← back to rankingRSG · Republic Services, Inc.
Waste Management · mkt cap $62.0B · calls: Q1 FY2026 vs Q4 FY2025
53.0 conviction · conf-adj 52
conf 5/10 partial
enthusiasm:24.0 · trend:0 · quantifies:5 · impact:0 · under_radar:5 · credibility:5 · business_impact:8 · disruption:0 · commitment:0 · confirmation:6
Enthusiasm latest 8 / prev 8 (flat)
Republic’s AI thesis is consistent across both calls: predictive pricing, AI-enabled routing, and digital call-center automation should improve retention, productivity, margins, and growth. Credibility improved modestly in the latest call because management added a concrete target of “at least $100 million of annual benefit by 2028” and explained the expected cadence across pricing, RISE routing, and customer service. The strongest proof points remain forward-looking, with limited realized AI impact disclosed beyond call optimization and proactive notifications.
GROUNDED NEXT-FY IMPACT vs CONSENSUS
Grounded on actual base — revenue $16.6B · net income $2.1B · net margin 12.9% · diluted EPS 6.85
These are next-fiscal-year annual uplift estimates, not next-quarter numbers.
Aggregate next-FY est. rev uplift: 0.075% · next-FY EPS uplift: 0.92% · vs analysts: inline · priced in: medium · confidence: 5/10
| Claim | Figure | Arithmetic | Next-FY Rev % | Next-FY EPS % |
|---|
Digital investments deliver ≥$100M annual benefit by 2028
cost | ≥$100M/yr by 2028 | $100M pre-tax run-rate by 2028. Mgmt frames a pricing-led ramp ('some benefit in 2026, builds 27/28, scales in 28') → assume ~25% phased into next FY2026 = $25M. After-tax @21% = $19.75M / $2,139M NI = 0.92% EPS. Pricing/retention sliver lifts revenue modestly: X read 0%, Y read $25M/$16,591M=0.15% → averaged to 0.075%. Full 2028 run-rate: $79M after-tax = 3.69% EPS. | 0.075 | 0.92 |
Digital tools optimize 11M inbound calls/yr
engagement · soft | 11M calls/yr | Operational volume, no $ deflection rate / cost-per-call / conversion disclosed; feeds the $100M digital benefit. No standalone next-FY figure derivable. | | |
Optimize nearly all 11M customer calls/yr
engagement · soft | ~11M calls/yr | Same call-center program; duplicative operational metric with no $ → not separately sizeable. | | |
70M+ proactive service notifications in 2025
engagement · soft | >70M notifications | Activity/volume metric supporting retention; no avoided-call conversion, retention lift, or cost per notification disclosed → cannot anchor. | | |
Tech/AI cost improvements measured in 9 figures, over time
cost · soft | 9 figures (≥$100M) over time | Magnitude anchored (≥$100M) but timeframe 'over time' has NO fiscal anchor → no next-FY portion derivable. Restates the same $100M digital pool (NOT additive). At ≥$100M pre-tax: ≥$79M after-tax ≈ ≥3.69% EPS at eventual full run-rate. Excluded from aggregate (timing + overlap). | | |
Routing efficiency worth $4–5M per 1 minute/yr
productivity · soft | $4–5M per minute/yr | Unit rate disclosed (HARD): 1 min/yr efficiency = $4.5M pre-tax → $3.56M after-tax = 0.166% EPS PER MINUTE. Minutes captured in next FY are undisclosed, so total next-FY impact is unanchored → soft. Mgmt frames routing as '9 figures over time' (~20+ min equivalent). | | |
9 figures of productivity/routing opportunity, over time
productivity · soft | 9 figures (≥$100M) over time | Overlaps the routing unit-rate and the $100M target — restates the same long-run pool. No FY timing → no next-FY figure. Upside beyond 2028, not aggregatable. | | |
Assumptions: RSG treated as AI adopter. Benefits treated pre-tax; tax 21% → after-tax factor 0.79. EPS sized vs $2,139M GAAP NI (consensus FY25 NI $2,169M / EPS $6.89 within ~1.5% of GAAP $6.85 → base undistorted, not thin; net margin ~12.9%). Next FY=2026. Phasing: $100M is a 2028 run-rate; mgmt says the pricing benefit starts small in 2026 and 'really scales in 28' → ~25% ($25M) in 2026, ~60% in 2027, 100% in 2028 — preferred over an arbitrary even 1/3 split. The $100M 'benefit' is mostly bottom-line/margin; only a small unquantified pricing/retention sliver is revenue. The two '9-figure over time' framings and the $4–5M/min routing rate are components/restatements of the SAME opportunity pool — counted once via the $100M target, not stacked, and excluded from the next-FY aggregate for lack of FY timing.
Top line: Minimal. The $100M is a benefit/margin figure, not new revenue; only a small pricing/retention sliver (~$25M 2026 portion) could touch the top line. X saw 0% and Y ~0.15% of $16.59B rev → averaged to 0.075%, immaterial. Consensus already models ~+3.2% 2026 revenue growth, which comfortably absorbs it.
Bottom line: A bottom-line/operating-leverage story. $100M by 2028 → $79M after-tax = 3.69% of $2.14B NI at full run-rate; the ~25%-phased next-FY (2026) portion ≈ $19.75M after-tax = 0.92% EPS uplift (~+$0.06). The $4–5M-per-minute routing rate ($3.56M after-tax, 0.17% EPS per minute) and the two '9-figure over time' framings corroborate a ≥$100M cost-out pool but carry no fiscal-year timing, so they are excluded from the next-FY aggregate — upside beyond 2028, not 2026 impact.
Consensus 2026 EPS ~$7.28 is ~+5.7% over 2025 $6.89; the quantified next-FY AI benefit (~+$0.06 EPS, 0.92%) sits well inside that growth band and is largely embedded. 2027 consensus ~$8.07 (+10.8%) implies analysts already anticipate margin expansion. The full $100M (3.7% EPS) only lands in 2028 — beyond the estimate horizon — so no quantified figure points clearly above consensus → inline/priced-in. Revenue uplift (~0.075%) is trivial vs consensus 2026 topline growth. The genuine optionality is the unmodeled, unanchored '9-figure over time' cost-out and routing pool, keeping priced_in at medium rather than high.
MODEL CONSENSUS (impact)
partial
Same verdict (inline, medium, ~0.9% EPS, immaterial topline). Adopted Y's quote-grounded phasing; averaged the revenue sliver; null'd duplicative no-timing claims.
Conflicts reconciled
- est_eps_uplift_pct: X=1.231 vs Y=0.92 -> used 0.92 because Y's ~25% phasing cites mgmt 'scales in 28', sounder than X's arbitrary even 1/3 split
- est_rev_uplift_pct: X=0 vs Y=0.15 -> used 0.075 (average; both defensible)
- 9-figure & routing claims soft: X=false(computed EPS) vs Y=true(null) -> used true; duplicative restatements of same pool with no FY timing, more conservative
- supplier_rev_uplift_pct: X=0 vs Y=null -> used null because RSG is an adopter with no supplier side
- confidence: X=6 vs Y=6 -> 5, lowered for conflicts resolved conservatively
| Field | Opus 4.8 | GPT-5.5 |
|---|
| Rev uplift % | 0.15 | 0 |
| EPS uplift % | 0.92 | 1.2311048776686804 |
| Priced in | medium | medium |
| vs analysts | inline | inline |
| Confidence | 6 | 6 |
| Top line | Minimal. The $100M is a benefit/margin figure, not new revenue. The pricing-led 2026 portion (~$25M) is ~0.15% of $16.59B revenue — immaterial to the top line, though it supports price retention and lower attrition. Consensus already models +3.2% 2026 revenue growth ($16.66B→$17.19B), which comfortably absorbs this. | No quantified AI revenue claim is disclosed. The call-center and notification metrics are operational engagement metrics without $ conversion, so estimated revenue uplift is 0.0%. |
| Bottom line | This is a bottom-line/operating-leverage story. $100M by 2028 → $79M after-tax = 3.69% of $2.14B NI at full run-rate; the ~25%-phased next-FY (2026) portion is ~$19.75M after-tax = 0.92% EPS uplift (~+$0.06). The $4–5M-per-minute routing rate ($3.56M after-tax, 0.17% EPS per minute) and two '9-figure over time' framings corroborate a ≥$100M+ cost-out pool but carry no fiscal-year timing, so they are excluded from the next-FY aggregate — they represent upside beyond 2028, not 2026 impact. | The hard non-duplicative claim is at least $100M annual benefit by 2028. At a 21% tax rate that is $79M after tax, or 3.693% of current net income at full run-rate; assuming an even ramp, FY2026 impact is $26.333M after tax, or 1.231%. Routing is a useful sensitivity at 0.166% EPS uplift per minute saved. |
| Reasoning | Consensus 2026 EPS $7.28 is +5.7% over 2025 $6.89; the quantified next-FY AI benefit (~+$0.06 EPS, 0.92%) sits well inside that growth band and is largely embedded already. 2027 consensus EPS $8.07 (+10.8%) implies analysts anticipate margin expansion. The full $100M (3.7% EPS) only lands in 2028 — beyond the estimate horizon shown — so no quantified figure points clearly above consensus → inline/priced-in. The genuine optionality is the unmodeled, unanchored '9-figure over time' cost-out and routing pool, which keeps priced_in at medium rather than high. | Consensus FY2026 net income is $2.286B, up $147.1M or 6.878% from the $2.139B base; consensus FY2026 EPS is up 6.344%. The de-duplicated FY2026 AI benefit estimate of $26.333M after tax is only 17.9% of the consensus net-income growth and adds 1.231% EPS uplift, while revenue uplift is 0% versus consensus FY2026 revenue growth of $601.0M or 3.623%. The math supports margin help, not a separate topline acceleration above consensus. |
Rows highlighted where the two models disagreed.
QUANTIFICATIONS
Annual benefit from digital investments: at least $100 million (by 2028, both)
“We believe that these investments in digital will deliver at least $100 million of annual benefit by 2028.”
Inbound calls optimized by digital tools: 11 million inbound calls (each year, both)
“Activation of digital tools in our call centers are enhancing the customer experience and unlocking value in our business by optimizing the 11 million inbound calls we receive each year.”
Customer calls optimized by digital tools: nearly all 11 million customer calls (each year, both)
“Additionally, our digital tools are helping us optimize nearly all 11 million customer calls we receive each year.”
Proactive service notifications: more than 70 million (2025, both)
“In fact, in 2025 alone, we delivered more than 70 million proactive service notifications, addressing our most common customer inquiries such as holiday service schedules and weather-related delays.”
Cost improvements from technology and AI: 9 figures (over time, bottomline)
“We'll do a little more work here and give you specific numbers, but these are going to -- over time, this is going to be cost improvements measured in 9 figures for sure.”
Routing efficiency value: $4 million to $5 million (per 1 minute across the system a year, bottomline)
“I mean there is a lot of efficiency that we can drive through and 1 minute across our system a year of routing efficiency on our routing side is worth $4 million to $5 million.”
Productivity and routing opportunity: 9 figures (over time, bottomline)
“And I mentioned we think there's 9 figures of opportunity over time on productivity and how we route.”
PAST (realized)
- In fact, in 2025 alone, we delivered more than 70 million proactive service notifications, addressing our most common customer inquiries such as holiday service schedules and weather-related delays.
- And then pricing is going to be a third big lever for us, which is getting very surgical in how we price. Again, we do a great job today with our current set of tools.
- So pricing today, we're using dozens of variables through AI to build bespoke prices to existing customers when we send them our annual price increase.
CURRENT (now)
- We continue to make investments in new technologies and AI-enabled tools that strengthen our competitive position and create measurable value.
- For example, we are deploying advanced analytics to optimize pricing based on specific attributes and local market dynamics.
- We are actively deploying AI-based predictive technology that supports optimized pricing decisions across markets with varying customer and competitive dynamics.
- Activation of digital tools in our call centers are enhancing the customer experience and unlocking value in our business by optimizing the 11 million inbound calls we receive each year.
- But as we're now deploying AI, we're getting far more scientific and really understanding customer lifetime value as we price these customers to get a great price today, but also a price that incents them to stay with us for a long period of time.
FORWARD (guidance)
- Over time, these capabilities are expected to drive additional growth, expand margins and support continued operating leverage.
- This approach is expected to reinforce price retention and reduce customer attrition over time.
- The integration of AI and advanced routing algorithms is expected to improve safety outcomes, strengthen service execution and increased route efficiency.
- We believe that these investments in digital will deliver at least $100 million of annual benefit by 2028.
- Pricing will come first, and we'll see some benefit in 2026, and that will build over '27, '28.
- You'll start to see that benefit come in '27 and then that will really scale in '28 and that, again, will be the largest impact.
- These are the 3 where we see the most immediate benefit to scale, but it will have profound impact across the business.
- Over time, this is going to be cost improvements measured in 9 figures for sure.
- AI is going to be a very powerful tool that is going to show up in terms of compressing our inflation over time.
TRACK RECORD — PROMISE vs DELIVERY
55/100 track record too-early 6 calls reviewed
Republic's only large, explicitly-quantified AI promise — ~$100M of annual digital/AI benefit by 2028 — was just made and is not yet judgeable, so the record is dominated by too-early items; supporting evidence is mildly positive (a delivered $60M computer-vision contamination program and partial progress on EMPower), but no AI-specific numeric target has yet come due to confirm or refute credibility.
Digital/AI investments (AI pricing, AI+algorithmic RISE routing, call-center automation) to deliver at least $100M of annual benefit by 2028 — promised Q1 FY2026
too-early Only set this quarter; mgmt sequenced benefits (pricing first in 2026, routing scaling 2027-28) but the 2028 milestone has not arrived, so unjudgeable
Camera-based computer-vision detection of overfilled/contaminated containers via RISE generating $60M incremental revenue in first year — promised Q4 FY2024
delivered Reported as already achieved ($60M in year one) and the fee program continued to anniversary into 2025, showing execution on a deployed AI/vision capability
EMPower fleet/equipment management system to deliver $20M annual cost savings, deployment complete by end of 2025 — promised Q4 FY2024
partial Deployment progressed (~40% of facilities by Q1 FY2025) and mgmt cited strong maintenance-cost performance, but the specific $20M figure was never explicitly confirmed as achieved
AI/algorithmic routing upgrade to RISE platform to lift route-level productivity and cost efficiency — promised Q4 FY2025
too-early Reaffirmed in Q1 FY2026 but mgmt explicitly said little-to-no benefit in 2026, scaling in 2027-28 — no number hit yet
PRICED-IN (REFINED)
MEDIUMEst. revisions flat · Fwd P/E 29.3 · EV/Sales 3.7x
AI claim maps to Collection Service Line - Small-container, Collection Service Line - Large-container, Collection Service Line - Residential
Estimate signals are not rising: ratings have shifted slightly toward more holds versus buys, and last-month price targets are flat with last-quarter targets and below the last-year average. Forward revenue and EPS estimates grow, but at a modest pace for a mature waste-management business rather than showing a sharp AI-driven revision cycle. Valuation is rich at 29.3x forward EPS and 3.7x EV/sales, so some efficiency upside in the core collection lines is likely reflected, but without rising revisions the setup is mixed rather than fully priced in.
COVERAGE — ENTHUSIASM TRAJECTORY + CATALYSTS
7Q4 FY20244Q1 FY20252Q2 FY20252Q3 FY20258Q4 FY20259Q1 FY2026
AI enthusiasm across 6 calls — trend ↗ rising
AI went from isolated camera-enabled revenue to broad pricing, routing and call-center initiatives with quantified 2028 benefits.
RECENT AI CATALYSTS & NEWS
BUSINESS IMPACT - QUALITATIVE MATERIALITY
7/10 qualitative impact material medium-term · mixed evidence
Where AI matters: pricing, routing, customer service and fleet productivity
AI is being deployed in core operating levers: predictive customer-level pricing, route optimization, call-center automation and computer-vision contamination/overfill programs. The quantified target of at least $100M annual benefit by 2028 is meaningful for margins, but most benefits are forward-looking and cost/productivity-led rather than a major new revenue pool.
Caveats: 2028 benefit target is not yet proven and may be delayed by data quality or routing execution issues; Competitors can deploy similar pricing and routing tools, limiting durable differentiation; Aggressive AI-driven pricing could increase churn or regulatory/customer pushback if poorly calibrated
AI DISRUPTION / CANNIBALIZATION RISK tailwind · 1/10
Republic sells essential physical collection, disposal and environmental services backed by route density, assets, permits and local contracts; AI does not commoditize or automate away the need for waste hauling. The main risk is peers using similar tools, not AI deflating the core revenue model.
OPTIONS / MARKET STRUCTURE
option liquidity: good
proxy inputs — dollar-ADV $329M · beta 0.438 · px $201.67
source: proxy (no options chain on FMP)
FMP /stable/ exposes no options-chain endpoint on this key, so ATM IV, bid-ask spread and open interest are unavailable. Liquidity below is a PROXY from dollar-ADV, beta and price level (a stand-in for option depth), not measured option-market data.
CONFIRMATION — INSIDERS · 13F · LANGUAGE
Confirming — insiders buying, institutions adding, management language 6/10 measured.
INSIDERS buying 21 open-market buy(s) vs 2 sell(s) — net accumulation
INSTITUTIONS (13F) adding as of 2026-03-31: 128 new / 131 closed positions; 661 increased / 446 reduced; institutional ownership -1.04pp; +0 net 13F holders
MGMT LANGUAGE 6/10 measured Real ownership and a quantified benefit target, but much language is expected, over time, and phased rather than firm near-term delivery.
commit “We are actively deploying AI-based predictive technology that supports optimized pricing decisions across markets with varying customer and competitive dynamics.”
commit “We believe that these investments in digital will deliver at least $100 million of annual benefit by 2028.”
commit “Pricing will come first, and we'll see some benefit in 2026, and that will build over '27, '28.”
VERBATIM AI QUOTES
“Our ongoing investments in technology and AI are strengthening how we operate and compete.”
— Jon Vander Ark, Q1 FY2026
“Over time, these capabilities are expected to drive additional growth, expand margins and support continued operating leverage.”
— Jon Vander Ark, Q1 FY2026
“We are actively deploying AI-based predictive technology that supports optimized pricing decisions across markets with varying customer and competitive dynamics.”
— Jon Vander Ark, Q1 FY2026
“This approach is expected to reinforce price retention and reduce customer attrition over time.”
— Jon Vander Ark, Q1 FY2026
“The integration of AI and advanced routing algorithms is expected to improve safety outcomes, strengthen service execution and increased route efficiency.”
— Jon Vander Ark, Q1 FY2026
“Activation of digital tools in our call centers are enhancing the customer experience and unlocking value in our business by optimizing the 11 million inbound calls we receive each year.”
— Jon Vander Ark, Q1 FY2026
“We believe that these investments in digital will deliver at least $100 million of annual benefit by 2028.”
— Jon Vander Ark, Q1 FY2026
“I mean, we're looking at AI in every area of the business, back office, legal, HR, all kinds of places.”
— Jon Vander Ark, Q1 FY2026
“These are the 3 where we see the most immediate benefit to scale, but it will have profound impact across the business.”
— Jon Vander Ark, Q1 FY2026
“So pricing today, we're using dozens of variables through AI to build bespoke prices to existing customers when we send them our annual price increase.”
— Jon Vander Ark, Q1 FY2026
“And so we're trying to get that as surgical as possible to give them a price that maximizes both what they'll pay and incent them to stay over a long period of time.”
— Jon Vander Ark, Q1 FY2026
“Where the routing, there's a lot of upfront work, particularly around data and data accuracy and data management that you need to have in place so that when you start routing dynamic -- building dynamic routes through AI and then routing dynamically through the day, you get it right.”
— Jon Vander Ark, Q1 FY2026
“We continue to make investments in new technologies and AI-enabled tools that strengthen our competitive position and create measurable value.”
— Jon Vander Ark, Q4 FY2025
“These capabilities extend across our organization and are expected to unlock incremental growth, enhance profitability and drive sustained operating leverage.”
— Jon Vander Ark, Q4 FY2025
“For example, we are deploying advanced analytics to optimize pricing based on specific attributes and local market dynamics.”
— Jon Vander Ark, Q4 FY2025
“Over time, we expect this will strengthen price retention and reduce customer churn.”
— Jon Vander Ark, Q4 FY2025
“By applying AI and algorithmic-based routing, we see meaningful opportunities to improve safety, enhance service delivery and increase route-level productivity, benefits that translate directly into cost efficiency and a better customer experience.”
— Jon Vander Ark, Q4 FY2025
“Additionally, our digital tools are helping us optimize nearly all 11 million customer calls we receive each year.”
— Jon Vander Ark, Q4 FY2025
“In fact, in 2025 alone, we delivered more than 70 million proactive service notifications, addressing our most common customer inquiries such as holiday service schedules and weather-related delays.”
— Jon Vander Ark, Q4 FY2025
“AI is a game changer of taking a lot of complexity and designing routes in a more efficient fashion.”
— Jon Vander Ark, Q4 FY2025
“But as we're now deploying AI, we're getting far more scientific and really understanding customer lifetime value as we price these customers to get a great price today, but also a price that incents them to stay with us for a long period of time.”
— Jon Vander Ark, Q4 FY2025
“And then every element of our support, including how we answer calls, how we process orders and invoices, everywhere around the chain, we're challenging how work gets done and AI is going to be a very powerful tool that is going to show up in terms of compressing our inflation over time.”
— Jon Vander Ark, Q4 FY2025
ANALYST QUESTIONS ON AI
Q (Q1 FY2026, Noah Kaye): So AI and digital productivity, definitely a strong theme for the sector and for you this quarter. You called out you expect $100 million, I think, of annual benefits from investments by 2028. I guess first, can you sort of benchmark where that benefit might be penciling out for '26? And how to think about it flowing in a couple of years? And then maybe just to unpack a little bit the buckets of benefit that you're getting here.
A: Yes. We mentioned on the latter part of your question, we mentioned 3 areas of the benefit, routing, the RISE pricing and then customer service. And I would list those in terms of the priority of the impact or the scale of the impact over time. Pricing will come first, and we'll see some benefit in 2026, and that will build over '27, '28. We're going to see very little, probably no benefit of that in 2026 on RISE just because we're doing all the work, and that will scale. You'll start to see that benefit come in '27 and then that will really scale in '28 and that, again, will be the largest impact. And then on the customer service, I think you'll see ratable improvement across the 3 years. Right now, that's the smallest of the 3 categories I mentioned. And those aren't the only 3. I mean, we're looking at AI in every area of the business, back office, legal, HR, all kinds of places. These are the 3 where we see the most immediate benefit to scale, but it will have profound impact across the business.
Q (Q1 FY2026, Adam Bubes): And then I think the spread between core price and yield was a little wider this quarter at 2.7% versus I think 2% last year. Is that just a mix impact? Or what's driving that? And can you talk about how you think about that spread going forward as you continue to leverage AI to implement more surgical pricing tools?
A: Yes, it predominantly is mix. You're spot on there. And in part, I would say it's driven by the relatively better performance we're seeing in the temporary large container business, which is predominantly construction-related activity. So sequentially, the volume performance improved 500 basis points. And so that's where you tend to see that impact because we don't capture price on a temporary unit. You'll see it in that churn mix and other, which is the difference between the core price and the average yield. The good news is that as those units return, right, you're getting that incremental volume, but it's what it ultimately leads to. It's that permanent unit of service. It's the temporary units leading to that household formation, which ultimately leads to that small business formation, which is extraordinarily important to us.
Q (Q1 FY2026, Stephanie Benjamin Moore): I wanted to circle back on some of the commentary that you provided on your RISE digital platform. I think some of your peers have talked about leveraging technology for more dynamic pricing discussions. And I wanted to see if that's an area that you guys have tackled as of late. And at the same time, I think you've talked in the past about some opportunity with AI and algo-based routing. So I wanted to get an update there as well.
A: Yes, on both sides. So pricing today, we're using dozens of variables through AI to build bespoke prices to existing customers when we send them our annual price increase. And so we're trying to get that as surgical as possible to give them a price that maximizes both what they'll pay and incent them to stay over a long period of time. And that is a game of inches in terms of dialing that in, but small basis points across individual customers adds up quickly across the system and feel really encouraged. And that will just continue to get better and better over time. It kind of builds in a more linear fashion. Where the routing, there's a lot of upfront work, particularly around data and data accuracy and data management that you need to have in place so that when you start routing dynamic -- building dynamic routes through AI and then routing dynamically through the day, you get it right. And what we won't do is sacrifice customer service to pursue short-term gains. We're going to get it right with the customer first and then drive all of the operational efficiency through the system while improving customer service. And that's why you'll start to see some of that benefit in the second half of next year, but that's really 2028 where we think we scale.
Q (Q4 FY2025, Kevin Chiang): Then just you spoke of some of the opportunities you're seeing on the technology side, on the RISE platform using AI. Total cost of operations below 58% for '25. Just wondering, as you think about the -- I guess, over the longer term and you're utilizing this technology, so maybe where you think that can go from a cost efficiency perspective?
A: Yes. We'll do a little more work here and give you specific numbers, but these are going to -- over time, this is going to be cost improvements measured in 9 figures for sure. I mean there is a lot of efficiency that we can drive through and 1 minute across our system a year of routing efficiency on our routing side is worth $4 million to $5 million. So you can see how that can accrue as you get optimized traffic patterns and optimize disposal optimization on our routes, and there's a lot of variables today. We do a very good job with the set of tools we have today. AI is a game changer of taking a lot of complexity and designing routes in a more efficient fashion. You'll see some of this on the back office side, and we've talked about call centers in the prepared remarks and just being able to service customers digitally in the way they want, getting them an answer and saving the cost of having people answering the phone. And then pricing is going to be a third big lever for us, which is getting very surgical in how we price. Again, we do a great job today with our current set of tools. But as we're now deploying AI, we're getting far more scientific and really understanding customer lifetime value as we price these customers to get a great price today, but also a price that incents them to stay with us for a long period of time.
Q (Q4 FY2025, Tobey Sommer): If we look at the spread in the margin expansion that you're able achieve and kind of put the pricing and revenue volume to one side and really focus on the expense side. To what extent do you think you've got opportunities to invest more in tech, extract some savings and efficiencies through AI and other means to like restrain your level of expense growth even further and contribute to a greater spread expansion?
A: Yes. I mentioned earlier, right, we're spending a lot of money on technology because we see the return clearly. Some of that is AI. Some of that is just modernizing our existing systems and updating that. And I mentioned we think there's 9 figures of opportunity over time on productivity and how we route. We see real opportunities on pricing but that's on the cost side, but that will be another growth driver. And then every element of our support, including how we answer calls, how we process orders and invoices, everywhere around the chain, we're challenging how work gets done and AI is going to be a very powerful tool that is going to show up in terms of compressing our inflation over time.