ITT (ITT) Q2 2026 earnings call transcript

Thank you, Liz, and good morning. Joining me in Stanford today are Luca Savi, ITT's Chief Executive Officer and President, and Mike Savinelli, Interim Chief Financial Officer. Today's call will cover ITT's financial results for the three-month period ended July 4, 2026, which we announced this morning. Please refer to slide two of the presentation available on our website, where we note that today's comments will include forward-looking statements that are based on our current expectations. Actual results may differ materially due to several risks and uncertainties, including those described in our 2025 annual report on Form 10-K and other recent estimates. The earnings call includes year-over-year commentary on the performance of SPX flow that reflects financial information before the SEC filings.

for the acquisition date of March 2, 2026. With that, it is now my pleasure to turn the call over to Luca, who will begin on slide three.

Thank you, Caroline, and good morning. Before I begin, I would like to welcome our new Aerospace Contacts colleagues to the ITT family. I look forward to working with you to grow CCT more and faster. We would also like to recognize our ITT all around the world for an outstanding performance in Q2 once again. And a particular thank you to our employees in Flow Technologies for their hard work that has enabled us to make significant progress on the integration of SPX Flow, whilst continuing to deliver strong operational and financial performance. In the second quarter, we accelerated the Q1 momentum. Our ITT has delivered strong performance across the portfolio through flawless execution and the realization of benefits from our acquisitions, building a solid foundation for the remainder of 2026 and beyond.

Now, to the momentum. We grew orders 53%, 13% organically. We grew revenue 51%, 13% organically, reflecting a boot to build of 1.1 for the quarter. We expanded operating margin 40 basis points. We delivered adjusted EPS of $2.08, up 18% year-over-year, and we generated $176 million of free cash flow year-to-day. A truly record quarter. Let's dive now into the details. On orders, CCT was the highlight of our Q2 performance, growing 59% organically. CCT's growth was fueled by large defense orders in our QSARIA business, which posted significant multi-year bookings across mission-critical platforms, such as advanced night vision applications and fighter jet programs. Quesaria grew orders 168%, and it didn't end there. We continue to see strength in early Q3, with record order bookings in July.

The Connector business also posted record orders, increasing 38%, fueled by growth in North America, Europe, and Asia. Moshe Technologies continued to win-win platforms and conquer near worlds in friction, feeding future market share gains. Conning orders were also strong, with 9% growth thanks mainly to China Rail and Defense. And lastly, Inflow Technologies will deliver 91% orders growth. Organic orders declined 3% year-over-year due to the impact of the third orders in the Middle East and the strong prior year performance that included very large oil and gas orders.

SPX Flow grew orders 9% in Q2 versus their prior year numbers, 23% growth in mixers across North America and China, 10% growth in Waukesha cherry borough, and 8% growth in nutrition and health, supported by strong systems orders in Europe. On revenue, this quarter's performance was fueled by organic growth across all our segments. CCT grew 17% organically, driven by strength across the portfolio. Commercial aerospace grew 14% from increased volume coupled with pricing benefits. Defense grew 16%, driven by strong performance in Kesaria, which grew 28% versus the prior year. We also grew industrial connectors 24%, led mainly by Europe and Asia.

Motion technologies revenue increased 6%, 2% organic, led by friction aftermarket, and outperformance of global vehicle production by more than 300 basis points, led by Europe and China, in addition to strep in China Rail. And finally, Flow Technologies' revenue was up 21% organically, or 123% in total. The teams continue to deliver higher pump project sales, up 45%, driven by shipments in marine energy transition and oil and gas markets. And we also continue to grow our VALS business up 19% as we keep on winning in Biopharma. Well done, Casturi and the Lancaster team.

SPX flow revenue grew 5% in Q2 and 9% year-to-date, in line with our full-year guidance of high single-digit growth. On operating margin, CCT's margin expanded 100 basis points over the prior year, and 240 basis points sequentially to 21.7%, primarily from higher volume and pricing. Motion technology's margin of 21.1 grew 90 basis points as a result of net productivity. End flow technology, excluding SPX flow, expanded margins 70 basis points fueled by market share gains and pricing.

Total flow margin of 21.4% was diluted by the full quarter contribution of SPX flow. Nevertheless, cost synergies from the integration, together with other productivity actions in the second half of the year, are expected to expand margins throughout the remainder of 2026.

As a result of our outstanding operational execution, we deliver a just DPS of $2.08, up 18% versus the prior year.

Turning now to capital allocation. As previously shared, we're prioritizing that repayment, and in Q2, we paid down $124 million, bringing our leverage ratio to 2.5 times, six months ahead of our original commitment. In July, we also deployed capital to acquire aerospace contacts. Though small, this acquisition is highly strategic to announce our supply chain resilience, secure supply of critical high-precision contacts, and in doing so, support continued growth with our connectors defense and aerospace customers. As you see, our legacy businesses are firing on all cylinders, and now are also taking advantage of some market tailwinds.

And as we shared during our Capital Markets Day, we are compounding and creating more value with our recent acquisitions. Let's turn to slide four to discuss these contributions. During the last few years, we've worked hard to cultivate and execute the right acquisitions. We focus on high-quality companies with strong management teams and solid fundamentals.

These acquisitions do more than add scale. They strengthen ITT's portfolio by increasing our exposure to higher growth, higher margin businesses, where we can drive additional value through differentiation in execution and innovation. This is exactly the playbook with Svanehoi. We enter the marine energy transition market, a market that has a lot of growth potential, today with LNG and in the future with ammonia.

Svanehoi's products and team are leaders in their market, and the results speak for themselves. Since acquisition, through the end of 2026, Svano is expected to grow revenue 32% on average each year, with a book to bill of 1.2. Our projected backlog at the end of 2026 will be up 40% since the acquisition. As a result, the acquisition multiple of 13 is projected to be just 6 at the end of 2026.

Thank you, Sore, Morten, and Johnny for this excellent performance. And the marine energy transition and market expected to remain strong.

Svanoy is well positioned for future profitable growth. Kesaria, another bolt-on acquisition, is also a success story. The defense market, which represents roughly 80% of Kesaria, provides a powerful market tailwind. Quesario's leadership and flawless execution enable us to enlarge portions of the prime programs we participate in. By the end of 2026, we are projecting to grow backlog 180% since acquisition and orders 60% on average each year.

This positions us incredibly well for the future. Quesario's acquisition multiple of 13 is expected to be 11 by the end of 2026. And we still have plenty of opportunities to expand margins with pricing actions and productivity initiatives. Thanks, my depotant team, for the quota of results. On SPX, we are in the early innings, but we are encouraged by how we started, the progress we have made, and the future potential. On the start, we are ahead of our plan and the team is working hard to accelerate.

We have a path to our high single-digit growth commitment with orders in the first half of the year growing 7% and revenue growing 9% year-to-date, resulted in a book-to-bill of 1.05.

We are progressing well and cost synergies are ahead of plan whilst we are working hard to build a strong foundation for future revenue synergies. On future potential, we have plenty of growth prospects in each business, be it nutrition and health, wakash at chariborale, mixers or pumps. And the funnel of opportunities keeps on growing. I'm encouraged by what I experienced at CETA, a small factory and business in Italy that is part of nutrition and health. I was fortunate to spend time with the local management, learn from their deep knowledge of the commercial and engineering teams, and observe the 5S of the well-run plant. This is a team that is ready to win and conquer more. Another site with great potential is our Shidu factory in China.

We spent time with Bruce Wang and the local team exploring how we can grow faster and more profitably in APAC and China by adopting a more entrepreneurial mindset and under-term continuous improvement approach and continuing to invest in innovation. As you can see, our acquisition playbook is indeed working.

In summary our legacy businesses will keep delivering value through above growth and continuous margin expansion whilst the acquisitions will compound value by doing exactly the same With that, let me now turn the call over to Mike Sabinelli, who is joining us for his first earnings call to discuss Q2 results in detail on slide 5.

Thank you, Luca, and good morning. As Luca highlighted, we delivered a very strong quarter. In Q2, we achieved outstanding growth across the business in revenue, adjusted margin, EPS, and cash. Our teams delivered a record $1.5 billion in revenue, growing 51% or 13% organically. CCT grew 17% organically, fueled by industrial connectors and aerospace and defense strength. CCT ended the quarter with a robust book to bill of 1.4. Motion technologies grew 2% organically, a significant achievement in the down market, driven by friction aftermarket and OE outperformance together with Coney growth. And finally, flow technologies grew 21% organically, driven by strong project shipments and from strength in short cycle, which was up 10% year over year.

Our strong top line performance contributed to operating income growth of 55% and margin expansion of 40 basis points, supported further by the full quarter of SBX flow, as well as strong execution across our legacy businesses. CCT delivered 23% operating income growth to a margin of 21.7%, a 100 basis point expansion driven by increased volume realization of pricing actions and productivity partially offset by material inflation. Flow technology has delivered a margin of 21.4%, a decline of 160 basis points, driven by the full quarter impact of SPX flow. We expect to expand margin sequentially throughout the year from cost synergy realization and other productivity initiatives. And MT's operating margin grew 90 basis points to 21.1% as the team drove net productivity of 110 basis points over the prior year.

As a result of our top-line performance and margin expansion, EPS reached $2.08 for the quarter, increasing 18% versus the prior year. Lastly, year-to-date free cash flow of $176 million was impacted by $71 million of one-time acquisition-related expenses, which we highlighted in Q1. Excluding these impacts, free cash flow was up 15% year-over-year, and looking purely at Q2, our free cash flow margin was 11% for the quarter. Let's now turn to the Q2 EPS bridge on slide 6. The 18% EPS growth was primarily driven by strong operational performance delivered by all legacy businesses, compounded by our acquisitions. Our legacy businesses contributed $0.36 of growth, of which Fonahoy and Caesarea contributed $0.12 of that, for market share gains, pricing, and productivity actions.

The full quarter of SPX flow contributed $0.68 of growth, with the impacts of the incremental interest, share count, and tax rate mostly offsetting this contribution. We are maintaining SPX flow's EPS accretion expectation of $0.10 to $0.14 for the year. I want to also stress that the net impacts of the tariff refunds were immaterial to the quarter at just a half million dollars.

Now let's move on to slide 7 to discuss our updated 2026 outlook. We are raising our full year organic revenue guidance range to 5% to 8% growth, driven by increased bookings in our CCT business, strengthen both flow technologies projects and short cycle, and continued friction OE outperformance, coupled with operational performance above our original expectations. On adjusted operating margin, we expect to deliver over 100 basis points of margin expansion to approximately 20.5% in the midpoint, fueled by top-line growth, favorable price-to-cost ratio, and productivity gains. As a result of the momentum we generated in the first half of the year, we are raising our adjusted EPS outlook for 2026 to $8.22 in the midpoint. This represents a 37 cents increase and 14% growth at the midpoint, fueled by volume growth, pricing actions, and productivity initiatives.

The low end of our new range now exceeds the high end of our previous guidance range. This revised guidance does not consider any additional net benefits from tariff refunds above the half million dollars from Q2.

Finally, on cash and capital structure, we are raising the midpoint of our free cash flow guidance to $565 million, resulting in a free cash flow margin between 10% and 11%. We made good progress lowering our leverage ratio. We are ahead of target and are driving towards approximately 2.3 times by year end.

Now let me turn the call back over to Luca to wrap up on slide eight.

Thanks, Mike. Before we move to Q&A, let me reinforce a few points. What you see in Q2, as you saw in Q1, is ITT's strategy in action. Our entrepreneurial spirit is accelerating growth in our legacy businesses. Our relentless execution is accelerating margin expansion. Our acquisitions are compounding organic value creation more and more. And in Q2, the momentum towards our long-term targets is accelerating. As always, I appreciate your time and continued interest in ITT. Liz, please open the line for Q&A.

Hi, Scott. Congrats on these numbers. There's really not much to pick on here at all. So I'm going to talk, I'd like to talk a little bit about SBX Flow because that's the newest asset that we need to learn here. Where, can you give us a sense, Luca, kind of where SBX Flow is in their kind of lean and operational excellence journey, kind of how you would compare them to kind of your legacy ITT businesses and such and where the upside is there? Sure. So I would say when we look at the plants, if it's Shido, if it's our plant in Poland, if it is even the factory that I visited in Italy, Seta, those are well-run plants, I would say.

And good 5S, Scott, and some good talent. I think though that the area for improvement that we have in SPX flow and the lean is really to ensuring that the lean is entrenched in the DNA in the cell. So today I would say it's probably more linked to what they were corporate initiatives, the A3 that you see stuck on the board, but not necessarily in improving the productivity in the cell or sometimes the material flow in the factory. So there is work to be done, but there is a good level of talent, and the plans tend to be, in general, with a good 5S.

Yes. When you look at the price cost, it's pretty much the same dynamic. You have a price cost positive when it comes to flow technologies and in CCT, because obviously we've got more price power in there. There are different dynamics in motion technologies where we are recovering some of the cost inflation, but not full, so there are pressures there. But at ITT level, we expect to be price-cost positive, probably neutral from a margin perspective for the full year.

Thank you, Scott.

Hi, Jeff.

Yes. So when you look at the funnel, so the order is a great performance. If you think about up 9% in Q2, year-to-date, our orders are up 7%. And also, our book to bill is above what? Our book to bill in Q2 for SPX flow is 1.13. So, good performance on there. What we see is really good recovery on the chemicals. So, if you think about the mixers dynamic, and we had a very good performance on the orders on the mixers. Good performance on Waukesha as well, 10% orders growth. And in nutrition and health, I can tell you that, just to give you a little bit more color, I participated to some very important bid reviews for large projects in Europe.

So good orders, book to bill above one, building backlog, and the funnel of opportunities in SPX flow is growing. And this, I would say, is geographically across the board, both in North America as well as in Europe.

Yeah, thanks. Sure, sure, Jeff. I mean, CCT was simply outstanding in terms of the orders. Everything was up. So it's not just CCT up 58%. Controls were up 22. Connectors were up 38. Quesaria is true. You're right, Jeff, in terms of lumpiness. Probably you remember that Q1, we postponed some of the orders from Q1 to Q2. But if you look at Quesaria today, orders up 46%. So there is really a market tailwind, which I was referring to in the prepared remarks. But there is a lot of market share gains. So we are participating in some programs, and we know that we have rewound that program and more. So this is good. Some of this has got long-term visibility, also to 28 and beyond, but I can tell you that the backlog that we have visible for Q3, Q4, and Q1 of next year, compared to what we saw last year at the same time, is considerably higher.

So, great growth for the midterm as well as long term.

Thanks, Jack.

Hi, Mike.

So if it's okay, Mike, to address the fully 2016 EPS guidance sequential and I talk about the order?

So I just want to mention that we had significant step up in performance in Q2. And for the balance of the year, for the second half, we expect to remain at that elevated level of performance. And then looking at each value center for MotionSec, we expect some seasonality in the second half. Expecting stable margins for CCT, we're expecting consistent revenue and margin similar to Q2.

And FT's margin expansion, we expect to expand from synergies. And talking about the orders, Mike, I think that different picture. If you think about CCT, as I said, incredible performance of the orders. There are some long-term programs that gives us fantastic visibility in the future. But as I said, in the short term, our backlog is incredibly up for also the next few quarters. So very good visibility there. When you look at flow technologies, the orders, you know, up, of course, 91% in total. But if I look at the book to bill, the Vanoi book to bill is 1.3. Just to give you an example. So if you have a business like this, which is growing 39% in Q2, on top of that, you've got a book to bill of 1.3 and you're building backlog.

This is visibility in the short, medium term. The SPX flow, the revenue is up 5% and the book to bill is 1.13. So we are building backlog for the medium term. And then when you go to motion technologies, we are winning more and more awards that will feed market share gains. And then, Connie, orders were also up 9%, thanks to Rayland Defense. So, great visibility for the long term, but also in the short and medium.

Of course. So let me address the Middle East first, and then we talk about the other regions. When you look at about the Middle East, I know that this might sound strange, but our business in the Middle East has been growing for the first six months incredibly well. And this is because of all the orders that we won in the last couple of years that we are delivering. We had a huge backlog, and we are delivering this backlog. So huge growth from a revenue perspective in Q1 and Q2. The orders in the Middle East have been delayed, and this probably will impact the regional growth in Saudi Arabia and in the Middle East when it comes to the next few quarters.

Now, what we have seen is that some of the orders are being now given to the EPCs. So we have started seeing some moves in terms of the orders, which is good. The other thing that I want to highlight on the Middle East is Habonim performance. Despite the fact that they're in the middle of it, Habonim has an incredible performance with orders up 18% in the quarter, revenue up 19%. Year-to-date, both orders and revenue up double digits, and book-to-bill above one. So, great over there. Now, if you look at the funnel, the funnel is increasing year over year. As a matter of fact, the funnel is up 34% year over year and 6% sequentially. When you look at the region, your question, North America, Latin America, and interesting Middle East are up.

Forget about the Middle East funnel up, because mainly that is because the orders get delayed. But North America and Latin America funnel up, highlight the strength of those regions, because revenue is growing, book to bill above one, so your orders are growing even more. And on top of that, your funnel is growing, so you're replenishing at a faster rate. So whereas Europe and Asia Pacific, funnels are down a little bit.

Thank you.

Okay, so you're absolutely spot on, Dan. We are winning shares across the board. Is it in Coney Rail? I was in China, and the team was presenting the market share that we have with China Race, LRC. Fantastic. We are winning market share in China with the Chinese OEMs, and therefore we are expected to increase market share there. We increase market share, you see, on the growth with a 21% revenue growth in flow technologies, organic. You know that we are winning market share there as well, mainly because of our project management and also in connectors. I would say we still have opportunities across the board, but probably more in the FT side and the flow technologies as well as CCT.

So this is where we can even grow faster and more.

Sure. So I think that when we look at SPX flow, let me give an example. A few weeks ago, I was in Shidu, China, where we have a very good plan in terms of SPX flow. But I think our approach in China could probably be adapted a little bit more to the market. What I mean by that, invest more on the engineering side, on the local application engineering, in some local R&D, so that we are actually adapting and making decisions closer to the market, closer to the customer. This is what has generated a lot of success for our friction business in China, for our economy business in China, and for our connectors business in China in the last few years.

So, decentralized, empowering, developing more the periphery and the markets like China will definitely be a great opportunity. Similarly, similar opportunities of CETAR, our small plant in Italy. I mean, that team is eager to win and conquer more. We need to ensure that we have to manage and more decentralized and make decisions closer to the customer and closer to the market. We are also working on revenue synergies, particularly in Latin America for mixers, I would say. And the polls that we have in the Middle East presents an opportunity for us to get ready with mixers or the Brian Luber pumps with localization in Saudi.

Thanks, Dan.

Hi, Joe.

Yeah, you're absolutely right, Joe. It looks like you were listening to some of our meetings. Yeah, we have a very good penetration in some of the Bay of Pharma with our Lancaster plan because of our proprietary technology with Envision. And we won incredibly well. This is a market where we can expand with some of the valves of SPX flow, but also with the mixers. So these conversations are happening, and we need that it could be a cross, a sales synergy that we probably were underestimating during the due diligence.

Sure. There are always, you're absolutely right, there are always two sides to the coin, right? So if our factory in demand gets penalized on one side in the short term, I mean, from the shipping perspective, in terms of what the business could be for Svane Oil, could be a positive one. If there is more investment in pipelines, pipelines will use the BB3 pumps. And interestingly enough, the BB3 is the pump that we went already completely, the complete range through VAVE, and we have a very good product. A product that has allowed us, actually, to win the Vaca Muerta project in Argentina. And then, as well, further investment in different regions could be also good for our Bornemann or Woods pumps.

So, for example, what's happening in Venezuela is probably going to be a great tailwind for our Bornemann pumps. Let's not forget that Venezuela was probably the largest market for Bornemann in the far past. So, definitely great opportunities across the board.

Thank you, Joe.

Morning, Nathan.

Sure. However, you know that I'm not an 80-20 guy, right? Listen, 80-20 is a good tool. Do we use it in ITT? Of course we do. We do on the safety, on the quality, use 80-20, absolutely. But I'm not a fan of the AT20. I'm a fan of the 100 and to go after. So if some of our competitors want to leave there the 20, I'm actually going after that 20.

So to be honest with you, we are reversing that approach of the AT20 and to have a much more rational and much more common sense. To be honest with you, what we are adopting is common sense and approach rigorously. That's it. It could be 80-20, it could be 90-10, it could be 100. So we are reversing that to be much more business savvy. Now, when it comes to the value-based pricing, the team is good at value-based pricing. When I talk commercially with Wendy or with Rudy, they definitely know their market, their customers, and they know exactly how to price different opportunities. And this is also in nutrition and health In some of those bids that I participated to Silvia the top salesperson and the management team are really able to push it to the right price and to the right value Interesting.

Sure. I think that the largest one on that front is the Bornemann Hygienic pumps. If we look at the Bornemann, you know, mainly in the oil and gas, the chemical, et cetera, but we have an application. We've got very good products for Hygienic. Now, having said that, we were nobody in hygienic. We didn't have the proper channels, and therefore, if you think about it, what Waukesha Cherry Burail had is really great channel on hygienic. So having Waukesha Cherry Burail to sell Bornemann Palms in the U. S. through their channel is really the greatest opportunity, I would say. And in some cases, they might have some strong distributor that we might not have in that region.

I'm talking about mixers, for example, with good pumps, and therefore we might have the benefit of utilizing their distributor instead of ours, and vice versa. That's really where we see the benefits.

Thank you, Nathan.

Hi, Vlad.

Morning.

Sure. Thank you. When it comes to SPX flow, the growth is mainly volume. There is little price on that one. And when also you look at our, if you look, for example, our legacy short cycle orders in flow technologies, they were up 5% in the quarter. Of that 5%, 4% is volume, is real growth, is volume growth, and 1% is price. So as you can see, we need to be much more surgical today when it comes to price. Having said that, our price-cost equation remains positive for flow technologies every quarter and for the full year.

Thanks, Luca.

Sure. So you're absolutely right. I mean, great performance on the orders. I would say also great performance on the revenue side, because if you look at also Q2, KSARIA revenue was up 28%. So great performance. As of today, we do not see any capacity constraint on the Kessaria front. As a matter of fact, when we look at the capacity, this is exactly why we made the acquisition of aerospace contacts. We were concerned of being able to feed the demand and the growth on the connector side, the air and defense, and therefore we purchased aerospace contacts, and now we have insourced that, and we are able to have a better, secure, and more resilient supply chain, but no real constraint from capacity from a Kessaria point of view.

Thank you.

Hi, Andrew.

Absolutely. I think to be honest with you, Andrew, you're right. I mean, every single place we go, we have plenty of opportunities for improvement. Absolutely. Now, I would say when you look at the margins, I think that motion technologies at 21.1% margin, they grew up 90 basis points. So great performance, I would say, if you think about where they play, in the market that they play, the pressure they're in. And so what we are working in motion technology is to consolidate and maintain this level of margin for the full year so that this is in it. It's solid rock. When you look at the CCT, CCT margin at 21.7 is actually a record margin for CCT, and this is with the dilution of Caesarea.

I mean, without Caesarea, this margin will be higher than 23%, and improve sequentially more than 240 basis points. So, I think that what you might be referring to is the dilution that we had in flow technologies probably is a little bit higher than what we were expecting. Okay? But having said that, at the 21, the legacy business in flow technologies is up 70 basis points, and we're already probably a great benchmark when you look in the market. So, you're right, a little bit of a higher dilution in Q2, but as we move forward, you will see this margin improving more and more because the productivity ramps up through the year, and you will have the acquisition cost synergies really starting having an impact.

Yeah, that is really more dilution by flow. Absolutely right.

Yeah, just a couple of things. I would like to bring it back to the full year picture. When you look at the full year picture, we are posting a really great growth, and we are raising the growth for the full year. Now, when you look at the dynamics sequentially, I've seen a couple of things.

First, it gets a little bit of a tougher compare, right, year over year, in terms of Q3 and Q4. Then what you have from a sequential point, from a year over year growth, you have to think about it that Q4 of this year will have four days less than Q4 of last year. So from year over year, you've got that dynamic. And then, of course, there is always the Middle East, where we have been growing tremendously in the first half, but because of the order's delay, there is going to be a little bit of a decrease when it comes to the next few quarters. Having said that, I would say, Andrew, if you look at sequentially, we are consistent.

So we have raised, if you look at Q3 and Q4, EPS guidance has been raised and stayed at elevated level. And for a full year, which is going to be pretty much outstanding. And there is, of course, also the empty top-line seasonality that happens in Q4. You know, with the market going on, in most of the cases, the customers tend to shut down, you know, early in December.

Thank you.

Hi, Joe.

That's true.

Sure. So, you know, everything is working well. So as you can imagine, Joe, we're very busy cultivating the right company. So the fact that we are delivering faster gives us a little bit more flexibility, but our priorities have not really changed. So the priorities today is really to pay down the debt, like Mike said in the prepared remarks, is really to execute on the synergies and deliver on SPX flow. Of course, there might be some bolt-on acquisitions that we're cultivating, and this goes across in flow as well as on the connector side of the business. You have seen aerospace, a very small contact, a very small acquisition, but very strategic. So small bolt-ons are in the pipeline and might be executed, but we are definitely busy cultivating as well as paying out that and delivering the synergies.

I think that's a very fair point, Joe, but I would say is that we are lucky to have it both. And what I mean by that is Quesaria is winning important platforms, and you have the visibility for 28. So if you look at jet programs, so we are winning our fair share and more because we're winning market share. You have that. But when you look at the backlog, because, you know, every quarter we look at the backlog for the next four quarters and we compare to the backlog that we had one year ago for the future growth at that time. And I can tell you that our backlog that we have in our hands for the next three quarters is considerably higher.

So for the next quarter, sometimes the backlog is higher by 30%, two quarters that allow by 20%, and for the next year, it's already 20% higher than what it was one year ago. So you've got great visibility in the long term, but also much more backlog for the short term.

Thank you, Joe.