Operator: Good afternoon, and welcome to the Emerson Third Quarter and Full Year 2026 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to your host, Doug Ashby, Director of Investor Relations at Emerson. Please go ahead.

Doug Ashby: Good afternoon, and thank you for joining Emerson's Third Quarter 2026 Earnings Conference Call. Today, I'm joined by Emerson's President and Chief Executive Officer, Lal Karsanbhai; Chief Financial Officer, Mike Baughman; and Chief Operating Officer, Ram Krishnan. As always, I encourage everyone to follow along with the slide presentation, which is available on our website. Please turn to Slide 2. This presentation may include forward-looking statements, which contain a degree of business risk and uncertainty. Please take time to read the safe harbor statement and note on the non-GAAP measures. I will now pass the call over to Emerson's President and CEO, Lal Karsanbhai, for his opening remarks.

Surendralal Karsanbhai: Thank you, Doug. Good afternoon, everyone. I'd like to begin by thanking my Emerson colleagues around the world for delivering an outstanding quarter. We have created momentum in our business built on customer intimacy, investment in innovation and operational execution, all a testament of the strength of the Emerson management system. Please turn to Slide 3. I would like to recognize our Chief Technology Officer, Peter Zornio, who will retire on December 31, following an exceptional career at Emerson. Peter joined Emerson in 2006 and played an instrumental role in the development of our industry-leading control systems and software portfolio. He has been a key member of the executive leadership team in our automation business since 2017 and played a pivotal role driving innovation as CTO during our portfolio transformation. Thank you, Peter, for your contributions and friendship over the past 20 years, and please know, it has been an honor working with you. I'm also excited to announce Rudy Sengupta as our Senior Vice President and Chief Technology and AI Officer effective August 15. This appointment reinforces Emerson's strategy to lead in AI-enabled automation, advancing the full technology stack and helping customers achieve autonomous operations at scale. Rudy joined Emerson through the acquisition of NI and brings decades of experience in software-defined automation, spanning engineering, product and corporate strategy and operations. Currently serving as Vice President and General Manager of Test and Analytics Software, Rudy has advanced NI software differentiation, including the development of award-winning Nigel AI. He brings a deep understanding of technology and AI, and his leadership of our enterprise AI vision and long-term technology road map will be key in accelerating innovation across Emerson, and positioning the company for continued growth. Please turn to Slide 4. End market demand is robust, supported by secular trends in our growth verticals and a meaningful investment in automation. Underlying orders grew 7% in the third quarter, with broad-based growth across all business groups, led by Software & Systems, which was up 10%. Demand was strongest in North America and Asia, and I'll discuss demand trends in more detail on the next slide. Emerson delivered an outstanding third quarter with sales, margin expansion, earnings and cash, all exceeding expectations. Underlying sales grew 6%, led by sustained momentum in Test & Measurement, and in our Ovation business, both up 23%. Overall, our growth verticals were up 27%, led by semiconductor and power, which both saw significant growth. Adjusted segment EBITDA margin expanded 140 basis points to 28.5% and adjusted earnings per share grew 13% to $1.71, above the top of our guidance. Annual contract value of our software grew 9% year-over-year and ended the quarter at $1.68 billion. While the situation in the Middle East remains dynamic, the resilient efforts by our teams and customers drove a better-than-expected performance in the quarter relative to our reduced expectations. The demand environment in the Middle East is constructive with repair work underway. Our field service engineers are now operating at pre-conflict levels, but customer operational capacity remains approximately 75%. Large projects are moving forward, and we are seeing new opportunities emerge across the energy chain to support energy security and resiliency in the region. Emerson's customer relationships and strong local presence position us well to capture the near-term investment priorities, pipelines, and alternative export routes to reduce dependence on the Strait of Hormuz. The long-term capital outlook is robust, and we remain confident in the growth potential of the Middle East. Lastly, the year is shaping up largely as expected with a meaningful second half step-up in organic growth and a slightly better Middle East than what we forecast in May. We are raising our full year guidance, reflecting strong third quarter results and healthy demand trends. We are raising sales growth expectations to 5% with underlying growth of 3.5%. Adjusted segment EBITDA margin is still expected to be approximately 28%, and we are raising our adjusted EPS guide to $6.55. Through the third quarter, Emerson completed $898 million of share repurchases, and we remain committed to returning approximately $2.2 billion of capital to shareholders this fiscal year. Please turn to Slide 5. Underlying orders grew 7% in the third quarter, with broad-based demand across the portfolio as customers are investing in automation to enhance productivity, reliability and resilience in their operations. North America and Asia drove the growth, led by the continued strength in the U.S., India, Japan and Southeast Asia. Demand in Europe and China remained soft, but showed signs of improvement in the quarter. Test & Measurement orders growth of 19% exceeded expectations, with semiconductor up 70% and double-digit growth in aerospace and defense and the portfolio business. We are seeing a continuation of the unprecedented investment in power generation with orders in our Ovation business up 31%. Electrification is also driving exceptional activity in grid modernization and ACV in AspenTech's digital grid management suite was up 28%. Our project funnel grew $1.2 billion to $12.4 billion, up 8% year-over-year. Secular tailwinds are supportive of sustained capital activity in our growth verticals, which were up $1 billion sequentially. Power was up $450 million from the second quarter and now accounts for $3 billion of the funnel. The power generation build-out is accelerating with substantial demand for both utility and behind-the-meter power. The need for more stringent cybersecurity in critical infrastructure is also leading customers to accelerate retrofit and upgrade programs. The LNG funnel grew $350 million to $2.2 billion, and we see resilient momentum across the Americas and the Middle East, reinforcing the demand trajectory we outlined at our Investor Day last November. In the third quarter, Emerson won approximately $400 million from the funnel. 80% came from our growth verticals. And I want to highlight a few key wins. First, Emerson was selected to retrofit control systems for a 2.1 gigawatt power plant for CFE, Mexico's largest power producer and national utility. Emerson will deploy its industry-leading Ovation control system, which was selected for our proven ability to execute complex retrofits within accelerated time lines. This modernization will enhance plant reliability and support CFE in meeting Mexico's growing power generation demand. Next, Emerson was chosen by China Nuclear Power Engineering Company, the design firm for the new Hualong-1 pressurized water reactor in Guangdong province, which will add 2.4 gigawatts to China's nuclear installed base. Emerson will supply pressurizer pilot-operated safety valves, one of the most critical valve applications to ensure overpressure protection of the primary circuit. We were selected based upon our strong application expertise, nuclear qualifications and our local presence and support. Lastly, Emerson will provide NI Semiconductor Test Systems for a leading semiconductor manufacturer based in Taiwan. Emerson's solution improves test accuracy and consistency for critical components, ensuring a faster product road map to help the customer capture opportunities in the AI market. With that, I will now turn the call over to Mike Baughman to discuss our financial results and guidance in more detail.

Michael Baughman: Thanks, Lal. Please turn to Slide 6 for a more in-depth look at our financial results. Q3 underlying sales growth was 6%. Each of our business groups exceeded expectations, led by Software & Systems up 11%. And I will provide more details on geographic and group performance on the next 2 slides. Price contributed 3 points to growth and MRO was 65% of sales. Backlog ended the quarter at $8.2 billion, up 7% year-over-year, and our book-to-bill was 1.0. Adjusted segment EBITDA margins of 28.5% were up by 140 basis points. Margin expansion exceeded expectations due to better volume than expected and favorable segment mix. Price cost and cost reductions more than offset inflation. Adjusted earnings per share was $1.71, up 13% year-over-year. Operations contributed the full $0.19 increase reflecting outstanding performance. Q3 free cash flow of $1.3 billion was up 36% and at a margin of 27.1%. Cash exceeded expectations due to good operational performance, along with the impact of tariff refunds and the timing of tax payments, which shifted from Q3 to Q4. Year-to-date, free cash flow was up 9% with a margin of 19%. Please turn to Slide 7 for details on Q3 underlying sales by region. The Americas were up 8% with the U.S. up 10%. We saw a very healthy pace of business in the U.S. with Software & Systems up 14% and Intelligent Devices up 9%. Asia, Middle East and Africa was also up 8%, led by the Middle East and Africa, up 11%. As Lal mentioned, a great performance by our teams in the Middle East resulted in a revenue impact that was better than our revised expectations coming into the quarter. Overall, the impact in Q3 was about a $25 million headwind compared to our February guidance, and we expect the Q4 impact to be similar as supply chains remain complex. China improved to down 3% year-over-year, which was in line with our model, and Europe remained soft as expected and declined 1%. Globally, our growth verticals continue to be meaningful drivers of performance, and we were up 27% in the quarter. Growth was very strong in semiconductor, which was up 53% and Power, which was up 37%. Please turn to Slide 8 for details on the third quarter underlying sales and margin performance for our 3 business groups. Software & Systems grew 11% underlying with robust growth at Test & Measurement, up 23% and Control Systems & Software, which was up 7%. We saw significant Software & Systems growth in power, semiconductor and aerospace and defense. Software & Systems margin of 31.8% decreased 30 basis points year-over-year compared to a very strong performance last year. The current year margin included a drag of 1.5 points due primarily to the software contract renewal dynamic and a higher mix of lower-margin projects. Intelligent Devices underlying sales were up 5%, better than expected due to our performance in the Middle East and the timing of project shipments and sensors. We saw consistent strength in power and LNG, as well as solid growth in midstream gas and chemical. Intelligent Devices margins of 27.9% increased 240 basis points year-over-year from volume leverage, price cost and cost reductions. Safety & Productivity was up 2% underlying, driven by electrical products and industrial activity in North America. European and automotive markets remain soft. Safety & Productivity's margin of 21.2% was up 80 basis points year-over-year, driven by disciplined price cost and cost reductions, offset by lower volume and inflation. Please turn to Slide 9 for our 2026 underlying sales guidance by business group. We expect Software & Systems to be up approximately 10% in Q4, with both Test & Measurement and Control Systems & Software expected to grow 10%. We are increasing our full year expectations for Software & Systems to up 6%, based on the strength of our growth verticals in this business and strength in the U.S. We are raising full year growth guidance for Test & Measurement, now 14%, and Control Systems & Software, now 3.5%, including approximately 3 points of headwind from software renewals. ACV continues to grow on plan, and we still expect ACV growth of 10%-plus in 2026. Intelligent Devices is projected to grow 3% in Q4 and 2% for the full year. Growth in Intelligent Devices is supported by stable MRO with strength in the U.S. and growth verticals. We are modeling an approximately $100 million full year 2026 impact from the conflict in the Middle East as the Strait of Hormuz remains effectively closed. Safety & Productivity is expected to grow 1% in Q4 and 2% for the full year. The North America market continues to recover, and we are seeing sustained strength in electric utilities. However, automotive and European markets remain weak. Overall, Emerson expects to grow approximately 5% in Q4 and 3.5% for the full year. Please turn to Slide 10 for details on our full year and Q4 2026 guidance. We are raising full year guidance for sales, EPS and cash flow. For the full year, we expect 5% GAAP sales growth and 3.5% underlying sales growth. We still expect adjusted segment EBITDA margin of 28%. We are guiding 2026 adjusted EPS of approximately $6.55 and free cash flow of approximately $3.6 billion. There are no changes to our planned return of approximately $2.2 billion to shareholders through $1.2 billion in dividends and $1 billion of share repurchase. Moving to the fourth quarter. Sales growth is expected to be approximately 5% with minimal impact from FX. We expect adjusted segment EBITDA margin of 28.5% and adjusted EPS of approximately $1.85. Overall, the full year is unfolding largely as we expected, and underlying orders growth of 7% for the first 9 months reflects stable MRO activity and the secular tailwinds driving long-cycle capital projects. A stronger-than-expected growth in the U.S. has offset a slightly weaker China, and we have minimized the effects of the Middle East conflict to approximately 0.5 point of revenue. Our second half underlying sales growth is accelerating as we lap the software contract renewal dynamic and execute project shipments from our backlog, which continues to grow year-over-year. With that, I would like to turn the call back to Alexandra for Q&A.

Operator: [Operator Instructions] Your first question comes from the line of Deane Dray with RBC Capital Markets.

Deane Dray: I think I got the numbers right there, as Mike was zipping through them, but it really sounded like semiconductor and power at 53% and 37% were really standouts here. Can you unpack the growth opportunity? How much do you think was the underlying market? And are there any share gains going on as well, new product contributions, that type of color, please?

Ram Krishnan: Deane, this is Ram here. Certainly, the underlying market in both semis and power, as you know, is very, very strong, but I will contend that certainly in power, both on the generation side with Ovation, with fleet modernizations but also behind-the-meter opportunities driven by data centers and new capacity adds in North America there is significant penetration gains or participation gains we're driving. And similarly, with our DGM business, our digital grid management business on the software side with AspenTech. So a combination of a strong market but participation gains. And I would venture to say, maybe to a lesser extent, in Test & Measurement, but a very, very strong market in RF and mixed-signal and participation gains with new products in both spaces.

Deane Dray: Great. And then just as a follow-up, and Lal, your comments about increasing focus on cybersecurity and critical infrastructure. I mean that was in the news this week with all of the cyber hacks across the water sector, a number of facilities, especially in Michigan. Now I know that's not a big focus for Emerson, but you do have a presence there. And this idea here that cybersecurity is a focus, how do you think this plays out? Is this a place for future investment for Emerson? What kind of opportunity do you see?

Surendralal Karsanbhai: No. Thanks, Deane. So just first of all, yes, we're very aware of the facilities that were impacted. None of those facilities had an Emerson or an Ovation control system in them. So that's first and foremost. Secondly, cybersecurity spend has been a significant driver of upgrades in control systems, both in power generation and in water systems. And we continue to see that, Deane, as a significant driver on a forward basis, particularly with these attacks and other vulnerabilities that are in light. So feel good about the offering that we have and the various standards that we bring to market, but a very important part of the business for sure.

Operator: Your next question comes from the line of Jeff Sprague with Vertical Research.

Jeffrey Sprague: The funnel movement is quite intriguing. Obviously, you gave some anecdotal color, the growth in LNG and power in the funnel. Just also wondering, is this even increasingly long-dated sort of project activity? In other words, kind of conversion of funnel to proposal to order. Anything changing there of note?

Surendralal Karsanbhai: No, not really. Look, we continue to see about the same level of awards in the quarter. If you recall, we won approximately $400 million. That's very similar to the amount that we reported in the second quarter as well. So the timing of financing and awards continues to move relatively consistently over time. What we're seeing is just a very significant increase in the number of projects and the value of projects, particularly -- well, I'd suggest across all the growth verticals, but certainly in liquefied natural gas, which was up 19% and in power. And now we have almost 1,000 projects, individual projects in the funnel across those 2 markets alone. So continue to see good conversion there. And again, as you note, Jeff, we don't look at this. This is not a 10-year funnel. This is a relatively 3- to 4-year view and we do work it very, very actively in the quarter.

Jeffrey Sprague: Great. And then unrelated, maybe pivoting to Mike. Just a little bit of update on where we're at on price cost at this point, 3% price look pretty healthy in the quarter. Are you sort of "green on price cost"? And just any tariff update there, refunds you may have gotten in the quarter or expectations in the current quarter for anything on the refund front?

Michael Baughman: Yes. Price cost certainly remains green for us. And if we look to the full year, we were tracking to about 2.5% price for the year. That's still the case, might catch a rounding and be at 3%, but we continue to see good price and managing the inflation, which we certainly have seen. I think as we head into the fourth quarter here, we will be lapsing all of the tariff pricing. So we did have a little bit of tariff pricing in Q3, but the majority was just our annual and spot prices that we do through the year. So that -- yes, so price has been strong and we're green on price cost. Relative to tariffs, we got $82 million in the quarter. We continue to file some claims. Just a reminder that we are accounting for those on a cash basis as we get them and we report them in cost of sales. So the margin certainly on a GAAP basis improved in the quarter due to that $82 million that we saw. So yes, and that was certainly part of the cash flow performance in the quarter as well, the receipt of the $82 million of refunds.

Jeffrey Sprague: And even with that $82 million, do you have net cost headwinds related to other tariffs or other changes? Or we should if you had some drop through the margins on that.

Ram Krishnan: Well, that was taken out of our adjusted. So it's been removed. And the tariff landscape has obviously been changing, some tariffs have come off, some tariffs have come on. When we look at the year, we certainly got a net benefit that was largely eaten up by other inflation that was above and beyond the model that we had when we started the year. So a little bit of a tailwind to the bottom line, which was what we talked about and expected last quarter. So pretty much tracking the way we expected.

Operator: Your next question comes from the line of Scott Davis with Melius Research.

Scott Davis: The Ovation orders, I think you said, up 31%. I think you said, Mike, up 31%. But what kind of lead times are you looking at now? Are you taking orders well into, I would imagine, well into maybe even the back half of '27 at this point?

Surendralal Karsanbhai: That's exactly right, Scott. We're sitting in the fourth quarter of '27, reaching into '28 at this point.

Scott Davis: [indiscernible] Okay. Fantastic. I'd call that high visibility, I suppose, anyways. And I think Mike said something positive about chemicals, and I haven't heard a positive thing you said about chemicals in a lot of years. So have we turned a corner there? Or it's just a little bit of a blip and chemicals could actually be somewhat helpful to you guys in the next couple of years?

Michael Baughman: Yes. The chemical comment was specific to Intelligent Devices. And it was a bit of a change in the quarter, and it was up, and that was largely in the Final Control business. We still have slow chemical markets in China and Europe -- in Europe. But the United States and Middle East is doing very well. So it was up in the quarter. We did want to make that comment, and it was particularly up in the Final Control business.

Operator: Your next question comes from the line of Andrew Obin with Bank of America.

Andrew Obin: Yes. It's remarkable that turns out companies can exclude IEEPA refunds from their numbers. Sorry, sorry about this quip. Anyway, but thank you for taking a more conservative approach. Look, just a question on Middle East. I think you said repair construction is underway, $25 million headwind in third quarter, fourth quarter to be similar. So the question is, so Middle East rebuild opportunity is larger today and starting, but still in that drag in the fourth quarter. Does it flip to a tailwind in the first quarter of '27?

Surendralal Karsanbhai: It's a good question. It really -- in the status quo, in terms of an on-off situation of the Strait of Hormuz challenges with getting product out of the Gulf, I think that's going to continue to be touch and go. Maybe conditions improve, and that gets a little bit better for us as we go through the second half of 2027. But right now, as we're planning, I would expect to be realistic that the -- certainly the fourth quarter and perhaps into the first quarter of this -- of our fiscal year, the conditions remain relatively the same.

Andrew Obin: And then maybe can we just talk a little bit about software. I think you said ACV was up 9%. Underlying sales were 7%. So can we just talk about sort of the pace of contract renewals year-over-year? And just generally, I think software, a big topic of conversation last quarter. This quarter, I guess, we're back to inflation. But just what are you seeing operationally given all the sort of brouhaha about sort of new solutions coming in? Just give us some color as to what you're seeing in the numbers.

Surendralal Karsanbhai: Yes. No, we -- underlying sales just a correction there, 6% on underlying sales, underlying orders were the 7% number that you referenced. But yes, you are right, ACV growth of 9%. Ram, if you want to comment on the business as a whole.

Ram Krishnan: Yes. So ACV 9%, and I think we feel pretty good about exiting the year at 10-plus percent on ACV. So I think from a software perspective, the dynamics of -- if your specific question was the renewal dynamic, that certainly reverses in the fourth quarter, and you'll see that reflected in the numbers in the fourth quarter. And then all segments of our software business, whether it is the Aspen core business, certainly, DGM, when we threw out the number there for DGM was 28% growth in DGM. So that continues to accelerate. The ACV performance there is very, very strong and then certainly on the Test & Measurement side as well. So our software business is executing according to plan. I think exiting the year at 10% gives us confidence about a very, very solid 2027.

Operator: Your next question comes from the line of Alex Virgo with Evercore ISI.

Alexander Virgo: I wondered if you could just flesh out a little bit of that power demand for us. Is that still mostly brownfield now? Or are we actually starting to see some of the more greenfield projects with your comment there on Q4 '27 and moving into '28. I just would like a little bit more detail on that. And then as a follow-up, really strong numbers on Test & Measurement. So really great to see that. One of your peers talked about a -- concerns of a slowing market as you roll into next year on tougher comps and the length of the cycle. So without pushing you for guidance for '27, I wondered if you could give us a sense of the visibility that you have in that business and what we should be thinking about as we do start to think about '27?

Ram Krishnan: Great. I'll take the one on power. Power to date, which has been extremely strong, has been mostly fleet modernizations. But we are starting to see, particularly in the quarter we concluded, but going into Q4, and into the early part of next year, some of the newer capacity coming online, certainly gas-fired in North America will be a big part about the tailwind. Certainly, the data center opportunity, you can classify that as behind-the-meter, and that's greenfield. And then certainly, on the DGM side, which we also capture in power and nuclear power, a lot more of that is greenfield. So yes, you're going to start seeing more of that in the numbers. But to date, that the momentum has been on fleet modernizations or brownfield, as you referenced.

Surendralal Karsanbhai: I'll follow up on the semiconductor question. Look, we're not going to obviously guide into '27. You can certainly read into the tremendous order momentum that we have in the semiconductor business within T&M today. But I will highlight that there is a differentiation in growth in the applications from the laboratory, where I think the period that you're referencing largely plays to the validation and production side where we largely play. And that has a different dynamic on growth and in the cycle as well. And so at this point in time, I continue to be relatively robust on semiconductors through 2027.

Operator: Your next question comes from the line of Andy Kaplowitz with Citigroup.

Andrew Kaplowitz: Well, maybe just your thoughts on MRO in general. I think you've highlighted it today as stable. But I think generally, it's seen, it's been pretty strong across you and your peers. So what are you seeing there is that, I assume, led by North America, but obviously, we're running facilities pretty hard. So what are you seeing going forward here?

Surendralal Karsanbhai: Yes. Really, no material change to the MRO rates anywhere that we've observed around that 2/3 of the business level. That seems to be pretty consistent. There continues to be spend on replacement. We have seen, and I think to your point, we have seen some delays in shutdown turnaround activity because exactly, facilities are being run relatively hard right now. So that -- we'll see how the fall season ultimately shapes up there, which will -- would may have an impact to MRO activity, but day-to-day MRO continues to be very strong for us across the every -- just about every region and every business.

Andrew Kaplowitz: And maybe related to that, Lal, like just growth by region, obviously, China has been kind of slowing Emerson down a bit, but maybe a little bit better here. And I think you mentioned Europe a little bit better. We've had mixed reads this quarter out of Europe. So sort of what are you seeing outside of North America? And does it give you a little more confidence in improvement sort of outside of North America and outside of the Middle East?

Surendralal Karsanbhai: Yes. No, look, again, obviously, Andy, we've spoken how bullish we continue to be about the U.S.A. and the investments that are being made in the U.S.A., and I think that's got a significant amount of legs to it, and we were up 10% in sales in the U.S. in the quarter. I don't expect that to subside. Recovery in Europe. Look, Europe was down 1 point in sales in the quarter. But again, a little better than expected. Orders were positive in Europe. So that's a good sign as we go through the last half of this -- last part of this year and into the first quarter of next. And then China, slightly better, still negative, mid-single-digit negative, but we believe improving certainly sequentially and as we go into next year. So that's kind of how that environment looks like. And then, of course, other Asia was very, very strong, and that's powered by Japan and India and Southeast Asia. Go ahead, Mike.

Michael Baughman: No that's it. It's great.

Operator: Your next question comes from the line of Andrew Buscaglia with BNP Paribas.

Andrew Buscaglia: If you guys could expand on the China comment. First off, -- was it -- did it stabilize in the quarter? Is it as expected? And then within Intelligent Devices, I wonder, can that growth rate get back to kind of historical peak levels without China really picking up? Or do you think there's enough growth in North America and elsewhere to more than offset it and get back to like types of growth we've seen in the past in the double digits in that segment?

Ram Krishnan: So on Intelligent Devices, the answer is, absolutely. I think as -- if you looked at orders performance as a leading indicator, I think you'll start seeing that. Now a majority of the sales impact in the Middle East is in our Intelligent [ Devices ] business. So you'll see that obviously suppress the growth rate so far, but that will unlock in Q4 and into next year. So yes, no concerns about the return to growth of Intelligent Devices. Now our guide there is 3% to 6%. I mean we've had years of double digits, but Intelligent Devices are in our long-range framework, our Systems & Software business is a 6% to 9% growth business, which includes Control Systems and T&M and Intelligent Devices in 3% to 6%. So we feel very good in that framework. And then your question on China. China, I think minus 3% is better than what we had seen in the first half. So it is improving, and it was sequential growth in Q3 over Q2. So again, we expect China to continue to improve into low-single-digit type growth levels as we planned for 2027.

Andrew Buscaglia: Okay. Fair enough. And my other question is on software control. I think someone tried to get at this, but I'll ask it in a different way. But there's been a lot of noise in that segment in the last couple of years. And can you just help us kind of rebase what you anticipate to be more of like a through-cycle growth rate in Software & Systems? And then how do we think about that growth more in an upcycle now that we have this Test & Measurement business that you didn't have in the past cycles to anchor us to it? I guess I'm trying to get at, what's the 2027 number look like if we are indeed in a strong up cycle?

Ram Krishnan: Obviously, it's a little early to comment yet on 2027. But if your question is, what is our thinking as we built this portfolio around long-range growth for soft -- the control systems part of software and control as well as Test & Measurement, they're both in the 6% to 9% type framework. That's kind of how we are thinking about it through this cycle?

Andrew Buscaglia: Through the cycle. So presumably more than that, though, and if orders are starting to pick up and accelerate from here.

Michael Baughman: Was there a question, Andrew? Sorry.

Andrew Buscaglia: Yes, I guess I'm just saying if orders are accelerating here, should we anticipate more of the high end of that or better in an up cycle?

Michael Baughman: Well, certainly, T&M this year is in that up cycle and is certainly outside of the range. So yes, when things are on an up cycle, they can get outside above that range?

Ram Krishnan: Yes. T&M is 14% this year or so, yes.

Operator: Your last question comes from the line of Ken Newman with KeyBanc Capital Markets.

Kenneth Newman: Maybe just to ask the greenfield question in a different way that was asked earlier. Ram, I appreciate the comments on the power and the semi markets that you made earlier. Is there a way to help frame how much of the total project funnel today is for new greenfield versus brownfield? And I'm just curious if you're seeing any kind of material differential in pricing for those new orders versus the 3% you [ recorded ] this past quarter?

Ram Krishnan: Yes. So majority of how we define our project funnel, the bulk of it is greenfield. And the brownfield modernization has led separately, and it's a different cut we take to those type of funnels. I mean the pricing, obviously, we get better pricing on the modernizations than we do typically on greenfield, and we get better pricing on MRO than brownfield. So that's somewhat consistent with how we've always kind of positioned it. But most of the $12.4 billion, I would say, venture to say, we look at that as greenfield.

Kenneth Newman: Got it. That's helpful. And then look, I know the crystal ball on the Middle East is kind of clear as mud in this environment. But just given what you're hearing from your customers, do you -- do they have any comments or thoughts about what kind of stability or a certain amount of stability in terms of timing that they need to see before they can start to normalize orders back to pre-conflict conditions? Or is that just too hard of an exercise to do at this point?

Surendralal Karsanbhai: It is. It's a challenge. We're seeing new projects coming online, particularly related to pipeline, storage, transportation, built on the resiliency of their networks, obviously trying to avoid the Strait of Hormuz and now avoiding the Red Sea as well. So there is a challenge there. There are certain products that are easily transportable via pipeline, but there's some that are impossible like LNG. LNG is -- can be transported over a couple of miles. But you're just not going to build a 400-mile pipeline to take LNG. So there is -- are a lot of challenges that customers are wrestling with right now. And I think they're going to need certainty in some kind of an agreement between the United States and Iran before things calm down and there's some trust back in the system.

Kenneth Newman: Whenever that situation does come to fruition, is there a way to think about how quickly you would expect to see those orders come through?

Surendralal Karsanbhai: I think relatively quickly, to be very honest. We're seeing really good activity in quotation and preparedness for some large petrochemical expansions, LNG field expansions in Qatar, so we know that's coming. And so we expect that to be released relatively quickly.

Operator: There are no further questions at this time. This concludes today's call. Thank you for attending. You may now disconnect.