Earnings call transcript Q2 2023

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to this morning's Belden Reports Second Quarter 2023 Results Conference Call.

Just a reminder, this call is being recoded, and at this time you are in a listen only mode. But later, we will conduct a question-and-answer session. [Operator Instructions].

I would now like to turn the call over to VP of Investor Relations Mr. Reddington. Aaron sir. ahead, go Please

Aaron Reddington

Chand you. Good us Call. you joining CEO and me CFO President Jeremy Parks. morning, Belden’s second everyone, Ashish and for President Conference are thank Senior quarter Vice today and for Belden’s Thank and XXXX With Earnings

will strategic followed results, our by overview Ashish business, will Jeremy operating then provide financial detailed a and a provide review of and of our Q&A.

will slide reference earlier this this morning, we presentation our that release, issued a we are currently press of earnings release The investor.belden.com. available We transcript online these on remarks have call. and and at prepared presentation, prepared

Turning to Slide X in presentation. the

During this certain forward-looking management make statements. will call,

press For most and our report more review recent information, today's release on please annual Form XX-K.

will In the information financial management of a appendix or during the relations the the G, contains closely today’s accordance financial information Regulation our of associated reference information. to presentation to and reconciliation non-GAAP communicate. most section financial investor call non-GAAP we adjusted website with our Additionally, GAAP

now the CEO to Chand. over Ashish turn call our and President will I

Ashish Chand

morning Thank Thank and good today. everyone. you, us you for Aaron joining

Let’s quarter accomplishments XXXX. the Slide in we the second turn of major achieved X for a to of summary

adjusted As a I’ll results be today. to reminder, referring

another First, XXth exceeding expectations total quarter outstanding once for in team again revenues our delivered the with quarter, and EPS a row.

for quarter. came the high at the in end grew, revenue growth previously and margins our issued our organic Our guidance our expanded, of

the expanded solid per basis EBITDA achieved from XXX we quarter. of margins quarter, second revenue for we well Belden $XXX team, execution to record the quarterly our XX.X% Very points done. the share During of million, $X.XX, and record earnings by

regions. businesses across broad-based was quarter the our and in Growth

growth, products value-added transform margins, are supplier increasing of provider, to resilient and improved results, As Belden we from and customer deeper a more continues partnerships. a to seeing the solutions trusted

of our was well challenges today’s do both margins segments in uncertainties the expanding to Second, to revenue growth environment. world. and our products solutions continue around our positive demand healthy, for with and the the segments for considering tough with perform End quarter, experiencing

helped Sound Solutions, growth and the growth organic company-wide, in business organic execution X% in across us X% Enterprise Industrial growth organic Solutions. Automation X% achieve

our as in capital high-return invest year with at ago. levels Belden towards at leverage opportunities, and grow, low our continues we remains Finally, line to business X.Xx, a

Our ample Combined flexibility current low significant strategic leverage, have to X.Xx. plans sheet balance whilst execute of is our strong our below liquidity. with with staying net we leverage target net

the well was cash year-over-year Free to track cash achieve twelve-month previously flow articulated. trailing on the our for targets and $XXX reached up quarter we million, free flow

continued in that to the and I am During invested quarter we pleased deploy M&A $XXX have we million report repurchases. capital, share and year-to-date to

years continues In and the was and sustainable, past. of produce few summary, the another the margin higher undergone highlight excellent to Belden to quarter last more has over business our this than growing, a business change for Belden the

turn please early in to Slide its Now X. still is transformation. innings the solutions of Belden

can strategy. position building address customer challenges, few years, are solutions focusing framing a we case around KPIs marketplace. created we in new business and Over their By go-to-market purposefully the incremental and last the on our how a have unique we

come customers Let actionable opportunity believe positioned. systems see investments data. invest disparate we to we better Belden and with and me moment continue how their our waves is systems. describe in infrastructure modernize a Often take equipment and Across and gather these to uniquely heavily markets, where automate to to

a are the that This marketplace. where find in many data or solution result, carving niche Belden promised our not advantage, and the a multiple is outcomes. a functionality across provide of has do islands As unique with consultants themselves out systems competitive

data products. grow and will reliable always been offerings, be network has our our As highly solutions we foundation and work to the

as all data we management. position, Our comprehensive the acquisition, transmission, a orchestration, offerings; data following portfolio of excel products data and in in leading puts data us

Our solutions has where products been with with our seized improving margins. higher we to growth began a best-in-class result to more customer utilize opportunity the directly with Automation The solve Industrial problems. transformation solution-focused approach

leader access we to a This networks and hybrid needs bring the drive see our Consider, Enterprise large Buildings Smart June, Broadband growth appointed to together Solutions requires past a example, Solutions to campus as Enterprise both address markets. of solutions our unique addition ahead environment products. new in opportunity combined to for across we Segment Enterprise traditional applications. broadband products We ever-expanding and in connectivity that Enterprise compelling a the and change for

data a a on or warehouse, focused common core design Across ability cases. for end by and data use gather to our bring markets, and language it across operating format digestion a the us systems. hospital, data we utilizing gives credibility solutions verticals digitization a We into and move of together, islands solutions, ultimately hybrid our factory floor, easy as

and further functionality product around and Horizon for discussion Now our please X, turn Belden to capabilities. Slide improving

have a for we As cloud-native services devices applications. that connecting, managing provides OT-centric Belden secure, before, is platform and discussed and Horizon deploying,

and our improve is uptime, grow that provides It overall enable computing improvement. of maximize a edge value-add As their and key solutions businesses devices solution. as edge efficiency, and Belden used critical for continuous software applications process updating Horizon Belden of we to an and are the by the onboarding, orchestration offerings, part of management monitoring,

remote suite with and scalable at users to to manage Horizon One, hundreds organizations. easy of integration. contextualize included: support And launch functionality large digital instances. functionality many twins to deployments of Two, the June, Belden Manager, three, empower tooling upgrades protocols of Horizon Belden This or and further addition OT Data data the Belden edge. Horizon with analytics Data and adding Key analyze past empower added and the collect, key the Operations

to out to and Horizon management, simplify combining on Belden management, its upgrades, single network the due security, a networking vendor-agnostic dedicated and Belden networks. aims platform, challenges. analytics of recent With security cyber the cyber focus industrial industry stands and in By security, into optimization

and to our evolution not the is that important reliable produce network products of digitization provider. is reiterate journeys. As customer’s At it we intention our core, transition that enable we data our to a software into highly Belden, consider

Horizon Belden like us enhances with in products differentiating ultimately competitors from brings our comprehensive customers. together and Software and our relationship offerings by deepening one solution our

into for where can for new advantage to Now X, Belden win we Slide product an that both as to for consider our from handling please be we what further exciting Material opportunity, develop is turn further and customers. competitive transformation. Industrial a validates converged solution utilized solutions lean our Enterprise products

equipment major delays. floor was previous In this example, disconnecting their problem, challenged provide across and ample was a causing their customer network our access wireless to a had warehouse

warehouse leader is their it a is automated it's warehouse that market, where no the As matter critical floor. the equipment in always connected, on

even robots. reboots, system it to equipment challenges it hit When delays, manual robot impossible collisions. retrieval targeted processing rates of disconnects requires make even causes These times disabled and and at

the implement and We ensure hybrid tested, took solution, to core and Belden wireless a consultants. as our the solution impact. Enter problem We part KPI and wished the designed, time network to solution, ultimately of understand larger network availability. helped customer to our a

rates. which an in estimate XX% solution, a increase package result process of time-outs and disconnections reduction our ultimately in will As we result XX% in a

marketplace our are will demand and in largest is to three proud are and win developed. The the driving of our products and for solution solution teams highlights award date, finding over years, We our the opportunities solutions. our how incremental span we team and

We that and award and improve to seeking that view and outcomes. to this proof as provide qualified networks products are experts is digitization customers solutions further in uniquely solutions, Belden world-class

provide additional Jeremy request now second-quarter performance. insight to will financial I into our

Jeremy Parks

quarter, second and Thank and for you, by of a will review segment start flow performance. the Ashish. my I the our with of balance followed sheet comments a discussion results results cash

will today. adjusted I reminder, a referencing As results be

X quarter turn review results. again for presentation of delivered our quarter. in to We growth second Slide and a this margin please Now meaningful expansion our

to and a of revenue guidance quarter exceeding $XXX $XXX million record our increased $XXX X% range Second million, year-over-year million. organically to X%

We had X% organically. quarter with impressive increasing Industrial in another Automation revenues

We to and capacity Solutions as production. respond for labor of customers reshoring demand drivers industrial Automation continue compelling see shortages, to requirements, the longer-term

basis, growth Solutions Broadband mid-single-digit with an year-over-year in Solutions in increased later. and Enterprise Smart which X% low-single-digit a discuss revenue organic decline will Buildings, we on

up of were book-to-bill quarter X% we sequentially, a the with the quarter for X.XX. Orders ended

the from below X.X. half our remaining first orders the book-to-bill We in with increase expect to half second

basis product mix better-than-typical margins profit XX.X%, to compared more a to favorable as quarter a were robust XXX the productivity. solutions up points we sell generate prior Gross from continue year. benefited The and

to be up the lower start the gross increasing basis sequential in strong the half, points XXX the would XXXX. we second the compared approximately Given gross slightly This our to QX, strong first to margins QX in for and in given expectations are outperformance imply margins half. year full-year both

income a in XX% $X.XX, to $X.XX million quarter prior-year EPS the guidance period to expanded year-over-year XX% period. and XXX points $XX of to basis to Net $X.XX. the margins record million, million. from EBITDA in EBITDA increased XX% our XX.X%. $X.XX year-ago increased range was exceeded $XXX $XX year-over-year to in And compared up the

harsh of customers to data Automation Key Solutions results. now I audio, Industrial and environments. include mass Turning business presentation review with facilities, in X markets our for a helps begin and energy, the manufacturing, our industrial which Slide segment will secure video, in transmit segment, discrete process and transit.

market segment of million, and of in We each achieved Automation year-over-year Industrial broad-based $XXX Solutions organically. X% The X% increasing generated primary strength revenues our verticals.

the margins to prior EBITDA and due segment Margins mix. the quarter, were for operating in year. Automation favorable increased XXX on to solid points XX.X% compared leverage Industrial volume growth basis XX.X%

networks. now transmit video, and Enterprise complex enables which our Enterprise data audio, secure segment, across Turning and to to customers

revenues key organically. Solutions increasing year X% Our Smart Enterprise The segment of broadband generated and and markets include $XXX solutions X% Buildings. year-over- million,

organically Revenues X% in for by Solutions increased quarter. the Broadband

demands long- funding of our upgrades. combined government outside expect term in ever-increasing data and copper products to continue fiber because network with growth for We

the flat in are channel with first Smart and our temporary destocking, for XXXX, our Buildings by Buildings we which decreased impact expectations. market, orders our line the partners. an Smart increased in of market half impact quarter, channel X% for a on In seeing organically of prior from has Revenues the

in third during and now expect anticipated, We larger experienced QX fourth some a but as feel we impact adjustment quarters. to the

see utilizing For solutions. a by Smart we mid-single headwind, which and Buildings has low continue the market verticals to down the in driven growth to channel for products to digits expect opportunities organic meaningful target year. Smart temporary said, converged our Buildings, full we That be

in XX.X% the were margins EBITDA for year. segment Solutions XX.X% quarter, to prior compared the Enterprise Finally,

Slide If and for you will please our highlights. to cash sheet balance XX turn flow

equivalents to fourth the second compared the end cash second of of $XXX million at quarter in quarter was XXXX. $XXX balance the Our the million $XXX in and million and cash quarter

in financial year a X.Xx was ago. leverage second to end EBITDA at the X.Xx the the XXXX fourth compared quarter, Our and of to net of X.Xx debt quarter

our net As leverage maintain intend approximately XXXX going communicated to we we in Investor forward. of X.Xx Day,

realized an free million we quarter, cash flow second prior cash of million, flow For $XX free million of of year-over-year, the year. the from $XX improvement $XX in

As free second was ahead puts us of which our flow flow targets. quarter, $XXX our cash free the twelve-month trailing of million, full-year cash

Recall XXXX, in million third a from building. that of sale the we received of $XX quarter the

figure our this As current expect twelve-month that to we quarter rolls decrease from trailing off calculation, levels.

$XXX return opportunities. in to generate expect cash room We providing XXXX, second capital of ample than million the flow of high to half deploy free more towards

mentioned have at $XX. during quarter Year-to-date million purchased In share continued we and of shares price $XX we Ashish as toward capital. we XXXX, Finally, million earlier, average $XXX X million deployed around to the toward share M&A approximately approximately an deploy repurchases.

Chand, our my now President That I to the back remarks. outlook. for turn like the Ashish would prepared concludes and CEO, to call

Ashish Chand

Slide Thank updated our Jeremy. to for turn outlook. you, Please XX

Let very pleased am with by our second saying performance. quarter I start me

As growth. EPS, or organic met exceeded and revenue, for we discussed earlier, expectations

year where half we of the Looking second year, clarity be forward incremental continued year uncertainty as we of a XXXX the expect macro the to gain to progresses.

Automation As to in the markets guidance. report first expectations, growth consistent half am Broadband revenue the happy it with Industrial that we after and year, I expect of continued our to past relates our

the see We mid-single Broadband growing growing in Industrial high-single and Automation organically to digits. mid organically the digits in

year. full we Smart down Jeremy headwind, expect mid-single growth temporary for to has Buildings, a previously, which to channel As for be digits organic low the mentioned

The Despite confidence I Belden revenue year including our of impact organic will term. over in full Buildings on our solely Belden XXXX adjustments, see accordingly. me adjusting which reiterate long the my is why suite market. are With business let the be temporary channel revenue, combined our and growth with full we on a Smart fiber, opportunity greater estimates much products solutions, for ahead

of revenues growth to expect now we XXXX, of organic year full the to billion For $X.XXX with $X.XXX X% X%. between billion

continued sales. Next Considering year productivity to raising margin per onto I half expansion, earnings solution our business share. execute our report targets. our happy continues first am we that and full- increased strong with and to EPS higher are

to year. is EPS figure in $X.XX, XX% are between $X.XX companies of We the and a the XXXX. given now XX% representing be facing for EPS to impressive approximately growth expect uncertainties XXXX full-year rather This

expect For $XXX negative and the between third million, quarter, with organic $XXX revenues growth X% to we million positive between of X%.

We $X.XX. expect and between be $X.XX EPS to third-quarter

portfolio designed of Our excess GDP. organic is in to growth deliver

We long-term execute are ability and to confident our strategy sustainable, our in value. shareholder generate

key connectivity, upgrades bandwidth aligns all automation, increasing long-term for Our sustainable secular to produce and Investments reshoring, with growth. Belden in network increased transformed bode portfolio usage, well Belden earnings trends.

closing to turn for remarks. Please Slide XX

reiterate As we value our always framework. to do, I would creation like

excellent healthy capital to progress is by more to allocation. of EPS commitment drive these flow, continues execute goals. growth excess toward robust XXXX and or Belden to Our in making organic and disciplined GDP, $X through achieving is margins, cash

and products solutions healthy. for our End remains demand

channel Buildings same at our Smart impact. business a ROI which not felt of business in three-quarters all the during our our opportunities. currently destocking, incremental Belden While and expanding, Growth challenging whilst is high are reinvesting remaining margins by the are impacted cash we has generating year, continues is

business for and the us With than delivering opportunity shareholders of CEO, the EPS is I longer the I am XX%, convinced at am the as past. The Belden. in to robust of more Belden role more of ahead growth the XX% of our proving

Our strategy offset products solutions is for current world. around and demand challenges uncertainties high-margin the incremental that go-to-market help driving Belden

to making combine in Industrial services I and in Automation we network needs. meaningfully opportunity address a to advancing and see hybrid products changes great marketplace is with our Solutions, Enterprise the are the

to moment Finally, past and of associates Belden drive and a the continue I take transform them like this recognize growth. would our and for their thank to as efforts incremental quarter support we

Our you work! results speak for themselves. for Thank your hard

remarks. our open Operator, concludes call please the to That prepared questions.

Operator

Instructions]. [Operator you. Thank

from the Truist today of Our first Stein comes William Securities. at question line

William Stein

that But on downtick business. better sounds in Buildings exclusively it of it's this full-year Smart channel what's Congrats view. Great. general the in in you've profitability your Thanks questions. for prepared result like inventory the in taking in addressed and the lot like It ask exclusively changed in visibility or my to particular. I'd comments. about understand almost I in a

that that the in hear you. build from understanding through confirm also would maybe First, to seeing have then mitigate of now you channel what and and learned this love sort about process this that might effect we're help Thank we'd happening a future.

Ashish Chand

demand that in of news data priority XX% Good as in revenues, about was total X%. about in time, point-of-sale Automation our just example is we which to Buildings within said broadband Solutions X% We, and Smart our at Yeah, business, with point And focused remarks. QX we up is that morning, reconfirm so Bill. which this prepared encouraging And what of business our first prior organically. overall XX% is half in approximately the and consistent guidance. business, POS, Industrial grew that also for see the verticals on the the the

our estate then partners the markets prior Smart to want they to they sometime estimates of inventory a were that stop and months I in doing is It's think and process going only going that more draw the really Buildings. some is the feeling within issue limited real there about really more a that commercial our of And would that QX. little oriented down turn ago. channel further is dynamic So to couple

X%, we've of effectively this As X.X% end for the a result, down year. rest taken high by the

it's dynamic localized the with and distribution is to yes, that in So basically market the sub-vertical process. the

think connection. that process healthy we've of capability going And have speaks Buildings in more fallen end-user forward, we turns. fine-tuning years, on happens we the some have of build Buildings what I and just terms Smart the think last not kind solutions of specifically. building too I our it have channel is that, area. up And to prior Enterprise trap need over in to requirement inventory. when And that do with to whole two partners a more maybe and in into we as sales fine-tuning Smart on much solution really, maintaining as to our there the more discussed automatically have worked we in you calls, I Now, think learned And

William Stein

or the performance, but when much we mix-related maybe more and all we quantify a understand, Thank talk can you. how little maybe about in margin think improvement mix, if outlook. I and productivity quarter when, follow-up, is you I that, impressive Second the Productivity both higher margin and of wonder on? then bit is products within the much just it how solutions mix.

Ashish Chand

Yes.

is at is mid-teens, best there So, as the XX% know, Industrial in segment. Automation The our point our XX% portion about for that growing. you solutions reference this to

way portfolio the Industrial devices that is passive of that Automation other is think of versus third products business other components, our software. active the and and That's Automation the to a Industrial in Now, the our that's about two-thirds. portion

active solutions the high leading XX% that driving organically. of solutions margins close to And have approximately by that's both margin to improved more with high and essentially are Now, teens obviously portion growing products. content

We haven't mean, I covered already that in done not XX last pricing this months. us. the behind any – year. really That’s we've It's

the more as We content and focused driving on are active solution part very of overall story. software

side, Enterprise the fiber-oriented including on we then specialized products, see for connectivity. more do demand And

transformed approximately you it's we've our XX% know business broadband how seen content. – You've now fiber

margins better So obviously that's too. driving

We think year. first I do within how in we half did the us XX% the of about area on Buildings, the more and verticals. for this of going Smart opportunity more in is forward mix growth

better that think see us those hospital. connectivity, hospitality for in to these a our And in not the connectivity, like to tend federal for example, verticals, I reward products. is just life this specialized markets user saving the do a with for So centers, is really we KPI data the and that but something healthcare,

story, really – The whole solutions is side. right. industrial starting that it's positioning in pay off to very well So that the

to of You the it see on on patches side and more that. Enterprise come

William Stein

you Thank much. very Great.

Ashish Chand

you. Thank

Operator

Fox question the comes and Steve from next Advisors Fox. Our line of

Steve Fox

morning. Good Hi.

First, high-value much mix of on way follow-up. all Is the just sense a benefited on I sales the a just for give how had or solutions? comments Then higher-value higher to follow-up year-over-year you solution. there to shift the from the made just us margins a

Ashish Chand

Steve. Morning, Yes.

really would be expecting the the So on I came year-over-year that to that XXX basis. really – are from say say I solutions approach. of points a came margins that would I of gross basis that would we up say XX% bulk

– this different we before, any said We like that I done we in and haven't haven’t different pricing see year stages.

So has in that the the all network gone industrial beyond solutioning solutions to markets, data solutions, way right.

management So data Belden software for there. us helping example, Horizon is more

Enterprise is gone at a But up gross of the the still result have margins there, On network maybe even that. level. side, solutioning the margins, as

really that, I a to solutions say of all improvement answer margin brief from is on So would dynamics. put coming our

Steve Fox

your at Great. sales line, have of helpful. the broadband about then the piece side, their looking forecast of a your has broadband a spending for That's been top industrial? But we actually couple can discussed rest and the thoroughly. down. On you Enterprise, And competitors downgrading Smart talk the year bit as Building little slowed the

could I you if talk outperformance. curious So was that about

especially Germany. go an you're the organic from X% industrial, looking down we're growth. And in seeing and on outsider purchasing world, manager up then And indexes putting in Europe around

than days seems talk like ago. a in I market that was you outperformance tougher Thanks. XX So what if about wondering could

Ashish Chand

Yes.

business benefiting coming about obviously XX what is long-term are We've in started. spend. already very is spend we've or operator with RDOF seen with benefiting over consistent no our billion; PRS customers. think The [Inaudible] from from change example our in the trends. infrastructure really I is $XX up. said broadband they orders And So for past,

preparing I think funding. that deploy customers are our to

tends from trunking different I of we're and on Steve, the is MSO cyclical us. portion are we of focus more reason lot the the think a that broadband portion is peers the our be which and of what market access out telco, more differentiates operators broadband the who and And some that's building versus to

they those opportunity to of we and a but into buildings, them industrial seeing that, need looking interesting help to that. the go days, Now, of portfolio some Smart lot campuses, for with want already of hybrid they and operators into have, and early networks Buildings also are where we're out products still our

broadband we've So, stable, I avoided the on think business a here. when avoided big spurt really rapidly, think strong reduction, is remained telcos investing and were very we've and we've so footing the I the

industrial, years. that our been products products, And it's and previously, is solutions, look and of suite. I some are understand there's peers at said over wire teens, people our full solution to think but solutions-oriented then third Like to change in I comped software a products needs I mean from business or mid-to-high about driving that those business active be are that a industrial with if of automation three important the cable dramatic market actually. companies, last the now and the in guidance who right, selling they all really you the not And the –

I a that, think about there's when strong So requirement.

frankly, Now, out we that to one actually even expected dynamic than better is turning reshoring dynamic. the is be

investment So, high reshoring and see course companies the qualified of nearshoring, a the that very, or of is face labor. very we lack problem in

In approximately to reading about fact, reshoring due efforts. a right U.S. open now, jobs in million XX% which I there's are that somewhere the was

Belden what connected on labor, think Solutions that valuable, we is improve we that more create if space because solutions. very reduce productivity also labor Automation workers in per does in but the I solutions to through And those dependence our bring unit

there's lot ramp – that. of lot a a So, really on of left it’s

commoditized I the that about solutions more fact players. differentiates network from data and really starting, think doing industrial reshoring is just are and us we

reiterate, to both those So, markets, just feel we good. on

those To fair, guidance not changes past. the POS demand. on and been consistent not first-half as expectation our in the drop, result, in even seen Buildings. very channel a be only as well we've Smart in We've Our It's performance any as changes markets has is end-user seen two solid. with

Steve Fox

helpful. really you. Thank all That's Great.

Ashish Chand

Thank you, Steve.

Operator

The line comes Benchmark question next Company. Our Reuben of the Garner at from

Reuben Garner

everybody. you. Thank morning, Good

talk a between dead a working but to with much and your distribution terms the markets through goes on of solution other business direct of through, differences how you not Buildings more horse your here, Smart you what beat customer in the approach? go like about percentage can So, versus

Ashish Chand

Sure.

Reuben, of channel the distribution. our so partners, is all, in both Smart right, Automation and first Buildings it business, So through in Industrial of through bulk goes

the a difference solution the in Automation the selling the lot important more Consultants and side, on are Belden fulfillment, by fulfilling And that of that's is so piece channel very think done closely them, is the an Industrial opportunities now we supported and salespeople of and Belden there. by the I work whole partners really infrastructure. and with them, identifying right,

On are end-user get the priority we for our we sales than, channel involved far more a the of is fragmented. process. the the because dependent more Smart side, our Building in in healthcare, verticals, Other more hospitality, centers, on lot case partners data market where in sales,

to our So, way, business I or is bulk not by really there of just think direct through there. the direct and The the to – distribution. to story, broadband, it's overwhelming operator complete MSO in

Smart coming So of understanding us I of to is solutions obviously, as back for them. their terms and to in the closer the get challenges some opportunity Buildings, for end-users to creating said before,

we think creation, that’s do slight bulk more to always downstream difference where are less is will on to Smart Buildings fulfill get distribution. That's I and it's and want solution not We our because not skill. – involved Belden involved. just and to want through equipped that focus in We breaking distribution, we

Reuben Garner

kind categories in you're Broadband in seeing And pretty pressure a a Industrial getting change any peers after Automation thanks. few businesses, a you back like years of are a necessarily on you're seeing Are of your it pushed then, theme pricing weakness kind or that slowdown. any consistent Great, inflation? where seeing incremental not from others some sounds strong that of understanding

Ashish Chand

Yes.

before the seeing question, are channel Even even Building me side, dynamics. So, we on change is I what Smart draw let in answer the clarify. just

much. changing I said, We witnessing up are X%. was QX not end Like that our and POS markets

exposed are which difference Telco of Our one is more were X%, KPI sub-verticals on connectivity. like not first focus think verticals remained and beyond in we and half markets, to where cyclical, I hyperscale up are the we've is again the those kind focused

want to So, I just clarify that.

pricing And your pressure. then, question main to on

lot price business those savings in has the per cost total of solution from transformed So, get. they solution. a unit the to ownership they conversations as of a of get the of really or the And really have terms see of the gone our result, effect the and that productivity value away customers

is obviously, the this Now board. not across

We are think still a mitigating factor But I pressure. in early is our price solutions any answer yet. journey. the big And not that's

haven't back justify us But our people and more are and that. consultants expected. equipped this our than people expensive to is we We we coming and people want I seen saying, think to well do do a why are premium product sales

Reuben Garner

you. forward. guys and the Thank Great. Congrats on results strong good luck going

Ashish Chand

Thank you, Ruben.

Operator

[Operator Instructions]. We'll hear next from Mark Delaney Sachs. at Goldman

Morgan Leung

line Mark for for is Leung Morgan behalf of Delaney. – you This taking Good on Thank question. morning. on the Hi. the

funding We Europe talking differ color think North So, demand talked and you. might bit more they government to thank the the little with maybe in you at just so about between ask you trends that for how all you're a today. well. by also seeing wanted all segment, region America, regionally bit tailwinds and potential the from little a dynamic about as China. Enterprise Thank the And I about

Ashish Chand

Sure.

So, APAC way this if And in at of sub-region now. is Non-China QX, about really the and so by about less building indeed business doing is which down X% or mid-single down, of region China kind X% digits only right across up of our it's that point. is the board, than kind is I think the fine.

getting the pretty A in infrastructure India, board, of much data lot across built of Asia, electrification infrastructure investments in those markets, but lot a especially Southeast out. in

across board. So overall the we've seen strength

the especially I reshoring very think for especially right the U.S., focus. Solutions remains Industrial American Automation North given the healthy market, now,

of it's overall trend I in the else really think what on be economy. going just terms in a bucking may

I think, risks. uncertainties, to saying, chain all of the of consumption to in are people need mitigate all spite we do and supply more point closer produce

in on region, around some think of if Europe the then, dark And impact there going is what's I given geopolitics.

but it's you So, much steady consistent, a very, would liked, us, in grown for as automation. very have as market not especially it's

China So, of our we're fine. the is doing picture America well. we're I think Everywhere small as a expected. big very else business. slightly It's doing especially, is very down part U.S. the and North In

we're to And question, in Essentially, spending, of hard your of really seen the our evidence the over Enterprise. content. tailwinds RO seen our XX second in – infrastructure to in operating said then, years. we’ve of we've on of because just with funding some part that partners, be fiber before, getting increased segment, space broadband of I the new that's sorry, And working that specific, It partners. $XX as then, where billion approvals started MSO answer

a Infrastructure that's good really that and – the will the Xx big really that’s out of So, so once Jobs Act tailwind. spending, will dynamic. of portion even comes Investment that's then provide in, And more

Morgan Leung

helpful. That's Thank from you. great. Okay, all That’s today. us really

Ashish Chand

Thank you.

Operator

And that additional closing Mr. question that from back will was remarks Reddington, or for have. any sir today. our I audience our you final it turn you to

Aaron Reddington

operator, for you call. thank joining today's Yes, everyone and thank you

to any here you questions, IR team the please out If have further reach at Belden.

is address Our investor.relations@belden.com. email

Operator

participating. and Thank This ladies may you our does now disconnect. you, and you today, gentlemen. for Thank for call conclude

Belden (BDC) 3 Aug 232023 Q2 Earnings call transcript