Q3 2023 IQVIA Holdings Inc Earnings Call

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Speaker 2: Ladies and gentlemen, thank you for standing by. At this time, I would like to welcome everyone to the IQVIA third quarter 2023 earnings conference call. All lines have been placed on mute to prevent any background.

Ladies and gentlemen, thank you for standing by at this time I would like to welcome everyone to the I Q V. At third quarter 20 twenty-three earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question. During this time.

After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. As a reminder, this call is being recorded. Thank you. I would now like to turn the call over to Nick Childs, Senior Vice President, Investor Relations and Treasury. Mr. Childs, please begin your conference.

Speaker 2: After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone t-pad. If you would like to withdraw your question, press star one again. As a reminder, this call is being recorded. Thank you. I would now like to turn the call over to Nick Childs, Senior Vice President, Investor Relations and Treasury. Mr. Childs, please begin your conversation.

Plea price star followed by the number one on your telephone keypad. If you would like to withdraw your question price started one again as a reminder, this call is being recorded. Thank you I would now like to turn the call over to Nick Childs Senior Vice President Investor Relations and Treasury. Mr. Childs Police began your conference.

Operator: I would now like to turn the call over to Nick Childs, Senior Vice President, Investor Relations and Treasury. Mr. Childs, please begin your conference. Thank you, Regina, and good morning, everyone. Thank you for joining our Q3 2023 earnings call. With me today are Ari Bousbib, Chairman and Chief Executive Officer; Ron Bruehlman, Executive Vice President and Chief Financial Officer; Eric Sherbet, Executive Vice President and General Counsel; Mike Fedok, Senior Vice President, Financial Planning and Analysis; and Gustavo Peron, Senior Director, Investor Relations. Today, we'll be referencing a presentation that will be visible during this call for those of you on our webcast. This presentation will also be available following this call in the Events and Presentations section of our IQVIA Investor Relations website at ir.iqvia.com.

Nick Childs: Thank you, Regina, and good morning, everyone. Thank you for joining our Q3 2023 earnings call. With me today are Ari Bousbib, Chairman and Chief Executive Officer; Ron Bruehlman, Executive Vice President and Chief Financial Officer; Eric Sherbet, Executive Vice President and General Counsel; Mike Fedok, Senior Vice President, Financial Planning and Analysis; and Gustavo Peron, Senior Director, Investor Relations. Today, we'll be referencing a presentation that will be visible during this call for those of you on our webcast.

Speaker 3: Thank you, Regina, and good morning, everyone. Thank you for joining our third quarter, 2023 earnings call. With me today are Ari Buzbi, Chairman and Chief Executive Officer, Ron Brumman, Executive Vice President and Chief Financial Officer, Eric Sherbet, Executive Vice President and General Counsel, Mike Fedock, Senior Vice President, Financial Planning and Analysis, and Gustavo Perone, Senior Director and Investor Relations.

Thank you Regina and good morning, everyone. Thank.

Thank you for joining our third quarter, 20th twenty-three earnings call with me today.

<unk>, Chairman and Chief Executive Officer, <unk>, Executive Vice President and Chief Financial Officer, Eric Sherbet, Executive Vice President and General Counsel, Mike <unk> Senior Vice President financial planning and analysis, and Gustavo Perone Senior director Investor Relations.

Mmm.

Speaker 3: Today we will be referencing a presentation that will be visible during this call for those of you on our webcast. This presentation will also be available following this call in the events and presentation section of our IQVIA Investor Relations website at ir.icuvia.com.

They will be referencing a presentation that will be visible during this call for those of you on our webcast. This presentation will also be available following this call and the events and presentations section of our I Q via Investor Relations website at I R Dot <unk> Dot com.

Nick Childs: This presentation will also be available following this call in the Events and Presentations section of our IQVIA Investor Relations website at ir.iqvia.com. Before we begin, I would like to caution listeners that certain information discussed by management during this conference call will include forward-looking statements.

Operator: Before we begin, I would like to caution listeners that certain information discussed by management during this conference call will include forward-looking statements. The actual results could differ materially from those stated or implied by forward-looking statements due to risks and uncertainties associated with the company's business, which are discussed in the company's filings with the Securities and Exchange Commission, including our annual report on Form 10-K and subsequent SEC filings. In addition, we will discuss certain non-GAAP financial measures on this call, which should be considered a supplement to and not a substitute for financial measures prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to the comparable GAAP measures is included in the press release and conference call presentation. I would now like to turn the call over to our Chairman and CEO. Thank you, Nick, and good morning, everyone.

Before we begin I would like to caution listeners that certain information discussed by management. During this conference call will include forward looking statements.

Speaker 3: Before we begin, I would like to caution listeners that certain information discussed by management during this conference call will include forward-looking statements.

The actual results could differ materially from those stated or implied by forward-looking statements due to risks and uncertainties associated with the company's business, which are discussed in the company's filings with the Securities and Exchange Commission, including our annual report on Form 10-K and subsequent SEC filings. In addition, we will discuss certain non-GAAP financial measures on this call, which should be considered a supplement to and not a substitute for financial measures prepared in accordance with GAAP.

Speaker 3: The actual results could differ materially from those stated or implied by forward-looking statements due to risks and uncertainties associated with the company's business, which are discussed in the company's filings with the Securities and Exchange Commission, including our annual report on Form 10-K and subsequent SEC filings.

The actual results could differ materially from those stated or implied by forward looking statements do do risks and uncertainties associated with the company's business, which are discussed in the company's filings with the Securities and Exchange Commission, including our annual report on Form 10-K, and subsequent S. A.

C filings.

Speaker 3: In addition, we will discuss certain non- GAAP financial measures on this call, which should be considered a supplement two, and at a substitute four, financial measures prepared in accordance with GAP. A reconciliation of these non- GAAP measures to the comparable GAAP measures is included in the press release and conference call presentation.

Edition, we will discuss certain non-GAAP financial measures on this call what should be considered a supplement to and not a substitute for financial measures prepared in accordance with gas.

A reconciliation of these non-GAAP measures to the comparable GAAP measures is included in the press release and conference call presentation. I would now like to turn the call over to our Chairman and CEO.

A reconciliation of these non-GAAP measures to the comparable GAAP measures is included in the press release and conference call presentation.

Speaker 3: I would now like to turn the call over to our chairman and CEO .

I would now like to turn the call over to our chairman and C E O.

Ari Bousbib: Thank you, Nick, and good morning, everyone.

Speaker 4: Thank you, Nick, and good morning, everyone. Thank you for joining us today to discuss our third quarter results.

<unk> good morning, everyone. Thank you for joining us today to discuss our third quarter results.

Operator: Thank you for joining us today to discuss our Q3 results. In line with our expectations, R&DS is performing very well. The TAS business continued to grow, but revenue fell short of what we had expected. About half of our total revenue shortfall came from foreign exchange headwinds versus our previous guidance, and the other half from persistent weakness in demand in the TAS segment. Despite the TAS revenue shortfall, our productivity actions allowed us to deliver on our profit guidance. We continue to receive questions about the health of the industry and customer demand, and I'd like to give you the latest of what we're seeing in the market. Let's start on the clinical development side. Demand in the R&DS segment remains strong. Net new bookings exceeded $2.6 billion, representing a quarterly book-to-bill of 1.24 overall, including passthroughs.

Thank you for joining us today to discuss our Q3 results. In line with our expectations, R&DS is performing very well. The TAS business continued to grow, but revenue fell short of what we had expected. About half of our total revenue shortfall came from foreign exchange headwinds versus our previous guidance, and the other half from persistent weakness in demand in the TAS segment. Despite the TAS revenue shortfall, our productivity actions allowed us to deliver on our profit guidance.

Speaker 4: The online with our expectations R&D is performing very well. The task business continued to grow but revenue fell short of all we had expected. About half of our total revenue shortfall came from foreign exchange headwinds versus our previous guidance.

Eli with our expectations are India's is performing very well.

Taz business continued to grow but revenue fell short of what we had expected about half of our total revenue shortfall came from foreign exchange headwinds versus all previous guidance.

Speaker 4: and the other half from persistent weakness in demand in the TAZ segment.

And the other half from persistent weakness in demand in the Taz segment.

Speaker 4: Despite the TAS revenue shortfall, our productivity actions allowed us to deliver on our profit guidance.

Despite the task rather new short for all productivity actions allowed us to deliver on our profit guidance.

We continue to receive questions about the health of the industry and customer demand, and I'd like to give you the latest of what we're seeing in the market. Let's start on the clinical development side. Demand in the R&DS segment remains strong. Net new bookings exceeded $2.6 billion, representing a quarterly book-to-bill of 1.24x overall, including passthroughs.

Speaker 4: We continue to receive questions about the health of the industry and customer demand. And I'd like to give you the latest of what we're seeing in the market.

We continue to receive questions about the health of the industry and customer demand and I'd like to give you the latest of what we're seeing in the market.

Speaker 4: Let's start on the clinical development side. Demand in the R&DS segment remains strong. Net new bookings exceeded $2.6 billion, representing a quarterly book to bill of 124.

Let's start on the clinical development side demand in the R&D is segmented remains strong net new bookings exceeded $2.6 billion, representing a call to the book to Bill of 124.

Speaker 4: overall, including pastures, and given that this quarter there is a significant difference between services bookings and bookings with pastures, I note that our services bookings were the highest ever at $2.3 billion, resulting in a 1.4 services book to build.

Overall, including pass throughs and given that <unk> there is a significant difference.

Operator: Given that this quarter, there is a significant difference between services bookings and bookings with passthrough, I note that our services bookings were the highest ever at $2.3 billion, resulting in a 1.4 services book-to-bill. Our backlog reached $28.8 billion, growing 11.7% versus prior year, another historic high. Our quarterly RFP flow was up 10% year over year, with growth across all customer segments. Our strong performance is supported by continued healthy market dynamics. Emerging biotech funding was strong in the quarter. According to BioWorld, Q3 EBP funding was $18.7 billion, the largest quarter this year. Year-to-date, EBP funding through Q3 was up 8% versus prior year. If you look at the first half, large pharma R&D spend, it was above 20% of net revenues, highlighting continued strong R&D activity within large pharma as well. Based on these indicators, the clinical trial industry remains healthy.

Given that this quarter, there is a significant difference between services bookings and bookings with passthrough, I note that our services bookings were the highest ever at $2.3 billion, resulting in a 1.4x services book-to-bill. Our backlog reached $28.8 billion, growing 11.7% versus prior year, another historic high. Our quarterly RFP flow was up 10% year over year, with growth across all customer segments. Our strong performance is supported by continued healthy market dynamics.

<unk> service is bookings and bookings we've passed through.

Note that our services bookings were the highest ever.

At $2.3 billion, resulting in a 1.4 services book to Bill.

Speaker 4: Our backlog reached $28.8 billion, growing 11.7% versus prior year, another historic high.

Our backlog reached $28.8 billion growing 11.7% versus brought your year another historic hi.

Speaker 4: Our quarterly RFP flow was up 10% year over year with growth

<unk> was up 10% year over year with growth across all customer segments.

Speaker 4: Our strong performance is supported by continued healthy market dynamics.

How strong performance is supported by continued healthy market dynamics emerging bye you take funding was strong in the quarter according to value world.

Emerging biotech funding was strong in the quarter. According to BioWorld, Q3 EBP funding was $18.7 billion, the largest quarter this year. Year-to-date, EBP funding through Q3 was up 8% versus prior year. If you look at the first half, large pharma R&D spend, it was above 20% of net revenues, highlighting continued strong R&D activity within large pharma as well. Based on these indicators, the clinical trial industry remains healthy.

Speaker 4: Emerging biotech funding was strong in the quarter. According to BioWorld, third quarter EBP funding was $18.7 billion. The largest quarter this year. Year to date, EBP funding through Q3 was up 8% versus prior year.

<unk> EVP funding was $18.7 billion.

Largest quarter. This year you are to date EVP founding funeral Q3 was up 8% versus draw your your.

Speaker 4: If you look at the first half, large former R&D spend, it was above 20% of net revenues, highlighting continued strong R&D activity within large former as well.

If you look at the first half large format R&d's spend it was above 20% of net revenues highlighting continued strong R&D activity within last farmer as well.

Speaker 4: Based on these indicators, the clinical trial industry remains healthy. Our strong market position, market wins, scale, and differentiated offerings give us confidence that our INDS business will continue to deliver above market growth.

Based on these indicators Guinea <unk> industry remains healthy.

Operator: Our strong market position, market wins, scale, and differentiated offerings give us confidence that our R&DS business will continue to deliver above market growth. Turning now to TAS. On the commercial side of our business, we are obviously facing a tougher macro environment. Our clients remain cautious with their spending and have extended their decision-making timelines beyond what we would have normally expected. I'm sure you also saw that several large pharma have announced significant cost reduction programs, and obviously, we are a significant vendor to large pharma. Now, we had anticipated to see improvements as we progressed through the year, and specifically in the quarter, we usually see activity pick up in September after the slower July, August, summer months. It didn't happen.

Our strong market position, market wins, scale, and differentiated offerings give us confidence that our R&DS business will continue to deliver above market growth. Turning now to TAS. On the commercial side of our business, we are obviously facing a tougher macro environment. Our clients remain cautious with their spending and have extended their decision-making timelines beyond what we would have normally expected.

Our strong market position market wins scale and differentiated offerings give us confidence that our orange D. As business will continue to deliver.

<unk> market growth.

Speaker 4: Turning now to Taz. On the commercial side of our business, we are obviously facing a tougher macro environment.

Turning now to Taz on the commercial side of our business. We are obviously facing a tougher micro environment.

Speaker 4: our clients remain cautious with their spending and have extended their decision-making timelines beyond what we would have normally expected.

Our clients remain cautious with their spending and.

And it has extended the decision making timelines beyond what we would have normally expected.

I'm sure you also saw that several large pharma have announced significant cost reduction programs, and obviously, we are a significant vendor to large pharma. Now, we had anticipated to see improvements as we progressed through the year, and specifically in the quarter, we usually see activity pick up in September after the slower July, August, summer months. It didn't happen.

Speaker 4: I'm sure you also saw that several large farmers have announced significant cost reduction programs and obviously we are a significant vendor to large farmers.

I'm sure you also saw that several large farmer have announced significant cost reduction programs.

And obviously, we are as significant vendor to lodge farmer.

Speaker 4: Now we had anticipated to see improvements as we progress through the year, specifically in the quarter, we usually see activity pick up in September after the slower July , August , summer months.

Now we had anticipated to see improvements as we progress through the euro specific reading a quarter.

We usually see activity pick up in September after the slower July August summer months.

It didn't happen.

Speaker 4: While we still had growth for the segment as a whole, we experienced further declines in our analytics and consulting business.

Operator: While we still had growth for the segment as a whole, we experienced further declines in our analytics and consulting business, somewhat slower than expected growth in the discretionary parts of our real-world business, as well as some impact from the China situation. While the acceleration we are anticipating is taking longer than expected, based on our pipelines, we remain confident that there will be a rebound in demand sometime in 2024. We know this because the pipeline of opportunities remains strong even as decision timelines are elongated and negotiations with our customers have become more difficult. We also know this because historically, going back 25 years, every time there was a pullback in spend on the commercial side, the industry adapts and comes back within a year or two. With this as context, let's now review the Q3 results.

While we still had growth for the segment as a whole, we experienced further declines in our analytics and consulting business, somewhat slower than expected growth in the discretionary parts of our real-world business, as well as some impact from the China situation. While the acceleration we are anticipating is taking longer than expected, based on our pipelines, we remain confident that there will be a rebound in demand sometime in 2024.

Why do we still have growth for the segment as a whole we.

We experienced further declines you know on the let's extend consulting business.

Speaker 4: somewhat slower than expected growth in the discretionary parts of a real-world business.

Somewhat slower than expected growth in the discretionary parts of our real world business.

Speaker 4: as well as some impact from the China situation.

As well as some impact from the China situation.

Speaker 4: While the acceleration we are anticipating is taking longer than expected.

Why the acceleration we are anticipating is taking longer than expected.

Speaker 4: based on our pipelines. We remain confident that there will be a rebound and demand sometime in 2024. We know this because the pipeline of opportunities remains strong even as decision timelines are elongated and negotiations with our customers have become more difficult.

Based on our pipelines, we remain confident that there will be a rebound in demand sometime in 2024, we know this because the pipeline of opportunities remains strong even as decision timelines are elongated.

We know this because the pipeline of opportunities remains strong even as decision timelines are elongated and negotiations with our customers have become more difficult. We also know this because historically, going back 25 years, every time there was a pullback in spend on the commercial side, the industry adapts and comes back within a year or two. With this as context, let's now review the Q3 results.

And negotiations with our customers have become more difficult.

Speaker 4: We also know this because historically, going back 25 years, every time there was a pullback in spend on the commercial side, the industry adapts and comes back within a year or two.

We also know these because he's story going back 25 years every time there was a fall back in spend on the commercial side.

In the street at depths and comes back within a year or two.

With this is complex list now review the third quarter results revenue for the third quarter grew 4.9% on the reported basis, 4.1% at constant currency compared to last year and excluding <unk> related work from both periods.

Speaker 4: With this at context, let's now review the third quarter results. Revenue for the third quarter grew 4.9% on a reported basis, 4.1% at constant current.

Operator: Revenue for the Q3 grew 4.9% on a reported basis, 4.1% at constant currency. Compared to last year, and excluding COVID-related work from both periods, we grew the top line approximately 8.5% on a constant currency basis, and that includes approximately a point and a half of contribution from acquisitions. Q3 Adjusted EBITDA increased 9.1%, driven by revenue growth and ongoing cost management discipline. Q4 Adjusted Diluted EPS of $2.49 faced the ongoing headwind of the step-up in interest expense and the UK corporate tax rate. If you exclude the impact of these non-operational items, our Adjusted Diluted EPS growth underlying was 13%. Let me share a few highlights of business activity in the quarter, and let me start with TAS. This quarter, IQVIA was awarded several noteworthy analytics contracts to support our clients' go-to-market strategies.

Revenue for the Q3 grew 4.9% on a reported basis, 4.1% at constant currency. Compared to last year, and excluding COVID-related work from both periods, we grew the top line approximately 8.5% on a constant currency basis, and that includes approximately a point and a half of contribution from acquisitions. Q3 Adjusted EBITDA increased 9.1%, driven by revenue growth and ongoing cost management discipline.

Speaker 4: Compared to last year and excluding COVID related work from both periods, we grew the top line approximately 8.5% on a constant currency basis.

We grew the top line approximately 8.5% on a constant currency basis.

Speaker 4: And that includes approximately a point and a half of contribution from acquisition.

And that includes approximate you point and a half of contribution from acquisitions.

Speaker 4: Third quarter adjusted EBDA increased 9.1%. Driven by revenue growth and ongoing cost management discipline.

Third quarter, adjusted EBITDA increased 9.1% driven by revenue growth and ongoing cost management discipline.

Q4 Adjusted Diluted EPS of $2.49 faced the ongoing headwind of the step-up in interest expense and the UK corporate tax rate. If you exclude the impact of these non-operational items, our Adjusted Diluted EPS growth underlying was 13%. Let me share a few highlights of business activity in the quarter, and let me start with TAS. This quarter, IQVIA was awarded several noteworthy analytics contracts to support our clients' go-to-market strategies.

Speaker 4: Codecore adjusted diluted EPS of $2.49 faced the ongoing headwind of the step-up in interest expense and the UK corporate tax rate. If you exclude the impact of these non-apparational items, our adjusted diluted EPS growth underlying was 13%.

<unk> adjusted diluted EPS of $2.49 faced the ongoing headwind of the step up in interest expense.

And the UK corporate tax rate you should exclude the impact of he's not operational items are adjusted diluted EPS growth underlying was 13%.

Speaker 4: Let me share a few highlights of business activity in the core. And let me start with Taz.

Let me share a few highlights of business activity in the court and let me start with Taz. These.

Speaker 4: This quarter, IQVIA was awarded seven noteworthy analytics contracts to support our clients' go-to-market strategies. For example,

<unk> <unk> was awarded several noteworthy analytics contracts to support our clients go to market strategies for example.

Operator: For example, an EBP client selected IQVIA to provide analytics around key prescriber and payer trend for their women's health products. In another significant win this quarter, IQVIA secured a large US data analytics contract with a top 10 pharma client that had been buying from a competitor for over a decade. We also received an award from an EBP client to support the launch of their first branded product into the diabetes market. This will be an end-to-end launch solution, including field reps, inside sales reps, OCE, information management infrastructure, data analytics, commercial compliance, and copay card operations. Also, in the quarter, I'm sure you saw that we received an award from Sanofi to deploy our OCE platform within the Middle East and Africa markets. Sanofi has been using IQVIA in many markets around the world to support their HCP engagements.

For example, an EBP client selected IQVIA to provide analytics around key prescriber and payer trend for their women's health products. In another significant win this quarter, IQVIA secured a large US data analytics contract with a top 10 pharma client that had been buying from a competitor for over a decade. We also received an award from an EBP client to support the launch of their first branded product into the diabetes market.

Speaker 4: An EBP client selected IQVIA to provide analytics around key prescriber and payer trend for their women's

Benny B P client selected the I Q of you to provide analytics around keep prescriber and pay your trend.

For the women's health products.

Speaker 4: In another significant win this quarter, IQVIA secured a large U.S. data analytics contract with a top 10 pharma client that had been buying from a competitor for over a decade.

In another significantly when this quarter I cube secured a large U S data analytics contract with the top 10 for my client that has been buying from a competitor for over a decade.

Speaker 4: We also received an award from an EBP client to support the launch of their first branded product into the diabetes market.

We also received an award from an EVP client to support the launch of their first branded product into the diabetes market.

This will be an end-to-end launch solution, including field reps, inside sales reps, OCE, information management infrastructure, data analytics, commercial compliance, and copay card operations. Also, in the quarter, I'm sure you saw that we received an award from Sanofi to deploy our OCE platform within the Middle East and Africa markets. Sanofi has been using IQVIA in many markets around the world to support their HCP engagements.

Speaker 4: This will be an end-to-end launch solution including field REFs, inside sales REFs, OCE, information management infrastructure, data analytics, commercial compliance, and copay call operation.

This will be an <unk> solution, including field reps inside sales reps, Oh C E information management infrastructure data analytics commercial compliance and copay called operations.

Speaker 4: Also in the quarter, I'm sure you saw that we received an award from Sanofi to deploy our OCE platform within the Middle East and Africa markets. Sanofi has been using IQVIA in many markets around the world to support their HCP engagements. On the tech side,

Also in the quarter I'm sure you saw that we received an award from <unk>.

To deploy our old C E platform within the Middle East and Africa markets San hose. He has been using I Q, yes in many markets around the world to support the HCP engagements on the tech side.

Operator: On the tech side, we've been getting some questions about our partnership with Salesforce, and I just want to confirm that IQVIA has been a key life sciences partner to Salesforce for many years now, with offerings that span from clinical to commercial. We plan to continue this strong partnership with Salesforce, combining our life sciences domain expertise and intelligence with Salesforce technologies and platforms. Moving now to real-world, we were awarded multiple rare disease studies from both large pharma and biotech clients, highlighting our expertise and differentiated offerings within this growing therapeutic area, including innovative study design, patient recruitment, and AI-enabled technology to provide unique solutions. Couple of examples: a top 20 large pharma awarded IQVIA a 10-year study to improve patient treatments for a rare genetic liver disease.

On the tech side, we've been getting some questions about our partnership with Salesforce, and I just want to confirm that IQVIA has been a key life sciences partner to Salesforce for many years now, with offerings that span from clinical to commercial. We plan to continue this strong partnership with Salesforce, combining our life sciences domain expertise and intelligence with Salesforce technologies and platforms.

Speaker 4: We've been getting some questions about our partnership with Salesforce. And I just want to confirm that IQVIA has been a key life sciences partner to Salesforce for many years now with offerings that span from clinical to commercial.

We've been getting some questions about our partnership with sales force and I just want to confirm that Ikea has been achy life Sciences partner too says force for many years now with offerings that span from clinical too commercial.

Speaker 4: And we plan to continue this strong partnership with Salesforce combining our life sciences domain expertise and intelligence with Salesforce technologies and platforms.

And we plan to continue the strong partnership with sales force, combining our life Sciences domain expertise and intelligence with Salesforce technologies and platforms.

Moving now to real-world, we were awarded multiple rare disease studies from both large pharma and biotech clients, highlighting our expertise and differentiated offerings within this growing therapeutic area, including innovative study design, patient recruitment, and AI-enabled technology to provide unique solutions. Couple of examples: a top 20 large pharma awarded IQVIA a 10-year study to improve patient treatments for a rare genetic liver disease.

Speaker 4: Moving now to real world, we were awarded multiple rare disease studies from both large pharma and biotech clients.

Moving now to real World, we will reward with multiple rare disease studies from both lost trauma and biotech clients.

Speaker 4: highlighting our expertise and differentiated offerings within this growing therapeutic area, including innovative study design, patient recruitment, and AI-enabled technology to provide unique solutions. A couple of examples. A top 20 large pharma awarded IQVIA a 10-year study to improve patient treatments for a rare genetic liver disease.

Highlighting our expertise and differentiated offerings within these growing therapeutic area, including innovative study design patient recruitment and Eh I enabled technology to provide unique solutions couple of examples.

<unk> <unk> <unk> <unk>, the 10 year study to improve patient treatments for a rare genetic liver disease.

Operator: A Japanese EBP client awarded IQVIA two large post-marketing surveillance studies on rare diseases in the circulatory, nervous, and muscular systems. Moving now to R&DS, we entered into a strategic collaboration with the Coalition for Epidemic Preparedness Innovations, CEPI, aimed at enhancing the world's ability to rapidly conduct clinical research for vaccines and other biological countermeasures against emerging infectious diseases. This collaboration is a key enabler of CEPI's mission goal, which is sponsored by the G7 and G20 countries to develop safe, effective, and globally accessible vaccines against emerging disease outbreaks within 100 days. We've also entered into an innovative strategic collaboration with argenx, a global immunology biotech company. Leveraging our connected intelligence capabilities, we bring together end-to-end asset development services, ranging from regulatory to market authorization to integrated technology-enabled pharmacovigilance safety tracking. This will allow argenx to accelerate the market launch of new rare disease therapies to autoimmune patients.

A Japanese EBP client awarded IQVIA two large post-marketing surveillance studies on rare diseases in the circulatory, nervous, and muscular systems. Moving now to R&DS, we entered into a strategic collaboration with the Coalition for Epidemic Preparedness Innovations, CEPI, aimed at enhancing the world's ability to rapidly conduct clinical research for vaccines and other biological countermeasures against emerging infectious diseases.

Speaker 4: A Japanese EBP client awarded IQVIA two large post-marketing surveillance studies on rare diseases in the circulatory, nervous, and musculoskeletal systems.

The Japanese EVP client awarded I Q have yet to lodge post marketing surveillance studies on rare diseases in the <unk> nervous and mosquitoes systems.

Speaker 4: Moving now to RNDS, we entered into a strategic collaboration with the Coalition for Epidemic Preparedness Innovations, CEPI.

Moving now to Orange, Yes, we entered into a strategic collaboration with the coalition for epidemic preparedness innovations <unk>.

Speaker 4: aimed at enhancing the world's ability to rapidly conduct clinical research for vaccines and other biological countermeasures against emerging infectious diseases.

Aimed at enhancing the world's ability to rapidly conduct clinical research for vaccines and all their biological counter measures against emerging infectious diseases.

This collaboration is a key enabler of CEPI's mission goal, which is sponsored by the G7 and G20 countries to develop safe, effective, and globally accessible vaccines against emerging disease outbreaks within 100 days. We've also entered into an innovative strategic collaboration with Argenx, a global immunology biotech company.

Speaker 4: This collaboration is a key enabler of CEPI's mission goal, which is sponsored by the G7 and G20 countries, to develop safe, effective, and globally accessible vaccines against emerging disease outbreaks within 100 days.

<unk> operation is a key enabler of <unk>, which is sponsored by the G seven and G 20 countries.

To develop safe effective and globally accessible vaccines against emerging disease outbreaks within 100 days.

Speaker 4: We've also entered into an innovative strategic collaboration with Argenix, a global immunology.

We've also entered into an innovative strategic collaboration with <unk>.

A global immunology biotech company.

Leveraging our connected intelligence capabilities, we bring together end-to-end asset development services, ranging from regulatory to market authorization to integrated technology-enabled pharmacovigilance safety tracking. This will allow Argenx to accelerate the market launch of new rare disease therapies to autoimmune patients.

Speaker 4: Leveraging our connected intelligence capabilities, we bring together end-to-end asset development services ranging from regulatory to market authorization to integrated technology-enabled pharmacovigilance safety tracking. This will allow Argenix to accelerate the market launch of new rare disease therapies to autoimmune patients.

Leveraging our connected intelligence capabilities, we bring together and two and asset development services.

Ranging from regulatory to market authorization to integrated technology enabled pharmacovigilance safety tracking.

This will allow <unk> to accelerate the market launch of new rare disease therapies to auto immune patience.

Operator: In the quarter, a top 10 pharma client renewed their FSP partnership with IQVIA as they look to design and launch their new clinical monitoring model. IQVIA will co-develop the solution, leveraging our expertise, innovative tech-enabled approach, and exceptional delivery performance. IQVIA has been named the sole global medical information center provider by one of our large pharma clients. IQVIA differentiates in the market as the only provider to have successfully utilized an AI natural language processing solution for medical information. As has been the case in the last few years, R&DS continues to win big in oncology, with multiple awards in the quarter. A few examples: IQVIA won a late-stage program with a biotech company developing Immuno-Oncology therapies. We were selected after successful delivery of an earlier stage trial, as well as our unparalleled data analytics to help identify patients and populations with unmet needs.

In the quarter, a top 10 pharma client renewed their FSP partnership with IQVIA as they look to design and launch their new clinical monitoring model. IQVIA will co-develop the solution, leveraging our expertise, innovative tech-enabled approach, and exceptional delivery performance. IQVIA has been named the sole global medical information center provider by one of our large pharma clients. IQVIA differentiates in the market as the only provider to have successfully utilized an AI natural language processing solution for medical information.

In the quarter, a top 10 fault my client renewed the S. S. P partnership with <unk> as they look to design along with the new clinical monitoring model.

Speaker 4: In the quarter, a top 10 pharma client renewed their FSP partnership with IQVIA as they look to design and launch their new clinical monitoring model.

Speaker 4: IQVIA will co-develop the solution, leveraging our expertise, innovative tech-enabled approach, and exceptional delivery performance.

<unk> could develop the solution leveraging our expertise innovative tech enabled approach and.

An exceptional delivery performance.

Speaker 4: IQVIA has been named the sole global medical information center provider by one of our large format lines.

<unk> has been named her soul Global Medical information center provider by one of our last fall my clients.

Speaker 4: IQVIA differentiates in the market as the only provider to have successfully utilized an AI natural language processing solution for medical information.

Q V a differentiate in the market is the only provider.

You have successfully utilized and AI natural language processing solution for medical information.

As has been the case in the last few years, R&DS continues to win big in oncology, with multiple awards in the quarter. A few examples: IQVIA won a late-stage program with a biotech company developing Immuno-Oncology therapies. We were selected after successful delivery of an earlier stage trial, as well as our unparalleled data analytics to help identify patients and populations with unmet needs.

Speaker 4: As has been the case in the last few years, RNDS continues to win big in oncology with multiple awards in the quarter. A few examples.

As has been the case in the last few years R&D S continues to win big in oncology with multiple awards in the call a few examples.

Speaker 4: IQVIA won a late-stage program with a biotech company developing immuno-oncology therapy.

<unk> a late stage program with a biotech company developing immuno oncology therapies. We were selected after successful delivery of an earlier stage trial as well as our unparalleled data analytics to help identify patients and populations with unmet needs.

Speaker 4: We were selected after successful delivery of an earlier stage trial, as well as our unparalleled data analytics to help identify patients and populations with unmet needs.

Speaker 4: We were awarded a phase three oncology trial from a large cutting edge biotech company.

Operator: We were awarded a phase three oncology trial from a large cutting-edge biotech company. IQVIA was selected for our expertise in endometrial carcinoma cancer, as well as our ability to accelerate trial startup. This is an important trial given the unmet medical need and limited treatment options for patients with this condition. Also, IQVIA was awarded two large global oncology trials from a mid-sized pharma client. IQVIA was selected due to our strategic design and operational expertise in oncology, including our ability to manage multiple large complex trials and our experience managing the unique safety profile of these molecules. With that, I will turn it over to Ron for more details on our financial performance. Thanks, Ari, and good morning, everyone. Let's start by reviewing revenue. Q3 revenue of $3,736 million grew 4.9% on a reported basis and 4.1% at constant currency.

We were awarded a phase III oncology trial from a large cutting-edge biotech company. IQVIA was selected for our expertise in endometrial carcinoma cancer, as well as our ability to accelerate trial startup. This is an important trial given the unmet medical need and limited treatment options for patients with this condition. Also, IQVIA was awarded two large global oncology trials from a mid-sized pharma client.

We were rewarded phase III oncologist, Chihuahua from Iraq cutting edge biotech company.

Speaker 4: IQVIA was selected for our expertise in endometrial carcinoma cancer.

Yeah. It was selected for our expertise in <unk> carcinoma cancer.

Speaker 4: as well as our ability to accelerate trial startup. This is an important trial given the unmet medical need and limited treatment options for patients with this condition.

As well as our ability to accelerate trial starts up.

This is an important trial given the unmet medical need unlimited treatment options for patients with this condition.

Speaker 4: Also, IQVIA was awarded two large global oncology trials from a mid-sized pharma client.

Also like Hugo was awarded to large global oncology trials from a mid sized former client I.

IQVIA was selected due to our strategic design and operational expertise in oncology, including our ability to manage multiple large complex trials and our experience managing the unique safety profile of these molecules. With that, I will turn it over to Ron for more details on our financial performance.

Speaker 4: IQVA was selected due to our strategic design and operational expertise in oncology, including our ability to manage multiple large complex trials and our experience managing the unique safety profile of these molecules.

<unk> was selected due to our strategic design and operational expertise in oncology, including our ability to manage multiple lapsed complex trials and our experienced managing the unique safety profile of these molecules.

Speaker 5: With that, I will turn it over to Ron for more details on our financial performance. Thanks, Ari, and good morning, everyone.

With that I will turn it over to wrong for more details on our financial performance.

Ron Bruehlman: Thanks, Ari, and good morning, everyone. Let's start by reviewing revenue. Q3 revenue of $3,736 million grew 4.9% on a reported basis and 4.1% at constant currency. Now, in the quarter, COVID-related revenues were about $95 million, down about $125 million versus the Q3 of 2022. Excluding all COVID-related work from both this year and last, constant currency growth was approximately 8.5%. As Ari mentioned, acquisitions contributed about 150 basis points of this growth.

Thanks, sorry, and good morning, everyone.

Let's start by reviewing revenue.

Speaker 5: Third quarter revenue of $3,736,000,000 grew 4.9% on a reported basis and 4.1%

Third quarter revenue of $3.736 billion group 4.9 per cent on a reported basis and.

4.1% a constant currency.

Speaker 5: In the quarter, COVID-related revenues were about $95 million.

Operator: Now, in the quarter, COVID-related revenues were about $95 million, down about $125 million versus the Q3 of 2022. Excluding all COVID-related work from both this year and last, constant currency growth was approximately 8.5%. As Ari mentioned, acquisitions contributed about 150 basis points of this growth. Technology and Analytics Solutions revenue was $1,431 million. That's up 2.2% on a reported basis and 0.9% at constant currency. Excluding all COVID-related work, constant currency growth in TAS was 5%. R&D Solutions revenue of $2,122 million was up 7.2% reported, and 6.4% at constant currency. Excluding all COVID-related work, constant currency growth in R&DS was 11%. Lastly, Contract Sales and Medical Solutions, or CSMS, revenue of $183 million was flat on a reported basis, and up 4.9% at constant currency. Year-to-date revenue of $11,116 million grew 4.2% on a reported basis, and 4.8% at constant currency.

And in the quarter Covid related revenues were about $95 million.

Speaker 5: down about $125 million versus the third quarter of 2022.

Down about $125 million versus the third quarter of 2022.

Speaker 5: Excluding all COVID-related work from both this year and last, constant currency growth was approximately 8.5%, and as already mentioned, acquisitions contributed about 150 basis points of this growth.

Excluding all Covid related work from both this year and last constant currency growth with approximately 8.5 per cent is already mentioned acquisitions contributed about 150 basis points of described.

Technology and Analytics Solutions revenue was $1,431 million. That's up 2.2% on a reported basis and 0.9% at constant currency. Excluding all COVID-related work, constant currency growth in TAS was 5%. R&D Solutions revenue of $2,122 million was up 7.2% reported, and 6.4% at constant currency. Excluding all COVID-related work, constant currency growth in R&DS was 11%. Lastly, Contract Sales and Medical Solutions, or CSMS, revenue of $183 million was flat on a reported basis, and up 4.9% at constant currency.

Speaker 5: Technology and analytic solutions revenue was $1,431,000,000. That's up 2.2% on a reported basis and 0.9% at constant currency. And excluding all COVID-related work, constant currency growth in TAS was 5%.

Technology and analytics solutions revenue was $1.431 billion, that's up 2.2 per cent on a reported basis.

0.9% a constant currency.

Excluding all Covid related work constant currency growth and Taz was five per cent.

Speaker 5: R&D solutions revenue of $2,122,000,000 was up 7.2% reported in 6.4% of constant currency.

R&D solutions revenue of $2.122 billion was up 7.2 per cent reported.

6.4 per cent constant currency.

Speaker 5: Excluding all COVID-related work, constant currency growth in RNDS was 11%.

Screening all COVID-19 related work constant currency growth and R&D S with 11%.

Speaker 5: Lastly, contract sales and medical solutions or CSMS revenue of $183 million was flat on a reported basis and up 4.9% at constant current.

Lastly contract sales and medical solutions or C. S. M. S revenue of $183 million was flat on a reported basis and up 4.9% constant currency.

Year-to-date revenue of $11,116 million grew 4.2% on a reported basis, and 4.8% at constant currency. Excluding all COVID-related work, constant currency growth was 11% year-to-date. Technology and Analytics Solutions revenue year-to-date was $4,331 million, up 2% reported, and 2.4% at constant currency. Excluding all COVID-related work, growth at constant currency in TAS year-to-date was 7%. R&DS year-to-date revenue of $6,244 million was up 6.5% at actual FX rates and 6.8% at constant currency.

Speaker 5: Year-to-date revenue of $11,116,000,000 grew 4.2% on a reported basis and 4.8% at constant currency.

Year to date revenue of $11.116 billion grew 4.2 per cent on a reported basis and 4.8% in constant currency <unk>.

Operator: Excluding all COVID-related work, constant currency growth was 11% year-to-date. Technology and Analytics Solutions revenue year-to-date was $4,331 million, up 2% reported, and 2.4% at constant currency. Excluding all COVID-related work, growth at constant currency in TAS year-to-date was 7%. R&DS year-to-date revenue of $6,244 million was up 6.5% at actual FX rates and 6.8% at constant currency. Excluding all COVID-related work, growth at constant currency in R&DS was 14% year-to-date. Finally, contract sales and medical solutions year-to-date revenue of $541 million declined 3.6% reported and increased 1.2% at constant currency. Let's move down the P&L. Adjusted EBITDA in the quarter was $888 million, representing growth of 9.1%, while year-to-date adjusted EBITDA was $2,603 million, up 7.3% year-over-year. Q3 GAAP net income was $303 million, and GAAP diluted earnings per share was $1.63. Year-to-date GAAP net income was $889 million, or $4.76 of earnings per diluted share.

Speaker 5: Excluding all COVID-related work, constant currency growth was 11% year-to-date.

Excluding all COVID-19 related work constant currency growth with 11% year to date.

Speaker 5: Technology and analytics solutions revenue year-to-date was $4,331,000,000, up 2% reported and 2.4% at constant currency. And excluding all COVID-related work, growth at constant currency in TAS year-to-date was 7%.

Technology and analytics solutions revenue year to date was $4.331 billion up two per cent reported and 2.4% a constant currency and excluding all covered related work relative constant currency task you the day with seven per cent.

Speaker 5: RD Solutions year-to-date revenue of $6,244,000,000 was up 6.5% at actual FX rates and 6.8% at constant current.

R. D solutions year to date revenue $6.244 billion was up $6 five per cent at actual F X rays.

6.8 per cent in constant currency screwing, all COVID-19 related work wrote the constant currency and R&D S was 14% year to date and Ah finally contract sales and medical solutions irritate revenue.

Excluding all COVID-related work, growth at constant currency in R&DS was 14% year-to-date. Finally, contract sales and medical solutions year-to-date revenue of $541 million declined 3.6% reported and increased 1.2% at constant currency. Let's move down the P&L. Adjusted EBITDA in the quarter was $888 million, representing growth of 9.1%, while year-to-date adjusted EBITDA was $2,603 million, up 7.3% year-over-year. Q3 GAAP net income was $303 million, and GAAP diluted earnings per share was $1.63.

Speaker 5: excluding all COVID-related work, growth at constant currency in RNDS was 14% year-to-date. And finally, contract sales and medical solutions, year-to-date revenue of $541 million, declined 3.6% reported, and increased 1.2% at constant currency.

$541 million declined 3.6 per cent reported an increase 1.2% a constant currency.

Speaker 5: Let's move down to P&L. Adjusted EBITDA in the quarter was $888 million, representing growth of 9.1%, while year-to-date adjusted EBITDA was $2,603 million, up 7.3% year-over-year.

She moved down the P&L adjusted EBITDA in the corner was $888 million representing growth at 9.1% a year to date adjusted EBITDA was $2.603 billion up 7.3% year over year.

Speaker 5: Third quarter GAAP net income was $303 million and GAAP diluted earnings per share was $1.63. Year-to-date GAAP net income was $889 billion or $4.76 of earnings per diluted share.

Third quarter Gaffe net income was $303 million and get diluted earnings per share with one dollar and 63 cents. Your to date GAAP net income with $889 billion or $4.76.

Year-to-date GAAP net income was $889 million, or $4.76 of earnings per diluted share. Adjusted net income was $462 million for the Q3, and adjusted diluted earnings per share was $2.49. Year-to-date adjusted net income was $1,378 million, or $7.37 per diluted share. Excluding the year-over-year impact of the step-up in interest rates and the increase in the UK corporate tax rate, adjusted diluted earnings per share grew 13% in the Q3 and 12% year-to-date.

<unk> per diluted share.

Speaker 5: Adjusted net income was $462 million for the third quarter, and adjusted diluted earnings per share was $2.49.

Operator: Adjusted net income was $462 million for the Q3, and adjusted diluted earnings per share was $2.49. Year-to-date adjusted net income was $1,378 million, or $7.37 per diluted share. Excluding the year-over-year impact of the step-up in interest rates and the increase in the UK corporate tax rate, adjusted diluted earnings per share grew 13% in the Q3 and 12% year-to-date. Now, as Ari reviewed, R&D solutions delivered another strong quarter of bookings. Backlog at 30 September stood at $28.8 billion, up almost 12% year-over-year, and 33% higher in the last three years. Okay, let's review the balance sheet. As of 30 September, cash and cash equivalents totaled $1,224 million, and gross debt was $13,631 million, and that resulted in net debt of $12,407 million. Our net leverage ratio ended the quarter at 3.52x trailing 12-month adjusted EBITDA.

Adjusted net income was 460.

$2 million for the third quarter and adjusted diluted earnings per share was $2.49.

Speaker 5: Year-to-date adjusted mid-income was $1,378,000,000 or $7.37 for diluted share.

Your date, adjusted net income was $1.378 billion or $7.37 per diluted share.

Speaker 5: Excluding the year-over-year impact of the step-up in interest rates and the increase in the UK corporate tax rate, adjusted diluted earnings per share grew 13% in the third quarter and 12% year-to-date.

Excluding the year over your impact of the step up in interest rates and the increase in the UK corporate tax rate adjusted diluted earnings per share grew 13% in the third quarter and 12% year to date.

Now, as Ari reviewed, R&D solutions delivered another strong quarter of bookings. Backlog at 30 September stood at $28.8 billion, up almost 12% year-over-year, and 33% higher in the last three years. Okay, let's review the balance sheet. As of 30 September, cash and cash equivalents totaled $1,224 million, and gross debt was $13,631 million, and that resulted in net debt of $12,407 million. Our net leverage ratio ended the quarter at 3.52x trailing 12-month adjusted EBITDA.

Speaker 5: Now, it's already reviewed. R&D Solutions delivered another strong quarter of bookings. Backlog at September 30th stood at $28.8 billion, up almost 12% year over year and 33% higher in the last three years.

Now it's already reviewed R&D solutions delivered another strong quarter of bookings back.

Backlog at September 30th stood at.

$28.8 billion up almost 12 per cent year every year and 33% higher in the last three years.

Speaker 5: Okay, let's review the balance sheet. As of September 30th, cash and cash equivalents total $1,224,000,000 in gross debt was $13,631,000,000.

Okay, Let's review the balance sheet as of September 30th cash and cash equivalents total $1.224 billion and gross that was $13.631 billion.

Speaker 5: and that resulted in a net debt of $12,407,000,000. Our net leverage ratio ended the quarter at 3.52 times trailing 12-month adjusted EBITDA.

And that resulted in net data $12.407 billion or.

Leverage ratio ended the quarter at 3.52 times trailing 12 month adjusted EBITDA.

Operator: Q3 cash flow from operations was $583 million, and capital expenditures were $146 million, resulting in free cash flow of $437 million. Now, you saw in the quarter that we repurchased $144 million of our shares, which puts our year-to-date share repurchase activity just slightly below $800 million. This leaves us with just under $2.6 billion of share repurchase authorization remaining under the current program. Okay, let's turn to guidance. We're updating our guidance to reflect both the slower growth in the TAS segment and the headwind from foreign exchange rates compared to our previous guide. We currently expect revenue to be between $14,885 million and 14,920 million, which represents year-over-year growth of 3.3% to 3.5%. Excluding approximately $600 million of COVID-related revenue step-down versus 2022, this guidance represents growth at constant currency of approximately 9%, including about 140 basis points of contribution from acquisitions.

Q3 cash flow from operations was $583 million, and capital expenditures were $146 million, resulting in free cash flow of $437 million. Now, you saw in the quarter that we repurchased $144 million of our shares, which puts our year-to-date share repurchase activity just slightly below $800 million. This leaves us with just under $2.6 billion of share repurchase authorization remaining under the current program. Okay, let's turn to guidance.

Speaker 5: Third quarter cash flow from operations was $583 million, and capital expenditures were $146 million, resulting in free cash flow of $437 million.

Third quarter cash flow from operations with $583 million.

Capital expenditures were $146 million, resulting in free cash flow of $437 million.

Speaker 5: Now, you saw in the quarter that we repurchased a hundred and forty four million dollars of our shares, which put their year to date share repurchase activity just slightly below eight hundred million dollars. This leaves us with just under two point six billion dollars of share repurchase authorization remaining under the current program.

And you saw on the corner that we repurchased $144 million of our shares.

Which puts our year to date share repurchase activity, just slightly below $800 million.

That's with just under $2.6 billion, a share repurchase authorization remaining under the current progress.

Speaker 5: Okay, let's turn to guidance. We're updating our guidance to reflect both the slower growth in the TAS segment and the headwind from foreign exchange rates compared to our previous guide. We currently expect revenue to be between $14,885,000,000 and $14,920,000,000, which represents year-over-year growth of 3.3 to 3.5%.

Okay, let's turn to guidance, we're updating our guidance to reflect both the slower growth in the task segment.

We're updating our guidance to reflect both the slower growth in the TAS segment and the headwind from foreign exchange rates compared to our previous guide. We currently expect revenue to be between $14,885 million and 14,920 million, which represents year-over-year growth of 3.3% to 3.5%. Excluding approximately $600 million of COVID-related revenue step-down versus 2022, this guidance represents growth at constant currency of approximately 9%, including about 140 basis points of contribution from acquisitions.

And the headwind from foreign exchange rates compared to our previous Sky we.

We currently expect revenue to be between $14.885 billion and $14.920 billion, which represents year over year growth of 3.3% to 3.5%.

Speaker 5: Excluding approximately $600 million of COVID-related revenue step down versus 2022, this guidance represents growth at constant currency of approximately 9%, including about 140 basis points of contribution from acquisition.

Excluding approximately $600 million of Covid related revenue step-down versus 2022. This guidance represents growth constant currency of approximately 9%, including about 140 basis points a contribution from acquisitions.

Speaker 5: To reflect these changes in revenue, we're also updating our guidance for full-year adjusted EBITDA to $3,560,000,000 to $3,570,000,000, and this represents year-over-year growth at 6.4 to 6.7 percent.

Operator: To reflect these changes in revenue, we're also updating our guidance for full-year Adjusted EBITDA to $3,560 million to $3,570 million, and this represents year-over-year growth of 6.4% to 6.7%. It also implies 70 basis points of margin expansion for the year. Lastly, we're updating our guidance for Adjusted Diluted EPS to $10.16 to $10.23, which is flat to up 0.7% versus the prior year. This includes the year-over-year impact of the step-up in interest rates and the increase in the UK corporate tax rate. If you were to exclude these items, adjusted diluted earnings per share is now expected to grow 11% to 12%. Now, based on this full-year outlook, our implied Q4 guidance is as follows. For revenue, we expect between $3,769 million and $3,804 million of growth of 0.8% to 1.7% on a reported basis and 0.7% to 1.6% on a constant currency basis.

To reflect these changes in revenue, we're also updating our guidance for full-year Adjusted EBITDA to $3,560 million to $3,570 million, and this represents year-over-year growth of 6.4% to 6.7%. It also implies 70 basis points of margin expansion for the year. Lastly, we're updating our guidance for Adjusted Diluted EPS to $10.16 to $10.23, which is flat to up 0.7% versus the prior year. This includes the year-over-year impact of the step-up in interest rates and the increase in the UK corporate tax rate.

To reflect these changes in revenue. We're also updating our guidance for full year adjusted EBITDA to $3.560 billion to $3.570 billion and this represents year over year growth of 6.4 to $6 seven per cent.

Speaker 5: It also implies 70 basis points of margin expansion for the year.

It also implies 70 basis points margin expansion for the year.

Speaker 5: Lastly, we're updating our guidance for adjusted diluted EPS to $10.16 to $10.23, which is flat to up 0.7% versus the prior year. This includes the year-over-year impact of the step-up in interest rates and the increase in the UK corporate tax rate. If you were to exclude these items, adjusted diluted earnings per share is now expected to grow 11% to 12%.

Lastly, we're updating our guidance for adjusted diluted EPS to $10.16 to $10.23, which is flat Ah 0.7% versus the prior year.

Concludes the year every year impacted a step up in interest rates and the increase in you take corporate tax rate. If you were to exclude these items suggested diluted earnings per share is now expected to grow 11% to 12%.

If you were to exclude these items, adjusted diluted earnings per share is now expected to grow 11% to 12%. Now, based on this full-year outlook, our implied Q4 guidance is as follows. For revenue, we expect between $3,769 million and $3,804 million of growth of 0.8% to 1.7% on a reported basis and 0.7% to 1.6% on a constant currency basis.

Speaker 5: Now, based on this full year outlook, our implied 4th, 4th quarter guidance is as follows for revenue.

Based on this full year outlook are applied for.

Fourth quarter guidance is as follows for <unk>.

Speaker 5: We expect between $3,769,000,000 and $3,804,000,000 of growth of 0.8% to 1.7% on a reported basis and 0.7% to 1.6% on a constant currency basis.

We expect between $3.769 billion and $3.804 billion or growth of 0.801 0.7 per cent on a reported basis and <unk>, 0.7% to 1.6% on a constant currency basis.

Speaker 5: Adjusted EBITDA is expected to be between $957 million and $967 million, up 4% to 5.1%. And that yields margin expansion of about 80 basis points in the quarter. Adjusted diluted EPS is expected to be between $2.79 and $2.86, growing 0.4% to 2.9% year-over-year.

Operator: Adjusted EBITDA is expected to be between $957 million and 967 million, up 4% to 5.1%, and that yields margin expansion of about 80 basis points in the quarter. Adjusted diluted EPS is expected to be between $2.79 and 2.86, growing 0.4% to 2.9% year-over-year. Excluding the step-up in interest expense and the increased UK tax rate, we're expecting Q4 adjusted diluted EPS to grow 10% to 13%. Now, all of our guidance assumes that foreign currency rates as of 30 October 2023 continue for the balance of the year. Now, as is our custom, we plan to provide you with a detailed 2024 full-year guidance on our Q4 earnings call in February. However, while it's early and we're still in the midst of our planning process, we thought it would be helpful to share a preliminary view that would help you frame how we see 2024.

Adjusted EBITDA is expected to be between $957 million and 967 million, up 4% to 5.1%, and that yields margin expansion of about 80 basis points in the quarter. Adjusted diluted EPS is expected to be between $2.79 and 2.86, growing 0.4% to 2.9% year-over-year. Excluding the step-up in interest expense and the increased UK tax rate, we're expecting Q4 adjusted diluted EPS to grow 10% to 13%. Now, all of our guidance assumes that foreign currency rates as of 30 October 2023 continue for the balance of the year.

Adjusted EBITDA is expected to be between $957 million and $967 million up four to 5.1 per cent and that yields margin expansion of about 80 basis points and the quarter adjusted diluted EPS is expected to be between $2.79 and $2 and 80.

<unk> growing 0.4% to 2.9% year over year.

Speaker 5: Excluding the step up in interest expense and the increased UK tax rate, we're expecting fourth quarter adjusted diluted EPS to grow 10 to 13%.

Excluding the step up an interest expense and the increased UK tax rate, we're expecting fourthquarter adjusted diluted D. E. P. S you grow 10% to 13%.

Speaker 5: Now, all of our guidance assumes that foreign currency rates as of October 30th continue for the balance of the year.

Now all of our guidance assumes foreign currency rates as of October 30th continue for the balance of the year.

Now, as is our custom, we plan to provide you with a detailed 2024 full-year guidance on our Q4 earnings call in February. However, while it's early and we're still in the midst of our planning process, we thought it would be helpful to share a preliminary view that would help you frame how we see 2024.

Speaker 5: Now, as is our custom, we plan to provide you with a detailed 2024 full year guidance on our Q4 earnings call in February .

Now as is our custom we plan to provide you with a detailed 2024 full year guidance on our queue for earnings call in February.

Speaker 5: However, while it's early and we're still in the midst of our planning process, we thought it would be helpful to share.

However, wallets or away and we're still in the midst of our planning process, we thought it would be helpful to share.

Speaker 5: preliminary view that would help you frame how we see 2024.

Preliminary view that would help explain how we see 2024.

Speaker 5: We see reported revenue growth in the mid single digits in 2024. This includes a further step down of approximately 300Million dollars in covered revenue, which is about 200 basis points of headwind to revenue growth.

Operator: We see reported revenue growth in the mid-single digits in 2024. This includes a further step-down of approximately $300 million in COVID revenue, which is about 200 basis points of headwind to revenue growth, as well as another 100 basis points of headwind from foreign exchange rates, assuming current foreign currency exchange rates remain in effect for 2024. We see adjusted EBITDA margins expanding 50 basis points, and this will drive high single-digit adjusted diluted EPS growth. Now, I trust this preliminary look at 2024 is helpful to you. Again, we will, as is our custom, give you more detailed guidance and specificity for 2024 when we release our full-year earnings early next year. So, to summarize, despite client caution and spending levels below our expectations, the TAS business continued its growth in the quarter, while the near-term growth outlook for TAS is below our previous expectations.

Operator: We see reported revenue growth in the mid-single digits in 2024. This includes a further step-down of approximately $300 million in COVID revenue, which is about 200 basis points of headwind to revenue growth, as well as another 100 basis points of headwind from foreign exchange rates, assuming current foreign currency exchange rates remain in effect for 2024. We see adjusted EBITDA margins expanding 50 basis points, and this will drive high single-digit adjusted diluted EPS growth. Now, I trust this preliminary look at 2024 is helpful to you. Again, we will, as is our custom, give you more detailed guidance and specificity for 2024 when we release our full-year earnings early next year. So, to summarize, despite client caution and spending levels below our expectations, the TAS business continued its growth in the quarter, while the near-term growth outlook for TAS is below our previous expectations.

We see reported revenue growth in the mid single digits. In 2024. This includes a further step down of approximately $300 million and covered revenue, which is about 200 basis points of headwind to revenue growth.

Speaker 5: as well as another 100 basis points of headwind from foreign exchange rates.

As well as another 100 basis points of headwind from foreign exchange rates.

Speaker 5: Assuming current foreign currency exchange rates remain in effect for 2024.

Assuming current foreign currency exchange rates remain in effect for 2024.

Speaker 5: We see adjusted EBITDA margins expanding 50 basis points, and this will drive.

We see adjusted EBITDA margins, expanding 50 basis points and this will dry <unk>.

Speaker 5: High single digit adjusted diluted EPS growth. Now I trust this preliminary look at 2024 is helpful to you.

High single digit adjusted diluted EPS private now.

Now I I Trust just preliminary look at 2024 is helpful to you.

Speaker 5: Again, we will, as is our custom, give you more detailed guidance and specificity for 2024 when we release our full year earnings early next year.

Again, we will as is our custom give you more detailed guidance and specificity for 2024, when we release our for your earnings early next year.

Speaker 5: So, to summarize, despite client caution and spending levels below our expectations, the TAS business continued its growth in the quarter. While the near-term growth outlook for TAS is below our previous expectations, we're confident in the longer-term fundamentals of the business as our pipelines indicate there will be a rebound in demand sometime in 2024.

So to summarise, despite client caution and spending levels below our expectations of tests business continued to it's growth in the quarter, while the near term growth outlook for taxes below our previous expectations were confident in the longer term fundamentals of the business is our pipelines indicate there will be a <unk>.

Operator: We're confident in the longer-term fundamentals of the business, as our pipelines indicate there will be a rebound in demand sometime in 2024. In the quarter, we delivered another strong performance in R&DS with 11% revenue growth at constant currency, excluding COVID-related work. Quarterly net new bookings were strong at over $2.6 billion, representing a book-to-bill of 1.24, and we reached a historic high of $2.3 billion in services bookings, representing a services book-to-bill of 1.40. Our industry-leading backlog reached a new record of $28.8 billion, up approximately 12% year-over-year. And finally, leading indicators on the clinical side remained strong, as evidenced by our quarterly RFP growth of 10% versus the prior year, with growth across all customer segments. So, with that, let me hand it back over to the operator to open up the conference for Q&A.

We're confident in the longer-term fundamentals of the business, as our pipelines indicate there will be a rebound in demand sometime in 2024. In the quarter, we delivered another strong performance in R&DS with 11% revenue growth at constant currency, excluding COVID-related work. Quarterly net new bookings were strong at over $2.6 billion, representing a book-to-bill of 1.24x, and we reached a historic high of $2.3 billion in services bookings, representing a services book-to-bill of 1.40x.

Bound in demand sometime in 2024.

In the corner, we delivered another strong performance in R&D asked with 11% revenue growth in constant currency, excluding kovac related work quarterly net new bookings.

Speaker 5: Uh, in the quarter, we delivered another, uh, strong performance in our and yes, with 11% revenue growth at constant currency, excluding coven related work. Quarterly net new bookings were strong at over 2.6. Billion dollars representing a book to bill of 124.

We're strong it over $2.6 billion, representing a book the bill of 124.

Speaker 5: And we reached a historic high of $2.3 billion in services bookings, representing a services book, the bill of 1.40.

And we reached a historic high of $2.3 billion in service is bookings representing our services book the Bill of 1.4 <unk>.

Our industry-leading backlog reached a new record of $28.8 billion, up approximately 12% year-over-year. And finally, leading indicators on the clinical side remained strong, as evidenced by our quarterly RFP growth of 10% versus the prior year, with growth across all customer segments. So, with that, let me hand it back over to the operator to open up the conference for Q&A.

Speaker 5: Our industry-leading backlog reached a new record of $28.8 billion, up approximately 12% year-over-year. And finally, leading indicators on the clinical side remain strong, as evidenced by a quarterly RFP growth of 10% versus the prior year, with growth across all customer segments.

Our industry, leading backlog reached a new record of $28.8 billion approximately.

Approximately 12% year over year.

And finally, leading indicators on the clinical side remains strong as evidenced by a quarterly RFP growth of 10% versus the prior year.

With growth across all customer segments.

Speaker 5: With that, let me hand it back over to the operator to open up the conference for Q&A.

With that let me hand, it back over to the operator to open up the conference for Q&A.

Operator: At this time, I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. We request that you please limit yourself to just one question so that others in the queue may participate as well. We'll pause for a moment to compile the Q&A roster. Your first question comes from the line of Elizabeth Anderson with Evercore ISI. Please go ahead. Hi, guys. Thanks so much for the question. One thing that I was just trying to work through for my own sort of benefit is sort of the commentary I think Ari, you alluded to in terms of some of the pullback in R&D spend on the pharma side, and the sort of continued strength of R&DS in terms of bookings and what you're seeing in terms of RFPs.

Operator: At this time, I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. We request that you please limit yourself to just one question so that others in the queue may participate as well. We'll pause for a moment to compile the Q&A roster. Your first question comes from the line of Elizabeth Anderson with Evercore ISI. Please go ahead.

At this time I would like to remind everyone in order to ask a question <unk> number one on your telephone keypad you request that you. Please limit yourself to just one question. So that address in the queue may participate as well what path for a moment to compile the queue and die roster.

Speaker 2: At this time, I would like to remind everyone in order to ask a question, press star, then a number one on your telephone keypad. You request that you please limit yourself to just one question so that others in the queue may participate as well. We'll pause for a moment to compile the Q&A roster.

Operator: Please wait, the conference will begin shortly The conference will begin shortly,[inaudible] I would now like to turn the call over to our chairman and CEO.

Speaker 2: Your first question comes from the line of Elizabeth Anderson with Evercore ISI. Please go ahead.

The first question comes from the line of Elizabeth Anderson with Evercore ISI. Please go ahead.

Elizabeth Anderson: Hi, guys. Thanks so much for the question. One thing that I was just trying to work through for my own sort of benefit is sort of the commentary I think Ari, you alluded to in terms of some of the pullback in R&D spend on the pharma side, and the sort of continued strength of R&DS in terms of bookings and what you're seeing in terms of RFPs.

Speaker 6: Hi guys, thanks so much for the question. One thing that I was just trying to work through for my own sort of benefit is sort of the commentary, I think Ari, you alluded to in terms of some of the pullback and R&D spend on the pharmacide and the sort of continued strength of R&D-S in terms of bookings and what you're seeing in terms of RFPs. Could you help us sort of think about how you think about those two factors sort of that commentary where you sort of think farmers growth is gonna be their main of this year and next year and that and maybe remind us of how that's played out in prior cycles.

Hi, guys. Thanks, so much for that question what kind of direction.

Trying to work through for my own benefit yesterday, the common K I think are you allergic to transfer some of that pullback M. In RMT spent on the pharmacy and you just sort of continue <unk>.

D as in terms of what you're seeing them in terms of Rfps could you help me I sort of think about how you think about those two factors that commentary, where you sort of think farmers growth. There's gonna be first word of the remainder of this year next year and add and maybe remind us how that's played out entire cycles. Thank you.

Operator: Could you help us sort of think about how you think about those two factors, sort of that commentary where you sort of think pharma's growth is going to be for sort of the remainder of this year and next year, and that, and maybe remind us of how that's played out in prior cycles? Thank you. Yeah. You're asking, Elizabeth, thanks for your question. You're asking about contrasting the pullback in spend on the commercial side versus the R&DS. Yeah, not on the commercial. Sorry, R&DS, more specifically. Sorry. Yeah, but there is no pullback on spend in R&DS. I don't think I said that. I said the opposite. Funding in R&DS has been very strong. I'm sorry if I misspoke or was misunderstood, but there is no pullback in R&DS, quite the opposite.

Could you help us sort of think about how you think about those two factors, sort of that commentary where you sort of think pharma's growth is going to be for sort of the remainder of this year and next year, and that, and maybe remind us of how that's played out in prior cycles? Thank you.

Ari Bousbib: Yeah. You're asking, Elizabeth, thanks for your question. You're asking about contrasting the pullback in spend on the commercial side versus the [crosstalk].

Speaker 4: Yeah, you're asking, Elizabeth, thanks for your question. You're asking about.

Yeah, you're you're asking Elizabeth Thanks for your question you're asking about.

Speaker 6: Contrasting the pullback is spent on the commercial side versus Sorry, R and D.S. More

Punk trusting to pull back and spend on the promotional side <unk> tracking all ideas.

Elizabeth Anderson: Yeah, not on the commercial. Sorry, R&DS, more specifically. Sorry.

Sorry R N D S more specifically sorry.

Ari Bousbib: Yeah, but there is no pullback on spend in R&DS. I don't think I said that. I said the opposite. Funding in R&DS has been very strong. I'm sorry if I misspoke or was misunderstood, but there is no pullback in R&DS, quite the opposite.

Speaker 4: Yeah, but there is no pullback on spam in R&Ds. I don't think I said that. I said the opposite.

Yeah, but there is no point back on spend in Orange, Yes, I don't think I said that they said the opposite.

Funding.

Speaker 4: funding, and yes, has been very strong. I'm sorry if I misspoke or was misunderstood, but there is no pullback in RNDS quite the opposite.

And yes. It has been very strong I'm, sorry, if I misspoke.

Was misunderstood, but they reason no pulled back in Orange, yes, quite the opposite.

Speaker 4: I mentioned in my introductory comments that the, if you look at the EBP sector, which has been under pressure and people have been concerned about, we see EBP funding in the whole actually fire than it was last year. And I think your today, I mentioned that funding was up 8% year over year. So I also...

Operator: I mentioned in my introductory comments that if you look at the EBP sector, which has been under pressure and people have been concerned about, we see EBP funding in the quarter actually higher than it was last year. I think year-to-date, I mentioned that funding was up 8% year-over-year. I also mentioned that we are experiencing a strong continued RFP flow growth. It's actually up 10% in the quarter year-over-year. I think it's quite the opposite. Our awards continue at a record high level, again, higher than last year. To give you some more color, our qualified pipeline is up 16% year-over-year and continues to be very, very strong. Our total pipeline as well, very strong, record high historically. I mentioned our book-to-bill in the quarter is 1.24 on a 60/6 basis, including passthroughs.

I mentioned in my introductory comments that if you look at the EBP sector, which has been under pressure and people have been concerned about, we see EBP funding in the quarter actually higher than it was last year. I think year-to-date, I mentioned that funding was up 8% year-over-year. I also mentioned that we are experiencing a strong continued RFP flow growth. It's actually up 10% in the quarter year-over-year. I think it's quite the opposite.

I mentioned in my introductory comments that the.

If you look at the EVP sector, which has been under pressure and people have been concerned about we see <unk> actually.

Than it was last year.

And I think <unk>.

I mentioned that funding was eight <unk> moods up 8% year over year.

So I also mentioned that <unk>.

Speaker 4: We are experiencing a strong, continued RFP flow growth.

We are experiencing a strong continued R. S P real growth, it's actually up 10% in the quarter you're over here.

Speaker 4: it's actually up 10% in the quarter year over year.

Speaker 4: So I think it's quite the opposite. Our walled, continue at a record high level, again, higher than last year. To give you some more color, a qualified pipeline is up 16% year over year. And it continues to be very, very strong.

So I think it's quite the opposite side of our rewards continue at a record high level again higher than last year.

Our awards continue at a record high level, again, higher than last year. To give you some more color, our qualified pipeline is up 16% year-over-year and continues to be very, very strong. Our total pipeline as well, very strong, record high historically. I mentioned our book-to-bill in the quarter is 1.24x on a 60/6 basis, including passthroughs.

Could give you some more color at 45 pipeline.

Is up 16% year over year, and and you know.

Continues to be very very strong.

Speaker 4: our total pipeline as well, very strong, record high historically. I mentioned our book to bill in the quarter.

Total pipeline as well very strong record high he's still retreat I've mentioned, a book to be all in the quarter.

Speaker 4: is 124 on a 606 basis, including pass-throughs, and when you exclude pass-throughs and you just focus on services, our book-to-bill is 1.4. Our services booking

Is 124, and 606 basis, including pass throughs and when you exclude pass throughs and you just focus on services are booked to bill is 1.4.

Operator: And when you exclude pass-throughs and you just focus on services, our book-to-bill is 1.4. Our services bookings were $2.3 billion in the quarter. That's a historic high for us. So again, nothing that we see, and we've been hammering this point over and over again in the environment or in our own internal metric, leads us to believe there is anything changed on the R&DS spend. There are different dynamics. It is true that we see our clients, large pharma especially, explore new models with more FSP or hybrid type of services awarded. I mentioned we won some large FSPs, which explains, of course, the lower amount of pass-throughs in the quarter in our bookings. But other than that, the spend is strong, and our prospects for the business continue to be very strong on the R&DS side. Thanks, Ari. That's super helpful.

And when you exclude pass-throughs and you just focus on services, our book-to-bill is 1.4x. Our services bookings were $2.3 billion in the quarter. That's a historic high for us. So again, nothing that we see, and we've been hammering this point over and over again in the environment or in our own internal metric, leads us to believe there is anything changed on the R&DS spend. There are different dynamics. It is true that we see our clients, large pharma especially, explore new models with more FSP or hybrid type of services awarded.

Our service is bookings.

Speaker 4: were 2.3 billion dollars in the court. That's a historic high for us.

<unk> $2.3 billion in the quarter, that's what she's story high for us.

Speaker 4: So again, nothing that we see, and we've been hammering this point over and over again in the environment or in an own internal metric, leads us to believe there is anything changed on the R and D S span. There are different dynamics.

So.

Again, nothing that we see and we've been hammering these phone over and over again in the environment Orange <unk> leads us to believe there is any thing.

Changed on the Orange D S <unk>, they're all different dynamics.

Speaker 4: This true that we have, we see our clients, large farmers, especially, explore new models with more FSP or hybrid type of services awarded. I mentioned we want some large FSPs, which explains, of course, the lower amount of pastures in the quarter in our bookings.

It is true that we have let me see our clients last fall my specialty explore new models with more F S b or hybrid type of.

Nicholas Childs: Thank you, Nick.

Ari Bousbib: Good morning, everyone. Thank you for joining us today to discuss our third quarter results. So in line with our expectations, R and DS is performing very well. The task business continued to grow, but revenue fell short, although we had expected about half of our total revenue shortfall came from foreign exchange headwinds, and the versus our previous guidance and the other half from persistent weakness in demand in the task segment. Despite the task revenue shortfall, our productivity actions allowed us to deliver on our profit guidance.

Services awarded I mentioned, we won some laws F. S P's, which explains of course, the lower amount of pass throughs in the in the quarter in our bookings, but other than that the Spanish strong and our prospects for the business continued to be very strong on the <unk>.

I mentioned we won some large FSPs, which explains, of course, the lower amount of pass-throughs in the quarter in our bookings. But other than that, the spend is strong, and our prospects for the business continue to be very strong on the R&DS side.

Speaker 4: But other than that, the Spanish strong and our prospects for the business continue to be very strong on the R&D SL.

Elizabeth Anderson: Thanks, Ari. That's super helpful. And so when we take the sort of pharma R&D commentary that you said about some of the pullbacks and some of the spending cuts in there, you would say that you guys are still seeing strong demand within that specific pharma segment, maybe, yeah, further, and they're cutting costs by pushing more into FSP, and maybe there's some anecdotal large pharma companies that are cutting, but there's sort of broader strength across that.

Speaker 6: Thanks, Ari. That's super helpful. And so, when we take the sort of pharma R&D commentary that you said about some of the pullbacks and some of the spending cuts in there, you would say that you guys are still seeing strong demand within that specific pharma segment, maybe, yeah, further, and they're cutting costs by pushing more into FFP, and maybe there's some anecdotal large pharma companies that are cutting, but the sort of broader strength across that, that's the correct way to interpret what you're saying on the large pharma. Yes.

Alright, that's super helpful and so when we take those sort of <unk> <unk> <unk> commentary that you started that some of the <unk> you would say that you guys are <unk> are you still seeing striking man within that specific farm segment, maybe yeah further and they're cutting <unk>.

Operator: And so when we take the sort of pharma R&D commentary that you said about some of the pullbacks and some of the spending cuts in there, you would say that you guys are still seeing strong demand within that specific pharma segment, maybe, yeah, further, and they're cutting costs by pushing more into FSP, and maybe there's some anecdotal large pharma companies that are cutting, but there's sort of broader strength across that. That's the correct way to interpret what you're saying on the large pharma side? Yes. I mean, large pharma you saw, I think, 2/3 of the top 10 large pharma, and we know that that's basically the case. The vast majority of large pharma companies have announced, either publicly or internally, significant cost-cutting programs.

Ari Bousbib: We continue to receive questions about the health of the industry and customer demand and I'd like to give you the latest of what we're seeing in the market. Let's start on the clinical development side, the man in the R and DS segment remains strong net new bookings exceeded 2.6 billion dollars, representing a quarterly book to bill of 124 overall, including pastries, and given that this quarter there is a significant difference between services, bookings and bookings with pastries, I note that our services bookings were the highest ever at 2.3 billion dollars resulting in a 1.4 services book to bill.

<unk> diet pushing more into F. S P and maybe there's some anecdotal large pharma companies that are cutting but they should've brought our strength across that that's the correct way to interpret what you're saying.

That's the correct way to interpret what you're saying on the large pharma side?

Speaker 4: Yes, I mean large from you saw I think two thirds of me

Ari Bousbib: Yes. I mean, large pharma you saw, I think, 2/3 of the top 10 large pharma, and we know that that's basically the case. The vast majority of large pharma companies have announced, either publicly or internally, significant cost-cutting programs.

Yes, yes, I mean that from you saw I think two thirds of the.

Speaker 4: top 10 large pharma and we know that that's basically the case, the vast majority.

Top 10, La farmer, and we know that that's basically the case the vast majority.

Speaker 4: of large former companies have announced either publicly or internally a significant cost-cutting program that's due to the macro environment, which is very challenging.

<unk> from Ah companies have announced either public viewing Trinity see if he can cost cutting programs. That's due to the the macro environment, which is very challenging concerns raised by the I R. A and you know the general issues that we see geopolitical.

Operator: That's due to the macro environment, which is very challenging, concerns raised by the IRA, and the general issues that we see: geopolitical problems all over the world, continuing wars in Europe, the Middle East, and, of course, we have the situation in China, which has all but frozen the market for multinational corporations in China. So all of those are headwinds, plus the companies that were very active during the COVID years are seeing dramatic pullbacks in revenue, and all of that is putting pressure on margins. And as a result, large pharma has been, and I would say unusually so, very aggressive in launching cost-reduction programs. Now, I said before that that is not reflected. So far, we haven't seen that in the R&D side of the house.

That's due to the macro environment, which is very challenging, concerns raised by the IRA, and the general issues that we see: geopolitical problems all over the world, continuing wars in Europe, the Middle East, and, of course, we have the situation in China, which has all but frozen the market for multinational corporations in China. So all of those are headwinds, plus the companies that were very active during the COVID years are seeing dramatic pullbacks in revenue, and all of that is putting pressure on margins.

Speaker 4: concerns raised by the IRA and, you know, the general issues that we see, geopolitical problems all over the world, continuing wars in Europe , the Middle East, and, of course, we have the situation in China, which has all but frozen the market for multinational corporations in China, so all of those are headwinds, plus the companies that were very active during the COVID.

Problems all over the World continuing wars in Europe, the Middle East and Ah.

Cause we have the the situation in China, which has all but frozen <unk>.

Ari Bousbib: Our backlog reached 28.8 billion dollars growing 11.7% versus prior year another historic high. Our quarterly RFP flow was up 10% year over year with growth across all customer segments. Our strong performance is supported by continued healthy market dynamics emerging biotech funding was strong in the quarter. According to BioWorld, third quarter EBP funding was 18.7 billion dollars, the largest quarter this year. Year to date, EBP funding through Q3 was up 8% versus prior year.

Markets for a multinational corporations in China. So all of those are headwinds plus the companies that were very active.

During the <unk> years are seeing you know dramatic pullbacks in Robyn when all of that is putting pressure on margins and as a result lost farmer has been and I would say unusually so a very aggressive in launching cost reduction programs now I said before that.

Speaker 4: are seeing dramatic pullbacks in revenue and all of that is putting pressure on margins. And as a result.

And as a result, large pharma has been, and I would say unusually so, very aggressive in launching cost-reduction programs. Now, I said before that that is not reflected. So far, we haven't seen that in the R&D side of the house.

Speaker 4: large pharma has been, and I would say unusually so, very aggressive in launching cost reduction programs. Now, I said before that that is not reflected in the cost reduction program.

Is not reflected so far we haven't seen that in the R&D side of the house again, I I I want to reiterate very strong was trying to <unk> good momentum into business and all the matrix show that there is no slow down there again not surprising it's a long cycle business. However, we.

Speaker 4: So far, we haven't seen that in the R&D side of the house. Again, I want to reiterate very strong strength, I mean, a good momentum in the business.

Operator: Again, I want to reiterate very strong strength. I mean, good momentum in the business, and all the metrics show that there is no slowdown there. Again, not surprising. It's a long-cycle business. However, we're bearing the brunt of those cost-reduction initiatives on the TAS segment, where we see that projects that should take a certain amount of time are taking a lot more time to get decided or awarded. We see our clients negotiating on terms a lot harder than they ever were. All of that has caused us to come short on the TAS segment in our revenues. But again, we're confident that this will rebound. We know this because the pipelines continue to be very strong on the TAS segment.

Again, I want to reiterate very strong strength. I mean, good momentum in the business, and all the metrics show that there is no slowdown there. Again, not surprising. It's a long-cycle business. However, we're bearing the brunt of those cost-reduction initiatives on the TAS segment, where we see that projects that should take a certain amount of time are taking a lot more time to get decided or awarded. We see our clients negotiating on terms a lot harder than they ever were.

Speaker 4: and all the metrics show that there is no slow down there. Again, not surprising, it's a long cycle business.

Speaker 4: However, we bearing the brunt of those cost reduction initiatives on the task segments where we see that

Bearing the brunt of those cost reduction initiatives.

Ari Bousbib: If you look at the first half large former R&D spend, it was above 20% of net revenues highlighting continued strong R&D activity within large former as well. Based on these indicators, the clinical trial industry remains healthy. Our strong market position, market wins scale and differentiated offerings give us confidence that our R&D as business will continue to deliver above market growth.

On the task segments, where we see that projects that this should take a certain amount of time or taking a lot more time to get decided or Walden and we see your clients negotiating on terms.

Speaker 4: projects that should take certain amount of time are taking a lot more time to get decided or awarded and we see our clients negotiating on terms a lot a lot harder than they ever were. And all of that has caused us to come short on the tal segment in our revenues but again we're confident that this is real rebound. We know this because the pipelines continue to be very strong.

A lot harder than they are of a work and all of that has caused us to consult on the task segment's revenues, but again with coffee then that this is will rebound. We know these because the pipelines continued to be very strong on the tiles segments and we look.

All of that has caused us to come short on the TAS segment in our revenues. But again, we're confident that this will rebound. We know this because the pipelines continue to be very strong on the TAS segment.

Ari Bousbib: Turning now to TAS, on the commercial side of our business we are obviously facing a tougher macro environment. Our clients remain cautious with their spending and have extended their decision making timelines beyond what we would have normally expected. I'm sure you also saw that several large farmers have announced significant cost reduction programs, and obviously we are a significant vendor to large farmers. Now we had anticipated to see improvements as we progress through the year, specifically in the quarter, we usually see activity pick up in September after the slower July August summer months.

Speaker 4: on the task segments and we if you look back at every time there was a

Operator: And if you look back at every time there was a pullback of sorts from large pharma in history, whether you go back to the 2008, 2010 period, or anytime some big legislation was enacted, there was always a little bit of a pullback, and then it came back. The industry is very innovative and comes back roaring, and our business goes along with it. So we're confident it will come back sometime in 2024. Thank you, Elizabeth. Thank you. Your next question comes from the line of Charles Rhyee with TD Cowen. Please go ahead. Yeah, thanks for taking the question. Just wanted to follow up on the TAS segment here. You talked about sort of longer timelines, but when you're in discussions with clients, do they continue to express an intention to kind of continue with the projects, or are things sort of just on hold?

And if you look back at every time there was a pullback of sorts from large pharma in history, whether you go back to the 2008, 2010 period, or anytime some big legislation was enacted, there was always a little bit of a pullback, and then it came back. The industry is very innovative and comes back roaring, and our business goes along with it. So we're confident it will come back sometime in 2024. Thank you, Elizabeth.

Back at every time there was a.

Speaker 4: a pullback of sorts from large farmers in history, whether you go back to the 2008-10 period or any time some big legislation was enacted, there was always a little bit of a pullback and then it came back, the company industry is very innovative.

Pull back of sauce from large farmer in history, whether you go back to the 2008 10 period or.

Anytime some big legislation was enacted there was always a little bit of a pull back and then it came back the company the industry is very innovative.

Speaker 4: and comes back rowing and our business goes along with it. So we confident it will come back.

And it comes back row ringing our business goes along with it. So we can't be done this will come back.

Speaker 4: sometime in 24. Thank you Elizabeth.

Sometime in 24, Thank you Elizabeth.

Thank you.

Operator: Your next question comes from the line of Charles Rhyee with TD Cowen. Please go ahead.

Okay.

Speaker 2: Your next question, Council No. 1 of Charles Rhee with 2D Cowan, please go ahead.

Your next question comes from the line of Charles Free with T. D. Counting. Please go ahead.

Charles Rhyee: Yeah, thanks for taking the question. Just wanted to follow up on the TAS segment here. You talked about sort of longer timelines, but when you're in discussions with clients, do they continue to express an intention to kind of continue with the projects, or are things sort of just on hold?

Speaker 7: Yeah, thanks for taking the question. Just wanted to follow up on the task segment here. You talked about sort of longer timelines. But when you're in discussions with clients, do they continue to express an intention to kind of continue with the projects? Or are things sort of just on hold? And how much of this is, you mentioned the IRA. How much would you attribute to sort of the pharma companies?

Yeah. Thanks for taking the question I just wanted to follow up.

On the on the task segment here, you know you talked about for a longer time lines, but when you're in discussions with clients do they continue to express an attention to kind of continue with the projects or is are things or just on hold and how much of this as you mentioned the I R. A you know how much would you attribute to.

Ari Bousbib: It didn't happen. While we still had growth for the segment as a whole, we experienced further declines in our analytics and consulting business, somewhat slower than expected growth in the discretionary parts of our real-world business, as well as some impact from the China situation. While the acceleration we are anticipating is staking longer than expected, based on our pipelines, we remain confident that there will be a rebound and demand sometime in 2024.

Operator: And how much of this is, you mentioned, the IRA? How much would you attribute to sort of these pharma companies kind of reviewing pipelines and projects overall? And do you have a sense on how long that kind of process could take? You mentioned sort of reacceleration sometime in 2024, but do you think that's early next year, or could that stretch into later next year? Thanks. Yeah. Well, thank you, Charles. I mean, look, I want to distinguish again between the clinical development side of the house and the commercial shorter cycle part of the house, where there are more pockets of spend that are more discretionary from a timeline standpoint. So again, on the clinical side of the house, yes, there are reviews of pipelines and so on, and which molecules are worthwhile developing. There's more analysis.

And how much of this is, you mentioned, the IRA? How much would you attribute to sort of these pharma companies kind of reviewing pipelines and projects overall? And do you have a sense on how long that kind of process could take? You mentioned sort of reacceleration sometime in 2024, but do you think that's early next year, or could that stretch into later next year? Thanks.

Sort of you know these farm accompanies.

Speaker 7: kind of reviewing pipelines and projects overall. And you have a sense on how long that kind of process could take. You mentioned sort of real acceleration sometime in 24, but do you think that's early next year or could that stretch until later next year? Yeah, well thank you.

Reviewing pipelines and projects overall in and and do you have a sense of how long that kind of process could take you. You mentioned you know sort of Reacceleration, sometimes 24, but do you think that's early next year or cut that stretch into later next year. Thanks.

Ari Bousbib: Yeah. Well, thank you, Charles. I mean, look, I want to distinguish again between the clinical development side of the house and the commercial shorter cycle part of the house, where there are more pockets of spend that are more discretionary from a timeline standpoint. So again, on the clinical side of the house, yes, there are reviews of pipelines and so on, and which molecules are worthwhile developing. There's more analysis.

Yeah, well, thank you Charles I mean look.

Ari Bousbib: We know this because the pipeline of opportunities remains strong, even as decision timelines are elongated and negotiations with our customers have become more difficult. We also know this because historically, going back 25 years every time there was a pullback in spend on the commercial side, the industry adapts and comes back within a year or two.

Speaker 4: I want to distinguish again between the clinical development side of the house and the commercial shorter cycle part of the house where there are more pockets of spend that are more discretionary from a timeline standpoint. So again, on the clinical side of the house...

I wanted to distinguish again between the clinical development side of the house and the commercial shorter cycle part of the house, where there are more.

<unk> of spam there are more discretionary from the time <unk>. So again on the clinical side of the house.

Speaker 4: Yes, there are reviews of pipelines and so on, and you know, which molecules are worthwhile developing. There's more analysis. But this is at the early, early stage of the process. As you know, we are primarily, almost entirely, a phase three clinical trial company. And so we are not seeing that and we would not be seeing that for another several years if it were to affect.

Yes. They are all reviews of pipelines and so on and you know which molecules are worthwhile developing there's no. One that is but he sees that the early early stage of the process. As you know we are primary almost entirely of faith Street.

Ari Bousbib: With this that context, let's now review the third quarter results. Revenue for the third quarter grew 4.9% on a reported basis, 4.1% at constant currency. Compared to last year and excluding COVID-related work from both periods, we grew the top line approximately 8.5% on a constant currency basis and that includes approximately a point and a half of contribution from acquisitions. Third quarter adjusted EBITDA increased 9.1%, driven by revenue growth and ongoing cost management discipline.

Operator: But this is at the early, early stage of the process. As you know, we are primarily, almost entirely, a phase three clinical trial company. And so we are not seeing that, and we would not be seeing that for another several years if it were to affect the pipeline. I remind you that the number of molecules coming down the pipe is at a record high. The number of FDA approvals is at a record high. And all of that bodes well for our clinical business. And all the metrics that we see from funding to RFPs to awards to backlog and bookings are very, very strong. Once again, we had a record historic high in services bookings in the quarter of $2.3 billion, representing a book-to-bill ratio of 1.4, excluding pass-throughs. So that's for the clinical side of the house.

But this is at the early, early stage of the process. As you know, we are primarily, almost entirely, a phase III clinical trial company. And so we are not seeing that, and we would not be seeing that for another several years if it were to affect the pipeline. I remind you that the number of molecules coming down the pipe is at a record high. The number of FDA approvals is at a record high.

Clinical trial of company and so we are not seeing that and we will not be seeing that for another several years, if it were to affect.

Speaker 4: the pipeline. I remind you that the number of molecules coming down the pipe is at a record high. The number of FDA approvals is at a record high. And all of that bodes well for our clinical business. And all the metrics that we see from funding

The pipeline I remind you that the number of molecules coming down the pipe is at a record high the Denver of a V approval is at a record high and all of that bodes well for all clinical business in order to make sure that we see from funding.

And all of that bodes well for our clinical business. And all the metrics that we see from funding to RFPs to awards to backlog and bookings are very, very strong. Once again, we had a record historic high in services bookings in the quarter of $2.3 billion, representing a book-to-bill ratio of 1.4x, excluding pass-throughs. So that's for the clinical side of the house.

Speaker 4: to RFPs, to awards, to backlog and bookings are very, very strong. Once again.

R. S. P's two awards to backlog and bookings are very very strong once again.

Ari Bousbib: Third quarter adjusted diluted EPS of $2.49 faced the ongoing headwind of the step-up in interest expense and the UK corporate tax rate. If you exclude the impact of these non-operational items, our adjusted diluted EPS growth underlying was 13%.

Speaker 4: We had a record historic high in services bookings in the quarter of $2.3 billion, representing a book-to-be ratio of 1.4, excluding pass-throughs. So that's for the clinical side of the house. We have not seen the impact of any revisions or rethinking of pipelines so far.

We had <unk> historically historic high in services bookings in the quarter of $2.3 billion, representing a book to be the ratio of 1.4, excluding <unk>. So that's where the clinical side of the house, we have not seen the impact of any revisions or.

Operator: We have not seen the impact of any revisions or rethinking of pipelines so far. On the commercial side, that's the area where we are seeing an impact of our clients being more cautious, more conservative, stepping back from some of the projects they were planning to do. But for the most part, what we do, except again for the discretionary part, must be done. There is discretion with respect to timing. And of course, clients are being more aggressive in terms of seeking price reductions, better terms, and so on. The pipelines that we have indicate that demand is still there. To your question, when people say to us they will no longer do a project, it's no longer in our pipeline. But if it remains in our pipeline, then it means the client still intends to do it.

We have not seen the impact of any revisions or rethinking of pipelines so far. On the commercial side, that's the area where we are seeing an impact of our clients being more cautious, more conservative, stepping back from some of the projects they were planning to do. But for the most part, what we do, except again for the discretionary part, must be done. There is discretion with respect to timing.

Ari Bousbib: Let me share a few highlights of business activity in the quarter and let me start with TAS. This quarter, IQVIA was awarded seven note worthy analytics contracts to support our clients go-to-market strategies. For example, the NBP clients selected IQVIA to provide analytics around keep subscriber and pay your trend for their women's health products. In another significant win this quarter, IQVIA secured a large US data analytics contract with a top 10 farmer client that had been buying from a competitor for over a decade.

Rethinking of pipelines so far on the commercial side, that's the area, where we are seeing an impact of our clients being more cautious more conservative stepping back from some of the projects. They were planning to do but for the most spoiled.

Speaker 4: On the commercial side, that's the area where we are seeing an impact of our clients being more cautious, more conservative, stepping back from some of the projects they were planning to do, but for the most part.

Speaker 4: What we do, except again for the discretionary part, must be done. There is discretion with respect to timing. And of course, clients are being more aggressive in terms of seeking price reductions and better terms and so on.

We do accept again for the discretionary report.

Uhm must be done there is discretion with respect to timing and of course clients are being more aggressive in terms of seeking a price reductions in better terms and so on the pipelines that we have indicated that the man is still there.

And of course, clients are being more aggressive in terms of seeking price reductions, better terms, and so on. The pipelines that we have indicate that demand is still there. To your question, when people say to us they will no longer do a project, it's no longer in our pipeline. But if it remains in our pipeline, then it means the client still intends to do it.

Speaker 4: the pipelines that we have indicate that the man is still there.

Ari Bousbib: We also received an award from an EVP client to support the launch of their first branded product into the diabetes market. This will be an end-to-end launch solution including field reps, insight sales reps, OCE, information management infrastructure, data analytics, commercial compliance and copy car operations. Also in the quarter, I'm sure you saw that we received an award from Sanofi to deploy our OCE platform within the Middle East and Africa markets. Sanofi has been using Iqvia in many markets around the world to support their HCP engagements.

Speaker 4: To your question, when people say to us that we no longer do a project, it's no longer in our pipeline.

To your question you know when people say to us that we no longer do a project, it's no longer in our pipeline.

Speaker 4: But if it remains in our pipeline, then it means the client still intends to do it. It's just that the timeline for decision making has been pushed to the right.

But if it's amazing all pipeline.

The client stealing tends to do it it's just that the timeline for decision, making has been pushed through the right what.

Operator: It's just that the timeline for decision-making has been pushed to the right. What explains it? It's, again, general concerns about the economy, general concerns about the macro geopolitical issues, the pressures resulting from sharp revenue declines post-COVID, and what that entails from a margin point of view. As I mentioned in my introductory remarks, we are a very large vendor to pharma and to large pharma in particular. When large pharma seeks to improve their margins, they seek to reduce costs. Obviously, they come to us for further reductions. That elongates timelines. Of course, it erodes pricing as well on our side. All of that has resulted in us coming short on our revenues in TAS, along with, as we mentioned in introductory remarks, the significant FX headwinds versus what we had guided to before. So that's the environment. Yeah. Thank you very much.

It's just that the timeline for decision-making has been pushed to the right. What explains it? It's, again, general concerns about the economy, general concerns about the macro geopolitical issues, the pressures resulting from sharp revenue declines post-COVID, and what that entails from a margin point of view. As I mentioned in my introductory remarks, we are a very large vendor to pharma and to large pharma in particular. When large pharma seeks to improve their margins, they seek to reduce costs.

Speaker 4: What explains it? It's again, general concerns about the economy, general concerns about the macro geopolitical issues, the pressures resulting from sharp revenue declines post COVID.

What explains it.

Again general concerns about the economy general concerns about the mackerel geopolitical issues the pressures, resulting from sharp revenue declines post COVID-19.

Speaker 4: and what that entails from a margin point of view. As I mentioned in my introductory remarks, we are a very large vendor to pharma and to large pharma, in particular. And it's.

And what that entails from an <unk> point of view as I mentioned in my introductory remarks, we are very large vendor too.

Ari Bousbib: On the tech side, we've been getting some questions about our partnership with Salesforce and I just want to confirm that Iqvia has been a key life sciences partner to Salesforce for many years now with offerings that span from clinical to commercial.

Two former and two large format in particular.

And you know when are from a six to improve their <unk> to reduce costs and obviously they come to us for further reductions in that elongate.

Speaker 4: to improve their margins, they seek to reduce costs, and obviously they come to us for further reductions and that elongates.

Obviously, they come to us for further reductions. That elongates timelines. Of course, it erodes pricing as well on our side. All of that has resulted in us coming short on our revenues in TAS, along with, as we mentioned in introductory remarks, the significant FX headwinds versus what we had guided to before. So that's the environment.

Ari Bousbib: And we plan to continue the strong partnership with Salesforce, combining our life sciences domain expertise and intelligence with Salesforce technologies and platforms. Moving now to real world, we were awarded multiple rare disease studies from both large-former and biotech clients. Highlighting our expertise and differentiated offerings within this growing therapeutic area, including innovative study design, patient recruitment and AI enable technology to provide unique solutions. Couple of examples. The top 20 large-former awarded Iqvia a 10-year study to improve patient treatments for a rare genetic liver disease.

Speaker 4: timelines and, of course, erodes pricing as well on our side, all of that has resulted in us coming short on our revenues in TAS along with, as we mentioned in introductory remarks, the significant FX headwinds versus what we had guided to before. So that's the environment. Yeah. Sorry, I meant portfolio review.

Timelines.

And of course, it will it's pricey as well on our side all of that has resulted in us coming short on our <unk> along with as we mentioned an introductory remarks, the significant effects headwinds versus what we had guided to before so that's the environment yeah. Thanks for <unk>.

Charles Rhyee: Yeah.

Ari Bousbib: Thank you [crosstalk].

Operator: Sorry, I meant portfolio review, but. Portfolio, I mean, on the R&D side? No, no, on the commercialization. Sorry, I misspoke. I meant, how much has the IRA impacted? Sort of, has that had an effect on when pharma has portfolio reviews and where they put their discretionary spend? But it sounds like you're saying it's more just the general macro environment that's had an impact on discussions. Yeah. I mean, the IRA hasn't had any concrete, significant, concrete impact yet on the market. This is all based on hypothetical developments and down the line. So that just adds another cloud of uncertainty. And in anticipation of that uncertainty, that causes management teams to appropriately seek cost containment. That's all. Okay. Okay. Appreciate it. Thank you. Your next question comes from the line of Dan Leonard with UBS. Please go ahead. Thank you.

Charles Rhyee: Sorry, I meant portfolio review, but.

Q, but.

Ari Bousbib: Portfolio, I mean, on the R&D side?

Both 40 on you know on the on the R&D site.

Charles Rhyee: No, no, on the commercialization. Sorry, I misspoke. I meant, how much has the IRA impacted? Sort of, has that had an effect on when pharma has portfolio reviews and where they put their discretionary spend? But it sounds like you're saying it's more just the general macro environment that's had an impact on discussions.

Speaker 4: No, no. On the commercialization side, I misspoke. I meant, you know, how much has the IRA impacted sort of as they, has that had an effect on when pharmacists have portfolio reviews and where they put their discretionary spend? But it sounds like you're saying it's more just the general macro environment that's having an impact on discretionary spend. The IRA hasn't had any concrete, significant, concrete impact yet on the market. This is all

No no on the commercialization sorry, I misspoke I meant you know how much is the impact of sort of.

How does that had an effect on when farmers are perfectly reviews, and and where they put their discretionary spend but it sounds like you're saying, it's more just the general macro environment, Yeah and in fact.

Ari Bousbib: Yeah. I mean, the IRA hasn't had any concrete, significant, concrete impact yet on the market. This is all based on hypothetical developments and down the line. So that just adds another cloud of uncertainty. And in anticipation of that uncertainty, that causes management teams to appropriately seek cost containment. That's all.

The I R. A hasn't had any concrete significant concrete impact yet.

Ari Bousbib: A Japanese EDP client awarded Iqvia two large post-marketing surveillance studies on rare diseases in the circulatory nervous and muscular systems. Moving now to RNDS, we entered into a strategic collaboration with the Coalition for Epidemic Preparedness Innovations, CEPI aimed at enhancing the world's ability to rapidly conduct clinical research for vaccines and other biological countermeasures against emerging infectious diseases. This collaboration is a key neighbor of CEPI's mission goal, which is sponsored by the G7 and G20 countries, to develop safe, effective and globally accessible vaccines against emerging disease outbreaks within 100 days.

On the market. This is all.

Speaker 4: you know, based on hypothetical developments and down the line. So, that just adds another cloud of uncertainty, and in anticipation of that uncertainty, that causes management teams to appropriately seek, you know, cost containment. That's all.

You know based on hypothetical developments and down the line so that just adds another cloud.

Uncertainty and in anticipation of that uncertainty that causes management teams to appropriately seek it'll cost containment.

Charles Rhyee: Okay. Okay. Appreciate it. Thank you.

That's all okay. Okay I appreciate it thank you.

Operator: Your next question comes from the line of Dan Leonard with UBS. Please go ahead.

Speaker 2: Your next question comes from the line of Dan Leonard with UBS, please go ahead.

Your next question comes from the line again, my <unk> with you B S. Please go ahead.

Dan Leonard: Thank you. I just wanted to circle back to your 2024 framing commentary. That mid-single-digit growth figure, can you speak to your expectations between the TAS segment and the R&DS segment? And then in R&DS in 2024, do you expect any meaningful difference in growth rates between the direct fee revenue and total revenue? Thank you.

Speaker 8: Thank you. I just wanted to circle back to your 2024 framing commentary, that mid-single-digit growth figure. Can you speak to your expectations between the TAS segment and the R&DS segment? And then in R&DS in 2024, do you expect any meaningful difference in growth rates between the direct fee revenue and total revenue? Thank you.

Thank you I I just wanted to circle back to your 2024 framing commentary that mid single digit growth figure can you speak to your expectations between the the Taz segment in the R&D S segment, and then in R and D. As in 2024 do you expect any meaningful difference in growth rates between the direct fee.

Operator: I just wanted to circle back to your 2024 framing commentary. That mid-single-digit growth figure, can you speak to your expectations between the TAS segment and the R&DS segment? And then in R&DS in 2024, do you expect any meaningful difference in growth rates between the direct fee revenue and total revenue? Thank you. So again, this is a very we thought it would be helpful just because there's uncertainty, and you will recall that even in the at the peak of COVID, we decided to give you guidance early. We're doing this because we hope that that's helpful to you. Now, it's an initial outlook based on where we are in our planning process. We have not completed that planning process.

Ari Bousbib: We've also entered into a innovative strategic collaboration with Argenics, a global immunology biotech company, leveraging our connected intelligence capabilities we bring together and to end asset development services, ranging from regulatory to market authorization to integrate a technology enable pharmacovigilance safety tracking. This will allow Argenics to accelerate the market launch of new rare disease therapies to autoimmune patients. In the quarter, a top 10 former client renewed their FSP partnership with Iqvia as they looked to design along the new clinical monitoring model. [inaudible] Iqvia was selected for our strategic design and operational expertise in oncology, including our ability to manage multiple large complex trials and our experience managing the unique safety profile of these molecules.

Revenue in total revenue thank you.

Ari Bousbib: Again, this is a very we thought it would be helpful just because there's uncertainty, and you will recall that even in the at the peak of COVID, we decided to give you guidance early. We're doing this because we hope that that's helpful to you. Now, it's an initial outlook based on where we are in our planning process. We have not completed that planning process.

So again this is a very we thought it would be helpful. Just because there is uncertainty uncertainty and you will recall that even in the you know at the peak of Covid, We decided to just give you guidance.

Speaker 4: So again, this is a very, we thought it would be helpful just because there's uncertainty and you will recall that even in the, you know, at the peak of COVID, we decided to give you guidance early and we're doing this because we hope that that's helpful to you. Now it's an initial outlook based on where we are in our planning process. We have not completed that planning process.

Early and we're doing this because we hold that that's helpful to you know it's an initial outlook based on where we are in our planning process. We have not completed is planning process. So I would caution you that this is again preliminary and we will come back as is our custom.

Speaker 4: So I would caution you that this is again preliminary and we will come back as is our custom when we release full year earnings early in 24 with detailed and precise guidance by segments, et cetera. Just on your question, we are guiding to meet single digit overall revenue growth. That includes $300 million of step down from COVID

Operator: So I would caution you that this is, again, preliminary, and we will come back, as is our custom, when we release full-year earnings early in 2024 with detailed and precise guidance by segments, etc. Just on your question, we are guiding to mid-single-digit overall revenue growth. That includes $300 million of step-down from COVID. And I think that's essentially all in R&DS. So if you added that back to our total revenues, that would be another couple of hundred basis points on top of that. And of course, we expect 100 basis points of foreign exchange headwinds, assuming FX rate remains what they are today. So when we say mid-single digits, that's really on a reported basis.

So I would caution you that this is, again, preliminary, and we will come back, as is our custom, when we release full-year earnings early in 2024 with detailed and precise guidance by segments, etc. Just on your question, we are guiding to mid-single-digit overall revenue growth. That includes $300 million of step-down from COVID. And I think that's essentially all in R&DS. So if you added that back to our total revenues, that would be another couple of hundred basis points on top of that.

When we released for your earnings early in 24 with detailed and precise guidance by segments et cetera, just on your question.

We are guiding to mid single digits overall revenue growth.

That includes $300 million of stepped down from <unk>.

Speaker 4: And I think that's essentially all in RMDS.

And I think that's essentially.

In Orange, Yes <unk>.

Speaker 4: So if you added that back to our total revenues, that would be another couple of hundred basis points on top of that. And of course, we have, we expect our hundred basis points of foreign exchange headwinds, assuming FX rate remains where they are today. So when we say meet single digits.

So if you added that back to our total revenues that would be another couple of hundred basis points on top of that and of course, we have we expect 100 basis points of foreign exchange of headwinds assuming ethics rate remains where they are today.

And of course, we expect 100 basis points of foreign exchange headwinds, assuming FX rate remains what they are today. So when we say mid-single digits, that's really on a reported basis.

So when we say mid single digits.

Speaker 4: that's really on a reported basis. Once you adjust for the COVID step down and effects, it's more high single digits, which I'm sure you agree for an about $15 billion revenue company is quite an achievement in the current environment. With respect to segment.

That's really on a reported basis once you.

Operator: Once you adjust for the COVID step-down and FX, it's more high single digits, which I'm sure you agree for a nearly $15 billion revenue company is quite an achievement in the current environment. With respect to segment growth, I think it's too early to give it to you. We obviously have an idea, but I mean, I just gave it to you. When we tell you that the COVID impact is 100% in R&DS, you could just assume that we are expecting, essentially for now, assume about the same across the segments. That is mid-single digits, I would say, okay, before the COVID adjustment. Thanks, Ari. As a reminder, we ask that you please limit your questions to one. Your next question will come from the line of David Windley with Jefferies. Please go ahead. Hi, good morning. Thanks for taking my question.

Once you adjust for the COVID step-down and FX, it's more high single digits, which I'm sure you agree for a nearly $15 billion revenue company is quite an achievement in the current environment. With respect to segment growth, I think it's too early to give it to you. We obviously have an idea, but I mean, I just gave it to you. When we tell you that the COVID impact is 100% in R&DS, you could just assume that we are expecting, essentially for now, assume about the same across the segments.

Ah just for the Covid step down and F X, it's more high single digits, which I'm sure you agree for in about 15 billion dollar revenue company is quite an achievement in the current environment.

With respect to segment Grove.

Speaker 4: I think it's too early to give it to you, we obviously have an idea, but what should we... I mean, I just gave it to you, you know, but when we...

I think it's too early to give it to you will obviously you have an idea, but where shall we I mean I just gave it to you would you know about what when we.

Speaker 4: When we tell you that the COVID impact is 100% in RNDS, you could just assume that we are expecting, essentially for now, assume about the same across the segments. That is, you know, mid-single digits, I would say, OK, before the COVID.

When we tell you that the Covid in fact is 100 per cent in Orange, Yes, you could just assume that we are expecting.

Essentially for now assume about the same across the segments that is you know mid single digits I would say.

That is mid-single digits, I would say, okay, before the COVID adjustment.

Okay before the Covid adjustment.

Dan Leonard: Thanks, Ari.

Ronald Bruehlman: With that, I will turn it over to Ron for more details on our financial performance. [inaudible] Year-to-date revenue of $11 billion, $116 million, grew 4.2% on a reported basis in 4.8% of constant currency, excluding all COVID-related work, constant currency growth was 11% year-to-date. Technology and analytic solutions revenue year-to-date was $4 billion, $331 million, up 2% reported in 2.4% of constant currency, and excluding all COVID-related work, growth at constant currency and tax year-to-date was 7%.

Thanks, sorry.

Operator: As a reminder, we ask that you please limit your questions to one. Your next question will come from the line of David Windley with Jefferies. Please go ahead.

Speaker 2: And as a reminder, we ask that you please limit your questions to one. Your next question will come from the line of David Winley with Jeffries. Please go ahead.

And as a reminder, we ask that you. Please send me your questions to <unk>. Your next question woke up on the line I'm David friendly with cafes. Please go ahead.

David Windley: Hi, good morning. Thanks for taking my question. Ari, I wanted to focus on margin. You commented in your prepared remarks about productivity initiatives that you took in the Q3. You're talking about the bookings mix being heavy to service. And so that could be beneficial in R&DS to evened-out growth.

Speaker 8: Hi. Good morning. Thanks for taking my question. Ari, I wanted to focus on margin. You commented in your prepared remarks about productivity initiatives that you took in the third quarter. You're talking about the bookings mix being heavy to service. And so, you know, that could be beneficial in R&DS to EBITDA growth.

Hi, Good morning, Thanks for taking my question already I wanted to focus on on margin you commented in your prepared remarks about productivity initiatives that you took in the third quarter, you're talking about the bookings Max Payne heavy to service and so you know that can be beneficial in R&D S. Two two <unk>.

Operator: Ari, I wanted to focus on margin. You commented in your prepared remarks about productivity initiatives that you took in the third quarter. You're talking about the bookings mix being heavy to service. And so that could be beneficial in R&DS to evened-out growth. Just wondered if you could talk kind of expansively about any further productivity initiatives that you might be able to take, and kind of what are the drivers to get you to that 50 basis points of evened-out margin expansion for next year. Thanks. Well, thank you. Look, I mean, the productivity initiatives I mentioned, not just in the third quarter. You will recall we started this towards the end of last year. That's what has led us to be able to address the revenue shortfall and not completely bear the brunt of that reduction falling through to EBITDA.

Speaker 8: I just wondered if you could talk kind of expansively about any further productivity initiatives that you might be able to take and kind of what are the drivers to get you to that 50 basis points of EBITDA margin expansion for next year.

Just wondered if you could talk kind of expansively about any further productivity initiatives that you might be able to take, and kind of what are the drivers to get you to that 50 basis points of evened-out margin expansion for next year. Thanks.

Just wondering if you could talk kind of expansively about any further productivity initiatives that you might be able to take in and kind of what are the drivers to get you to that 50 basis points of EBITDA margin expansion for next year. Thanks.

Ari Bousbib: Well, thank you. Look, I mean, the productivity initiatives I mentioned, not just in the Q3. You will recall we started this towards the end of last year. That's what has led us to be able to address the revenue shortfall and not completely bear the brunt of that reduction falling through to EBITDA.

Speaker 4: Well, thank you, David. Look, I mean the productivity initiatives I mentioned, not just in the third quarter. You will recall we started this towards the end of last year. That's what has led us to be able to address, you know, the revenue shortfall and not, you know, completely bear the brunt of that reduction falling through EBITDA.

Oh, Thank you look I mean, the the productivity and as soon as I mentioned not just in the throes <unk> you will recall we started this towards the end of last year. That's what has led us to be able to address you know the revenue shortfall and not you know completely bear the brunt.

Of that reduction falling through <unk>.

Speaker 4: we've been able to offset a lot of that headwind.

Operator: We've been able to offset a lot of that headwind with those cost reduction programs. It takes time. As you know, the actions that we took in Q3 are not going to bear a benefit until Q4, Q1, Q2 of next year. So we're constantly taking actions to restructure our overhead structure, to review our spans of control globally, to continue our offshoring programs, to review our infrastructure footprint. That includes real estate. It includes IT. It includes really all of that infrastructure that we need to run our business. All of those cost factors, along with the proper mix of insourcing, outsourcing, and as I mentioned, a continued offshoring of certain activities and taking advantage of labor arbitrage among our different centers, whether it's in the Philippines, in India, in Bangladesh, in South America, etc., are being done on an ongoing basis.

We've been able to offset a lot of that headwind with those cost reduction programs. It takes time. As you know, the actions that we took in Q3 are not going to bear a benefit until Q4, Q1, Q2 of next year. So we're constantly taking actions to restructure our overhead structure, to review our spans of control globally, to continue our offshoring programs, to review our infrastructure footprint. That includes real estate. It includes IT. It includes really all of that infrastructure that we need to run our business.

We've been able to upset a lot of that headwinds with all those cost reduction programs. It takes fine you know as you know if we <unk>. The actions that we took in Q3 are not gonna be you know <unk> benefits and thank you for Q1 Q2 of next year. So.

Speaker 4: without those cost reduction programs, it takes time, you know, as you know.

Speaker 4: If the actions that we took in Q3 are not going to be.

Speaker 4: you know, their benefit until Q4, Q1, Q2 of next year. So we constantly taking actions to restructure our overhead structure.

We <unk>.

<unk> cost to keep taking actions to restructure our overhead structure to review spans of control globally to you know continue our offshoring programs to review our infrastructure footprint that includes real estate.

Speaker 4: to review our spans of control globally.

Speaker 4: to continue our offshoring programs.

Speaker 4: to review our infrastructure footprint that includes real estate, it includes IT, it includes really all of that infrastructure that we need to run our business.

<unk> is includes iced tea. It includes really all of that infrastructure that so we need to run our business and all of those cost factors.

Speaker 4: and all of those cost factors along with.

All of those cost factors, along with the proper mix of insourcing, outsourcing, and as I mentioned, a continued offshoring of certain activities and taking advantage of labor arbitrage among our different centers, whether it's in the Philippines, in India, in Bangladesh, in South America, etc., are being done on an ongoing basis.

Along with that you know because of the proper beaks of insourcing outsourcing and as I mentioned, a continued offshoring of certain activities and taking advantage of our labor arbitrage among all different centers, whether it's in the Philippines and India.

Speaker 4: the proper mix of insourcing, outsourcing, and as I mentioned.

Speaker 4: a continued upshowing of certain activities and taking advantage of labor arbitrage among our different centers, whether it's in the Philippines, in India, in Bangladesh, in South America, etc. All of those things are being done on an ongoing basis and we see the benefit in our margins this year. The actions we took, for example, in the third quarter, the carrier...

Ronald Bruehlman: R&D solutions year-to-date revenue of $6 billion, $244 million, was up 6.5% at actual FX rates, and 6.8% at constant currency, excluding all COVID-related work, growth at constant currency and R&D was 14% year-to-date. And a finally contract sales and medical solutions year-to-date revenue of $541 million to client 3.6% reported and increased 1.2% at constant currency. To move down the P&L, adjusted EBITDA in the quarter was $888 million, representing growth of 9.1% while year-to-date adjusted EBITDA was $2,603 million, up 7.3% year-to-date.

I'm glad this in South America et cetera, all of those things are.

Are being done on an ongoing basis and we see the benefits you know <unk> and you know <unk>.

Operator: And we see the benefit in our margins this year. And the actions we took, for example, in the third quarter, the carryover benefit will materialize in Q4 and in following quarters during 2024. The reason we feel confident about a 50 basis points margin expansion in 2024 is because we see that it's the carryover of the actions we took this year that will benefit on a full-year basis 2024. And of course, we don't intend to stop those actions selectively. That's great. Thank you. I'll stick to one. Thanks. Your next question will come from the line of Justin Bowers with Deutsche Bank. Please go ahead. Justin, your line might be on mute. Thank you. Good morning, everyone. So I just wanted to take a step back.

Operator: And we see the benefit in our margins this year. And the actions we took, for example, in the Q3, the carryover benefit will materialize in Q4 and in following quarters during 2024. The reason we feel confident about a 50 basis points margin expansion in 2024 is because we see that it's the carryover of the actions we took this year that will benefit on a full-year basis 2024. And of course, we don't intend to stop those actions selectively.

The actions we too for example in the fourth quarter.

The carryover.

Speaker 4: benefit will materialize in Q4 and in the following quarters during 2024. The reason we feel confident about 50 basis points margin expansion in 2024 is because we see

<unk> will materialize in queue for so.

And in following quarters. During 2024. The reason, we feel confident about 50 basis points margin expansion in 2024 is because we see.

Speaker 9: that it's the carryover of the actions we took this year that will benefit on a full year basis 2024. And of course we don't intend to stop those actions selectively.

<unk>, it's the carryover of the actions we took this year that will benefits on the full your bases 2024 and of course, we don't intend to stop those actions selective.

Ronald Bruehlman: Third quarter gap net income was $303 million, and gap deluded earnings per share was $1.63. Year-to-date gap net income was $889 billion, or $4.76 of earnings per deluded share. Adjusted net income was $4.62 million for the third quarter, and adjusted deluded earnings per share was $2.49. Year-to-date adjusted net income was $1.378 million, or $7.37 for deluded share. Excluding the year-to-year impact of the step-up and interest rates, and the increase in the UK corporate tax rate, adjusted deluded earnings per share grew 13% in the third quarter, and 12% year-to-date. Now, it's already reviewed R&D solutions delivered another strong quarter of bookings. Backlog at September 30 stood at $28.8 billion, up almost 12% year-to-year, and 33% higher in the last three years.

David Windley: That's great. Thank you. I'll stick to one. Thanks.

That's great. Thank you I'll state of one thanks.

Operator: Your next question will come from the line of Justin Bowers with Deutsche Bank. Please go ahead. Justin, your line might be on mute.

Speaker 2: Your next question will come from the line of Justin Bowers with Deutsche Bank. Please go ahead.

Your next question will come from the line of Jackson powers to reach bank. Please come back.

Yeah, Hi, good morning, everyone.

Justin Bowers: Thank you. Good morning, everyone. So I just wanted to take a step back. With respect to some of the cost-cutting programs that we've seen large pharma announce, what is IQVIA's opportunity to sort of participate in some of that and help drive some of those savings, whether it's in sort of R&DS or TAS? Then secondarily, for the outlook for 2024, what's the M&A assumption embedded in that growth rate?

Speaker 10: Thank you and good morning everyone. So just wanted to take a step back and with respect to some of the cost cutting programs that that we've seen large pharma announce what is what is like to be as opportunity to sort of.

Thank you and good morning, everyone. So just wanted to take a step back and with respect to some of the cost cutting programs that that we've seen large farm.

Operator: With respect to some of the cost-cutting programs that we've seen large pharma announce, what is IQVIA's opportunity to sort of participate in some of that and help drive some of those savings, whether it's in sort of R&DS or TAS? Then secondarily, for the outlook for 2024, what's the M&A assumption embedded in that growth rate? Thank you, Justin, for your question. Yes, we are actively engaged with our customers to help them with their cost reduction programs. Look, we have to. We are a large vendor to large pharma across the board, clinical and TAS. And they come to us and ask us to help them. So we have an opportunity to do that. Obviously, it affects our revenue growth. That's primarily the case in TAS because that's where the pricing changes and the renegotiated terms impact us almost immediately.

Announce what is.

What is curious opportunity to sort of.

Speaker 10: Participate in some of that and help drive some of those savings, you know, whether it's in sort of RDS or TAS.

Participate in some of that and help drive some of those savings.

Whether it's in sort of a R D S or taz.

And then.

Speaker 10: Secondarily, for the outlook for 2024, what's the M&A assumption embedded in that growth rate?

Secondarily on on for the outlook for 2024, what is what's the M&A assumption embedded in that grocery.

Ari Bousbib: Thank you, Justin, for your question. Yes, we are actively engaged with our customers to help them with their cost reduction programs. Look, we have to. We are a large vendor to large pharma across the board, clinical and TAS. And they come to us and ask us to help them. So we have an opportunity to do that. Obviously, it affects our revenue growth. That's primarily the case in TAS because that's where the pricing changes and the renegotiated terms impact us almost immediately.

Speaker 4: Thank you, Justin, for your question. Yes, we are actively engaged with our customers to help them with their cost reduction programs. Look, we have to. We are a large vendor to large pharma across the board, clinical and TAS, and they come to us and ask us to help them.

Thank you Justin.

For your question, Yes, we are actively engage with our customers to help them with a cost reduction programs look [laughter]. We have to we are a large vendor to lodge a formal across the board clinical and does.

Ronald Bruehlman: Let's review the balance sheet. As of September 30 at the cash and cash equivalence, total $1.224 million in gross debt was $13.631 million, and that resulted in net debt of $12.407 million. Our net leverage ratio ended the quarter at 3.52 times trailing 12-month adjusted EBITDA. Third quarter cash flow from operations was $583 million, and capital expenditures were $146 million, resulting in free cash flow of $437 million. Now, you saw in the quarter that we repurchased $144 million of our shares, which put their year-to-date share repurchased activity just slightly below $800 million. This leads us with just under $2.6 billion of share repurchased authorization remaining under the current problem.

And they come to us and ask us to help them.

Speaker 4: So, you know, we have an opportunity to do that. Obviously, it affects our revenue growth. That's primarily the case in TAZ because that's where, you know, the pricing changes and the renegotiated terms impact us, you know, almost immediately. You know, let's so...

So you know we have an opportunity to do that obviously it affects our revenue growth that's primarily the case in <unk>, because that's where you know the.

The pricing changes and renegotiate the terms in fact US you know <unk> almost immediately.

You know less so in our end yes.

Operator: Less so in R&DS, but mostly in TAS. Now, the opportunity, if you will, for us is that in those conversations, we try to offer more services. That has always been the case. That's a traditional way of engaging with our clients when they seek cost reductions. We try to capture a bigger share of their spend in exchange for being able to deliver those services at a lower price point. And so the benefit for us is longer term. We get a bigger piece as they give us more volume. We've seen that happen, frankly, on the commercial side and on the R&DS side over the past five, six years, and certainly since the merger.

Less so in R&DS, but mostly in TAS. Now, the opportunity, if you will, for us is that in those conversations, we try to offer more services. That has always been the case. That's a traditional way of engaging with our clients when they seek cost reductions. We try to capture a bigger share of their spend in exchange for being able to deliver those services at a lower price point. And so the benefit for us is longer term.

Speaker 4: but mostly in TAS. Now, the opportunity, if you will, for us, is that in those conversations, we try to offer more services that has always been the case. That's a traditional way of engaging with our clients when they see...

But mostly <unk> now the opportunity if you will for US is that in those conversations we tried to offer.

You know more services and that has always been the case, that's the traditional way of engaging with our clients when they seek.

Ronald Bruehlman: Okay, let's turn to guidance. We're updating our guidance to reflect both the slower growth and the task segment and the headwind from foreign exchange rates compared to our previous guide. We currently expect revenue to be between $14 billion, $885 million, and $14 billion, $920 million, which represents a year-over-year growth of 3.3 to 3.5%. Excluding approximately $600 million of COVID-related revenue step down versus 2022, this guidance represents growth at constant currency of approximately 9%, including about 140 basis points of contribution from acquisition.

Speaker 4: cost reductions, we try to capture a bigger share of their spend in exchange for being able to deliver those services at a lower price point.

Cost reductions you know we tried to.

Gotcha, a bigger share of their spend in exchange for being able to deliver those services at a lower.

Price points.

Speaker 4: And so the benefit for us is longer term, we get a bigger piece as they give us more volume. We've seen that happen, frankly, on the commercial side and on the R&D side over the past five, six years, and certainly since the merger.

And so the benefits for us is longer term, we get a bigger piece as they give.

We get a bigger piece as they give us more volume. We've seen that happen, frankly, on the commercial side and on the R&DS side over the past five, six years, and certainly since the merger.

Give us some more volume we've seen that happen frankly on the commercial side that on the <unk> side over the past five six years and certainly sees the merger.

Speaker 4: And we certainly hope that that will materialize, but it'll take a couple of years to materialize because when clients need to switch vendors.

Operator: We certainly hope that that will materialize, but it'll take a couple of years to materialize because when clients need to switch vendors, it takes time to let the contract end and convey them to us. Your next question was on the acquisition impact. It's about a point. Yeah, about 100 basis points. Yeah. Got it. Thanks. Again, that's the assumption for 2024 at this stage. Yeah, that's what's baked in there. Yeah. When we come back, we'll give you formal guidance. This is really not guidance. It's really a preliminary look at where we are. Thank you, Justin. Next question will come from the line of Shlomo Rosenbaum with Stifel. Please go ahead. Hi. Thank you very much. I just want to drill down a little bit more into TAS. You talked about the discretionary areas.

We certainly hope that that will materialize, but it'll take a couple of years to materialize because when clients need to switch vendors, it takes time to let the contract end and convey them to us. Your next question was on the acquisition impact.

And we certainly hope that that will materialize, but he he does take a couple of years to materialize because.

When clients need to switch vendors you know it takes time to let the contract and and and convey them to us.

Speaker 4: you know, it takes time to let the contract end and convey them to us.

Ronald Bruehlman: To reflect these changes in revenue, we're also updating our guidance for full-year adjusted EBITDA to $3 billion, $560 million to $3 billion, $570 million, and this represents year-over-year growth at 6.4 to 6.7%. It also implies 70 basis points of margin expansion for the year. Lastly, we're updating our guidance for adjusted deluded EPS to $10.16 to $10.23, which is flat to 0.7% versus the prior year. This includes the year-over-year impact of the step-up of interest rates and the increase in the you take corporate tax rate. If you were to exclude these items, adjustment deluded earnings per share is now expected to grow 11 to 12%.

Speaker 5: Your next question was on the acquisition impact. And it's about a point. Yeah, about 100 basis points, yeah.

Your next question was on the acquisition impact Internet <unk>, Yeah that about 100 basis point yeah.

Justin Bowers: It's about a point.

Ari Bousbib: Yeah, about 100 basis points.

Justin Bowers: Yeah. Got it. Thanks.

Got it thanks.

Again, that's the assumption for 2024 at this stage. Yeah, that's what's baked in there. Yeah. When we come back, we'll give you formal guidance. This is really not guidance. It's really a preliminary look at where we are. Thank you, Justin.

Speaker 4: Again, that's the assumption for 2024 at this stage. Yeah, that's what's baked in. Yeah. When we when we come back, we'll give you four more guidance. This is really not guidance. It's really a preliminary look at where we are.

Okay. That's the assumption for 24 at this stage yeah, that's what <unk>, yeah, what what when we when we come back we'll give you got four more guy. This this is really not guidance is really yeah. It's preliminary <unk>, where we are.

Oh no.

Speaker 2: Thank you, Josh. And we'll come from the line of Shlomo Rosenbaum with Steeple. Please go ahead.

Thank you Justin woke up on the line at <unk> time with FIFA. Please go ahead.

Next question will come from the line of Shlomo Rosenbaum with Stifel. Please go ahead.

Shlomo Rosenbaum: Hi. Thank you very much. I just want to drill down a little bit more into TAS. You talked about the discretionary areas. Maybe you can just get a little bit more into is it consulting, BPO, software, data sales, maybe just a little bit more of detail as to how growth is trending within each one of kind of the subsegments. I know you don't break it out exactly revenue-wise, but it is helpful to kind of think about what's going on beneath the surface there.

Speaker 11: Hi, thank you very much. I just want to drill down a little bit more into TAS. You talked about the discretionary areas. Maybe you can just get a little bit more into, you know, is it consulting, BPO, software, data sales, maybe just a little bit more detail as to how growth is trending within each one of kind of the subsegments. I know you don't break it out exactly revenue-wise, but it is helpful to kind of think about what's going on beneath the surface there.

Hi, Thank you very much I, just wanted to drill down a little bit more into Taz you talked about the discretionary areas. Maybe you can just.

Operator: Maybe you can just get a little bit more into is it consulting, BPO, software, data sales, maybe just a little bit more of detail as to how growth is trending within each one of kind of the subsegments. I know you don't break it out exactly revenue-wise, but it is helpful to kind of think about what's going on beneath the surface there. Yes. Thank you, Shlomo, for the question and the opportunity to clarify. Look, the TAS segment has continued to grow in the quarter. I mean, you know, and you can look at large-cap companies that serve the life sciences industry with products and services supporting post-drug introduction in the market. And you can see that they almost uniformly are showing declining growth this year and sharp declines in the quarter for those who have reported. Now, we continue to have growth.

Ronald Bruehlman: Based on this full-year outlook, our implied fourth quarter guidance is as follows. For revenue, we expect between $3 billion, $769 million in $3 billion, $804 million or growth as 0.8 to 1.7% on a reported basis, and 0.7 to 1.6% on a constant currency basis. Adjusted EBITDA is expected to be between $957 million and $967 million, up 4 to 5.1%. Net yields margin expansion of about 80 basis points in the quarter. Adjusted deluded EPS is expected to be between $2.79 and $2.86 growing 0.4 to 2.9% year-over-year.

Get a little bit more into is or is it consulting P. P O software or data sales, maybe just a little bit more detail as to how growth is trending within each one of kind of a sub segments. I know you don't break it out exactly revenue wise, but it is helpful to kind of think about what's going on beneath the surface there.

Ari Bousbib: Yes. Thank you, Shlomo, for the question and the opportunity to clarify. Look, the TAS segment has continued to grow in the quarter. I mean, you know, and you can look at large-cap companies that serve the life sciences industry with products and services supporting post-drug introduction in the market. And you can see that they almost uniformly are showing declining growth this year and sharp declines in the quarter for those who have reported. Now, we continue to have growth.

Speaker 4: Yes, thank you Shlomo for the question and the opportunity to clarify. Look, the task segment has continued to grow in the core. I mean, you know, and you can look at large cap companies that serve the life sciences industry.

Yes. Thank you struggle for the question and what you needed to clarify.

Look.

The task segment has continued to grow in the <unk> I mean, you know and you can look at large cap companies that serve the life Sciences.

Industry.

Speaker 4: with products and services, supporting post-drug introduction in the market.

With products and services you know supporting.

Most drug introduction in the market.

Ronald Bruehlman: Excluding the step-up and interest expense and the increased UK tax rate, we're expecting fourth quarter adjusted deluded EPS to grow 10 to 13%. Now, all of our guidance assumes that foreign currency rates as of October 30th continue for the balance of the year.

Speaker 4: and you can see that they almost uniformly are showing declining growth this year and sharp declines in the quarter for those who have reported. Now we continue to have growth and

And you can see that they are almost uniformly are showing.

Declining growth this year.

Sharp declines in the corner for those who have reported.

We continue to have growth.

Operator: The reason for that is because some of this stuff is longer term and is somewhat mission-critical. I'm speaking about data, the stuff that's technology licenses, subscription, recurring revenue, all of that continues as is, and that's what is enabling us to continue to deliver growth. However, the parts of our business that are more discretionary, and when I say discretionary, I don't mean to say that our clients may decide simply not to go ahead. It happens, but that's a small proportion of what we sell. It means that it can be done later. It means that it can be done in a different way, perhaps in a quote-unquote slimmed-down version, less bells and whistles. So the consulting and analytics part of our business, which, as you know, is about 1/4 of our revenues, is showing sharp declines, sharper than we would have expected.

The reason for that is because some of this stuff is longer term and is somewhat mission-critical. I'm speaking about data, the stuff that's technology licenses, subscription, recurring revenue, all of that continues as is, and that's what is enabling us to continue to deliver growth. However, the parts of our business that are more discretionary, and when I say discretionary, I don't mean to say that our clients may decide simply not to go ahead. It happens, but that's a small proportion of what we sell.

The reason for that.

Cause.

Speaker 4: Some of this stuff is longer term and is.

Ronald Bruehlman: Now, as as our custom, we plan to provide you with the detailed 2024 full-year guidance on our Q4 earnings call in February. However, while it's early and we're still in the midst of our planning process, we thought it would be helpful to share a preliminary view that would help you frame how we see 2024. We see reported revenue growth in the mid-single digits in 2024. This includes a further step down of approximately $300 million in COVID revenue, which is about 200 basis points of headwind or revenue growth.

Some of this stuff is longer term.

And he's you know somewhat to mission critical I'm speaking about data.

Speaker 4: you know, somewhat mission critical. I'm speaking about data. The stuff that's, you know, technology licenses.

This stuff. That's you know technology licenses subscription recurring revenue all of that continues as is and that's with is enabling us to continue to deliver growth. However.

Ronald Bruehlman: So, as well as another 100 basis points of headwind from foreign exchange rates, assuming current foreign currency exchange rates remain in effect for 2024. We see adjusted EBIT dot margins, expanding 50 basis points and this will drive high single digit adjusted deluded EPS growth. Now, I trust this preliminary look at 2024 is helpful to you.

Speaker 4: Subscription, recurring revenue, all of that continues as is, and that's what is enabling us to continue to deliver growth. However...

Speaker 4: the parts of our business that are more discretionary. And when I say discretionary, I don't mean to say that.

Part of our business that are more discretionary and when I say discretionary I don't mean to say that.

Speaker 4: that our clients may decide simply not to go ahead. It happens, but that's a small proportion of what we fell. It means that it can be done later. It means that it can be...

That's that's our clients may decide simply not to go ahead, it happens, but that's <unk>.

A small proportion of all three cell.

It means that it can be done later. It means that it can be done in a different way, perhaps in a quote-unquote slimmed-down version, less bells and whistles. So the consulting and analytics part of our business, which, as you know, is about 1/4 of our revenues, is showing sharp declines, sharper than we would have expected.

It means that it can be done later.

It means that it can be done in a different way.

Speaker 4: perhaps in a quote and quote, slim down version less, you know, there's an whistle.

Have seen a quote and quote.

Slimmed down version <unk> bells and whistles.

Speaker 4: And so the consulting and analytics part of our business, which as you know, is about a quarter of our revenue.

And so the consulting and then the Olympics are part of our business because you can always a bad quarter of our revenues.

Speaker 4: is showing sharp declines, sharper than we would have expected.

He's showing sharp declines sharper than we would have expected.

Ari Bousbib: Again, we will, as is our custom, give you more detailed guidance and specificity for 2024 when we release our four year earnings early next year. So, to summarize, despite client caution and spending levels below our expectations, it has business continued to its growth in the quarter, while the near term growth outlook for taxes below our previous expectations were confident in the longer term fund the metals of the businesses are pipelines indicate there will be a rebound in demand sometime in 2024.

Operator: Some of the projects have simply fallen off, but the pipelines are still there. That's what gives us confidence for a rebound in 2024. We know that these projects have to be done. The clients are just taking a lot more time to make a decision. They are negotiating us a lot longer, and a lot more, and a lot more aggressively. And this is what has happened. This is, I mentioned in my introductory remarks a few examples of significant wins in TAS, and these are almost uniformly these types of projects: helping clients launch products in new markets, helping them with their go-to-market strategies. These are things that have to be done. And the projects that we won in the quarter, frankly, some of those we should have won in the first quarter. They were in the pipeline since last year.

Some of the projects have simply fallen off, but the pipelines are still there. That's what gives us confidence for a rebound in 2024. We know that these projects have to be done. The clients are just taking a lot more time to make a decision. They are negotiating us a lot longer, and a lot more, and a lot more aggressively. And this is what has happened.

Speaker 4: Some of the projects have simply fallen off, but the pipelines are still there. That's what gives us confidence for a rebound in 24. We know that these projects have to be done. The clients are just taking a lot more time to...

Some of the projects have simply fallen off but the pipelines are still there that's what gives us confidence for a rebound in 24, we know that.

That these projects has to be done the clients are just taking a lot more time.

To make a decision.

Speaker 4: they are negotiating us a lot longer and a lot more and a lot more aggressively.

They are negotiating us all a lot longer and there are a lot more and more aggressively.

D C. So what has happened.

This is, I mentioned in my introductory remarks a few examples of significant wins in TAS, and these are almost uniformly these types of projects: helping clients launch products in new markets, helping them with their go-to-market strategies. These are things that have to be done. And the projects that we won in the quarter, frankly, some of those we should have won in the Q1. They were in the pipeline since last year.

Speaker 4: This is, I mentioned you might introduce, I marked a few examples of significant wins it does. And these are almost uniformly these types of projects.

This is you know I I mentioned you my introductory remarks, a few examples of significant wins.

Ari Bousbib: In the quarter, we delivered another strong performance in RADS with 11% revenue growth at constant currency, excluding COVID-rogated work, quarterly net new bookings were strong at over $2.6 billion, representing a book to bill of $124. And we reached a historic high of $2.3 billion in services bookings, representing a services book to bill of $1.4L. Our industry reading backlog reached a new record of $28.8 billion, approximately 12% year over year. And finally, leading the indicators on the clinical side remains strong as evidenced by a quarterly RFP growth of 10% versus the prior year with growth across all customer segments.

And these are almost uniformly these types of projects.

Speaker 4: helping clients launch a launch products in new markets.

<unk>, helping clients launch a loft products in new markets.

Speaker 4: helping them with their go-market, go-to-market strategies. These are things that have to be done. And the projects that we wanted to quarter, frankly, some of those we should have wanted to first quarter. They were in the pipelines since last year.

Helping them, we got <unk> go to work at strategies. These are things that I have to be done and the project that we wanting a quarter.

Frankly, some of those we should have wanted the first score they wanted the pipelines since last year.

Operator: So the decision timelines have extended, and the terms have been tougher. That's what has happened. I hope that color helps you. Thank you. Thank you. Your next question comes from the line of Luke Sergott with Barclays. Please go ahead. Awesome. Thanks. So you talked about the large FSP win, and you're seeing a lot more shift to that type of hybrid model. And you've talked in the past about this being really cyclical in nature, but this has also come at a lower margin. So help us think about the duration, the size of the FSP wins that you had, and if we should expect some margin headwinds to your future over the next three to six months to a year on this business regarding R&DS side. Thank you, Luke. Yes, you are absolutely correct that an FSP award comes at a lower booked margin than a full-service program.

Operator: So the decision timelines have extended, and the terms have been tougher. That's what has happened. I hope that color helps you.

Speaker 4: So the decision timelines have extended and the terms have been tougher. That's what has happened. I hope that corresponds.

So the decision timelines have extensive.

And in terms of.

Have been tougher.

What has happened I hope that helps.

Shlomo Rosenbaum: Thank you.

Ari Bousbib: Thank you.

Thank you.

Operator: Your next question comes from the line of Luke Sergott with Barclays. Please go ahead.

Thank you.

Speaker 2: Your next question comes from the line of Luke Sergott with Barclays. Please go ahead.

Your next question comes from the line of <unk>. Please go ahead.

Luke Sergott: Awesome. Thanks. So you talked about the large FSP win, and you're seeing a lot more shift to that type of hybrid model. And you've talked in the past about this being really cyclical in nature, but this has also come at a lower margin. So help us think about the duration, the size of the FSP wins that you had, and if we should expect some margin headwinds to your future over the next three to six months to a year on this business regarding R&DS side.

Awesome. Thanks.

Speaker 12: So you talked about the large FSP wind, and you're seeing a lot more shift to that type of hybrid model, and you've talked in the past about this being really in cyclical nature. But this has also come at a lower margin, so help us think about the duration, the size of the FSP winds that you had.

Operator: So, with that, let me hand it back over to the operator to open up the conference for Q&A. At this time, I would like to remind everyone in order to ask a question, press star then a number one on your telephone keypad. You request that you please limit yourself to just one question so that others in the queue may participate as well. We'll pause for a moment to compile the Q&A roster.

So you're talking about the large F. S. P. When and you know you're seeing a lot more shift to the to that type of hybrid motto and and you know you've talked in the past about this being really in cyclical nature, but this is also come at a lower margin. So help us think about like the duration the size of the F.

S P with it you had and.

Speaker 12: If we should expect the, you know, some mixed headwinds to your future, you know, over the next three months to a year on this business from, regarding RDS side.

If we should expect the Z O some mix headwinds to your.

Elizabeth Anderson: Your first question comes from the line of Elizabeth Anderson with Evercore ISI. Please go ahead. Hi, guys. Thanks so much for the question. One thing that I was just trying to work through for my own sort of benefit is sort of the commentary. I think Ari, you alluded to in terms of some of the pullback and R&D spend on the pharma side. And the sort of continued strength of R&D as in terms of bookings and what you're seeing in terms of RFPs.

Your future over the next three months to a year on on this business from regarding already I sighed.

Elizabeth Anderson: Could you help us sort of think about how you think about those two factors sort of that commentary, where you sort of think pharma's growth is going to be first sort of the remainder of this year, next year, and that and maybe remind us of how that's played out in prior cycles. Thank you. Yeah, you're asking Elizabeth, thanks for your question. You're asking about contrasting the pullback is spend on the commercial side versus.

Ari Bousbib: Thank you, Luke. Yes, you are absolutely correct that an FSP award comes at a lower booked margin than a full-service program.

Speaker 4: Thank you, Luke. Yes, you are absolutely correct that an FSP award comes at a lower booked margin than a full service program.

Thank you Luke Yes, you are absolutely correct that F. S. P Award comes at a lure booked <unk> than a.

Elizabeth Anderson: No, no, no, no. Sorry, R and D.S., more specifically, sorry. Yeah, but there is no pullback on span in R and D.S., I don't think I said that. I said the opposite. Funding in R and D.S, has been very strong. I'm sorry if I spoke or was misunderstood, but there is no pullback in R and D.S., quite the opposite. I mentioned in my introductory comments that the, if you look at the EBP sector, which has been under pressure and people have been concerned about, we see EBP funding in the fall, actually fire, then it was last year.

Full service programs.

Operator: You're also correct that this is a cyclical development in the industry. I recall very well that at the time we did the merger seven years ago, and coming into, at the time, the legacy Quintiles organization, it was explained to me that the industry was now in the midst of a switch from full-service to FSP, and as a result of which, Quintiles at the time had pulled back from servicing these clients because they didn't want to do FSP work given its lower margin profile. I thought at the time that was a strategic error. We, since then, of course, have decided to serve our clients with the full portfolio of services, including FSP, including full-service, and including hybrid and everything else. We serve clients, we don't push offerings.

Speaker 4: And you're also correct that this is a cyclical development in the industry. I recall very well that at the time we did the merger, seven years ago, and coming into at the time the legacy Quintas organization, it was explained to me that the industry was now in the midst of a switch from full service to FSP, and as a result of which

You're also correct that this is a cyclical development in the industry. I recall very well that at the time we did the merger seven years ago, and coming into, at the time, the legacy Quintiles organization, it was explained to me that the industry was now in the midst of a switch from full-service to FSP, and as a result of which, Quintiles at the time had pulled back from servicing these clients because they didn't want to do FSP work given its lower margin profile.

And you also correct that this has is it is a secret code developing in the industry I recall very well that at the time, we did the merger seven years ago.

And you know coming into at the time that the legacy Queen does organization. It was explained to me that the industry was now in the midst of a Ah switch from food service to F. S. B N as a result of which Queen dogs at the time had pulled back.

Speaker 4: Quintas at the time had pulled back from servicing these clients because they didn't want to do FSP work given its lower margin profile.

Servicing these clients because they don't want to do a S. P.

Work given it slower module profile.

I thought at the time that was a strategic error. We, since then, of course, have decided to serve our clients with the full portfolio of services, including FSP, including full-service, and including hybrid and everything else. We serve clients, we don't push offerings.

Speaker 4: I thought at the time there was a strategic error and we since then of course have decided to serve our clients with the food

Thought at the time that was a strategic error and we since then of course have decided to serve our clients with the four.

Speaker 4: both for you of services, including FSP and including full service and including hybrid and everything else. We

Both for you of services <unk>.

Clothing, FSP, and including full service, including a high breathe and everything else.

We sort of clients.

Speaker 4: We don't push offerings. So if at this point in time, our clients are interested in more FSP or more hybrid models, that's where we will sell to them. It is then incumbent upon us.

We don't push offerings. So he felt disappointed dying all clients are interested in more F. S. B a war hybrid models, that's where we will sell to them is ven incumbent upon us to.

Operator: So if at this point in time, our clients are interested in more FSP or more hybrid models, that's what we will sell to them. It is then incumbent upon us to work on our cost structure to try to recover margins when we execute the work at a higher level than what we booked it at and try to continue to develop cost containment and cost reductions so that we can offset the margin mix impact. Look, we are a very large company. We are executing thousands of trials at any given point in time. We manage a portfolio of businesses. Once again, we are about a $15 billion revenue company growing mid-single digits before you account for the step down in COVID revenue and the FX headwind. And we are at Adjusted EBITDA margins of 24%, and we are expanding those margins.

So if at this point in time, our clients are interested in more FSP or more hybrid models, that's what we will sell to them. It is then incumbent upon us to work on our cost structure to try to recover margins when we execute the work at a higher level than what we booked it at and try to continue to develop cost containment and cost reductions so that we can offset the margin mix impact. Look, we are a very large company. We are executing thousands of trials at any given point in time.

Speaker 4: to work on our cost structure to try to recover margins when we execute the work at a higher level than what we booked it at and try to continue to develop cost containment and cost reductions so that

Work on our cost structure to try to recover margins when we execute door at a higher level than when we booked it out.

Elizabeth Anderson: And I think your today, I mentioned that funding was up 8% year over year. So I also mentioned that we are experiencing a strong, continued RFP flow growth. It's actually up 10% in the quarter year over year. So I think it's quite the opposite. Our world continue at the record high level, again, higher than last year. I could give you some more color. A qualified pipeline is up 16% year over year and, and, you know, continues to be very, very strong.

And try to continue to develop cost containment and cost reductions.

So that we can offset the margin mix impact look we have a very large company.

Speaker 4: the margin mix impact. Look, we are a very large company.

Speaker 4: we are executing thousands of trials at any given point in time. We manage a portfolio of businesses. Once again, we are about a $15 billion revenue company growing mid-single digits before you account for the step down in COVID revenue and the FX headwind. And we are at a $15 billion revenue company growing mid-single digits before you account for the step down in COVID revenue and the FX headwind. And we are at a $15 billion revenue company growing mid-single digits before you account for the step down in COVID revenue and the FX headwind.

We are exit you're seeing thousands of trials at any given point in time, we manage a portfolio of businesses. Once again, we are about 15 billion dollar revenue company growing mid single digits. You know before you account for the step down in in in in <unk>.

We manage a portfolio of businesses. Once again, we are about a $15 billion revenue company growing mid-single digits before you account for the step down in COVID revenue and the FX headwind. And we are at Adjusted EBITDA margins of 24%, and we are expanding those margins.

Yeah fix headwind.

And we are at.

Elizabeth Anderson: A total pipeline as well, very strong record high historically. I mentioned our book to bill in the quarter is 124 and 606 basis, including past, and when you exclude past, and you just focus on services, our book to bill is 1.4. Our services bookings were 2.3 billion dollars in the quarter. That's a historic high for us. So again, nothing that we see and we've been hammering this point over and over again in the environment, or in an own internal metric leads us to believe there is anything changed on the RNDS span.

I, just it'd be the margins of 24%.

And we are expanding those March.

Speaker 4: And we intend to continue that model well into the future, despite cyclical headwinds that may occur, whether it is a tougher spending environment on the TAS side, whether it is a switch to FSP from some of our large pharma clients. You saw in the quarter, again, $2.3 billion

Operator: We intend to continue that model well into the future despite cyclical headwinds that may occur, whether it is a tougher spending environment on the TAS side, or whether it is a switch to FSP from some of our large pharma clients. You saw in the quarter, again, $2.3 billion of services fee revenue, excluding pass-through bookings, resulting in a book-to-bill of 1.4, again, a historic high in our bookings that included some FSP wins. Again, not anything that would move the needle dramatically, but on a large number like this, you can see that we have less pass-throughs that will materialize in our margin mix in the next couple of years, not next quarter, obviously. We fully intend to offset that with our cost reductions and continue to increase our margins. Thank you for your question. Yeah, thank you.

We intend to continue that model well into the future despite cyclical headwinds that may occur, whether it is a tougher spending environment on the TAS side, or whether it is a switch to FSP from some of our large pharma clients. You saw in the quarter, again, $2.3 billion of services fee revenue, excluding pass-through bookings, resulting in a book-to-bill of 1.4x, again, a historic high in our bookings that included some FSP wins.

And we intend to continue that's marble well into the future. Despite cyclical headwinds that may occur whether it is a.

A tougher spending environment on the <unk> side, whether it is switch to FSP from some of our large while my clients you saw in the quarter again $2.3 billion.

Services.

Speaker 4: She revenue excluding pass through bookings resulting in a

She revenue excluding pass through bookings, resulting you know.

Speaker 4: Book to be the 1.4. Again, a historic high in a book is that included.

Book to be the 1.4 again historic high in our bookings that included.

Speaker 4: some FSP wins, again, not anything that would move the needle dramatically, but on a large number like this, you can see that we have less pastures that will materialize in our margin mix, you know, in the next couple of years, not next quarter, obviously. And we fully intend to offset that with our cost reductions and continue to increase our margins. Thank you for your question.

Some F S. <unk> again, not anything that would move the needle dramatically.

Again, not anything that would move the needle dramatically, but on a large number like this, you can see that we have less pass-throughs that will materialize in our margin mix in the next couple of years, not next quarter, obviously. We fully intend to offset that with our cost reductions and continue to increase our margins. Thank you for your question.

Elizabeth Anderson: There are different dynamics. It is true that we have, we see, our clients, large farmers, especially, explore new models with more FSP or hybrid type of services awarded. I mentioned we want some large FSP, which explains, of course, the lower amount of past rules in the in the quarter in our bookings. But other than that, the Spanish strong and our prospects for the business continue to be very strong on the RNDS side.

But on the large number like this.

You can see that we have less pass throughs that will materialize you know margin mix you know in the next couple of years not next quarter, obviously, and we fully intend to offset that with our cost reductions and continued to increase <unk>. Thank you for your question.

Luke Sergott: Yeah, thank you.

Yeah. Thank you.

Speaker 2: Your next question will come from the line of Dilindra Singh with Truist Securities. Please go ahead.

Operator: Your next question will come from the line of Jailendra Singh with Truist Securities. Please go ahead. Yeah, thank you. Thanks for taking my questions. I want to ask about the capital deployment strategy over the next 12 months. Has there been any change there in terms of your priority to pay down debt versus buyback shares, or even M&A allocation? And one quick clarification, what is the magnitude of the swaps rolling off next year? The first question and the second question I'll give to the technicians here. The first question on capital allocation, look, it's fascinating that we are getting from our investors two different messages. One is, "Please, please reduce your leverage." And one is, "Please, please do not change your leverage." And I have to tell you, we historically have been living with a level of leverage that's admittedly higher than others.

Operator: Your next question will come from the line of Jailendra Singh with Truist Securities. Please go ahead. Yeah, thank you.

Your next question will come from the line I forget linger thing with Chili security. Please go ahead.

Speaker 13: Thank you. Thanks for taking my questions. I want to ask about the capital deployment strategy over the next 12 months. Has there been any change there in terms of your priority to pay down debt versus buyback shares or even M&A allocation? And one quick clarification, what is the magnitude of the swaps rolling off?

Jailendra Singh: Thanks for taking my questions. I want to ask about the capital deployment strategy over the next 12 months. Has there been any change there in terms of your priority to pay down debt versus buyback shares, or even M&A allocation? And one quick clarification, what is the magnitude of the swaps rolling off next year?

Yeah. Thank you. Thanks for taking my questions for the capital deployment strategy or the next 12 months has there been any change there in terms of your Friday to pay down debt buybacks chairs or even M&A location and one quick clarification. What is the magnitude of the swaps rolling off next year.

Elizabeth Anderson: Thanks, Ari. That's super helpful. And so when we take some sort of pharma RND commentary that you said about some of the pullbacks that in some of the spending cuts in there, you would say that you guys are seeing still seeing strong demand within that specific pharma segment. Yeah, further, and they're cutting costs by pushing more into FSP and maybe there's some anecdotal large pharma companies that are cutting, but the sort of broader strengths across that.

Ari Bousbib: The first question and the second question I'll give to the technicians here. The first question on capital allocation, look, it's fascinating that we are getting from our investors two different messages. One is, "Please, please reduce your leverage." And one is, "Please, please do not change your leverage." And I have to tell you, we historically have been living with a level of leverage that's admittedly higher than others.

Speaker 4: The first question and the second question I'll give to the technicians here, the first question on capital location.

I think the first question. The second question I'll I'll I'll give you the the technicians here. The the first question on capital or a location.

Speaker 4: Look, it's fascinating that we are getting from our investors to different messages. One is...

Look it's fascinating we are getting from our investors to different messages one is.

Elizabeth Anderson: That's the correct way to interpret what you're saying on the bridge. Yes, yes. I mean, not from you saw, I think two thirds of the top 10 large pharma, and we know that that's basically the case, the vast majority of large pharma companies have announced either publicly or internally. A significant cost cutting programs that's due to the macro environment, which is very challenging concerns raised by the IRA and, you know, the general issues that we see geopolitical problems all over the world, continuing wars in Europe, the Middle East.

Speaker 4: Please, please reduce your leverage. And one is, please, please do not change your leverage. And I have to tell you, we historically have been living with a level of leverage that's admittedly higher than others. We are at around 3 and 1.5.

Please please reduce your leverage.

<unk>. Please please do not change your life and.

I have to tell you, we <unk> have been living with a level of levers that at.

Admittedly higher.

Others.

Operator: We are at around 3.5x net leverage right now. I want to just, for the anecdote, tell you that we've had in the past much higher levels of leverage under much more difficult market conditions and much lower levels of cash flow conversion. We've lived with that nicely because we have a highly predictable, high-visibility business model. Our strategy has been A, to invest in the business, in capital expenditures, to innovate new products and services, B, buy companies that add, that are creative and enable us to grow faster, and C, return money to our shareholders through share repurchases. That has been a very effective strategy, especially when rates were extremely low. I remind you that just two years ago, treasuries were at 0%. I'm very glad that we had that amount of leverage. Today, treasuries at, what, 5.5%?

We are at around 3.5x net leverage right now. I want to just, for the anecdote, tell you that we've had in the past much higher levels of leverage under much more difficult market conditions and much lower levels of cash flow conversion. We've lived with that nicely because we have a highly predictable, high-visibility business model.

We are at around three and a half <unk>.

<unk> right now.

Speaker 4: I want to just, for the anecdote, tell you that we've had, in the past, much higher levels of leverage.

Oh I want to just.

For the anecdote tells me that we've had.

In the past.

Much higher levels of leverage and.

Elizabeth Anderson: And of course, we have the situation in China, which has all but frozen the market for multinational corporations in China. So all of those are headwinds plus the companies that were very active during the COVID years are seeing, you know, dramatic pullbacks in rather than when all of that is putting pressure on margins and as a result. Last pharma has been, and I would say unusually so, very aggressive in launching cost reduction programs.

And a much more difficult.

Speaker 4: market emissions and much lower levels of cash flow conversion.

Market conditions, and much lower levels of Castro conversion and.

Speaker 4: And we've lived with that nicely because we have a highly predictable, high visibility business model.

And we've lived with that nicely because we have a highly predictable high visibility business model.

Our strategy has been A, to invest in the business, in capital expenditures, to innovate new products and services, B, buy companies that add, that are creative and enable us to grow faster, and C, return money to our shareholders through share repurchases. That has been a very effective strategy, especially when rates were extremely low. I remind you that just two years ago, treasuries were at 0%. I'm very glad that we had that amount of leverage. Today, treasuries at, what, 5.5%?

Speaker 4: Our strategy has been A, to invest in the business, in capital expenditures, to innovate new products and services. B.

I'll strategy has been a to invest in the business and capital expenditures to innovate new products and services B.

Elizabeth Anderson: Now, I said before that that is not reflected so far. We haven't seen that in the R&D side of the house. Again, I want to reiterate very strong strength, I mean, a good moment in the business and all the metrics show that there is no slow down there. Again, not surprising. It's a long cycle business. However, we bearing the brunt of those cost reduction initiatives on the task segments where we see that projects that should take certain amount of time are taking a lot more time to get decided.

Speaker 4: Buy companies that add that are creative and I enable us to grow faster and see return money to our shareholders through share repurchase.

By companies that are <unk> that are creative and I enable us to grow faster and see return money to our shareholders through share repurchases.

Speaker 4: And that has been a very effective strategy, especially when rates were extremely low. I remind you that just two years ago, treasuries were...

And that has been a very effective strategy, especially when rates were extremely lower remind you that just two years ago.

Treasuries were at zero.

Speaker 4: zero. And I'm very glad that we had that amount of leverage.

Zero.

And I'm very glad that we had that amount of leverage.

Today.

Speaker 4: Treasuries at what, five and a half? I mean, we've never seen in history such a sharp, dramatic rise in interest rates in such a short period of time. Obviously.

Treasuries at what five and a half.

Operator: I mean, we've never seen in history such a sharp, dramatic rise in interest rates in such a short period of time. Obviously, we are paying the brunt of our leverage, the price of that leverage because of that, and it's costing us 10 points, 10 points of growth in earnings per share. However, I would argue that mid-single digits treasury rates is high versus zero, but it's not the end of the world. I would also tell you that we bore the brunt of that sharp increase in interest rates this year in 2023. And assuming, like everyone else assumes, that the curve, if it is to be believed, indicates a stabilization and even a potential decline, then that should be a headwind, I'm sorry, a tailwind to our EPS going forward, and we don't anticipate a sharp increase in rates or in interest expense going forward.

Operator: I mean, we've never seen in history such a sharp, dramatic rise in interest rates in such a short period of time. Obviously, we are paying the brunt of our leverage, the price of that leverage because of that, and it's costing us 10 points, 10 points of growth in earnings per share. However, I would argue that mid-single digits treasury rates is high versus zero, but it's not the end of the world. I would also tell you that we bore the brunt of that sharp increase in interest rates this year in 2023.

We've never seen.

In history, such as sharp dramatic rise in interest rates in such a short period of time.

<unk>.

Elizabeth Anderson: All rewarded. And we see our clients negotiating on terms a lot harder than they ever were. And all of that has caused us to come short on the task segment in our revenues. But again, we're confident that this is going to rebound. We know this because the pipelines continue to be very strong on the task segments. And we, if you look back at every time there was a pullback of source from large pharma in history, whether you go back to the 2008-10 period or any time some big legislation was enacted, there was always a little bit of a pullback. And then it came back the company industry is very innovative and comes back roaring and our business goes along with it. So we're confident it will come back sometime in 24. Thank you a little bit.

Speaker 4: We are paying the brunt of our leverage, the price of that leverage because of that, and it's costing us 10 points.

We are paying the brunt of our leverage the price of that leverage.

Because of that and it is costing us 10 points.

10 points.

Speaker 4: of growth in earnings per share. However, I would argue.

Growth in earnings per share, however, I would argue.

Speaker 4: that meet single-digit treasury rates.

That mid single digits <unk>.

Treasury rates.

Speaker 4: you know, it's high versus zero, but it's not the end of the world. I will also tell you that we bought a branch of that sharp increase in interest rates this year in 23.

It's high versus zero, but it's not the end of the world.

Also tell you that we both the brunt of that sharp increase in interest rates this year and twenty-three.

And assuming, like everyone else assumes, that the curve, if it is to be believed, indicates a stabilization and even a potential decline, then that should be a headwind, I'm sorry, a tailwind to our EPS going forward, and we don't anticipate a sharp increase in rates or in interest expense going forward.

Speaker 4: and, you know, assuming like everyone else assumes.

And you know assuming like everyone else.

<unk> <unk>.

Speaker 4: that the curve, if it is to be believed, indicates a stabilization and even a potential decline.

<unk> if it needs to be relieved you know easy case, suburbanization, and even a potential decline.

Speaker 4: then that should be a headwind. I'm sorry, a tailwind.

That should be a headwind.

Sorry, a tailwind two R. E. P is going forward and we don't anticipate is sharp increase in rates Orange interest expense going forward and so therefore, we should be able to resume strong E. P. S growth going forward. That's further leverage having said that we are.

Speaker 4: to our EPS going forward, and we don't anticipate a sharp increase in rates or in interest expense going forward. And so, therefore, we should be able to resume strong EPS growth going forward. That's for the leverage. Having said that, we are working.

Charles Rhyee: Your next question comes from the line of Charles Rhyee with 2D Callins. Please go ahead. Yeah, thanks for taking the question. Just wanted to follow up on the task segment here. You know, you talked about sort of longer timelines, but when you're in discussions with clients, do they continue to express an intention to kind of continue with the projects? Or is our thing sort of just on hold? And how much of this is you mentioned the IRA?

Operator: So therefore, we should be able to resume strong EPS growth going forward. That's for the leverage. Having said that, we are working as we speak on obviously refinancing and readdressing some of the shorter-term maturities, which we have in 2024 and in 2025, and we'll do that soon, hopefully. That will continue to alleviate that headwind that we face this year in interest expense and continue to stabilize our balance sheet. But for now, at least, we intend to continue to use our cash to invest in the business and do acquisitions and share repurchase, especially at the levels where we are. Thank you for your question. Any comment on the swap? Yeah, we have about $800 million of swaps rolling off in the second quarter of 2024. Do you want to add anything to that next?

So therefore, we should be able to resume strong EPS growth going forward. That's for the leverage. Having said that, we are working as we speak on obviously refinancing and readdressing some of the shorter-term maturities, which we have in 2024 and in 2025, and we'll do that soon, hopefully. That will continue to alleviate that headwind that we face this year in interest expense and continue to stabilize our balance sheet.

Working.

As we speak.

Speaker 4: on obviously refinancing and readdressing some of the shorter term maturities, which we have in 24, in 25. And we'll do that, you know, soon, hopefully. And that will continue to alleviate.

Obviously refinancing and re addressing some of the shorter term maturities, which we have in 24 and 25 and we'll do that.

Charles Rhyee: [inaudible] But if it's amazing how pipeline, then it means the client still intends to do it. It's just that the pipeline for decision-making has been pushed to the right. What explains it? It's again, general concerns about the economy, general concerns about the macro geopolitical issues, the pressures resulting from sharp revenue declines, post-COVID. And what that entails from emerging point of view, as I mentioned in my introductory remarks, we are very large vendor to pharma and to large pharma in particular.

Soon hopefully and that will continue to alleviate.

Speaker 4: that headwind that we faced this year in interest expense and continue to stabilize our balance sheet. But for now, at least, we intend to continue to use our cash to invest in the business and do acquisition and share repurchase, especially at the levels where we are.

That headwind that we are facing this year and interest expense and continue to stabilize our balance sheet, but for now at least.

But for now, at least, we intend to continue to use our cash to invest in the business and do acquisitions and share repurchase, especially at the levels where we are. Thank you for your question. Any comment on the swap?

Tend to continue to use our cash too.

Invest in the business and do acquisition and share repurchase, especially at the levels, where we are.

Speaker 3: Thank you for your question. Any comments on the swap? Yeah, we have about $800 million. So it's swaps rolling off in the second quarter of 2024. You don't add anything to that next year. What's that about an average rate of about, call it somewhere between two and 3%. So we'll be ahead with next year, but not to the extent that you saw on the swap that rolled off this year.

Thank you for your question any comment on the swap yeah, we have about $800 million of swaps rolling off in the second quarter of 2024.

Jailendra Singh: Yeah, we have about $800 million of swaps rolling off in the Q2 of 2024. Do you want to add anything to that next?

Anything to that next what should that in about an average rate of about call. It somewhere between 222 and a 3%. So you know it will be a headwind next year, but not to the extent that you saw on the swap that rolled off this year.

Operator: Which is at about an average rate of about, call it somewhere between 2% and 3%. So we'll be a headwind next year, but not to the extent that you saw on the swap that rolled off this year. Got it. Thank you. Yes. Thank you very much. All right. Well, thank you, everyone, for joining us today. We look forward to talking to everyone on our next call, and myself and the team will be available for any follow-up calls and any other follow-up questions you have across the day and over the next few days. So feel free to reach out. Thanks, everyone, for joining. This concludes today's conference call. You may now disconnect. Please wait. The conference will begin shortly.

Ari Bousbib: Which is at about an average rate of about, call it somewhere between 2% and 3%. So we'll be a headwind next year, but not to the extent that you saw on the swap that rolled off this year.

Jailendra Singh: Got it. Thank you.

Got it thank you.

Ari Bousbib: Yes. Thank you very much.

Yes, thank you very much.

Nick Childs: All right. Well, thank you, everyone, for joining us today. We look forward to talking to everyone on our next call, and myself and the team will be available for any follow-up calls and any other follow-up questions you have across the day and over the next few days. So feel free to reach out. Thanks, everyone, for joining.

Speaker 3: I will thank you everyone for joining us today. We look forward to talking to everyone on our next call and myself and the team will be available for any follow up calls and any other follow up questions you have across the day and over the next few days. So feel free to reach out. Thanks. Everyone for joining. This concludes today's.

Alright, well. Thank you everyone for joining us today, we look forward to talking to everyone on our next call and myself and the team will be available for any follow up calls and any other follow up questions you have across the day and over the next few days so feel free to reach out thanks, everyone for joining.

Operator: This concludes today's conference call. You may now disconnect. Please wait. The conference will begin shortly.

This concludes today's conference call you may now disconnect.

Please rate the conference will begin shortly.

Speaker 1: Please wait. The conference will begin shortly. Please stand by. Please stand by. Please stand by. Please stand by.

[music].

Yeah.

[noise] [music].

Charles Rhyee: And you know, when large pharma seeks to improve their margins, they seek to reduce costs. And obviously they come to us for further reductions and that elongates timelines. And of course, a world pricing as well on our side. All of that has resulted in us coming short on our revenues in does along with, as we mentioned in introductory remarks, the significant effects headwinds versus what we had guided to before. So that's the environment. Yeah, thank you very much for your review. Both for you only on the on the R&D side. No, no, on the commercialization.

Ari Bousbib: Sorry, I misspoke. I meant, you know, how much has the R&D impact is sort of as they have that had an effect on when pharma was a portfolio of views and where they put their discretionary spend, but it sounds like you're saying it's more just the general macro environment that has an impact on. Yeah, we actually already hasn't had any concrete significant concrete impact yet on the market. This is all, you know, based on hypothetical developments and down the line. So that just adds another cloud of uncertainty and anticipation of that uncertainty that causes management teams to appropriately seek, you know, cost containment. That's all.

Ari Bousbib: Okay. Appreciate it. Thank you.

Daniel Leonard: Your next question comes from the line of Dan Leonard with UBS. Please go ahead. Thank you. I just wanted to circle back to your 2024 framing commentary that mid single digit growth figure. Can you speak to your expectations between the task segment in the R&D segment. And then in R&DS in 2024, do you expect any meaningful difference in growth rates between the direct fee revenue and total revenue. Thank you.

Ari Bousbib: So again, this is a very, we thought it would be helpful just because there's uncertainty and you will recall that even in the, you know, at the peak of COVID, we decided to give you guidance early. And we're doing this because we hope that that's helpful to you. Now, it's an initial outlook based on where we are in our planning process. We have not completed that planning process.

Ari Bousbib: So I would caution you that this is again preliminary and we will come back as is our custom when we release for your earnings early in 24 with details and precise guidance by segments, etc. Just on your question, we are guiding to mid single digit overall revenue growth. That includes 300 million dollars of step down from COVID. And I think that's essentially all in R&DS. Yes, so if you added that back to our total revenues, that would be another couple of hundred basis points on top of that.

Ari Bousbib: And of course we have, we expect a hundred basis points of foreign exchange headwinds assuming effects rate remains what they are today. So when we say mid single digits, that's really on a reported basis. Once you adjust for the COVID step down and effects, it's more high single digits, which I'm sure you agree for about 15 billion dollar revenue company is quite an achievement in the current environment.

Ari Bousbib: With respect to segment growth, I think it's too early to give it to you. Obviously, I have an idea, but what should I mean, I just gave it to you, you know, but when we, when we tell you that the COVID impact is a hundred percent in R and the S, you could just assume that we are expecting, it's actually for now, assume about the same across the segments that is, you know, mid single digits, I would say, okay, before the COVID adjustment. Thanks, Ari.

David Windley: And as a reminder, we ask that you please submit your questions to one, your next question will come from the line of David Winley with Jeffries, please go ahead. Hi, good morning. Thanks for taking my question.

Ari Bousbib: Ari, I wanted to focus on on margin. You commented in your prepared remarks about productivity initiatives that you took in the third quarter. You're talking about the bookings mix being heavy to service. And so, you know, that could be beneficial in R and DS to to EBITDA growth. Just wondered if you could talk kind of expansively about any further productivity initiatives that you might be able to take and kind of what are the drivers to get you to that 50 basis point of EBITDA margin expansion for next year.

Ari Bousbib: Thanks. Well, thank you. Look, I mean, the productivity initiatives I mentioned, not just in the third quarter, you will recall, we started this towards the end of last year. That's what has led us to be able to address. You know, the revenue shortfall and not, you know, completely bear the brunt of that reduction falling through EBITDA. We've been able to offset a lot of that headwind with those cost reduction programs. It takes time.

Ari Bousbib: You know, as you know, if we, the actions that we took in Q3 are not going to, you know, bear benefit until Q4, Q1, Q2 of next year. So we, we, we, we constantly taking actions to restructure our overhead structure to review our spans of control globally to, you know, continue our offshoring programs to review our infrastructure footprint that includes real estate. It includes IT. It includes really all of that infrastructure that we need to run our business.

Ari Bousbib: And all of those cost factors, along with the, you know, big of the proper, big of in sourcing outsourcing. And as I mentioned, a continued offshoring of certain activities and taking advantage of labor arbitrage among our different centers, whether it's in the Philippines, in India, in Bangladesh, in South America, et cetera. All of those things are being done on a non-going basis. And we see the benefit in our margins this year.

Ari Bousbib: And, you know, the actions we took, for example, in the third quarter. The carryover benefit will materialize in Q4. So the, and in following quarters during 2024. The reason we feel confident about 50 basis points margin expansion in 2024 is because we see that it's the carryover of the actions we took this year that will benefit on a full-year basis, 2024. And of course, we don't intend to stop those actions selectively. That's great. Thank you. I'll stay the one. Thanks.

Justin Bowers: Your next question will come from the line of Justin Bowers with Joy to Bank. Please go ahead.

Ari Bousbib: Justin, you're on mute. Thank you. And good morning, everyone. So just wanted to take a step back. And with respect to some of the cost-cutting programs that we've seen large pharma announced, what is Iqvia's opportunity to sort of participate in some of that and help drive some of those fabings, you know, whether it's in sort of RDS. RDS or CAS. And then secondarily on for the outlook for 2024. What is what's the M&A assumption embedded in the macro free?

Ari Bousbib: Thank you, Justin, for your question. Yes, we are actively engaged with our customers to help them with their cost reduction programs. Luke, we have to we are a large vendor to large pharma. We are across the board, clinical and task. And they come to us and ask us to help them. So, you know, we have an opportunity to do that. Obviously, it affects our revenue growth. That's primarily the case in task because that's where, you know, the pricing changes and the renegotiated terms impact us, you know, almost immediately.

Ari Bousbib: You know, less so in RDS, but mostly in task. Now, the opportunity, if you were for us, is that in those conversations, we try to offer, you know, more services that has always been the case, that's a traditional way of engaging with our clients when they seek our cost reductions. You know, we try to capture a bigger share of their spend in exchange for being able to deliver those services at a lower price point.

Ari Bousbib: And so the benefit for us is longer term. We get a bigger piece as they give us more volume. We've seen that happen, frankly, on the commercial side and on the RDS side over the past five, six years, and certainly since the merger.

Ari Bousbib: And we certainly hope that that will materialize, but it'll take a couple of years to materialize because when clients need to switch vendors, you know, it takes time to let the contracts end and convey them to us.

Ari Bousbib: Your next question was on the acquisition impact. And it's about a point. Yeah, that 100 base for you. Got it. Thanks. Again, that's the assumption for 24 at this stage. Yeah, that's what's taking you know, when we, when we come back, we'll give you more guidance. This is really not guidance. It's really, yeah, it's preliminary looked at where we are.

Unknown Speaker: Hi, thank you very much.

Shlomo Rosenbaum: I just want to drill down a little bit more into Taz. You talked about the discretionary areas. Maybe you can just get a little bit more into, you know, is it consulting, BPO software, data sales, maybe just a little bit more of detail as to how growth is trending within each one of kind of the sub segments. And you don't break it out exactly revenue wise, but it is helpful to kind of think about what's going on beneath the surface there.

Shlomo Rosenbaum: Yes, thank you Shlomo for the question and to clarify. Look, the task segment has continued to grow in the core. I mean, you know, and you can look at large cap companies that serve the life sciences industry. With products and services, you know, supporting post drug introduction in the market. And you can see that they almost uniformly are showing declining growth this year and sharp declines in the core for those who are reported.

Shlomo Rosenbaum: Now, we continue to have growth. And the reason for that is because some of this stuff is longer term and is, you know, somewhat mission critical. I'm speaking about data. The stuff that's, you know, technology licenses, on subscription, recurring revenue, all of that continues as is and that's what is enabling us to continue to deliver growth. However, the part of our business that are more discretionary. And when I said discretionary, I don't mean to say that that our clients may decide simply not to go ahead.

Shlomo Rosenbaum: It happens. But that's a small proportion of what we fell. It means that it can be done later. It means that it can be done in a different way. Perhaps in a quote and quote. A slim down version less, you know, bears and whistles.

Ari Bousbib: And so being consulting and analytics, a part of our business, which as you know, is a bad quarter of our revenues is showing sharp declines sharper than we would have expected. Some of the projects have simply fallen off. But the pipelines are still there. That's what gives us confidence for rebound in 24. We know that these projects has to be done. The clients are just taking a lot more time to make a decision.

Ari Bousbib: They are negotiating us a lot longer and a lot more and a lot more aggressively. And this is what has happened. This is, you know, I mentioned in my introductory remarks a few examples of significant wins it does. And these are almost uniformly these types of projects. , Helping Clans, Launch, Launch Products in New Markets, Helping Them With Their Go Markets, Go To Markets Strategies, these are things that I have to be done.

Ari Bousbib: And the projects that we wanted to quarter, frankly some of those we should have wanted the first quarter. They were in the pipelines since last year. So the decision timelines have extended and the terms have been suffered. That's what has happened. I hope that color helps you. Thank you.

Luke Sergott: Your next question comes from the line of Luke Sergott with Barclays. Please go ahead. Well, some thanks. So you talked about the large FSP win. You know, you're seeing a lot more shift to the type of hybrid model. And you know, you've talked in the past about this being really in cyclical nature. But this has also come at a lower margin. So help us think about like the duration, the size of the FSP win that you had.

Luke Sergott: And if we should expect some of mixed headwinds to your future over the next three to month to a year on this business from regarding RDS side. Thank you. Look, yes, you're absolutely correct that an FSP award comes at a lower booked margin than a full service program. And you're also correct that this is a cyclical development in the industry. I recall very well that at the time we did the merger five years ago, and you know, coming into at the time the legacy Quintas organization, it was explained to me that the industry was now in the midst of a switch from full service to FSP.

Luke Sergott: And as a result of which Quintas at the time had pulled back from servicing this clients because they didn't want to do FSP work given its lower margin profile. I thought at the time there was a strategic error and we since then, of course, have decided to serve our clients with the full portfolio of services, including FSP and including full service and including hybrid and everything else. We serve clients. We don't push offerings.

Luke Sergott: So if at this point in time our clients are interested in more FSP or more hybrid models, that's what we will spell to them. It is then incumbent upon us to work on our cost structure to try to recover margins when we execute the work at a higher level than what we booked it out and try to continue to develop cost containment and cost reductions so that we can offset the margin mix impact.

Luke Sergott: Look, we are a very large company. We are executing thousands of trials at any given point in time. We manage a portfolio of businesses. Once again, we are about a 15 billion dollar revenue company growing mid single digits. You know, before you account for the step down in COVID revenue and the effects headwind. And we are at adjusted to be the margins of 24%, and we are expanding those marches. And we intend to continue that model well into the future despite cyclical headwinds that may occur, whether it is a tougher spending environment on the taskfile, whether it is a switch to FSP from some of our large farm clients, you saw in the revenue, excluding pass-through bookings, resulting in a book to be at 1.4.

Luke Sergott: Again, a historic high in our bookings, that included some FSP wins, again, not anything that would move the needle dramatically, but on a large number like this, you can see that we have less pass-throughs, that will materialize in our margin mix, you know, in the next couple of years, not next quarter, obviously, and we fully intend to offset that with our cost reductions and continue to increase our margins. Thank you for your question.

Ari Bousbib: Yeah, thank you.

Delinder Singh: Your next question will come from the line of delinder seeing what's true as securities. Please go ahead. Yeah, thank you.

Ari Bousbib: Thanks for taking my questions. I want to ask about the capital deployment strategy over the next 12 months. Has there been any change there in terms of your priority to pay down debt versus buyback shares or even MNA allocation? And one quick clarification, what is the magnitude of the swaps rolling off next year? The first question and the second question I'll give to the technicians here, the first question on capital allocation.

Ari Bousbib: Look, it's fascinating that we are getting from our investors two different messages. One is, please, please reduce your leverage, and one is, please, please, do not change your leverage. And I have to tell you, we historically have been living with a level of leverage that's admittedly higher than others. We are at around three and a half net leverage right now. I want to just, for the anecdote, tell you that we've had in the past much higher levels of leverage and the much more difficult market conditions and much lower levels of cash flow conversion.

Ari Bousbib: And we've lived with that nicely because we have a highly predictable high visibility business model. Our strategy has been A, to invest in the business in capital expenditures, to innovate new products and services. B, buy companies that add that are creative and enable us to grow faster and see return money to our shareholders through share repurchases. And that has been a very effective strategy, especially when rates were extremely low. I remind you that just two years ago, Treasuries were at zero.

Ari Bousbib: Zero, and I'm very glad that we had that amount of leverage. Today, treasuries at what, five and a half. I mean, we've never seen this in history, such a sharp dramatic rise in interest rates in such a short period of time. Obviously, we are paying the brunt of our leverage, the price of that leverage. Because of that, and it's costing us 10 points, 10 points of growth in earnings per share. However, I would argue that mid-single digits treasury rates, you know, is high versus zero, but it's not the end of the world.

Ari Bousbib: I would also tell you that we bought the brunt of that sharp increase in interest rates this year in 23. And, you know, assuming like everyone else assumes that the curve, if it is to be believed, you know, indicates the stabilization and even a potential decline, then that should be ahead when I'm sorry, a pair went to our EPS going forward. And we don't anticipate a sharp increase in rates or interest expense going forward.

Ari Bousbib: And so therefore, we should be able to resume. That's a strong EPS growth going forward. That's for the leverage. Having said that, we are working, as we speak, on obviously refinancing and re-addressing some of the shorter term maturities, which we have in 24 in 25. And we'll do that, you know, soon, hopefully. And that will continue to alleviate. This year in interest expense and continue to stabilize our balance sheet. But for now, at least, we intend to continue to use our cash to invest in the business and do acquisition and share repurchase, especially at levels where we are.

Ari Bousbib: Thank you for your question. Any comment on the swap? Yeah, we have about 800 million dollars of swaps rolling off in the second quarter of 2024. You don't add anything to that next year. Which is an average rate of about, call it somewhere between two in a three percent. So, you know, we'll be ahead with next year, but not to the extent that you saw on the swap that rolled off this year. Thank you. Thank you very much.

Ari Bousbib: I will thank you, everyone, for joining us today. We look forward to talking to everyone on our next call. And myself and the team will be available for any follow-up calls. And any other follow-up questions you have across the day and over the next few days. So feel free to reach out. Thanks, everyone, for joining. This concludes today's conference call. You may now disconnect.

Operator: Please wait, the conference will begin shortly.

Operator: Thank you very much.