Kimberly-Clark (KMB) 23 Apr 242024 Q1 Earnings call transcript

Company Profile

Participants

Christopher Jakubik	executive
Michael Hsu	executive
Bonnie Herzog	analyst
Nelson Urdaneta	executive
Anna Lizzul	analyst
Lauren Lieberman	analyst
Nik Modi	analyst
Christopher Carey	analyst
Stephen Robert Powers	analyst
Javier Escalante Manzo	analyst

Call transcript

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Operator

Good morning, everyone, and welcome to the Kimberly-Clark First Quarter 2024 Earnings Call. [Operator Instructions] It is now my pleasure to turn the floor over to your host, Chris Jakubik. Sir, the floor is yours.

Christopher Jakubik

Thank you. And hello, everyone. Head Q&A Relations quarter session update. Jakubik, welcome Kimberly-Clark, XXXX Chris our to for is of at Investor and business This our first

our these Actual filings results forward-looking differ due and make on During our and with we in may we uncertainties, our risks are release and how today. SEC. that discussed based some things see to today, remarks are the statements will earnings

be non-GAAP discuss GAAP also measures non-GAAP a financial should measures and some posted not can results. find with these will We the non-GAAP today, be should release earnings at GAAP supplemental financial our and considered you together materials for . replacement investor.kimberly-clark.com. to and read within the reconciliations And

Chairman opening Hsu, a Before we begin, I'm comments. going our CEO, few for and to quick to hand Mike it

Michael Hsu

over you, at provide Thank to like all by Okay. into get a Hey, who chapter foundation results to we start our of and Kimberly-Clark, very I deliver worked next past my Chris. the these you growth. that to to would Q&A, diligently QX build our saying the to colleagues few strong thank good years start before really

elevate expand innovation with categories markets is our working. to breakthrough strategy Our our and

navigating ever-changing effectively culture. dynamics new of today's while are We the driving external normal our consumer-centric

and achieve to making we're strengths going that confident I'm are to our better, very, our date, potential. stronger core the I'm and progress faster. to We company very to proud of our leverage continue

sustainable on returns. well to are positioned deliver durable We exciting shareholder growth and path an are and

it that, your I'd for with to open up So like questions.

Operator

Instructions] [Operator

Goldman from coming is Bonnie first Your from Herzog Sachs. question

Bonnie Herzog

well. all you're Hope

a have quick your I question guidance. First, on

QX. better-than-expected a reported You

What color the improvements beat? key hoping to was little how full Or pass continued for through we volume year to quarter. volume any moving saw this? were curious you curious, more expect should And hear better-than-expected then the also So the sustainable you the see QX growth for And there And behind forward, progresses? ultimately, as in a this forward? the why is pull instance? on didn't drivers

Michael Hsu

Bonnie, to our I'll with for organization I'm will and start about what new would think Yes, through And call going first and very on. really, that. we of internally had and we the encouraged of few running well But right? a is is talk our think very, decided that I start logic in Nelson things a maybe like what a the stable that despite I good our a business normal, kind this year geopolitical we've lot pass are

was of there's underlying in forward. one, predicated quarter couple pull So you factors: on good which the a the and strength fundamental volume, better no observed,

kind was consumption had of fact, kind inventory the opposite. reduction -- -- in -- the -- of quarter. overcompensated for volume inherent In overshot an We that. in the I it But the inventory think retail the

And so right are -- shares think moving was kind think the also that market in I I the direction. probably of when

was that little underlying with productivity on So we in through the input about that, to I then good then the quarter bit in feel drop And business. the tends stable environment, strong cost the volume top stronger bottom a a think momentum line. very of the

there. on team a has couple QX. underlying as been volatile, well it. still strong wars you're great there's a in and teams driver aware, about And our our -- world, of has feel operating really that's And we Argentina job the job great are kind so of doing great The a of the going very done

really normal we're feel a well Nelson? we in So environment. like running new

Nelson Urdaneta

America, And Mike company, basis the our with in first, March, was year. And as flowed a China the in and in particularly That consumption benefit for trends as start quarter. had And happened And points from the the by quarter. double Year digits particularly which I perspective, North we of the in obviously, said, very -- was came to happened Yes. QX add in January. in XX in that in as continued. saw particular, QX business just execution. few just of a around a March much grew had in we through volumes total while mean, we China trade in in growth. And still on strong the significant so in the projected what March, back destock pleased details better month the Chinese -- New

things the we reconciled a other So in uptick. and Having the volume at the was balance said, as few that numbers we all we're the said begin going about And have for we're we Mike quarter. begun couple some that, happened commodities as to happen of geopolitical is of of what's of what see to challenges optimistic, aware have underway. year, the our look that cautiously still bit on thought as things. One, we to

pulp in we've the fiber in how quarter the the Just digits QX. quarter, increased and first has for the seen versus single first perspective, in complex sequentially

to now million net the perspective, around expect year, inflationary. For full input be to cost, $XXX the in be the -- commodities we total basket

that are account. that back we're into watching. we taking provided That's we in January, it's within that but So still range the have something

be from spend year to back further beginning for back news something the that of expect basis year. in we another $X.XX as of see QX, that as in of we a the balance our year will that's around QX. progresses. head year, to in And investments we investments was that A basis and That year the we up, built mind versus half pipeline to largely is that it in profit. is points builds line in increased at keep further personal bit and up an that said into what other progresses, equipment we year-over-year keep points. our is outlook, we the mind other On -- up innovation our as provided in expect outlook couple but starting XX in January. the as step new advertising will what had of with XX step is the we That's we the into the basis, headwind And divestiture we the about protective the things to is the

Operator

Your of from America. Anna next Lizzul question coming Bank is from

Anna Lizzul

you paper, end was can market of comment wondering on I lack with in some A ladder a toilet the which share. pressure at if competitor mentioned lower pricing part their on the a misstep caused there. innovation of

share. helped helpful. for volumes category pick that if basis, clearly wondering you follow-up, that how were a on reductions a if can was And progressing had that market retail then than QX. I comment as despite you're better the some to up share. of you you anticipated in Also weighted terms be And expected in would inventory on So quarter

was the I impacting extent what ended it full just how should So about up quarter? the to thinking year? this we for wondering And be

Michael Hsu

share for Great question. Market very the thanks Ana, Yes. question. Okay. I'm encouraged.

solid the I market combinations. category were in year in and as made very, share. -- overall the just we've market progresses. think quarter, progress the further Overall, we improvement of very XX% on in year I our expect up under even

flat basis, on both at a also ways in say would weighted look I metrics. we X and Although on share

up as year. severe supply was predicated had categories. soft I'd North of We Importantly, may last that America XXXX, X that recall, improving. constraints we were you America on even lot of or in say North in a X was

quarter we've supply. restore think in of of row the I And this that maybe so our was kind performance I And that had and a reflects second ship promotion. of to like product think unconstrained ability kind

cold it? points XXX Kleenex share Just What basis drove quarter which other is on the in for we new flu points and very up more or have several had for around restored was merchandising, season, reference, which social we has basis I very, campaign Well, did than been off been But XXX allergy months. on share. we media good. the -- part think from

again, merchandising so still our we're normalized we're I of think overall behavior. just returning versus And of -- under-indexed so to probably merchandising, kind But still we category. the kind --

performance a And hundred we on couple feel markets a New had share again, diapers Year Chinese points we strong of China, up execution. in basis overall. very, our couple good So very were -- like a other in about Huggies market

category So still against was volumes the China. in about XX% were up double that down digit

very So performance good optimistic and delivery business. about the about of we're feeling the feel of the I the business volume overall, think

Nelson Urdaneta

just back on volumes in-market And expect But as on I a to the still mean, for reflect to planned We innovation delivery programming. Hence, and changes into build Mike's January don't and pipeline had to go your the place into of of coming account the and versus that point volume from what on of programming question XXXX half we the QX. mainly volume we as balance our have why, the into over second any year. QX in innovation said we're the January, lot pacing and see of the should and we year. we in the an what overall had perspective and plans, taking we in

Operator

coming Your next question Barclays. from Lieberman Lauren from is

Lauren Lieberman

first $X $XXX was million the articulated in savings Day. the this you million of that the or about Investor the of out prepared billion ask at in called also release that the I productivity So realized remarks, thing to I and to how about the And think in wanted context productivity in was $XXX you SG&A just quarter. curious

just So my first that's first question.

Michael Hsu

a tracking good comment. we're Nelson I say will will start and well.

Nelson Urdaneta

billion to and just then $XXX bit of give little $X the And million, Lauren. on the color Yes. a

on So value we've accountability, about really different the March. past, visibility, the which a margin focus what it's really, discipline, a our This integrated very the or is total overall, the Day costs working first, chain. new end lower and deliver based in had so. Investor at management on process year as whole given for the us we been in a And of a unveiled we driving it's last cost, on approach it at across that end-to-end enterprise-wide has

this you had our and the remarks. productivity. I'll we As the nonprocurement-related reiterate, is year release about start said, gross we is this and to $XXX on talked in a that savings, in million prepared strong the and

the which, in savings also that that's were these of again, we additional of and headwind much input embedded efforts. delivered side house, the procurement net a quarter net all were And costs, our the because had and not first that from in of

And what on be would deliver about that and have cadence expect number. years off as we roughly next the think good expect billion, a to we're $X to over whole start about that the the we we to billion. $X few the As linear we on

this a the with In million as of savings, we terms of live go $XXX operating X model will year. of new SG&A October on reminder, our

expect materialize again, But XXXX. year will really in savings to into don't we the much of this come good XXXX $XXX a in in procurement-related SG&A really year. to and in That play productivity and So that savings. million more start

Lauren Lieberman

awesome. That's Okay.

what some things, seen, good in this of a interesting -- sales couple side SG&A last a XX I that operating operating what you SG&A. there called as the I quarter, of leverage to advertising is leverage pretty on also, saw see you'd this follow-up, percentage remarks point was in prepared basis increase which pretty the a as said, And of just again, So solid years, that's quarter out than different because implies on guess, like we've frankly. the

reinvestments? about So about of one thought lot and was why of be these sort things talked people where at follow-up haven't conversations you forward. things do to I doing struck been some me got from that lot to people do the Day of perhaps you were like, going stand, my capabilities been Investor yet? well, of it my they let's the forward, get going was of the things a it's it, with on call to doing the able questions And investing a Because

that operating SG&A but on such million want reasonable thinking 'XX. that Is a to should it? get I you some ex-advertising in before and that it see -- of savings we now, like don't way where needs So call that to kind those even start that complete, reinvestment it about of of 'XX is level to $XXX be in leverage

Michael Hsu

-- but one, we've feel made in And mean, one, significant great I about progress. think and our -- I'll we're start, advertising. I Yes. Laura, we investments

we're think became points into came -- this I XXX I XXX since role. up to basis

However, our peer say probably relative I'd set. still we're underspent to

to Investor Day, And -- in I them would to right? know continue we we increase investment. have so like our don't think this do and need I But to I that said I match

asking, sessions would say, that we well, I wasn't that calls think of to our recall, like advertising we people point, hey, what was in some of, spend kind why harder, to I back did needed caused think to you there's going at on were had significantly. that capability didn't do, right phase you X we not may right? or And the you're I you feel kind invest confident had I XXXX, XXXX, some us recall all factors investment. I the reset exactly if in

I help of well in as aware. would kind And built think I of characterize commercial the so the last capability through X the world-class really on years, Alison we've front you're as what

And progress. We so made we've done that.

So that entirely particularly now. digital our one we're digital migrated having on higher factor to capability. advertising significantly maybe digital of or on we the lot returns are not ago was those returns And building our whole and and a being almost on driving now, XX right from were investment, we've years X than

So that's factor. one

more in years year of than profit inflation people I a factor, We super that operating more offset big full cycle. a than had other The think, that -- is cycle. had of we forget X

trying And margins as to so busy -- doing recover well. we were

lot geopolitical really issues And I well all so you're to well there's addition think the in know aware a of. going that I on

there's of So on. lot going a things

the making a in healthy so We're to term. direction. of the think of we're can top in where to to the both manage the continuing kind while business we And for our not invest bottom steps way but long line, right to the we healthy business in right deliver be, we kind line, want all way

Operator

coming Nick from Markets. Your from next is RBC question Capital Modi

Nik Modi

is outperformed the destocking context And pressure a your you obviously, been of or Just is has have if backdrop clarification, where to could quick terms results lot feedback seem that on it? broadly the the though just a you consumer of under actual you question provide speaking, today, the obviously, then commentary. saw in

health, and uncertainty, maybe your some everything guys thoughts because your you is love on seeing. So on of but would is consumer flowing love just Mike, to guide perspective not sense the health, what get kind are of part kind I that. category there through I'd of

Michael Hsu

and Great the Yes. first the quarter did we given expected, questions. reduction in a that. on as up heads see Yes, retail inventory were we

so And XXX global and XX about headwind an bps we sales. was to for planned America it it, point basis of North about

say capability. so don't more with December, think very in retailers, tend see typical. little trying tend like I January and I'd inventory think get much retailers time our unusual. the with And We they're efficient that frame, to behavior I efficient they it's to to carrying. is We how very, a be logistics

all to of kind kind we're so And of to manage systems try new that generally their on retailers early better. go of adopters the inventories

So top into lot expect what we're I outlook did but happen. full in -- in fact it's kind that of I whole expected know on going baked but of our for QX a don't it. we forward, It's been year, the different

earlier, think said stronger I I little had bit was anticipated. our a than we volume

more So fully than that. offset

Nick? first -- the your that enough was that think I on part. So inventory clear retail part, Is enough

Nik Modi

to was out, perspective Yes, can it on Mike, I just destock. out, call called I just that trying but was you specific because -- what a get categories Femcare that's T&G -- category any

Michael Hsu

in for every note, the what mind. just unusual across board. year. typical It's nothing our we see us for like No, to And

So one. part I that's think

overall characterize consumer growth I I resilient. the on globally, bifurcating, well. America, adding think bifurcating especially actually us Still your guess question would for consumer, but in category the to part I is that North of as but is environment

robust. the very demand So overall category very, remains

America. As you in see North could

about up were average, categories, X% digit. Our overall, on or mid-single

daily I essentials. as know, think -- you we that well make

there I is reflected category the so categories and And our demand. low overall so that's in think in substitution

Brazil. developed U.S., South emerging the is U.K., also robustly, but is continues very, markets in like markets like Nick, and premium especially note, very the it's developing Korea, grow like in growing premium in Importantly, to China,

to I we're said, income see That clearly, data so economic would middle demand are continuing look households all say, that based like they there. we're on stretched lower more all -- seeing. to becoming the And they're

we very household every tracker would category. have trade towels I the in in see limited a care, detailed but notably I So very, across categories, say some is adult few a bifurcation down a

vigilant at down dimensions. trade to we're the more the -- say tracking that. I'd but so consumers thing be really ladder. it limited X is intend our is of rung valuable think The like we about different every about we're better, to I point, And good, this best monitoring at very

our that us what was label we making over means we brands serve Depend board. like Anna products think that premiumizing, our think consumers line Kleenex about is mainline, too. certainly, I to driver or I quality. by better, want well, Scott, to categories. so products mean elevating all the private the we're But big And main of for And serves consumer Bath growth is value-oriented our too. asking those across value have And that term making the as the better and I well long

Operator

Your next Carey coming question Chris Fargo. from from Wells is

Christopher Carey

of follow-ups. Just couple a

So the numbers Just your think and guess you numbers strong both peers in Year, also way from in question on category well. is, turn the seeing we China delivered China, good in U.S., I number. just are New gaining a clearly, right? but as benefits China, relative I a share? quite are it's Chinese And the Clearly, one market good perhaps of

me a secondly, trying just And I'm like understand I it's interested relative expand the question And that bit to category. China I you've on comment, a U.S. but know out because deeper, can you this guess. really as outperformance So I'm to on well. more then same stood the the bit just more, in if there mentioned to and it

Michael Hsu

think a over the of the and best marketplace. product. digits leadership, our consistently become Day China. in -- with doing businesses job the would saw grown But on a product -- the I past in years, one Investor say there. fantastic a I Katie's And China is I'll a the of Yes. strong it's Again, it's of great presentation team factors. start kind the they've Chinese couple double the performance execution. we X if performing driver I our there's New Year best Certainly, -- overall, make company. our best believe you

excited consumers about with And really digital think we I have relationship that products then of offer. consumers. that kind are really we that drive strong really, the executions

rate it's about the consistent everything question, data share else on down still a to pickup. your more think itself The And the so based I birth quarter, category and the was I'm in seeing seeing. we're answer XX% trends of with

So in predicated, we're market point mid- out a, it's a at that's only And would share leader China I'll high-teens a we're this but to pickup. the point. share I say, at

we very good but about so And positions, it's our feel fragmented a category.

so And a the market. there's in growth drive to share for opportunity us lot of further

Importantly, to when line. of at picking hey, I be mainstream then we best tier want strategy, better, part want us, cascade we think and we're at end top I on the great of through accelerate every ladder, also every innovation our that to good, the or quickly for up And business. say, the run our

so that similarly the that. we're in seeing And sure China in we're and results And the U.S. in think for doing I

Christopher Carey

just if first this cycle. follow-up of be year this curve, back XXXX, show the then the to be the being the half moment on the are but is the a to going through of on work kind of could to pulps clearly, really one bit perhaps would ability the end I And more front It's move. in

prove feels and if actions on any durable you're manageable any types accelerate kind the Just you you if of these seeing Or even point? horizon? see moves very at that pricing, that and this potential productivity issues this between much and moves the the defer might margin on of to whether thoughts

Michael Hsu

with say, going me I'm Nelson. hey, would start manageable said, this normal. Well, want, point I disagree with new if here's you at to Nelson because could -- I

a that what some than the this us. normal slightly environment. it's a I'd it say, not different or becomes X But cost for deflationary. It's stable. a in I'd think still years That's us, more hey, the years would I past is, stable X for one characterize CPG hey, year At hope inflationary, deflationary. relatively but X or point, for first for last input X time is as the which

And good productivity so very us, plans. think I we have for

And through. can well productivity stable, so remain if and drop very, in costs input the cost very environment let cost that -- a we operate stable

there's then else in demand So that's And lot part. past the the think over been a I is, normal with part with -- volatility years. the everything one few of COVID other of and

starting to stabilize. we're think demand I see

can -- those so aware X in I of demand but we think But And factors, some about Nelson that well. we our different there operate cognizant and think for that, We're have are talk signals and changes, well accounted we around will pulp we're with environmental Nelson. very call. that we're current it,

Nelson Urdaneta

Sure.

Chris. on build what was Mike to saying, just So

year manageable. deflationary To to significant said, a But Obviously, still we've $XXX few to which with in full able situation That for see maneuver back see as we've talked other ago, million and situation things. input commodities, So like net downs. have X the we us. the to we maneuver ups shock and about in. X, well have through -- years said for for mean, in start we January, to when if through. built in what be talked I'll the years all as $XXX currency, a X costs costs is I we as included we we capabilities as reiterate, Mike we'd last over of us different the saw that order a million that's January,

in see back in tailwind. on in as full core the some materials, because manageable, pulp, of versus remain resin-based your for range, to of a said. energy range, upticks today we commodities we're unfavorable that more mind we still of were year, couple they terms, what dollar keep again, the numbers, seeing while high we're would now as January Now little like look they're the seeing bit a as staring A that which, at the you Mike at end things back

currency. a then use buying the that year. And of to see because currency headwind in manufacture to continue they hard pulp labor We logistics and in non-U.S. they're many for distribution, the obviously, and inputs operations, inflationary products be costs for will as the costs

keep So carry thing QX. pretty basis, phasing And And inflation QX the on is we trend we go given get the through as really year. of more of XXXX. much of see the cost also how the a outlook. all saw into before. year. input would the our QX there. follows this of muted it's we over net the that the in first uptick into our that that's be mind we'll to in half an and That The to in the difference we're half this of only we again, at back had that But more range is factored the And than high end expect we

Michael Hsu

just calibrate to Chris, Yes. you.

hundred when like of we're XXXX Nelson billion, impact, and $X.X million billion inflationary couple at and just on took to you $X.X think, in looking respectively. we of calibrate XXXX, I a

And is had in say kind then we've -- points other and Nelson that's totally why business manageable. predictable. we like the to different. some to scale why better The X So is than thing like And little have we become years we manage ways I try out, of we more it's would it's tools changed we ago more as so. the maybe feel how a that's reason feel one

Nelson Urdaneta

few productivity strong Totally. as a quarters. been I've a Mike's And mean, We're That on out X last very point initiatives. the and pipeline strong. remains build just to have tools, the looking pipeline of I chatting years about this on we for reminder,

getting to in on team year, would very to the in deliver, $X is You overall the of of so. non-procurement-related continue productivity and X in next in was very builds strong ability on our productivity the seen year, commitment the out or just not gross years X our following billion the this deliver but to that ability X, have years, which confident

into few built how and that's cost So the quarters. we're inflation next into looking for

Operator

next Deutsche is question from from coming Bank. Steve Powers Your

Stephen Robert Powers

if Two questions, could. I

kind the I'm better one a around we input and wondering sounds first year-to-date, it that X/X the latter for past, X-month, what the and and the maneuver know cost contracting year, lag. guess be how ways builds to typically reinflation flowing if of of cycles essentially with Kimberly-Clark. I'm pushed as of into different I that just sourcing through curious about we'd pushes to Does would effect, guess I better through current you've taken the this saw steps I'm commodities managing in The cost but kind maybe conversation have having third, year. of reinflation protect through has about cycle. better to it we we the as on and include in X-month out hedging about like that thinking curve and is out of visibility. X- like thinking now It 'XX. got you've that the much that fiscal just impacting Chris

Michael Hsu

one think of when Maybe earnings the is with they couple this volatility. analyst things. I One, me of one -- of the clear to that I'll I had the came into is community KMB Steve, say role a I the the and investor committee, issues think, made very

cognizant And that so I've been of fact. very

outside of Nelson, our pretty -- reduce we've, bring kinds so perspective worked underlying hard worked of of different worked kind some of over And thinking. the to volatility our an has into in with really past hard significant kind years, the business. X to some tools

about think and applying super there that in been with we've volatility Certainly, come down so good may History of would over last the there. further. And it's That we've down. comment it's what doing at would back have to right built elevated said, we're back and point, going at inherent one pulp, inflation certainly feel so the couple point come our that say business is of years Nelson, some cycle about in to some needs we very on think pulp, it you we that. I still tools. the And

Nelson Urdaneta

of I part that thing. last mean, as we and well integrated we've the approach, Price important. volatility. March cost promo drive elements margin total across Sure muscle addresses architectures, is chatted year growth so end-to-end work with on margins. of as the different or delivery looks to geographies we've back really been been the and tackle management XX, working for this kind cetera, do And And is in. for building important the the on we It build, we just it that, Steve, channels very as price that management, all it all including around we et do backs how which very revenue that's starts and have what at activity,

are that gotten us place costs. That's to do was muscle activities, And to walls. into that into the right give this within tools proactive visibility handle productivity elements at X the big we element, we of the costs $XXX of being the ago. into have through and we're we deliver it, And our then we We and difference Mike talked about split with productivity productivity accountability how and over costs. And into what structures that's net input drive we that or more in gives is with? have the the chain procurement, costs on time, the we've years have is the been -- or approaching now, hedging the react. on we very growth are We to which which supply contract least don't and building total manage but much revenue that's we've react how we were that X million and in margins. then that That's lower be across obviously about. clear visibility embedded drives it talking clearly this react do how a to Secondly, initiatives reveal And risk the on management. able time have productivity what management

different what in as it's visibility to we've we building react to said. the over the we say yes, the be today, commodities, X years, been is And ability So the past. not I'd obviously, to Mike we're had immune than in moves have muscle going but last

Stephen Robert Powers

Yes.

may already addressed answer you've to very That's helpful. Okay. short, I in you next if just tell the joined question me But the... And read be this apologize. go it, transcript I can the late. afterwards.

Michael Hsu

We , ] would rediverge never [ Steve.

Stephen Robert Powers

construction, mentioned on exit impacts did you prepared label those remarks, mention plans still of In to plans but are businesses. kind some it know private under I 'XX. some with the make you private of

would that great. you could you say anything If if -- that further on can be today,

Michael Hsu

Okay.

asked. that Steve, clear, be to not was Just question

question. great a it's So

yes, all to focusing with you that we science-based That big flag that, shared brands of did differentiating our was with on proprietary want let me the we kind I you Investor -- tell we're are innovation. theme at just on our that Just Day. strategically,

X% last production private Today, Just represented year, global give you some about our of context. sales. to label our

what takes competitive our I our so as of X we by that announced free, RM making diapers, I cut our and specifics, The advantage. into you core make our technology any won't will likely -- adult today parties XXXX. it think half that in we're is And that thing Also I'll forest the in care chunky development, decision, say what investments natural is as about but pretty would resides so take say some care. a to get end we say personal in to in care to The get that's all going new capital. science our in pads, all feminine to

choiceful really as to we And want investments where are be technology capital. so forward more so about we and we go making and that spend we capacity significant

that's could our some kind priorities. might that to label enable on strategic tech time. decisions of of over so see greater And going what to us exposure And private focus really note, to I decision-making. we decrease our underlying further as investment are our These

Nelson Urdaneta

X just in on supply in is we of line. to network strategy the our line with Day. within we chain would the transition, through the consistent chain of Steve, seeing and obviously, you're working X top And optimization that what our expect a opportunities what should context add be then, repurposing Investor standpoint, color which from we're at strategies bottom And related whole cost further it initiative, unveiled supply

say we more guidance go have into period. will as to XXXX We

Michael Hsu

more could X great. take be maybe would question, that If you

Operator

from Your is from Evercore. Javier next Escalante coming question

Javier Escalante Manzo

I kind guidance whether versus coming do have terms me to quick it's the like of first of what because like is incremental the question is clarification through a restructuring in context of sensitive in of the earlier. outside kind from to and it's Lauren's

and savings flagged, in are that month part if other or can million So mind? spoke of that basically, they address piece, the you ago $XXX you then billion $X of you the not, don't we the a

Nelson Urdaneta

$XXX said of that's years QX part X is year, million The chapter that Javier, savings of our it yes, element today. we're this part answer, disclosing in of procurement that. that is Yes. The of commitment started not there's that. and an the short then deliver We to new part. is And

are savings, so We perspective we're of a how that annually, tracking procurement, we including disclosing to get committed billion the entire you that the $X against to. committed

Javier Escalante Manzo

something in So it I that would October also thought I the be of -- that is XXXX. October, congratulations on the the start because new very early starting see organization

I realization from So true, guidance? remarks that prepared coming right, other savings is if at why it through the transcript is revenue is the that And thing get are is your earlier, all faster. that

savings you the billion from they're realizations have have ForEx, sizable, and right? You So revenue from $X faster coming coming restructuring. from right, faster

I needs So terms Is want the you we what want you to consensus to to the conservative, come be very you literally, down. balance the numbers that that take simple? year but understand of for in look if like, of

Michael Hsu

that the both remarks, start. the feel of questions lot right few say, just the our the about and world global there's But in year, geopolitical now, our really terms there's the as also, said, a just year. on in I'd out out demand. that you've in environment. uncertainty as still -- our cost start. this effects confident input Javier, have and We Nelson I'll we the in situation and remarks could on But of on last his prepared early heard good Well, still performance in hey, feel in pointed we're very

would drive Nelson? certainly, the strong start love encouraged to So to yes, call. on say, our taking and I year result our probably to by a would But to we're this a approach very year. prudent make

Nelson Urdaneta

linear. online of a point, Productivity we Mike's quickly category of when move on innovation trajectory We're will changes on of And you but build and to not estimate, timing as come delivery obviously, again, over our Javier, with got in realize through. things. margins just productivity the and mix, them get do And well country to pipeline how delivery. absolute they timing I can as focused, Yes. I an margin mean projects to time. mean couple quarter-to-quarter. is the benefits, have And have we

We're very We more if be still and how outlook back there, embedded have the the more invest we're we see it, the we're our coming which for encouraged XX lot our opportunities business a basis a activities balance And including by but investments very that's into points whole the year for year, going pipeline full have of to innovation strong of in way, started, and a money putting to we to accelerate business. stepping year. transformation going to at least in and we for up the the will. be

is of also all into taking the the which business, into sale which the take we've consideration half we're forecast, and for second balance a the $X.XX of headwind of our So account of PPE built into that of year. about the

Christopher Jakubik

Great. today. joining Well, thank you, for us everyone,

For those myself of questions, available have for you and will who follow-ups. [indiscernible] be certainly follow-up

thanks look you and we again, seeing going So forward to forward.

Operator

this Thank you. concludes Everyone, today's event.

may at day. and participation. a Thank your have time, wonderful this for disconnect You you

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