GE HealthCare Technologies Inc.

Good day, and welcome to GE Healthcare's third quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will be given at that time. As a reminder, this call is being recorded. I would like to turn the call over to Carolyn Borders, Head of Investor Relations. You may begin.

Thanks, Operator. Welcome to GE Healthcare's third quarter 2023 earnings call. I'm joined by our President and CEO, Peter Arduini, and our Vice President and CFO, Jay Saccaro. Our conference call remarks will include both GAAP and non-GAAP financial results. Reconciliations between GAAP and non-GAAP measures can be found in today's press release and in the presentation slides available on our website. During this call, we'll make forward-looking statements about our performance. These statements are based on how we see things today. As described in our SEC filings, actual results may differ materially due to risks and uncertainties. And with that, I'll hand the call over to Peter.

Thanks, Carolyn. Good morning, everyone, and thanks for joining us today for our third quarter call. To start, I want to say we're pleased with our growth, margin, and cash flow performance in the quarter. Recently, we've launched several new products, which I'll talk about in greater detail later, and announced multiple strategic artificial intelligence based collaborations aimed at supporting new product introductions and clinical applications. We're honored to have received a grant from the Bill and Melinda Gates Foundation to develop ultrasound tools for less experienced healthcare professionals and support more effective obstetric and lung ultrasound screening for patients in low and middle income countries. We also signed a contract with BARDA, a division of the US Department of Health and Human Services, to develop advanced ultrasound technology with new AI applications for patients with lung pathologies and traumatic injuries. Both of these combined represent over $80 million of committed funding. Lastly, we announced a strategic collaboration with Mayo Clinic for innovation in medical imaging and theranostics to enhance precision diagnosis and improve patient treatment by using multimodal data, AI, and digital health solutions. We're excited about our recent collaborations and how this will help us deliver on our precision care strategy. The business has demonstrated resiliency and our team has executed this year. We're on track to meet our goals we set at the beginning of the year, and we're making good progress on our mid-range targets. Despite several macro challenges that occurred in 2023, we have been intensely focused on financial and operational execution to deliver on our commitments. Turning to slide three, we delivered strong third quarter performance with 6% year-over-year organic revenue growth driven by volume and price. Importantly, book to bill in the quarter was 1.03 times, slightly below our book to bill of 1.04 times in the second quarter. Customers cite rising procedure backlog as a reason for capital investments, particularly for products that we offer. Backlog remains robust at $18.4 billion, driven by services and imaging products, and remains more than $1 billion higher than pre-COVID levels, which gives us confidence in future quarters. Orders growth was 1% versus the same period last year. We recently completed a customer pulse survey in the US and see no significant change in sentiment on capital spending in the second half of 2023 versus the first half of the year. Orders growth can be lumpy in any given quarter, and results do not directly translate to near-term revenue growth. And this is why we give book-to-bill metric as well as total backlog. As it relates to China and the anti-corruption campaign, We saw a limited impact to our orders and revenue in the quarter. Both measures were up year over year. We continue to expect a limited impact in the fourth quarter. Also, as a reminder, fourth quarter 2022 orders experienced significant growth due to the China stimulus launched last year, which will influence the year over year comparisons next quarter. China continues to be an important market with a promising growth profile. During the quarter, we continue to make steady progress on our productivity initiatives and business optimization using lean. For example, delivery performance has improved over 15%, a direct result of implementing pool methodology. The number of purchase components classified as high risk for availability has reduced by approximately 35% year-to-date, and customer lead times have improved by more than 15% versus prior year. And lastly, customer satisfaction surveys for service have improved approximately 10%, supported by improvement in parts availability and the great efforts by the service team. On the profit line, we generated adjusted EBIT margin expansion while simultaneously accelerating R&D investment. This speaks to our execution capabilities as well as our commitment to funding long-term innovations. Turning to capital allocation, we remain committed to executing an optimized strategy with the focus on creating value for shareholders. Our strong free cash flow generation in the third quarter positions us to be flexible in our capital allocation priorities. We aim to deliver a dividend while continuing to evaluate organic and inorganic investments and deleveraging opportunities. Overall, global markets have remained resilient, our backlog remains healthy, and our team continues to execute. As a result, we're raising the low end of our adjusted 2023 EPS range, representing growth of 11 to 14%. Jay will now take you through our financials and business performance. Jay?