Operator: Good morning, and welcome to Pitney Bowes' Q3 2026 earnings conference call. Today's call will include remarks by Pitney Bowes management, followed by a question and answer session. In order to ask a question, please press the star key followed by the number 1 on your touchtone phone at any time. I will now turn the call over to Alex Brown, Assistant Treasurer and Director, Investor Relations. Please go ahead.
Alex Brown: Good morning and thank you for joining us. Included in today's presentation are forward-looking statements about our future business and financial performance. Forward-looking statements involve risks and uncertainties that can cause actual results to be materially different from our projections. More information about these items can be found in our earnings press release, our Form 10-K, and other reports filed with the SEC that are located on our website at www.pb.com and by clicking on Investor Relations. Please keep in mind that we do not undertake any obligation to update forward-looking statements as a result of new information or developments. Also included in today's presentation are non-GAAP measures. Specifically, EBIT, EBITDA, EPS, and free cash flow are all on an adjusted basis. You can find reconciliations for these items to the appropriate GAAP measures in the tables attached to our press release.
Alex Brown: We have also provided a slide presentation and a spreadsheet with historical segment information on our website. With that, I'd now like to turn the call over to Kurt.
Kurt Wolf: Good morning and thank you for joining us today. We continued to deliver strong results in Q3 with year-over-year improvements in EPS, adjusted EBIT, and adjusted free cash flow, despite our increase in investment and growth. Our results in Q3 and the start of Q4 have given us confidence to up the midpoints of our revenue and adjusted free cash flow guidance range. Now I'd like to quickly address our five key strategic priorities. Presort picked up significant volume late in the quarter as a result of PCI's exit from the market. These volumes will create a year-over-year tailwind over the next four quarters, but I also believe this exit is further evidence that the industry margins are near a cyclical low and that more rational industry pricing is likely in the near future.
Kurt Wolf: Regarding our SendTech segment, we were able to achieve higher margins despite increased growth and focused investment, thanks to continued cost discipline. That said, the previously mentioned termination of a non-core contract during Q4 will create a headwind for this business during 2027. Moving to Pitney Bowes Bank, we continue to invest in technology and infrastructure to support future lending platforms, and all three pilot programs continue to make progress, particularly our logistics lending platform. With respect to capital allocation, we completed a tender offer for $46 million worth of our long-dated debt at a discount to par and also reduced our Term Loan B interest rate by 75 basis points through a repricing. Finally, our strategic process has entered the external review phase. As mentioned at the start of our last call, we will not answer questions related to the process, but will provide updates as appropriate.
Kurt Wolf: In summary, we executed well across all of our strategic priorities, and momentum continues to build as we focus on achieving profitable revenue growth by the end of 2028. As always, I will end the call by thanking the exceptional team of more than 6,000 Pitney Bowes employees that I have the pleasure of working with. The results we are delivering and the momentum that we are building is entirely thanks to their hard work and dedication. With that, let's open the call to questions.
Operator: Thank you. We will now conduct the question and answer portion of the call. Again, in order to ask a question, please press the star key followed by the number 1 on your touch-tone phone. Our first question will come from the line of Aaron Kimson with Citizens. Please go ahead.
Aaron Kimson: Great. Thank you guys for the questions. I'll start with Presort. Good morning. I'm modeling mail volumes of about 130 million pieces sequentially in the quarter, so that'd be 520 annualized. That obviously ignores any seasonality. You commented you won 2 billion pieces annualized from PCI since it shut down in August, and a lot of that volume came late in the quarter you just mentioned. Can you help us think about how much of the net new volume in the quarter was driven by PCI versus the net new logos and Boomerang customers you've previously spoken about? And to the cadence of how the PCI volume may come into the network over the next few quarters.
Kurt Wolf: Yeah. Thank you for the question, Aaron. We don't have the specific numbers on that to offer. We don't go to that level of granularity. I'd just say the majority of the volume gain was tied to gains from PCI.
Aaron Kimson: Okay. That's helpful.
Aaron Kimson: On the decision to invest in the Presort network organically with the sortation equipment refresh, how should we think about any initial capital outlay for that equipment and what the payback period on those investments might look like?
Paul Evans: Yeah. Hi, Aaron. This is Paul. It's great opportunities for us. Generally, we see the paybacks 2 to 3 years. Sometimes it can be a little bit longer, but on average, it's about 2 to 3 years. We are putting out capital this year. We'll put out capital next year for that. But we're doing this because we believe in the Presort business and this is the right thing for us to do.
Aaron Kimson: Got it. Congrats on the strong results.
Kurt Wolf: Thank you, Aaron.
Operator: Our next question will come from the line of Curtis Nagle with Bank of America. Please go ahead.
Curtis Nagle: Great. Thanks so much. Yeah, so obviously really interesting news on PCI, and I think you mentioned a second competitor. I guess in terms of just maybe, A, sizing the opportunity set, and perhaps how much business do you think you can win? Curtis, I think you alluded to this, potentially some near-term pricing investments, maybe scaling the scope of that and, ultimately longer term, how should we think about, I guess, the degree of how underpriced you think the industry is now, and how that affects longer term margins?
Kurt Wolf: Yeah. Good morning, Curtis, and thanks for the question. With respect to pricing, I guess what I could say is what really happened, and I apologize for a long explanation, but hopefully this will make it perfectly clear. in July of 2024, there was a rate case that increased the workshare discount substantially. So margins expanded across the entire industry, which set off like a gold rush for customers. What you saw is competitors being increasingly aggressive trying to win new customers because the margins just had expanded significantly. PCI in particular, this is just our opinion, got extremely aggressive on pricing to the point that they left themselves no margin, presumably due to transportation costs, diesel, et cetera. My view is they more or less drove themselves out of business being too aggressive on pricing.
Kurt Wolf: I think this is driven by that rate case that created those high margins. What you're seeing now is much lower margins. You're seeing it for us. You're seeing it, Capitol Presort exited service, I think December of last year. PCI exited September of this year. You can never make too much of rumors, but Debbie's heard scuttle of other competitors having some serious problems. The reality is, I think there's a that you would expect there to be a recognition from the industry that pricing as it stands today, it's not sustainable for the long term. Our expectation and again, we can't drive we're a dominant player, but we can't set price. We can only react to the price that's out there.
Kurt Wolf: Our expectation is that based on where competitors and us stand in terms of margin, that pricing should start to go up just to get players to sufficient ROI to justify continuing to operate in the space. As we said in the letter, again, we expect that to happen, but we're not resting on our laurels. We're doing a lot to integrate the PCI volumes. There's a lot of work to be done there, so we expect to get a lot of margin pickup from that. We can talk more about it if you'd like. But also as Paul spoke to, we're making a lot of investments to continue to bring down our cost of operations so we can get higher margins and better ROI on the business.
Curtis Nagle: Okay. I mean, since you mentioned it, yeah, if you could, I guess elaborate more on the margin rate you expect to get from PCI, that'd be awesome. Appreciate it.
Kurt Wolf: Yeah, absolutely. So with PCI ceasing operations, one thing that is, this just demonstrates some of the value that we offer in the space. We are the one national player. So when people looked and said, "Hey, we have a lot of volume we need to move," we were the natural choice. So we picked up a disproportionate share of the volume out there. Some of it is we want to secure clients. We want to have good partnerships. These have tended to be the larger customers that we picked up, so the pricing there was lower, just the economics of the industry. As far as margins going forward, we have absorbed an additional 14%, 15% roughly of our volume.
Kurt Wolf: As you can imagine, in an industry where you are trying to run at 100% capacity, if you add 15% capacity immediately, you end up with a lot of overtime. You end up with suboptimal operations in the short term. So our thought going into this was to take the volumes we could, and then adjust on the back end to correct, to start to hire permanent employees, set our network such that we can handle the volumes without having to go to extraordinary lengths. So over time, as we adjust to the new volumes, we expect margins to improve.
Curtis Nagle: Chris, thank you.
Kurt Wolf: Yep. Thank you, Curtis.
Operator: Our next question will come from the line of George Tong with Goldman Sachs. Please go ahead.
George Tong: Hi, thanks. Good morning. With respect to SendTech, can you size the revenue associated with the non-core contract that is winding down? If you exclude that, what the underlying revenue trajectory should look like in 2027?
Kurt Wolf: Yeah, George, good morning, and thanks for the question. It is a decent chunk of revenue. Think of it in the $60 million to $80 million range in terms of revenue. So it is a pretty big hit for us. The thing that we really want to accentuate is, this truly is non-core. This was a part of the old GEC. This was a fulfillment business. We do not do fulfillment. It is not even close to any other business that we do. It was just a profitable business that was left over from GEC. So we always knew this business was going to go away. So that is going to be roughly a $60 million to $80 million hit for 2027. I would say absent that, there is no doubt in my mind that we would be at growth in 2027 were it not for the loss of this one contract.
George Tong: Got it. That is helpful. Then with respect to Presort, in the quarter, revenue per piece fell a bit. Can you talk a little bit more about that, what drove that, and whether that specific pressure should persist?
Paul Evans: Yeah. George, this is Paul. I think Kurt touched on it in his previous answer, but obviously we brought in some of PCI in September. I don't think we'd go down to the granularity of the volume, but that had an impact on our RPP, as we call it. At some point, we will mean revert. We ingested what Kurt said, around 15% of our overall volume. That just as we optimize. So there will be some mean reversion over time as we get back to what we think are more normal, sustainable pricing.
George Tong: Got it. That's helpful. Thank you.
Kurt Wolf: Yeah. Thank you, George.
Operator: Our next question will come from the line of Jasper Bibb with Truist Securities. Please go ahead.
Jasper Bibb: Hey, good morning, guys. Maybe wanted to follow up on a prior answer. I guess I am wondering what the incremental margin might look like on those PCI volumes. Or maybe if you do not want to comment on PCI specifically, typically what those incremental margins look like for Presort when you see volumes rising like this.
Kurt Wolf: Yeah, Jasper, good morning. Generally what I would say, and this is true of just about any business. The larger a customer is, typically the lower the pricing, the lower the margin. So this was a disproportionately large customer. So overall, the pricing you could assume was below our typical pricing, just because of the size and same with the margin. It is going to be a lower margin customer. And just to be clear, that is something that will persist. This is because they are larger customers, we do see pricing in the industry or expect pricing in the industry to start to adjust and become more rational. But to be clear, it is not like these customers we are going to increase price on specifically. It is just that we expect margin to come across the entire portfolio of customers, if that comes through.
Kurt Wolf: I would just say lower margin due to larger size, and it is not a one-time hit. It will be a persistent hit because they just are larger customers, and going to naturally be at a lower margin for the long term.
Jasper Bibb: Thanks. No, that makes a lot of sense. I think you mentioned in the letter this quarter that you are increasingly confident the business returns to growth by the end of 2028 or sooner. I guess my question is, what are you kind of seeing that gives you increased confidence? And maybe I will point my question a little bit more specifically at the SendTech segment, given we have already talked about a lot of the good things going on in Presort on the call.
Kurt Wolf: Yeah. So with respect to that, and I'll get to SendTech. One thing I'd say is, historically as a company, I would say we've made two mistakes, typically. One is we identified one idea that we jumped onto wholeheartedly, like GEC, and pursued, and it may not have always been the right idea, or we've made a lot of peppered investments across a whole variety of opportunities. I will get to SendTech, but when we think about growth, we're trying to think very holistically using a very broad aperture. Not to get too wonky here, but I previously was co-founder or founder of three successful startups. And the discipline that a startup has is that you have to go in front of a VC and convince them of an amazing idea.
Kurt Wolf: The problem that happens with corporate startups, for lack of a better idea, is you have a parent that says, "We need growth. What do you have?" And then it's much easier to get an idea through. So what we're doing is being deliberately thoughtful and not just saying, "Hey, shipping's an opportunity for growth." We think it is, but we're going to wait for the great idea or make sure that we have the right idea. But beyond that, when I talk about broadening the aperture, are there other things we can do beyond just what the obvious is? Are there opportunities to use the Pitney Bowes Bank to help grow Presort, and that's something that the Pitney Bowes Bank is now doing. So we're thinking more holistically, what are all the good ideas out there, so we have more ideas to choose from.
Kurt Wolf: So when we talk about growth, it's not a guarantee it's going to come from one place or the other. There's ways we're looking at use of our data. Within the organization, we think we can help generate growth. Just the information that we have, we can use that to make better decisions with our customers, et cetera. So there's a lot of initiatives we're talking about. I do think with SendTech we'll get there. Obviously, shipping software is an amazing opportunity. So I don't want to say by 2028 necessarily that SendTech itself will be at a pace of growth. There's just confidence with all of the initiatives we have across the three business, SendTech, Pitney Bowes Bank, which is currently a part of SendTech and Presort, as well as other ideas we have that are more holistic and use the advantages we have with our existing business.
Kurt Wolf: We're very confident that we have enough good ideas, that if you think of it from a VC standpoint, we have enough good ideas in the hopper that some of those are ultimately going to pan out as we pilot and test them, and we'll get to growth overall for the company. So I know it's a non-answer answer. I'd like to think that SendTech is going to get to growth in 2028. But the increased confidence really comes from the fact that we have a lot of really good ideas internally that we're exploring.
Jasper Bibb: That's really helpful. Maybe one last quick numbers question. I think the Q4 adjusted EBIT implied by your guide is seasonally a little below where things normally are as you go from the Q3 into the Q4. Can you just frame that for us? Would you say that's more conservatism? I know you have some expense timing things this quarter versus the Q3. Any kind of context there would be great. Thanks.
Paul Evans: I mean, you've seen what we've done through the year where we have more clarity. We've adjusted our guidance, and I don't mind if you call me conservative in the way I approach things. That's okay. Look, there's some things that we look back on Q4 of last year, it was exceptional in some respects, so we think about that. But right now, what we've given for our annual guidance is where we're comfortable. But I understand the exercise that you've done. You've backed out the full year to isolate Q4 EBIT, and I respect the question, and we thought about that too. But we're comfortable with our guidance for the year. We've shown that how we've tightened the range.
Kurt Wolf: Jasper, a few things that Paul's mentioned, we talk internally as well. Last Q4, we had, I believe it was a $5 million benefit to EBIT as a result of, I think it was equipment revaluation. So we did have some things that helped us last year. The other thing, and again, thankfully, I have Paul and Alex and the whole finance team to help me on the accounting questions I don't fully understand. But there's a lot of, I think, when you get into Q4, there's a lot of questions in terms of bonus accruals and things like that create a lot of variability for your Q4. So we wanted to keep a large range, not because we're not comfortable with where the business is going, and we're not trying to be overly conservative.
Kurt Wolf: It's just a recognition that there's a lot of things that can come up in a Q4 from an accounting standpoint that could ultimately lead to results that are a little harder to predict.
Jasper Bibb: That makes sense. Thanks for taking the questions, guys.
Kurt Wolf: Yeah. Thanks, Jasper.
Operator: Our next question will come from the line of Anthony Lebiedzinski with Sidoti. Please go ahead.
Anthony Lebiedzinski: Thank you, and good morning, everyone, and thanks for taking the questions. With the exit of PCI in Q3 and you guys strengthening your position as the dominant player in the presort market, do you think there is an opportunity for you guys to be more of a price leader as you talk about improving pricing and margins? As we look back historically, late 2024, the Presort margins were high 20% range, even got to a little over 30% in the early part of 2025. I know there are some headwinds with higher fuel and transportation costs, but maybe if you could just talk to us as far as the timing of the pricing and margin improvements that you expect. How do you guys think about that?
Kurt Wolf: Anthony, good chatting and good morning. What I would say is we're not a leader. I would argue we're not a leader in terms of pricing. We are going to do what's right for our business. Right now, our belief is, across the entire industry, margins are particularly low. We look at our business, assume that we're one of these smaller players. I can only imagine the margins they're seeing, not as attractive as we are. Right now, it doesn't make a whole lot of sense to be investing in a space just based on the low returns people are getting. Our expectation is, we're focused on getting price, in part because as you highlighted, our costs have gone up dramatically. Diesel prices, lack of drivers. There's a whole host of issues that are really facing the industry, us and our competitors.
Kurt Wolf: There is a flow-through effect to ultimate customers. Our expectation is that as we do that, a competitor is not necessarily going to come in and have a significantly better pricing offer simply because they're facing the same costs that we are. Likewise, as we're trying to compete to get other people's business, we have to be very cognizant, particularly given that we've taken the volume on, that our costs are higher. I think in general, everybody's doing what's right for their business. As people price, the margins just aren't sustainable at these low levels in our view. Our expectation is pricing is going to be higher on a go-forward basis. Added to that, we are looking at things like fuel surcharges, et cetera. We may have signed a contract when diesel was at $3 a gallon, now it's at $7 a gallon.
Kurt Wolf: That's dramatic cost increase in a contract we might have signed 2, 3 years ago that was profitable, may not be profitable anymore just because of diesel prices and the lack of drivers. I'm sorry, there was a last part of your question that I know I didn't address. Can you repeat what that was?
Anthony Lebiedzinski: Sure. Absolutely, yeah. In terms of looking back at the Presort margins, I know. This goes back to your comment, Kurt, earlier about how margins got expanded back in 2024. As we look at historical EBIT margins for Presort, they were in the high 20% range, even got to a little over 30% in early part of 2025. I guess the question is, at some point, do you think you can get back to those types of margins or not perhaps, given some of the headwinds that are out there?
Kurt Wolf: I think that period was a very. You saw what happened when our margins got to that level.
Anthony Lebiedzinski: Right.
Kurt Wolf: It is that pricing just came down.
Anthony Lebiedzinski: Right.
Kurt Wolf: To say we can get back into the 30s, I am not so sure that is the case. A few more things to note, by the way, something to keep in mind is we have corporate expense that we cannot efficiently allocate or effectively allocate down to Presort. So Presort margins for us are actually lower than what we report because of that. So again, apply that to our competitors, their margins are lower. But when we look at our Presort business, as we think about where our margins are now, the stress in the industry, the fact that we have seen presorters going out of business at this level of margin, it is almost tautological or it just follows logically that margins need to go up industry-wide. I have only been in this chair for 16 months, something like that.
Kurt Wolf: I continue to learn now that I am inside the company, and it is giving a much better sense of what is probably reasonable. I think, mid-20s on margin is probably mid, I think maybe even a little above mid-20s, but I do not see us getting back into 30s for a sustainable period, because I think at that point, pricing will kick in. One last thing to add, I know it is a long answer.
Anthony Lebiedzinski: Yeah.
Kurt Wolf: But again, we continue to invest. The investments we are making, we believe are continuing to give us a better cost structure than our competitors, which will support higher margins in the long term, simply because it is a higher level of investment. We will be at a higher investment level than competitors conceivably, but also hope that should translate to higher margins as well. That is another thing that gives me confidence in getting to the mid to upper 20s for margins in the Presort business.
Anthony Lebiedzinski: That is very helpful. Just one other question I have. As far as the corporate expenses, this year it has kind of bounced around, roughly $22 million Q1, almost $27 million in Q2. Here, it was roughly $33 million in Q3. How do we think about the corporate expenses going forward? If you could just also explain as to why we saw a pickup here on a sequential basis, that would be very helpful. Thank you.
Paul Evans: Yeah, sure. Hey, Anthony. What happened in Q3 is we reclassed some of our costs. We gave the benefit down to our business units. But the long-term trend is we see corporate SG&A continuing to decline as we further sort of find efficiencies in how to run this overall business. We still are looking for ways to allocate more of our corporate costs to the business to appropriately value those businesses. But the big number in Q3
Anthony Lebiedzinski: Okay
Paul Evans: is approximately a $10 million reclass from
Anthony Lebiedzinski: Okay. All right. Well, thank you very much.
Kurt Wolf: Yeah. Thank you, Anthony.
Operator: Our next question will come from the line of Kartik Mehta with Northcoast Research. Please go ahead.
Kartik Mehta: Hey, good morning. Kurt, maybe just to understand a little bit about the SendTech margins. You guys have done a great job expanding those margins, and as you talked a little bit about this non-core customer or this revenue going away. As you look at that segment of the business, is there an opportunity to reduce costs or do other things to be able to sustain the margins that you have in this business? Or do you think as we go into 2027 with the loss of that customer, the margins will be pressured in 2027 compared to 2026?
Kurt Wolf: Yeah. Thank you for the question, Kartik. Let me make a few comments on that. First of all, losing this non-core piece of business, it will be negative for margin just because you lose some of the leverage. The margin on that business on an internal accounting basis, is about equal to other businesses. But the reality, we are going to end up with effectively stranded costs that we cannot eliminate because it was a shared services across the overall business. Again, a non-core piece of business, but it was an attractive piece of business. Unfortunately, that will be a hit to margins. Then, another hit to margin in the short term, and I will address the counteracting piece of it, is we are really focused now on getting the growth.
Kurt Wolf: We are already investing, and that is one of the things I am really proud of the team for delivering. We are hiring people, we are purchasing software, we are investing in growth in the business, and we are still able to improve our margins or improve profitability. But we are going to continue to invest in growth as we come up with more and more of these opportunities, and we start to grow into those opportunities. That will create a headwind in SendTech as well. But the one thing I will say is what we have really focused on, even prior to me stepping in for the last almost three years now, or two and a half years, has been a culture of continual efficiency improvement. We are not looking to do RIFs, we are not looking to do significant cuts. But it is a part of running a business these days. I think, what was it?
Kurt Wolf: Microsoft recently announced, I think, a cut. There have been some large companies that are very successful out that are reducing costs. We are constantly looking at opportunities where we can reduce costs. Todd and his team, Debbie and her team, Steve and his team are all doing a good job of balancing investment and growth while also figuring out ways to save and create efficiencies within their business so that we can offset some of the costs that we are putting into growth initiatives. It is a longer answer.
Kartik Mehta: Okay.
Kurt Wolf: But I guess what I would say is in the short term, I would say that SendTech margins, probably roughly in the right ballpark. One thing to note is assuming we break out the bank. The bank is currently reported as a part of SendTech, so you are going to see, you will naturally see a change in the margin reported for SendTech if the bank is no longer reported as a part of it. But if you combined SendTech and the bank, you would get back to those same level of margins, more or less.
Kartik Mehta: Fair enough. Then just a follow-up question on the free cash flow. Obviously, you raised your free cash flow guidance. I think there were some net working capital benefits as a result. As you look at your free cash flow over the next 12 months or maybe going into 2027, how much of the free cash flow is sustainable because of just improvements in the business versus improvements in working capital?
Paul Evans: Look, I mean, obviously, we have realized a lot of the benefits and improvements in working capital, and Kurt talked about we are continually improving our cost structure, so we realize benefits from that. One way to look at it, I will tell you how I look at it. I look back at the LTM free cash flow, and it is just astounding what this business provided with the right focus. Obviously, we were confident to up it for the year. Again, it is just a strong sign of how much free cash flow opportunity is available here. I do not believe 2027 will be as high as 2026, but it is certainly still commendable where our cash flow will be going forward. But to break it down into the components, I would say we are always looking for opportunities for working capital benefits. We naturally have some built into our business by its design.
Paul Evans: I think we have used those in a very appropriate manner. As you can see how we have allocated capital and the shares that we have repurchased and how we have kept our debt flat and we have cut our interest expense and then a number of other things.
Kurt Wolf: Kartik, to add to that, a couple of quick things. I think there is a lot of variability as you have seen within our business from a working capital standpoint. 2026 appears to be, we are having tailwinds as a result of it. You do not always have tailwinds, so at some point, we unfortunately will face headwinds and all analysts, I am sure you will sit there and look at our business and normalize. One year is going to be too high, one year is going to be too low. In reality, somewhere in the middle. Another thing just to call out is twofold. One is, as I mentioned, we are increasing investment just because we have identified attractive areas for investment. So we do expect with the sorter refresh, we are leaning heavily into that. We have under-invested in prior years. So we are going to be accelerating investment. So CapEx, we have a catch-up.
Kurt Wolf: We may get to a point where we are over normalized CapEx, but we are going to need to catch up for years of under-investing. Compounding that is that historically, because we were in such tight financial conditions, we would typically lease a lot of equipment, so those payments were spread out over years. What you may see, for example, is a year like 2027, when you compare that to a year like 2024, let's say in 2024, we were leasing, so our CapEx on sorters might have been low, first of all, because we were under-investing, but even lower still because the cash impact, because we were leasing instead of just outright purchasing.
Kurt Wolf: We are going to get double hit in the short term because we are going to increase our expenditure on sorters, but we are also going to continue to have lease payments when we couldn't just outright buy the equipment. There is going to be a small transition period where we are paying old leases and new CapEx that won't carry those future lease payments with them. We will talk more about it as we discuss guidance for 2027. But those are some things just to keep in the back of your mind as you try to model for 2027. We are always going to do what is right for the business, and sometimes that means taking a short-term hit to cash flow just to get the business where it should be in terms of how we operate on a go-forward basis.
Kartik Mehta: Yeah, that makes sense. Thanks for the explanation. That is helpful. Thank you both. Appreciate it.
Kurt Wolf: Absolutely. Thank you, Kartik.
Paul Evans: Thanks.
Operator: At this time, I see no further questions in the queue. I would now like to turn the call back over to Kurt Wolf for any closing remarks.
Kurt Wolf: All right. Yeah. Thank you everybody today for joining. Just like to make a few final comments. First of all, I cannot express enough gratitude to all the employees here at Pitney Bowes. I opened by saying that, and I close by saying it. I would say what we are accomplishing right now is nothing short of amazing, and it is due to, like I said, the 6,000 employees here. Hopefully investors and analysts are starting to realize the discipline and excellence that we are showing in execution, and that we are starting to get some appreciation and credit for our ability to execute on plan.
Kurt Wolf: The second point I would go from there is what is really exciting for me as the CEO of this company is for so long we have been focused on trying to fix what we have, and now we are really pivoting to a focus on how do we grow and how do we have success going forward. So, this will be a new chapter, and as analysts, what you are going to see is increased investment. You are going to see increased investment not just from a CapEx standpoint, but also from a cost standpoint. We hope that we have earned people's respect and appreciation that we can execute on plans. So we do expect a period of transition where we are investing in growth before we get the revenue from that growth. But it is important for the success of this business that we get to revenue growth.
Kurt Wolf: That is ultimately what all investors want, and it is going to be a period of transition. A lot of companies typically will. You acquire something, which we did when we bought the Newgistics business. It is an easy way to get revenue growth right out of the gate. We are trying to do it what I believe to be the right way, which is to prudently build for the future. So we are in this period of transition. But again, I think our ability to execute gives me a lot of confidence that as we are making these investments, these investments will pay off. So I am looking forward to the day where we start talking about all the growth initiatives and the actual positive revenue that we are starting to put on the board that is also tied to increased profitability.
Kurt Wolf: Thank you everybody for listening and thank you for your continued trust in us and the management team and the employee base. Thank you all.
Operator: This concludes today's Pitney Bowes Q3 2026 Earnings Conference.
