 1639, "text": "approximately 90 basis points", "global_span": [ 17710, 17739 ] }, { "id": 156, "label": "Traditional", "start_offset": 1662, "end_offset": 1678, "text": "operating margin", "global_span": [ 17762, 17778 ] }, { "id": 157, "label": "Traditional", "start_offset": 1687, "end_offset": 1701, "text": "fourth quarter", "global_span": [ 17787, 17801 ] }, { "id": 158, "label": "Value", "start_offset": 1706, "end_offset": 1725, "text": "approximately 11.9%", "global_span": [ 17806, 17825 ] }, { "id": 159, "label": "Value", "start_offset": 1747, "end_offset": 1766, "text": "approximately 14.2%", "global_span": [ 17847, 17866 ] }, { "id": 160, "label": "Value", "start_offset": 1831, "end_offset": 1842, "text": "$50 million", "global_span": [ 17931, 17942 ] }, { "id": 161, "label": "Value", "start_offset": 1846, "end_offset": 1858, "text": "$458 million", "global_span": [ 17946, 17958 ] }, { "id": 162, "label": "Traditional", "start_offset": 1907, "end_offset": 1925, "text": "effective tax rate", "global_span": [ 18007, 18025 ] }, { "id": 163, "label": "Value", "start_offset": 1930, "end_offset": 1933, "text": "24%", "global_span": [ 18030, 18033 ] }, { "id": 164, "label": "Traditional", "start_offset": 1939, "end_offset": 1965, "text": "diluted earnings per share", "global_span": [ 18039, 18065 ] }, { "id": 165, "label": "Traditional", "start_offset": 1974, "end_offset": 1988, "text": "fourth quarter", "global_span": [ 18074, 18088 ] }, { "id": 166, "label": "Value", "start_offset": 1994, "end_offset": 1999, "text": "$2.82", "global_span": [ 18094, 18099 ] }, { "id": 167, "label": "Value", "start_offset": 2003, "end_offset": 2011, "text": "decrease", "global_span": [ 18103, 18111 ] }, { "id": 168, "label": "Value", "start_offset": 2015, "end_offset": 2020, "text": "14.5%", "global_span": [ 18115, 18120 ] }, { "id": 169, "label": "Traditional", "start_offset": 2061, "end_offset": 2087, "text": "Diluted earnings per share", "global_span": [ 18161, 18187 ] }, { "id": 170, "label": "Traditional", "start_offset": 2099, "end_offset": 2103, "text": "2023", "global_span": [ 18199, 18203 ] }, { "id": 171, "label": "Value", "start_offset": 2109, "end_offset": 2115, "text": "$15.11", "global_span": [ 18209, 18215 ] }, { "id": 172, "label": "Value", "start_offset": 2119, "end_offset": 2127, "text": "decrease", "global_span": [ 18219, 18227 ] }, { "id": 173, "label": "Value", "start_offset": 2131, "end_offset": 2135, "text": "9.5%", "global_span": [ 18231, 18235 ] }, { "id": 174, "label": "Traditional", "start_offset": 2188, "end_offset": 2211, "text": "merchandise inventories", "global_span": [ 18288, 18311 ] }, { "id": 175, "label": "Value", "start_offset": 2217, "end_offset": 2228, "text": "$21 billion", "global_span": [ 18317, 18328 ] }, { "id": 176, "label": "Value", "start_offset": 2230, "end_offset": 2247, "text": "down $3.9 billion", "global_span": [ 18330, 18347 ] }, { "id": 177, "label": "Value", "start_offset": 2251, "end_offset": 2268, "text": "approximately 16%", "global_span": [ 18351, 18368 ] }, { "id": 178, "label": "Traditional", "start_offset": 2291, "end_offset": 2306, "text": "inventory turns", "global_span": [ 18391, 18406 ] }, { "id": 179, "label": "Value", "start_offset": 2312, "end_offset": 2316, "text": "4.3x", "global_span": [ 18412, 18416 ] }, { "id": 180, "label": "Traditional", "start_offset": 2409, "end_offset": 2423, "text": "fourth quarter", "global_span": [ 18509, 18523 ] }, { "id": 181, "label": "Traditional", "start_offset": 2428, "end_offset": 2436, "text": "invested", "global_span": [ 18528, 18536 ] }, { "id": 182, "label": "Value", "start_offset": 2451, "end_offset": 2463, "text": "$860 million", "global_span": [ 18551, 18563 ] }, { "id": 183, "label": "Traditional", "start_offset": 2502, "end_offset": 2522, "text": "capital expenditures", "global_span": [ 18602, 18622 ] }, { "id": 184, "label": "Traditional", "start_offset": 2542, "end_offset": 2562, "text": "capital expenditures", "global_span": [ 18642, 18662 ] }, { "id": 185, "label": "Traditional", "start_offset": 2574, "end_offset": 2578, "text": "2023", "global_span": [ 18674, 18678 ] }, { "id": 186, "label": "Value", "start_offset": 2582, "end_offset": 2608, "text": "approximately $3.2 billion", "global_span": [ 18682, 18708 ] }, { "id": 187, "label": "Non_Traditional", "start_offset": 2630, "end_offset": 2636, "text": "opened", "global_span": [ 18730, 18736 ] }, { "id": 188, "label": "Value", "start_offset": 2637, "end_offset": 2639, "text": "13", "global_span": [ 18737, 18739 ] }, { "id": 189, "label": "Non_Traditional", "start_offset": 2640, "end_offset": 2650, "text": "new stores", "global_span": [ 18740, 18750 ] }, { "id": 190, "label": "Non_Traditional", "start_offset": 2665, "end_offset": 2676, "text": "store count", "global_span": [ 18765, 18776 ] }, { "id": 191, "label": "Value", "start_offset": 2680, "end_offset": 2685, "text": "2,335", "global_span": [ 18780, 18785 ] }, { "id": 192, "label": "Non_Traditional", "start_offset": 2700, "end_offset": 2711, "text": "fiscal 2023", "global_span": [ 18800, 18811 ] }, { "id": 193, "label": "Traditional", "start_offset": 2713, "end_offset": 2742, "text": "Retail selling square footage", "global_span": [ 18813, 18842 ] }, { "id": 194, "label": "Value", "start_offset": 2747, "end_offset": 2784, "text": "approximately 242 million square feet", "global_span": [ 18847, 18884 ] }, { "id": 195, "label": "Traditional", "start_offset": 2789, "end_offset": 2842, "text": "total sales per retail square foot were approximately", "global_span": [ 18889, 18942 ] }, { "id": 196, "label": "Value", "start_offset": 2843, "end_offset": 2847, "text": "$605", "global_span": [ 18943, 18947 ] }, { "id": 197, "label": "Traditional", "start_offset": 2851, "end_offset": 2862, "text": "fiscal 2023", "global_span": [ 18951, 18962 ] }, { "id": 198, "label": "Traditional", "start_offset": 2881, "end_offset": 2889, "text": "invested", "global_span": [ 18981, 18989 ] }, { "id": 199, "label": "Value", "start_offset": 2890, "end_offset": 2916, "text": "approximately $1.5 billion", "global_span": [ 18990, 19016 ] }, { "id": 200, "label": "Value", "start_offset": 2920, "end_offset": 2925, "text": "three", "global_span": [ 19020, 19025 ] }, { "id": 201, "label": "Traditional", "start_offset": 2926, "end_offset": 2938, "text": "acquisitions", "global_span": [ 19026, 19038 ] }, { "id": 202, "label": "Value", "start_offset": 3089, "end_offset": 3115, "text": "approximately $8.4 billion", "global_span": [ 19189, 19215 ] }, { "id": 203, "label": "Traditional", "start_offset": 3119, "end_offset": 3148, "text": "dividends to our shareholders", "global_span": [ 19219, 19248 ] }, { "id": 204, "label": "Traditional", "start_offset": 3207, "end_offset": 3225, "text": "quarterly dividend", "global_span": [ 19307, 19325 ] }, { "id": 205, "label": "Value", "start_offset": 3229, "end_offset": 3242, "text": "7.7% to $2.25", "global_span": [ 19329, 19342 ] }, { "id": 206, "label": "Traditional", "start_offset": 3243, "end_offset": 3252, "text": "per share", "global_span": [ 19343, 19352 ] }, { "id": 207, "label": "Traditional", "start_offset": 3274, "end_offset": 3289, "text": "annual dividend", "global_span": [ 19374, 19389 ] }, { "id": 208, "label": "Value", "start_offset": 3290, "end_offset": 3305, "text": "of $9 per share", "global_span": [ 19390, 19405 ] }, { "id": 209, "label": "Traditional", "start_offset": 3327, "end_offset": 3338, "text": "fiscal 2023", "global_span": [ 19427, 19438 ] }, { "id": 210, "label": "Traditional", "start_offset": 3343, "end_offset": 3351, "text": "returned", "global_span": [ 19443, 19451 ] }, { "id": 211, "label": "Value", "start_offset": 3352, "end_offset": 3376, "text": "approximately $8 billion", "global_span": [ 19452, 19476 ] }, { "id": 212, "label": "Traditional", "start_offset": 3380, "end_offset": 3396, "text": "our shareholders", "global_span": [ 19480, 19496 ] }, { "id": 213, "label": "Traditional", "start_offset": 3412, "end_offset": 3429, "text": "share repurchases", "global_span": [ 19512, 19529 ] }, { "id": 214, "label": "Value", "start_offset": 3441, "end_offset": 3453, "text": "$1.5 billion", "global_span": [ 19541, 19553 ] }, { "id": 215, "label": "Traditional", "start_offset": 3461, "end_offset": 3475, "text": "fourth quarter", "global_span": [ 19561, 19575 ] }, { "id": 216, "label": "Traditional", "start_offset": 3581, "end_offset": 3607, "text": "return on invested capital", "global_span": [ 19681, 19707 ] }, { "id": 217, "label": "Value", "start_offset": 3612, "end_offset": 3617, "text": "36.7%", "global_span": [ 19712, 19717 ] }, { "id": 218, "label": "Value", "start_offset": 3630, "end_offset": 3635, "text": "44.6%", "global_span": [ 19730, 19735 ] }, { "id": 219, "label": "Traditional", "start_offset": 3643, "end_offset": 3646, "text": "end", "global_span": [ 19743, 19746 ] }, { "id": 220, "label": "Traditional", "start_offset": 3654, "end_offset": 3668, "text": "fourth quarter", "global_span": [ 19754, 19768 ] }, { "id": 221, "label": "Traditional", "start_offset": 3672, "end_offset": 3683, "text": "fiscal 2022", "global_span": [ 19772, 19783 ] }, { "id": 222, "label": "Value", "start_offset": 4519, "end_offset": 4549, "text": "approximately 110 basis points", "global_span": [ 20619, 20649 ] }, { "id": 223, "label": "Traditional", "start_offset": 4553, "end_offset": 4566, "text": "comp pressure", "global_span": [ 20653, 20666 ] }, { "id": 224, "label": "Traditional", "start_offset": 4572, "end_offset": 4588, "text": "lumber deflation", "global_span": [ 20672, 20688 ] }, { "id": 225, "label": "Traditional", "start_offset": 4657, "end_offset": 4715, "text": "Personal consumption growth as measured by PCE is expected", "global_span": [ 20757, 20815 ] }, { "id": 226, "label": "Value", "start_offset": 4719, "end_offset": 4729, "text": "decelerate", "global_span": [ 20819, 20829 ] }, { "id": 227, "label": "Traditional", "start_offset": 4730, "end_offset": 4746, "text": "compared to 2023", "global_span": [ 20830, 20846 ] }, { "id": 228, "label": "Traditional", "start_offset": 4748, "end_offset": 4764, "text": "Our share of PCE", "global_span": [ 20848, 20864 ] }, { "id": 229, "label": "Value", "start_offset": 4778, "end_offset": 4795, "text": "slightly elevated", "global_span": [ 20878, 20895 ] }, { "id": 230, "label": "Traditional", "start_offset": 4796, "end_offset": 4812, "text": "relative to 2019", "global_span": [ 20896, 20912 ] }, { "id": 231, "label": "Value", "start_offset": 5241, "end_offset": 5263, "text": "slightly less pressure", "global_span": [ 21341, 21363 ] }, { "id": 232, "label": "Traditional", "start_offset": 5267, "end_offset": 5311, "text": "comp sales than what we faced in fiscal 2023", "global_span": [ 21367, 21411 ] }, { "id": 233, "label": "Traditional", "start_offset": 5317, "end_offset": 5336, "text": "fiscal 2024 outlook", "global_span": [ 21417, 21436 ] }, { "id": 234, "label": "Traditional", "start_offset": 5344, "end_offset": 5362, "text": "total sales growth", "global_span": [ 21444, 21462 ] }, { "id": 235, "label": "Traditional", "start_offset": 5366, "end_offset": 5384, "text": "outpace sales comp", "global_span": [ 21466, 21484 ] }, { "id": 236, "label": "Traditional", "start_offset": 5390, "end_offset": 5402, "text": "sales growth", "global_span": [ 21490, 21502 ] }, { "id": 237, "label": "Value", "start_offset": 5406, "end_offset": 5431, "text": "approximately positive 1%", "global_span": [ 21506, 21531 ] }, { "id": 238, "label": "Traditional", "start_offset": 5436, "end_offset": 5446, "text": "comp sales", "global_span": [ 21536, 21546 ] }, { "id": 239, "label": "Value", "start_offset": 5450, "end_offset": 5475, "text": "approximately negative 1%", "global_span": [ 21550, 21575 ] }, { "id": 240, "label": "Traditional", "start_offset": 5501, "end_offset": 5519, "text": "Total sales growth", "global_span": [ 21601, 21619 ] }, { "id": 241, "label": "Value", "start_offset": 5722, "end_offset": 5748, "text": "approximately $2.3 billion", "global_span": [ 21822, 21848 ] }, { "id": 242, "label": "Traditional", "start_offset": 5752, "end_offset": 5757, "text": "sales", "global_span": [ 21852, 21857 ] }, { "id": 243, "label": "Traditional", "start_offset": 5759, "end_offset": 5775, "text": "Our gross margin", "global_span": [ 21859, 21875 ] }, { "id": 244, "label": "Traditional", "start_offset": 5779, "end_offset": 5787, "text": "expected", "global_span": [ 21879, 21887 ] }, { "id": 245, "label": "Value", "start_offset": 5794, "end_offset": 5813, "text": "approximately 33.9%", "global_span": [ 21894, 21913 ] }, { "id": 246, "label": "Value", "start_offset": 5818, "end_offset": 5826, "text": "increase", "global_span": [ 21918, 21926 ] }, { "id": 247, "label": "Value", "start_offset": 5830, "end_offset": 5859, "text": "approximately 50 basis points", "global_span": [ 21930, 21959 ] }, { "id": 248, "label": "Traditional", "start_offset": 5872, "end_offset": 5883, "text": "fiscal 2023", "global_span": [ 21972, 21983 ] }, { "id": 249, "label": "Value", "start_offset": 5911, "end_offset": 5916, "text": "lower", "global_span": [ 22011, 22016 ] }, { "id": 250, "label": "Traditional", "start_offset": 5917, "end_offset": 5969, "text": "product and transportation cost environment relative", "global_span": [ 22017, 22069 ] }, { "id": 251, "label": "Traditional", "start_offset": 5973, "end_offset": 5984, "text": "fiscal 2023", "global_span": [ 22073, 22084 ] }, { "id": 252, "label": "Value", "start_offset": 6027, "end_offset": 6053, "text": "approximately $500 million", "global_span": [ 22127, 22153 ] }, { "id": 253, "label": "Traditional", "start_offset": 6057, "end_offset": 6076, "text": "reduced fixed costs", "global_span": [ 22157, 22176 ] }, { "id": 254, "label": "Traditional", "start_offset": 6126, "end_offset": 6149, "text": "expect operating margin", "global_span": [ 22226, 22249 ] }, { "id": 255, "label": "Value", "start_offset": 6153, "end_offset": 6172, "text": "approximately 14.1%", "global_span": [ 22253, 22272 ] }, { "id": 256, "label": "Value", "start_offset": 6393, "end_offset": 6419, "text": "approximately $500 million", "global_span": [ 22493, 22519 ] }, { "id": 257, "label": "Traditional", "start_offset": 6423, "end_offset": 6434, "text": "fixed costs", "global_span": [ 22523, 22534 ] }, { "id": 258, "label": "Traditional", "start_offset": 6459, "end_offset": 6470, "text": "fiscal 2024", "global_span": [ 22559, 22570 ] }, { "id": 259, "label": "Traditional", "start_offset": 6479, "end_offset": 6520, "text": "cost of goods sold and operating expenses", "global_span": [ 22579, 22620 ] }, { "id": 260, "label": "Traditional", "start_offset": 6526, "end_offset": 6544, "text": "effective tax rate", "global_span": [ 22626, 22644 ] }, { "id": 261, "label": "Value", "start_offset": 6560, "end_offset": 6579, "text": "approximately 24.5%", "global_span": [ 22660, 22679 ] }, { "id": 262, "label": "Traditional", "start_offset": 6591, "end_offset": 6611, "text": "net interest expense", "global_span": [ 22691, 22711 ] }, { "id": 263, "label": "Value", "start_offset": 6615, "end_offset": 6641, "text": "approximately $1.8 billion", "global_span": [ 22715, 22741 ] }, { "id": 264, "label": "Traditional", "start_offset": 6647, "end_offset": 6688, "text": "diluted earnings per share percent growth", "global_span": [ 22747, 22788 ] }, { "id": 265, "label": "Traditional", "start_offset": 6692, "end_offset": 6700, "text": "targeted", "global_span": [ 22792, 22800 ] }, { "id": 266, "label": "Value", "start_offset": 6707, "end_offset": 6723, "text": "approximately 1%", "global_span": [ 22807, 22823 ] }, { "id": 267, "label": "Traditional", "start_offset": 6724, "end_offset": 6732, "text": "compared", "global_span": [ 22824, 22832 ] }, { "id": 268, "label": "Traditional", "start_offset": 6736, "end_offset": 6747, "text": "fiscal 2023", "global_span": [ 22836, 22847 ] }, { "id": 269, "label": "Traditional", "start_offset": 6758, "end_offset": 6781, "text": "extra week contributing", "global_span": [ 22858, 22881 ] }, { "id": 270, "label": "Value", "start_offset": 6782, "end_offset": 6801, "text": "approximately $0.30", "global_span": [ 22882, 22901 ] }, { "id": 271, "label": "Traditional", "start_offset": 6854, "end_offset": 6874, "text": "capital expenditures", "global_span": [ 22954, 22974 ] }, { "id": 272, "label": "Value", "start_offset": 6878, "end_offset": 6894, "text": "approximately 2%", "global_span": [ 22978, 22994 ] }, { "id": 273, "label": "Traditional", "start_offset": 6895, "end_offset": 6903, "text": "of sales", "global_span": [ 22995, 23003 ] }, { "id": 274, "label": "Traditional", "start_offset": 6910, "end_offset": 6922, "text": "annual basis", "global_span": [ 23010, 23022 ] }, { "id": 336, "label": "Traditional", "text": "in November, ", "start_offset": 252, "end_offset": 265, "global_span": [ 16352, 16365 ] }, { "id": 337, "label": "Traditional", "text": " in December", "start_offset": 426, "end_offset": 438, "global_span": [ 16526, 16538 ] } ], "relations": [ { "id": 30, "entity_ids": [ 99, 100, 101 ], "description": "Value_of" }, { "id": 31, "entity_ids": [ 99, 100, 102, 103, 104 ], "description": "Value_of" }, { "id": 32, "entity_ids": [ 105, 106, 107 ], "description": "Value_of" }, { "id": 33, "entity_ids": [ 105, 106, 108, 336 ], "description": "Value_of" }, { "id": 34, "entity_ids": [ 106, 109, 110 ], "description": "Value_of" }, { "id": 35, "entity_ids": [ 106, 111, 112 ], "description": "Value_of" }, { "id": 36, "entity_ids": [ 113, 114, 115 ], "description": "Value_of" }, { "id": 37, "entity_ids": [ 113, 116, 117, 118 ], "description": "Value_of" }, { "id": 38, "entity_ids": [ 113, 119, 337 ], "description": "Value_of" }, { "id": 39, "entity_ids": [ 113, 120, 121, 122 ], "description": "Value_of" }, { "id": 40, "entity_ids": [ 123, 124 ], "description": "Value_of" }, { "id": 41, "entity_ids": [ 125, 126, 127 ], "description": "Value_of" }, { "id": 42, "entity_ids": [ 128, 129 ], "description": "Value_of" }, { "id": 43, "entity_ids": [ 130, 131 ], "description": "Value_of" }, { "id": 44, "entity_ids": [ 132, 133 ], "description": "Value_of" }, { "id": 45, "entity_ids": [ 134, 135, 136 ], "description": "Value_of" }, { "id": 46, "entity_ids": [ 137, 138, 139, 140 ], "description": "Value_of" }, { "id": 47, "entity_ids": [ 141, 142 ], "description": "Value_of" }, { "id": 48, "entity_ids": [ 141, 143, 144, 145 ], "description": "Value_of" }, { "id": 49, "entity_ids": [ 146, 147, 148, 149, 150 ], "description": "Value_of" }, { "id": 50, "entity_ids": [ 151, 152, 153 ], "description": "Value_of" }, { "id": 51, "entity_ids": [ 151, 154, 155 ], "description": "Value_of" }, { "id": 52, "entity_ids": [ 156, 157, 158 ], "description": "Value_of" }, { "id": 53, "entity_ids": [ 156, 157, 159 ], "description": "Value_of" }, { "id": 54, "entity_ids": [ 156, 157, 160 ], "description": "Value_of" }, { "id": 55, "entity_ids": [ 156, 157, 161 ], "description": "Value_of" }, { "id": 56, "entity_ids": [ 162, 163 ], "description": "Value_of" }, { "id": 57, "entity_ids": [ 164, 165, 166 ], "description": "Value_of" }, { "id": 58, "entity_ids": [ 164, 165, 167, 168 ], "description": "Value_of" }, { "id": 59, "entity_ids": [ 169, 170, 171 ], "description": "Value_of" }, { "id": 60, "entity_ids": [ 169, 170, 172, 173 ], "description": "Value_of" }, { "id": 61, "entity_ids": [ 174, 175 ], "description": "Value_of" }, { "id": 62, "entity_ids": [ 174, 176 ], "description": "Value_of" }, { "id": 63, "entity_ids": [ 174, 177 ], "description": "Value_of" }, { "id": 64, "entity_ids": [ 178, 179 ], "description": "Value_of" }, { "id": 65, "entity_ids": [ 180, 181, 182, 183 ], "description": "Value_of" }, { "id": 66, "entity_ids": [ 184, 185, 186 ], "description": "Value_of" }, { "id": 67, "entity_ids": [ 187, 188, 189 ], "description": "Value_of" }, { "id": 68, "entity_ids": [ 190, 191, 192 ], "description": "Value_of" }, { "id": 69, "entity_ids": [ 193, 194 ], "description": "Value_of" }, { "id": 70, "entity_ids": [ 195, 196, 197 ], "description": "Value_of" }, { "id": 71, "entity_ids": [ 198, 199, 200, 201 ], "description": "Value_of" }, { "id": 72, "entity_ids": [ 202, 203 ], "description": "Value_of" }, { "id": 73, "entity_ids": [ 204, 205, 206 ], "description": "Value_of" }, { "id": 74, "entity_ids": [ 207, 208 ], "description": "Value_of" }, { "id": 75, "entity_ids": [ 209, 210, 211, 212 ], "description": "Value_of" }, { "id": 76, "entity_ids": [ 209, 210, 211, 212, 213 ], "description": "Value_of" }, { "id": 77, "entity_ids": [ 213, 214, 215 ], "description": "Value_of" }, { "id": 78, "entity_ids": [ 216, 217, 219 ], "description": "Value_of" }, { "id": 79, "entity_ids": [ 216, 218, 219, 220, 221 ], "description": "Value_of" }, { "id": 80, "entity_ids": [ 222, 223, 224 ], "description": "Value_of" }, { "id": 81, "entity_ids": [ 225, 226, 227 ], "description": "Value_of" }, { "id": 82, "entity_ids": [ 228, 229, 230 ], "description": "Value_of" }, { "id": 83, "entity_ids": [ 231, 232 ], "description": "Value_of" }, { "id": 84, "entity_ids": [ 233, 234, 235 ], "description": "Value_of" }, { "id": 85, "entity_ids": [ 236, 237 ], "description": "Value_of" }, { "id": 86, "entity_ids": [ 238, 239 ], "description": "Value_of" }, { "id": 87, "entity_ids": [ 241, 242 ], "description": "Value_of" }, { "id": 88, "entity_ids": [ 243, 244, 245 ], "description": "Value_of" }, { "id": 89, "entity_ids": [ 243, 244, 246, 247, 248 ], "description": "Value_of" }, { "id": 90, "entity_ids": [ 249, 250, 251 ], "description": "Value_of" }, { "id": 91, "entity_ids": [ 252, 253 ], "description": "Value_of" }, { "id": 92, "entity_ids": [ 254, 255 ], "description": "Value_of" }, { "id": 93, "entity_ids": [ 256, 257, 258, 259 ], "description": "Value_of" }, { "id": 94, "entity_ids": [ 260, 261 ], "description": "Value_of" }, { "id": 95, "entity_ids": [ 262, 263 ], "description": "Value_of" }, { "id": 96, "entity_ids": [ 264, 265, 266, 267, 268 ], "description": "Value_of" }, { "id": 97, "entity_ids": [ 264, 269, 270 ], "description": "Value_of" }, { "id": 98, "entity_ids": [ 271, 272, 273, 274 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "Operator: [Operator Instructions ] Our first question comes from the line of Simeon Gutman with Morgan Stanley.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Simeon Gutman: My first question is how much of this minus 1 comp view is an industry view plus or minus share gain, I ' m assuming plus versus if you look at current purchasing trends and Richard, you noted some of the, let 's say, some of the less headwinds that you noted that you expect to face in 2023.", "ground_truth_output": { "entities": [ { "id": 275, "label": "Value", "start_offset": 54, "end_offset": 61, "text": "minus 1", "global_span": [ 23825, 23832 ] }, { "id": 276, "label": "Traditional", "start_offset": 62, "end_offset": 71, "text": "comp view", "global_span": [ 23833, 23842 ] } ], "relations": [ { "id": 99, "entity_ids": [ 275, 276 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Richard McPhail: Sure. Yes, Simeon, in short, we expect that the macro pressures we called out to point towards low single - digit negative growth from improvement demand and then for us to outperform the market. And that 's how we got to the negative 1% comp guide. And your second part of your question, Simeon?", "ground_truth_output": { "entities": [ { "id": 277, "label": "Value", "start_offset": 244, "end_offset": 255, "text": "negative 1%", "global_span": [ 24323, 24334 ] }, { "id": 278, "label": "Traditional", "start_offset": 256, "end_offset": 266, "text": "comp guide", "global_span": [ 24335, 24345 ] } ], "relations": [ { "id": 100, "entity_ids": [ 277, 278 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Simeon Gutman: I guess, that was the whole part of it. It was how much of it is a macro view versus like a forecast for housing plus market share versus you have less headwinds that you noted in the current year, plus you 're combining that with how the consumer is behaving.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Richard McPhail: Well, it 's all taken as a whole, there are several cross currents here. Again, we face macro headwinds, albeit at a lesser degree than we faced in 2023. And so again, just to quickly tick through them, PCE is expected to decelerate. We still have a slightly -- as a market, we have a slightly elevated share of PCE versus 2019, we know that, that has gradually receded since 2021. The interest rate environment is still one where while we see our customers have the means to spend, they are taking more of a deferral stance with respect to large project demand. And we believe there was some pull forward certain spend during the period of 2020 to 2022 that we 're working out. Housing, it 's a little hard to tease out. Obviously, home values have held in there. We now see home prices having appreciated by over 46% since 2019. Turnover has dropped sharply over the last two years, and that 's a headwind possibly offset by some level of improvement in place. So we 're essentially neutral on housing short term. And so that 's -- all of those have an impact on our market. And then as you said, we expect to gained share in any macro environment through our growth initiatives of Pro, the interconnected experience and new stores, and that takes us to our negative 1% comp outlook.", "ground_truth_output": { "entities": [ { "id": 279, "label": "Value", "start_offset": 1003, "end_offset": 1010, "text": "neutral", "global_span": [ 25675, 25682 ] }, { "id": 280, "label": "Traditional", "start_offset": 1014, "end_offset": 1032, "text": "housing short term", "global_span": [ 25686, 25704 ] }, { "id": 281, "label": "Value", "start_offset": 1278, "end_offset": 1289, "text": "negative 1%", "global_span": [ 25950, 25961 ] }, { "id": 282, "label": "Traditional", "start_offset": 1290, "end_offset": 1302, "text": "comp outlook", "global_span": [ 25962, 25974 ] } ], "relations": [ { "id": 101, "entity_ids": [ 279, 280 ], "description": "Value_of" }, { "id": 102, "entity_ids": [ 281, 282 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Simeon Gutman: Fair enough. And then a follow - up, can we ask about the shape of the year? You lapped lumber deflation in the first part of the year, maybe some weather. So that should be better, but the second half is in theory post interest rate cuts, maybe durables get a little bit better. So how should we think about it?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Richard McPhail: Yes. So Simeon, lumber was actually a function more of a comparison to 2022 and 2023. If you compare the lumber charts, just I 'd encourage you to pull it up, lumber prices were relatively steady across 2023. So we do n't really see a material impact to 2024. With respect to ' 24, first, we expect a normal seasonal curve for our business. So there 's really no seasonal shift in how we think about the halves. We anticipate the second half coming in slightly better than the first half, with both being negative, at least as implied in our guidance. It might help to recall the halves for 2023, were relatively in line with one another..", "ground_truth_output": { "entities": [ { "id": 283, "label": "Traditional", "start_offset": 177, "end_offset": 190, "text": "lumber prices", "global_span": [ 26480, 26493 ] }, { "id": 284, "label": "Value", "start_offset": 196, "end_offset": 213, "text": "relatively steady", "global_span": [ 26499, 26516 ] }, { "id": 285, "label": "Traditional", "start_offset": 221, "end_offset": 225, "text": "2023", "global_span": [ 26524, 26528 ] } ], "relations": [ { "id": 103, "entity_ids": [ 283, 284, 285 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from the line of Zachary Fadem with Wells Fargo.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Zachary Fadem: So starting with the underlying comp commentary. Curious if you could share some thoughts on Pro versus DIY trends, both for the industry as well as your share gain potential? And then any early thoughts on traffic versus ticket?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "Edward Decker: If you look at Pro versus consumer, Zach. I mean, for us, they were -- they were effectively the same in Q4. Overall, industry do n't see that being too terribly much different. I can say within our Pro in any customer segment that we have, the managed account customer who is engaging in the ecosystem that we 're building was the highest performing customer segment in Q4 and throughout 2023, and we would expect that to continue into 2024 as well as we continue to build out the capabilities.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Zachary Fadem: And then you called out the disinflationary price environment. I ' m curious if you could parse that out between commodity deflation and promotional activity. And then as you look at ' 24, could you walk through the signs that you 're seeing to suggest that we have turned the corner on the disinflation?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "William Bastek: Yes. This is Billy. Thanks for the question. On the commodity piece, that is embedded in our forward - looking guidance that Rich had articulated during his prepared remarks. So -- and as it relates to the promotional cadence, we have n't seen any difference if you go back pre - pandemic to the promotional activity. We are in a very normalized environment. We do feel that pricing has kind of settled as we mentioned earlier. And so from a promotional standpoint, cadence, we do n't see any differentiation then like I said, what we lived through prior to the pandemic. So very consistent. We really are in a solid marketplace as it relates to that and look forward to 2024.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from the line of Chris Horvers with JPMorgan.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Christopher Horvers: So I was curious, as you think about the share of wallet, what did you learn over the holiday season? Are there any signs of life that you 're seeing? You mentioned outdoor garden, I ' m assuming maybe that 's Christmas trees and Christmas decor. Is there any signs of life that maybe the smaller ticket softline stuff is starting to show where more decor items starting to show some signs of life. Did you see anything in appliances or on the bigger ticket side?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "Edward Decker: No. Chris, it 's Ted. We saw great signs of life. There 's loads of life in the sector. I mean we 're working through some macro factors, as Richard articulated, but the consumer is healthy and the consumer is engaged. They 're just engaged at this point in smaller projects. And you called out a number of categories that we had terrific engagement in Q4. Our Deco holiday program was just an exceptional performer, the merchants there, just keep taking that to the next level. We know we took a tremendous amount of share in Deco holiday as the customer responds to our offering. Our gift center line up with the brands we have and the values that Billy and team put in the marketplace had a tremendous response. As you said, Deco Holiday in live goods did extremely well. Things like totes, I mean we saw sold record units of totes in Q4 as people responded to our storage event. So we still have tremendous traffic, just pure volume of traffic and engagement. Again, it 's just that bigger ticket. Although as an aside on bigger ticket, appliances was one of our better relative performers. And I think a lot of that has to do with our service levels as we 're integrating the TEMCO acquisition in the percentage of our deliveries that they 're now handling in the service level scores and on time and complete that they 're providing our customers. We think that 's a big piece of the momentum behind our appliance business as well as the strength of our online shopping experience for major appliances.", "ground_truth_output": { "entities": [ { "id": 286, "label": "Traditional", "start_offset": 824, "end_offset": 828, "text": "sold", "global_span": [ 30201, 30205 ] }, { "id": 287, "label": "Value", "start_offset": 829, "end_offset": 835, "text": "record", "global_span": [ 30206, 30212 ] }, { "id": 288, "label": "Traditional", "start_offset": 836, "end_offset": 850, "text": "units of totes", "global_span": [ 30213, 30227 ] }, { "id": 289, "label": "Traditional", "start_offset": 854, "end_offset": 856, "text": "Q4", "global_span": [ 30231, 30233 ] } ], "relations": [ { "id": 104, "entity_ids": [ 286, 287, 288, 289 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Christopher Horvers: And then as a follow - up, can you talk about what drove the gross margin decline here in the fourth quarter? You mentioned the expansion here coming in 2024. And then separately, just on the SG&A side, you did have a, I think, sizable legal gain in the first quarter of last year. Is that something that will have an effect on 2024 overall?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Richard McPhail: Sure. Chris, it 's Richard. So first on fourth quarter gross margin, I 'd say, our gross margin, first of all, is in line with our expectations for the year. For the full year and in the quarter, we saw some pull forward of pressure from pricing actions ahead of cost decreases. The good news is you now see those at current levels, and Billy mentioned, we 're really at kind of a settled point right now in retail and in cost. As we begin to work through inventory layers, you now see the impact of those cost decreases that we took earlier in the year coming through in 2024, and that 's the major driver behind the gross margin expansion that we ' ve guided to. On the settlement that you called out, I appreciate the question. It 's important to note that there is some geography noise in year - over - year comparisons driven by that settlement. So just for everyone 's recollection, we had a significant settlement in Q1 of 2023. That was a benefit to operating expense. Now as we said we would do, we fully offset that benefit with short - term costs in 2023 that set us up to lower our cost base going forward. Those short - term costs were mostly incurred in cost of goods sold, including some actions taken to optimize inventory levels. So that settlement geography and the cost that offset it create a more favorable comparison in cost of goods sold and a less favorable comparison in OpEx on a year - over - year basis, but obviously, the two offset each other, and it ’s a geography shift.", "ground_truth_output": { "entities": [ { "id": 290, "label": "Traditional", "start_offset": 60, "end_offset": 87, "text": "fourth quarter gross margin", "global_span": [ 31325, 31352 ] }, { "id": 291, "label": "Value", "start_offset": 134, "end_offset": 146, "text": "in line with", "global_span": [ 31399, 31411 ] }, { "id": 292, "label": "Value", "start_offset": 151, "end_offset": 163, "text": "expectations", "global_span": [ 31416, 31428 ] }, { "id": 293, "label": "Traditional", "start_offset": 172, "end_offset": 176, "text": "year", "global_span": [ 31437, 31441 ] } ], "relations": [ { "id": 105, "entity_ids": [ 290, 291, 292, 293 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from the line of Scott Ciccarelli with Truist.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Scott Ciccarelli: Within your comp guide, can you help us understand how you guys are modeling any benefit or accretion from your complex Pro build - out just so we can better understand the thought process around it. And just as a side bar, can you also tell us how big of a margin drag you expect the incentive comp swing to be in ' 24?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Edward Decker: On the complex Pro, I mean, clearly, the improvements there and the expectation that the managed account engaging in those capabilities will be the strongest performing customer segment. That 's embedded in the guidance of comp sales in overall sales.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Richard McPhail: And on the drag from lower incentive bonus in 2023, really the largest and most meaningful driver of deleverage, as you know, our OpEx leverage or deleverage as a function of sales growth. So the largest driver of that is simply sales deleverage as operating cost inflation remains higher than sales growth. To a lesser extent, we see deleverage from the the incentive compensation year - over - year.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 27, "sub_chunk_id": 0, "sentences": "Scot Ciccarelli: Okay. Can I ask a follow - up on that? So just so I can understand that -- yes, I understand the managed accounts are kind of the fastest growing. But -- like are you guys able to kind of disaggregate, let 's call it, the typical engagement you would have with those accounts. versus the expanding capabilities you 're providing in certain markets? Or is it just too difficult to kind of separate those?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 28, "sub_chunk_id": 0, "sentences": "Edward Decker: No, we can not absolutely. And we disaggregate at every level you can imagine. We 're just not going to share all that detail as you can imagine.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 29, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from the line of Chuck Grom with Gordon Haskett.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 30, "sub_chunk_id": 0, "sentences": "Charles Grom: Just bigger picture. Curious what you guys are monitoring across regions or product categories to suggest that demand for the home improvement category from a unit volume perspective is starting to bottom here as we look out over the next couple of years?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 31, "sub_chunk_id": 0, "sentences": "Richard McPhail: Well, just to hit it on the most fine point here, really the last three quarters, we ' ve seen kind of the most stability and the -- I 'd say, three quarters ago, we saw a marked recovery in transactions and think about that as a proxy for units, but units followed similarly. Over the last three quarters, we ' ve seen nice stability. And as we ' ve said before, we define a healthy home improvement market is one where ticket and transaction are both positive. What we have seen on the good side here is that ticket and transaction have begun to converge and in fact, have sort of really much more tightly converged over the last three quarters.. They were still both negative for the quarter, but that 's really just reflective of the macro pressure that continues. From a geographic perspective, we are n't really necessarily able to tease out differences in recovery and transactions or units more of a national dynamic.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 32, "sub_chunk_id": 0, "sentences": "Charles Grom: Okay. Great. And then one for you, Richard. Just how should we think about the every point of comp? Hypothetically, you guys are being a little bit conservative here on the down 1. Just trying to think about how the model could respond.", "ground_truth_output": { "entities": [ { "id": 294, "label": "Traditional", "start_offset": 100, "end_offset": 113, "text": "point of comp", "global_span": [ 35877, 35890 ] }, { "id": 295, "label": "Value", "start_offset": 188, "end_offset": 194, "text": "down 1", "global_span": [ 35965, 35971 ] } ], "relations": [ { "id": 106, "entity_ids": [ 294, 295 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 33, "sub_chunk_id": 0, "sentences": "Richard McPhail: Sure. I mean the basics are you can imagine with no management intervention, the natural rule of leverage or deleverage is about 10 basis points per point of comp up or down.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 34, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from the line of Michael Lasser with UBS.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 35, "sub_chunk_id": 0, "sentences": "Michael Lasser: As we look back to the last couple of downturns in home improvement, there was a pretty robust recovery in the subsequent years after a few periods of negative comps. Are you seeing any evidence or signs that this recovery whenever it happens, would be different?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 36, "sub_chunk_id": 0, "sentences": "Edward Decker: We do n't see why it would be different. I mean, if anything, the underpinning of this market segment remains incredibly strong. When I step back, and look at the macro, when you look at the influences that we watch most closely, home price appreciation, up 45 - odd percent, home equity is up closer to 70%. That equity level, which is $10 trillion, $12 trillion increase since the pandemic has not been tapped. And in fact, HELOCs and cash out refis are at multiple years low right now as interest rates went up over the last two years. So you have tremendous potential in an untapped balance sheet and equity position in homes. We talk about the age of homes now well over 50% or over 40 years old. People are still working from home, more than they were certainly pre - pandemic. So usage in homes, the fundamental shortage of homes were I ' ve seen anywhere between 2 million and 6 million units short. And on a near term, even forecast for 2024, we 'll build 2000 - odd units less than demand. So you 're not even beginning to make up for that shortage in the near term. So you look at all those factors, millennials becoming a year or so way of becoming the single biggest source of customer segment spend in our space. They 're a prime household formation in homeownership ages. So I look at all those and say, huge opportunity. And we ' ve mentioned this before, but the pandemic in a sense is a bit like a giant hurricane, right? I mean, we had tremendous demand in growth in the segment, followed by a couple periods of moderation following that buildup. But as we watch every hurricane market, after you go through that cycle, it 's as strong as ever. So with that backdrop of fundamental macros in the overall pandemic playing out over a five - year period like a giant national storm, we have every reason to be extremely optimistic about the future. And that 's why we ' ve made the comments today about how happy we are of what we accomplished, the management team here in the store associates and store leadership and supply chain just did such a great job level setting this business following that sort of pandemic storm and we could n't feel better about how we 're positioned from an operational point of view. And then we 're sticking with all the strategic investments, our eyes are still on the prize of the best interconnected shopping experience, building out the Pro ecosystem for complex Pros and then having such confidence in our model to start a reasonably meaningful store build program. So we feel really, really good, Michael. Thanks for the question.", "ground_truth_output": { "entities": [ { "id": 296, "label": "Traditional", "start_offset": 246, "end_offset": 269, "text": "home price appreciation", "global_span": [ 36822, 36845 ] }, { "id": 297, "label": "Value", "start_offset": 271, "end_offset": 276, "text": "up 45", "global_span": [ 36847, 36852 ] }, { "id": 298, "label": "Traditional", "start_offset": 279, "end_offset": 290, "text": "odd percent", "global_span": [ 36855, 36866 ] }, { "id": 299, "label": "Traditional", "start_offset": 292, "end_offset": 303, "text": "home equity", "global_span": [ 36868, 36879 ] }, { "id": 300, "label": "Value", "start_offset": 307, "end_offset": 316, "text": "up closer", "global_span": [ 36883, 36892 ] }, { "id": 301, "label": "Value", "start_offset": 320, "end_offset": 323, "text": "70%", "global_span": [ 36896, 36899 ] }, { "id": 302, "label": "Traditional", "start_offset": 330, "end_offset": 342, "text": "equity level", "global_span": [ 36906, 36918 ] }, { "id": 303, "label": "Value", "start_offset": 353, "end_offset": 365, "text": "$10 trillion", "global_span": [ 36929, 36941 ] }, { "id": 304, "label": "Value", "start_offset": 367, "end_offset": 388, "text": "$12 trillion increase", "global_span": [ 36943, 36964 ] }, { "id": 305, "label": "Traditional", "start_offset": 442, "end_offset": 467, "text": "HELOCs and cash out refis", "global_span": [ 37018, 37043 ] }, { "id": 306, "label": "Traditional", "start_offset": 475, "end_offset": 489, "text": "multiple years", "global_span": [ 37051, 37065 ] }, { "id": 307, "label": "Value", "start_offset": 490, "end_offset": 493, "text": "low", "global_span": [ 37066, 37069 ] }, { "id": 308, "label": "Traditional", "start_offset": 507, "end_offset": 521, "text": "interest rates", "global_span": [ 37083, 37097 ] }, { "id": 309, "label": "Value", "start_offset": 527, "end_offset": 529, "text": "up", "global_span": [ 37103, 37105 ] }, { "id": 310, "label": "Traditional", "start_offset": 539, "end_offset": 553, "text": "last two years", "global_span": [ 37115, 37129 ] }, { "id": 311, "label": "Non_Traditional", "start_offset": 665, "end_offset": 677, "text": "age of homes", "global_span": [ 37241, 37253 ] }, { "id": 312, "label": "Value", "start_offset": 687, "end_offset": 695, "text": "over 50%", "global_span": [ 37263, 37271 ] }, { "id": 313, "label": "Non_Traditional", "start_offset": 699, "end_offset": 716, "text": "over 40 years old", "global_span": [ 37275, 37292 ] }, { "id": 314, "label": "Value", "start_offset": 887, "end_offset": 896, "text": "2 million", "global_span": [ 37463, 37472 ] }, { "id": 315, "label": "Value", "start_offset": 901, "end_offset": 910, "text": "6 million", "global_span": [ 37477, 37486 ] } ], "relations": [ { "id": 107, "entity_ids": [ 296, 297, 298 ], "description": "Value_of" }, { "id": 108, "entity_ids": [ 299, 300, 301 ], "description": "Value_of" }, { "id": 109, "entity_ids": [ 302, 303 ], "description": "Value_of" }, { "id": 110, "entity_ids": [ 302, 304 ], "description": "Value_of" }, { "id": 111, "entity_ids": [ 305, 306, 307 ], "description": "Value_of" }, { "id": 112, "entity_ids": [ 308, 309, 310 ], "description": "Value_of" }, { "id": 113, "entity_ids": [ 311, 312, 313 ], "description": "Value_of" }, { "id": 114, "entity_ids": [ 314, 315 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 37, "sub_chunk_id": 0, "sentences": "Michael Lasser: That 's very helpful, Ted. If I could just add one more question. It 's on Richard 's comment about the rule of thumb of 10 basis points of margin expansion for every 1 point of comp. And understanding that this is theoretical, does that move in a linear fashion, meaning if you get back to the trajectory of mid - single - digit comp eventually that you would see a better than trend rate of margin expansion at the higher the growth rate. And there was also a comment that rule of thumb would be outside of actions that would be taken. So can you discuss what actions might be taken to bend that curve on the upside over time?", "ground_truth_output": { "entities": [ { "id": 316, "label": "Value", "start_offset": 138, "end_offset": 153, "text": "10 basis points", "global_span": [ 39315, 39330 ] }, { "id": 317, "label": "Traditional", "start_offset": 157, "end_offset": 183, "text": "margin expansion for every", "global_span": [ 39334, 39360 ] }, { "id": 318, "label": "Value", "start_offset": 184, "end_offset": 185, "text": "1", "global_span": [ 39361, 39362 ] }, { "id": 319, "label": "Traditional", "start_offset": 186, "end_offset": 199, "text": "point of comp", "global_span": [ 39363, 39376 ] } ], "relations": [ { "id": 115, "entity_ids": [ 316, 317, 318, 319 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 38, "sub_chunk_id": 0, "sentences": "Richard McPhail: Thanks, Michael. Well, first, I certainly want to center you back to the comments we made at the Investor Conference in June where we call out a base case once we return to market normalization, a base case of 3% to 4% sales growth, flat gross margin, an assumption of operating expense and operating margin leverage and growth and EPS growth of mid- to high single - digit percentages. Within that, obviously, is sort of an implied leverage per comp point on our OpEx. I ' m giving you a, what I would call, loose rule of thumb. It would apply for the most part to our sort of business model today, it certainly applies in the past and I would expect it to apply it loosely in the future. Embedded in that is a normal rate of productivity and efficiency that our teams delivered every single year. I mean underneath all this guidance and our results for 2023, which we were so pleased with, is an enormous amount of work on behalf of our team, think about the efficiency in our supply chain, you think about the efficiencies that our merchants bring every year in product cost. Of particular note, the productivity in our stores with some of the tools that are unleashing the power of AI and putting that in the hands of our associates, those are standard fair for us. They feed into what I would call normal operating leverage for the Home Depot, and it ’s something that we ’ ve come to expect of ourselves. So that ’s a long way of saying, we always intend to lever OpEx at a certain point of sales growth. And I would stick with the basic rule of thumb, maybe higher, maybe slightly lower in some periods from time to time. On the question about what actions there may be, but we always operate with a degree of financial flexibility in the P&L. Although, I would tell you that we did our very best, and I think we accomplished our objective of reducing fixed costs towards the end of ‘ 23 that had built up during the pandemic, hence the $500 million in cost savings implied in our guide. There are always levers. We have to determine what environment we are operating in before we decide what levers to pull. And so for now, we ’ ve provided what we would call our central case for 2024, but we ’re going to manage the business with the best interest of our long - term shareholders in mind.", "ground_truth_output": { "entities": [ { "id": 320, "label": "Value", "start_offset": 228, "end_offset": 235, "text": "3% to 4", "global_span": [ 40050, 40057 ] }, { "id": 321, "label": "Traditional", "start_offset": 237, "end_offset": 249, "text": "sales growth", "global_span": [ 40059, 40071 ] }, { "id": 322, "label": "Traditional", "start_offset": 251, "end_offset": 268, "text": "flat gross margin", "global_span": [ 40073, 40090 ] }, { "id": 323, "label": "Traditional", "start_offset": 287, "end_offset": 360, "text": "operating expense and operating margin leverage and growth and EPS growth", "global_span": [ 40109, 40182 ] }, { "id": 324, "label": "Value", "start_offset": 364, "end_offset": 383, "text": "mid- to high single", "global_span": [ 40186, 40205 ] }, { "id": 325, "label": "Value", "start_offset": 386, "end_offset": 403, "text": "digit percentages", "global_span": [ 40208, 40225 ] }, { "id": 326, "label": "Value", "start_offset": 1962, "end_offset": 1974, "text": "$500 million", "global_span": [ 41784, 41796 ] }, { "id": 327, "label": "Traditional", "start_offset": 1978, "end_offset": 1990, "text": "cost savings", "global_span": [ 41800, 41812 ] }, { "id": 328, "label": "Traditional", "start_offset": 2006, "end_offset": 2011, "text": "guide", "global_span": [ 41828, 41833 ] } ], "relations": [ { "id": 116, "entity_ids": [ 320, 321 ], "description": "Value_of" }, { "id": 117, "entity_ids": [ 322, 323, 324, 325 ], "description": "Value_of" }, { "id": 118, "entity_ids": [ 326, 327, 328 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 39, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from the line of Seth Sigman with Barclays.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 40, "sub_chunk_id": 0, "sentences": "Seth Sigman: I wanted to follow up on macro and the margins. Just on the macro side, you gave us a number of the factors that have built in here. I guess the real question is, what are the conditions needed for comps to actually get back to positive? Is it as simple as fully digesting the two years of lower housing turnover and that will happen at some point through this year? I guess, ultimately, can you return to growth without existing home sales improving?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 41, "sub_chunk_id": 0, "sentences": "Edward Decker: Absolutely. I mean as we ' ve said for the longest time, home turnover is a base of home improvement demand, but it 's been pretty steady. If you look at 4.5 - odd percent of housing stock is a multiyear percentage of turnover, and that equates to 5 - ish million units. The reason we 're calling out that is a factor in these last two years is the dramatic decrease. And there 's definitely an understanding that there 's an improvement in place cycle if you do n't move and you stay in your house, but there 's a lag effect. And arguably, that lag effect is a bit longer this time because of the interest rate environment and people are just being conservative of when they kick off a larger home improvement project in a home that they 're going to ultimately stay in for a longer period of time. So that 's the dynamic of housing turnover. We think that plays out. We 're literally at a 40 - year low in turnover, do n't see that going lower. So you 're going to cycle through that kind of a two - year pressure. And then do we get back to growth? Absolutely. I 'd say, we have a neutral look on housing for 2024. We do n't think there 's incremental pressure nor do we think that we 're quite ready for a hockey stick recovery. Richard has been talking for some time, and the Fed 's stance of hire for longer. I think we now we have an appreciation that longer is going to go through the first half of this year. So even a lowering cycle in the back half, there 's some timing effect to get mortgages, move homes, take a HELOC loan out, et cetera, to get a bigger project going. So that 's why we 're kind of calling for a slighter moderation to continue into ' 24. But as we said, the back half is marginally stronger. And we think all the macros line up for return to normalcy following that and with the capabilities that we 're building, and we 're taking share today with x percent of these capabilities complete. Super optimistic about how we 're hitting the ground running as we continue to build going into a stronger market and the share gain opportunity.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 42, "sub_chunk_id": 0, "sentences": "Seth Sigman: Okay. Just one follow - up. Richard, you gave us a bunch of sensitivity numbers around the EBIT margins. I guess, more specifically on SG&A for this year. I realize there 's a number of moving pieces that come back. But can you give us a feel for what base underlying SG&A growth should look like this year? I think the headline guidance is around 4% growth. But maybe what is it excluding incentive comp and some of the costs that you 're lapping with the benefits that you 're lapping, just so we could think about that?", "ground_truth_output": { "entities": [ { "id": 329, "label": "Traditional", "start_offset": 271, "end_offset": 293, "text": "underlying SG&A growth", "global_span": [ 45037, 45059 ] }, { "id": 330, "label": "Traditional", "start_offset": 334, "end_offset": 351, "text": "headline guidance", "global_span": [ 45100, 45117 ] }, { "id": 331, "label": "Value", "start_offset": 362, "end_offset": 371, "text": "4% growth", "global_span": [ 45128, 45137 ] } ], "relations": [ { "id": 119, "entity_ids": [ 329, 330, 331 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 43, "sub_chunk_id": 0, "sentences": "Richard McPhail: Yes, I 'd tell you, the best way to look at this is that we are now - our P&L provides you with an appropriate jumping off point for your models, there 's a lot of noise in operating expense. If you think about the geography of the settlement in Q1, you think about the geography of costs that we incurred, then you think about the geography of the $500 million in cost out, two - thirds of which will be realized in OpEx, one - third of which will be realized in cost of goods sold, and you just have a lot of noise. Again, the main driver of operating expense growth is going to be just at inflation on our base of operating expenses. And we think that if you look at our gross margin and our operating margin guide, these offer you the appropriate jumping off points for your modeling.", "ground_truth_output": { "entities": [ { "id": 332, "label": "Value", "start_offset": 367, "end_offset": 379, "text": "$500 million", "global_span": [ 45669, 45681 ] }, { "id": 333, "label": "Traditional", "start_offset": 562, "end_offset": 586, "text": "operating expense growth", "global_span": [ 45864, 45888 ] } ], "relations": [ { "id": 120, "entity_ids": [ 332, 333 ], "description": "Value_of" } ] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 44, "sub_chunk_id": 0, "sentences": "Isabel Janci: Christine, we have time for one more question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 45, "sub_chunk_id": 0, "sentences": "Operator: Our final question comes from the line of Steven Forbes with Guggenheim.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 46, "sub_chunk_id": 0, "sentences": "Steven Forbes: I 'll keep it to one, just to end the call here. I wanted to follow - up on the complex Pro, Ted. I appreciate the comments in your prepared remarks around trade credit being piloted. I ' m curious if you can maybe expand on some early learnings around those newer features being launched as we think through what the sort of managed account customer can contribute to growth over the coming years here?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 47, "sub_chunk_id": 0, "sentences": "Ann - Marie Campbell: Yes, I 'll kick that off. Thanks, Ed. First of all, we 're in our early stages. And just as a reminder as well, HD Supply does trade credit today. So we 're -- as we architect our program, there 's a lot of learnings there. But what -- to me, typically in the room and Chip, you have a lot of it here with trade credit and his experience is helping us also form some of the intricacies of how we think about it. So I 'll turn it over to Chip.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 48, "sub_chunk_id": 0, "sentences": "Chip Devine: Yes. Thanks, Steven. Trade credit is definitely a necessary capability that we ’re building really focused on that complex project. So as we invest in our pros and our capabilities to be able to service their larger jobs, trade credit is definitely necessary. So we ’re in early days, as Anne mentioned, piloting a number of different customers, but plan to grow and expand that through the next couple of quarters as we automate that into our selling system as well..", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 49, "sub_chunk_id": 0, "sentences": "Operator: Ms. Janci, I would now like to turn the floor back over to you for closing comments..", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 50, "sub_chunk_id": 0, "sentences": "Isabel Janci: Thanks, Christine, and thank you, everybody, for joining us today. We look forward to speaking with you on our first quarter call in May.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "HD", "quarter": 4, "year": 2023, "date": "2024-02-20 12:21:05", "chunk_id": 51, "sub_chunk_id": 0, "sentences": "Operator: Ladies and gentlemen, this does conclude today 's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Operator: Good morning, and welcome to Johnson & Johnson 's Third Quarter 2024 Earnings Conference Call. All participants will be in a listen - only mode until the question - and - answer session of the conference. This call is being recorded. If anyone has any objections, you may disconnect at this time. [Operator Instructions ] I would now like to turn the conference call over to Johnson & Johnson. You may begin.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Jessica Moore: Hello, everyone. This is Jessica Moore, Vice President of Investor Relations for Johnson & Johnson. Welcome to our company 's review of the third quarter results and our full year financial outlook for 2024. A few logistics before we get into the details. As a reminder, you can find additional materials, including today 's presentation and associated schedules on the Investor Relations section of the Johnson & Johnson website at investor.jnj.com. Please note that this presentation contains forward - looking statements regarding, among other things, the company 's future operating and financial performance, market position and business strategy. You are cautioned not to rely on these forward - looking statements, which are based on the current expectations of future events using the information available as of the date of this recording and are subject to certain risk and uncertainties that may cause the company 's actual results to differ materially from those projected. A description of these risks, uncertainties and other factors can be found in our SEC filings, including our 2023 Form 10 - K, which is available at investor.jnj.com and on the SEC 's website. Additionally, several of the products and compounds discussed today are being developed in collaboration with strategic partners or licensed from other companies. This slide acknowledges those relationships. Moving to today 's agenda. Joaquin Duato, our Chairman and CEO, will kick us off with opening remarks and highlight key catalysts within the segments. I will review the third quarter sales and P&L results for the enterprise, as well as highlights related to our two businesses. Joe Wolk, our CFO, will then provide an overview of our pipeline advancements, cash position, capital allocation priorities and guidance for 2024, as well as qualitative considerations for 2025. Jennifer Taubert, John Reed and Tim Schmid, our Innovative Medicine and MedTech leaders, will be joining us for Q&A. To ensure we provide enough time to address your questions, we anticipate the webcast will last approximately 60 minutes. I will now turn the call over to Joaquin.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Joaquin Duato: Thank you, Jess, and hello, everyone. As you will hear, we delivered strong results in the third quarter with 6.3% operational sales growth. Our performance, once again, reflects the unique breadth of our business and our commitment to delivering the next wave of healthcare innovation to patients around the world. It also reflects the work we have done to shift our pipeline and portfolio to high innovation and high growth markets. That work continues, which you saw with the recently completed acquisitions of Shockwave and V - Wave in MedTech and Ambrx, Proteologix and NM26 bispecific antibody in Innovative Medicine. And we are pleased with the progress we are making. In Innovative Medicine, we reported a second consecutive quarter of sales exceeding $14 billion with 11 key brands growing double - digits. DARZALEX became the first product in our portfolio to reach $3 billion in sales in a single quarter. And as you will hear, our pipeline of high innovation, high growth potential assets is advancing rapidly with five major U.S. and EC approvals in the quarter. This includes FDA approval of RYBREVANT plus LAZCLUZE as first line treatment for EGFR - mutated advanced lung cancer, a transformational step forward for patients, and FDA approval of TREMFYA for active ulcerative colitis, which represents a significant opportunity for Johnson & Johnson, given 75% of STELARA sales today come from inflammatory bowel disease. And with filings and reviews underway for many of our innovative medicines that have the potential to generate $5 billion in peak year sales, we are increasingly confident in our near- and long - term growth trajectory. In MedTech, you can see the impact of our portfolio shift to high innovation, high growth markets, particularly in Cardiovascular. With the recent acquisitions of Shockwave and Abiomed, we are now category leaders in four of the largest and highest growth cardiovascular intervention medtech markets, which in Q3 translated to another quarter of double - digit growth across the Cardiovascular portfolio. And with the full market launch of Shockwave E8 peripheral IVL catheter, we are seeing an immediate impact of the Shockwave acquisition. In Vision, growth is accelerating, and we expect that to continue with the recent full market release of TECNIS Odyssey in the U.S. and ACUVUE OASYS MAX 1 - Day contact lenses. We are also excited about the future of our surgery business. As you will recall, in November 2023, we committed to submitting the OTTAVA robotic surgical system for an investigational device exemption, or IDE, to the U.S. FDA in the second half of 2024 to initiate clinical trials. I ' m pleased to announce that we have met that milestone with the IDE application submitted in Q3. Looking across the enterprise, our high innovation, high growth strategy is working and our progress this quarter speaks to the strength of our commercial and innovation capabilities. We have increased adjusted operational EPS guidance pre - M&A for the third quarter in a row. We have invested $18 billion in high innovation, high growth M&A this year. Based on this quarter 's results, we are confident in our expectations for 2025 through the end of the decade and beyond. And with that, I will turn the call back to Jess.", "ground_truth_output": { "entities": [ { "id": 1, "label": "Value", "start_offset": 126, "end_offset": 130, "text": "6.3%", "global_span": [ 2700, 2704 ] }, { "id": 2, "label": "Traditional", "start_offset": 131, "end_offset": 155, "text": "operational sales growth", "global_span": [ 2705, 2729 ] }, { "id": 3, "label": "Traditional", "start_offset": 695, "end_offset": 714, "text": "Innovative Medicine", "global_span": [ 3269, 3288 ] }, { "id": 4, "label": "Traditional", "start_offset": 760, "end_offset": 765, "text": "sales", "global_span": [ 3334, 3339 ] }, { "id": 5, "label": "Value", "start_offset": 776, "end_offset": 787, "text": "$14 billion", "global_span": [ 3350, 3361 ] }, { "id": 6, "label": "Traditional", "start_offset": 832, "end_offset": 840, "text": "DARZALEX", "global_span": [ 3406, 3414 ] }, { "id": 7, "label": "Value", "start_offset": 892, "end_offset": 902, "text": "$3 billion", "global_span": [ 3466, 3476 ] }, { "id": 8, "label": "Traditional", "start_offset": 906, "end_offset": 911, "text": "sales", "global_span": [ 3480, 3485 ] }, { "id": 9, "label": "Non_Traditional", "start_offset": 1106, "end_offset": 1118, "text": "FDA approval", "global_span": [ 3680, 3692 ] }, { "id": 10, "label": "Value", "start_offset": 1122, "end_offset": 1131, "text": "RYBREVANT", "global_span": [ 3696, 3705 ] }, { "id": 11, "label": "Value", "start_offset": 1137, "end_offset": 1145, "text": "LAZCLUZE", "global_span": [ 3711, 3719 ] }, { "id": 12, "label": "Non_Traditional", "start_offset": 1149, "end_offset": 1154, "text": "first", "global_span": [ 3723, 3728 ] }, { "id": 13, "label": "Traditional", "start_offset": 1261, "end_offset": 1264, "text": "FDA", "global_span": [ 3835, 3838 ] }, { "id": 14, "label": "Non_Traditional", "start_offset": 2523, "end_offset": 2553, "text": "OTTAVA robotic surgical system", "global_span": [ 5097, 5127 ] }, { "id": 15, "label": "Non_Traditional", "start_offset": 2561, "end_offset": 2576, "text": "investigational", "global_span": [ 5135, 5150 ] }, { "id": 16, "label": "Non_Traditional", "start_offset": 2649, "end_offset": 2673, "text": "initiate clinical trials", "global_span": [ 5223, 5247 ] }, { "id": 17, "label": "Value", "start_offset": 2714, "end_offset": 2717, "text": "met", "global_span": [ 5288, 5291 ] }, { "id": 18, "label": "Traditional", "start_offset": 2998, "end_offset": 3014, "text": "EPS guidance pre", "global_span": [ 5572, 5588 ] }, { "id": 19, "label": "Traditional", "start_offset": 3017, "end_offset": 3020, "text": "M&A", "global_span": [ 5591, 5594 ] }, { "id": 20, "label": "Traditional", "start_offset": 3061, "end_offset": 3069, "text": "invested", "global_span": [ 5635, 5643 ] }, { "id": 21, "label": "Value", "start_offset": 3070, "end_offset": 3081, "text": "$18 billion", "global_span": [ 5644, 5655 ] }, { "id": 22, "label": "Traditional", "start_offset": 3085, "end_offset": 3100, "text": "high innovation", "global_span": [ 5659, 5674 ] }, { "id": 309, "label": "non_traditional", "text": "TREMFYA for active ulcerative colitis", "start_offset": 1277, "end_offset": 1314, "global_span": [ 3851, 3888 ] }, { "id": 310, "label": "non_traditional", "text": "approval", "start_offset": 1265, "end_offset": 1273, "global_span": [ 3839, 3847 ] }, { "id": 311, "label": "non_traditional", "text": " IDE application submitted", "start_offset": 2741, "end_offset": 2767, "global_span": [ 5315, 5341 ] }, { "id": 312, "label": "Value", "text": "increased ", "start_offset": 2967, "end_offset": 2977, "global_span": [ 5541, 5551 ] } ], "relations": [ { "id": 1, "entity_ids": [ 1, 2 ], "description": "Value_of" }, { "id": 2, "entity_ids": [ 3, 4, 5 ], "description": "Value_of" }, { "id": 3, "entity_ids": [ 6, 7, 8 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 9, 10 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 9, 11 ], "description": "Value_of" }, { "id": 6, "entity_ids": [ 13, 309, 310 ], "description": "Value_of" }, { "id": 7, "entity_ids": [ 14, 15, 16, 17, 311 ], "description": "Value_of" }, { "id": 8, "entity_ids": [ 18, 19, 312 ], "description": "Value_of" }, { "id": 9, "entity_ids": [ 20, 21, 22 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Jessica Moore: Thank you, Joaquin. Moving to our financial results for the quarter. Unless otherwise stated, the financial results and guidance highlighted today reflect the continuing operations of Johnson & Johnson. Furthermore, the percentages quoted represent operational results and, therefore, exclude the impact of currency translation. Worldwide sales were $22.5 billion for the third quarter of 2024. Sales increased 6.3%, with growth of 7.6% in the U.S. and 4.6% outside of the U.S. Acquisitions and divestitures positively impacted worldwide growth by 90 basis points. Turning now to earnings. For the quarter, net earnings were $2.7 billion and diluted earnings per share was $1.11 versus diluted earnings per share of $1.69 a year ago. Results in the quarter were impacted by the updated talc litigation settlement proposal, as well as acquired IPR&D expense associated with the NM26 bispecific antibody. Excluding after - tax intangible asset amortization expense and special items for both periods, adjusted net earnings for the quarter were $5.9 billion and adjusted diluted earnings per share was $2.42, representing decreases of 13.3% and 9%, respectively, compared to the third quarter of 2023. Results were impacted by the acquired IPR&D expense of $1.25 billion or approximately 1,900 basis points associated with the NM26 bispecific antibody. I will now comment on business sales performance in the quarter. Beginning with Innovative Medicine. Worldwide sales of $14.6 billion increased 6.3%, with growth of 7.5% in the U.S. and 4.4% outside of the U.S. Innovative Medicine growth was driven by our key brands and continued uptake from recently launched products, with 11 assets delivering double - digit growth. Results across the portfolio continue to be positively impacted by price increases associated with Argentina hyperinflation, consistent with market practice. We continue to drive strong sales growth across our multiple myeloma portfolio. DARZALEX growth was 22.9%, primarily driven by share gains of 4 points across all lines of therapy, with 7.7 points of growth in the front line setting as well as market growth. CARVYKTI achieved sales of $286 million, with growth of 87.6%, driven by share gains, continued capacity expansion and manufacturing efficiencies. This reflects sequential growth of 53.2% aligned with our expectations of accelerating growth in the back half of the year. TECVAYLI sales were $135 million in the quarter with growth of 21.4%, reflecting a strong launch in the relapsed refractory setting. Demand remained strong, while sequential growth was flat due to continued adoption of longer duration dosing intervals. Finally, within our multiple myeloma portfolio, TALVEY continued its launch trajectory with another quarter of strong growth. We anticipate disclosing TALVEY sales in the first quarter of 2025, which are currently reported in other oncology. ERLEADA continues to deliver strong growth of 26.3%, primarily driven by share gains in metastatic castrate sensitive prostate cancer and favorable inventory dynamics. RYBREVANT, our bispecific antibody for non - small cell lung cancer, contributed to growth in other oncology as we expand approved indications. We also anticipate disclosing RYBREVANT sales in the first quarter of 2025. Within immunology, we saw sales growth in TREMFYA of 14.3%, driven by strong market growth and share gains in PsO and PsA, partially offset by unfavorable patient mix. STELARA declined 5.7%, driven by unfavorable net patient mix and share loss, partially offset by market growth. As a reminder, biosimilar competition has entered Europe as of July, and we anticipate U.S. biosimilar entry in January 2025. In neuroscience, SPRAVATO growth of 55.3% continues to be driven by increased physician and patient confidence. In pulmonary hypertension, OPSUMIT and UPTRAVI grew 17.4% and 15.2%, respectively, driven by market growth, share gains and patient mix. As mentioned last quarter, REMICADE and SIMPONI realized limited sales in Europe as we prepare for the return of distribution rights in Q4. I 'll now turn your attention to MedTech. Worldwide sales of $7.9 billion increased 6.4% with growth in the U.S. of 7.8% and 5% outside of the U.S. Acquisitions and divestitures had a net positive impact of 270 basis points on worldwide growth, 360 basis points in the U.S. and 180 basis points outside of the U.S. Overall, MedTech growth was driven by commercial execution and strength of new product introductions, partially offset by continued headwinds in Asia Pacific, specifically in China. In Cardiovascular, electrophysiology delivered double - digit growth of 10.7%. Performance was driven by global procedure growth, new product uptake and commercial execution, partially offset by competitive PFA ablation catheter uptake in the U.S., as well as prior year trade inventory dynamics and VBP in China. Abiomed delivered growth of 16.3%, driven by strong growth in all regions and continued adoption of Impella 5.5 and Impella RP technology. Cardiovascular results also included $229 million associated with the acquisition of Shockwave. Contact lenses and other performance improved to 4.7%, driven by continued strategic price actions, strong performance in ACUVUE OASYS 1 - Day family of products, a one - time benefit from a change in U.S. contract shipping terms worth approximately 150 basis points, as well as lapping prior year impacts from Russia sanctions. Surgical Vision grew 1.9%, driven by TECNIS PureSee and TECNIS Eyhance, partially offset by China VBP and softness in the U.S. Surgery declined 0.7%, with the Acclarent divestiture negatively impacting results by approximately 110 basis points. Performance was driven primarily by competitive pressures in energy and endocutters, as well as VBP and the anticorruption campaign in China. This was partially offset by commercial execution, strength of new products across wound closure and biosurgery and continued price increases associated with Argentina hyperinflation consistent with market practice. Orthopaedics growth of 1.3% was primarily driven by success of recent product launches and commercial execution, partially offset by competitive pressures, impacts of China VBP and revenue disruption from the previously announced Orthopaedics transformation. Now, turning to our consolidated statement of earnings for the third quarter of 2024. I 'd like to highlight a few noteworthy items that have changed compared to the same quarter of last year. We continue to invest strategically in research and development at competitive levels, investing nearly $5 billion or 22% of sales, which includes a $1.25 billion payment to secure the global rights to NM26 bispecific antibody. Even when excluding this investment, R&D as a percent of sales increased 30 basis points. Selling, marketing and administrative expense as a percent of sales was leveraged 100 basis points, driven by the realization of optimization efforts following the Kenvue separation. Interest income was $99 million as compared to $182 million of income last year, driven by a higher net debt position primarily related to the financing impacts of the Shockwave acquisition. Other income and expense was a net expense of $1.8 billion compared to an expense of $0.5 billion in the prior year. The increase in expense was driven by a $1.75 billion charge related to the talc litigation settlement proposal, partially offset by prior year higher unrealized mark to market losses on public securities, as well as the monetization of royalty rights. Regarding taxes in the quarter, our effective tax rate was 19.3% versus 17.4% in the same period last year. This increase was primarily driven by the tax treatment of the NM26 bispecific antibody acquisition and OECD Pillar 2. Excluding special items, the effective tax rate was 19.3% versus 15.6% in the same period last year. I encourage you to review our upcoming third quarter 10 - Q filing for additional details on specific tax - related matters. Lastly, I 'll direct your attention to the box section of the slide where we have also provided our income before tax, net earnings and earnings per share adjusted to exclude the impact of intangible amortization expense and special items. Now, let 's look at adjusted income before tax [by segment ] (ph). Innovative Medicine margin declined from 45.4% to 37.9%, primarily driven by the $1.25 billion acquired IPR&D expense to secure the global rights for NM26 bispecific antibody, partially offset by the monetization of royalty rights. MedTech margin declined from 24.7% to 24.1%, driven by increased R&D investment and lapping of a prior year divestiture gain, partially offset by supply chain efficiencies. As a result, adjusted income before tax for the enterprise as a percentage of sales decreased from 37.6% to 32.4%, with acquired IPR&D expense impacting results by 560 basis points. Starting in 2025, aligned with recent FASB reporting disclosure requirements, we will begin providing additional P&L details by segment. This concludes the sales and earnings portion of the call. I ' m now pleased to turn it over to Joe.", "ground_truth_output": { "entities": [ { "id": 23, "label": "Traditional", "start_offset": 345, "end_offset": 360, "text": "Worldwide sales", "global_span": [ 6219, 6234 ] }, { "id": 24, "label": "Value", "start_offset": 367, "end_offset": 379, "text": "22.5 billion", "global_span": [ 6241, 6253 ] }, { "id": 25, "label": "Traditional", "start_offset": 388, "end_offset": 401, "text": "third quarter", "global_span": [ 6262, 6275 ] }, { "id": 26, "label": "Traditional", "start_offset": 411, "end_offset": 416, "text": "Sales", "global_span": [ 6285, 6290 ] }, { "id": 27, "label": "Value", "start_offset": 427, "end_offset": 431, "text": "6.3%", "global_span": [ 6301, 6305 ] }, { "id": 28, "label": "Traditional", "start_offset": 438, "end_offset": 444, "text": "growth", "global_span": [ 6312, 6318 ] }, { "id": 29, "label": "Value", "start_offset": 448, "end_offset": 452, "text": "7.6%", "global_span": [ 6322, 6326 ] }, { "id": 30, "label": "Value", "start_offset": 469, "end_offset": 473, "text": "4.6%", "global_span": [ 6343, 6347 ] }, { "id": 31, "label": "Traditional", "start_offset": 494, "end_offset": 506, "text": "Acquisitions", "global_span": [ 6368, 6380 ] }, { "id": 32, "label": "Traditional", "start_offset": 511, "end_offset": 523, "text": "divestitures", "global_span": [ 6385, 6397 ] }, { "id": 33, "label": "Traditional", "start_offset": 544, "end_offset": 560, "text": "worldwide growth", "global_span": [ 6418, 6434 ] }, { "id": 34, "label": "Value", "start_offset": 564, "end_offset": 579, "text": "90 basis points", "global_span": [ 6438, 6453 ] }, { "id": 35, "label": "Value", "start_offset": 641, "end_offset": 653, "text": "$2.7 billion", "global_span": [ 6515, 6527 ] }, { "id": 36, "label": "Value", "start_offset": 689, "end_offset": 694, "text": "$1.11", "global_span": [ 6563, 6568 ] }, { "id": 37, "label": "Value", "start_offset": 732, "end_offset": 737, "text": "$1.69", "global_span": [ 6606, 6611 ] }, { "id": 38, "label": "Traditional", "start_offset": 919, "end_offset": 934, "text": "Excluding after", "global_span": [ 6793, 6808 ] }, { "id": 39, "label": "Traditional", "start_offset": 937, "end_offset": 951, "text": "tax intangible", "global_span": [ 6811, 6825 ] }, { "id": 40, "label": "Traditional", "start_offset": 958, "end_offset": 978, "text": "amortization expense", "global_span": [ 6832, 6852 ] }, { "id": 41, "label": "Traditional", "start_offset": 983, "end_offset": 996, "text": "special items", "global_span": [ 6857, 6870 ] }, { "id": 42, "label": "Traditional", "start_offset": 1015, "end_offset": 1036, "text": "adjusted net earnings", "global_span": [ 6889, 6910 ] }, { "id": 43, "label": "Traditional", "start_offset": 1058, "end_offset": 1059, "text": "$", "global_span": [ 6932, 6933 ] }, { "id": 44, "label": "Value", "start_offset": 1059, "end_offset": 1070, "text": "5.9 billion", "global_span": [ 6933, 6944 ] }, { "id": 45, "label": "Traditional", "start_offset": 1075, "end_offset": 1110, "text": "adjusted diluted earnings per share", "global_span": [ 6949, 6984 ] }, { "id": 46, "label": "Value", "start_offset": 1115, "end_offset": 1120, "text": "$2.42", "global_span": [ 6989, 6994 ] }, { "id": 47, "label": "Value", "start_offset": 1148, "end_offset": 1153, "text": "13.3%", "global_span": [ 7022, 7027 ] }, { "id": 48, "label": "Value", "start_offset": 1158, "end_offset": 1160, "text": "9%", "global_span": [ 7032, 7034 ] }, { "id": 49, "label": "Value", "start_offset": 1271, "end_offset": 1283, "text": "1.25 billion", "global_span": [ 7145, 7157 ] }, { "id": 50, "label": "Value", "start_offset": 1301, "end_offset": 1306, "text": "1,900", "global_span": [ 7175, 7180 ] }, { "id": 51, "label": "Traditional", "start_offset": 1307, "end_offset": 1319, "text": "basis points", "global_span": [ 7181, 7193 ] }, { "id": 52, "label": "Traditional", "start_offset": 1446, "end_offset": 1465, "text": "Innovative Medicine", "global_span": [ 7320, 7339 ] }, { "id": 53, "label": "Traditional", "start_offset": 1467, "end_offset": 1482, "text": "Worldwide sales", "global_span": [ 7341, 7356 ] }, { "id": 54, "label": "Value", "start_offset": 1487, "end_offset": 1499, "text": "14.6 billion", "global_span": [ 7361, 7373 ] }, { "id": 55, "label": "Value", "start_offset": 1510, "end_offset": 1514, "text": "6.3%", "global_span": [ 7384, 7388 ] }, { "id": 56, "label": "Value", "start_offset": 1531, "end_offset": 1535, "text": "7.5%", "global_span": [ 7405, 7409 ] }, { "id": 57, "label": "Value", "start_offset": 1552, "end_offset": 1556, "text": "4.4%", "global_span": [ 7426, 7430 ] }, { "id": 58, "label": "Value", "start_offset": 1994, "end_offset": 1999, "text": "22.9%", "global_span": [ 7868, 7873 ] }, { "id": 59, "label": "Value", "start_offset": 2036, "end_offset": 2044, "text": "4 points", "global_span": [ 7910, 7918 ] }, { "id": 60, "label": "Value", "start_offset": 2079, "end_offset": 2089, "text": "7.7 points", "global_span": [ 7953, 7963 ] }, { "id": 61, "label": "Traditional", "start_offset": 2152, "end_offset": 2160, "text": "CARVYKTI", "global_span": [ 8026, 8034 ] }, { "id": 62, "label": "Traditional", "start_offset": 2170, "end_offset": 2175, "text": "sales", "global_span": [ 8044, 8049 ] }, { "id": 63, "label": "Value", "start_offset": 2179, "end_offset": 2191, "text": "$286 million", "global_span": [ 8053, 8065 ] }, { "id": 64, "label": "Value", "start_offset": 2208, "end_offset": 2213, "text": "87.6%", "global_span": [ 8082, 8087 ] }, { "id": 65, "label": "Traditional", "start_offset": 2225, "end_offset": 2236, "text": "share gains", "global_span": [ 8099, 8110 ] }, { "id": 66, "label": "Traditional", "start_offset": 2313, "end_offset": 2330, "text": "sequential growth", "global_span": [ 8187, 8204 ] }, { "id": 67, "label": "Value", "start_offset": 2334, "end_offset": 2339, "text": "53.2%", "global_span": [ 8208, 8213 ] }, { "id": 68, "label": "Traditional", "start_offset": 2423, "end_offset": 2437, "text": "TECVAYLI sales", "global_span": [ 8297, 8311 ] }, { "id": 69, "label": "Value", "start_offset": 2443, "end_offset": 2455, "text": "$135 million", "global_span": [ 8317, 8329 ] }, { "id": 70, "label": "Value", "start_offset": 2486, "end_offset": 2491, "text": "21.4%", "global_span": [ 8360, 8365 ] }, { "id": 71, "label": "Traditional", "start_offset": 2918, "end_offset": 2925, "text": "ERLEADA", "global_span": [ 8792, 8799 ] }, { "id": 72, "label": "Traditional", "start_offset": 2954, "end_offset": 2960, "text": "growth", "global_span": [ 8828, 8834 ] }, { "id": 73, "label": "Value", "start_offset": 2964, "end_offset": 2969, "text": "26.3%", "global_span": [ 8838, 8843 ] }, { "id": 74, "label": "Traditional", "start_offset": 3332, "end_offset": 3344, "text": "sales growth", "global_span": [ 9206, 9218 ] }, { "id": 75, "label": "Traditional", "start_offset": 3348, "end_offset": 3355, "text": "TREMFYA", "global_span": [ 9222, 9229 ] }, { "id": 76, "label": "Value", "start_offset": 3359, "end_offset": 3364, "text": "14.3%", "global_span": [ 9233, 9238 ] }, { "id": 77, "label": "Traditional", "start_offset": 3474, "end_offset": 3490, "text": "STELARA declined", "global_span": [ 9348, 9364 ] }, { "id": 78, "label": "Value", "start_offset": 3491, "end_offset": 3495, "text": "5.7%", "global_span": [ 9365, 9369 ] }, { "id": 79, "label": "Traditional", "start_offset": 3729, "end_offset": 3744, "text": "SPRAVATO growth", "global_span": [ 9603, 9618 ] }, { "id": 80, "label": "Value", "start_offset": 3748, "end_offset": 3753, "text": "55.3%", "global_span": [ 9622, 9627 ] }, { "id": 81, "label": "Traditional", "start_offset": 3851, "end_offset": 3858, "text": "OPSUMIT", "global_span": [ 9725, 9732 ] }, { "id": 82, "label": "Traditional", "start_offset": 3863, "end_offset": 3870, "text": "UPTRAVI", "global_span": [ 9737, 9744 ] }, { "id": 83, "label": "Value", "start_offset": 3876, "end_offset": 3881, "text": "17.4%", "global_span": [ 9750, 9755 ] }, { "id": 84, "label": "Value", "start_offset": 3886, "end_offset": 3891, "text": "15.2%", "global_span": [ 9760, 9765 ] }, { "id": 85, "label": "Traditional", "start_offset": 4143, "end_offset": 4158, "text": "Worldwide sales", "global_span": [ 10017, 10032 ] }, { "id": 86, "label": "Value", "start_offset": 4162, "end_offset": 4174, "text": "$7.9 billion", "global_span": [ 10036, 10048 ] }, { "id": 87, "label": "Value", "start_offset": 4185, "end_offset": 4189, "text": "6.4%", "global_span": [ 10059, 10063 ] }, { "id": 88, "label": "Value", "start_offset": 4217, "end_offset": 4221, "text": "7.8%", "global_span": [ 10091, 10095 ] }, { "id": 89, "label": "Value", "start_offset": 4226, "end_offset": 4228, "text": "5%", "global_span": [ 10100, 10102 ] }, { "id": 90, "label": "Traditional", "start_offset": 4229, "end_offset": 4236, "text": "outside", "global_span": [ 10103, 10110 ] }, { "id": 91, "label": "Traditional", "start_offset": 4244, "end_offset": 4261, "text": "U.S. Acquisitions", "global_span": [ 10118, 10135 ] }, { "id": 92, "label": "Traditional", "start_offset": 4266, "end_offset": 4278, "text": "divestitures", "global_span": [ 10140, 10152 ] }, { "id": 93, "label": "Value", "start_offset": 4308, "end_offset": 4324, "text": "270 basis points", "global_span": [ 10182, 10198 ] }, { "id": 94, "label": "Traditional", "start_offset": 4328, "end_offset": 4344, "text": "worldwide growth", "global_span": [ 10202, 10218 ] }, { "id": 95, "label": "Value", "start_offset": 4346, "end_offset": 4362, "text": "360 basis points", "global_span": [ 10220, 10236 ] }, { "id": 96, "label": "Traditional", "start_offset": 4370, "end_offset": 4374, "text": "U.S.", "global_span": [ 10244, 10248 ] }, { "id": 97, "label": "Value", "start_offset": 4379, "end_offset": 4395, "text": "180 basis points", "global_span": [ 10253, 10269 ] }, { "id": 98, "label": "Traditional", "start_offset": 4601, "end_offset": 4615, "text": "Cardiovascular", "global_span": [ 10475, 10489 ] }, { "id": 99, "label": "Traditional", "start_offset": 4617, "end_offset": 4634, "text": "electrophysiology", "global_span": [ 10491, 10508 ] }, { "id": 100, "label": "Traditional", "start_offset": 4660, "end_offset": 4666, "text": "growth", "global_span": [ 10534, 10540 ] }, { "id": 101, "label": "Value", "start_offset": 4670, "end_offset": 4675, "text": "10.7%", "global_span": [ 10544, 10549 ] }, { "id": 102, "label": "Traditional", "start_offset": 4912, "end_offset": 4919, "text": "Abiomed", "global_span": [ 10786, 10793 ] }, { "id": 103, "label": "Value", "start_offset": 4940, "end_offset": 4945, "text": "16.3%", "global_span": [ 10814, 10819 ] }, { "id": 104, "label": "Traditional", "start_offset": 5051, "end_offset": 5073, "text": "Cardiovascular results", "global_span": [ 10925, 10947 ] }, { "id": 105, "label": "Value", "start_offset": 5088, "end_offset": 5100, "text": "$229 million", "global_span": [ 10962, 10974 ] }, { "id": 106, "label": "Traditional", "start_offset": 5147, "end_offset": 5161, "text": "Contact lenses", "global_span": [ 11021, 11035 ] }, { "id": 107, "label": "Traditional", "start_offset": 5166, "end_offset": 5183, "text": "other performance", "global_span": [ 11040, 11057 ] }, { "id": 108, "label": "Value", "start_offset": 5196, "end_offset": 5200, "text": "4.7%", "global_span": [ 11070, 11074 ] }, { "id": 109, "label": "Value", "start_offset": 5397, "end_offset": 5413, "text": "150 basis points", "global_span": [ 11271, 11287 ] }, { "id": 110, "label": "Traditional", "start_offset": 5476, "end_offset": 5491, "text": "Surgical Vision", "global_span": [ 11350, 11365 ] }, { "id": 111, "label": "Value", "start_offset": 5497, "end_offset": 5501, "text": "1.9%", "global_span": [ 11371, 11375 ] }, { "id": 112, "label": "Value", "start_offset": 5620, "end_offset": 5624, "text": "0.7%", "global_span": [ 11494, 11498 ] }, { "id": 113, "label": "Value", "start_offset": 5703, "end_offset": 5719, "text": "110 basis points", "global_span": [ 11577, 11593 ] }, { "id": 114, "label": "Traditional", "start_offset": 6079, "end_offset": 6098, "text": "Orthopaedics growth", "global_span": [ 11953, 11972 ] }, { "id": 115, "label": "Value", "start_offset": 6102, "end_offset": 6106, "text": "1.3%", "global_span": [ 11976, 11980 ] }, { "id": 116, "label": "Traditional", "start_offset": 6546, "end_offset": 6552, "text": "invest", "global_span": [ 12420, 12426 ] }, { "id": 117, "label": "Traditional", "start_offset": 6570, "end_offset": 6578, "text": "research", "global_span": [ 12444, 12452 ] }, { "id": 118, "label": "Traditional", "start_offset": 6583, "end_offset": 6594, "text": "development", "global_span": [ 12457, 12468 ] }, { "id": 119, "label": "Value", "start_offset": 6635, "end_offset": 6645, "text": "$5 billion", "global_span": [ 12509, 12519 ] }, { "id": 120, "label": "Value", "start_offset": 6649, "end_offset": 6652, "text": "22%", "global_span": [ 12523, 12526 ] }, { "id": 121, "label": "Traditional", "start_offset": 6656, "end_offset": 6661, "text": "sales", "global_span": [ 12530, 12535 ] }, { "id": 122, "label": "Value", "start_offset": 6681, "end_offset": 6693, "text": "1.25 billion", "global_span": [ 12555, 12567 ] }, { "id": 123, "label": "Value", "start_offset": 6832, "end_offset": 6847, "text": "30 basis points", "global_span": [ 12706, 12721 ] }, { "id": 124, "label": "Traditional", "start_offset": 6849, "end_offset": 6856, "text": "Selling", "global_span": [ 12723, 12730 ] }, { "id": 125, "label": "Traditional", "start_offset": 6858, "end_offset": 6867, "text": "marketing", "global_span": [ 12732, 12741 ] }, { "id": 126, "label": "Traditional", "start_offset": 6872, "end_offset": 6894, "text": "administrative expense", "global_span": [ 12746, 12768 ] }, { "id": 127, "label": "Traditional", "start_offset": 6900, "end_offset": 6916, "text": "percent of sales", "global_span": [ 12774, 12790 ] }, { "id": 128, "label": "Traditional", "start_offset": 6921, "end_offset": 6930, "text": "leveraged", "global_span": [ 12795, 12804 ] }, { "id": 129, "label": "Value", "start_offset": 6931, "end_offset": 6947, "text": "100 basis points", "global_span": [ 12805, 12821 ] }, { "id": 130, "label": "Traditional", "start_offset": 7032, "end_offset": 7047, "text": "Interest income", "global_span": [ 12906, 12921 ] }, { "id": 131, "label": "Value", "start_offset": 7052, "end_offset": 7063, "text": "$99 million", "global_span": [ 12926, 12937 ] }, { "id": 132, "label": "Value", "start_offset": 7079, "end_offset": 7091, "text": "$182 million", "global_span": [ 12953, 12965 ] }, { "id": 133, "label": "Traditional", "start_offset": 7223, "end_offset": 7235, "text": "Other income", "global_span": [ 13097, 13109 ] }, { "id": 134, "label": "Traditional", "start_offset": 7240, "end_offset": 7247, "text": "expense", "global_span": [ 13114, 13121 ] }, { "id": 135, "label": "Value", "start_offset": 7269, "end_offset": 7281, "text": "$1.8 billion", "global_span": [ 13143, 13155 ] }, { "id": 136, "label": "Value", "start_offset": 7308, "end_offset": 7320, "text": "$0.5 billion", "global_span": [ 13182, 13194 ] }, { "id": 137, "label": "Traditional", "start_offset": 7344, "end_offset": 7352, "text": "increase", "global_span": [ 13218, 13226 ] }, { "id": 138, "label": "Traditional", "start_offset": 7356, "end_offset": 7363, "text": "expense", "global_span": [ 13230, 13237 ] }, { "id": 139, "label": "Value", "start_offset": 7380, "end_offset": 7393, "text": "$1.75 billion", "global_span": [ 13254, 13267 ] }, { "id": 140, "label": "Traditional", "start_offset": 7629, "end_offset": 7647, "text": "effective tax rate", "global_span": [ 13503, 13521 ] }, { "id": 141, "label": "Value", "start_offset": 7652, "end_offset": 7657, "text": "19.3%", "global_span": [ 13526, 13531 ] }, { "id": 142, "label": "Value", "start_offset": 7665, "end_offset": 7670, "text": "17.4%", "global_span": [ 13539, 13544 ] }, { "id": 143, "label": "Traditional", "start_offset": 7820, "end_offset": 7843, "text": "Excluding special items", "global_span": [ 13694, 13717 ] }, { "id": 144, "label": "Traditional", "start_offset": 7849, "end_offset": 7867, "text": "effective tax rate", "global_span": [ 13723, 13741 ] }, { "id": 145, "label": "Value", "start_offset": 7872, "end_offset": 7877, "text": "19.3%", "global_span": [ 13746, 13751 ] }, { "id": 146, "label": "Value", "start_offset": 7885, "end_offset": 7890, "text": "15.6%", "global_span": [ 13759, 13764 ] }, { "id": 147, "label": "Traditional", "start_offset": 8353, "end_offset": 8372, "text": "Innovative Medicine", "global_span": [ 14227, 14246 ] }, { "id": 148, "label": "Traditional", "start_offset": 8380, "end_offset": 8388, "text": "declined", "global_span": [ 14254, 14262 ] }, { "id": 149, "label": "Value", "start_offset": 8394, "end_offset": 8399, "text": "45.4%", "global_span": [ 14268, 14273 ] }, { "id": 150, "label": "Value", "start_offset": 8403, "end_offset": 8408, "text": "37.9%", "global_span": [ 14277, 14282 ] }, { "id": 151, "label": "Value", "start_offset": 8434, "end_offset": 8447, "text": "$1.25 billion", "global_span": [ 14308, 14321 ] }, { "id": 152, "label": "Non_Traditional", "start_offset": 8457, "end_offset": 8470, "text": "IPR&D expense", "global_span": [ 14331, 14344 ] }, { "id": 153, "label": "Traditional", "start_offset": 8585, "end_offset": 8608, "text": "MedTech margin declined", "global_span": [ 14459, 14482 ] }, { "id": 154, "label": "Value", "start_offset": 8614, "end_offset": 8619, "text": "24.7%", "global_span": [ 14488, 14493 ] }, { "id": 155, "label": "Value", "start_offset": 8623, "end_offset": 8628, "text": "24.1%", "global_span": [ 14497, 14502 ] }, { "id": 156, "label": "Traditional", "start_offset": 8771, "end_offset": 8797, "text": "adjusted income before tax", "global_span": [ 14645, 14671 ] }, { "id": 157, "label": "Traditional", "start_offset": 8822, "end_offset": 8841, "text": "percentage of sales", "global_span": [ 14696, 14715 ] }, { "id": 158, "label": "Value", "start_offset": 8857, "end_offset": 8862, "text": "37.6%", "global_span": [ 14731, 14736 ] }, { "id": 159, "label": "Value", "start_offset": 8866, "end_offset": 8871, "text": "32.4%", "global_span": [ 14740, 14745 ] }, { "id": 160, "label": "Value", "start_offset": 8922, "end_offset": 8938, "text": "560 basis points", "global_span": [ 14796, 14812 ] }, { "id": 313, "label": "Traditional", "text": "increased ", "start_offset": 417, "end_offset": 427, "global_span": [ 6291, 6301 ] }, { "id": 314, "label": "Traditional", "text": "in the U.S", "start_offset": 453, "end_offset": 463, "global_span": [ 6327, 6337 ] }, { "id": 315, "label": "Traditional", "text": "outside of the U.S", "start_offset": 474, "end_offset": 492, "global_span": [ 6348, 6366 ] }, { "id": 316, "label": "Traditional", "text": "net earnings", "start_offset": 623, "end_offset": 635, "global_span": [ 6497, 6509 ] }, { "id": 317, "label": "Traditional", "text": "diluted earnings per share", "start_offset": 658, "end_offset": 684, "global_span": [ 6532, 6558 ] }, { "id": 318, "label": "Traditional", "text": "diluted earnings per share", "start_offset": 702, "end_offset": 728, "global_span": [ 6576, 6602 ] }, { "id": 319, "label": "Traditional", "text": "acquired IPR&D expense", "start_offset": 1244, "end_offset": 1266, "global_span": [ 7118, 7140 ] }, { "id": 320, "label": "Traditional", "text": "in the U.S.", "start_offset": 1536, "end_offset": 1547, "global_span": [ 7410, 7421 ] }, { "id": 321, "label": "Traditional", "text": "outside of the U.S", "start_offset": 1557, "end_offset": 1575, "global_span": [ 7431, 7449 ] }, { "id": 322, "label": "non_traditional", "text": "DARZALEX growth", "start_offset": 1974, "end_offset": 1989, "global_span": [ 7848, 7863 ] }, { "id": 323, "label": "non_traditional", "text": "across all lines of therapy", "start_offset": 2045, "end_offset": 2072, "global_span": [ 7919, 7946 ] }, { "id": 324, "label": "non_traditional", "text": "growth in the front line setting", "start_offset": 2093, "end_offset": 2125, "global_span": [ 7967, 7999 ] }, { "id": 325, "label": "Traditional", "text": "with growth in the U.S", "start_offset": 4190, "end_offset": 4212, "global_span": [ 10064, 10086 ] }, { "id": 326, "label": "Traditional", "text": "MedTech", "start_offset": 4134, "end_offset": 4141, "global_span": [ 10008, 10015 ] }, { "id": 327, "label": "Traditional", "text": "of the U.S", "start_offset": 4237, "end_offset": 4247, "global_span": [ 10111, 10121 ] }, { "id": 328, "label": "Traditional", "text": "outside of the U.S", "start_offset": 4396, "end_offset": 4414, "global_span": [ 10270, 10288 ] }, { "id": 329, "label": "Traditional", "text": "last year", "start_offset": 7102, "end_offset": 7111, "global_span": [ 12976, 12985 ] }, { "id": 330, "label": "Traditional", "text": "same period last year", "start_offset": 7678, "end_offset": 7699, "global_span": [ 13552, 13573 ] }, { "id": 331, "label": "Traditional", "text": "margin ", "start_offset": 8373, "end_offset": 8380, "global_span": [ 14247, 14254 ] } ], "relations": [ { "id": 10, "entity_ids": [ 23, 24, 25 ], "description": "Value_of" }, { "id": 11, "entity_ids": [ 26, 27, 313 ], "description": "Value_of" }, { "id": 12, "entity_ids": [ 26, 28, 29, 314 ], "description": "Value_of" }, { "id": 13, "entity_ids": [ 26, 28, 30, 315 ], "description": "Value_of" }, { "id": 14, "entity_ids": [ 31, 32, 33, 34 ], "description": "Value_of" }, { "id": 15, "entity_ids": [ 35, 316 ], "description": "Value_of" }, { "id": 16, "entity_ids": [ 36, 317 ], "description": "Value_of" }, { "id": 17, "entity_ids": [ 37, 318 ], "description": "Value_of" }, { "id": 18, "entity_ids": [ 38, 39, 40, 41, 42, 43, 44 ], "description": "Value_of" }, { "id": 19, "entity_ids": [ 45, 46 ], "description": "Value_of" }, { "id": 20, "entity_ids": [ 45, 47, 48 ], "description": "Value_of" }, { "id": 21, "entity_ids": [ 49, 319 ], "description": "Value_of" }, { "id": 22, "entity_ids": [ 50, 51, 319 ], "description": "Value_of" }, { "id": 23, "entity_ids": [ 52, 53, 54 ], "description": "Value_of" }, { "id": 24, "entity_ids": [ 52, 53, 55 ], "description": "Value_of" }, { "id": 25, "entity_ids": [ 52, 53, 56, 320 ], "description": "Value_of" }, { "id": 26, "entity_ids": [ 52, 53, 57, 321 ], "description": "Value_of" }, { "id": 27, "entity_ids": [ 58, 322 ], "description": "Value_of" }, { "id": 28, "entity_ids": [ 59, 322, 323 ], "description": "Value_of" }, { "id": 29, "entity_ids": [ 60, 322, 324 ], "description": "Value_of" }, { "id": 30, "entity_ids": [ 61, 62, 63 ], "description": "Value_of" }, { "id": 31, "entity_ids": [ 61, 62, 64 ], "description": "Value_of" }, { "id": 32, "entity_ids": [ 61, 65 ], "description": "Value_of" }, { "id": 33, "entity_ids": [ 61, 66, 67 ], "description": "Value_of" }, { "id": 34, "entity_ids": [ 68, 69 ], "description": "Value_of" }, { "id": 35, "entity_ids": [ 68, 70 ], "description": "Value_of" }, { "id": 36, "entity_ids": [ 71, 72, 73 ], "description": "Value_of" }, { "id": 37, "entity_ids": [ 74, 75, 76 ], "description": "Value_of" }, { "id": 38, "entity_ids": [ 77, 78 ], "description": "Value_of" }, { "id": 39, "entity_ids": [ 79, 80 ], "description": "Value_of" }, { "id": 40, "entity_ids": [ 81, 83 ], "description": "Value_of" }, { "id": 41, "entity_ids": [ 82, 84 ], "description": "Value_of" }, { "id": 42, "entity_ids": [ 85, 86 ], "description": "Value_of" }, { "id": 43, "entity_ids": [ 85, 87 ], "description": "Value_of" }, { "id": 44, "entity_ids": [ 85, 88, 325, 326 ], "description": "Value_of" }, { "id": 45, "entity_ids": [ 85, 89, 90, 326, 327 ], "description": "Value_of" }, { "id": 46, "entity_ids": [ 91, 92, 93, 94 ], "description": "Value_of" }, { "id": 47, "entity_ids": [ 92, 95, 96 ], "description": "Value_of" }, { "id": 48, "entity_ids": [ 92, 97, 328 ], "description": "Value_of" }, { "id": 49, "entity_ids": [ 98, 99, 100, 101 ], "description": "Value_of" }, { "id": 50, "entity_ids": [ 102, 103 ], "description": "Value_of" }, { "id": 51, "entity_ids": [ 104, 105 ], "description": "Value_of" }, { "id": 52, "entity_ids": [ 106, 107, 108 ], "description": "Value_of" }, { "id": 53, "entity_ids": [ 110, 111 ], "description": "Value_of" }, { "id": 54, "entity_ids": [ 114, 115 ], "description": "Value_of" }, { "id": 55, "entity_ids": [ 116, 117, 118, 119 ], "description": "Value_of" }, { "id": 56, "entity_ids": [ 116, 117, 118, 120, 121 ], "description": "Value_of" }, { "id": 57, "entity_ids": [ 116, 117, 118, 121, 123 ], "description": "Value_of" }, { "id": 58, "entity_ids": [ 124, 125, 126, 127, 128, 129 ], "description": "Value_of" }, { "id": 59, "entity_ids": [ 130, 131 ], "description": "Value_of" }, { "id": 60, "entity_ids": [ 130, 132, 329 ], "description": "Value_of" }, { "id": 61, "entity_ids": [ 133, 134, 135 ], "description": "Value_of" }, { "id": 62, "entity_ids": [ 137, 138, 139 ], "description": "Value_of" }, { "id": 63, "entity_ids": [ 140, 141 ], "description": "Value_of" }, { "id": 64, "entity_ids": [ 140, 142, 330 ], "description": "Value_of" }, { "id": 65, "entity_ids": [ 144, 145 ], "description": "Value_of" }, { "id": 66, "entity_ids": [ 144, 146 ], "description": "Value_of" }, { "id": 67, "entity_ids": [ 147, 148, 149, 331 ], "description": "Value_of" }, { "id": 68, "entity_ids": [ 147, 150, 331 ], "description": "Value_of" }, { "id": 69, "entity_ids": [ 151, 152 ], "description": "Value_of" }, { "id": 70, "entity_ids": [ 153, 154 ], "description": "Value_of" }, { "id": 71, "entity_ids": [ 153, 155 ], "description": "Value_of" }, { "id": 72, "entity_ids": [ 156, 157, 158 ], "description": "Value_of" }, { "id": 73, "entity_ids": [ 156, 157, 159 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "Joe Wolk: Thank you, Jessica. In the third quarter, Johnson & Johnson delivered results that illustrate not only the breadth of the business, but our ability to consistently beat financial expectations. Innovative Medicine continued to build on strong first - half revenue momentum. We are advancing our pharmaceutical pipeline, achieving significant clinical and regulatory milestones across key therapeutic areas. Our MedTech business, with the addition of Shockwave, delivered operational growth of 6.4% in the quarter, but did experience headwinds in the Asia Pacific region. We continue to fortify our future advancing the OTTAVA robotic surgery system to IDE, expanding VELYS use and launching new intraocular lenses. Due to dynamics in the Asia Pacific region, specifically in China, we are taking a responsibly conservative approach by assuming no material improvement in that part of the business for the remainder of this year. And as such, we expect MedTech adjusted operational sales growth for the full year 2024 to be closer to 5% versus the 6% we referenced last quarter. The strength of a diversified business enables us to more than offset volatility in one part of our business, but yet be in a position to once again increase 2024 guidance for the enterprise. Before diving into the results, I 'll take a moment to touch on some enterprise - wide updates from the quarter. We are making progress towards resolving talc litigation. Our pre - packaged bankruptcy plan received overwhelming support from the current claimants of roughly 83% as well as the future claimants representative. As announced last Thursday, the case will be heard in the Texas Bankruptcy Court. And while we remain committed to bringing this matter to a resolution, it would be premature to speculate on timing. In addition to the pipeline highlights Joaquin mentioned, there are some additional notable advancements throughout the quarter. In oncology, we received U.S. and EU regulatory approval for RYBREVANT in combination with chemotherapy as a second line treatment for adults with advanced EGFR - mutated non - small cell lung cancer. With FDA priority review underway for a subcutaneous formulation of RYBREVANT, along with data supporting a treatment regimen to reduce adverse events, we are building a best - in - class EGFR portfolio. We also presented Phase 1 data for RYBREVANT with chemotherapy in metastatic colorectal cancer patients, extending the asset 's potential beyond lung cancer. In multiple myeloma, we advanced our leadership position with FDA approval and filing of two DARZALEX FASPRO quad - based regimens for newly diagnosed patients. With CARVYKTI, we announced three - year follow - up data showing significantly extended overall survival and gained approval for commercial production at our Ghent facility, further expanding supply capacity. Finally, in oncology, we added to the growing evidence base for our TARIS platform with positive Phase 2b data in patients with high - risk non - muscle invasive bladder cancer and positive interim to Phase 2 data in patients with muscle invasive bladder cancer. In neuroscience, we submitted to the U.S. and European regulatory bodies for what would be the first global approval of nipocalimab for the treatment of people living with generalized myasthenia gravis. For the remainder of the year, we expect approval of TREMFYA subcu for Crohn 's disease and data readouts on JNJ-2113, our targeted oral peptide for psoriasis and ulcerative colitis, JNJ-4804, our co - antibody therapeutic for inflammatory bowel disease, aticaprant for adjunctive major depressive disorder and nipocalimab for rheumatoid arthritis. In MedTech, we completed enrollment of the Omny - IRE clinical trial to evaluate safety and effectiveness in mapping and treating symptomatic paroxysmal atrial fibrillation during standard ablation procedures. Also in Cardiovascular, we are preparing for the anticipated approval of VARIPULSE in the U.S. and the submission of Impella ECP for regulatory approval. In Orthopaedics, we launched several exciting new products in the U.S., including our VELYS SPINE robot and VOLT Plating System. The plentiful pipeline progress across our businesses will ensure continued success. Let 's now turn to cash and capital allocation. Free cash flow year - to - date was approximately $14 billion compared to $12 billion last year, which included eight months contribution from the Consumer Health business. We ended the third quarter with $20 billion of cash and marketable securities and $36 billion of debt for a net debt position of approximately $16 billion. Our capital allocation priorities remain unchanged. Our strong balance sheet enables us to strategically invest to grow our business while simultaneously returning capital to our shareholders. Innovation remains core to our strategy. During the quarter, we invested nearly $5 billion in research and development. This is an increase over 2023 levels even after excluding acquired in - process R&D expense. Thus far in 2024, Johnson & Johnson has deployed approximately $18 billion for strategic acquisitions and licensing agreements, which includes the recent acquisition of V - Wave, another innovative treatment in heart failure, which closed last week. Turning to our full - year 2024 guidance. Excluding the impact from acquisitions and divestitures, we are increasing our adjusted operational sales guidance. We now expect growth in the range of 5.7% to 6.2% with a midpoint of 6%. We are also increasing operational sales growth by $200 million to a range of 6.3% to 6.8% with a midpoint of $89.6 billion or 6.6%. As you know, we do n't speculate on future currency movements. For today 's call, we are utilizing a euro spot rate relative to the U.S. dollar of $1.10, slightly above last quarter 's guidance. This results in an estimated incremental positive foreign currency impact of $200 million, reducing our previous full - year negative impact to $1 billion. As such, we expect reported sales growth between 5.1% to 5.6% with a midpoint of $88.6 billion or 5.4%. Regarding the rest of the P&L, with the addition of the V - Wave transaction, we now anticipate our 2024 adjusted pre - tax operating margin to decline by approximately 200 basis points. Excluding the impact of asset acquisition accounting and related R&D investment, we would be on track to improve operating margins by 50 basis points, which is consistent with what we guided to at the beginning of the year. As we strive to advance and accelerate our pipeline, you can anticipate elevated levels of investment in the fourth quarter. Net interest income is now projected to be between $450 million and $550 million, $150 million greater than our previous guidance. Other income is anticipated to be in the range of $1.9 billion to $2.1 billion, an increase versus previous guidance, driven by the one - time monetization of royalty rights, which Jessica referenced, that will be utilized for that higher Q4 investment I referenced a moment ago. Our effective tax rate, consistent with previous guidance, is expected to be between 17.5% and 18.5% for the full year. Similar to last quarter, we have provided an EPS bridge to outline the impact from acquisition activity throughout the year. Before the impact of the V - Wave acquisition, our outlook for adjusted operational EPS performance is once again increasing. As the schedule reflects, we are expecting an incremental $0.10 per share increase on our operational performance for a total increase of $0.18 per share for the year. On this basis, when excluding acquisition activity throughout the year, EPS growth is 9.2%. To account for the completion of the V - Wave transaction, as previously disclosed, our adjusted operational EPS guidance now includes dilution of $0.24 per share in the fourth quarter and $0.06 per share in 2025. Combined, this yields an updated 2024 adjusted operational EPS guidance of $9.91 at the midpoint of the range, basically flat year - on - year despite absorbing approximately $0.92 of acquisition activity. While not predicting the impact of currency movements utilizing the recent exchange rates just referenced, our reported adjusted earnings per share for the year now estimates a full year positive impact of $0.02 per share. As such, we expect reported adjusted earnings per share of $9.93 at the midpoint. We are still finalizing our plans for next year, but let me provide you some preliminary qualitative commentary to inform your modeling for 2025. For Innovative Medicine, we remain very confident in our ability to deliver growth despite a significant LOE resulting in sales above the $57 billion commitment we stated in 2021. This will be driven by our end market brands and continued progress from our recently launched products, including TREMFYA in IBD and RYBREVANT in non - small cell lung cancer. Regarding the STELARA LOE, we are planning for biosimilar entries in the U.S. in January, assuming that HUMIRA 's erosion curve is a relatively good proxy for your models. We continue to expect a negative impact associated with the Part D redesign. In our pipeline, we anticipate data readouts across all our priority platforms: anticipated approvals of TREMFYA subcu in Crohn 's disease, RYBREVANT subcu for lung cancer and nipocalimab in generalized myasthenia gravis, as well as potential filings for TARIS in bladder cancer and aticaprant in major depressive disorder. As a reminder, TREMFYA, RYBREVANT and TARIS continue to be the three largest underappreciated assets in terms of our revenue projections versus what analysts are estimating for the back half of this decade. For MedTech, we continue to expect to deliver on our long - term objective identified at last year 's Enterprise Business Review of growing operational sales in the upper end of the 2022 through 2027 weighted average market growth rate of 5% to 7%. We also expect continued adoption of newer products across all MedTech businesses, such as VARIPULSE in electrophysiology, VELYS enabling technology across Orthopaedics, Odyssey and PureSee in Surgical Vision and contributions from our Abiomed and Shockwave integration. Specific to volume - based pricing in China, we expect continued impacts from the rollout of the 2024 tenders in Orthopaedics sports and intraocular lenses and anticipate VBP to continue expanding across provinces and products. Moving to the rest of the P&L. When thinking about operating margin, there are pluses and minuses. Tailwinds include an anticipated reduction of acquired IPR&D expense year - over - year, continued focus on MedTech margin improvement and continued OpEx optimization benefits post the separation. Working against us is unfavorable product mix driven by STELARA biosimilar entrants and Part D redesign. With a brief look at your models last week, the consensus margin does not appear unreasonable, and we 'll provide further clarity in January once we complete our 2025 plan. We do not expect to maintain the heightened levels of interest income due to a reduction in interest rates and impact from debt experienced in 2024 related to acquisition activity. Regarding other income and expense, we expect lower net other income due to the non - recurring nature of the monetization of royalty rights experienced in Q3, a lower benefit related to employee benefit programs based on discount rate assumptions, as well as income lost on the Kenvue dividend. Lastly, based on what we know today, under current tax law, we anticipate our 2025 tax rate to be slightly lower than our anticipated 2024 tax rate. To wrap up prior to Q&A, we are pleased with our underlying 2024 performance that simultaneously fortified a strong foundation for continued success heading into 2025. With that, I 'll now turn it over to Kevin to open the call for your questions.", "ground_truth_output": { "entities": [ { "id": 161, "label": "Traditional", "start_offset": 481, "end_offset": 499, "text": "operational growth", "global_span": [ 15532, 15550 ] }, { "id": 162, "label": "Value", "start_offset": 503, "end_offset": 507, "text": "6.4%", "global_span": [ 15554, 15558 ] }, { "id": 163, "label": "Traditional", "start_offset": 962, "end_offset": 996, "text": "MedTech adjusted operational sales", "global_span": [ 16013, 16047 ] }, { "id": 164, "label": "Value", "start_offset": 1043, "end_offset": 1045, "text": "5%", "global_span": [ 16094, 16096 ] }, { "id": 165, "label": "Value", "start_offset": 1057, "end_offset": 1059, "text": "6%", "global_span": [ 16108, 16110 ] }, { "id": 166, "label": "Traditional", "start_offset": 1455, "end_offset": 1458, "text": "pre", "global_span": [ 16506, 16509 ] }, { "id": 167, "label": "Traditional", "start_offset": 1461, "end_offset": 1485, "text": "packaged bankruptcy plan", "global_span": [ 16512, 16536 ] }, { "id": 168, "label": "Traditional", "start_offset": 1508, "end_offset": 1515, "text": "support", "global_span": [ 16559, 16566 ] }, { "id": 169, "label": "Value", "start_offset": 1554, "end_offset": 1557, "text": "83%", "global_span": [ 16605, 16608 ] }, { "id": 170, "label": "Non_Traditional", "start_offset": 2140, "end_offset": 2168, "text": "FDA priority review underway", "global_span": [ 17191, 17219 ] }, { "id": 171, "label": "Non_Traditional", "start_offset": 2175, "end_offset": 2199, "text": "subcutaneous formulation", "global_span": [ 17226, 17250 ] }, { "id": 172, "label": "Traditional", "start_offset": 2203, "end_offset": 2212, "text": "RYBREVANT", "global_span": [ 17254, 17263 ] }, { "id": 173, "label": "Non_Traditional", "start_offset": 3226, "end_offset": 3247, "text": "first global approval", "global_span": [ 18277, 18298 ] }, { "id": 174, "label": "Non_Traditional", "start_offset": 3251, "end_offset": 3262, "text": "nipocalimab", "global_span": [ 18302, 18313 ] }, { "id": 175, "label": "Non_Traditional", "start_offset": 3271, "end_offset": 3280, "text": "treatment", "global_span": [ 18322, 18331 ] }, { "id": 176, "label": "Non_Traditional", "start_offset": 3303, "end_offset": 3332, "text": "generalized myasthenia gravis", "global_span": [ 18354, 18383 ] }, { "id": 177, "label": "Non_Traditional", "start_offset": 3342, "end_offset": 3351, "text": "remainder", "global_span": [ 18393, 18402 ] }, { "id": 178, "label": "Non_Traditional", "start_offset": 3359, "end_offset": 3363, "text": "year", "global_span": [ 18410, 18414 ] }, { "id": 179, "label": "Non_Traditional", "start_offset": 3368, "end_offset": 3383, "text": "expect approval", "global_span": [ 18419, 18434 ] }, { "id": 180, "label": "Non_Traditional", "start_offset": 3387, "end_offset": 3394, "text": "TREMFYA", "global_span": [ 18438, 18445 ] }, { "id": 181, "label": "Non_Traditional", "start_offset": 4050, "end_offset": 4062, "text": "Orthopaedics", "global_span": [ 19101, 19113 ] }, { "id": 182, "label": "Non_Traditional", "start_offset": 4067, "end_offset": 4075, "text": "launched", "global_span": [ 19118, 19126 ] }, { "id": 183, "label": "Non_Traditional", "start_offset": 4133, "end_offset": 4150, "text": "VELYS SPINE robot", "global_span": [ 19184, 19201 ] }, { "id": 184, "label": "Non_Traditional", "start_offset": 4155, "end_offset": 4174, "text": "VOLT Plating System", "global_span": [ 19206, 19225 ] }, { "id": 185, "label": "Traditional", "start_offset": 4309, "end_offset": 4328, "text": "Free cash flow year", "global_span": [ 19360, 19379 ] }, { "id": 186, "label": "Traditional", "start_offset": 4331, "end_offset": 4333, "text": "to", "global_span": [ 19382, 19384 ] }, { "id": 187, "label": "Traditional", "start_offset": 4336, "end_offset": 4340, "text": "date", "global_span": [ 19387, 19391 ] }, { "id": 188, "label": "Traditional", "start_offset": 4345, "end_offset": 4358, "text": "approximately", "global_span": [ 19396, 19409 ] }, { "id": 189, "label": "Value", "start_offset": 4360, "end_offset": 4370, "text": "14 billion", "global_span": [ 19411, 19421 ] }, { "id": 190, "label": "Value", "start_offset": 4384, "end_offset": 4394, "text": "12 billion", "global_span": [ 19435, 19445 ] }, { "id": 191, "label": "Value", "start_offset": 4514, "end_offset": 4525, "text": "$20 billion", "global_span": [ 19565, 19576 ] }, { "id": 192, "label": "Traditional", "start_offset": 4529, "end_offset": 4533, "text": "cash", "global_span": [ 19580, 19584 ] }, { "id": 193, "label": "Traditional", "start_offset": 4538, "end_offset": 4559, "text": "marketable securities", "global_span": [ 19589, 19610 ] }, { "id": 194, "label": "Value", "start_offset": 4564, "end_offset": 4575, "text": "$36 billion", "global_span": [ 19615, 19626 ] }, { "id": 195, "label": "Traditional", "start_offset": 4590, "end_offset": 4607, "text": "net debt position", "global_span": [ 19641, 19658 ] }, { "id": 196, "label": "Value", "start_offset": 4625, "end_offset": 4636, "text": "$16 billion", "global_span": [ 19676, 19687 ] }, { "id": 197, "label": "Traditional", "start_offset": 4895, "end_offset": 4903, "text": "invested", "global_span": [ 19946, 19954 ] }, { "id": 198, "label": "Value", "start_offset": 4912, "end_offset": 4921, "text": "5 billion", "global_span": [ 19963, 19972 ] }, { "id": 199, "label": "Traditional", "start_offset": 4925, "end_offset": 4933, "text": "research", "global_span": [ 19976, 19984 ] }, { "id": 200, "label": "Traditional", "start_offset": 4938, "end_offset": 4949, "text": "development", "global_span": [ 19989, 20000 ] }, { "id": 201, "label": "Value", "start_offset": 5107, "end_offset": 5118, "text": "$18 billion", "global_span": [ 20158, 20169 ] }, { "id": 202, "label": "Traditional", "start_offset": 5123, "end_offset": 5145, "text": "strategic acquisitions", "global_span": [ 20174, 20196 ] }, { "id": 203, "label": "Traditional", "start_offset": 5150, "end_offset": 5170, "text": "licensing agreements", "global_span": [ 20201, 20221 ] }, { "id": 204, "label": "Traditional", "start_offset": 5336, "end_offset": 5345, "text": "Excluding", "global_span": [ 20387, 20396 ] }, { "id": 205, "label": "Traditional", "start_offset": 5362, "end_offset": 5374, "text": "acquisitions", "global_span": [ 20413, 20425 ] }, { "id": 206, "label": "Traditional", "start_offset": 5379, "end_offset": 5391, "text": "divestitures", "global_span": [ 20430, 20442 ] }, { "id": 207, "label": "Traditional", "start_offset": 5415, "end_offset": 5450, "text": "adjusted operational sales guidance", "global_span": [ 20466, 20501 ] }, { "id": 208, "label": "Traditional", "start_offset": 5466, "end_offset": 5472, "text": "growth", "global_span": [ 20517, 20523 ] }, { "id": 209, "label": "Value", "start_offset": 5497, "end_offset": 5501, "text": "6.2%", "global_span": [ 20548, 20552 ] }, { "id": 210, "label": "Value", "start_offset": 5521, "end_offset": 5523, "text": "6%", "global_span": [ 20572, 20574 ] }, { "id": 211, "label": "Traditional", "start_offset": 5548, "end_offset": 5572, "text": "operational sales growth", "global_span": [ 20599, 20623 ] }, { "id": 212, "label": "Value", "start_offset": 5576, "end_offset": 5588, "text": "$200 million", "global_span": [ 20627, 20639 ] }, { "id": 213, "label": "Value", "start_offset": 5603, "end_offset": 5607, "text": "6.3%", "global_span": [ 20654, 20658 ] }, { "id": 214, "label": "Value", "start_offset": 5611, "end_offset": 5615, "text": "6.8%", "global_span": [ 20662, 20666 ] }, { "id": 215, "label": "Value", "start_offset": 5635, "end_offset": 5648, "text": "$89.6 billion", "global_span": [ 20686, 20699 ] }, { "id": 216, "label": "Value", "start_offset": 5652, "end_offset": 5656, "text": "6.6%", "global_span": [ 20703, 20707 ] }, { "id": 217, "label": "Traditional", "start_offset": 6028, "end_offset": 6049, "text": "reported sales growth", "global_span": [ 21079, 21100 ] }, { "id": 218, "label": "Value", "start_offset": 6058, "end_offset": 6062, "text": "5.1%", "global_span": [ 21109, 21113 ] }, { "id": 219, "label": "Value", "start_offset": 6066, "end_offset": 6070, "text": "5.6%", "global_span": [ 21117, 21121 ] }, { "id": 220, "label": "Value", "start_offset": 6090, "end_offset": 6103, "text": "$88.6 billion", "global_span": [ 21141, 21154 ] }, { "id": 221, "label": "Value", "start_offset": 6107, "end_offset": 6111, "text": "5.4%", "global_span": [ 21158, 21162 ] }, { "id": 222, "label": "Traditional", "start_offset": 6218, "end_offset": 6230, "text": "adjusted pre", "global_span": [ 21269, 21281 ] }, { "id": 223, "label": "Traditional", "start_offset": 6233, "end_offset": 6253, "text": "tax operating margin", "global_span": [ 21284, 21304 ] }, { "id": 224, "label": "Value", "start_offset": 6282, "end_offset": 6298, "text": "200 basis points", "global_span": [ 21333, 21349 ] }, { "id": 225, "label": "Value", "start_offset": 6434, "end_offset": 6449, "text": "50 basis points", "global_span": [ 21485, 21500 ] }, { "id": 226, "label": "Traditional", "start_offset": 6653, "end_offset": 6668, "text": "interest income", "global_span": [ 21704, 21719 ] }, { "id": 227, "label": "Value", "start_offset": 6700, "end_offset": 6712, "text": "$450 million", "global_span": [ 21751, 21763 ] }, { "id": 228, "label": "Value", "start_offset": 6717, "end_offset": 6729, "text": "$550 million", "global_span": [ 21768, 21780 ] }, { "id": 229, "label": "Value", "start_offset": 6731, "end_offset": 6743, "text": "$150 million", "global_span": [ 21782, 21794 ] }, { "id": 230, "label": "Traditional", "start_offset": 6780, "end_offset": 6792, "text": "Other income", "global_span": [ 21831, 21843 ] }, { "id": 231, "label": "Value", "start_offset": 6830, "end_offset": 6842, "text": "$1.9 billion", "global_span": [ 21881, 21893 ] }, { "id": 232, "label": "Value", "start_offset": 6846, "end_offset": 6858, "text": "$2.1 billion", "global_span": [ 21897, 21909 ] }, { "id": 233, "label": "Traditional", "start_offset": 7064, "end_offset": 7082, "text": "effective tax rate", "global_span": [ 22115, 22133 ] }, { "id": 234, "label": "Value", "start_offset": 7145, "end_offset": 7150, "text": "17.5%", "global_span": [ 22196, 22201 ] }, { "id": 235, "label": "Value", "start_offset": 7155, "end_offset": 7160, "text": "18.5%", "global_span": [ 22206, 22211 ] }, { "id": 236, "label": "Traditional", "start_offset": 7225, "end_offset": 7228, "text": "EPS", "global_span": [ 22276, 22279 ] }, { "id": 237, "label": "Traditional", "start_offset": 7368, "end_offset": 7404, "text": "adjusted operational EPS performance", "global_span": [ 22419, 22455 ] }, { "id": 238, "label": "Value", "start_offset": 7489, "end_offset": 7504, "text": "$0.10 per share", "global_span": [ 22540, 22555 ] }, { "id": 239, "label": "Value", "start_offset": 7569, "end_offset": 7584, "text": "$0.18 per share", "global_span": [ 22620, 22635 ] }, { "id": 240, "label": "Traditional", "start_offset": 7671, "end_offset": 7674, "text": "EPS", "global_span": [ 22722, 22725 ] }, { "id": 241, "label": "Value", "start_offset": 7685, "end_offset": 7689, "text": "9.2%", "global_span": [ 22736, 22740 ] }, { "id": 242, "label": "Traditional", "start_offset": 7800, "end_offset": 7803, "text": "EPS", "global_span": [ 22851, 22854 ] }, { "id": 243, "label": "Value", "start_offset": 7838, "end_offset": 7843, "text": "$0.24", "global_span": [ 22889, 22894 ] }, { "id": 244, "label": "Value", "start_offset": 7880, "end_offset": 7895, "text": "$0.06 per share", "global_span": [ 22931, 22946 ] }, { "id": 245, "label": "Traditional", "start_offset": 7943, "end_offset": 7976, "text": "adjusted operational EPS guidance", "global_span": [ 22994, 23027 ] }, { "id": 246, "label": "Value", "start_offset": 7980, "end_offset": 7985, "text": "$9.91", "global_span": [ 23031, 23036 ] }, { "id": 247, "label": "Value", "start_offset": 8080, "end_offset": 8085, "text": "$0.92", "global_span": [ 23131, 23136 ] }, { "id": 248, "label": "Traditional", "start_offset": 8362, "end_offset": 8389, "text": "adjusted earnings per share", "global_span": [ 23413, 23440 ] }, { "id": 249, "label": "Value", "start_offset": 8393, "end_offset": 8398, "text": "$9.93", "global_span": [ 23444, 23449 ] }, { "id": 250, "label": "Value", "start_offset": 8700, "end_offset": 8711, "text": "$57 billion", "global_span": [ 23751, 23762 ] }, { "id": 251, "label": "Non_Traditional", "start_offset": 8712, "end_offset": 8722, "text": "commitment", "global_span": [ 23763, 23773 ] }, { "id": 252, "label": "Non_Traditional", "start_offset": 9839, "end_offset": 9856, "text": "operational sales", "global_span": [ 24890, 24907 ] }, { "id": 253, "label": "Non_Traditional", "start_offset": 9881, "end_offset": 9885, "text": "2022", "global_span": [ 24932, 24936 ] }, { "id": 254, "label": "Non_Traditional", "start_offset": 9894, "end_offset": 9929, "text": "2027 weighted average market growth", "global_span": [ 24945, 24980 ] }, { "id": 255, "label": "Value", "start_offset": 9938, "end_offset": 9940, "text": "5%", "global_span": [ 24989, 24991 ] }, { "id": 256, "label": "Value", "start_offset": 9944, "end_offset": 9946, "text": "7%", "global_span": [ 24995, 24997 ] }, { "id": 332, "label": "Traditional", "text": "Our MedTech business, with the addition of Shockwave", "start_offset": 417, "end_offset": 469, "global_span": [ 15468, 15520 ] }, { "id": 333, "label": "Traditional", "text": "full year 2024", "start_offset": 1012, "end_offset": 1026, "global_span": [ 16063, 16077 ] }, { "id": 334, "label": "Traditional", "text": "we referenced last quarter.", "start_offset": 1060, "end_offset": 1087, "global_span": [ 16111, 16138 ] }, { "id": 335, "label": "Traditional", "text": " last year,", "start_offset": 4394, "end_offset": 4405, "global_span": [ 19445, 19456 ] }, { "id": 336, "label": "Traditional", "text": " 5.7%", "start_offset": 5488, "end_offset": 5493, "global_span": [ 20539, 20544 ] }, { "id": 337, "label": "Traditional", "text": "Net interest income", "start_offset": 6649, "end_offset": 6668, "global_span": [ 21700, 21719 ] }, { "id": 338, "label": "Traditional", "text": "greater than our previous guidance", "start_offset": 6744, "end_offset": 6778, "global_span": [ 21795, 21829 ] }, { "id": 339, "label": "Traditional", "text": "anticipated ", "start_offset": 6796, "end_offset": 6808, "global_span": [ 21847, 21859 ] }, { "id": 340, "label": "Traditional", "text": "expected ", "start_offset": 7122, "end_offset": 7131, "global_span": [ 22173, 22182 ] }, { "id": 341, "label": "Traditional", "text": " total increase", "start_offset": 7550, "end_offset": 7565, "global_span": [ 22601, 22616 ] }, { "id": 342, "label": "Traditional", "text": "growth ", "start_offset": 7675, "end_offset": 7682, "global_span": [ 22726, 22733 ] }, { "id": 343, "label": "Traditional", "text": "in 2025", "start_offset": 7896, "end_offset": 7903, "global_span": [ 22947, 22954 ] } ], "relations": [ { "id": 74, "entity_ids": [ 161, 162 ], "description": "Value_of" }, { "id": 75, "entity_ids": [ 161, 162, 332 ], "description": "Value_of" }, { "id": 76, "entity_ids": [ 163, 164, 333 ], "description": "Value_of" }, { "id": 77, "entity_ids": [ 163, 165, 334 ], "description": "Value_of" }, { "id": 78, "entity_ids": [ 173, 174, 175, 176 ], "description": "Value_of" }, { "id": 79, "entity_ids": [ 177, 178, 179, 180 ], "description": "Value_of" }, { "id": 80, "entity_ids": [ 170, 171, 172 ], "description": "Value_of" }, { "id": 81, "entity_ids": [ 181, 182, 183 ], "description": "Value_of" }, { "id": 82, "entity_ids": [ 181, 182, 184 ], "description": "Value_of" }, { "id": 83, "entity_ids": [ 185, 186, 187, 188, 189 ], "description": "Value_of" }, { "id": 84, "entity_ids": [ 185, 190, 335 ], "description": "Value_of" }, { "id": 85, "entity_ids": [ 191, 192, 193 ], "description": "Value_of" }, { "id": 86, "entity_ids": [ 194, 195, 196 ], "description": "Value_of" }, { "id": 87, "entity_ids": [ 197, 198, 199, 200 ], "description": "Value_of" }, { "id": 88, "entity_ids": [ 201, 202, 203 ], "description": "Value_of" }, { "id": 89, "entity_ids": [ 204, 205, 206, 207 ], "description": "Value_of" }, { "id": 90, "entity_ids": [ 207, 208, 209, 336 ], "description": "Value_of" }, { "id": 91, "entity_ids": [ 207, 208, 210 ], "description": "Value_of" }, { "id": 92, "entity_ids": [ 211, 212 ], "description": "Value_of" }, { "id": 93, "entity_ids": [ 211, 213 ], "description": "Value_of" }, { "id": 94, "entity_ids": [ 211, 214 ], "description": "Value_of" }, { "id": 95, "entity_ids": [ 211, 215 ], "description": "Value_of" }, { "id": 96, "entity_ids": [ 211, 216 ], "description": "Value_of" }, { "id": 97, "entity_ids": [ 217, 218 ], "description": "Value_of" }, { "id": 98, "entity_ids": [ 217, 219 ], "description": "Value_of" }, { "id": 99, "entity_ids": [ 217, 220 ], "description": "Value_of" }, { "id": 100, "entity_ids": [ 217, 221 ], "description": "Value_of" }, { "id": 101, "entity_ids": [ 222, 223, 224 ], "description": "Value_of" }, { "id": 102, "entity_ids": [ 227, 337, 338 ], "description": "Value_of" }, { "id": 103, "entity_ids": [ 228, 337, 338 ], "description": "Value_of" }, { "id": 104, "entity_ids": [ 230, 231 ], "description": "Value_of" }, { "id": 105, "entity_ids": [ 230, 232 ], "description": "Value_of" }, { "id": 106, "entity_ids": [ 230, 231, 339 ], "description": "Value_of" }, { "id": 107, "entity_ids": [ 230, 232, 339 ], "description": "Value_of" }, { "id": 108, "entity_ids": [ 233, 234, 235, 340 ], "description": "Value_of" }, { "id": 109, "entity_ids": [ 237, 238 ], "description": "Value_of" }, { "id": 110, "entity_ids": [ 237, 239, 341 ], "description": "Value_of" }, { "id": 111, "entity_ids": [ 240, 241, 342 ], "description": "Value_of" }, { "id": 112, "entity_ids": [ 242, 243 ], "description": "Value_of" }, { "id": 113, "entity_ids": [ 242, 244, 343 ], "description": "Value_of" }, { "id": 114, "entity_ids": [ 245, 246 ], "description": "Value_of" }, { "id": 115, "entity_ids": [ 248, 249 ], "description": "Value_of" }, { "id": 116, "entity_ids": [ 250, 251 ], "description": "Value_of" }, { "id": 117, "entity_ids": [ 252, 253, 254, 255, 256 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Operator: Thank you. We 'll now be conducting a question - and - answer session. [Operator Instructions ] Our first question is coming from Chris Schott from JPMorgan. Your line is now live.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "Chris Schott: Great. Thanks so much for the question. Maybe just one on talc here. I know this is still limited comments, but it seems though the company has obviously made some advancements here into getting this behind the organization. Maybe just can you help us a little bit in terms of, from your perspective, next key steps to watch from here? And what is J&J 's overall level of confidence that you have a path to resolve this in the relative near term for the story? Thanks so much.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Joaquin Duato: Yeah, thank you, Chris. And as you have heard me before, our intention with respect to the talc litigation is to bring a responsible, final and comprehensive resolution to these claims. And we are making meaningful progress to do just that. We have filed our pre - packaged reorganization plan with the support of 83% of the claimants. And also, we have had a decision of the court to keep the filing in Houston. So, as I said, we are making progress in this resolution that I refer. As far as next steps, Erik?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Erik Haas: Hi. Thanks, Chris. This is Erik Haas, Head of Worldwide Litigation. Judge Lopez last week on Thursday, after ruling that the case properly and appropriately should remain in Texas, ordered the parties to meet and confer and agree to a schedule for the expeditious resolution of the case. And by that, it means setting forth a schedule to get through to the confirmation procedure, addressing any ancillary motions, whether the motions to dismiss or issues relating to the votes. And the parties are in that process. We contemplate putting forth a schedule that resolves those issues through the end of the year for a confirmation hearing sometime at the beginning of next year. So that 's the schedule we 're on.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Next question is coming from Larry Biegelsen from Wells Fargo. Your line is now live.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Larry Biegelsen: Good morning. Thanks for taking the question. Tim, on MedTech, maybe help us understand the impact of the one - time items in Q3, such as the ortho SKU rationalization. How you 're thinking about the impact from the hurricanes in Q4? And what gives you confidence you can deliver the high end of that 5% to 7% next year? Thanks for taking the questions.", "ground_truth_output": { "entities": [ { "id": 257, "label": "Value", "start_offset": 319, "end_offset": 321, "text": "5%", "global_span": [ 29307, 29309 ] }, { "id": 258, "label": "Value", "start_offset": 325, "end_offset": 327, "text": "7%", "global_span": [ 29313, 29315 ] }, { "id": 344, "label": "Traditional", "text": "MedTech", "start_offset": 72, "end_offset": 79, "global_span": [ 29060, 29067 ] } ], "relations": [ { "id": 118, "entity_ids": [ 257, 258, 344 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Tim Schmid: Larry, thank you for the question. And we 're proud of the 6.4% operational growth for the quarter -- sorry, 5.7% for full year. And I think the results really talked about the success of our deliberate move into higher - growth, higher - margin categories, especially in the cardiovascular space. You 'll recall, and you 'll see that from our results, almost $300 million has been added from the Shockwave acquisition, which continues to perform to expectations as does Abiomed. And we ' ve also added to the portfolio acquisition of Laminar in the fourth quarter of last year, and then more recently, the announced closure of the acquisition of V - Wave, which, once again, takes us into even more exciting high - growth, high - margin opportunities within Cardiovascular. Specifically to Orthopaedics, we believe this is going to be another solid year for Orthopaedics, 3.2% growth for the year. We did have a slightly softer third quarter, which was a result, to your point, of the restructure within Orthopaedics. And as we look to the full year, we expect a return to a significantly better performance, especially in Orthopaedics, which typically has a stronger fourth quarter. And we are seeing tremendous performance specifically within the hips and knees categories growing 6% and 7%. And I think that 's really been enabled by the success of our enabling technologies in VELYS in knees, which also, by the way, we ' ve added indication of the [Uni Knee ] (ph), as well as our KINCISE and Hip Navigation systems within hips. I 'd also add to the Orthopaedics performance, we are significantly addressing portfolio gaps within our trauma portfolio with the launch of TriLeap, [indiscernible ] and VOLT in the back half of the year. And I think you know our spine portfolio has been challenged, and we 're addressing that with the launch of TELIGEN, our new TriALTIS thoracal lumbar system and the new spine robot, which we just received approval for. As it relates the hurricanes, we did see the impact, certainly of Hurricane Helene, in the final weeks of the third quarter and continue to see the impact of Milton over the last coming days especially in the areas most impacted by those storms. I do think the watch out that we all need to watch carefully is certainly the impact of the recently announced IV saline shortages, which if they do persist, could potentially impact surgical procedures across our portfolio. Thank you, Larry.", "ground_truth_output": { "entities": [ { "id": 259, "label": "Value", "start_offset": 72, "end_offset": 76, "text": "6.4%", "global_span": [ 29431, 29435 ] }, { "id": 260, "label": "Traditional", "start_offset": 77, "end_offset": 95, "text": "operational growth", "global_span": [ 29436, 29454 ] }, { "id": 261, "label": "Value", "start_offset": 122, "end_offset": 126, "text": "5.7%", "global_span": [ 29481, 29485 ] }, { "id": 262, "label": "Traditional", "start_offset": 131, "end_offset": 140, "text": "full year", "global_span": [ 29490, 29499 ] }, { "id": 263, "label": "Traditional", "start_offset": 872, "end_offset": 884, "text": "Orthopaedics", "global_span": [ 30231, 30243 ] }, { "id": 264, "label": "Value", "start_offset": 886, "end_offset": 897, "text": "3.2% growth", "global_span": [ 30245, 30256 ] }, { "id": 265, "label": "Traditional", "start_offset": 906, "end_offset": 910, "text": "year", "global_span": [ 30265, 30269 ] }, { "id": 266, "label": "Traditional", "start_offset": 1263, "end_offset": 1296, "text": "hips and knees categories growing", "global_span": [ 30622, 30655 ] }, { "id": 267, "label": "Value", "start_offset": 1297, "end_offset": 1299, "text": "6%", "global_span": [ 30656, 30658 ] }, { "id": 268, "label": "Value", "start_offset": 1304, "end_offset": 1306, "text": "7%", "global_span": [ 30663, 30665 ] } ], "relations": [ { "id": 119, "entity_ids": [ 260, 261, 262 ], "description": "Value_of" }, { "id": 120, "entity_ids": [ 259, 260, 262 ], "description": "Value_of" }, { "id": 121, "entity_ids": [ 263, 264, 265 ], "description": "Value_of" }, { "id": 122, "entity_ids": [ 266, 267, 268 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Next question is coming from Louise Chen from Cantor Fitzgerald. Your line is now live.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Louise Chen: Hi. Thank you for taking my question here. I wanted to ask you how you see TREMFYA, JNJ-2113 and some of your other pipeline products coming together to replace sales lost to STELARA and then take share from entrenched competitors? Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Jennifer Taubert: Hi. Louise. It 's Jennifer. And good morning, everyone. And I wanted to start off by having a chance to really recognize and thank all my Innovative Medicine colleagues around the world for fabulous quarter in the third quarter. We really continue to deliver against our strategy with 11 key brands having double - digit growth and achieving a few really notable milestones, notably the TREMFYA approval and launch in ulcerative colitis, also RYBREVANT plus LAZCLUZE in first line non - small cell lung cancer, and we also completed the acquisition of NM26, which is a Phase 2 - ready asset for atopic dermatitis. So, as we take a look at the immunology portfolio, we 're really excited about TREMFYA, what we see as the prospects ahead. I just mentioned that we got approval during the quarter for that product in ulcerative colitis. We believe we truly have a winning proposition for that asset in IBD. And it 's off to a really nice start with a good -- a really strong reception amongst the medical community. And we see that product having a lot of strength because it 's the only dual act of IL-23. So, it blocks both IL-23 and the CD64 receptor cells. It really sets what we believe is a new bar in terms of efficacy with the highest rate of endoscopic normalization. And we ' ve got rigorous head - to - head data versus STELARA showing superiority in Crohn 's disease. And we think that we ' ve got unrivaled flexibility and what will ultimately be a subcu both induction and maintenance dose for TREMFYA. So, TREMFYA was $4 billion in sales for the quarter. And that was really on psoriasis and psoriatic arthritis alone. When we take a look going forward and what we had seen with STELARA in terms of the strength in IBD and the potential, we think that TREMFYA definitely is an asset that is STELARA size or bigger and better. So, a lot of exciting opportunity for us ahead. For 2113, we 're really excited about our oral asset that we 're developing. And I 'll let John Reed, my colleague, John Reed, actually talk about why we 're so excited about it and some of the data -- upcoming data there, but we do think that being able to have that advanced efficacy and known safety profile in a simple oral tablet is not only going to be great for the existing biologics ' appropriate patients, but we think it gives us a great market expansion opportunity moving into earlier lines of therapy as well. John?", "ground_truth_output": { "entities": [ { "id": 269, "label": "Value", "start_offset": 542, "end_offset": 551, "text": "completed", "global_span": [ 32730, 32739 ] }, { "id": 270, "label": "Traditional", "start_offset": 556, "end_offset": 575, "text": "acquisition of NM26", "global_span": [ 32744, 32763 ] }, { "id": 271, "label": "Traditional", "start_offset": 1538, "end_offset": 1545, "text": "TREMFYA", "global_span": [ 33726, 33733 ] }, { "id": 272, "label": "Value", "start_offset": 1550, "end_offset": 1560, "text": "$4 billion", "global_span": [ 33738, 33748 ] }, { "id": 273, "label": "Traditional", "start_offset": 1564, "end_offset": 1569, "text": "sales", "global_span": [ 33752, 33757 ] }, { "id": 274, "label": "Traditional", "start_offset": 1578, "end_offset": 1585, "text": "quarter", "global_span": [ 33766, 33773 ] } ], "relations": [ { "id": 123, "entity_ids": [ 269, 270 ], "description": "Value_of" }, { "id": 124, "entity_ids": [ 271, 272, 273, 274 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "John Reed: Yeah, thanks. The 2113 is really moving along nicely. As you know, this is our targeted oral peptide, a very exquisite, elegantly designed molecule that binds to and blocks the IL-23 receptor, and it is orally available with once - daily dosing. The psoriasis indication is fully enrolled now, four Phase 3 studies, which are quite broad and include head to heads against TYK2 inhibitors as well as both adult and adolescent patients as well as a study in patients that have disease affecting hard - to - treat areas, scalp and other parts of the anatomy that can be very difficult to clear typically. So, we 're really looking quite comprehensively there, and the data will be rolling out in the next few months. So, we look forward to sharing those at the appropriate time. In inflammatory bowel disease, we 're in a signal - seeking Phase 2 study in ulcerative colitis where we 're exploring different doses before moving into more advanced studies, given that the IL-23 pathway is well validated inflammatory bowel disease. Thanks to STELARA and TREMFYA, we 're quite confident that those studies will come through for us, but we 'll wait for those data later this year to see how that oral medication is faring there. The other thing I 'd maybe mention just in case it 's not on your radar is we also have a co - antibody approach, we call it 4804, where gus and gol, TREMFYA and our TNF inhibitor are combined for patients tend to be on the more refractory side. And we 're in the middle of inflammatory bowel disease studies there that will read out next year. So, really excited about that antibody combination as well. So altogether, the immunology portfolio is really quite robust and particularly in inflammatory bowel disease in the areas of dermatology where we ' ve had traditional strengths.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Jennifer Taubert: We really do think that we ' ve got a winning portfolio for inflammatory bowel diseases. And maybe just one addition because I know we ' ve had questions on this in the past on 2113, we 're going to be developing that really across the spectrum, so both ulcerative colitis as well as Crohn 's disease. So, we 're starting off in ulcerative colitis, but absolutely have plans to develop it in Crohn 's as well.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Next question today is coming from Terence Flynn from Morgan Stanley. Your line is now live.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Terence Flynn: Great. Thanks so much for taking the question. Maybe just on the multiple myeloma portfolio, obviously, very nice growth in CARVYKTI this quarter. I know you spoke to some of the drivers, but just was wondering if you can elaborate on what you 're seeing in the second - line setting at this point? And then, as you look at TECVAYLI through the rest of this year into next year, what 's it going to take to really see an acceleration in growth in this product? Or is this -- or do we have to wait until we get to earlier lines of treatment here to see growth again in that franchise? Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Jennifer Taubert: Hi, Terence, thanks so much for the question on multiple myeloma. And I wo n't go into a lot of detail on DARZALEX, but it 's worth noting that we had $3 billion in sales, more than 20% growth. And DARZALEX really continues to perform quite strongly for us as we continue to grow share, particularly in frontline, in both transplant eligible and ineligible patients. I really appreciate the question on CARVYKTI. So, $286 million in sales, 88% growth year - over - year and 53% quarter - over - quarter. And we 're really seeing that continued growth for a number of reasons. So first, we 're seeing very strong demand based on the CARTITUDE-4 approval for that second - line - and - beyond patients. In addition, overall survival data was just presented for CARVYKTI in this line, which was very, very significant and further adds to the importance of this medicine for patients with multiple myeloma. And the other aspect is we continue to progress really nicely with our continued capacity expansion, both in terms of number of slots per day in Raritan, we gained approval for our Ghent manufacturing site in Europe for commercial production, that is now underway and able to serve patients, and our CMO in the United States as well is producing on the clinical end. And so, all the way around from performance of the product from new data as well as continued capacity expansion, we continue to see very strong performance for CARVYKTI. And as we discussed before, I do n't know that we will see that as a complete exact linear growth curve quarter - to - quarter simply because the capacity expansion works in a bit more of a stair - step fashion, but as we have discussed, second quarter for us being definitely more robust than the first half, that 's playing through. And I think if you think about that going forward, that makes a lot of sense. And we 're over 4,200 patients now with CARVYKTI, and it is the most successful CAR - T launch for across -- throughout the industry across all CAR - Ts. Then last, you asked about TECVAYLI and talquetamab. So, if we take a look at -- start off basically with TEC. So, TEC sales were $135 million and 21% growth for the quarter, but it was flat sequentially. We 're seeing really nice uptake in the market in terms of new patients. There 's also a dynamic where physicians are treating with longer treatment durations. So, we do think that there 's a lot of continued growth and expansion for the product. It 's performing very well for patients and not only in its current lines of therapy, but we 're also taking a look and studying it in combinations, whether with DARZALEX, whether with TAL. And so, we do believe that there 's a lot of growth potential on there. For TALVEY, we 're not reporting out the sales yet. I think we 'll start on that probably next year. But both TAL and TEC, we continue to expand not only with the academic, but also out into the community setting. And so, we think there 's a lot of growth ahead.", "ground_truth_output": { "entities": [ { "id": 275, "label": "Traditional", "start_offset": 125, "end_offset": 133, "text": "DARZALEX", "global_span": [ 37721, 37729 ] }, { "id": 276, "label": "Value", "start_offset": 170, "end_offset": 180, "text": "$3 billion", "global_span": [ 37766, 37776 ] }, { "id": 277, "label": "Traditional", "start_offset": 184, "end_offset": 189, "text": "sales", "global_span": [ 37780, 37785 ] }, { "id": 278, "label": "Value", "start_offset": 201, "end_offset": 211, "text": "20% growth", "global_span": [ 37797, 37807 ] }, { "id": 279, "label": "Traditional", "start_offset": 422, "end_offset": 430, "text": "CARVYKTI", "global_span": [ 38018, 38026 ] }, { "id": 280, "label": "Value", "start_offset": 436, "end_offset": 448, "text": "$286 million", "global_span": [ 38032, 38044 ] }, { "id": 281, "label": "Traditional", "start_offset": 452, "end_offset": 457, "text": "sales", "global_span": [ 38048, 38053 ] }, { "id": 282, "label": "Value", "start_offset": 459, "end_offset": 462, "text": "88%", "global_span": [ 38055, 38058 ] }, { "id": 283, "label": "Traditional", "start_offset": 463, "end_offset": 488, "text": "growth year - over - year", "global_span": [ 38059, 38084 ] }, { "id": 284, "label": "Value", "start_offset": 493, "end_offset": 495, "text": "53", "global_span": [ 38089, 38091 ] }, { "id": 285, "label": "Traditional", "start_offset": 497, "end_offset": 504, "text": "quarter", "global_span": [ 38093, 38100 ] }, { "id": 286, "label": "Value", "start_offset": 1889, "end_offset": 1903, "text": "4,200 patients", "global_span": [ 39485, 39499 ] }, { "id": 287, "label": "Non_Traditional", "start_offset": 1913, "end_offset": 1921, "text": "CARVYKTI", "global_span": [ 39509, 39517 ] }, { "id": 288, "label": "Traditional", "start_offset": 2142, "end_offset": 2151, "text": "TEC sales", "global_span": [ 39738, 39747 ] }, { "id": 289, "label": "Value", "start_offset": 2157, "end_offset": 2169, "text": "$135 million", "global_span": [ 39753, 39765 ] }, { "id": 290, "label": "Value", "start_offset": 2174, "end_offset": 2184, "text": "21% growth", "global_span": [ 39770, 39780 ] }, { "id": 291, "label": "Traditional", "start_offset": 2193, "end_offset": 2200, "text": "quarter", "global_span": [ 39789, 39796 ] } ], "relations": [ { "id": 125, "entity_ids": [ 275, 276, 277 ], "description": "Value_of" }, { "id": 126, "entity_ids": [ 275, 277, 278 ], "description": "Value_of" }, { "id": 127, "entity_ids": [ 279, 280, 281 ], "description": "Value_of" }, { "id": 128, "entity_ids": [ 279, 282, 283 ], "description": "Value_of" }, { "id": 129, "entity_ids": [ 279, 284, 285 ], "description": "Value_of" }, { "id": 130, "entity_ids": [ 279, 281, 284, 285 ], "description": "Value_of" }, { "id": 131, "entity_ids": [ 286, 287 ], "description": "Value_of" }, { "id": 132, "entity_ids": [ 288, 289 ], "description": "Value_of" }, { "id": 133, "entity_ids": [ 288, 290, 291 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "John Reed: Maybe just a couple of things to highlight as well. With TEC, that is not only the first - in - class BCMA - targeting T - cell engager, but the data really showed also is best - in - class relative to other molecules in that -- of that type. The deepest responses -- complete response rates are approaching 50%, about half of patients. Duration of response is nearly two years, and very low discontinuation rates, less than 5%, showing the weight - adjusted dosing where we can really optimize for the patients, it 's really playing out there. Very excited about the early data we 're seeing when we combine TEC with dara, where we 're seeing really high response rates in patients who have been multiply treated and now in Phase 3 studies in patients with one to three prior lines. And then, similar story with TAL. That is a B - cell preserving target, as you know. So, there are fewer risks of severe infections with TAL. And it has shown in the late line, the highest overall response rates of any T - cell engager bispecific for myeloma. So, we think there 's a lot of upside opportunity there. And again, the data in combo with dara are really impressive. So, we 're marching along with that combination and where we can have the benefits of both the T cell engager together with the CD38 class. And really only J&J is positioned to do that.", "ground_truth_output": { "entities": [ { "id": 292, "label": "Traditional", "start_offset": 400, "end_offset": 425, "text": "low discontinuation rates", "global_span": [ 40999, 41024 ] }, { "id": 293, "label": "Value", "start_offset": 437, "end_offset": 439, "text": "5%", "global_span": [ 41036, 41038 ] } ], "relations": [ { "id": 134, "entity_ids": [ 292, 293 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Next question is coming from Danielle Antalffy with UBS. Your line is now live.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Danielle Antalffy: Hey, good morning, everyone. Thanks so much for taking the question. Just a quick question on the EP business. I mean, obviously, that 's very topical. You have n't really seen much of a slowdown. I appreciate Q3 was probably arguably the first quarter where we had a more -- a full quarter of PFA launching. I guess, I ' m just curious about what you think the underlying market is growing and where PFA is versus RF, and also, as we look ahead to 2025 and VARIPULSE, how that changes dynamics for J&J 's EP business. Thanks so much.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Tim Schmid: Thank you, Danielle. And as you said, it is a really exciting time to be in electrophysiology. And we could n't be more proud of the significant leadership position we ' ve held in this category for more than 20 years. And just to put our performance in context, our EP business is a $5 billion business, which grew 11% in the third quarter and 17% year - to - date. We are actively progressing our launch of VARIPULSE in EMEA and in Japan, where we still are executing against our soft launches. We 've had over 800 successful cases. We shared the data from our admIRE study at the recent HRS meeting showing 85% primary effectiveness in that portfolio and that product. And we believe we ' ve got a product that really will hunt. As it relates to the U.S., you 're right, we 're seeing continued competition, especially in the ablation space, given that we do n't currently have a PFA product. But having spent a lot of time in EP labs over the last couple of weeks, I can tell you that we are incredibly excited for the availability of VARIPULSE, which we expect to have approval sometime later this quarter or in Q1 of next year. We are still, by the way, mapping the majority of those cases, Danielle. That 's what most people do n't see is that while we may not have that product in the portfolio, we are mapping more than 50% of competitive cases. In fact, we ' ve updated our market - leading CARTO software to actually reflect better visualization for competitive products. And what we ' ve seen in the market, and I ca n't give you specific data, but a significant increase in procedures on the time it 's taking EPs to perform ablation procedures with PFA. And by the way, today, we 're benefiting from the volume increase from PFA even though we do n't have that catheter. And so, that combination of the 5,500 installed base of CARTO system 's best - in - class mapping and highly trained mappers, we believe, is a significant advantage and positions us extremely well when PFA comes to market. I will also say that similar to RF, which by the way, we still believe has a play within the portfolio, we have the best - in - class RF catheter with QDOT, 86% primary effectiveness, this winning strategy in RF has been a full portfolio. And similarly, in PFA, beyond our first launch with VARIPULSE, you will see a full portfolio of focal, large focal single shot and dual energy catheters. By the way, we already applied for CE marking for our dual energy catheter. And so, we 're confident in our leadership position in EP and our sources of differentiation for the future. Thank you, Danielle.", "ground_truth_output": { "entities": [ { "id": 294, "label": "Traditional", "start_offset": 280, "end_offset": 291, "text": "EP business", "global_span": [ 42894, 42905 ] }, { "id": 295, "label": "Value", "start_offset": 297, "end_offset": 299, "text": "$5", "global_span": [ 42911, 42913 ] }, { "id": 296, "label": "Traditional", "start_offset": 300, "end_offset": 316, "text": "billion business", "global_span": [ 42914, 42930 ] }, { "id": 297, "label": "Value", "start_offset": 329, "end_offset": 332, "text": "11%", "global_span": [ 42943, 42946 ] }, { "id": 298, "label": "Value", "start_offset": 358, "end_offset": 361, "text": "17%", "global_span": [ 42972, 42975 ] }, { "id": 299, "label": "Traditional", "start_offset": 362, "end_offset": 366, "text": "year", "global_span": [ 42976, 42980 ] }, { "id": 300, "label": "Value", "start_offset": 526, "end_offset": 546, "text": "800 successful cases", "global_span": [ 43140, 43160 ] }, { "id": 301, "label": "Non_Traditional", "start_offset": 603, "end_offset": 606, "text": "HRS", "global_span": [ 43217, 43220 ] }, { "id": 302, "label": "Value", "start_offset": 623, "end_offset": 626, "text": "85%", "global_span": [ 43237, 43240 ] }, { "id": 303, "label": "Non_Traditional", "start_offset": 627, "end_offset": 648, "text": "primary effectiveness", "global_span": [ 43241, 43262 ] }, { "id": 304, "label": "Value", "start_offset": 1342, "end_offset": 1345, "text": "50%", "global_span": [ 43956, 43959 ] }, { "id": 345, "label": "Traditional", "text": "in the third quarter", "start_offset": 333, "end_offset": 353, "global_span": [ 42947, 42967 ] }, { "id": 346, "label": "Traditional", "text": "grew", "start_offset": 324, "end_offset": 328, "global_span": [ 42938, 42942 ] } ], "relations": [ { "id": 135, "entity_ids": [ 294, 295, 296 ], "description": "Value_of" }, { "id": 136, "entity_ids": [ 294, 297, 345, 346 ], "description": "Value_of" }, { "id": 137, "entity_ids": [ 294, 298, 299, 346 ], "description": "Value_of" }, { "id": 138, "entity_ids": [ 301, 302, 303 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Next question today is coming from Shagun Singh from RBC Capital Markets. Your line is now live.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Shagun Singh: Good. Thank you so much. I was hoping you could elaborate on the dynamics that you 're seeing in the Asia Pacific region in MedTech, specifically China. Could you quantify the headwind? When do you expect it to normalize? And you did talk about China VBP, and that has expanded into additional provinces and products. So, could you just elaborate on the impact there, and how we should think about it in ' 25? Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Tim Schmid: Thank you, Shagun. And yes, we ' ve had a myriad of issues hitting us in the Asia Pacific region of late. And let me just highlight a couple, and I 'll certainly get to your question on China. Firstly, you may know that in February of this year in Korea, the government initiated or at least a strike was initiated among the healthcare professional community. Unfortunately, we do n't see any end in sight to that. And so that certainly has been a headwind. We 're seeing macroeconomic pressures in Japan. And then, more importantly, to your question, the ongoing impact of volume - based procurement, which has also been exacerbated by the anti - corruption campaign. And by the way, while we believe this is absolutely the right thing to do and we support it for the long term, it is impacting procedures and the engagement by healthcare professionals with companies like ours, especially on premium products. We have a leadership position. We have the largest medtech company in China. And given the high leadership positions, we are seeing a disproportionate impact from VBP. We have five major categories impacted through tenders in 2023 in electrophysiology, trauma, spine, endocutters and energy, and more recently, IOLs and sports in our Orthopaedics business. We do believe that this will be a headwind through the remainder of ' 24 and into ' 25. That said, we are absolutely confident that China continues and will continue to be an important part of our portfolio. Even with the impact of VBP, we believe we can deliver tremendous growth and returns for our shareholders. And I think this really talks to the strength of our global portfolio across medtech, the fact that we can offset headwinds in one geography with better performance in places like Europe and the U.S. Please rest assured, we also believe that this part of the world, especially in Asia Pacific, will continue to be a growth opportunity. And let me tell you why. 60% of the world 's patients live in that part of the world. And we 're proud of the fact that we ' ve been in many of these markets many, many years and expect to continue to do so. The final point I 'll make is, let 's remember, while, this is a headwind for MedTech, this is not material to Johnson & Johnson. When we look at our global sales across Johnson & Johnson, less than 5% of our business is in China. Thank you again.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 27, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Next question is coming from Vamil Divan from Guggenheim Securities. Your line is now live.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 28, "sub_chunk_id": 0, "sentences": "Vamil Divan: Great. Thanks for taking my question. I have a question on the immunology side, just on TREMFYA and STELARA. So, you mentioned the U.S. sales for both those products were a little bit lighter. And we were expecting and you mentioned this unfavorable patient mix impact in the quarter. So, I ' m just curious if you can just go in a little more detail on what you 're seeing for those products in the U.S. specifically. And is this patient mix issue sort of this quarter? Is it adjustments from prior quarters? And is it something specific to Johnson & Johnson, or is it maybe something broader to the immunology market? Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 29, "sub_chunk_id": 0, "sentences": "Jessica Moore: Yeah, Vamil. If you talk about with patient mix, this would be something that is specific to some of the true - ups that we do. As you are all aware, we end up having to make an assessment on our gross to net reduction. And as we get final bills in, there always are some true - ups. Sometimes they 're for the positive, sometimes it is a negative reduction. So, when we refer to patient mix, this is different patients coming through different channels as well as some of the accounting true - ups for the final payments that we make. Then, I will hand it over to Jennifer to specifically talk about the performance and the commercial perspective of TREMFYA and STELARA in the U.S.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 30, "sub_chunk_id": 0, "sentences": "Jennifer Taubert: And I think -- so if we look for TREMFYA, outside the U.S., really nice growth at 27%. In the U.S., it was a little over 9% specifically for that patient mix issue that Jess just spoke about. We do think that the prospects are very strong for continued TREMFYA growth based on what I articulated before around the launches in ulcerative colitis and the upcoming launches that we 're planning for in Crohn 's disease as well. I think for STELARA, we did see a decline and that, again, sort of similar patient mix piece in the U.S. We ' ve also -- and also we ' ve noted the decline ex U.S., particularly in EMEA due to biosimilar competition. We know that STELARA is near or at its end of life and really that TREMFYA and across the rest of our portfolio, we ' ve got a very robust stable of products with pretty significant growth.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 31, "sub_chunk_id": 0, "sentences": "Jessica Moore: Thank you, Vamil. Kevin, we have time for one last question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 32, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Our final question today is coming from Jayson Bedford from Raymond James. Your line is now live.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 33, "sub_chunk_id": 0, "sentences": "Jayson Bedford: Good morning. Maybe just a question for either Tim or Joe. Appreciate the color on MedTech, but the 5% bogey for the year still implies a decent acceleration in 4Q off a tougher comp. What gets better in 4Q? And then, just a quick clarification. The IV solutions dynamic from Helene, are you seeing an impact on volumes outside of Western North Carolina and Florida? Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 34, "sub_chunk_id": 0, "sentences": "Tim Schmid: Jayson, thank you for the question. And let me hit the last one first. No, we have seen the majority of the impact in the areas impacted by that storm. As I mentioned earlier, I think the watch out is any potential impact from additional shortage of IV fluid, which may impact elective procedures, and certainly, we 're continuing to monitor that very carefully. As Joe mentioned, we expect now on the back of the headwinds we mentioned earlier in Asia Pacific to deliver adjusted operational growth of around 5% and north of 6% on an operational basis for the year. We believe that the momentum we 're carrying into the fourth quarter, especially in our Cardiovascular businesses with our winning portfolio in electrophysiology, strong double - digit growth in Shockwave, Abiomed, I mean, those are, as you can see from the performance, absolute home runs. The other important dynamic here is that, as we signaled in the first and second quarter, we expect to see improvement within our Vision business, which typically has delivered solid single -- mid - single - digit growth. We had a tremendous third quarter, which really gives us confidence in even stronger fourth. This was delivered by much better performance, especially in our contact lens business. In fact, here in the U.S., our most important market, double - digit growth for contact lenses in the quarter. And this just really has been delivered from a stabilization of our distributor inventory in the U.S., the fact that we 're able to get back to taking new wearer share now that we have unconstrained supply, especially within our astig portfolio. And so, we do believe that Vision has a very strong quarter ahead. And then finally, across the portfolio, we 're benefiting from tremendous new product launches, both within Cardiovascular, the E8 peripheral catheter within Shockwave, continued performance within Abiomed with our broad portfolio of pumps. And then, within our surgery business as well as orthopaedics, as I mentioned earlier, tremendous new products to add differentiation to the portfolio. And typically, that fourth quarter also is a stronger one for us. So, once again, very confident in our performance at around 5% on an adjusted basis and north of 6% operationally. Thank you.", "ground_truth_output": { "entities": [ { "id": 305, "label": "Traditional", "start_offset": 485, "end_offset": 512, "text": "adjusted operational growth", "global_span": [ 51556, 51583 ] }, { "id": 306, "label": "Value", "start_offset": 523, "end_offset": 525, "text": "5%", "global_span": [ 51594, 51596 ] }, { "id": 307, "label": "Value", "start_offset": 539, "end_offset": 541, "text": "6%", "global_span": [ 51610, 51612 ] }, { "id": 308, "label": "Traditional", "start_offset": 548, "end_offset": 565, "text": "operational basis", "global_span": [ 51619, 51636 ] } ], "relations": [ { "id": 139, "entity_ids": [ 305, 306 ], "description": "Value_of" }, { "id": 140, "entity_ids": [ 305, 307, 308 ], "description": "Value_of" } ] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 35, "sub_chunk_id": 0, "sentences": "Jessica Moore: Thank you, Jayson, and thanks to everyone for your questions and your continued interest in our company. We apologize to those we could n't get to because of time, but do n't hesitate to reach out to the Investor Relations team with any remaining questions that you may have. I would now turn the call over to Joaquin for some brief closing remarks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 36, "sub_chunk_id": 0, "sentences": "Joaquin Duato: Thank you, everyone, for joining the call today. As you have heard, we delivered strong results in the third quarter. Our high - innovation and high - growth portfolio and pipelines are advancing rapidly, and we are increasingly confident in our expectations for 2025 and beyond. Enjoy the rest of your day.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JNJ", "quarter": 3, "year": 2024, "date": "2024-10-15 08:30:00", "chunk_id": 37, "sub_chunk_id": 0, "sentences": "Operator: Thank you. This concludes today 's Johnson & Johnson 's third quarter 2024 earnings conference call. You may now disconnect.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Operator: Good morning ladies and gentlemen. Welcome to JPMorgan Chase 's Second Quarter 2024 Earnings Call. This call is being recorded. Your line will be muted for the duration of the call. We will now go live to the presentation. The presentation is available on JPMorgan Chase 's website and please refer to the disclaimer in the back concerning forward - looking statements. Please stand by. At this time I would like to turn the call over to JPMorgan Chase 's Chief Financial Officer Jeremy Barnum. Mr. Barnum, please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thank you and good morning everyone. Starting on Page one, the firm reported net income of $18.1 billion, EPS of $6.12 on revenue of $51 billion with an ROTCE of 28%. These results included the $7.9 billion net gain related to Visa shares and the $1 billion foundation contribution of the appreciated Visa stock. Also included is $546 million of net investment securities losses in corporate. Excluding these items, the firm had net income of $13.1 billion, EPS of $4.40, and an ROTCE of 20%. Touching on a couple of highlights, in the CIB, IB fees were up 50% year - on - year and 17% quarter - on - quarter, and market revenue was up 10% year - on - year. In CCB, we had a record number of first - time investors and strong customer acquisition across checking accounts and card and we ' ve continued to see strong net inflows across AWM. Now before I get more detail on the results I just want to mention that starting this quarter we are no longer explicitly calling out the First Republic contribution in the presentation. Going forward, we 'll only specifically call it out if it is a meaningful driver in the year - on - year comparison. As a reminder, we acquired First Republic in May of last year, so the prior year quarter only has two months of First Republic results compared to the full three months this quarter. Also in the prior year quarter most of the expenses were in corporate whereas now they are primarily in the relevant line - of - business. Now turning to Page 2 for the firm - wide results. The firm reported revenue of $51 billion, up $8.6 billion, or 20% year - on - year. Excluding both the Visa gain that I mentioned earlier, as well as last year 's First Republic bargain purchase gain of $2.7 billion, revenue of $43.1 billion was up $3.4 billion or 9%. NII ex - Markets was up $568 million or 3%, driven by the impact of balance sheet mix and higher rates, higher revolving balances in card, and the additional month of First Republic related NII, partially offset by deposit margin compression and lower deposit balances. NIR ex - Markets was up $7.3 billion or 56%. Excluding the items I just mentioned, it was up $2.1 billion or 21%, largely driven by higher investment banking revenue and asset management fees. Both periods included net investment securities losses. And markets revenue was up $731 million or 10% year - on - year. Expenses of $23.7 billion were up $2.9 billion or 14% year - on - year. Excluding the foundation contribution I previously mentioned, expenses were up 9% primarily driven by compensation including revenue related compensation and growth in employees. And credit costs were $3.1 billion reflecting net charge - offs of $2.2 billion and a net reserve build of $821 million. Net charge - offs were up $820 million year - on - year, predominantly driven by Card. The net reserve build included $609 million in consumer and $189 million in wholesale. Onto balance sheet and capital on Page 3. We ended the quarter with a CET1 ratio of 15.3% up 30 basis points versus the prior quarter, primarily driven by net income, largely offset by capital distributions and higher RWA. As you know, we completed CCAR a couple of weeks ago and have already disclosed a number of the key points. Let me summarize them again here. Our preliminary SCB is 3.3%, although the final SCB could be higher. The preliminary SCB, which is up from the current requirement of 2.9%, results in a 12.3% standardized CET1 ratio requirement, which goes into effect in the fourth quarter of 2024. And finally the firm announced that the Board intends to increase the quarterly common stock dividend from $1.15 to $1.25 per share in the third quarter of 2024. Now, let 's go to our businesses, starting with CCB on Page 4. CCB reported net income of $4.2 billion on revenue of $17.7 billion, which was up 3% year - on - year. In banking and wealth management, revenue was down 5% year - on - year, reflecting lower deposits and deposit margin compression, partially offset by growth and wealth management revenue. Average deposits were down 7% year - on - year and 1% quarter - on - quarter. Client investment assets were up 14% year - on - year, predominantly driven by market performance. In home lending, revenue of $1.3 billion was up 31% year - on - year, predominantly driven by higher NII, including one additional month of the First Republic portfolio. Turning to Card services and Auto, revenue was up 14% year - on - year, predominantly driven by higher Card NII and higher revolving balances. Card outstandings were up 12% due to strong account acquisition and the continued normalization of revolve. And in Auto, originations were $10.8 billion, down 10% coming off strong originations from a year ago, while continuing to maintain healthy margins. Expenses of $9.4 billion were up 13% year - on - year, predominantly driven by First Republic expenses now reflected in the lines - of - business, as I mentioned earlier, as well as field compensation and continued growth in technology and marketing. In terms of credit performance this quarter, credit costs were $2.6 billion reflecting net charge - offs of $2.1 billion up $813 million year - on - year, predominantly driven by Card, as newer vintages season and credit normalization continues. The net reserve build was $579 million, also driven by Card, due to loan growth and updates to certain macroeconomic variables. Next, the Commercial and Investment Bank on Page 5. Our new Commercial and Investment Bank reported net income of $5.9 billion on revenue of $17.9 billion. You 'll note that we are disclosing revenue by business, as well as breaking down the banking and payments revenue by client coverage segment in order to best highlight the relevant trends in both important dimensions of the wholesale franchise. This quarter, IB fees were up 50% year - on - year, and we Ranked Number # 1 with year - to - date wallet share of 9.5%. And advisory, fees were up 45%, primarily driven by the closing of a few large deals in a week prior year quarter. Underwriting fees were up meaningfully with equity up 56% and debt up 51%, benefiting from favorable market conditions. In terms of the outlook, we 're pleased with both the year - on - year and sequential improvement in the quarter. We remain cautiously optimistic about the pipeline, although many of the same headwinds are still in effect. It 's also worth noting that pull - forward refinancing activity was a meaningful contributor to the strong performance in the first half of the year. Payments revenue was $4.5 billion, down 4% year - on - year, as deposit margin compression and higher deposit related client credits were largely offset by fee growth. Moving to markets, total revenue was $7.8 billion, up 10% year - on - year. Fixed income was up 5% with continued strength in securitized products. And equity markets was up 21%, with equity derivatives up on improved client activity. We saw record revenue in Prime on growth and client balances amid supportive equity market levels. Security services revenue of $1.3 billion was up 3% year - on - year, driven by higher volumes and market levels, largely offset by deposit margin compression. Expenses of $9.2 billion were up 12% year - on - year, largely driven by higher revenue related compensation, legal expense, and volume related non - compensation expense. In banking and payments, average loans were up 2% year - on - year due to the impact of the First Republic acquisition and flat sequentially. Demand for new loans remains muted as middle market and large corporate clients remain somewhat cautious due to the economic environment, and revolver utilization continues to be below pre - pandemic levels. Also, capital markets are open and are providing an alternative to traditional bank lending for these clients. In CRE, higher rates continue to suppress both loan origination and payoff activity. Average client deposits were up 2% year - on - year and relatively flat sequentially. Finally, credit costs were $384 million. The net reserve build of $220 million was primarily driven by incorporating the First Republic portfolio in the Firm 's modeled approach. Net charge - offs were $164 million, of which about half was in office. Then to complete our lines - of - business, AWM on Page 6. Asset and wealth management reported net income of $1.3 billion with pre - tax margin of 32%. Revenue of $5.3 billion was up 6% year - on - year, driven by growth in management fees on higher average market levels and strong net inflows, as well as higher brokerage activity, largely offset by deposit margin compression. Expenses of $3.5 billion were up 12% year - on - year, largely driven by higher compensation, primarily revenue - related compensation, and continued growth in our private banking advisor teams. For the quarter, long - term net inflows were $52 billion, led by equities and fixed income. And in liquidity, we saw net inflows of $16 billion. AUM of $3.7 trillion was up 15% year - on - year. And client assets of $5.4 trillion were up 18% year - on - year, driven by higher market levels and continued net inflows. And finally, loans and deposits were both flat quarter - on - quarter. Turning to corporate on Page 7. Corporate reported net income of $6.8 billion on revenue of $10.1 billion. Excluding this quarter 's Visa - related gain and the First Republic bargain purchase gain in the prior year, NIR was up approximately $450 million year - on - year. NII was up $626 million year - on - year, driven by the impact of balance sheet mix and higher rates. Expenses of $1.6 billion were up $427 million year - on - year, excluding foundation contribution expenses were down $573 million year - on - year, largely as a result of moving First Republic related expense out of corporate into the relevant segments. To finish up, we have the outlook on Page 8. Our 2024 guidance, including the drivers, remains unchanged from what we said at Investor Day. We continue to expect NII and NII ex - markets of approximately $91 billion, adjusted expense of about $92 billion, and on credit, Card net charge - off rate of approximately 3.4%. So to wrap up, the reported performance for the quarter was exceptional and actually represents record revenue and net income. But more importantly, after excluding the significant items, the underlying performance continues to be quite strong. And as always, we remain focused on continuing to execute with discipline. And with that, let 's open the line for Q&A.", "ground_truth_output": { "entities": [ { "id": 0, "label": "Traditional", "start_offset": 93, "end_offset": 103, "text": "net income", "global_span": [ 627, 637 ] }, { "id": 1, "label": "Value", "start_offset": 107, "end_offset": 120, "text": "$18.1 billion", "global_span": [ 641, 654 ] }, { "id": 2, "label": "Traditional", "start_offset": 122, "end_offset": 125, "text": "EPS", "global_span": [ 656, 659 ] }, { "id": 3, "label": "Value", "start_offset": 129, "end_offset": 134, "text": "$6.12", "global_span": [ 663, 668 ] }, { "id": 4, "label": "Traditional", "start_offset": 138, "end_offset": 145, "text": "revenue", "global_span": [ 672, 679 ] }, { "id": 5, "label": "Value", "start_offset": 149, "end_offset": 160, "text": "$51 billion", "global_span": [ 683, 694 ] }, { "id": 6, "label": "Traditional", "start_offset": 169, "end_offset": 174, "text": "ROTCE", "global_span": [ 703, 708 ] }, { "id": 7, "label": "Value", "start_offset": 175, "end_offset": 181, "text": "of 28%", "global_span": [ 709, 715 ] }, { "id": 8, "label": "Value", "start_offset": 210, "end_offset": 222, "text": "$7.9 billion", "global_span": [ 744, 756 ] }, { "id": 9, "label": "Traditional", "start_offset": 223, "end_offset": 231, "text": "net gain", "global_span": [ 757, 765 ] }, { "id": 10, "label": "Traditional", "start_offset": 243, "end_offset": 254, "text": "Visa shares", "global_span": [ 777, 788 ] }, { "id": 11, "label": "Value", "start_offset": 263, "end_offset": 273, "text": "$1 billion", "global_span": [ 797, 807 ] }, { "id": 12, "label": "Traditional", "start_offset": 274, "end_offset": 297, "text": "foundation contribution", "global_span": [ 808, 831 ] }, { "id": 13, "label": "Traditional", "start_offset": 305, "end_offset": 327, "text": "appreciated Visa stock", "global_span": [ 839, 861 ] }, { "id": 14, "label": "Value", "start_offset": 346, "end_offset": 358, "text": "$546 million", "global_span": [ 880, 892 ] }, { "id": 15, "label": "Traditional", "start_offset": 362, "end_offset": 387, "text": "net investment securities", "global_span": [ 896, 921 ] }, { "id": 16, "label": "Value", "start_offset": 459, "end_offset": 472, "text": "$13.1 billion", "global_span": [ 993, 1006 ] }, { "id": 17, "label": "Traditional", "start_offset": 474, "end_offset": 477, "text": "EPS", "global_span": [ 1008, 1011 ] }, { "id": 18, "label": "Value", "start_offset": 481, "end_offset": 486, "text": "$4.40", "global_span": [ 1015, 1020 ] }, { "id": 19, "label": "Traditional", "start_offset": 495, "end_offset": 500, "text": "ROTCE", "global_span": [ 1029, 1034 ] }, { "id": 20, "label": "Value", "start_offset": 504, "end_offset": 507, "text": "20%", "global_span": [ 1038, 1041 ] }, { "id": 21, "label": "Non_Traditional", "start_offset": 557, "end_offset": 564, "text": "IB fees", "global_span": [ 1091, 1098 ] }, { "id": 22, "label": "Value", "start_offset": 573, "end_offset": 576, "text": "50%", "global_span": [ 1107, 1110 ] }, { "id": 23, "label": "Non_Traditional", "start_offset": 577, "end_offset": 581, "text": "year", "global_span": [ 1111, 1115 ] }, { "id": 24, "label": "Non_Traditional", "start_offset": 584, "end_offset": 586, "text": "on", "global_span": [ 1118, 1120 ] }, { "id": 25, "label": "Non_Traditional", "start_offset": 589, "end_offset": 593, "text": "year", "global_span": [ 1123, 1127 ] }, { "id": 26, "label": "Value", "start_offset": 598, "end_offset": 601, "text": "17%", "global_span": [ 1132, 1135 ] }, { "id": 27, "label": "Traditional", "start_offset": 602, "end_offset": 609, "text": "quarter", "global_span": [ 1136, 1143 ] }, { "id": 28, "label": "Traditional", "start_offset": 612, "end_offset": 614, "text": "on", "global_span": [ 1146, 1148 ] }, { "id": 29, "label": "Traditional", "start_offset": 617, "end_offset": 624, "text": "quarter", "global_span": [ 1151, 1158 ] }, { "id": 30, "label": "Traditional", "start_offset": 630, "end_offset": 644, "text": "market revenue", "global_span": [ 1164, 1178 ] }, { "id": 31, "label": "Traditional", "start_offset": 649, "end_offset": 651, "text": "up", "global_span": [ 1183, 1185 ] }, { "id": 32, "label": "Value", "start_offset": 652, "end_offset": 655, "text": "10%", "global_span": [ 1186, 1189 ] }, { "id": 33, "label": "Traditional", "start_offset": 656, "end_offset": 660, "text": "year", "global_span": [ 1190, 1194 ] }, { "id": 34, "label": "Traditional", "start_offset": 663, "end_offset": 665, "text": "on", "global_span": [ 1197, 1199 ] }, { "id": 35, "label": "Traditional", "start_offset": 668, "end_offset": 672, "text": "year", "global_span": [ 1202, 1206 ] }, { "id": 36, "label": "Traditional", "start_offset": 1552, "end_offset": 1559, "text": "revenue", "global_span": [ 2086, 2093 ] }, { "id": 37, "label": "Value", "start_offset": 1563, "end_offset": 1574, "text": "$51 billion", "global_span": [ 2097, 2108 ] }, { "id": 38, "label": "Traditional", "start_offset": 1576, "end_offset": 1578, "text": "up", "global_span": [ 2110, 2112 ] }, { "id": 39, "label": "Value", "start_offset": 1579, "end_offset": 1591, "text": "$8.6 billion", "global_span": [ 2113, 2125 ] }, { "id": 40, "label": "Value", "start_offset": 1596, "end_offset": 1599, "text": "20%", "global_span": [ 2130, 2133 ] }, { "id": 41, "label": "Traditional", "start_offset": 1600, "end_offset": 1604, "text": "year", "global_span": [ 2134, 2138 ] }, { "id": 42, "label": "Traditional", "start_offset": 1607, "end_offset": 1609, "text": "on", "global_span": [ 2141, 2143 ] }, { "id": 43, "label": "Traditional", "start_offset": 1612, "end_offset": 1616, "text": "year", "global_span": [ 2146, 2150 ] }, { "id": 44, "label": "Traditional", "start_offset": 1720, "end_offset": 1733, "text": "purchase gain", "global_span": [ 2254, 2267 ] }, { "id": 45, "label": "Value", "start_offset": 1737, "end_offset": 1749, "text": "$2.7 billion", "global_span": [ 2271, 2283 ] }, { "id": 46, "label": "Traditional", "start_offset": 1751, "end_offset": 1758, "text": "revenue", "global_span": [ 2285, 2292 ] }, { "id": 47, "label": "Value", "start_offset": 1762, "end_offset": 1767, "text": "$43.1", "global_span": [ 2296, 2301 ] }, { "id": 48, "label": "Traditional", "start_offset": 1768, "end_offset": 1775, "text": "billion", "global_span": [ 2302, 2309 ] }, { "id": 49, "label": "Traditional", "start_offset": 1780, "end_offset": 1782, "text": "up", "global_span": [ 2314, 2316 ] }, { "id": 50, "label": "Value", "start_offset": 1783, "end_offset": 1795, "text": "$3.4 billion", "global_span": [ 2317, 2329 ] }, { "id": 51, "label": "Value", "start_offset": 1799, "end_offset": 1801, "text": "9%", "global_span": [ 2333, 2335 ] }, { "id": 52, "label": "Traditional", "start_offset": 1812, "end_offset": 1819, "text": "Markets", "global_span": [ 2346, 2353 ] }, { "id": 53, "label": "Value", "start_offset": 1827, "end_offset": 1839, "text": "$568 million", "global_span": [ 2361, 2373 ] }, { "id": 54, "label": "Value", "start_offset": 1843, "end_offset": 1845, "text": "3%", "global_span": [ 2377, 2379 ] }, { "id": 55, "label": "Traditional", "start_offset": 2073, "end_offset": 2079, "text": "NIR ex", "global_span": [ 2607, 2613 ] }, { "id": 56, "label": "Traditional", "start_offset": 2082, "end_offset": 2089, "text": "Markets", "global_span": [ 2616, 2623 ] }, { "id": 57, "label": "Value", "start_offset": 2097, "end_offset": 2109, "text": "$7.3 billion", "global_span": [ 2631, 2643 ] }, { "id": 58, "label": "Value", "start_offset": 2113, "end_offset": 2116, "text": "56%", "global_span": [ 2647, 2650 ] }, { "id": 59, "label": "Value", "start_offset": 2166, "end_offset": 2178, "text": "$2.1 billion", "global_span": [ 2700, 2712 ] }, { "id": 60, "label": "Value", "start_offset": 2182, "end_offset": 2185, "text": "21%", "global_span": [ 2716, 2719 ] }, { "id": 61, "label": "Traditional", "start_offset": 2326, "end_offset": 2341, "text": "markets revenue", "global_span": [ 2860, 2875 ] }, { "id": 62, "label": "Value", "start_offset": 2349, "end_offset": 2361, "text": "$731 million", "global_span": [ 2883, 2895 ] }, { "id": 63, "label": "Value", "start_offset": 2365, "end_offset": 2368, "text": "10%", "global_span": [ 2899, 2902 ] }, { "id": 64, "label": "Traditional", "start_offset": 2369, "end_offset": 2373, "text": "year", "global_span": [ 2903, 2907 ] }, { "id": 65, "label": "Traditional", "start_offset": 2376, "end_offset": 2378, "text": "on", "global_span": [ 2910, 2912 ] }, { "id": 66, "label": "Traditional", "start_offset": 2381, "end_offset": 2385, "text": "year", "global_span": [ 2915, 2919 ] }, { "id": 67, "label": "Traditional", "start_offset": 2387, "end_offset": 2395, "text": "Expenses", "global_span": [ 2921, 2929 ] }, { "id": 68, "label": "Value", "start_offset": 2399, "end_offset": 2412, "text": "$23.7 billion", "global_span": [ 2933, 2946 ] }, { "id": 69, "label": "Value", "start_offset": 2421, "end_offset": 2433, "text": "$2.9 billion", "global_span": [ 2955, 2967 ] }, { "id": 70, "label": "Value", "start_offset": 2437, "end_offset": 2440, "text": "14%", "global_span": [ 2971, 2974 ] }, { "id": 71, "label": "Traditional", "start_offset": 2441, "end_offset": 2445, "text": "year", "global_span": [ 2975, 2979 ] }, { "id": 72, "label": "Traditional", "start_offset": 2448, "end_offset": 2450, "text": "on", "global_span": [ 2982, 2984 ] }, { "id": 73, "label": "Traditional", "start_offset": 2453, "end_offset": 2457, "text": "year", "global_span": [ 2987, 2991 ] }, { "id": 74, "label": "Traditional", "start_offset": 2521, "end_offset": 2529, "text": "expenses", "global_span": [ 3055, 3063 ] }, { "id": 75, "label": "Traditional", "start_offset": 2535, "end_offset": 2537, "text": "up", "global_span": [ 3069, 3071 ] }, { "id": 76, "label": "Value", "start_offset": 2538, "end_offset": 2540, "text": "9%", "global_span": [ 3072, 3074 ] }, { "id": 77, "label": "Traditional", "start_offset": 2642, "end_offset": 2654, "text": "credit costs", "global_span": [ 3176, 3188 ] }, { "id": 78, "label": "Value", "start_offset": 2660, "end_offset": 2672, "text": "$3.1 billion", "global_span": [ 3194, 3206 ] }, { "id": 79, "label": "Value", "start_offset": 2705, "end_offset": 2717, "text": "$2.2 billion", "global_span": [ 3239, 3251 ] }, { "id": 80, "label": "Traditional", "start_offset": 2724, "end_offset": 2735, "text": "net reserve", "global_span": [ 3258, 3269 ] }, { "id": 81, "label": "Value", "start_offset": 2745, "end_offset": 2757, "text": "$821 million", "global_span": [ 3279, 3291 ] }, { "id": 82, "label": "Traditional", "start_offset": 2759, "end_offset": 2769, "text": "Net charge", "global_span": [ 3293, 3303 ] }, { "id": 83, "label": "Traditional", "start_offset": 2772, "end_offset": 2776, "text": "offs", "global_span": [ 3306, 3310 ] }, { "id": 84, "label": "Value", "start_offset": 2785, "end_offset": 2797, "text": "$820 million", "global_span": [ 3319, 3331 ] }, { "id": 85, "label": "Traditional", "start_offset": 2798, "end_offset": 2802, "text": "year", "global_span": [ 3332, 3336 ] }, { "id": 86, "label": "Traditional", "start_offset": 2805, "end_offset": 2807, "text": "on", "global_span": [ 3339, 3341 ] }, { "id": 87, "label": "Traditional", "start_offset": 2810, "end_offset": 2814, "text": "year", "global_span": [ 3344, 3348 ] }, { "id": 88, "label": "Traditional", "start_offset": 2850, "end_offset": 2861, "text": "net reserve", "global_span": [ 3384, 3395 ] }, { "id": 89, "label": "Value", "start_offset": 2877, "end_offset": 2889, "text": "$609 million", "global_span": [ 3411, 3423 ] }, { "id": 90, "label": "Traditional", "start_offset": 2893, "end_offset": 2901, "text": "consumer", "global_span": [ 3427, 3435 ] }, { "id": 91, "label": "Value", "start_offset": 2906, "end_offset": 2918, "text": "$189 million", "global_span": [ 3440, 3452 ] }, { "id": 92, "label": "Traditional", "start_offset": 2922, "end_offset": 2931, "text": "wholesale", "global_span": [ 3456, 3465 ] }, { "id": 93, "label": "Traditional", "start_offset": 3003, "end_offset": 3013, "text": "CET1 ratio", "global_span": [ 3537, 3547 ] }, { "id": 94, "label": "Value", "start_offset": 3017, "end_offset": 3022, "text": "15.3%", "global_span": [ 3551, 3556 ] }, { "id": 95, "label": "Value", "start_offset": 3026, "end_offset": 3041, "text": "30 basis points", "global_span": [ 3560, 3575 ] }, { "id": 96, "label": "Traditional", "start_offset": 3314, "end_offset": 3317, "text": "SCB", "global_span": [ 3848, 3851 ] }, { "id": 97, "label": "Value", "start_offset": 3321, "end_offset": 3325, "text": "3.3%", "global_span": [ 3855, 3859 ] }, { "id": 98, "label": "Traditional", "start_offset": 3346, "end_offset": 3349, "text": "SCB", "global_span": [ 3880, 3883 ] }, { "id": 99, "label": "Traditional", "start_offset": 3618, "end_offset": 3649, "text": "quarterly common stock dividend", "global_span": [ 4152, 4183 ] }, { "id": 100, "label": "Value", "start_offset": 3655, "end_offset": 3660, "text": "$1.15", "global_span": [ 4189, 4194 ] }, { "id": 101, "label": "Value", "start_offset": 3664, "end_offset": 3669, "text": "$1.25", "global_span": [ 4198, 4203 ] }, { "id": 102, "label": "Traditional", "start_offset": 3670, "end_offset": 3679, "text": "per share", "global_span": [ 4204, 4213 ] }, { "id": 103, "label": "Traditional", "start_offset": 3786, "end_offset": 3796, "text": "net income", "global_span": [ 4320, 4330 ] }, { "id": 104, "label": "Value", "start_offset": 3800, "end_offset": 3812, "text": "$4.2 billion", "global_span": [ 4334, 4346 ] }, { "id": 105, "label": "Traditional", "start_offset": 3816, "end_offset": 3823, "text": "revenue", "global_span": [ 4350, 4357 ] }, { "id": 106, "label": "Value", "start_offset": 3827, "end_offset": 3840, "text": "$17.7 billion", "global_span": [ 4361, 4374 ] }, { "id": 107, "label": "Value", "start_offset": 3855, "end_offset": 3857, "text": "3%", "global_span": [ 4389, 4391 ] }, { "id": 108, "label": "Traditional", "start_offset": 3858, "end_offset": 3862, "text": "year", "global_span": [ 4392, 4396 ] }, { "id": 109, "label": "Traditional", "start_offset": 3865, "end_offset": 3867, "text": "on", "global_span": [ 4399, 4401 ] }, { "id": 110, "label": "Traditional", "start_offset": 3870, "end_offset": 3874, "text": "year", "global_span": [ 4404, 4408 ] }, { "id": 111, "label": "Traditional", "start_offset": 3879, "end_offset": 3886, "text": "banking", "global_span": [ 4413, 4420 ] }, { "id": 112, "label": "Traditional", "start_offset": 3891, "end_offset": 3908, "text": "wealth management", "global_span": [ 4425, 4442 ] }, { "id": 113, "label": "Traditional", "start_offset": 3910, "end_offset": 3917, "text": "revenue", "global_span": [ 4444, 4451 ] }, { "id": 114, "label": "Value", "start_offset": 3927, "end_offset": 3929, "text": "5%", "global_span": [ 4461, 4463 ] }, { "id": 115, "label": "Traditional", "start_offset": 3930, "end_offset": 3934, "text": "year", "global_span": [ 4464, 4468 ] }, { "id": 116, "label": "Traditional", "start_offset": 3937, "end_offset": 3939, "text": "on", "global_span": [ 4471, 4473 ] }, { "id": 117, "label": "Traditional", "start_offset": 3942, "end_offset": 3946, "text": "year", "global_span": [ 4476, 4480 ] }, { "id": 118, "label": "Traditional", "start_offset": 4064, "end_offset": 4080, "text": "Average deposits", "global_span": [ 4598, 4614 ] }, { "id": 119, "label": "Value", "start_offset": 4091, "end_offset": 4093, "text": "7%", "global_span": [ 4625, 4627 ] }, { "id": 120, "label": "Traditional", "start_offset": 4094, "end_offset": 4098, "text": "year", "global_span": [ 4628, 4632 ] }, { "id": 121, "label": "Traditional", "start_offset": 4101, "end_offset": 4103, "text": "on", "global_span": [ 4635, 4637 ] }, { "id": 122, "label": "Traditional", "start_offset": 4106, "end_offset": 4110, "text": "year", "global_span": [ 4640, 4644 ] }, { "id": 123, "label": "Value", "start_offset": 4115, "end_offset": 4117, "text": "1%", "global_span": [ 4649, 4651 ] }, { "id": 124, "label": "Traditional", "start_offset": 4118, "end_offset": 4125, "text": "quarter", "global_span": [ 4652, 4659 ] }, { "id": 125, "label": "Traditional", "start_offset": 4128, "end_offset": 4130, "text": "on", "global_span": [ 4662, 4664 ] }, { "id": 126, "label": "Traditional", "start_offset": 4133, "end_offset": 4140, "text": "quarter", "global_span": [ 4667, 4674 ] }, { "id": 127, "label": "Traditional", "start_offset": 4142, "end_offset": 4166, "text": "Client investment assets", "global_span": [ 4676, 4700 ] }, { "id": 128, "label": "Traditional", "start_offset": 4172, "end_offset": 4174, "text": "up", "global_span": [ 4706, 4708 ] }, { "id": 129, "label": "Value", "start_offset": 4175, "end_offset": 4178, "text": "14%", "global_span": [ 4709, 4712 ] }, { "id": 130, "label": "Traditional", "start_offset": 4179, "end_offset": 4183, "text": "year", "global_span": [ 4713, 4717 ] }, { "id": 131, "label": "Traditional", "start_offset": 4186, "end_offset": 4188, "text": "on", "global_span": [ 4720, 4722 ] }, { "id": 132, "label": "Traditional", "start_offset": 4191, "end_offset": 4195, "text": "year", "global_span": [ 4725, 4729 ] }, { "id": 133, "label": "Traditional", "start_offset": 4244, "end_offset": 4256, "text": "home lending", "global_span": [ 4778, 4790 ] }, { "id": 134, "label": "Traditional", "start_offset": 4258, "end_offset": 4265, "text": "revenue", "global_span": [ 4792, 4799 ] }, { "id": 135, "label": "Value", "start_offset": 4269, "end_offset": 4281, "text": "$1.3 billion", "global_span": [ 4803, 4815 ] }, { "id": 136, "label": "Value", "start_offset": 4289, "end_offset": 4292, "text": "31%", "global_span": [ 4823, 4826 ] }, { "id": 137, "label": "Traditional", "start_offset": 4293, "end_offset": 4297, "text": "year", "global_span": [ 4827, 4831 ] }, { "id": 138, "label": "Traditional", "start_offset": 4300, "end_offset": 4302, "text": "on", "global_span": [ 4834, 4836 ] }, { "id": 139, "label": "Traditional", "start_offset": 4305, "end_offset": 4309, "text": "year", "global_span": [ 4839, 4843 ] }, { "id": 140, "label": "Traditional", "start_offset": 4440, "end_offset": 4444, "text": "Auto", "global_span": [ 4974, 4978 ] }, { "id": 141, "label": "Traditional", "start_offset": 4446, "end_offset": 4453, "text": "revenue", "global_span": [ 4980, 4987 ] }, { "id": 142, "label": "Value", "start_offset": 4461, "end_offset": 4464, "text": "14%", "global_span": [ 4995, 4998 ] }, { "id": 143, "label": "Traditional", "start_offset": 4465, "end_offset": 4469, "text": "year", "global_span": [ 4999, 5003 ] }, { "id": 144, "label": "Traditional", "start_offset": 4472, "end_offset": 4474, "text": "on", "global_span": [ 5006, 5008 ] }, { "id": 145, "label": "Traditional", "start_offset": 4477, "end_offset": 4481, "text": "year", "global_span": [ 5011, 5015 ] }, { "id": 146, "label": "Traditional", "start_offset": 4554, "end_offset": 4571, "text": "Card outstandings", "global_span": [ 5088, 5105 ] }, { "id": 147, "label": "Value", "start_offset": 4580, "end_offset": 4583, "text": "12%", "global_span": [ 5114, 5117 ] }, { "id": 148, "label": "Traditional", "start_offset": 4669, "end_offset": 4673, "text": "Auto", "global_span": [ 5203, 5207 ] }, { "id": 149, "label": "Traditional", "start_offset": 4675, "end_offset": 4687, "text": "originations", "global_span": [ 5209, 5221 ] }, { "id": 150, "label": "Value", "start_offset": 4693, "end_offset": 4706, "text": "$10.8 billion", "global_span": [ 5227, 5240 ] }, { "id": 151, "label": "Value", "start_offset": 4713, "end_offset": 4716, "text": "10%", "global_span": [ 5247, 5250 ] }, { "id": 152, "label": "Traditional", "start_offset": 4811, "end_offset": 4819, "text": "Expenses", "global_span": [ 5345, 5353 ] }, { "id": 153, "label": "Value", "start_offset": 4824, "end_offset": 4835, "text": "9.4 billion", "global_span": [ 5358, 5369 ] }, { "id": 154, "label": "Value", "start_offset": 4844, "end_offset": 4847, "text": "13%", "global_span": [ 5378, 5381 ] }, { "id": 155, "label": "Traditional", "start_offset": 4848, "end_offset": 4852, "text": "year", "global_span": [ 5382, 5386 ] }, { "id": 156, "label": "Traditional", "start_offset": 4855, "end_offset": 4857, "text": "on", "global_span": [ 5389, 5391 ] }, { "id": 157, "label": "Traditional", "start_offset": 4860, "end_offset": 4864, "text": "year", "global_span": [ 5394, 5398 ] }, { "id": 158, "label": "Traditional", "start_offset": 5107, "end_offset": 5119, "text": "credit costs", "global_span": [ 5641, 5653 ] }, { "id": 159, "label": "Value", "start_offset": 5125, "end_offset": 5137, "text": "$2.6 billion", "global_span": [ 5659, 5671 ] }, { "id": 160, "label": "Value", "start_offset": 5170, "end_offset": 5182, "text": "$2.1 billion", "global_span": [ 5704, 5716 ] }, { "id": 161, "label": "Value", "start_offset": 5186, "end_offset": 5198, "text": "$813 million", "global_span": [ 5720, 5732 ] }, { "id": 162, "label": "Traditional", "start_offset": 5199, "end_offset": 5203, "text": "year", "global_span": [ 5733, 5737 ] }, { "id": 163, "label": "Traditional", "start_offset": 5206, "end_offset": 5208, "text": "on", "global_span": [ 5740, 5742 ] }, { "id": 164, "label": "Traditional", "start_offset": 5211, "end_offset": 5215, "text": "year", "global_span": [ 5745, 5749 ] }, { "id": 165, "label": "Value", "start_offset": 5334, "end_offset": 5346, "text": "$579 million", "global_span": [ 5868, 5880 ] }, { "id": 166, "label": "Traditional", "start_offset": 5496, "end_offset": 5506, "text": "Commercial", "global_span": [ 6030, 6040 ] }, { "id": 167, "label": "Traditional", "start_offset": 5511, "end_offset": 5526, "text": "Investment Bank", "global_span": [ 6045, 6060 ] }, { "id": 168, "label": "Traditional", "start_offset": 5536, "end_offset": 5546, "text": "net income", "global_span": [ 6070, 6080 ] }, { "id": 169, "label": "Value", "start_offset": 5550, "end_offset": 5562, "text": "$5.9 billion", "global_span": [ 6084, 6096 ] }, { "id": 170, "label": "Value", "start_offset": 5577, "end_offset": 5590, "text": "$17.9 billion", "global_span": [ 6111, 6124 ] }, { "id": 171, "label": "Traditional", "start_offset": 5852, "end_offset": 5859, "text": "IB fees", "global_span": [ 6386, 6393 ] }, { "id": 172, "label": "Traditional", "start_offset": 5865, "end_offset": 5867, "text": "up", "global_span": [ 6399, 6401 ] }, { "id": 173, "label": "Value", "start_offset": 5868, "end_offset": 5871, "text": "50%", "global_span": [ 6402, 6405 ] }, { "id": 174, "label": "Traditional", "start_offset": 5872, "end_offset": 5876, "text": "year", "global_span": [ 6406, 6410 ] }, { "id": 175, "label": "Traditional", "start_offset": 5879, "end_offset": 5881, "text": "on", "global_span": [ 6413, 6415 ] }, { "id": 176, "label": "Traditional", "start_offset": 5884, "end_offset": 5888, "text": "year", "global_span": [ 6418, 6422 ] }, { "id": 177, "label": "Non_Traditional", "start_offset": 5897, "end_offset": 5910, "text": "Ranked Number", "global_span": [ 6431, 6444 ] }, { "id": 178, "label": "Value", "start_offset": 5911, "end_offset": 5914, "text": "# 1", "global_span": [ 6445, 6448 ] }, { "id": 179, "label": "Traditional", "start_offset": 5920, "end_offset": 5924, "text": "year", "global_span": [ 6454, 6458 ] }, { "id": 180, "label": "Traditional", "start_offset": 5927, "end_offset": 5929, "text": "to", "global_span": [ 6461, 6463 ] }, { "id": 181, "label": "Traditional", "start_offset": 5932, "end_offset": 5952, "text": "date wallet share of", "global_span": [ 6466, 6486 ] }, { "id": 182, "label": "Value", "start_offset": 5953, "end_offset": 5957, "text": "9.5%", "global_span": [ 6487, 6491 ] }, { "id": 183, "label": "Value", "start_offset": 5986, "end_offset": 5989, "text": "45%", "global_span": [ 6520, 6523 ] }, { "id": 184, "label": "Traditional", "start_offset": 6074, "end_offset": 6091, "text": "Underwriting fees", "global_span": [ 6608, 6625 ] }, { "id": 185, "label": "Value", "start_offset": 6128, "end_offset": 6131, "text": "56%", "global_span": [ 6662, 6665 ] }, { "id": 186, "label": "Value", "start_offset": 6144, "end_offset": 6147, "text": "51%", "global_span": [ 6678, 6681 ] }, { "id": 187, "label": "Traditional", "start_offset": 6568, "end_offset": 6584, "text": "Payments revenue", "global_span": [ 7102, 7118 ] }, { "id": 188, "label": "Value", "start_offset": 6589, "end_offset": 6601, "text": "$4.5 billion", "global_span": [ 7123, 7135 ] }, { "id": 189, "label": "Value", "start_offset": 6603, "end_offset": 6610, "text": "down 4%", "global_span": [ 7137, 7144 ] }, { "id": 190, "label": "Traditional", "start_offset": 6611, "end_offset": 6615, "text": "year", "global_span": [ 7145, 7149 ] }, { "id": 191, "label": "Traditional", "start_offset": 6618, "end_offset": 6620, "text": "on", "global_span": [ 7152, 7154 ] }, { "id": 192, "label": "Traditional", "start_offset": 6623, "end_offset": 6627, "text": "year", "global_span": [ 7157, 7161 ] }, { "id": 193, "label": "Traditional", "start_offset": 6746, "end_offset": 6753, "text": "markets", "global_span": [ 7280, 7287 ] }, { "id": 194, "label": "Traditional", "start_offset": 6755, "end_offset": 6768, "text": "total revenue", "global_span": [ 7289, 7302 ] }, { "id": 195, "label": "Value", "start_offset": 6773, "end_offset": 6785, "text": "$7.8 billion", "global_span": [ 7307, 7319 ] }, { "id": 196, "label": "Value", "start_offset": 6790, "end_offset": 6793, "text": "10%", "global_span": [ 7324, 7327 ] }, { "id": 197, "label": "Traditional", "start_offset": 6794, "end_offset": 6798, "text": "year", "global_span": [ 7328, 7332 ] }, { "id": 198, "label": "Traditional", "start_offset": 6801, "end_offset": 6803, "text": "on", "global_span": [ 7335, 7337 ] }, { "id": 199, "label": "Traditional", "start_offset": 6806, "end_offset": 6810, "text": "year", "global_span": [ 7340, 7344 ] }, { "id": 200, "label": "Traditional", "start_offset": 6812, "end_offset": 6824, "text": "Fixed income", "global_span": [ 7346, 7358 ] }, { "id": 201, "label": "Value", "start_offset": 6832, "end_offset": 6834, "text": "5%", "global_span": [ 7366, 7368 ] }, { "id": 202, "label": "Traditional", "start_offset": 6888, "end_offset": 6902, "text": "equity markets", "global_span": [ 7422, 7436 ] }, { "id": 203, "label": "Value", "start_offset": 6910, "end_offset": 6913, "text": "21%", "global_span": [ 7444, 7447 ] }, { "id": 204, "label": "Traditional", "start_offset": 7070, "end_offset": 7095, "text": "Security services revenue", "global_span": [ 7604, 7629 ] }, { "id": 205, "label": "Value", "start_offset": 7099, "end_offset": 7111, "text": "$1.3 billion", "global_span": [ 7633, 7645 ] }, { "id": 206, "label": "Value", "start_offset": 7119, "end_offset": 7121, "text": "3%", "global_span": [ 7653, 7655 ] }, { "id": 207, "label": "Traditional", "start_offset": 7122, "end_offset": 7126, "text": "year", "global_span": [ 7656, 7660 ] }, { "id": 208, "label": "Traditional", "start_offset": 7129, "end_offset": 7131, "text": "on", "global_span": [ 7663, 7665 ] }, { "id": 209, "label": "Traditional", "start_offset": 7134, "end_offset": 7138, "text": "year", "global_span": [ 7668, 7672 ] }, { "id": 210, "label": "Traditional", "start_offset": 7230, "end_offset": 7238, "text": "Expenses", "global_span": [ 7764, 7772 ] }, { "id": 211, "label": "Value", "start_offset": 7242, "end_offset": 7254, "text": "$9.2 billion", "global_span": [ 7776, 7788 ] }, { "id": 212, "label": "Value", "start_offset": 7263, "end_offset": 7266, "text": "12%", "global_span": [ 7797, 7800 ] }, { "id": 213, "label": "Traditional", "start_offset": 7267, "end_offset": 7271, "text": "year", "global_span": [ 7801, 7805 ] }, { "id": 214, "label": "Traditional", "start_offset": 7274, "end_offset": 7276, "text": "on", "global_span": [ 7808, 7810 ] }, { "id": 215, "label": "Traditional", "start_offset": 7279, "end_offset": 7283, "text": "year", "global_span": [ 7813, 7817 ] }, { "id": 216, "label": "Traditional", "start_offset": 7427, "end_offset": 7440, "text": "average loans", "global_span": [ 7961, 7974 ] }, { "id": 217, "label": "Value", "start_offset": 7449, "end_offset": 7451, "text": "2%", "global_span": [ 7983, 7985 ] }, { "id": 218, "label": "Traditional", "start_offset": 7452, "end_offset": 7456, "text": "year", "global_span": [ 7986, 7990 ] }, { "id": 219, "label": "Traditional", "start_offset": 7459, "end_offset": 7461, "text": "on", "global_span": [ 7993, 7995 ] }, { "id": 220, "label": "Traditional", "start_offset": 7464, "end_offset": 7468, "text": "year", "global_span": [ 7998, 8002 ] }, { "id": 221, "label": "Traditional", "start_offset": 7948, "end_offset": 7971, "text": "Average client deposits", "global_span": [ 8482, 8505 ] }, { "id": 222, "label": "Value", "start_offset": 7980, "end_offset": 7982, "text": "2%", "global_span": [ 8514, 8516 ] }, { "id": 223, "label": "Traditional", "start_offset": 7983, "end_offset": 7987, "text": "year", "global_span": [ 8517, 8521 ] }, { "id": 224, "label": "Traditional", "start_offset": 7990, "end_offset": 7992, "text": "on", "global_span": [ 8524, 8526 ] }, { "id": 225, "label": "Traditional", "start_offset": 7995, "end_offset": 7999, "text": "year", "global_span": [ 8529, 8533 ] }, { "id": 226, "label": "Traditional", "start_offset": 8043, "end_offset": 8055, "text": "credit costs", "global_span": [ 8577, 8589 ] }, { "id": 227, "label": "Value", "start_offset": 8061, "end_offset": 8073, "text": "$384 million", "global_span": [ 8595, 8607 ] }, { "id": 228, "label": "Traditional", "start_offset": 8079, "end_offset": 8096, "text": "net reserve build", "global_span": [ 8613, 8630 ] }, { "id": 229, "label": "Value", "start_offset": 8100, "end_offset": 8112, "text": "$220 million", "global_span": [ 8634, 8646 ] }, { "id": 230, "label": "Traditional", "start_offset": 8213, "end_offset": 8223, "text": "Net charge", "global_span": [ 8747, 8757 ] }, { "id": 231, "label": "Value", "start_offset": 8236, "end_offset": 8248, "text": "$164 million", "global_span": [ 8770, 8782 ] }, { "id": 232, "label": "Traditional", "start_offset": 8344, "end_offset": 8391, "text": "Asset and wealth management reported net income", "global_span": [ 8878, 8925 ] }, { "id": 233, "label": "Value", "start_offset": 8395, "end_offset": 8407, "text": "$1.3 billion", "global_span": [ 8929, 8941 ] }, { "id": 234, "label": "Traditional", "start_offset": 8413, "end_offset": 8416, "text": "pre", "global_span": [ 8947, 8950 ] }, { "id": 235, "label": "Traditional", "start_offset": 8419, "end_offset": 8429, "text": "tax margin", "global_span": [ 8953, 8963 ] }, { "id": 236, "label": "Value", "start_offset": 8433, "end_offset": 8436, "text": "32%", "global_span": [ 8967, 8970 ] }, { "id": 237, "label": "Traditional", "start_offset": 8438, "end_offset": 8445, "text": "Revenue", "global_span": [ 8972, 8979 ] }, { "id": 238, "label": "Value", "start_offset": 8449, "end_offset": 8461, "text": "$5.3 billion", "global_span": [ 8983, 8995 ] }, { "id": 239, "label": "Value", "start_offset": 8469, "end_offset": 8471, "text": "6%", "global_span": [ 9003, 9005 ] }, { "id": 240, "label": "Traditional", "start_offset": 8472, "end_offset": 8476, "text": "year", "global_span": [ 9006, 9010 ] }, { "id": 241, "label": "Traditional", "start_offset": 8479, "end_offset": 8481, "text": "on", "global_span": [ 9013, 9015 ] }, { "id": 242, "label": "Traditional", "start_offset": 8484, "end_offset": 8488, "text": "year", "global_span": [ 9018, 9022 ] }, { "id": 243, "label": "Traditional", "start_offset": 8666, "end_offset": 8674, "text": "Expenses", "global_span": [ 9200, 9208 ] }, { "id": 244, "label": "Value", "start_offset": 8678, "end_offset": 8690, "text": "$3.5 billion", "global_span": [ 9212, 9224 ] }, { "id": 245, "label": "Value", "start_offset": 8699, "end_offset": 8702, "text": "12%", "global_span": [ 9233, 9236 ] }, { "id": 246, "label": "Traditional", "start_offset": 8703, "end_offset": 8707, "text": "year", "global_span": [ 9237, 9241 ] }, { "id": 247, "label": "Traditional", "start_offset": 8710, "end_offset": 8712, "text": "on", "global_span": [ 9244, 9246 ] }, { "id": 248, "label": "Traditional", "start_offset": 8715, "end_offset": 8719, "text": "year", "global_span": [ 9249, 9253 ] }, { "id": 249, "label": "Traditional", "start_offset": 8890, "end_offset": 8901, "text": "net inflows", "global_span": [ 9424, 9435 ] }, { "id": 250, "label": "Value", "start_offset": 8907, "end_offset": 8918, "text": "$52 billion", "global_span": [ 9441, 9452 ] }, { "id": 251, "label": "Traditional", "start_offset": 8979, "end_offset": 8990, "text": "net inflows", "global_span": [ 9513, 9524 ] }, { "id": 252, "label": "Value", "start_offset": 8994, "end_offset": 9005, "text": "$16 billion", "global_span": [ 9528, 9539 ] }, { "id": 253, "label": "Traditional", "start_offset": 9007, "end_offset": 9010, "text": "AUM", "global_span": [ 9541, 9544 ] }, { "id": 254, "label": "Value", "start_offset": 9014, "end_offset": 9027, "text": "$3.7 trillion", "global_span": [ 9548, 9561 ] }, { "id": 255, "label": "Value", "start_offset": 9035, "end_offset": 9038, "text": "15%", "global_span": [ 9569, 9572 ] }, { "id": 256, "label": "Traditional", "start_offset": 9039, "end_offset": 9043, "text": "year", "global_span": [ 9573, 9577 ] }, { "id": 257, "label": "Traditional", "start_offset": 9046, "end_offset": 9048, "text": "on", "global_span": [ 9580, 9582 ] }, { "id": 258, "label": "Traditional", "start_offset": 9051, "end_offset": 9055, "text": "year", "global_span": [ 9585, 9589 ] }, { "id": 259, "label": "Traditional", "start_offset": 9061, "end_offset": 9074, "text": "client assets", "global_span": [ 9595, 9608 ] }, { "id": 260, "label": "Value", "start_offset": 9078, "end_offset": 9091, "text": "$5.4 trillion", "global_span": [ 9612, 9625 ] }, { "id": 261, "label": "Value", "start_offset": 9100, "end_offset": 9103, "text": "18%", "global_span": [ 9634, 9637 ] }, { "id": 262, "label": "Traditional", "start_offset": 9104, "end_offset": 9108, "text": "year", "global_span": [ 9638, 9642 ] }, { "id": 263, "label": "Traditional", "start_offset": 9111, "end_offset": 9113, "text": "on", "global_span": [ 9645, 9647 ] }, { "id": 264, "label": "Traditional", "start_offset": 9116, "end_offset": 9120, "text": "year", "global_span": [ 9650, 9654 ] }, { "id": 265, "label": "Traditional", "start_offset": 9283, "end_offset": 9292, "text": "Corporate", "global_span": [ 9817, 9826 ] }, { "id": 266, "label": "Traditional", "start_offset": 9302, "end_offset": 9312, "text": "net income", "global_span": [ 9836, 9846 ] }, { "id": 267, "label": "Value", "start_offset": 9316, "end_offset": 9328, "text": "$6.8 billion", "global_span": [ 9850, 9862 ] }, { "id": 268, "label": "Traditional", "start_offset": 9332, "end_offset": 9339, "text": "revenue", "global_span": [ 9866, 9873 ] }, { "id": 269, "label": "Value", "start_offset": 9343, "end_offset": 9356, "text": "$10.1 billion", "global_span": [ 9877, 9890 ] }, { "id": 270, "label": "Traditional", "start_offset": 9468, "end_offset": 9471, "text": "NIR", "global_span": [ 10002, 10005 ] }, { "id": 271, "label": "Traditional", "start_offset": 9476, "end_offset": 9478, "text": "up", "global_span": [ 10010, 10012 ] }, { "id": 272, "label": "Value", "start_offset": 9493, "end_offset": 9505, "text": "$450 million", "global_span": [ 10027, 10039 ] }, { "id": 273, "label": "Traditional", "start_offset": 9506, "end_offset": 9510, "text": "year", "global_span": [ 10040, 10044 ] }, { "id": 274, "label": "Traditional", "start_offset": 9513, "end_offset": 9515, "text": "on", "global_span": [ 10047, 10049 ] }, { "id": 275, "label": "Traditional", "start_offset": 9524, "end_offset": 9527, "text": "NII", "global_span": [ 10058, 10061 ] }, { "id": 276, "label": "Traditional", "start_offset": 9532, "end_offset": 9534, "text": "up", "global_span": [ 10066, 10068 ] }, { "id": 277, "label": "Value", "start_offset": 9535, "end_offset": 9547, "text": "$626 million", "global_span": [ 10069, 10081 ] }, { "id": 278, "label": "Traditional", "start_offset": 9548, "end_offset": 9552, "text": "year", "global_span": [ 10082, 10086 ] }, { "id": 279, "label": "Traditional", "start_offset": 9555, "end_offset": 9557, "text": "on", "global_span": [ 10089, 10091 ] }, { "id": 280, "label": "Traditional", "start_offset": 9560, "end_offset": 9564, "text": "year", "global_span": [ 10094, 10098 ] }, { "id": 281, "label": "Traditional", "start_offset": 9626, "end_offset": 9634, "text": "Expenses", "global_span": [ 10160, 10168 ] }, { "id": 282, "label": "Value", "start_offset": 9638, "end_offset": 9650, "text": "$1.6 billion", "global_span": [ 10172, 10184 ] }, { "id": 283, "label": "Value", "start_offset": 9659, "end_offset": 9671, "text": "$427 million", "global_span": [ 10193, 10205 ] }, { "id": 284, "label": "Traditional", "start_offset": 9672, "end_offset": 9676, "text": "year", "global_span": [ 10206, 10210 ] }, { "id": 285, "label": "Traditional", "start_offset": 9679, "end_offset": 9681, "text": "on", "global_span": [ 10213, 10215 ] }, { "id": 286, "label": "Traditional", "start_offset": 9684, "end_offset": 9688, "text": "year", "global_span": [ 10218, 10222 ] }, { "id": 287, "label": "Traditional", "start_offset": 9724, "end_offset": 9732, "text": "expenses", "global_span": [ 10258, 10266 ] }, { "id": 288, "label": "Traditional", "start_offset": 9738, "end_offset": 9742, "text": "down", "global_span": [ 10272, 10276 ] }, { "id": 289, "label": "Value", "start_offset": 9743, "end_offset": 9755, "text": "$573 million", "global_span": [ 10277, 10289 ] }, { "id": 290, "label": "Traditional", "start_offset": 9756, "end_offset": 9760, "text": "year", "global_span": [ 10290, 10294 ] }, { "id": 291, "label": "Traditional", "start_offset": 9763, "end_offset": 9765, "text": "on", "global_span": [ 10297, 10299 ] }, { "id": 292, "label": "Traditional", "start_offset": 9768, "end_offset": 9772, "text": "year", "global_span": [ 10302, 10306 ] }, { "id": 293, "label": "Traditional", "start_offset": 10042, "end_offset": 10045, "text": "NII", "global_span": [ 10576, 10579 ] }, { "id": 294, "label": "Traditional", "start_offset": 10050, "end_offset": 10056, "text": "NII ex", "global_span": [ 10584, 10590 ] }, { "id": 295, "label": "Traditional", "start_offset": 10059, "end_offset": 10066, "text": "markets", "global_span": [ 10593, 10600 ] }, { "id": 296, "label": "Value", "start_offset": 10084, "end_offset": 10095, "text": "$91 billion", "global_span": [ 10618, 10629 ] }, { "id": 297, "label": "Traditional", "start_offset": 10097, "end_offset": 10113, "text": "adjusted expense", "global_span": [ 10631, 10647 ] }, { "id": 298, "label": "Value", "start_offset": 10123, "end_offset": 10134, "text": "$92 billion", "global_span": [ 10657, 10668 ] }, { "id": 299, "label": "Traditional", "start_offset": 10143, "end_offset": 10149, "text": "credit", "global_span": [ 10677, 10683 ] }, { "id": 300, "label": "Traditional", "start_offset": 10151, "end_offset": 10166, "text": "Card net charge", "global_span": [ 10685, 10700 ] }, { "id": 301, "label": "Value", "start_offset": 10195, "end_offset": 10199, "text": "3.4%", "global_span": [ 10729, 10733 ] }, { "id": 336, "label": "Traditional", "text": "net income", "start_offset": 445, "end_offset": 455, "global_span": [ 979, 989 ] }, { "id": 337, "label": "Traditional", "text": "Excluding both the Visa gain that I mentioned earlier, as well as last year 's First Republic bargain", "start_offset": 1618, "end_offset": 1719, "global_span": [ 2152, 2253 ] }, { "id": 338, "label": "Traditional", "text": "up ", "start_offset": 2163, "end_offset": 2166, "global_span": [ 2697, 2700 ] }, { "id": 339, "label": "Traditional", "text": "Excluding the items I just mentioned", "start_offset": 2118, "end_offset": 2154, "global_span": [ 2652, 2688 ] }, { "id": 340, "label": "Traditional", "text": "up ", "start_offset": 2346, "end_offset": 2349, "global_span": [ 2880, 2883 ] }, { "id": 341, "label": "Traditional", "text": "up ", "start_offset": 2418, "end_offset": 2421, "global_span": [ 2952, 2955 ] }, { "id": 342, "label": "Traditional", "text": "net charge - offs", "start_offset": 2684, "end_offset": 2701, "global_span": [ 3218, 3235 ] }, { "id": 343, "label": "Traditional", "text": "up", "start_offset": 3023, "end_offset": 3025, "global_span": [ 3557, 3559 ] }, { "id": 344, "label": "Traditional", "text": "CCB ", "start_offset": 3773, "end_offset": 3777, "global_span": [ 4307, 4311 ] }, { "id": 345, "label": "Traditional", "text": "up", "start_offset": 3852, "end_offset": 3854, "global_span": [ 4386, 4388 ] }, { "id": 346, "label": "Traditional", "text": "down ", "start_offset": 4086, "end_offset": 4091, "global_span": [ 4620, 4625 ] }, { "id": 347, "label": "Traditional", "text": "down", "start_offset": 4708, "end_offset": 4712, "global_span": [ 5242, 5246 ] }, { "id": 348, "label": "Traditional", "text": "up ", "start_offset": 4841, "end_offset": 4844, "global_span": [ 5375, 5378 ] }, { "id": 349, "label": "Traditional", "text": "net charge - offs", "start_offset": 5149, "end_offset": 5166, "global_span": [ 5683, 5700 ] }, { "id": 350, "label": "Traditional", "text": "up ", "start_offset": 5183, "end_offset": 5186, "global_span": [ 5717, 5720 ] }, { "id": 351, "label": "Traditional", "text": " net reserve build", "start_offset": 5311, "end_offset": 5329, "global_span": [ 5845, 5863 ] }, { "id": 352, "label": "Traditional", "text": "revenue ", "start_offset": 5566, "end_offset": 5574, "global_span": [ 6100, 6108 ] }, { "id": 353, "label": "Traditional", "text": "advisory, fees ", "start_offset": 5963, "end_offset": 5978, "global_span": [ 6497, 6512 ] }, { "id": 354, "label": "Traditional", "text": "equity up", "start_offset": 6118, "end_offset": 6127, "global_span": [ 6652, 6661 ] }, { "id": 355, "label": "Traditional", "text": "debt up", "start_offset": 6136, "end_offset": 6143, "global_span": [ 6670, 6677 ] }, { "id": 356, "label": "Traditional", "text": "up", "start_offset": 6787, "end_offset": 6789, "global_span": [ 7321, 7323 ] } ], "relations": [ { "id": 1, "entity_ids": [ 0, 1 ], "description": "Value_of" }, { "id": 2, "entity_ids": [ 2, 3 ], "description": "Value_of" }, { "id": 3, "entity_ids": [ 4, 5 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 6, 7 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 8, 9, 10 ], "description": "Value_of" }, { "id": 6, "entity_ids": [ 11, 12, 13 ], "description": "Value_of" }, { "id": 7, "entity_ids": [ 14, 15 ], "description": "Value_of" }, { "id": 8, "entity_ids": [ 16, 336 ], "description": "Value_of" }, { "id": 9, "entity_ids": [ 17, 18 ], "description": "Value_of" }, { "id": 10, "entity_ids": [ 19, 20 ], "description": "Value_of" }, { "id": 11, "entity_ids": [ 21, 22, 23, 24, 25 ], "description": "Value_of" }, { "id": 12, "entity_ids": [ 26, 27, 28, 29 ], "description": "Value_of" }, { "id": 13, "entity_ids": [ 30, 31, 32, 33, 34, 35 ], "description": "Value_of" }, { "id": 14, "entity_ids": [ 36, 37 ], "description": "Value_of" }, { "id": 15, "entity_ids": [ 36, 38, 39 ], "description": "Value_of" }, { "id": 16, "entity_ids": [ 36, 38, 40, 41, 42, 43 ], "description": "Value_of" }, { "id": 17, "entity_ids": [ 44, 45 ], "description": "Value_of" }, { "id": 18, "entity_ids": [ 46, 47, 48, 337 ], "description": "Value_of" }, { "id": 19, "entity_ids": [ 46, 49, 50, 337 ], "description": "Value_of" }, { "id": 20, "entity_ids": [ 46, 49, 51, 337 ], "description": "Value_of" }, { "id": 21, "entity_ids": [ 52, 53 ], "description": "Value_of" }, { "id": 22, "entity_ids": [ 52, 54 ], "description": "Value_of" }, { "id": 23, "entity_ids": [ 55, 56, 57 ], "description": "Value_of" }, { "id": 24, "entity_ids": [ 55, 56, 58 ], "description": "Value_of" }, { "id": 25, "entity_ids": [ 55, 56, 59, 337, 338 ], "description": "Value_of" }, { "id": 26, "entity_ids": [ 55, 56, 60, 337, 338, 339 ], "description": "Value_of" }, { "id": 27, "entity_ids": [ 61, 62, 340 ], "description": "Value_of" }, { "id": 28, "entity_ids": [ 61, 63, 64, 65, 66, 340 ], "description": "Value_of" }, { "id": 29, "entity_ids": [ 67, 68 ], "description": "Value_of" }, { "id": 30, "entity_ids": [ 67, 69, 341 ], "description": "Value_of" }, { "id": 31, "entity_ids": [ 67, 70, 71, 72, 73, 341 ], "description": "Value_of" }, { "id": 32, "entity_ids": [ 74, 75, 76 ], "description": "Value_of" }, { "id": 33, "entity_ids": [ 77, 78 ], "description": "Value_of" }, { "id": 34, "entity_ids": [ 80, 81 ], "description": "Value_of" }, { "id": 35, "entity_ids": [ 82, 83, 84, 85, 86, 87 ], "description": "Value_of" }, { "id": 36, "entity_ids": [ 80, 81 ], "description": "Value_of" }, { "id": 37, "entity_ids": [ 77, 79, 342 ], "description": "Value_of" }, { "id": 38, "entity_ids": [ 88, 89, 90 ], "description": "Value_of" }, { "id": 39, "entity_ids": [ 88, 91, 92 ], "description": "Value_of" }, { "id": 40, "entity_ids": [ 93, 94 ], "description": "Value_of" }, { "id": 41, "entity_ids": [ 93, 95, 343 ], "description": "Value_of" }, { "id": 42, "entity_ids": [ 96, 97 ], "description": "Value_of" }, { "id": 43, "entity_ids": [ 99, 101, 102 ], "description": "Value_of" }, { "id": 44, "entity_ids": [ 103, 104, 344 ], "description": "Value_of" }, { "id": 45, "entity_ids": [ 105, 106, 344 ], "description": "Value_of" }, { "id": 46, "entity_ids": [ 105, 107, 108, 109, 110, 344, 345 ], "description": "Value_of" }, { "id": 47, "entity_ids": [ 111, 112, 113, 114, 115, 116, 117 ], "description": "Value_of" }, { "id": 48, "entity_ids": [ 118, 119, 120, 121, 122 ], "description": "Value_of" }, { "id": 49, "entity_ids": [ 118, 123, 124, 125, 126, 346 ], "description": "Value_of" }, { "id": 50, "entity_ids": [ 127, 128, 129, 130, 131, 132 ], "description": "Value_of" }, { "id": 51, "entity_ids": [ 133, 134, 135 ], "description": "Value_of" }, { "id": 52, "entity_ids": [ 133, 134, 136, 137, 138, 139 ], "description": "Value_of" }, { "id": 53, "entity_ids": [ 140, 141, 142, 143, 144, 145 ], "description": "Value_of" }, { "id": 54, "entity_ids": [ 146, 147 ], "description": "Value_of" }, { "id": 55, "entity_ids": [ 148, 149, 150 ], "description": "Value_of" }, { "id": 56, "entity_ids": [ 148, 149, 151, 347 ], "description": "Value_of" }, { "id": 57, "entity_ids": [ 148, 152, 153 ], "description": "Value_of" }, { "id": 58, "entity_ids": [ 148, 152, 154, 155, 156, 157, 348 ], "description": "Value_of" }, { "id": 59, "entity_ids": [ 158, 159 ], "description": "Value_of" }, { "id": 60, "entity_ids": [ 158, 160, 349 ], "description": "Value_of" }, { "id": 61, "entity_ids": [ 158, 161, 162, 163, 164, 350 ], "description": "Value_of" }, { "id": 62, "entity_ids": [ 165, 351 ], "description": "Value_of" }, { "id": 63, "entity_ids": [ 166, 167, 168, 169 ], "description": "Value_of" }, { "id": 64, "entity_ids": [ 166, 167, 170, 352 ], "description": "Value_of" }, { "id": 65, "entity_ids": [ 171, 172, 173, 174, 175, 176 ], "description": "Value_of" }, { "id": 66, "entity_ids": [ 177, 178, 179, 180, 181, 182 ], "description": "Value_of" }, { "id": 67, "entity_ids": [ 183, 353 ], "description": "Value_of" }, { "id": 68, "entity_ids": [ 184, 185, 354 ], "description": "Value_of" }, { "id": 69, "entity_ids": [ 186, 355 ], "description": "Value_of" }, { "id": 70, "entity_ids": [ 187, 188 ], "description": "Value_of" }, { "id": 71, "entity_ids": [ 187, 189, 190, 191, 192 ], "description": "Value_of" }, { "id": 72, "entity_ids": [ 193, 194, 195 ], "description": "Value_of" }, { "id": 73, "entity_ids": [ 193, 194, 196, 197, 198, 199, 356 ], "description": "Value_of" }, { "id": 74, "entity_ids": [ 200, 201 ], "description": "Value_of" }, { "id": 75, "entity_ids": [ 202, 203 ], "description": "Value_of" }, { "id": 76, "entity_ids": [ 204, 205 ], "description": "Value_of" }, { "id": 77, "entity_ids": [ 204, 206 ], "description": "Value_of" }, { "id": 78, "entity_ids": [ 204, 206, 207, 208, 209 ], "description": "Value_of" }, { "id": 79, "entity_ids": [ 210, 211 ], "description": "Value_of" }, { "id": 80, "entity_ids": [ 210, 212, 213, 214, 215 ], "description": "Value_of" }, { "id": 81, "entity_ids": [ 216, 217, 218, 219, 220 ], "description": "Value_of" }, { "id": 82, "entity_ids": [ 221, 222, 223, 224, 225 ], "description": "Value_of" }, { "id": 83, "entity_ids": [ 226, 227 ], "description": "Value_of" }, { "id": 84, "entity_ids": [ 228, 229 ], "description": "Value_of" }, { "id": 85, "entity_ids": [ 230, 231 ], "description": "Value_of" }, { "id": 86, "entity_ids": [ 232, 233 ], "description": "Value_of" }, { "id": 87, "entity_ids": [ 232, 234, 235, 236 ], "description": "Value_of" }, { "id": 88, "entity_ids": [ 232, 237, 238 ], "description": "Value_of" }, { "id": 89, "entity_ids": [ 237, 239, 240, 241, 242 ], "description": "Value_of" }, { "id": 90, "entity_ids": [ 243, 244 ], "description": "Value_of" }, { "id": 91, "entity_ids": [ 243, 245, 246, 247, 248 ], "description": "Value_of" }, { "id": 92, "entity_ids": [ 249, 250 ], "description": "Value_of" }, { "id": 93, "entity_ids": [ 251, 252 ], "description": "Value_of" }, { "id": 94, "entity_ids": [ 253, 254 ], "description": "Value_of" }, { "id": 95, "entity_ids": [ 253, 255, 256, 257, 258 ], "description": "Value_of" }, { "id": 96, "entity_ids": [ 259, 260 ], "description": "Value_of" }, { "id": 97, "entity_ids": [ 259, 261, 262, 263, 264 ], "description": "Value_of" }, { "id": 98, "entity_ids": [ 265, 266, 267 ], "description": "Value_of" }, { "id": 99, "entity_ids": [ 268, 269 ], "description": "Value_of" }, { "id": 100, "entity_ids": [ 270, 271, 272, 273, 274 ], "description": "Value_of" }, { "id": 101, "entity_ids": [ 265, 275, 276, 277 ], "description": "Value_of" }, { "id": 102, "entity_ids": [ 265, 275, 276, 277, 278, 279, 280 ], "description": "Value_of" }, { "id": 103, "entity_ids": [ 281, 282 ], "description": "Value_ofValue_of" }, { "id": 104, "entity_ids": [ 281, 282 ], "description": "Value_of" }, { "id": 105, "entity_ids": [ 281, 283, 284, 285, 286 ], "description": "Value_of" }, { "id": 106, "entity_ids": [ 287, 288, 289, 290, 291, 292 ], "description": "Value_of" }, { "id": 107, "entity_ids": [ 293, 294, 295, 296, 297 ], "description": "Value_of" }, { "id": 108, "entity_ids": [ 297, 298 ], "description": "Value_of" }, { "id": 109, "entity_ids": [ 299, 300, 301 ], "description": "Value_of" } ] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Operator: For our first question, we 'll go to the line of Steven Chubak from Wolfe Research. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Steven Chubak: Hi. Good morning, Jeremy.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Good morning Steve.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Steven Chubak: So, I wanted to start off with a question on capital. Just given some indications that the Fed is considering favorable revisions to both Basel III endgame and the GSIB surcharge calculations, which I know you ' ve been pushing for some time. As you evaluate just different capital scenarios, are these revisions material enough where they could support a higher normalized ROTCE at the Firm versus a 17% target? And if so, just how that might impact or inform your appetite for buybacks going forward?", "ground_truth_output": { "entities": [ { "id": 302, "label": "Traditional", "start_offset": 379, "end_offset": 395, "text": "normalized ROTCE", "global_span": [ 11668, 11684 ] }, { "id": 303, "label": "Value", "start_offset": 417, "end_offset": 420, "text": "17%", "global_span": [ 11706, 11709 ] }, { "id": 304, "label": "Traditional", "start_offset": 421, "end_offset": 427, "text": "target", "global_span": [ 11710, 11716 ] } ], "relations": [ { "id": 110, "entity_ids": [ 302, 303, 304 ], "description": "Value_of" } ] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Right, okay. Thanks Steve. And actually before answering the question, I just want to remind everyone that Jamie is not able to join because he has a travel conflict overseas, so it 's just going to be me today. Okay. Good question on the capital and the ROTCE. So let me start with the ROTCE point first. In short, my answer to that question would be no. It 's hard to imagine a scenario coming out of the whole potential range of outcomes on capital that involves an upward revision on ROTCE. If you think about the way we ' ve been talking about this, we ' ve said that you know before the Basel III endgame proposal, we had a 17% through cycle target and that while you can imagine a range of different outcomes, the vast majority of them involve expansions of the denominator. And while we had ideas about changing the perimeter and repricing, all of which are still sort of in effect, most of those would be thought of as mitigants rather than things that would actually increase the ROTCE. And I do n't really think that answer has particularly changed. So as of now, that 's what I would say, which is a good pivot to the next point, which is yeah, we ' ve been reading the same press coverage you ' ve been reading and you know, it 's fun and interesting to speculate about the potential outcomes here, but in reality, we do n't know anything -- you do n't know. We do n't know how reliable the press coverage is. And so in that sense, I feel like on the overall capital return and buyback trajectory, not much has actually changed relative to what I laid out at Investor Day, the comments that I made then, the comments that Jamie made then, as well as the comments that Jamie made subsequent week at an industry conference. So maybe I 'll just briefly summarize for everyone 's benefit what we think that is, which is one, we do recognize that our current practice on capital return and buybacks does lead to an ever - expanding CET1 ratio. But obviously we 're going to run the company over the cycle over time at a reasonable CET1 ratio with reasonable buffers relative to our requirements. So after all the uncertainty is sorted out, the question of the deployment of the Capital one way or another is a matter of when, not if. On the capital hierarchy, it 's also worth noting that 's another thing that remains unchanged, so I 'll review it quickly. You know, growing the business organically and inorganically, sustainable dividend, and in that context it 's worth noting that the Board 's announced intention to increase it to a $1.25 is a 19% increase prior to last year, so that 's a testament for our performance and that is a return of capital. And then finally buyback, but that hierarchy does not commit us to return 100% of the capital generation in any given quarter. And so, as we said here today, when you look at the relationship between the opportunity cost of not deploying the capital and the opportunities to deploy the capital outside the Firm, it is kind of hard to imagine an environment where that relationship argues more strongly for patients. So given all that, putting it all together I ' m sorry for the long answer, we remain comfortable with the current amount of excess capital. And as Jamie has said, we really continue to think about it as earnings in store, as much as anything else.", "ground_truth_output": { "entities": [ { "id": 305, "label": "Traditional", "start_offset": 2444, "end_offset": 2464, "text": "sustainable dividend", "global_span": [ 14251, 14271 ] }, { "id": 306, "label": "Traditional", "start_offset": 2533, "end_offset": 2542, "text": "intention", "global_span": [ 14340, 14349 ] }, { "id": 307, "label": "Traditional", "start_offset": 2546, "end_offset": 2554, "text": "increase", "global_span": [ 14353, 14361 ] }, { "id": 308, "label": "Value", "start_offset": 2563, "end_offset": 2568, "text": "$1.25", "global_span": [ 14370, 14375 ] }, { "id": 309, "label": "Value", "start_offset": 2574, "end_offset": 2577, "text": "19%", "global_span": [ 14381, 14384 ] }, { "id": 310, "label": "Traditional", "start_offset": 2578, "end_offset": 2586, "text": "increase", "global_span": [ 14385, 14393 ] }, { "id": 311, "label": "Traditional", "start_offset": 2596, "end_offset": 2605, "text": "last year", "global_span": [ 14403, 14412 ] } ], "relations": [ { "id": 111, "entity_ids": [ 305, 306, 307, 308 ], "description": "Value_of" }, { "id": 112, "entity_ids": [ 305, 306, 309, 310, 311 ], "description": "Value_of" } ] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Steven Chubak: No need to apologize, Jeremy. That was a really helpful perspective. Maybe just for my follow - up on NII. You ' ve been very consistent just in flagging the risk related to NII over earning, especially in light of potential deposit attrition, as well as repricing headwinds. In the second quarter, we did see at least some moderation in repricing pressures. Deposit balances were also more resilient in what 's a seasonally weak quarter for deposit growth. So just given the evidence that some deposit pressures appear to be abating. Do you see the potential for NII normalizing higher? And where do you think that level could ultimately be in terms of stabilization?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. Interesting question, Steve. So let 's talk about deposit balances. So yes I see your point about how balance pressures are slightly abating. When you look at the system as a whole, just to go through it, Q2 is still a bit of a headwind. Loan growth is modest and not enough to offset that. And RRP seems to have settled in roughly at its current levels, and there are reasons to believe that it might not go down that much more, although that could always change and that could supply extra reserves into the system. But on balance, net across all those various effects, we still think that there are net headwinds to deposit balances. So when we think of our balance outlook, we see it as flat to slightly down maybe, with our sort of market share and growth ambitions offsetting those system - wide headwinds. So in terms of normalizing higher, I guess it depends on relative to what. But I think it is definitely too early to be sort of calling the end of the over earning narrative or the normalization narrative. Clearly, the main difference in our current guidance relative to what we had earlier in the year, which implied a lot more sequential decline, is just the change in the Fed outlook. So two cuts versus six cuts is the main difference there. But obviously, based on the latest completion data and so on, you could usually get back to a situation with a lot more cuts in the yield curve. So we 'll see how it goes. And in the end, we are kind of focused on just running the place, recognizing and trying not to be distracted by what remains some amount of over earning, whatever it is.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Steven Chubak: Understood, Jeremy. Thanks so much for taking my questions.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks Steve.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Operator: Next, we 'll go to the line of Saul Martinez from HSBC. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Saul Martinez: Hi, good morning. Thanks for taking my question. Jeremy, can you give an update on the stress capital buffer? You noted, obviously, that you think there is an error in the Fed ’s calculation due to OCI. Can you just give us a sense of what the dialogue with the Fed looks like? Is there a process to modify the SCB higher? And if you could give us a sense of what that process looks like.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. So I ' m not going to comment about any conversations with the Fed. Not to confirm or deny that they even exist, that stuff is private. And so -- and then if you talk about like the timing here, right? So you know that the stress capital buffer that 's been released 3.3%, is a preliminary number. By rule, the Fed has to release that by August 31, it may come sooner. You talked about an error in the calculation, we have n't used that word. What we know -- what we believe, rather, is that the amount of OCI gain that came through the Fed ’s disclosed results looked non - intuitively high to us. And if you adjust that in ways that we think are reasonable, you would get a slightly higher stress capital buffer. Whether the Fed agrees and whether they decide to make that change or not is up to them, and we 'll see what happens. I think the larger point is that if you look at the industry as a whole and if you sort of put us into that with some higher pro forma SCB, whatever it might conceivably be, you actually see once again, quite a bit of volatility in the year - on - year change in the stress capital buffer for many firms. And just sort of reiterating and -- another example of what we ' ve said a lot over the years, that it 's volatile, it 's untransparent, it makes it very hard to manage capital of a bank. It leads to excessively high management buffers, and we think it 's really not a great way to do things. So I 'll leave it at that.", "ground_truth_output": { "entities": [ { "id": 312, "label": "Traditional", "start_offset": 244, "end_offset": 265, "text": "stress capital buffer", "global_span": [ 18295, 18316 ] }, { "id": 313, "label": "Value", "start_offset": 288, "end_offset": 292, "text": "3.3%", "global_span": [ 18339, 18343 ] }, { "id": 314, "label": "Traditional", "start_offset": 299, "end_offset": 310, "text": "preliminary", "global_span": [ 18350, 18361 ] } ], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Saul Martinez: Okay. Got it. That 's helpful. Just following up on capital returns on Steve 's question. I think you highlighted in response as a matter of when not if. And obviously, Jamie is not there. You ca n't speak for Jamie. But seems to have shown limited enthusiasm for a special dividend or buybacks at current valuations. Can you just give us a sense of how you 're thinking about the various options? Any updated thoughts on your special dividend? And can you do other things like for example, have a material increase in your dividend payout sort of a step function increase, where -- keep that flat and grow into that grow your earnings into that over time? Can you just maybe give us a sense of how you 're thinking about what options you have available to deploy that capital.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. I mean I would direct you to read -- actually, I have Jamie 's comments at the industry conference where you participated the week after Investor Day, because he wanted just a good amount of detail on this stuff addressing some of these points. And I think his comment there about the special dividend was that it 's not really a preference. We hear from people that many of our investors would n't find that particularly appealing, and he said as much that it would n't be sort of our first choice. So I think the larger point is just that -- a little bit to your question, there are a number of tools in the toolkit, and they 're really the same tools that are part of our capital hierarchy. So first and foremost, we 're looking to deploy the capital into organic or inorganic growth. And then the dividend, I think, we are always going to want to keep it in that like sustainable, and also sustainable in a stress environment. So that continues to be the way we think about that. And then at the end of it, it is buybacks. And Jamie has been on the record for over a decade, I think over many shareholder letters, talking about how he thinks about price and buybacks and valuation, and price is a factor. So that 's sort of the totality of the sort of options, I guess.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Saul Martinez: Okay, great. Thanks a lot.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks Saul.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Operator: Next, we 'll go to the line of Ken Usdin from Jefferies. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Ken Usdin: Thanks a lot. Good morning Jeremy. Jeremy, great to see the progress on investment banking fees, up sequentially and 50% year - over - year. And I saw you on the tape earlier just talking about still regulatory concerns a little bit in the advisory space. And we clearly did n't see the debt pull - forward play through, because DCM was great again. I ' m just wondering just where you feel the environment is relative to the potential. And just where the dialogue is across the three main bucket areas in terms of like how does this feel in terms of current environment versus a potential environment that we could still see ahead? Thanks.", "ground_truth_output": { "entities": [ { "id": 315, "label": "Traditional", "start_offset": 84, "end_offset": 107, "text": "investment banking fees", "global_span": [ 21854, 21877 ] }, { "id": 316, "label": "Traditional", "start_offset": 109, "end_offset": 124, "text": "up sequentially", "global_span": [ 21879, 21894 ] }, { "id": 317, "label": "Value", "start_offset": 129, "end_offset": 132, "text": "50%", "global_span": [ 21899, 21902 ] }, { "id": 318, "label": "Traditional", "start_offset": 133, "end_offset": 151, "text": "year - over - year", "global_span": [ 21903, 21921 ] } ], "relations": [ { "id": 113, "entity_ids": [ 315, 316, 317, 318 ], "description": "Value_of" } ] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. Thanks, Ken. It 's progress, right? I mean we are happy to see the progress. People have been talking about [depressed ] (ph) banking fee wallet for some time, and it 's nice to see not only the year - on - year pop on the low base, but also a nice sequential improvement. So that 's the first thing to say. In terms of dialogue and engagement, it 's definitely elevated. So as the dialogue on ECM is elevated and the dialogue on M&A is quite robust as well. So all of those are good things that encourage us and make us hopeful that we could be seeing sort of a better trend in this space. But there are some important caveats. So on the DCM side, yes, we made pull - forward comments in the first quarter, but we still feel that this second quarter still reflects a bunch of pull forward, and therefore we are reasonably cautious about the second half of the year. Importantly, a lot of the activity is refinancing activity as opposed to for example, acquisition finance. So the fact that M&A remains still relatively muted in terms of actual deals has knock - on effects on DCM as well. And when a higher percentage of the wallet is refi, then the pull - forward risk becomes a little bit higher. On ECM, if you look at it kind of at [remove ] (ph), you might ask the question, given the performance of the overall indices, you would think it would be a really booming environment for IPOs, for example. And while it 's improving, it 's not quite as good as you would otherwise expect. And that 's driven by a variety of factors, including the fact that as has been widely discussed, that extent to which the performance of the large industries is driven by like a few stocks, the sort of mid - cap tech growth space and other spaces that would typically be driving IPOs have had much more muted performance. Also, a lot of the private capital that was raised a couple of years ago was raised at pretty high valuations. And so in some cases, people looking at IPOs could be looking at down rounds, that 's an issue. And while secondary market performance of IPOs has improved meaningfully, in some cases, people still have concerns about that. So those are a little bit of overhang on that space. I think we can hope that, over time that fades away and the trend gets a bit more robust. And yes, on the advisory side, the regulatory overhang is there, remains there. And so we 'll just have to see how that plays out.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Ken Usdin: Great. Thank you for all that Jeremy. And just one on the consumer side. Just anything you 're noticing in terms of people who just have been waiting for this delinquency stabilization on the credit card side. Obviously, your loss rates are coming in as you expected, and we did see 30 days pretty flat and 90 days come down a little bit. Any -- is that seasonal? Is it just a good rate of change trend? Any thoughts there? Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. I still feel like when it comes to Card charge - offs and delinquencies, there 's just not much to see there. It 's still -- it 's normalization, not deterioration. It 's in - line with expectations. As I say, we always look quite closely inside the cohort, inside the income cohorts. And when you look in there, specifically, for example on spend patterns, you can see a little bit of evidence of behavior that 's consistent with a little bit of weakness in the lower income segments, where you see a little bit of rotation of the spend out of discretionary into non - discretionary. But the effects are really quite subtle, and in my mind definitely entirely consistent with the type of economic environment that we are seeing, which, while very strong and certainly a lot stronger than anyone would have thought given the tightness of monetary conditions, say, like they ' ve been predicting it a couple of years ago or whatever, you are seeing slightly higher unemployment, you are seeing moderating GDP growth. And so it is not entirely surprising that you 're seeing a tiny bit of weakness in some pockets of spend. So it all kind of hangs together in what is sometimes actually not a very interesting story.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Ken Usdin: Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks Ken.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Operator: Next, we 'll go to the line of Glenn Schorr from Evercore ISI. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Glenn Schorr: Hi, thanks very much. So Jeremy, the discussions so far around private credit and you all, your recent comments have been the ability to add on balance sheet and compete when you need to compete on the private credit front. I do think that most of the discussion has been about the direct - lending component. So I ' m curious if you are showing more progress and activity on that front. And then very importantly, do you see the same trend happening on the asset - backed finance side, because that 's a bigger part of the world, and it is a bigger part of your business? So I 'd appreciate your thoughts there. Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 27, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. Thanks, Glenn. So on private credit, so nothing really new to say there. I think -- I guess one way the environment is evolving a little bit is that as you know, a lot of money has been raised in private credit funds looking for deals. And sort of a little bit to my prior comment, in a relatively muted acquisition finance environment, at this point you ' ve got a lot of money chasing kind of like not that many deals. So the space is a little bit quieter than it was at the margin. Another interesting thing to note is some of this discussion about kind of lender protections that were typical in the syndicated lender finance market making their way into the private market as well, is sort of people realize that even in the private market, you probably need some of those protections in some cases. Which is sort of supportive of the theme that we ' ve been talking about, about convergence between the direct lending space and the syndicated lending space, which is kind of our core thesis here, which is that we can offer best - in - class service across the entire continuum, including secondary market trading and so on. So we feel optimistic about our offering there. I think the current environment is maybe a little bit quieter than it was. So it is maybe not a great moment to like kind of test whether we are doing a lot more or less in the space, so to speak. And then on asset - backed financing, you actually asked me that question before. And at the time, my answer was that I have n't heard much about that trend, and that continues to be the case. But clearly, there must be something I ' m missing. So I can follow up on that and maybe we can have a chat about it.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 28, "sub_chunk_id": 0, "sentences": "Glenn Schorr: That 's great for you if you are not hearing much about it, so we can leave it at that. Maybe just one quick follow - up in terms of your just overall posturing on -- you were patient and smart when rates were low, waited to deploy, worked out great. We know that story. Now it seems like you have tons of excess liquidity and you are being patient and rates are high. And I ' m curious on how you think about what kind of triggers, what kind of things you 're looking for in the market to know if and when you would extend duration?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 29, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Right. I mean on duration, in truth we have actually added a little bit of duration over the last couple of quarters. So that 's one thing to say, that was more last quarter than this quarter. But I guess I would just caution you from -- a little bit away from looking at kind of our reported cash balances and our balance sheet, and concluding that when you look at the duration concept holistically, that there is a lot to be done differently on the duration front. So clearly, it is true that empirically, we ' ve behaved like very asset sensitively in this rate hiking cycle, and that has resulted in a lot of excess NII generation sort of on the way up in the near - term. But when we look at the fund 's overall sensitivity to rates, we look at it through both like the [EAR type lens ] (ph), the short - term NIR sensitivity, but also a variety of other lenses, including various types of scenario analysis, including impacts on capital from higher rates. And as I think Jamie has said a couple of times, we actually aim to be relatively balanced on that front. Also, given like the inverted yield curve, it 's not as if extending duration from these levels means that you 're walking in 5.5% rate. In fact, the forwards are not sort of that compelling given our views about some sort of structural upward pressures on inflation and so on. So I think when you put that all together, I do n't think that kind of a big change in duration posture is a thing that 's front in mind for us.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 30, "sub_chunk_id": 0, "sentences": "Glenn Schorr: Super, helpful. Thanks so much for that.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 31, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks Glenn.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 32, "sub_chunk_id": 0, "sentences": "Operator: Next, we 'll go to the line of Matt O'Connor from Deutsche Bank. Please go ahead.\n Matt O'Connor: Good morning. I was just wondering if you can elaborate on essentially the math behind the ROTCE being too high at 20% and normalized at 17%. Obviously, you ' ve pointed to over-[earning NII ] (ph). And I guess the question is, is that all of it to go from 20% to 17%? And if so, is that all consumer deposit costs? Or are there a few other components that you could help frame for us?", "ground_truth_output": { "entities": [ { "id": 319, "label": "Traditional", "start_offset": 199, "end_offset": 204, "text": "ROTCE", "global_span": [ 31360, 31365 ] }, { "id": 320, "label": "Value", "start_offset": 223, "end_offset": 226, "text": "20%", "global_span": [ 31384, 31387 ] }, { "id": 321, "label": "Traditional", "start_offset": 231, "end_offset": 241, "text": "normalized", "global_span": [ 31392, 31402 ] }, { "id": 322, "label": "Value", "start_offset": 245, "end_offset": 248, "text": "17%", "global_span": [ 31406, 31409 ] }, { "id": 323, "label": "Value", "start_offset": 365, "end_offset": 368, "text": "20%", "global_span": [ 31526, 31529 ] }, { "id": 324, "label": "Value", "start_offset": 372, "end_offset": 375, "text": "17%", "global_span": [ 31533, 31536 ] }, { "id": 357, "label": "Traditional", "text": "over-[earning NII ]", "start_offset": 281, "end_offset": 300, "global_span": [ 31442, 31461 ] } ], "relations": [ { "id": 114, "entity_ids": [ 319, 320 ], "description": "Value_of" }, { "id": 115, "entity_ids": [ 319, 321, 322 ], "description": "Value_of" }, { "id": 116, "entity_ids": [ 323, 324, 357 ], "description": "Value_of" } ] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 33, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Sure. Good question, Matt. I mean, I guess the way I think about it is a couple of things. Like our returns tend to be a bit seasonal, right? So if you kind of build yourself out a full year forecast and make reasonable space on your own, or analyst consensus or whatever, and you think about the fourth quarter, better look at this on a full year basis when you think about the returns than the quarterly numbers, and you obviously have to strip out kind of the onetime items. And so if you do that, like whatever you get for this year is still clearly a number that 's higher than 17%. So yes, one source of headwinds is normalization of the NII, primarily as a result of the expected higher deposit costs. That 's -- we 've talked about that. Part of it is also the yield curve effects. Some cuts will come into the curve at some point. And in the normal course, if you kind of do a very, very, very supplemental model of the company, you would have like expenses grow -- revenue is growing at some organic GDP like rate, maybe higher, and expenses growing at a similar slightly lower rate, producing a sort of relatively stable overhead ratio. But even if the amount of NII normalization winds up being less than we might have thought at some prior point, you still have some background -- you still have some normalization of the overhead ratio that needs to happen. So as much as our discipline on expense management is, as tight as it always has been, the inflation is still non - zero. There are still investments that we 're executing. There is still higher expense to come in a slightly flatter revenue environment as a result of in part, the normalization of NII. And then the final point is that whatever winds up being the answer on Basel III endgame and all the other pieces, you have to assume some amount of expansion of the denominator, at least based on what we know so far. So of course, any of those pieces could be wrong, but that 's kind of how we get to our 17%. And if you look at the various scenarios that we showed on the last page of my Investor Day presentation, it illustrates those dynamics and also how much the range could actually vary as a function of the economic environment and other factors.\n Matt O'Connor: Yes. That was a really helpful chart. Just one follow - up. On the yield curve effects, I guess, what do you mean by that? Because right now, the yield curve is inverted, maybe you 're still leaving any impact of that. But kind of longer - term, you 'd expect a little bit of steepness of the curve, which I would think would help. But what does you mean by that? Thank you.", "ground_truth_output": { "entities": [ { "id": 325, "label": "Value", "start_offset": 599, "end_offset": 602, "text": "17%", "global_span": [ 32253, 32256 ] }, { "id": 326, "label": "Value", "start_offset": 1997, "end_offset": 2000, "text": "17%", "global_span": [ 33651, 33654 ] } ], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 34, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. I mean you and I talked about this before. I guess I sort of -- I guess I do n't really agree fundamentally with the notion that the way to think about things is that sort of yield curve steepness above and beyond what 's priced in by the forwards is a source of structural NII or NIM for banks, if you know what I mean. Like I mean people have different views about the so - called term premium. And obviously, in a moment of inverted curve and different types of treasury supply dynamics, people thinking on that may be changing. But I think we saw, when rates were at Zero and the 10 - year note was below 2%, everyone sort of -- many people were kind of tempted to try to get extra NIM and extra NII by extending duration a lot. But when the steepness of the curve implies -- is driven by the expectation of actually aggressive Fed tightening, it 's just a timing issue and you can wind up kind of pretty offside from the capital and other perspectives. So there are some interesting questions about whether fiscal dynamics might result in a structurally steeper yield curve down the road and whether that could be sort of -- earning the term premium, so to speak, could be a source of NII, but that feels a bit speculative to me at this point.\n Matt O'Connor: Got it. Okay, thank you for the details.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 35, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks Matt.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 36, "sub_chunk_id": 0, "sentences": "Operator: Next, we 'll go to the line of Mike Mayo from Wells Fargo Securities. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 37, "sub_chunk_id": 0, "sentences": "Mike Mayo: Hi. Jeremy, you said it 's too early to end the over earning narrative, and you highlighted higher deposit costs and the impact of lower rates and lower NII and DCM pull - forward and credit cost going higher. Anything I 'm missing on that list? And what would cause you to end the over earning narrative?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 38, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: No. Actually, I think that is the right list Mike. I mean, frankly, I think one thing that would end to be over earning narrative is if our annual returns were closer to 17%. I mean to the extent that, that is the through - the - cycle number that we believe and that we are currently producing more than that, that 's one very simple way to look at that. But the pieces of that or the pieces that you talked about and the single most important piece is the deposit margin. Our deposit margins are well above historical norms, and that is a big part of the reason that we still are emphasizing the over earning narrative.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 39, "sub_chunk_id": 0, "sentences": "Mike Mayo: You 're 17% through - the - cycle ROTCE kind of expectation, what is the CET1 ratio that you assumed for that?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 40, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: I mean we would generally assume requirements plus a reasonable buffer, which depending on the shape of rules, could be a little bit smaller or a little bit bigger. And the small part as a function of the volatility of those pools, which goes back to my prior comments on SCB and CCAR. But obviously, as you well know, what actually matters is less the ratio and more of the dollars. And at this point, the dollars are very much a function of where rules land and where the RWA lands, and obviously things like GSIB recalibration and so on. So we ' ve done a bunch of scenario analysis along the lines of what I did at Investor Day that informs those numbers, but that is obviously one big element of uncertainty behind that 17%. Which is why at Investor Day, when we talked about it, both Daniel and I were quite specific about saying that we thought 17% was still achievable, assuming a reasonable outcome on the Basel III endgame.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 41, "sub_chunk_id": 0, "sentences": "Mike Mayo: Let me just zoom out for one more question on the return target. I mean when I asked Jamie at the [2013 ] (ph) Investor Day would it make sense to have 13.5% capital, he was basically telling you take a hike, right? And now you have 15.3% capital and you 're saying, well, we might want to have a lot more capital here. I mean at some point, if you 're spending $17 billion a year to improve the company, if you 're gaining share with digital banking, if you 're automating the back office, if you 're moving ahead with AI, if you 're doing all these things that I think you say others are n't doing, why would n't those returns go higher over time? Or do you just assume you 'll be competing those benefits away? Thanks.", "ground_truth_output": { "entities": [ { "id": 327, "label": "Value", "start_offset": 245, "end_offset": 250, "text": "15.3%", "global_span": [ 38010, 38015 ] }, { "id": 328, "label": "Traditional", "start_offset": 251, "end_offset": 258, "text": "capital", "global_span": [ 38016, 38023 ] } ], "relations": [ { "id": 117, "entity_ids": [ 327, 328 ], "description": "Value_of" } ] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 42, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. I mean, I think in short, Mike, and we ' ve talked about this a lot and Jamie has talked about this a lot, it is a very, very, very competitive market. And we are very happy with our performance. We are very happy with the share we ' ve taken. And 17% is like an amazing number actually. And like to be able to do that, given how robust the competition is from banks, from non - banks, from US banks, from foreign banks and all of the different businesses that we compete in, is something that we 're really proud of. So the number has a range around it, obviously. So it 's not a promise, it 's not a guarantee and it can fluctuate. But we are very proud to be in the ballpark of being able to think that we can deliver it, again assuming a reasonable outcome on Basel III endgame. But it 's a very, very, very competitive market across all of our products and services and regions and [line ] (ph) segments.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 43, "sub_chunk_id": 0, "sentences": "Mike Mayo: All right. Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 44, "sub_chunk_id": 0, "sentences": "Operator: Next, we 'll go to the line of Betsy Graseck from Morgan Stanley. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 45, "sub_chunk_id": 0, "sentences": "Betsy Graseck: Hi, Jeremy.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 46, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Hi, Betsy.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 47, "sub_chunk_id": 0, "sentences": "Betsy Graseck: So I did want to ask one drill - down question on 2Q, and it is related to the dollar amount of buybacks that you did do. I think in the press release, right and the slide deck, it 's $4.9 billion common stock net repurchases. So the question here is what 's the governor for you on how much to do every quarter? And I mean I understand it is a function of okay, how much do we organically grow. But even with that, so you get the organic growth which you had some nice movement there. But you do the organic growth and then is it how much do we earn and we want to buy back our earnings? Or how should we be thinking about what that repurchase volume should be looking like over time? And I remember at Investor Day, the whole debate around I do n't want to buy back my stock, but we are right? So I get this question from investors quite a bit of how should we be thinking about how you think about what the right amount is to be doing here?", "ground_truth_output": { "entities": [ { "id": 329, "label": "Value", "start_offset": 201, "end_offset": 212, "text": "4.9 billion", "global_span": [ 39808, 39819 ] }, { "id": 330, "label": "Traditional", "start_offset": 213, "end_offset": 241, "text": "common stock net repurchases", "global_span": [ 39820, 39848 ] } ], "relations": [ { "id": 118, "entity_ids": [ 329, 330 ], "description": "Value_of" } ] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 48, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. That 's a very good and fair question, Betsy. So let me try to unpack it to the best of my abilities. So -- in no particular order. One thing that we ' ve really tried to emphasize in a number of different settings, including in our recent 10 - Qs actually, is that we do n't want to get into the business of guiding on buybacks. So we 're going to buy back whatever we think makes sense in the current moment sort of -- and we prefer the right to sort of change that at any time. So I recognize that not everyone loves that, but that is kind of a philosophical belief. And so I might as well say it explicitly. It was pretty clear in the [Q ] (ph) also, but I ' m just going to say that again. So that 's point one. But having said that, let me nonetheless try to address your point on framework and governors. So generally speaking, we think it does n't make sense to sort of exit the market entirely unless the conditions are much more unusual than they are right now, let 's say. Obviously, when for whatever reason, if we ever need to build capital in a hurry, we ' ve done it before and we are always comfortable suspending buybacks entirely. But I think some modest amount of buybacks, is a reasonable thing to do when you are generating your kind of capital. And so we were talking before about this $2 billion pace, we 're kind of trying to move away from this notion of a pace, but that 's where that idea comes from, let 's put it that way. You talked about the $4.9 million, which I recognize may seem like a little bit of a random number. But where that actually comes from is the other statement that we made, that we have these significant item gains from Visa. And if you think about what that means, it means that we have, post the acceptance of the exchange offer, a meaningful long position and liquid large cap financial stock, i.e. Visa, which realistically is highly correlated to our own stock. And so in some sense, why carry that instead of just buying back JPMorgan stock. So we talked about, Jamie talked about as we liquidate the Visa, deploying those proceeds into JPM, and that 's what we did this quarter. So that is why the 4.9% is a little higher. And it 's consistent with my comments at our Investor Day around having slightly increased the amount of buybacks. And beyond that what you are left with is answer to Steve 's question, which is that, to your point about buying back earnings or whatever, when we are generating these types of earnings and there is this much organic capital being generated, in the absence of opportunities to deploy it organically or inorganically and while continuing to maintain our healthy but sustainable dividend, if we do n't return the capital, we are going to keep growing the CET1 ratio, the levels of which -- if you think about the long strategic outlook of the company, are not reasonable. They 're just artificially high and unnecessary. So one way or the other, that will need to be addressed at some point. It 's just that we do n't feel now is the right time.", "ground_truth_output": { "entities": [ { "id": 331, "label": "Value", "start_offset": 1329, "end_offset": 1339, "text": "$2 billion", "global_span": [ 41895, 41905 ] }, { "id": 332, "label": "Value", "start_offset": 1494, "end_offset": 1506, "text": "$4.9 million", "global_span": [ 42060, 42072 ] } ], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 49, "sub_chunk_id": 0, "sentences": "Betsy Graseck: Great. Thank you Jeremy. Appreciate it.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 50, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks Betsy.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 51, "sub_chunk_id": 0, "sentences": "Operator: Next, we 'll go to the line of Gerard Cassidy from RBC Capital Markets. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 52, "sub_chunk_id": 0, "sentences": "Gerard Cassidy: Hi, Jeremy, how are you?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 53, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Hi, Gerard.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 54, "sub_chunk_id": 0, "sentences": "Gerard Cassidy: Jeremy, can you -- I know you touched on deposits earlier in the call in response to a question. I noticed on the average balances, the non - interest bearing deposits were relatively stable quarter - to - quarter versus prior quarters when they have steadily declined. And this is one of the areas, of course investors are focused on in terms of the future of the net interest margin for you and your peers. Can you elaborate, if you can, what you 're seeing in that non - interest - bearing deposit account? I know this is average and not period end, the period end number may actually be lower. But what are you guys seeing here?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 55, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. Good question, Gerard. I have to be honest, I have n't focused on that particular sequential explain i.e., quarter - on - quarter change and average non - interest - bearing deposits. But I think the more important question is the big picture question, which is what do we expect? I mean how are we thinking about ongoing migration of non - interest - bearing into interest - bearing in the current environment, and how that affects our NII outlook and our expectation for weighted average rate paid on deposits. And the answer to that question is that we do continue to expect that migration to happen. So if you think about it in the wholesale space, you have a bunch of clients with some balances in non - interest - bearing accounts, and over time for a variety of reasons, we do see them moving those balances into interest - bearing. So we do continue to expect that migration to happen, and therefore, that will be a source of headwinds. And that migration sometimes happens internally, i.e., out of non - interest - bearing into interest - bearing or into CDs. Sometimes it goes into money markets or into investments, which is what we see happening in our Wealth Management business. And some of it does leave the company. But one of the things that we are encouraged by is the extent to which we are actually capturing a large portion of that yield - seeking flow through CDs and money market offerings, et cetera, across our various franchises. So big picture. I do think that migration out of non - interest - bearing into interest - bearing will continue to be a thing, and that is a contributor to the modest headwinds that we expect for NII right now. But yes I 'll leave it at that, I guess.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 56, "sub_chunk_id": 0, "sentences": "Gerard Cassidy: Very good. And as a follow - up, you ' ve been very clear about the consumer credit card charge - offs and delinquency levels. And we all know about the commercial real estate office, and you always talk about over - earning on net interest income of course. One of the great credit quality stories for everyone, including yourselves, is the C&I portfolio, how strong it 's been for -- in this elevated rate environment. And I know your numbers are still quite low, but in the Corporate and Investment Bank, you had about a $500 million pickup in non - accrual loans. Can you share with us what are you seeing in C&I? Are there any signs of cracks or anything? And again, I know your numbers are still good, but I ' m just trying to look forward to see if there 's something here over the next 12 months or so.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 57, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes, it 's a good question. I think the short answer is no, we are not really seeing early signs of cracks in C&I. I mean, yes, I agree with you, like the C&I charge - off rate has been very, very low for a long time. I think we emphasized that at last year 's Investor Day, if I remember correctly. I think the C&I charge - off rate we are seeing 10 years was something like literally zero. So that is clearly very low by historical standards. And while we take a lot of pride in that number, I think it reflects the discipline in our underwriting process and the strength of our credit culture across bankers and the risk team, that 's not -- we do n't actually run that franchise to like a zero loss expectation. So you have to assume there will be some upward pressure on that. But in any given quarter, the C&I numbers tend to be quite lumpy and quite idiosyncratic. So I do n't think, that anything in the current quarter results is indicative of anything broader, and I have n't heard anyone internally talk that way, I would say.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 58, "sub_chunk_id": 0, "sentences": "Gerard Cassidy: Great, appreciate the insights as always. Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 59, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks Gerard.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 60, "sub_chunk_id": 0, "sentences": "Operator: Next, we 'll go to the line of Erika Najarian from UBS. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 61, "sub_chunk_id": 0, "sentences": "Erika Najarian: Hi, good morning. I just had one cleanup question, Jeremy. The consensus provision for 2024 is $10.7 billion. Could you maybe clarify for once and for all sort of Jamie 's comments at an industry conference earlier and try to sort of triangulate if that $10.7 billion provision is appropriate for the growth level that you are planning for in Card?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 62, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Yes. Happy to clarify that. So Jamie 's comments were that the allowance to build and the Card allowance, so we are talking about Card specifically, we expected something like $2 billion for the full year. As I sit here today, our expectation for that number is actually slightly higher, but it is in the ballpark. And I think in terms of what that means for the consensus on the overall allowance change for the year, last time I checked, it still looked a little low on that front. So who knows what it will actually wind up being, but that remains our view. One question that we ' ve gotten is how to reconcile that build to the 12% growth in OS that we ' ve talked about because it seems like a little bit high relative to what you would have otherwise assumed if you apply some sort of a standard coverage ratio to that growth. But the reason that 's the case is essentially a combination of higher revolving mix as we continue to see some normalization revolve in that 12%, as well as seasoning of earlier vintages, which comes with slightly higher allowance per unit of OS growth.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 63, "sub_chunk_id": 0, "sentences": "Erika Najarian: Great. Thank you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 64, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks Erika.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 65, "sub_chunk_id": 0, "sentences": "Operator: And for our final question, we 'll go to the line of Jim Mitchell from Seaport Global Securities. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 66, "sub_chunk_id": 0, "sentences": "Jim Mitchell: Hi, good morning. Maybe just one last question on sort of deploying excess capital. It seems like the two primary ways to do that organically would be through the trading book or the loan book. So maybe two questions there. One, trading assets were up 20% year - over - year. Is that you leaning into it or just a function of demand? And is there further opportunities to grow that? And then secondly outside of Cards, loan demand has been quite weak. And any thoughts from you on if you 're seeing any change in demand or how you 're thinking about loan demand going forward? Thanks.", "ground_truth_output": { "entities": [ { "id": 333, "label": "Traditional", "start_offset": 244, "end_offset": 258, "text": "trading assets", "global_span": [ 50220, 50234 ] }, { "id": 334, "label": "Value", "start_offset": 264, "end_offset": 270, "text": "up 20%", "global_span": [ 50240, 50246 ] }, { "id": 335, "label": "Traditional", "start_offset": 271, "end_offset": 289, "text": "year - over - year", "global_span": [ 50247, 50265 ] } ], "relations": [ { "id": 119, "entity_ids": [ 333, 334, 335 ], "description": "Value_of" } ] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 67, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks, Jim. Good question. So yes, trading assets have been up. That is basically client activity primarily secured financing related sort of matchbook repo type stuff and similar things that are -- grows up the balance sheet quite a bit, but are quite low risk and therefore quite low RWA intensity. So while our ability the supply that financing to clients is something that we 're happy about and it 's very much represents us leaning into the franchise to serve our clients. It 's not really particularly RWA, and therefore capital intensive, and therefore it does n't really reflect an aggressive choice on our part to deploy capital, so to speak. On the loan demand front, yes, I mean, unfortunately, I just do n't have much new to say there on loan demand. Meaning, to your point, loan demand remains quite muted everywhere except Card. Our Card business is, of course, in no way capital constrained. So whatever growth makes sense there in terms of our customer franchise and our ability to acquire accounts and retain accounts, and what fits inside our credit risk appetite is growth that 's going to make sense. And so we 're very happy to deploy capital to that. But it 's not constrained by our willingness or ability to deploy capital to that. And of course, for the rest of the loan space, the last thing that we are going to do is have the excess capital mean that we lean in to lending that is not inside our risk appetite or inside our credit box, especially in a world where spreads are quite compressed and terms are under pressure. So there is always a balance between capital deployment and assessing economic risk rationally. And frankly, that is in some sense, a microcosm of the larger challenge that we have right now. When I talked about if there was ever a moment where the opportunity cost of not deploying the capital relative to how attractive the opportunities outside the walls of the company are, now would be it in terms of being patient. That 's a little bit one example of what I was referring to.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 68, "sub_chunk_id": 0, "sentences": "Jim Mitchell: All right. Okay, great. Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 69, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Thanks Jim.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 70, "sub_chunk_id": 0, "sentences": "Operator: And we have no further questions.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 71, "sub_chunk_id": 0, "sentences": "Jeremy Barnum: Very good. Thank you, everyone. See you next quarter.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "JPM", "quarter": 2, "year": 2024, "date": "2024-07-12 08:30:00", "chunk_id": 72, "sub_chunk_id": 0, "sentences": "Operator: Thank you all for participating in today 's conference. You may disconnect your line and enjoy the rest of your day.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 0, "sub_chunk_id": 0, "sentences": "Operator: Greetings and welcome to the Prologis Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen - only mode. A question - and - answer session will follow the formal presentation. [Operator Instructions ] Please note that this conference is being recorded. I will now turn the conference over to our host, Jill Sawyer, Vice President of Investor Relations. Thank you. You may begin.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 1, "sub_chunk_id": 0, "sentences": "Jill Sawyer: Thanks you, Adel. Good morning, everyone. Welcome to our second quarter 2023 earnings conference call. The supplemental document is available on our website at prologis.com under Investor Relations. I 'd like to state that this conference call will contain forward - looking statements under federal securities laws. These statements are based on current expectations, estimates and projections about the market and the industry in which Prologis operates, as well as management 's beliefs and assumptions. Forward - looking statements are not guarantees of performance and actual operating results may be affected by a variety of factors. For a list of those factors, please refer to the forward - looking statement notice in our 10 - K or other SEC filings. Additionally, our second quarter results, press release and supplemental do contain financial measures such as FFO and EBITDA that are non - GAAP measures and in accordance with Reg G, we have provided a reconciliation to those measures. I 'd like to welcome Tim Arndt, our CFO, who will cover results, real - time market conditions and guidance; Hamid Moghadam, our CEO and our entire executive team are also with us today. With that I ’ll hand the call over to Tim.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 2, "sub_chunk_id": 0, "sentences": "Tim Arndt: Thanks, Jill. Good morning, everybody, and welcome to our second quarter earnings call. We had a very good quarter with outstanding results across our uniquely diversified business. It was highlighted by record rent change, a ramp up in development starts roughly half of which were build - to - suit and the acquisition of over $3 billion of real estate at accretive returns deepening our scale in key markets. We also earned record strategic capital income and raised $1.2 billion in new equity across the vehicles. We are watching markets closely and we ’ ve been clear that we expect vacancies to arise over the course of the year from a normalization of demand and elevated development deliveries. We ’ ve indeed seen vacancy build and expected to reach the mid - fours in the US by year end but continue to believe that fundamentals will regain momentum in 2024 with the outlook for new supply declining as development starts continue to fall this year. In short, our outlook is completely unchanged and we feel great about our business. Turning to our results, core FFO excluding promotes was $1.25 per share and including promotes was $1.83 per share, both ahead of our forecast. Our promote income was generated from both USLF and FIBRA Prologis and meaningfully exceeded our guidance. USLF generated promote revenue at Prologis share of over $635 million. In its three year performance period, assets grew by over $10 billion and the fund delivered an IRR of over 20% net of all fees and with very low leverage. In terms of our operating results, average occupancy for the quarter was 97.5%, down 50 basis points from the first quarter and in line with our expectations. Rent change on starts was a record on both a net effective and cash basis, 79% and 48% respectively. Net effective rent change on signings of more forward - looking build was an impressive 87% with notable rent change from Phoenix at a 137%, Northern New Jersey at 150% and Southern California at a 181%. Global markets also contributed to strong signings with Mexico at 34%, the UK at 36%, Central Europe at 51%, and Canada at a 150%. Bottom - line rent change has been both robust and broad based. Market rents continued to grow albeit at a slower pace increasing a little over 1.5% in the quarter. In - place rents grew by approximately 2.5% over the quarter, the net of which translates to a lease mark - to - market of 66%, down from 68%. We explained last quarter that our lease mark - to - market would generate $2.85 per share of incremental earnings as leases roll over time without any additional market rent growth. Interestingly, that future upside is virtually unchanged at June 30th, even though we crystallized rental increases over the quarter. This is because a lower lease market - to - market is now being applied to a larger base of in - place NOI. Ultimately, same - store growth is our most important operating metric and this quarter remained exceptional at 8.9% on a net effective basis and 10.7% on cash. I 'd like to highlight that even with $4 billion of investment during the quarter, the balance sheet remains in impeccable shape, with liquidity of approximately $6.4 billion and debt - to - EBITDA of 4.2x. We raised approximately $7 billion in debt financing across four currencies at an interest rate of 4.9% and an average term of eight years. Turning to our markets, the trend to normalization, which we ' ve been speaking to for some time continues. Proposal activity, gestation and pre - leasing of vacancy are all within a few percent of their pre - COVID levels, a period which we ’ ve highlighted many times was itself historically strong. Our IDI sentiment index ticked in the quarter to over 58 indicating a continued strong backdrop for demand as described by our customers and further supported by utilization increasing to 85.5%. Unsurprisingly, customers have been more deliberate in their decision - making amidst the uptick in vacancy. We continue to believe that this will be a short - lived reprieve as construction starts have indeed declined significantly for our expectations. Starts in the second quarter were down approximately 40% across our US markets and 50% in Europe. We see deliveries in 2024 falling short of demand, reducing vacancy over the course of next year. Significant attention has been given to Southern California in recent months, while our portfolio is over 97% leased and we are achieving record rent change, vacancy has grown partially due to port operations that have not yet returned to normal. Additionally, some customers are re - evaluating expansion in the Inland Empire diversifying operations to other Southwest markets. With all this in mind, we ' ve reduced our rent growth forecast for Southern California in 2023. However given what is still low vacancy together with structural headwinds to new supply and a huge consumption base, we believe strongly in this market. The global nature of our portfolio means that we will see markets contribute to growth in different periods evening out peaks and troughs. We see this playing out in a number of markets across the globe, where our rent growth forecast is increasing this quarter such as Las Vegas, Texas, Europe and Mexico to name a few. All this together with the more than 5% rent growth to - date has us re - forecasting the full year to a range of 7% to 9% on a global basis. What matters more than what will transpire in the next six months is what we see over the medium term, which is growth that will be fueled by escalating replacement costs, growing barriers to new supply and ongoing secular drivers of demand. Late in the second quarter we announced and closed on the acquisition of over 14 million square foot portfolio in many of our best US markets. We estimate an 8% unlevered IRR simply at the property level, exclusive of additional return driven by property management synergies, essentials opportunities, including solar and the upside we expect through revenue management. While this was the largest transaction in the quarter, overall activity increased slightly bringing additional price discovery to the market. In Europe values have been relatively stable, experiencing a 1% decline over the second quarter. Latin America saw an increase in values with write - ups in Brazil and Mexico of 2% and 5% respectively and write - downs in the US were in line with expectations approximately 5% driving the cumulative decline over the last year to 12%. With this move, we view the values as fair and are proceeding on redemption in USLF for the third quarter. New redemption requests in the quarter totaled approximately $800 million and was concentrated in USLF and our China venture where values have held up better. Together with other activity the net redemption queue stands at approximately $1.6 billion. Outside of open - ended funds, the company raised an incremental $1.2 billion comprised of $500 million in the FIBRA and NPR, as well as a new $700 million commitment for a complementary vehicle in Japan, PJLF, which is detailed in our supplemental. Before turning to guidance, I 'd like to mention a few updates across our Essentials business. We added 45 megawatts of new solar production and storage in the first half of the year, bringing our platform total to 450 megawatts, nearly 50% of the way to our 1 gigawatt goal for 2025. Additionally, Prologis Mobility, our EV business has more than 65 lead charging sites in the pipeline across the US and Europe. In terms of our outlook for the balance of the year, we are guiding average occupancy to range between 97% and 97.5%. We are increasing our same - store guidance eight three quarters to nine and a quarter percent on a net effective basis and 9.5% to 10% on a cash basis. Net effective rent change propelling same stores will continue to accelerate in the next two quarters and average approximately 80% over the year. We are maintaining our G&A guidance to range between $380 million and $390 million and are increasing our strategic capital revenue guidance excluding promotes to range between $520 million and $530 million. As a result of the outperformance in USLF ’s promotes, we are increasing our forecast for net promote income to $475 million. Year - to - date, we are in excess of this amount, but the amortization expense will continue over the back half of the year. Development starts picked up during the quarter with commencements of 12 projects around the globe and while we remained very selective on new spec starts, we are maintaining our guidance to $2.5 billion to $3 billion for the year. We had over $550 million in contribution in disposition activity during the quarter concentrated in Japan and Mexico and are maintaining guidance of $2 billion to $3 billion. Putting it all together, we are increasing guidance for GAAP earnings to range between $3.30 and $3.40 per share. We are increasing core FFO including promotes guidance to a range of $5.56 to $5.60 per share and increasing core FFO executing promotes to range between $5.06 and $5.10 per share with the midpoint representing over 10% annual growth marking our fourth consecutive year of double - digit earnings growth. The quarter highlighted many ways that Prologis has diversified itself across geographies, business lines and capital sources, while rents in some markets decelerate, others with different demand drivers are now accelerating. We 're seeing the same balance with property values as demonstrated over the quarter. Further, we generate incremental cash flows and value creation outside of the pure rent business in closely related and synergistic platforms, namely Strategic Capital development and now Essentials. Our fundraising efforts also demonstrate the value of having alternatives. Clearly, our wide access to debt capital has been a tremendous advantage, but we also benefit from access to varied equity sources for our ventures by utilizing open end vehicles, JVs and public structures, we have the ability to be opportunistic and proactive in changing capital markets. As we close, I 'd like to remind you of two upcoming events of Prologis later in the year. Our Groundbreakers Thought Leadership Forum on September 27th, right here in San Francisco, and our Investor Forum on December 13th in New York. Additional information for each is available on our website. With that, I will hand it back to the operator for your questions.", "ground_truth_output": { "entities": [ { "id": 0, "label": "Traditional", "start_offset": 323, "end_offset": 334, "text": "acquisition", "global_span": [ 1992, 2003 ] }, { "id": 1, "label": "Value", "start_offset": 343, "end_offset": 353, "text": "$3 billion", "global_span": [ 2012, 2022 ] }, { "id": 2, "label": "Traditional", "start_offset": 357, "end_offset": 368, "text": "real estate", "global_span": [ 2026, 2037 ] }, { "id": 3, "label": "Traditional", "start_offset": 372, "end_offset": 389, "text": "accretive returns", "global_span": [ 2041, 2058 ] }, { "id": 4, "label": "Traditional", "start_offset": 443, "end_offset": 474, "text": "record strategic capital income", "global_span": [ 2112, 2143 ] }, { "id": 5, "label": "Value", "start_offset": 479, "end_offset": 498, "text": "raised $1.2 billion", "global_span": [ 2148, 2167 ] }, { "id": 6, "label": "Traditional", "start_offset": 1088, "end_offset": 1115, "text": "core FFO excluding promotes", "global_span": [ 2757, 2784 ] }, { "id": 7, "label": "Value", "start_offset": 1120, "end_offset": 1135, "text": "$1.25 per share", "global_span": [ 2789, 2804 ] }, { "id": 8, "label": "Traditional", "start_offset": 1140, "end_offset": 1158, "text": "including promotes", "global_span": [ 2809, 2827 ] }, { "id": 9, "label": "Value", "start_offset": 1163, "end_offset": 1178, "text": "$1.83 per share", "global_span": [ 2832, 2847 ] }, { "id": 10, "label": "Value", "start_offset": 1185, "end_offset": 1190, "text": "ahead", "global_span": [ 2854, 2859 ] }, { "id": 11, "label": "Traditional", "start_offset": 1191, "end_offset": 1206, "text": "of our forecast", "global_span": [ 2860, 2875 ] }, { "id": 12, "label": "Traditional", "start_offset": 1317, "end_offset": 1347, "text": "USLF generated promote revenue", "global_span": [ 2986, 3016 ] }, { "id": 13, "label": "Traditional", "start_offset": 1351, "end_offset": 1365, "text": "Prologis share", "global_span": [ 3020, 3034 ] }, { "id": 14, "label": "Value", "start_offset": 1369, "end_offset": 1386, "text": "over $635 million", "global_span": [ 3038, 3055 ] }, { "id": 15, "label": "Traditional", "start_offset": 1426, "end_offset": 1437, "text": "assets grew", "global_span": [ 3095, 3106 ] }, { "id": 16, "label": "Value", "start_offset": 1441, "end_offset": 1457, "text": "over $10 billion", "global_span": [ 3110, 3126 ] }, { "id": 17, "label": "Traditional", "start_offset": 1484, "end_offset": 1487, "text": "IRR", "global_span": [ 3153, 3156 ] }, { "id": 18, "label": "Value", "start_offset": 1491, "end_offset": 1499, "text": "over 20%", "global_span": [ 3160, 3168 ] }, { "id": 19, "label": "Traditional", "start_offset": 1500, "end_offset": 1503, "text": "net", "global_span": [ 3169, 3172 ] }, { "id": 20, "label": "Traditional", "start_offset": 1507, "end_offset": 1515, "text": "all fees", "global_span": [ 3176, 3184 ] }, { "id": 21, "label": "Traditional", "start_offset": 1562, "end_offset": 1579, "text": "operating results", "global_span": [ 3231, 3248 ] }, { "id": 22, "label": "Traditional", "start_offset": 1581, "end_offset": 1598, "text": "average occupancy", "global_span": [ 3250, 3267 ] }, { "id": 23, "label": "Traditional", "start_offset": 1603, "end_offset": 1614, "text": "the quarter", "global_span": [ 3272, 3283 ] }, { "id": 24, "label": "Value", "start_offset": 1619, "end_offset": 1624, "text": "97.5%", "global_span": [ 3288, 3293 ] }, { "id": 25, "label": "Value", "start_offset": 1626, "end_offset": 1646, "text": "down 50 basis points", "global_span": [ 3295, 3315 ] }, { "id": 26, "label": "Traditional", "start_offset": 1705, "end_offset": 1716, "text": "Rent change", "global_span": [ 3374, 3385 ] }, { "id": 27, "label": "Value", "start_offset": 1780, "end_offset": 1783, "text": "79%", "global_span": [ 3449, 3452 ] }, { "id": 28, "label": "Value", "start_offset": 1788, "end_offset": 1791, "text": "48%", "global_span": [ 3457, 3460 ] }, { "id": 29, "label": "Traditional", "start_offset": 1806, "end_offset": 1831, "text": "Net effective rent change", "global_span": [ 3475, 3500 ] }, { "id": 30, "label": "Traditional", "start_offset": 1835, "end_offset": 1843, "text": "signings", "global_span": [ 3504, 3512 ] }, { "id": 31, "label": "Traditional", "start_offset": 1852, "end_offset": 1859, "text": "forward", "global_span": [ 3521, 3528 ] }, { "id": 32, "label": "Traditional", "start_offset": 1862, "end_offset": 1875, "text": "looking build", "global_span": [ 3531, 3544 ] }, { "id": 33, "label": "Value", "start_offset": 1894, "end_offset": 1897, "text": "87%", "global_span": [ 3563, 3566 ] }, { "id": 34, "label": "Traditional", "start_offset": 1911, "end_offset": 1935, "text": "rent change from Phoenix", "global_span": [ 3580, 3604 ] }, { "id": 35, "label": "Value", "start_offset": 1941, "end_offset": 1945, "text": "137%", "global_span": [ 3610, 3614 ] }, { "id": 36, "label": "Traditional", "start_offset": 1947, "end_offset": 1966, "text": "Northern New Jersey", "global_span": [ 3616, 3635 ] }, { "id": 37, "label": "Value", "start_offset": 1970, "end_offset": 1974, "text": "150%", "global_span": [ 3639, 3643 ] }, { "id": 38, "label": "Traditional", "start_offset": 1979, "end_offset": 1998, "text": "Southern California", "global_span": [ 3648, 3667 ] }, { "id": 39, "label": "Value", "start_offset": 2004, "end_offset": 2008, "text": "181%", "global_span": [ 3673, 3677 ] }, { "id": 40, "label": "Traditional", "start_offset": 2068, "end_offset": 2074, "text": "Mexico", "global_span": [ 3737, 3743 ] }, { "id": 41, "label": "Value", "start_offset": 2078, "end_offset": 2081, "text": "34%", "global_span": [ 3747, 3750 ] }, { "id": 42, "label": "Traditional", "start_offset": 2087, "end_offset": 2089, "text": "UK", "global_span": [ 3756, 3758 ] }, { "id": 43, "label": "Value", "start_offset": 2093, "end_offset": 2096, "text": "36%", "global_span": [ 3762, 3765 ] }, { "id": 44, "label": "Traditional", "start_offset": 2098, "end_offset": 2112, "text": "Central Europe", "global_span": [ 3767, 3781 ] }, { "id": 45, "label": "Value", "start_offset": 2116, "end_offset": 2119, "text": "51%", "global_span": [ 3785, 3788 ] }, { "id": 46, "label": "Traditional", "start_offset": 2125, "end_offset": 2131, "text": "Canada", "global_span": [ 3794, 3800 ] }, { "id": 47, "label": "Value", "start_offset": 2137, "end_offset": 2141, "text": "150%", "global_span": [ 3806, 3810 ] }, { "id": 48, "label": "Traditional", "start_offset": 2209, "end_offset": 2221, "text": "Market rents", "global_span": [ 3878, 3890 ] }, { "id": 49, "label": "Value", "start_offset": 2264, "end_offset": 2274, "text": "increasing", "global_span": [ 3933, 3943 ] }, { "id": 50, "label": "Value", "start_offset": 2289, "end_offset": 2296, "text": "1.5% in", "global_span": [ 3958, 3965 ] }, { "id": 51, "label": "Traditional", "start_offset": 2301, "end_offset": 2308, "text": "quarter", "global_span": [ 3970, 3977 ] }, { "id": 52, "label": "Traditional", "start_offset": 2310, "end_offset": 2312, "text": "In", "global_span": [ 3979, 3981 ] }, { "id": 53, "label": "Traditional", "start_offset": 2315, "end_offset": 2331, "text": "place rents grew", "global_span": [ 3984, 4000 ] }, { "id": 54, "label": "Value", "start_offset": 2335, "end_offset": 2358, "text": "approximately 2.5% over", "global_span": [ 4004, 4027 ] }, { "id": 55, "label": "Traditional", "start_offset": 2359, "end_offset": 2370, "text": "the quarter", "global_span": [ 4028, 4039 ] }, { "id": 56, "label": "Value", "start_offset": 2433, "end_offset": 2436, "text": "66%", "global_span": [ 4102, 4105 ] }, { "id": 57, "label": "Value", "start_offset": 2448, "end_offset": 2451, "text": "68%", "global_span": [ 4117, 4120 ] }, { "id": 58, "label": "Traditional", "start_offset": 2488, "end_offset": 2512, "text": "lease mark - to - market", "global_span": [ 4157, 4181 ] }, { "id": 59, "label": "Value", "start_offset": 2528, "end_offset": 2543, "text": "$2.85 per share", "global_span": [ 4197, 4212 ] }, { "id": 60, "label": "Traditional", "start_offset": 2547, "end_offset": 2567, "text": "incremental earnings", "global_span": [ 4216, 4236 ] }, { "id": 61, "label": "Traditional", "start_offset": 2892, "end_offset": 2896, "text": "same", "global_span": [ 4561, 4565 ] }, { "id": 62, "label": "Traditional", "start_offset": 2899, "end_offset": 2911, "text": "store growth", "global_span": [ 4568, 4580 ] }, { "id": 63, "label": "Value", "start_offset": 2992, "end_offset": 2996, "text": "8.9%", "global_span": [ 4661, 4665 ] }, { "id": 64, "label": "Traditional", "start_offset": 3002, "end_offset": 3021, "text": "net effective basis", "global_span": [ 4671, 4690 ] }, { "id": 65, "label": "Value", "start_offset": 3026, "end_offset": 3031, "text": "10.7%", "global_span": [ 4695, 4700 ] }, { "id": 66, "label": "Traditional", "start_offset": 3035, "end_offset": 3039, "text": "cash", "global_span": [ 4704, 4708 ] }, { "id": 67, "label": "Value", "start_offset": 3081, "end_offset": 3091, "text": "$4 billion", "global_span": [ 4750, 4760 ] }, { "id": 68, "label": "Traditional", "start_offset": 3095, "end_offset": 3124, "text": "investment during the quarter", "global_span": [ 4764, 4793 ] }, { "id": 69, "label": "Traditional", "start_offset": 3178, "end_offset": 3187, "text": "liquidity", "global_span": [ 4847, 4856 ] }, { "id": 70, "label": "Value", "start_offset": 3191, "end_offset": 3217, "text": "approximately $6.4 billion", "global_span": [ 4860, 4886 ] }, { "id": 71, "label": "Traditional", "start_offset": 3222, "end_offset": 3240, "text": "debt - to - EBITDA", "global_span": [ 4891, 4909 ] }, { "id": 72, "label": "Value", "start_offset": 3244, "end_offset": 3248, "text": "4.2x", "global_span": [ 4913, 4917 ] }, { "id": 73, "label": "Value", "start_offset": 3274, "end_offset": 3284, "text": "$7 billion", "global_span": [ 4943, 4953 ] }, { "id": 74, "label": "Traditional", "start_offset": 3288, "end_offset": 3325, "text": "debt financing across four currencies", "global_span": [ 4957, 4994 ] }, { "id": 75, "label": "Traditional", "start_offset": 3332, "end_offset": 3345, "text": "interest rate", "global_span": [ 5001, 5014 ] }, { "id": 76, "label": "Traditional", "start_offset": 3349, "end_offset": 3353, "text": "4.9%", "global_span": [ 5018, 5022 ] }, { "id": 77, "label": "Traditional", "start_offset": 3361, "end_offset": 3388, "text": "average term of eight years", "global_span": [ 5030, 5057 ] }, { "id": 78, "label": "Traditional", "start_offset": 3500, "end_offset": 3517, "text": "Proposal activity", "global_span": [ 5169, 5186 ] }, { "id": 79, "label": "Traditional", "start_offset": 3519, "end_offset": 3528, "text": "gestation", "global_span": [ 5188, 5197 ] }, { "id": 80, "label": "Traditional", "start_offset": 3533, "end_offset": 3536, "text": "pre", "global_span": [ 5202, 5205 ] }, { "id": 81, "label": "Traditional", "start_offset": 3539, "end_offset": 3557, "text": "leasing of vacancy", "global_span": [ 5208, 5226 ] }, { "id": 82, "label": "Value", "start_offset": 3566, "end_offset": 3586, "text": "within a few percent", "global_span": [ 5235, 5255 ] }, { "id": 83, "label": "Traditional", "start_offset": 3590, "end_offset": 3599, "text": "their pre", "global_span": [ 5259, 5268 ] }, { "id": 84, "label": "Traditional", "start_offset": 3602, "end_offset": 3614, "text": "COVID levels", "global_span": [ 5271, 5283 ] }, { "id": 85, "label": "Traditional", "start_offset": 3694, "end_offset": 3724, "text": "Our IDI sentiment index ticked", "global_span": [ 5363, 5393 ] }, { "id": 86, "label": "Traditional", "start_offset": 3732, "end_offset": 3739, "text": "quarter", "global_span": [ 5401, 5408 ] }, { "id": 87, "label": "Value", "start_offset": 3743, "end_offset": 3750, "text": "over 58", "global_span": [ 5412, 5419 ] }, { "id": 88, "label": "Traditional", "start_offset": 3821, "end_offset": 3830, "text": "customers", "global_span": [ 5490, 5499 ] }, { "id": 89, "label": "Traditional", "start_offset": 3856, "end_offset": 3867, "text": "utilization", "global_span": [ 5525, 5536 ] }, { "id": 90, "label": "Value", "start_offset": 3882, "end_offset": 3887, "text": "85.5%", "global_span": [ 5551, 5556 ] }, { "id": 91, "label": "Traditional", "start_offset": 4069, "end_offset": 4088, "text": "construction starts", "global_span": [ 5738, 5757 ] }, { "id": 92, "label": "Value", "start_offset": 4101, "end_offset": 4123, "text": "declined significantly", "global_span": [ 5770, 5792 ] }, { "id": 93, "label": "Traditional", "start_offset": 4146, "end_offset": 4152, "text": "Starts", "global_span": [ 5815, 5821 ] }, { "id": 94, "label": "Traditional", "start_offset": 4160, "end_offset": 4174, "text": "second quarter", "global_span": [ 5829, 5843 ] }, { "id": 95, "label": "Value", "start_offset": 4180, "end_offset": 4202, "text": "down approximately 40%", "global_span": [ 5849, 5871 ] }, { "id": 96, "label": "Traditional", "start_offset": 4214, "end_offset": 4224, "text": "US markets", "global_span": [ 5883, 5893 ] }, { "id": 97, "label": "Value", "start_offset": 4229, "end_offset": 4231, "text": "50", "global_span": [ 5898, 5900 ] }, { "id": 98, "label": "Traditional", "start_offset": 4236, "end_offset": 4242, "text": "Europe", "global_span": [ 5905, 5911 ] }, { "id": 99, "label": "Value", "start_offset": 4450, "end_offset": 4453, "text": "97%", "global_span": [ 6119, 6122 ] }, { "id": 100, "label": "Value", "start_offset": 5338, "end_offset": 5340, "text": "5%", "global_span": [ 7007, 7009 ] }, { "id": 101, "label": "Traditional", "start_offset": 5341, "end_offset": 5355, "text": "rent growth to", "global_span": [ 7010, 7024 ] }, { "id": 102, "label": "Traditional", "start_offset": 5358, "end_offset": 5362, "text": "date", "global_span": [ 7027, 7031 ] }, { "id": 103, "label": "Traditional", "start_offset": 5375, "end_offset": 5386, "text": "forecasting", "global_span": [ 7044, 7055 ] }, { "id": 104, "label": "Traditional", "start_offset": 5391, "end_offset": 5400, "text": "full year", "global_span": [ 7060, 7069 ] }, { "id": 105, "label": "Value", "start_offset": 5415, "end_offset": 5423, "text": "7% to 9%", "global_span": [ 7084, 7092 ] }, { "id": 106, "label": "Value", "start_offset": 5845, "end_offset": 5847, "text": "8%", "global_span": [ 7514, 7516 ] }, { "id": 107, "label": "Traditional", "start_offset": 5848, "end_offset": 5861, "text": "unlevered IRR", "global_span": [ 7517, 7530 ] }, { "id": 108, "label": "Traditional", "start_offset": 5869, "end_offset": 5890, "text": "at the property level", "global_span": [ 7538, 7559 ] }, { "id": 109, "label": "Traditional", "start_offset": 6208, "end_offset": 6221, "text": "Europe values", "global_span": [ 7877, 7890 ] }, { "id": 110, "label": "Value", "start_offset": 6266, "end_offset": 6276, "text": "1% decline", "global_span": [ 7935, 7945 ] }, { "id": 111, "label": "Traditional", "start_offset": 6286, "end_offset": 6300, "text": "second quarter", "global_span": [ 7955, 7969 ] }, { "id": 112, "label": "Traditional", "start_offset": 6302, "end_offset": 6315, "text": "Latin America", "global_span": [ 7971, 7984 ] }, { "id": 113, "label": "Traditional", "start_offset": 6323, "end_offset": 6331, "text": "increase", "global_span": [ 7992, 8000 ] }, { "id": 114, "label": "Traditional", "start_offset": 6335, "end_offset": 6341, "text": "values", "global_span": [ 8004, 8010 ] }, { "id": 115, "label": "Traditional", "start_offset": 6347, "end_offset": 6352, "text": "write", "global_span": [ 8016, 8021 ] }, { "id": 116, "label": "Traditional", "start_offset": 6355, "end_offset": 6358, "text": "ups", "global_span": [ 8024, 8027 ] }, { "id": 117, "label": "Traditional", "start_offset": 6362, "end_offset": 6368, "text": "Brazil", "global_span": [ 8031, 8037 ] }, { "id": 118, "label": "Traditional", "start_offset": 6373, "end_offset": 6379, "text": "Mexico", "global_span": [ 8042, 8048 ] }, { "id": 119, "label": "Value", "start_offset": 6383, "end_offset": 6385, "text": "2%", "global_span": [ 8052, 8054 ] }, { "id": 120, "label": "Value", "start_offset": 6390, "end_offset": 6392, "text": "5%", "global_span": [ 8059, 8061 ] }, { "id": 121, "label": "Traditional", "start_offset": 6410, "end_offset": 6415, "text": "write", "global_span": [ 8079, 8084 ] }, { "id": 122, "label": "Traditional", "start_offset": 6418, "end_offset": 6423, "text": "downs", "global_span": [ 8087, 8092 ] }, { "id": 123, "label": "Traditional", "start_offset": 6431, "end_offset": 6433, "text": "US", "global_span": [ 8100, 8102 ] }, { "id": 124, "label": "Value", "start_offset": 6479, "end_offset": 6481, "text": "5%", "global_span": [ 8148, 8150 ] }, { "id": 125, "label": "Traditional", "start_offset": 6494, "end_offset": 6531, "text": "cumulative decline over the last year", "global_span": [ 8163, 8200 ] }, { "id": 126, "label": "Value", "start_offset": 6535, "end_offset": 6538, "text": "12%", "global_span": [ 8204, 8207 ] }, { "id": 127, "label": "Traditional", "start_offset": 6651, "end_offset": 6697, "text": "New redemption requests in the quarter totaled", "global_span": [ 8320, 8366 ] }, { "id": 128, "label": "Value", "start_offset": 6698, "end_offset": 6724, "text": "approximately $800 million", "global_span": [ 8367, 8393 ] }, { "id": 129, "label": "Traditional", "start_offset": 6847, "end_offset": 6870, "text": "redemption queue stands", "global_span": [ 8516, 8539 ] }, { "id": 130, "label": "Value", "start_offset": 6874, "end_offset": 6900, "text": "approximately $1.6 billion", "global_span": [ 8543, 8569 ] }, { "id": 131, "label": "Traditional", "start_offset": 6937, "end_offset": 6951, "text": "company raised", "global_span": [ 8606, 8620 ] }, { "id": 132, "label": "Traditional", "start_offset": 6955, "end_offset": 6966, "text": "incremental", "global_span": [ 8624, 8635 ] }, { "id": 133, "label": "Value", "start_offset": 6967, "end_offset": 6979, "text": "$1.2 billion", "global_span": [ 8636, 8648 ] }, { "id": 134, "label": "Value", "start_offset": 6993, "end_offset": 7005, "text": "$500 million", "global_span": [ 8662, 8674 ] }, { "id": 135, "label": "Traditional", "start_offset": 7013, "end_offset": 7018, "text": "FIBRA", "global_span": [ 8682, 8687 ] }, { "id": 136, "label": "Traditional", "start_offset": 7023, "end_offset": 7026, "text": "NPR", "global_span": [ 8692, 8695 ] }, { "id": 137, "label": "Traditional", "start_offset": 7041, "end_offset": 7044, "text": "new", "global_span": [ 8710, 8713 ] }, { "id": 138, "label": "Value", "start_offset": 7045, "end_offset": 7057, "text": "$700 million", "global_span": [ 8714, 8726 ] }, { "id": 139, "label": "Traditional", "start_offset": 7058, "end_offset": 7068, "text": "commitment", "global_span": [ 8727, 8737 ] }, { "id": 140, "label": "Traditional", "start_offset": 7075, "end_offset": 7096, "text": "complementary vehicle", "global_span": [ 8744, 8765 ] }, { "id": 141, "label": "Traditional", "start_offset": 7100, "end_offset": 7105, "text": "Japan", "global_span": [ 8769, 8774 ] }, { "id": 142, "label": "Traditional", "start_offset": 7107, "end_offset": 7111, "text": "PJLF", "global_span": [ 8776, 8780 ] }, { "id": 143, "label": "Traditional", "start_offset": 7252, "end_offset": 7257, "text": "added", "global_span": [ 8921, 8926 ] }, { "id": 144, "label": "Value", "start_offset": 7258, "end_offset": 7260, "text": "45", "global_span": [ 8927, 8929 ] }, { "id": 145, "label": "Traditional", "start_offset": 7261, "end_offset": 7270, "text": "megawatts", "global_span": [ 8930, 8939 ] }, { "id": 146, "label": "Traditional", "start_offset": 7278, "end_offset": 7294, "text": "solar production", "global_span": [ 8947, 8963 ] }, { "id": 147, "label": "Traditional", "start_offset": 7299, "end_offset": 7306, "text": "storage", "global_span": [ 8968, 8975 ] }, { "id": 148, "label": "Traditional", "start_offset": 7314, "end_offset": 7336, "text": "first half of the year", "global_span": [ 8983, 9005 ] }, { "id": 149, "label": "Traditional", "start_offset": 7351, "end_offset": 7365, "text": "platform total", "global_span": [ 9020, 9034 ] }, { "id": 150, "label": "Value", "start_offset": 7369, "end_offset": 7382, "text": "450 megawatts", "global_span": [ 9038, 9051 ] }, { "id": 151, "label": "Value", "start_offset": 7391, "end_offset": 7394, "text": "50%", "global_span": [ 9060, 9063 ] }, { "id": 152, "label": "Value", "start_offset": 7413, "end_offset": 7414, "text": "1", "global_span": [ 9082, 9083 ] }, { "id": 153, "label": "Traditional", "start_offset": 7415, "end_offset": 7428, "text": "gigawatt goal", "global_span": [ 9084, 9097 ] }, { "id": 154, "label": "Traditional", "start_offset": 7433, "end_offset": 7437, "text": "2025", "global_span": [ 9102, 9106 ] }, { "id": 155, "label": "Non_Traditional", "start_offset": 7455, "end_offset": 7472, "text": "Prologis Mobility", "global_span": [ 9124, 9141 ] }, { "id": 156, "label": "Non_Traditional", "start_offset": 7478, "end_offset": 7489, "text": "EV business", "global_span": [ 9147, 9158 ] }, { "id": 157, "label": "Value", "start_offset": 7504, "end_offset": 7506, "text": "65", "global_span": [ 9173, 9175 ] }, { "id": 158, "label": "Non_Traditional", "start_offset": 7507, "end_offset": 7526, "text": "lead charging sites", "global_span": [ 9176, 9195 ] }, { "id": 159, "label": "Traditional", "start_offset": 7631, "end_offset": 7656, "text": "guiding average occupancy", "global_span": [ 9300, 9325 ] }, { "id": 160, "label": "Traditional", "start_offset": 7660, "end_offset": 7665, "text": "range", "global_span": [ 9329, 9334 ] }, { "id": 161, "label": "Value", "start_offset": 7674, "end_offset": 7687, "text": "97% and 97.5%", "global_span": [ 9343, 9356 ] }, { "id": 162, "label": "Traditional", "start_offset": 7789, "end_offset": 7808, "text": "net effective basis", "global_span": [ 9458, 9477 ] }, { "id": 163, "label": "Value", "start_offset": 7813, "end_offset": 7824, "text": "9.5% to 10%", "global_span": [ 9482, 9493 ] }, { "id": 164, "label": "Traditional", "start_offset": 7844, "end_offset": 7892, "text": "Net effective rent change propelling same stores", "global_span": [ 9513, 9561 ] }, { "id": 165, "label": "Value", "start_offset": 7958, "end_offset": 7975, "text": "approximately 80%", "global_span": [ 9627, 9644 ] }, { "id": 166, "label": "Traditional", "start_offset": 7985, "end_offset": 7989, "text": "year", "global_span": [ 9654, 9658 ] }, { "id": 167, "label": "Traditional", "start_offset": 8014, "end_offset": 8026, "text": "G&A guidance", "global_span": [ 9683, 9695 ] }, { "id": 168, "label": "Value", "start_offset": 8044, "end_offset": 8056, "text": "$380 million", "global_span": [ 9713, 9725 ] }, { "id": 169, "label": "Value", "start_offset": 8061, "end_offset": 8073, "text": "$390 million", "global_span": [ 9730, 9742 ] }, { "id": 170, "label": "Traditional", "start_offset": 8097, "end_offset": 8150, "text": "strategic capital revenue guidance excluding promotes", "global_span": [ 9766, 9819 ] }, { "id": 171, "label": "Value", "start_offset": 8168, "end_offset": 8180, "text": "$520 million", "global_span": [ 9837, 9849 ] }, { "id": 172, "label": "Value", "start_offset": 8185, "end_offset": 8197, "text": "$530 million", "global_span": [ 9854, 9866 ] }, { "id": 173, "label": "Traditional", "start_offset": 8236, "end_offset": 8240, "text": "USLF", "global_span": [ 9905, 9909 ] }, { "id": 174, "label": "Traditional", "start_offset": 8244, "end_offset": 8252, "text": "promotes", "global_span": [ 9913, 9921 ] }, { "id": 175, "label": "Traditional", "start_offset": 8289, "end_offset": 8307, "text": "net promote income", "global_span": [ 9958, 9976 ] }, { "id": 176, "label": "Value", "start_offset": 8311, "end_offset": 8323, "text": "$475 million", "global_span": [ 9980, 9992 ] }, { "id": 177, "label": "Traditional", "start_offset": 8596, "end_offset": 8607, "text": "spec starts", "global_span": [ 10265, 10276 ] }, { "id": 178, "label": "Traditional", "start_offset": 8632, "end_offset": 8640, "text": "guidance", "global_span": [ 10301, 10309 ] }, { "id": 179, "label": "Value", "start_offset": 8644, "end_offset": 8656, "text": "$2.5 billion", "global_span": [ 10313, 10325 ] }, { "id": 180, "label": "Value", "start_offset": 8660, "end_offset": 8670, "text": "$3 billion", "global_span": [ 10329, 10339 ] }, { "id": 181, "label": "Value", "start_offset": 8697, "end_offset": 8709, "text": "$550 million", "global_span": [ 10366, 10378 ] }, { "id": 182, "label": "Traditional", "start_offset": 8713, "end_offset": 8768, "text": "contribution in disposition activity during the quarter", "global_span": [ 10382, 10437 ] }, { "id": 183, "label": "Traditional", "start_offset": 8822, "end_offset": 8830, "text": "guidance", "global_span": [ 10491, 10499 ] }, { "id": 184, "label": "Value", "start_offset": 8834, "end_offset": 8858, "text": "$2 billion to $3 billion", "global_span": [ 10503, 10527 ] }, { "id": 185, "label": "Traditional", "start_offset": 8905, "end_offset": 8913, "text": "guidance", "global_span": [ 10574, 10582 ] }, { "id": 186, "label": "Traditional", "start_offset": 8918, "end_offset": 8931, "text": "GAAP earnings", "global_span": [ 10587, 10600 ] }, { "id": 187, "label": "Traditional", "start_offset": 8935, "end_offset": 8940, "text": "range", "global_span": [ 10604, 10609 ] }, { "id": 188, "label": "Value", "start_offset": 8949, "end_offset": 8974, "text": "$3.30 and $3.40 per share", "global_span": [ 10618, 10643 ] }, { "id": 189, "label": "Traditional", "start_offset": 8994, "end_offset": 9030, "text": "core FFO including promotes guidance", "global_span": [ 10663, 10699 ] }, { "id": 190, "label": "Traditional", "start_offset": 9036, "end_offset": 9041, "text": "range", "global_span": [ 10705, 10710 ] }, { "id": 191, "label": "Value", "start_offset": 9045, "end_offset": 9069, "text": "$5.56 to $5.60 per share", "global_span": [ 10714, 10738 ] }, { "id": 192, "label": "Traditional", "start_offset": 9074, "end_offset": 9112, "text": "increasing core FFO executing promotes", "global_span": [ 10743, 10781 ] }, { "id": 193, "label": "Traditional", "start_offset": 9116, "end_offset": 9121, "text": "range", "global_span": [ 10785, 10790 ] }, { "id": 194, "label": "Value", "start_offset": 9130, "end_offset": 9155, "text": "$5.06 and $5.10 per share", "global_span": [ 10799, 10824 ] }, { "id": 195, "label": "Traditional", "start_offset": 9165, "end_offset": 9186, "text": "midpoint representing", "global_span": [ 10834, 10855 ] }, { "id": 196, "label": "Value", "start_offset": 9192, "end_offset": 9195, "text": "10%", "global_span": [ 10861, 10864 ] }, { "id": 197, "label": "Traditional", "start_offset": 9196, "end_offset": 9209, "text": "annual growth", "global_span": [ 10865, 10878 ] }, { "id": 270, "label": "Traditional", "text": " cash basis", "start_offset": 1767, "end_offset": 1778, "global_span": [ 3436, 3447 ] }, { "id": 271, "label": "Traditional", "text": "strong signings ", "start_offset": 2047, "end_offset": 2063, "global_span": [ 3716, 3732 ] }, { "id": 272, "label": "Traditional", "text": "lease mark - to - market of", "start_offset": 2405, "end_offset": 2432, "global_span": [ 4074, 4101 ] }, { "id": 273, "label": "non_traditional", "text": "leased", "start_offset": 4454, "end_offset": 4460, "global_span": [ 6123, 6129 ] }, { "id": 274, "label": "Traditional", "text": "cash basis", "start_offset": 7830, "end_offset": 7840, "global_span": [ 9499, 9509 ] } ], "relations": [ { "id": 1, "entity_ids": [ 0, 1, 2, 3 ], "description": "Value_of" }, { "id": 2, "entity_ids": [ 4, 5 ], "description": "Value_of" }, { "id": 3, "entity_ids": [ 6, 7 ], "description": "Value_of" }, { "id": 4, "entity_ids": [ 8, 9 ], "description": "Value_of" }, { "id": 5, "entity_ids": [ 6, 8, 10, 11 ], "description": "Value_of" }, { "id": 6, "entity_ids": [ 12, 13, 14 ], "description": "Value_of" }, { "id": 7, "entity_ids": [ 15, 16 ], "description": "Value_of" }, { "id": 8, "entity_ids": [ 17, 18 ], "description": "Value_of" }, { "id": 9, "entity_ids": [ 17, 18, 19, 20 ], "description": "Value_of" }, { "id": 10, "entity_ids": [ 21, 22, 23, 24 ], "description": "Value_of" }, { "id": 11, "entity_ids": [ 21, 22, 23, 25 ], "description": "Value_of" }, { "id": 12, "entity_ids": [ 26, 27 ], "description": "Value_of" }, { "id": 13, "entity_ids": [ 26, 28, 270 ], "description": "Value_of" }, { "id": 14, "entity_ids": [ 29, 30, 31, 32, 33 ], "description": "Value_of" }, { "id": 15, "entity_ids": [ 29, 34, 35 ], "description": "Value_of" }, { "id": 16, "entity_ids": [ 29, 36, 37 ], "description": "Value_of" }, { "id": 17, "entity_ids": [ 29, 38, 39 ], "description": "Value_of" }, { "id": 18, "entity_ids": [ 40, 41 ], "description": "Value_of" }, { "id": 19, "entity_ids": [ 42, 43 ], "description": "Value_of" }, { "id": 20, "entity_ids": [ 44, 45, 271 ], "description": "Value_of" }, { "id": 21, "entity_ids": [ 46, 47, 271 ], "description": "Value_of" }, { "id": 22, "entity_ids": [ 48, 49, 50, 51 ], "description": "Value_of" }, { "id": 23, "entity_ids": [ 52, 53, 54 ], "description": "Value_of" }, { "id": 24, "entity_ids": [ 52, 53, 54, 55 ], "description": "Value_of" }, { "id": 25, "entity_ids": [ 56, 272 ], "description": "Value_of" }, { "id": 26, "entity_ids": [ 57, 272 ], "description": "Value_of" }, { "id": 27, "entity_ids": [ 58, 59, 60 ], "description": "Value_of" }, { "id": 28, "entity_ids": [ 61, 62, 63 ], "description": "Value_of" }, { "id": 29, "entity_ids": [ 61, 62, 63, 64 ], "description": "Value_of" }, { "id": 30, "entity_ids": [ 61, 62, 63, 65, 66 ], "description": "Value_of" }, { "id": 31, "entity_ids": [ 67, 68 ], "description": "Value_of" }, { "id": 32, "entity_ids": [ 69, 70 ], "description": "Value_of" }, { "id": 33, "entity_ids": [ 71, 72 ], "description": "Value_of" }, { "id": 34, "entity_ids": [ 73, 74 ], "description": "Value_of" }, { "id": 35, "entity_ids": [ 75, 76 ], "description": "Value_of" }, { "id": 36, "entity_ids": [ 78, 79, 80, 81, 82, 83, 84 ], "description": "Value_of" }, { "id": 37, "entity_ids": [ 85, 86, 87 ], "description": "Value_of" }, { "id": 38, "entity_ids": [ 88, 89, 90 ], "description": "Value_of" }, { "id": 39, "entity_ids": [ 91, 92 ], "description": "Value_of" }, { "id": 40, "entity_ids": [ 93, 94, 95, 96 ], "description": "Value_of" }, { "id": 41, "entity_ids": [ 93, 94, 97, 98 ], "description": "Value_of" }, { "id": 42, "entity_ids": [ 99, 273 ], "description": "Value_of" }, { "id": 43, "entity_ids": [ 100, 101, 102 ], "description": "Value_of" }, { "id": 44, "entity_ids": [ 103, 104, 105 ], "description": "Value_of" }, { "id": 45, "entity_ids": [ 106, 107, 108 ], "description": "Value_of" }, { "id": 46, "entity_ids": [ 100, 101, 102 ], "description": "Value_of" }, { "id": 47, "entity_ids": [ 101, 103, 104, 105 ], "description": "Value_of" }, { "id": 48, "entity_ids": [ 106, 107, 108 ], "description": "Value_of" }, { "id": 49, "entity_ids": [ 109, 110, 111 ], "description": "Value_of" }, { "id": 50, "entity_ids": [ 112, 113, 114, 115, 116, 117, 119 ], "description": "Value_of" }, { "id": 51, "entity_ids": [ 111, 112, 113, 114, 115, 116, 118, 120 ], "description": "Value_of" }, { "id": 52, "entity_ids": [ 121, 122, 123, 124 ], "description": "Value_of" }, { "id": 53, "entity_ids": [ 125, 126 ], "description": "Value_of" }, { "id": 54, "entity_ids": [ 127, 128 ], "description": "Value_of" }, { "id": 55, "entity_ids": [ 129, 130 ], "description": "Value_of" }, { "id": 56, "entity_ids": [ 131, 132, 133 ], "description": "Value_of" }, { "id": 57, "entity_ids": [ 134, 135, 136 ], "description": "Value_of" }, { "id": 58, "entity_ids": [ 137, 138, 139, 140, 141 ], "description": "Value_of" }, { "id": 59, "entity_ids": [ 143, 144, 145, 146, 147, 148 ], "description": "Value_of" }, { "id": 60, "entity_ids": [ 149, 150 ], "description": "Value_of" }, { "id": 61, "entity_ids": [ 151, 152, 153, 154 ], "description": "Value_of" }, { "id": 62, "entity_ids": [ 155, 156, 157, 158 ], "description": "Value_of" }, { "id": 63, "entity_ids": [ 159, 160, 161 ], "description": "Value_of" }, { "id": 64, "entity_ids": [ 162, 163, 274 ], "description": "Value_of" }, { "id": 65, "entity_ids": [ 164, 165, 166 ], "description": "Value_of" }, { "id": 66, "entity_ids": [ 167, 168, 169 ], "description": "Value_of" }, { "id": 67, "entity_ids": [ 170, 171, 172 ], "description": "Value_of" }, { "id": 68, "entity_ids": [ 173, 174, 175, 176 ], "description": "Value_of" }, { "id": 69, "entity_ids": [ 177, 178, 179 ], "description": "Value_of" }, { "id": 70, "entity_ids": [ 177, 178, 180 ], "description": "Value_of" }, { "id": 71, "entity_ids": [ 181, 182 ], "description": "Value_of" }, { "id": 72, "entity_ids": [ 185, 186, 187, 188 ], "description": "Value_ofValue_of" }, { "id": 73, "entity_ids": [ 189, 190, 191 ], "description": "Value_of" }, { "id": 74, "entity_ids": [ 192, 193, 194 ], "description": "Value_of" }, { "id": 75, "entity_ids": [ 192, 195, 196, 197 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 3, "sub_chunk_id": 0, "sentences": "Operator: [Operator Instructions ] Our first question comes from Tom Catherwood with BTIG. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 4, "sub_chunk_id": 0, "sentences": "Tom Catherwood: Thank you, and good morning all. Tim, appreciate your commentary around guidance on projected rent growth. Kind of a two - part question on that first. Have you adjusted your projection for US rent growth? I think it was previously 10% and you mentioned it globally now. And then, can you provide some more detail around those markets or regions where as you said you ' ve seen you know rent growth and values kind of exceed expectations and then conversely are there others like Southern California that have somewhat lagged your expectations?", "ground_truth_output": { "entities": [ { "id": 198, "label": "Traditional", "start_offset": 207, "end_offset": 221, "text": "US rent growth", "global_span": [ 12524, 12538 ] }, { "id": 199, "label": "Traditional", "start_offset": 225, "end_offset": 230, "text": "think", "global_span": [ 12542, 12547 ] }, { "id": 200, "label": "Value", "start_offset": 249, "end_offset": 252, "text": "10%", "global_span": [ 12566, 12569 ] } ], "relations": [ { "id": 76, "entity_ids": [ 198, 199, 200 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 5, "sub_chunk_id": 0, "sentences": "Tim Arndt: Hey, Tom, I 'll start and probably pitch it to Chris here for some help on the market detail. But the U.S. at this point, I would put in a similar range, really given the weight of the U.S. and the notion that we 're going to put these things in ranges probably from here, it 's going to be very similar to the globe. So I would just think of them as essentially the same. And then, in terms of markets, clearly, I mentioned in my remarks that Southern California is the market that we ' ve downgraded. That 's broadly the base of our change and pretty much the only market and it is matched by various markets as are also detailed many in Southeast US, but it 's pretty broad around the US, as well as globally that are picking up the slack and holding the average pretty close when you put it in a range.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 6, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Blaine Heck with Wells Fargo. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 7, "sub_chunk_id": 0, "sentences": "Blaine Heck: Great. Thanks. Good morning. So we noticed lease proposals trended downward throughout the quarter and gestation increased towards the end of the quarter. Can you just talk about what factors might be driving those trends? And whether you think we 'll continue to see lease proposals trend down or should we expect an inflection in the second half?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 8, "sub_chunk_id": 0, "sentences": "Chris Caton: Hey, it 's Chris Caton. So, really when we look at that data, the right way to look at that is against our open availabilities. And when you put those proposals against our open availabilities they are actually in line or above the historical average, 48% is that number, it 's something we ' ve used in the past on these calls. And so how we do make the proposal numbers you 're talking about tie with that view, well, there are two or three drivers. The first is that the availabilities just, the role that we have in the next 12 months are low relative to history. The second is those proposal volumes do include, sometimes multiple proposals on a single unit and that has declined over the last year as we ' ve discussed previously. And then, third, there 's some seasonality where June would be a soft month.", "ground_truth_output": { "entities": [ { "id": 201, "label": "Traditional", "start_offset": 167, "end_offset": 208, "text": "proposals against our open availabilities", "global_span": [ 14328, 14369 ] }, { "id": 202, "label": "Value", "start_offset": 227, "end_offset": 266, "text": "in line or above the historical average", "global_span": [ 14388, 14427 ] }, { "id": 203, "label": "Value", "start_offset": 268, "end_offset": 271, "text": "48%", "global_span": [ 14429, 14432 ] } ], "relations": [ { "id": 77, "entity_ids": [ 201, 202, 203 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 9, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Craig Mailman with Citi. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 10, "sub_chunk_id": 0, "sentences": "Craig Mailman: Yes. Thank you very much. Maybe it 's open two questions here, I guess, maybe Tim and Chris to follow - up on Tom 's question around the market rent growth. It looks like the U.S. dropped about 200 basis points. And if could you give us some more numbers around what the biggest moving parts of that were from a market perspective? And then, separately on, on occupancy here, you guys seemed at 80 BPS sequentially on ending core occupancy and then you 're 50 basis points on average. But, Secaucus, New Jersey, Central Valley, Atlanta, all kind of came down here. Just curious if there 's, if that 's where you 're seeing the more supply or if you had any incremental impact from the Blackstone acquisition that was laid some of those numbers?", "ground_truth_output": { "entities": [ { "id": 204, "label": "Value", "start_offset": 411, "end_offset": 417, "text": "80 BPS", "global_span": [ 15495, 15501 ] }, { "id": 205, "label": "Traditional", "start_offset": 418, "end_offset": 430, "text": "sequentially", "global_span": [ 15502, 15514 ] }, { "id": 206, "label": "Traditional", "start_offset": 434, "end_offset": 455, "text": "ending core occupancy", "global_span": [ 15518, 15539 ] }, { "id": 207, "label": "Value", "start_offset": 473, "end_offset": 488, "text": "50 basis points", "global_span": [ 15557, 15572 ] } ], "relations": [ { "id": 78, "entity_ids": [ 204, 205, 206, 207 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 11, "sub_chunk_id": 0, "sentences": "Tim Arndt: Yeah, so, on the, on the rent piece, we 're not going to go through market rent growth at a market level for a variety of reasons. I think the takeaway we want you and everyone to be left with is just how it can all come into a balance and we 're very pleased to see that we 're able to hold the forecast at least in a pretty tight range to where we were previously. And on the occupancy side, you 're right about where the ending pieces. I would just comment that that 's in line with our forecast. If you look at our average same - store, average occupancy guidance that we have previously and that we have this quarter, it 's unchanged. So, the decline that we have expected over the year remains and everything that you see in this quarter is in line with those expectations.", "ground_truth_output": { "entities": [ { "id": 208, "label": "Traditional", "start_offset": 555, "end_offset": 581, "text": "average occupancy guidance", "global_span": [ 16401, 16427 ] }, { "id": 209, "label": "Value", "start_offset": 643, "end_offset": 652, "text": "unchanged", "global_span": [ 16489, 16498 ] } ], "relations": [ { "id": 79, "entity_ids": [ 208, 209 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 12, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Yeah. The one thing I would add to that is that, I think we mentioned to you last quarter that we would be continuing to push rents pretty hard and would like to see occupancies a bit lower than 98%. So, what you think is consistent with what we 're planning to do and actually we accomplished what we wanted to do in that we tracked a number of leases that we lose because of price and how hard we were pushing. And we modulate around that to figure out the trade - off between rents and occupancy. So we did see as a result of our efforts, an uptick in basically the percentage of deals lost due to price. It went up from about 10% to about 20%, which is kind of where we would like to have it. So it ’s [Indiscernible ].", "ground_truth_output": { "entities": [ { "id": 210, "label": "Traditional", "start_offset": 602, "end_offset": 625, "text": "deals lost due to price", "global_span": [ 17241, 17264 ] }, { "id": 211, "label": "Traditional", "start_offset": 630, "end_offset": 637, "text": "went up", "global_span": [ 17269, 17276 ] }, { "id": 212, "label": "Value", "start_offset": 649, "end_offset": 652, "text": "10%", "global_span": [ 17288, 17291 ] }, { "id": 213, "label": "Value", "start_offset": 662, "end_offset": 665, "text": "20%", "global_span": [ 17301, 17304 ] } ], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 13, "sub_chunk_id": 0, "sentences": "Operator: Thank you. Our next question comes from Caitlin Burrows with Goldman Sachs. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 14, "sub_chunk_id": 0, "sentences": "Caitlin Burrows: Hi, good morning, everyone. Maybe like to mention there has been a lot of discussion about Southern California. So ask another one there, but I guess just thinking about the idea that it might be lagging now, can you give more details on what could be causing the change in that market? Kind of how long it could last in which market could potentially face similar issues?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 15, "sub_chunk_id": 0, "sentences": "Chris Caton: Sure. Let me take a stab at that, because I ' ve seen this now a couple of times over the last 30, 40 years. Southern California is really being adversely affected by two things. One, ports volumes. I think this labor strike has gone on longer than most people anticipated. And the timing of it was such that people have to make decisions about the Christmas season and they ' ve shifted volumes to other ports. And that affect Southern California and honestly, the longer disclose out, I believe the worse it will be for Southern California in terms of doing permanent damage. From now from everything we hear and we 're not an expert on this, things are apparently heading in a positive direction with respect to a resolution. But you read the same things we do. So, I do n't have any unique perspectives on that. The other, the other difference with Southern California is just pricing. I mean, you had between ‘ 20 and ‘ 22, about an 130% increase in rents in Southern California, that compares to less than half of that for the overall markets that we operate in. So, there is more price sensitivity now because it 's a very, very expensive market. So to the extent possible, people will shift to adjacent markets. And combined, it 's not just price, but up until a quarter ago, occupancies in the Inland Empire was 99 point something percent. So people could n't even get the space that they wanted. I think with the more normalized vacancy level and we 're still not at normal. I mean, normalized in my experience is 95% occupancy and that would have been great for the last 15 or 20 years. I think with more normalized occupancy, you 'll see, Peep and a resolution of the labor strike. I think you see a more normal pattern from which you can draw some conclusions.", "ground_truth_output": { "entities": [ { "id": 214, "label": "Traditional", "start_offset": 934, "end_offset": 945, "text": "20 and ‘ 22", "global_span": [ 18819, 18830 ] }, { "id": 215, "label": "Value", "start_offset": 947, "end_offset": 952, "text": "about", "global_span": [ 18832, 18837 ] }, { "id": 216, "label": "Value", "start_offset": 956, "end_offset": 960, "text": "130%", "global_span": [ 18841, 18845 ] }, { "id": 217, "label": "Traditional", "start_offset": 961, "end_offset": 1001, "text": "increase in rents in Southern California", "global_span": [ 18846, 18886 ] }, { "id": 218, "label": "Traditional", "start_offset": 1304, "end_offset": 1336, "text": "occupancies in the Inland Empire", "global_span": [ 19189, 19221 ] }, { "id": 219, "label": "Value", "start_offset": 1341, "end_offset": 1367, "text": "99 point something percent", "global_span": [ 19226, 19252 ] } ], "relations": [ { "id": 80, "entity_ids": [ 214, 215, 216, 217 ], "description": "Value_of" }, { "id": 81, "entity_ids": [ 218, 219 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 16, "sub_chunk_id": 0, "sentences": "Operator: Thank you. And our next question comes from Steve Sakwa with Evercore. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 17, "sub_chunk_id": 0, "sentences": "Steve Sakwa: Yeah. Thanks. Hi, good morning. I guess, really kind of a two parter. Just, Hamid, if you could just maybe talk about demand by size of tenant and knowing of whether you 're seeing any real disparities in sort of the under 250 or under 100 and anything kind of on the bigger side? And then, just I guess your confidence level around the level of development starts. It 's obviously a very back - end weighted sort of hockey stick figure for the second half of the year. So, how much of those projects are currently teed up. And what do you think that split of starts looks like between the third and the fourth quarters?", "ground_truth_output": { "entities": [ { "id": 220, "label": "Traditional", "start_offset": 142, "end_offset": 156, "text": "size of tenant", "global_span": [ 19931, 19945 ] }, { "id": 221, "label": "Value", "start_offset": 231, "end_offset": 240, "text": "under 250", "global_span": [ 20020, 20029 ] }, { "id": 222, "label": "Value", "start_offset": 244, "end_offset": 253, "text": "under 100", "global_span": [ 20033, 20042 ] } ], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 18, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Yeah. Let me start on the development volume and then pitch it over to Dan for the other commentary. We do not care about development starts. We do not care about acquisition guidance. We will - we make all these decisions one - by - one and only when it makes sense to pull the trigger on these. They 're buying large already more or less and we could, on a discretionary basis, start all of them today. But that would not be a wise thing to do and we 're not going to do it just to meet some artificial guidance. I think the main driver of earnings in this company, which is what we all care about is rental growth and same - store growth. And all I can tell you is that with mid-60s mark - to - market, you can model whatever scenario you want, including zero rent growth from here on out. And for the next four years, five years, you 're going to get same - store NOI increase of 7.5% with no rental growth from this point forward. You put in our normalized forecast for a rental growth our best guess and that same - store growth will be at 8.5%. Both of those numbers are consistent with low - double - digit earnings growth, while maintaining our leverage, which is, which is so low. So, I do n't - we do n't need development starts to drive anything, and we 're not going to get in a position of – or jeopardizing our pricing power by virtue of wanting to meet an artificial development goal. Now having said all that, we will start the ones that we think we can lease efficiently and economically and quickly. And the land is there. The approvals are there. And our ability to put buildings up is there. So, there is no benefit in front end loading that stuff and pushing it ahead of where it needs to be. Dan, do you want to address the site question?", "ground_truth_output": { "entities": [ { "id": 223, "label": "Traditional", "start_offset": 889, "end_offset": 901, "text": "NOI increase", "global_span": [ 21314, 21326 ] }, { "id": 224, "label": "Value", "start_offset": 905, "end_offset": 909, "text": "7.5%", "global_span": [ 21330, 21334 ] }, { "id": 225, "label": "Value", "start_offset": 1069, "end_offset": 1073, "text": "8.5%", "global_span": [ 21494, 21498 ] } ], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 19, "sub_chunk_id": 0, "sentences": "Dan Letter: Yeah. Sure. So, we have - we 're seeing continued broad - based demand across all size ranges. Now there certainly are pockets of - in certain markets that there 's some risk and maybe the bulk. And those are markets we 've talked about historically. South Dallas, North Fort Worth, Indianapolis is getting a fair amount of bulk built out. But, and then I would say West Phoenix, as well. But what I would say with our portfolio overall, we 're really isolated from any of this bulk risk and we 're really confident in the demand across all site ranges.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 20, "sub_chunk_id": 0, "sentences": "Operator: Thank you. And your next question comes from Ki Bin Kim with Truist. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 21, "sub_chunk_id": 0, "sentences": "Ki Bin Kim: Thanks. Tom, turning to your capital deployment, $3 billion Blackstone deal at a 5.75 stabilized cap rate. Can you just discuss how you viewed the attractiveness of this deal versus some other opportunities that you might have had such as spot buybacks or development? Or do you simply think the value per square foot, price should n't decrease much further from here on out?", "ground_truth_output": { "entities": [ { "id": 226, "label": "Traditional", "start_offset": 42, "end_offset": 60, "text": "capital deployment", "global_span": [ 22926, 22944 ] }, { "id": 227, "label": "Value", "start_offset": 62, "end_offset": 72, "text": "$3 billion", "global_span": [ 22946, 22956 ] }, { "id": 228, "label": "Traditional", "start_offset": 73, "end_offset": 88, "text": "Blackstone deal", "global_span": [ 22957, 22972 ] }, { "id": 229, "label": "Value", "start_offset": 94, "end_offset": 98, "text": "5.75", "global_span": [ 22978, 22982 ] }, { "id": 230, "label": "Traditional", "start_offset": 99, "end_offset": 118, "text": "stabilized cap rate", "global_span": [ 22983, 23002 ] } ], "relations": [ { "id": 82, "entity_ids": [ 226, 227 ], "description": "Value_of" }, { "id": 83, "entity_ids": [ 228, 229, 230 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 22, "sub_chunk_id": 0, "sentences": "Dan Letter: Yeah. I mean, certainly, portfolios that we would acquire would be at a discount to replacement cost. And replacement costs has moved up tremendously in the last couple of years by virtue of - forget about the land piece, because that 's a squishy piece that 's related to rent and all that. But the construction piece has really, really escalated. So to buy standing inventory in our best markets is always a really great thing that we look at. The quality of the portfolio was quite high, I would say very close to our own portfolio. The percentage that we would dispose of is zero. So it was hand selected to meet our requirements. I would n't call it a steal. We did n't steal anything. I think it 's a market rate transaction and with the upside built into the rents, you know, 8% IRR in a world that I think is going to be a sub 3% inflation rate. And then, all the added things we can put on top of it and with Essentials and all that, I ' ve developed capital at those rates all day long.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 23, "sub_chunk_id": 0, "sentences": "Operator: Your next question comes from Michael Goldsmith with UBS. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 24, "sub_chunk_id": 0, "sentences": "Michael Goldsmith: Good morning. Thanks a lot for taking my question. The lease percentage of the development pipeline has been dropping pretty materially kind of back to 2019 levels. What are the factors there? And does this impact your ability that hate your yields expected on these developments?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 25, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Yeah, I think maybe the best way I ’ll summarize in this call would be, we are back to 2019. Okay. We are getting at it in 25 different ways. But the easiest way to think about it is, demand, supply, rental growth, all of those things that are trending back to 2019 pre - COVID. And if you take ‘ 20 to ‘ 22 out of the picture and imagine, that in 2019, somebody would tell you that in 2023 you are still talking about the dynamics of 2019 market, I would be jumping up and down happy about that. So, that ’s where we are and almost to any question, I am not trying to avoid your question. But it would be the same answer on 20 other parameters, as well. We 're back to 2019.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 26, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Nick Thillman with Baird. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 27, "sub_chunk_id": 0, "sentences": "Nick Thillman: Hey, good morning. Hamid, kind of touched on you guys competing on price by 20% of tenants not renewing because of that. But retention is dropping down to 70%. So, are those tenants are renewing or do they not? Where do they end up going? Do they go to a new supply or a new product that 's being delivered? Or is it more sort of a scenario where they 're just completely priced out of the market?", "ground_truth_output": { "entities": [ { "id": 231, "label": "Traditional", "start_offset": 141, "end_offset": 150, "text": "retention", "global_span": [ 25609, 25618 ] }, { "id": 232, "label": "Value", "start_offset": 171, "end_offset": 174, "text": "70%", "global_span": [ 25639, 25642 ] } ], "relations": [ { "id": 84, "entity_ids": [ 231, 232 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 28, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: No. They go somewhere else. I mean, those are real needs and at the end of the day, warehouse rent is - as a percentage of total logistic cost is relatively small. So they are not going to go out of business because of that. I mean, frankly, the pressure on energy prices, on fuel prices, on labor prices and all that, if you are going to worry about something those are more significant than their ability to pay rent. 70% is not a unusually low retention rate. I mean, if you, again forget about the last three years where there was no space and people had no choice, that would be a very normal rate of retention for us, going back and looking at it over 10, 20 year timeframe. So, and we are trying to find out what the efficient point is for losing customers because of price. We can make that number be zero, but that would not be wise because that means we 're not pushing rents as hard. So, 20% is definitely still below where I would start worrying about dial and get the other way. If it got to about 30%, we may want to moderate on that. But still, generally speaking, the bias is towards pushing rents and not occupancies. Now markets where that is not the case, we ’ll dial it back some. But that 's a decision we make day - to - day based on the data that we see. It ’s not a top down type of decision.", "ground_truth_output": { "entities": [ { "id": 233, "label": "Value", "start_offset": 437, "end_offset": 440, "text": "70%", "global_span": [ 26318, 26321 ] }, { "id": 234, "label": "Traditional", "start_offset": 464, "end_offset": 478, "text": "retention rate", "global_span": [ 26345, 26359 ] } ], "relations": [ { "id": 85, "entity_ids": [ 233, 234 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 29, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Ronald Kamdem with Morgan Stanley. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 30, "sub_chunk_id": 0, "sentences": "Ronald Kamdem: Hey. Just a couple quick ones. Just going back to the market rent growth forecast and also Southern California, can you give us some context in terms of what was the first half growth on the market rent growth? Number one. And then, number two, when you talk about sort of Southern California, decelerating, is there a way to get some context on – is it just a deceleration or should we be bracing for things to potentially turn negative in that market?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 31, "sub_chunk_id": 0, "sentences": "Tim Arndt: So, couple things. First of all, the most important thing about Southern California is the gas in the tank. Not rental growth going forward. I mean the gas in the tank in the Southern California is – I do n’t know the exact number, but it ’s probably over a 100% on your average lease. So, whether you think rents are going to grow 3% or negative 3% or 10% or whatever, it 's not going to affect that number one Iota. Are there markets in Southern California and elsewhere where you could see rental growth sliding? Sure, of course, there are. When something has escalated by 150%, I would n't be surprised if it backslid some. Do I worry about Southern California becoming a difficult market? No. I would like to have more Southern California, because that means we have more cars with more gas in the tank. So, there 's some markets that may continue to escalate, but they 're still not going to be as good as a market that has embedded growth of well over a 100%. So I 'm not trying to duck your question. But we 're a global company, it 's a 1.2 billion square foot portfolio and I think it would not be a productive use of my time or anybody else as your time to drill down into sub - market or individual rents. Because frankly, we do n't spend a lot of time ourselves looking at that. We look at it bottoms up a deal - by - deal. And then, we make our long - term investment decisions based on some macro bets. And what I ' m telling you is that we like Southern California because of its embedded mark - to - market.", "ground_truth_output": { "entities": [ { "id": 235, "label": "Traditional", "start_offset": 322, "end_offset": 327, "text": "rents", "global_span": [ 28112, 28117 ] }, { "id": 236, "label": "Value", "start_offset": 341, "end_offset": 348, "text": "grow 3%", "global_span": [ 28131, 28138 ] }, { "id": 237, "label": "Value", "start_offset": 352, "end_offset": 363, "text": "negative 3%", "global_span": [ 28142, 28153 ] }, { "id": 238, "label": "Value", "start_offset": 367, "end_offset": 370, "text": "10%", "global_span": [ 28157, 28160 ] }, { "id": 239, "label": "Traditional", "start_offset": 932, "end_offset": 938, "text": "market", "global_span": [ 28722, 28728 ] }, { "id": 240, "label": "Traditional", "start_offset": 957, "end_offset": 963, "text": "growth", "global_span": [ 28747, 28753 ] }, { "id": 241, "label": "Value", "start_offset": 979, "end_offset": 983, "text": "100%", "global_span": [ 28769, 28773 ] }, { "id": 242, "label": "Value", "start_offset": 1064, "end_offset": 1082, "text": "1.2 billion square", "global_span": [ 28854, 28872 ] }, { "id": 243, "label": "Traditional", "start_offset": 1083, "end_offset": 1097, "text": "foot portfolio", "global_span": [ 28873, 28887 ] } ], "relations": [ { "id": 86, "entity_ids": [ 235, 236 ], "description": "Value_of" }, { "id": 87, "entity_ids": [ 235, 237 ], "description": "Value_of" }, { "id": 88, "entity_ids": [ 235, 238 ], "description": "Value_of" }, { "id": 89, "entity_ids": [ 239, 240, 241 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 32, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Michael Carroll with RBC Capital Markets. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 33, "sub_chunk_id": 0, "sentences": "Michael Carroll: Yes. Thanks. I guess just direct it to Tim. I believe last quarter that you indicated the 2024 lease expirations had an 85 plus percent mark - to - market. I mean, can you touch on what is included in that estimate? Does that reflects expected market rent growth in 2023? And if so, does that 85% target in stats still hold today?", "ground_truth_output": { "entities": [ { "id": 244, "label": "Traditional", "start_offset": 72, "end_offset": 84, "text": "last quarter", "global_span": [ 29515, 29527 ] }, { "id": 245, "label": "Traditional", "start_offset": 113, "end_offset": 130, "text": "lease expirations", "global_span": [ 29556, 29573 ] }, { "id": 246, "label": "Value", "start_offset": 138, "end_offset": 158, "text": "85 plus percent mark", "global_span": [ 29581, 29601 ] } ], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 34, "sub_chunk_id": 0, "sentences": "Tim Arndt: We would be in the 80s. Let me put it that way right now, and that would contemplate market rent growth from here. So, we feel good about still hitting that kind of number, but we will give full guidance on it later in the year.", "ground_truth_output": { "entities": [ { "id": 247, "label": "Value", "start_offset": 31, "end_offset": 34, "text": "80s", "global_span": [ 29822, 29825 ] }, { "id": 248, "label": "Traditional", "start_offset": 97, "end_offset": 115, "text": "market rent growth", "global_span": [ 29888, 29906 ] } ], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 35, "sub_chunk_id": 0, "sentences": "Chris Caton: Yeah, I do n't think we know anything that suggests a different number than when we told you before. So, so it 's essentially the same number.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 36, "sub_chunk_id": 0, "sentences": "Operator: Your next question comes from Camille Bonnel with Bank of America. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 37, "sub_chunk_id": 0, "sentences": "Camille Bonnel: Good morning. So, to clarify on Hamid ’s comments around the portfolio 's embedded NOI growth, if rents grew another 5% as you 're projecting in the back half of this year, are you expecting core NOI growth to be tracking above that 7% mention or more closely to the growth you projecting this year? And Tim, from your opening remarks, it sounds like market rents have grown in line with expectations to - date but moderated into 2Q. Can you just comment on how the pace of growth looks like for the remainder of the year based on your teams ’ projections?", "ground_truth_output": { "entities": [ { "id": 249, "label": "Traditional", "start_offset": 213, "end_offset": 223, "text": "NOI growth", "global_span": [ 30505, 30515 ] }, { "id": 250, "label": "Value", "start_offset": 250, "end_offset": 252, "text": "7%", "global_span": [ 30542, 30544 ] } ], "relations": [ { "id": 91, "entity_ids": [ 249, 250 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 38, "sub_chunk_id": 0, "sentences": "Tim Arndt: Well, I 'll take the first one. I think I want to be sure we 're not conflating a couple things on same - store. So Hamid ’s illustration earlier was about a four year horizon what we think will unfold in terms of market rent growth. That would be that roughly 8.5% coverage. And I 'll go …", "ground_truth_output": { "entities": [ { "id": 251, "label": "Traditional", "start_offset": 226, "end_offset": 232, "text": "market", "global_span": [ 31091, 31097 ] }, { "id": 252, "label": "Traditional", "start_offset": 238, "end_offset": 244, "text": "growth", "global_span": [ 31103, 31109 ] }, { "id": 253, "label": "Value", "start_offset": 273, "end_offset": 277, "text": "8.5%", "global_span": [ 31138, 31142 ] }, { "id": 254, "label": "Traditional", "start_offset": 278, "end_offset": 286, "text": "coverage", "global_span": [ 31143, 31151 ] } ], "relations": [ { "id": 92, "entity_ids": [ 251, 252, 253, 254 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 39, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: But the average same - store NOI growth, not the rent growth, same - store NOI growth.", "ground_truth_output": { "entities": [ { "id": 255, "label": "Traditional", "start_offset": 46, "end_offset": 56, "text": "NOI growth", "global_span": [ 31213, 31223 ] }, { "id": 256, "label": "Traditional", "start_offset": 86, "end_offset": 102, "text": "store NOI growth", "global_span": [ 31253, 31269 ] } ], "relations": [ { "id": 93, "entity_ids": [ 255, 256 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 40, "sub_chunk_id": 0, "sentences": "Tim Arndt: Sorry.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 41, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: I do n't even have the number for rent growth because frankly, I do n't really spend a lot of - that 's a very volatile number.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 42, "sub_chunk_id": 0, "sentences": "Tim Arndt: Yeah. So, and that number by the way incidentally incorporates what will happen in due confirms of its fair value lease adjustments and what we think will happen in occupancy. So that 's kind of fully baked and that 's a four - year discussion. In terms of this year, there 's going to be very little that could change in any direction on market rents that would affect this year 's same - store growth. Just too much of the lease mark - to - market and the year frankly are now baked that we 're going to land pretty tightly in the range that I …", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 43, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: For next years.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 44, "sub_chunk_id": 0, "sentences": "Tim Arndt: Yeah, true.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 45, "sub_chunk_id": 0, "sentences": "Chris Caton: And then as it relates to the rent growth detailed, Tim ’s script included a way for you to kind of reconcile that. And I think within the numbers, the main thing to know is, many It 's both in the US and globally continued to have really healthy pricing power and meaningful move in market rents, but the aggregate number is adjusted downward based on the disease on Southern California that we ' ve discussed here.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 46, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from John Kim with BMO Capital Markets. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 47, "sub_chunk_id": 0, "sentences": "John Kim: Thank you. Just a follow - up on the $3 billion acquisition you made. How much of that did it contribute to your full - year guidance raise if at all? And can you comment on the pricing just given, 4% going in cap rate, not many buyers have Prologis use cost of capital. So I was wondering how you came to that level and how many competing bids or buyers there were at that level?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 48, "sub_chunk_id": 0, "sentences": "Tim Arndt: Yeah, I 'll pick up on the on the earning side. It 's about a $0.05 roughly of our are raise would be attributable to that. The remainder would be the same - store component.", "ground_truth_output": { "entities": [ { "id": 257, "label": "Traditional", "start_offset": 46, "end_offset": 58, "text": "earning side", "global_span": [ 33009, 33021 ] }, { "id": 258, "label": "Value", "start_offset": 74, "end_offset": 79, "text": "$0.05", "global_span": [ 33037, 33042 ] }, { "id": 259, "label": "Traditional", "start_offset": 99, "end_offset": 104, "text": "raise", "global_span": [ 33062, 33067 ] } ], "relations": [ { "id": 94, "entity_ids": [ 257, 258, 259 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 49, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Yeah. And on the number of competing buyers and all that, we do n't know but we actually work collaboratively with the seller to pick a portfolio that makes sense for them and make sense for us. So it was n't like there was a package and a competitive environment. But look, I would argue that two of the largest players in this space kind of know what 's going on in the market and they do n't need to know a lot of third - party validation of where pricing is. And we came to an agreement reasonably quickly on that. So, we 're really pleased about it because we do n't have to go through the brain damage of cleaning up the portfolio. We bought what we wanted to buy at the price that we wanted to buy and presumably they got the price that they wanted. And everybody was very happy about that and we 'd love to do more of that.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 50, "sub_chunk_id": 0, "sentences": "Operator: The next question comes from Nicholas Yulico with Scotiabank. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 51, "sub_chunk_id": 0, "sentences": "Nicholas Yulico: Thanks. Just a question in terms of, what you 're seeing with activity in the 3PL space. I mean, some commentary we were specifically about, LA and 3PL was that it was a market very tight to tenants took as much spaces they could get. In many cases took some excess space in recent years. And now that those same tenants in some cases are putting sublease space on the markers and then you also have less demand from the user group. Maybe it 's a port issue in the near term. But I guess I ' m just wondering, broadly on 3PL what the activity of that tenant base looks like in - across your portfolio?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 52, "sub_chunk_id": 0, "sentences": "Chris Caton: Yeah, I ' m going to make a general comment and it applies maybe a bit more to 3PLs, but it applies to everybody. Southern California is a market were embedded mark - to - market is well over 100%. The 3PL business is a very low margin business. Very thin margin business. If you ' ve taken ten percent more space than you would needed and now with the changed outlook you think you need 10% less than you need it before that 's a 20% swing in how much space you 're going to need the over the over the longer term. If you can make three or four x what you would make at a year - in a year, moving boxes around by subleasing that space, you would do that. So, the propensity to adjust your space to your needs is much greater in this cycle because of this significant mark - to - market that 's in better than some of these leases. Now, if you 're in a market where - and I ca n't think of a market like that. But let 's say you were in a market where you 're essentially a market or 10% below, by the time you pay a leasing commission and encourage the downtime and maybe put some TI 's in the space, you 're not going to make money on that space. So it 's more of a cost avoidance and therefore not much of that happens. Southern California is actually viewed as a source of profit for these guys to sublease their real estate. So they 're going to do it much quicker than before and that 's in fact what we ’ ve seen. So and - it all goes back to having less than 1% vacancy in this market not too long ago. So, look, Southern California has been a crazy rent growth market for the for as long as I remember, whether you look at 30 years or five years or three years, but the last three years have been have just been ridiculous. And for anybody to think that that would continue forever, I - we certainly do n't make our investment decisions based on that and we do n't operate our portfolio like that. So, we 're not surprised about what 's going on in Southern California.", "ground_truth_output": { "entities": [ { "id": 260, "label": "Value", "start_offset": 1477, "end_offset": 1489, "text": "less than 1%", "global_span": [ 36197, 36209 ] }, { "id": 261, "label": "Traditional", "start_offset": 1490, "end_offset": 1512, "text": "vacancy in this market", "global_span": [ 36210, 36232 ] } ], "relations": [ { "id": 95, "entity_ids": [ 260, 261 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 53, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Vikram Malhotra with Mizuho. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 54, "sub_chunk_id": 0, "sentences": "Vikram Malhotra: Thanks for taking the question. There is do two questions. One, just looking at the lease proposal chart, correct me if I ' m wrong, I think this is all in square feet and I ' m just wondering how this would compare, whether you look at it as a percent of expirations or the portfolio just because you 're a much bigger portfolio today with Duke in there and other acquisitions. So as a percent of the portfolio is, there something unique in terms of the trend downward it would seem as a percentage it 's probably much lower. So if you clarify that number one. And then, just number two, bigger picture, Hamid, if you 're talking about normalization in trends to still healthy levels but that 's just in normalizing to 2019. Where do you think the risk premium should be for public private warehouse space? Should it be higher? Is it fair as it is today? Thanks.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 55, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Yeah, let me start with that. In 2009, there was a big difference between now and 2019. 2019, I do n’t remember the exact number, but I think vacancy rates were north of 5%, maybe even north of 6%. Today and the outlook in 2019 was that we had a long run of improving market conditions and I think as calls like this we are all worrying about for the sixth year in a row whether supply would exceed demand okay? That today - it 's a same market except the vacancy rates are substantially lower than they were at that time. And we have less of a concern about supply beyond this year that is than we had in 2019. So, it 's a slightly different market but the dynamics are not that unusual. With respected public to private, I continue to believe that - I do n't know about the sector, but I continue to believe that we trade at a modest discount to NAV and private values. And I think once capital flows start up again, once the denominator effect starts going the other way because of improvements in public markets, I think that will be validated. So, I do think private values in general are slightly higher than public values where these companies are priced.", "ground_truth_output": { "entities": [ { "id": 262, "label": "Traditional", "start_offset": 105, "end_offset": 109, "text": "2019", "global_span": [ 37802, 37806 ] }, { "id": 263, "label": "Traditional", "start_offset": 159, "end_offset": 172, "text": "vacancy rates", "global_span": [ 37856, 37869 ] }, { "id": 264, "label": "Traditional", "start_offset": 178, "end_offset": 183, "text": "north", "global_span": [ 37875, 37880 ] }, { "id": 265, "label": "Value", "start_offset": 187, "end_offset": 189, "text": "5%", "global_span": [ 37884, 37886 ] }, { "id": 266, "label": "Traditional", "start_offset": 202, "end_offset": 207, "text": "north", "global_span": [ 37899, 37904 ] }, { "id": 267, "label": "Value", "start_offset": 211, "end_offset": 213, "text": "6%", "global_span": [ 37908, 37910 ] } ], "relations": [ { "id": 96, "entity_ids": [ 262, 263, 264, 265 ], "description": "Value_of" }, { "id": 97, "entity_ids": [ 262, 263, 264, 266, 267 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 56, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: And then Vikram on the proposal volumes, yes as square footage and as to reconciling it I 'd point you to the answer earlier to the same question and happy to go through it offline if that 's not sufficient for you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 57, "sub_chunk_id": 0, "sentences": "Operator: Thank you. And our next question comes from Todd Thomas with KeyBanc Capital Markets. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 58, "sub_chunk_id": 0, "sentences": "Todd Thomas: Hi, thanks. Just the number one on market rent growth. You ' ve previously talked about a 300 to 500 basis points spread in market rent growth between coastal and non - coastal markets. In light of your comments around Southern California, can you just talk about how you expect that spread to trend as you look ahead to 2024? And are there other coastal markets that you would include in the discussion with Southern California as you think about the labor strikes and the impact that that 's having at the ports?", "ground_truth_output": { "entities": [ { "id": 268, "label": "Value", "start_offset": 104, "end_offset": 127, "text": "300 to 500 basis points", "global_span": [ 39342, 39365 ] }, { "id": 269, "label": "Traditional", "start_offset": 128, "end_offset": 198, "text": "spread in market rent growth between coastal and non - coastal markets", "global_span": [ 39366, 39436 ] } ], "relations": [ { "id": 98, "entity_ids": [ 268, 269 ], "description": "Value_of" } ] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 59, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Yeah, I want to be clear about what we said. If you look at all the markets that we operate in, Southern California is going to have the highest rent growth of all, not market rent growth, maybe the market rent growth will modulate, but because of the mark - to - market Southern California for the foreseeable future. And by that, I mean five years plus is going to have the highest growth rate of any market that I can think of five. Chris, do you?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 60, "sub_chunk_id": 0, "sentences": "Chris Caton: Yes, 100%.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 61, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Yeah, and that can go on literally for five to ten years. So, because the mark - to - market is so huge. Now, in terms of the market rent growth, I do n't know, we 'll find out, but it 's our view has moderated. But that really does n't matter. It 's kind of like adding 2% to 3% in one direction or the other to a number that 's north of 100% percent. So I think we 're focusing on the wrong issues. I do n't I do n't really know the answer to your question. If I did I ’d tell you.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 62, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Anthony Powell with Barclays. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 63, "sub_chunk_id": 0, "sentences": "Anthony Powell: Hi, good morning. Just a question on contributions. It looks like you restarted in this quarter with Japan, and Mexico. Is there still to plan to restart contributions in the US or Europe later this year. And how – how they 're progressing overall?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 64, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Yeah, I ’ll start it and pitch it over to Chris then. Look, the reason we stopped contribution is not because we did n't have the capacity to buy these assets in our funds, we did because they 're very low leveraged. The reason we did is that we could n't really look our investors in the eyes and say that we all have clarity around the values for the fund, for – for the properties that are being contributed. So we 're not in a rush to do that. There were some companies that force these decisions back in the last cycle that that - and we did n't, and we fared much better than those companies that force, - forced the contributions. So as long as there is clarity on valuations, we will contribute assets at least we would be willing to contribute assets. But I remind all of you, at the end of the day, the independent advisory board for each fund makes a decision of whether they want to accept those contributions or not. It 's not a must put, must take kind of a situation at all. So, but, we could n't very much look them in the eyes and say that this is the value because there was uncertainty around it. In the markets that you mentioned, there is clarity around the values. Europe, we felt that it reached a point of clarity at the end of last quarter and we believe the U.S. is not becoming very clear too. And the whole process took about three quarters from the downturn, which is what we expected this to say based on experience. So you should expect contributions to continue at the sort of a normal or maybe somewhat modulated pace.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 65, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Michael Mueller with - go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 66, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Caton, do you have anything to add to that?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 67, "sub_chunk_id": 0, "sentences": "Chris Caton: No, I think that 's right. I mean, we will probably look at contributions in Q4. No rush as you said going through that ordinary course of business and split it between both in Europe and the US.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 68, "sub_chunk_id": 0, "sentences": "Operator: Thank you. And our next question from Mike Mueller with JP Morgan. Please go ahead.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 69, "sub_chunk_id": 0, "sentences": "Mike Mueller: Okay. Thanks. I guess following up on that contribution question, are you seeing any traction yet in the third quarter with dispositions?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 70, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: We are not trying to dispose of a whole lot because remember, we 're almost through all the liberty ones and Duke had very little dispositions associated with. We sold a couple of them of late and the latest Blackstone portfolio has zero dispositions in it. So, I mean, other than the normal sort of Bluebird dispositions we 're kind of reaching the end of cleaning up the portfolio. There are few deals here and there, but then what would you add to that?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 71, "sub_chunk_id": 0, "sentences": "Chris Caton: I would say the transaction market is opening up and we 're very confident. We 're going to be able to dispose of what we want when we want.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 72, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: But it 's not a material amount. It ’s not going to move the need on our company.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 73, "sub_chunk_id": 0, "sentences": "Operator: Next question comes from Craig Mailman with Citi. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 74, "sub_chunk_id": 0, "sentences": "Nick Joseph: Thanks actually, Nick Joseph here with Craig. Just going back to the comment you made earlier on the Blackstone portfolio deal you said you worked with the seller, kind of what would work the both sides and obviously they are lot clearly there was a lot to choose from. So, what were you focused on, is there from a portfolio or strategic perspective in terms of the assets you ’ ve acquired?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 75, "sub_chunk_id": 0, "sentences": "Tim Arndt: Well, the markets that we like in the long term. And I can tell you that during the course of those that analysis and that thinking, what the market rent is going to do in the next six months to the last decimal point was not a consideration. I mean, it ’s - those are markets that we really believe based on daily interactions with customers as to where demand is going to be where we see that trends in supply which are by the way let ’s, we have n't talked about that in a couple of quarters. But Supply is becoming extremely difficult to bring online in places like California. In fact, I ' m kind of worried about it because some of these places are shutting down. I mean, we spent a lot of time with the legislature trying to defeat A B 1,000 which was a proposal to basically stop all warehouse development in Southern California. So in selecting those assets we focused on the markets that we liked a lot and we were prepared to pay - accept a lower yield for those markets because they have more embedded growth.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 76, "sub_chunk_id": 0, "sentences": "Operator: Our next question comes from Jamie Feldman with Wells Fargo. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 77, "sub_chunk_id": 0, "sentences": "Jamie Feldman: Thank you and thanks for taking my question. So, I want to get your thoughts on just the different regions coming out of what should be a recession if we get a recession. There 's a lot of talk about European wages really lagging the U.S. obviously, that 's a big driver of retail spending in your business. Can you just talk about what might be different as you think about putting capital to work across Europe, Asia and the US or North America given what, might some of these macro trends we 're seeing?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 78, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Yeah. U.S. has got the highest rent growth over time of any of these markets because it 's a more dynamic economy, bigger GDP growth I think than Europe certainly. But Europe has always been a sort of more muted market in terms of supply. Vacancy rates are always lower in Europe and land is metered out by usually government authorities. It ’s not so much of a free market. You go buy from the former land. So, it 's a more muted growth pattern than the US one. But we mitigate that because we employ more of a fund structure in Europe. So the combination of the earnings on the fund management business plus the growth in the underlying real estate business makes up for the - makes up for that difference. Asia, China used to be a powerhouse in terms of economic growth. It frankly has surprised everybody coming out of it with respect to how slow it 's been to turnaround. I ' m not smart enough to know whether that 's a, that 's a long - term trend, or a short - term trend. But that market has gone from basically 10% per year type of GDP growth to more like a 5% rate of growth. Japan, probably the best long - term market for us, from a development point of view has always had low rent growth. 1% to 2% rent growth would be great. But boy!! there 's no CapEx. There 's no turnover. There is, - and yields have maintained themselves in Japan, better than anywhere else. There 's been no cap rate expansion in Japan at all. And remember, there 's hardly any mark - to - market. So there is no cap rate expansion. And in fact, I would say there 's probably 10, 15 basis points of compression in the last 12 months. So it 's a good development market and from an operating point of view, we talk cap rates. But at the end of the day, the cash flows in Japan are very strong. There 's very little of it leaks out to CapEx and other things. So, each market is different and each market when you look at it as a portfolio plays its role within our overall business.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 79, "sub_chunk_id": 0, "sentences": "Operator: Thank you. And our final question for today comes from Camille Bonnel with Bank of America. Please state your question.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 80, "sub_chunk_id": 0, "sentences": "Camille Bonnel: Hi. Thanks for taking my question. Does the valuation of your USLF fun take into account the recent portfolio acquisition you announced or is that more of a comp for next quarter?", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 81, "sub_chunk_id": 0, "sentences": "Hamid Moghadam: Good question, Camille. I do n't know. We bought that portfolio on balance sheet. So it 's not a fund investment, so. But I honestly do n't know how long it 's going to take the appraisers to reflect that. But it 's - we bought it at the very consistent level of valuation to what we thought valuations would be this quarter. And I think we were right about that. So I think the market has adjusted in terms of understanding where values are going, I think we 're at the tail end of those adjustments. You were the last question Camille. So thank you all for your interest in the company. We certainly feel very good about our business going forward. And hope that we will have the opportunity to speak to you more over the summer. Thank you, everyone.", "ground_truth_output": { "entities": [], "relations": [] } }, { "symbol": "PLD", "quarter": 2, "year": 2023, "date": "2023-07-18 17:10:18", "chunk_id": 82, "sub_chunk_id": 0, "sentences": "Operator: Thank you. And that concludes today 's conference of parties. All parties may disconnect. Have a good day.", "ground_truth_output": { "entities": [], "relations": [] } } ]