TRMB - Earnings call transcript Q2 2024

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Operator

Thank you for standing by, and welcome to the Trimble Second Quarter 2024 Financial Results Conference Call. [Operator Instructions]

I would now like to turn the call over to Rob Painter, Trimble President and CEO. Please go ahead.

Robert Painter

Welcome, everyone.

our that available safe you the started, and our harbor get back. ask we refer I presentation on is website, at Before to the

comparisons, performance commentary last of otherwise including reflect financial unless to non-GAAP Our organic corresponding will year, growth which noted. period refer the metrics,

an addition, In on P&L excludes which will commentary basis, our our comparables emphasize as-adjusted agriculture business.

on Slide X. start Let's

industry we Scale the quarter, second platforms. continued and targeted strategy, workflows involves the our technology & to across During Connect scale connecting which digitally within shared Trimble segments creating advance through

Our and focused to strategy convey the strategy delivers execution the outcomes X to in value organization. to the simplified today: execution form messages is of reflects our working, our unique and our value key want the customers shareholders. numbers and We creation the sustainable reflect

year X detail Slides the cash on were revenue, solid services our year. driven expanded records XX% ARR XX% and to Based $X.XX grew Gross and billion quarter record ARR XX.X%, Revenue metrics. XX XX.X%. of highlight overall margins Revenue grew in both EBITDA recurring we was performance, margin shift our transformation strong. X%. raising points a guidance recurring mix for growth. and for portfolio Trimble, half continued software first are X XX%. was organic some by basis flow and reflecting the free the

from procedures of me prepared comprehensiveness segments, of a financial turn PCAOB around especially reaudit concerns relating systems. the more an to These we of financials financial for using audit. audit approach. XXXX EY reminder, Before Trimble. a arose detailed inspection as the of of internal for and let on statements EY number audit additional XXXX provide April, substantive In IT our began our our a way their need the our about of the the of of stemmed By performance update documentation status our to concerns EY's controls,

of results are substantial EY's we for which is XXXX. have have up of and on information annual XX-Q what we XXXX audit work issues our work a To When identified anticipate them result quarter financial reissue provided a second expect will EY's collaboratively We would for the statements. same the completion, month the within work it change so. wrap working our complete, file first or nearing we the with not of has will need. majority we as be the date, any in is and the with to next and financial EY and they reported. report that date, the Forms previously Based to

terrific to a a AECO of Scale get the our spear of with & business starting record segment. on our and quarter of the XX% segment X working. our the is ARR growth. another of of strategy, Let's level strategy review with The AECO ARR Slide The back with Connect delivered results, team is segment the tip

innovative and revenue with through our are offering. platform higher We integrated products customer per our and customer succeeding growing count driving

design. The and A represents architecture

an example scan subscribers, that workflows of by The engineering. Trimble million strategy fabrication represents amazing E of deliver only X the surpassed product such can An form BIM unique milestone here SketchUp work our Here, the in at as workflows. and delivered comes the team. to

The construction. represents C

uniquely of capabilities. management public May, both private owners, connects launched solutions asset that additional us construction our buy they cycle field fast Unity, the time-to-value user Trimble that land-and-expand Trimble acquisitions management we tuck-in of held customers recent and we on and represents solutions top that plays we repeatable O can our sector. deliver run system. in payment of Here, Cleveland have shown The capabilities our suite conference a In where when a life

namely environment, AECO into the these more operate the hits over Across personas, API and XX of Connect billion projects platform XXXX. X data we has just had inception common than X since now initiated and Trimble in connected million Connect. first a months

go-to-market account model up and enable now to year, our this we named to marketing better digital selling the the sales are we a team earlier side, On efforts lining moved motions. our

the conclusion, the we Connect and made have Scale In investments & enabled grow gain several us share. over have years last to

which recently we ensure already on for XX strong billion Chief our Officer a our business Revenue enable we is $X.XX with our further resonates scale bookings strategy continuing. performance, hired solid of operating our growth this Our that well quarter success second business, customers pipeline above for momentum believe and our this ARR in Rule will looking and help at ROIs. and benchmark. Based We see results, a

The the strength of physical prior X. largely on was Systems with is in reporting highlights Field our to expected, conveyed our key Revenue as side business segment of government-related primarily down Slide related sales. year

well perform channel end-market product While been and in have areas, with we some conditions positions. continue strong to soft

evident of the than than this Field $XXX more Nowhere Systems million in ARR. is more

delivering The been great models our to the doing of to growth market, offerings unique to value has deliver we the ARR strong and This matching software have where nearly and relevant addressable leverage hardware motion job in product AECO. customers. team ability evidenced has our XX% expanded a as converting market growth, by position

in team and through examples, control this machine Plus Works starting record a which as a our bookings. delivered of offering guidance construction, quarter offers service. X illustrate civil will with I The

design signals to Services expanded to geospatial agriculture OEMs. the classic offer our delivered markets. and our globally automotive The unique in high-accuracy and ability markets business into automotive ubiquitous major Second, has from quarter our X Positioning wins team

to basis, with costs, world. unique solutions. the positioning lowering expands most we act collection us premium ability services configurations, RXXX connect quarter physical this Strategically survey and provide the on solutions a Trimble our adopt the digital data which node available a in third, speaking, addressable to as the segment sell the launched of physical in field instrument we world market subscription the firmware software enabling in to by the customers GNSS and more And upfront

double-digit Closing Transportation growth, ARR our Logistics & Slide MAPS segment did Transporeon on our and expectations. as our commentary top delivered bottom X, beat business. line

business, the America Excluding was organic XX%. segment ARR growth North this in mobility

our years anticipated, last that has it and Trimble a business displacement. the the largest X/X the noting the competitive in few we is bookings upgrade worth in team the While with quarter, mobility churn experienced technology delivered which a was X/X

are and new Our the solutions. buzz is we generating video Instinct good selling platform success in positive market, having

market all recessionary conferences our our Transporeon at user innovate the new September. some freight a in in on solutions, continued to continue unveiled be the in environment, business to While and will of we logos our win remains quarter, which

visibility one are of Trimble rationalization team by path consolidating we the on down marketplace between into evidenced businesses, addition, In as moving freight work the product and and each. Transporeon our

began basis a into the mapping point also increase. base. solid selling delivered We Transporeon The operating customer income, these XXX our sum solutions of XX.X% activities

call to Microsoft colleagues Phil using us as X,XXX to Azure Trimble with we of the over on usage, numbers, offer handing than more our version we to of GitHub Assistant. winner. Before own an see over walk an OpenAI Trimble more internal Starting Trimble I using internal Copilot want perspective AI we that through engineers X,XXX and have why a now

of of capabilities estimating the and engines. and production we PDF a into beta areas. releases AECO, we into of logs number a in data In From customer-facing AI extraction have submittal perspective, automate

the included We renderings. We've from shippers Field hyperlinks. our feature In slides, match include on we systems and also XD complete several that BIM of of appendix AI autonomous procurement customer cloud. into in In AI carriers. photorealistic point with models Trimble Systems, transformed transportation, with focus XD solutions quotation support, extraction autonomous examples the

Our thousands includes losers. our transactions capital and continue of over that the the running physical around instruments $X programs, thesis scale machines we on that systems, of customers of of right to business. and of is a insight domain-specific the separate freight moat win have data trillion of in of AI will winners a we our compelling millions defensible world, AI global building tens believe and of unique billions through our to density and dollars With and construction hundreds

Phil?

Phil Sawarynski

Rob. you, Thank

As drives margin emphasize which value. & an deliver to recurring our continue Scale and, financial basis, excludes believe We we strategy, flow maximizing our cumulative ultimately, believe is commentary as-adjusted that expansion comparables will shareholder revenue growth, noted agriculture business. will Connect long-term flow cash growth. before, my on which free cash

cash million. million on the That from sheet highlights and transaction trending to flow, well as balance considering $XX we dynamics. of after payments was related the cash of in expenses. transaction-related sale flow On gain are Ag XXXX flow better Slide as JV Reported impacts. million $XX the XX $XXX M&A-related first half includes cash our than expected tax free in

of target without above Xx income. first the in items ratio well conversion half XXXX our was these of net Our

gain We and the second additional related the XXXX are will on our spread sale quarter cash tax and fourth since third in XXXX payments time. tax operating JV payments have flow to quarters over of future out impacting of Ag

asset-light with capital negative Our X% revenue of working than less expenditures net continues and capital. model

close well after target our of than JV Ag less long-term X.Xx. stands Net below the the EBITDA debt of to Xx, leverage at

credit the We term balances our have practical. share buyback debt facilities. on after We to cash in our and intend when just under our outstanding resume paying $X down billion

the Our the we capital for invest same: remains highest returns. focus see opportunities we where allocation

to are operating the to drive to continue AECO capital increases ARR, growth business ultimately, continue disproportionately engines where allocate in sales and, We our to margin marketing our our bulk expansion. and of revenue expense

with bundled the strategy expect our that a acquisitions, delivering that forward. are put XXXX, in On sellers. our by quarter acquired been pursue also These integrated tuck-in offering both, Scale critical & the This One. integrate to we deal playbook is a hands quickly as a resources in the of offerings going recently is our Viewpoint. part for front, are models. in well where Construction results human within AECO of of application opportunities Trimble And in Pay the strategy field primarily and excess we can product growth branded acquired a our M&A opportunistically via and that and we Trimble acquisition enabled We we has bundle seeing segment payments is Connect third bookings we of

that, the year. to XX talk Slide for and let's turn With about of remainder guidance the

X, by fiscal revenue quarter of which the January of a approximately $XX XXrd operating license of adds have $XX falls renewals which fourth million in XXXX, this and in driven week We on income, mainly term year. million

the as-reported revenue to $X.XX overcomes also million We guidance midpoint by our headwinds. currency billion which of foreign billion, full year from $XX are $X.XX increasing

$X.XX. are per by earnings prior We to $X.XX increasing full from the also the $X.XX year share midpoint

slightly high-teens performance Transportation and slightly, in is to largely due mid- to XX% ARR half growth quarters. AECO from mobility is better primarily disclosed than and prior We our is previously prior American in by to unchanged. the the first the strong the our of in churn down revenue range bookings AECO, North driven growth offset Field strong revenue XX%, our guide expectation transportation Systems maintain business. by

noted the EBITDA above conversion year which income, would Our be M&A be the in XX.X%. is tax expected income as approximately includes approximately year for well for year million these the I updated costs. from million JV anticipated between to flow earlier net an margin we is our prior the for full Xx on improvement year Without from guide. net as $XXX cash of gain and XX.X% be $XX X.XXx items, to Free and

our to as-adjusted consistent with prior guide. move on guidance view, XX, Slide which is agriculture. on focus quarter I'll our our excluding third again Let's

remains growth growth for mobility with to ARR transportation earlier. despite XX% for outlook continued I Our North organic mentioned American headwind the strong XX% expectations

second revenue XXXX. to the our as-adjusted due quarter, in basis, relative is range On to to Our is million. anticipated to revenue grow second flat projected the showing of up mainly in to government $XXX the sales million $XXX company is X% and year-over-year total an strong of be to improvement quarter

Non-GAAP is to be the the of to in XX% of expected third in the EBITDA XX.X% XX.X% operating to range quarter. range adjusted margin for and margin XX%

is, of with again, the which our prior in range consistent guide. is forecast to $X.XX $X.XX, EPS Our

readily in available to supplement provide materials on of I our This with that is behind our would included format. a model guidance our out point a Investor our assumptions website. to that we new summary also results, Relations along in like available is a

item turning back more mention I'd like over Rob. to One before to it

September in refer context, about the numbers model to we multiyear think from our a Day As I Investor XXXX. financial

for this Our midpoint the revenue would of above X% X% with the long-term extra year in higher-growth XXXX, shift Normalizing range are the grow that the we range. target of projected believe continued in the fiscal software, organically. model to we benefit to biased week

of range to We in leverage XX%. XX% had forecasted operating the also

Given annually. the above mix shift margins we Thus, to high margins, forward at range. gross or of the end see details potential to in the December long-range would plan we range the more to our or and leverage with XX. at higher XXX to this look financial forward software Day update City be of operating operating expect Investor expand going on an York basis our We points on providing in more New

it turn over you. I'll Rob, back to

Robert Painter

to and partners all of we and for the can transform delivering our works. resilience how we colleagues we a as conviction world first solid year thank to you Thanks, and Phil, transform the for that how Trimble demonstrating and continue work so half

in with the to end a I'll Paris. games fun fact related

stadium Gradins stadiums, athletic for building after and conclude. Les leveraged athletes, converted office as Our of technology center, and building, XXX over The sailing football many for which will the also be marina, the games the the of such to the engineering aquatic is houses housing. the design, an construction

project, used hundreds platform structure the on project, prefabrication time. manager Connect engineering it and technologies coordinate the and construct terms across users and the On on best market Trimble the to as a to survey bio-quality to on collaboration platform to in To Trimble used the and kit, find be of BIM usability. engineering of quote deliver our a Connect stakeholders. collaboration were was sustainable "I

tool can for to be the they nonexperts." Operator, questions. line open let's the You to tell use, design even to easy

Operator

comes [Operator Instructions] question first Owen Kristen The of from Oppenheimer.

Kristen Owen

to expectations. nice clearly AECO the ask the XX% ARR, our wanted Congratulations of on ahead quarter. I about

And it you some guidance lifted compete, the as look for of there. there's that when maybe Trimble pick and You in across pricing up an think of categories which seems software to I the me we've you seen. like some about channel landscape to share the shifts opportunity

logos, the would be et it I'm sources Any Is if helpful. cetera? cross-sell, you price, color there can growth there. us just new that help you unpack additional wondering So can of upsell, provide

Robert Painter

Kristen, the Thanks, question. for

little ARR post really a of terrific from from down It congrats break number with let's the X/X About starting within a like So is growth quarter. existing X/X new that growth, a coming team. customers of the and bit to the logos. the there was for

really Construction over have we offerings form we the we us the And and depth -- portfolio specific ability offering and And industry a where continuum. in the so of serve there's breadth for the across comes the have, package, to cross-sell great to Trimble One upsell. prepackaged of personas now that XX

onshoring If are work, where have look and within strongest. probably actually have some strong have These segments that data at we markets centers. been in residential. the serving work. we're see renewable data growth We in construction, we reshoring of see been the centers had the growth energy We also and end strong

seen growth though even So weakness there's we've there. there,

a is about of through lot over ERP the One through we thing programs Kristen, too, we're that's data managing construction unique because can see. there's the over committed alone, that trillion we $X.X trillion our set have, of systems, $X data

is up. are that And we that We North America, see can up. are the jobs are as so up can volumes up. Hiring jobs that see in

that U.S. can We states strong. strengths South geographic can been have York Florida, Louisiana can We like here see the states within see Texas weaker. We been states in and have New like Carolina, very see

sure, for into Europe to North good insight then Asia across able get differentially and the is we're America, world, So than better the market. a And performing Pacific.

some you color. gives that hope I So

Kristen Owen

AI. follow-up we've my first And real here, the have conversation Trimble heard is this about

or the look has how one back You're examples seen in monetization So questions understand creation and the the that we've Just do that utilization procurement? which you giving or you whether it's on into. AI to But the value some Trimble of can the us for understand the us we'll have or autonomous been, opportunity back, help of market monetize at Copilot help in it? the go technology. leveraging

Robert Painter

attention Yes, great monetization. still it's to lot the Kristen. paying in early of question, of a very We're a innings it. We're

work, Copilot GitHub the internal about talked productivity. you Now that's

how lens how productive house. in of do us customer I development. own doing support for set more we're chatbots. we code our the have It's work inside sharper and a getting could AI. is efforts, AI that's making It be the using So this productivity our marketing through leveraging is about That there's the efficient the on

that. oriented, doing go are had of sort in remarks, that delivery it paying a to put then those typically breakdowns and so increases We is you we they're is in customer When what hyperlink examples in you X we this our see One we of some on appendix as more the I is value prepared subscriptions. look we're part get some customers, of give -- and year. the price go can continuous the slide I'd with examples of the at that some every market,

in The more I provide that think sense, okay, we're that can make reasonable of offering there's it's share fair we or distinction what's value the and that productivity have our we that is part would about, the what's that breakthrough value. And capture. customers, expectation providing incremental think a do. we then breakthrough quantifying when that of -- we I value

And One to for execution used developed used within traditional better of example much the that methods that they've developed autonomous using is autonomous Xx result point is they've Transporeon, monetizing and look, the I to the X solutions Xx team for when our it's instead at, business capabilities. probably because we're think, I -- customer. is procurement and quotation the that can -- out at customers factor Transporeon within in are has

monetization the side still monetizing, where that example say -- I'd evolving is pretty right you're and one of early And it. this in in we're we're that's So of of certainly things.

Operator

Capital line Celino comes question from the of Markets. next KeyBanc Jason of Your

Zane Meehan

Celino for Jason This is one morning. first this on for Rob, you. Zane Meehan

curious you're delaying if guidance. full if year U.S. hear that. and the year, this that's if any up in just so, the election the as a hearing later in result of to buying decisions With coming And customers XQ contemplated

Robert Painter

question. which that the way We believe we've to into the account people blows. in do Relative in wind pause the a the see will we'll wind for put Thanks of taken to of see a way to typically bit that we've guide mean, hear the election, forward. these is And which periods you I that going blow. kind that

much think manifests with guide, if business is you burn. the visibility than and higher hardware have which have say, would the business, about the book about the more as a we ARR on, And think let's we

we into differential XX% of and visibility have a company, our of recurring our recurring. the of So a as the rest overall year, software is visibility. services revenue as XX% now revenue

got -- on certainly all It's whether think But our depending tariffs, be around us I way and whether of that's taken or that's impact to around what election guess, believe into the the regulation we've reasonable might to us, this this on for of account. about we goes. which business,

Zane Meehan

Okay. for Great. That's question, Phil, you. second helpful. super And then

uptick side, see On the to the margin guide. nice it's a in little

the Just further hear Or curious, getting you leverage item? are uptick. revenue is specific the coming from to curious info margin more a on line outperformance? Just from that

Phil Sawarynski

a first Yes. our at Thanks, Zane. a The had really grow the start Systems. than the bookings rate main as reason And for those we continues and mix in shift little to to bit it Field half. through flow better the half, business second AECO faster is

then business the AECO higher the margin mix on Field you're gross that Systems. obviously is I so think the is And which shift, what seeing than

back in through flow of sort that half seeing of year. you're so the the And

Operator

Your Goldman next the comes Sachs. of Jerry question Revich from line of

Jerry Revich

logo the more expand have visibility expand about you quarter quarter? cadence that? in the Can the was growth for was how What just the that just in growth into count? the the the you on performance What on and business, and hear extent August to Transporeon. on to transaction logo nice at July looked Can Rob, the you please?

Robert Painter

Sure.

X secondarily, quarter. this with second the Let me of in ways: frame first the year and then, half one, the with

first in to mid the in the the business Transporeon Specifically was for the of growth the year, high bookings teens. half

still of in what So recession. a super with pleased context that performance is freight

strength over And in deals. the XXX coming the can then you the the landing through Those form winning new bookings, so of and stronger dozens come within of retail plays that logos second it's in markets are deals And doing quarter, way deals. of team grow that There been won and weaker. land-and-expand side. certainly existing some also the base. some There's others the coming back are are that end on pockets customer

North -- of the the America of for pleased have that which well, been business were by. some building traction the materials getting side also business. success in had has lower The Some we team as here

then And together. the Still between early comment is I Transportation in we've I'll business. happening teams Trimble plays on Transporeon of and in thing what more that, the like but working got seeing terms I'm last

numbers. add up the around that's So color that the and

Jerry Revich

consistently Super. XX%, growth Viewpoint. And that opportunity that we're been business on level for seeing logo put growth much can continue and this you And and I this really now? is now? can consistent growth acquired on, the pipeline e-Builder runway the how since I ask year do the a for AECO? But around deliver X similar you've of unpack question versus think, profile based see you've you XX%, to mean growing set has I years about much pretty that cross-selling? to How

Robert Painter

Sure, Jerry.

X/X this $X.XX consistently alone XX business ARR was been the logo operating scale. you're is of the XX the business. growing growth. And a new has team today, mean XXX% the X/X excellent existing a a Rule and in is retention first I So ARR the quarter. high in right, of is at customers. teens, posting It Rule growth customers quarter. at Net in billion is growth in at the And about from about from AECO in excellent

So things the of a in lot good business. happening

TCX abilities. a with where have doing value customers for It our higher-order have that's process. with the sustainability and solve available -- in helping them customers the can connecting the when productivity, Trimble proposition, safety, that work do winning and work It's at have uniquely Trimble unique is field the We proposition customers. Especially we believe to Construction easier office. in we're quality, a It's in we environmental One, because business we delivering things makes the for friction value buying offerings that us. to you it do it problems reduces

So look being we growing from when our customers. the X/X-X/X this when bullish split we're to have, that that look base ability at existing the we of business, customers X/X especially at in continue and I

Operator

the question Ho comes Jonathan of Blair. from next William of line The

Jonathan Ho

Just wanted to Connect, faster named a go-to-market if Trimble additional give see help executives us and you could that of the that on changes platform? making the us maybe understand color how little account you're adoption around for of Trimble bit drive could potentially the

Robert Painter

that So the -- ago, given accountability AECO -- her have named to behind huge multiple the that to serve moved who's at in accountability yes, if selling bring you beginning XX the That for in moves customer business, got and it, to think And the we model best definitely to the then in going specialists sellers change breadth a or we call team years X, and in the about might if having and that you account sent we meet for person one customer. was rewind, of if him needs. talk account year. to to of to organization. it, you're for the moved a Today, a order

namely, what's the then unique And those arms the you product processes to proposition. the executives behind model, where incomplete a that with one to account be go have named that offer with value have that's and systems. it. Now it's thing Construction And didn't One underlying if to the are customers bundled ability along TC, offerings would Trimble account

game which Then enable in more do at that all engines do XXX-degree these operations, let's say, investment terms systems our has, lot had we've enablement -- sellers helps we've to entitlement -- I'd our our upped And of, views say, over So as growth customers, and underneath we've go the that, around the an helps sales with work which example. what our motions. they a account of years the the licensing of level. of sales and named made we're last getting then

Jonathan Ho

or Got understand, contractual then perspective? like from little you works that give are through in it. or and can financial base? a type cross-sell us Trimble opportunity of looks that the maybe gross And payments to contracts color and terms just these your want a how bit follow-up, on Pay what more opportunity Just or net a

Robert Painter

Yes.

So we're the bullish offering. we're on platform within that land-and-expand plays

So And acquisitions that have, we can motion. payments. work the when in as of we've existing and remarks base we we well with and prepared a think that to seen X in field and mentioned that winning Phil as about capabilities solutions both the attach that's the new the customers I

stands we the payments And business. ERP. to an to that the link are going to through It reason what, have guess ERP Viewpoint

So that's the proposition value essential, let's or essential linkage. call it,

the able winning We to place project the is management a subcontractors a systems, be with the motion. also have need in pay given think to a industry to natural we for us be and

you else anything there to want that? to add is Phil,

Phil Sawarynski

good. pretty that's No,

Operator

Baird. comes question of of the from Rob line Mason next The

Robert Mason

I quarter. seeing wanted what the the you're if more during see and if anything color across a little regions regions get just your could to changed geographic I in various

see overall the seeing you're movement. though, in what Your that second outlook, year some regions? lot of of the a just how revenue of half didn't can have well we is. the I'm as curious, outlook, It

Robert Painter

it's organic most quarter. North a around in the hardest it's Yes, up we've Transporeon, strength on going Transporeon but business. America. seen the Europe just Actually, in Differentially Asia Europe, tougher basis. in was be from Pacific been baseline. us holding the a grew Ex for still an world, market to the That's on

expensive China couple Japan, and harder what's it of and do us, business. of for say be paying attention We're to places, a of business makes continues yen a to to been economy And have of those a In the to the do with us there. place of think the state weakness. I'd more Zealand, weakness couple New in the pockets happening of Australia

North plays half America, year. that our into the strongest. in Pacific, of thinking Those Asia and the the second bookends, weaker; So the are the

Robert Mason

Very good. automotive wins. Rob, OEM you made note of some of the

bring was I'm We of with up you where us that could part are in historically, know on a of that there business business? the how you of positioning the now? I involvement in OEMs And GM. overall business sits just with some about book bit. part your date haven't working many talked to --

Robert Painter

good Rob. question, Yes,

talk us technology let's construction we itself. deliver agriculture started innovate over survey, of technologies, high-accuracy We global years. the those fast ago, to create about more have deliver that now markets. and and -- moved you ubiquitous continuously positioning of coverage the history, now which called in what's can continued you from for need, We RTK technologies -- accurate can decades I we deliver highly get got corrections those mean satellite, positioning for underlying to positioning ubiquity the evolve convergence in So our as been go XX-plus which had into back that. for same through so that historically year

we the markets a would asked signals were ourselves natural would Automotive for these -- of high this then high where convergence, extension else question accuracy be And value? us. of

on So positioning that's the let's the same autonomy to technology a sensors, systems into in path for redundancy whether say, ADAS segment, the other or or market cars. new or technologies on to

that technologies. history do we that the the automotive automotive market market. And that's for and -- we extending market and navigation have some the had for in context through it So is -- a technology into

same today When that. that it get we the pipeline mentioned you to additional probably the bigger the OEMs. topic Super have certainly Cruise that design than it's take General time exactly yes, it's to there's you than at that's -- talking a long less we're design with a think Now believe you program, with. that about win, design then can And Motors win. I dozen wins a about

would you've win. minus Once very you a plus call years very pretty design it actually, got over that multiyear, say actually, a have cycle, life I win, long -- life X long cycle, well, design the or

if you apply and -- be So of software to value business win think lens you you metrics of it cost, in kind it's can some and a our OEM. once customer lifetime that good acquisition of a to about

Robert Mason

they design quickly could the convert do revenue? expect would in ask, your I you If when if wins to revenue? quarter, how So

Robert Painter

recognize being that can to it's revenue; revenue. it's to news slow mean over the news: slow get we of that and period news that to good revenue actually time. a It's is bad to I very long very get recognize good bad news

with date, So design more been margin. revenue than getting it's and wins, years, over we've last few I'd say associated as to had these costs it gross these

years. for So upside-down it's few been a

we a to recognize revenue. steps base over a it the just as that cumulative of base years few will We're up. will -- start cumulative as that getting And it to point look better next

good little XX% would also that's kind it's revenue I Systems And have in had the multiple Field fundamental yet that's has growing that's in forward have segment, say, So but over of nature visibility we recognition thing years. ARR Systems of historically. that the That a Field news the automotive is, we not the bit growth can of years never it. would that

Operator

JPMorgan. Your Tami of next line Zakaria the comes from of question

Tami Zakaria

first so Transportation And segment. the the is question on

I think the year-over-year. performance given compare was quite the impressive tougher

So when it's nicely, pretty I to up look X% year-over-year. X% at the performance, first half

expecting you're so your So some means guide X which single-digit slowdown. the full for year, -- growth sequentially, implies low to flat

third to think in segment? comp? we of softening Transportation year-over-year understand are half the trying terms in about Should Logistics sequential first to think about demand? the you slowdown tougher back So & just this how half versus the expecting any the Or for quarter

Phil Sawarynski

question. for Thanks Tami, it's the Phil.

mentioned in about the some to the and that manifest remarks, business, I starts -- that in really prepared we've So American already the mobility we've this half. had but churn in itself talked second my North

second seeing is still a previously that due disclosed. business, is the half Rob that. you we're churn But the that performance portion some really in the business, see as around of we drop So that see MAPS the that's big that the of headwind half the offsetting earlier, you second that. to said But really that's Transporeon

Tami Zakaria

next continue some year Or other expect So update well? Got mostly I would should you any do question process? through we journey rest you are as investments it. on helpful. investment the And spoke in Is of sales incremental expect color then think you year? that to of continue is, marketing And through it done? to the this that on Any businesses. support in the software-centric making more the to it and you're be where importantly,

Phil Sawarynski

Yes. it's again. Tami, Phil

drives to allocation in our this so ultimately resources a we we and about from ARR future. the which business the and the particular, AECO as yes, standpoint, marketing, in talked sales pivot the So growth toward that and, capital continue growth revenue

as bookings. pipeline continuing that we we the the have so as long And see and

think And if there Rule-of-XX-plus resources to we opportunities continue business that allocate you'll in toward easily the business, kind of long I us slowdowns, as and a to maintain pivot is there see growth thing the as see see continue the nice about a do XX. we still OpEx and our our Rule we of that. But

Operator

Research. question of final line the take Wolfe from Joshua of We'll the Tilton

Arsenije Matovic

Josh. you're facing suite the that demand more Certain impacting you on products improving appears growth, really this your in win contribution from demand And versus directionally, you competitors Or stakeholders, you maybe talk it changing X/X new starting is business. isn't are into driven seeing what behavior And This by for you deeper, of a a but to perspective AECO are are competitors? wide across challenges. logo space than Arsenije existing just with I portfolio? the layer saw Can know this of seeing your seeing is customers? different you sell in rates a year?

providing then revenue load in think, Europe I with, rates the getting and is Transporeon per spot contract, And on embedded that spot business so, full in if quarter-over-quarter guidance tailwind the versus more Transporeon in this your And year? a into improving just release? is

Robert Painter

Robert. with I'll questions. topic. the start AECO is this -- I'll with Thanks start for the

So new X/X-X/X the we ARR the logo. from have the versus growth, split coming talked about yes, cross-sell

call customer the a market, where segmenting engineers, companies think also terms the, designers, lot end infrastructure. of the I'll architects segmentation in size markets, residential, we additional the color the we as types. serve and It's a think could on the customer. segmentation follows: also the nonresidential, about can that's whether of construction time the We I the the of level add There's of and owners, there. on be spend I it, question your it to is the their

customers the think small- enterprise mid-market about large medium-sized customers, and So think businesses. about and about then, lower down, think

our a One here and customers. small- America. able pivot pivoted we've North midsized teams market the been into little on is the weakness and the we've in to where business of medium-sized motions bit where more our We areas seen

go got the and the one And I the it we've us. data model -- products think what So about the find of the and that's differential and to is. aligned the business ability where go-to-market things that's

serving peers being down a the broader the serving industry able So our the or and ecosystem, on that, our depending up than motions have to serving then of taking where is move product we globally more in broader market, in activity it more participants offering, more place.

decades XX% we've have a bookings channel. We've channel. also our channel of If our the through came to in managing a the at Trimble. Trimble's got We mean, quarter business, probably look in had Trimble. of AECO I XX% we history,

motion long also that's So time. a had that we've a for

asked to and needle on to you better. They you're continue we then at attention spot side, I really to the are, Transporeon pay as that. say, moving rates would just yet. we'll well, Europe. enough And that, look be better marginally They're not about to in right But the do

for market then are So that would If be move up, were built us. the guide. we into go and quicker rates that spot the to rates upside believe current our

Operator

today's Thank gentlemen, for call. that you. and Ladies Thank joining. all you concludes

disconnect. may now You

Trimble (TRMB) 6 Aug 242024 Q2 Earnings call transcript