What is the percentage of APM's total pipeline that is in new markets for the company
uilding an entire hydrogen supply chain to work with them and what that would mean.
Some of these oil companies that have announced net zero carbon emission targets are asking us to participate in advisory panels, external advisory panels to help them understand what are those technologies that will contribute to, not only continue to produce the amount of energy that will be required to sustain and improve the standard of living of the world population over the next 20, 30 years, but do that in a sustainable manner, producing less emissions and so on.
So what are we doing internally? We have a lot already implied and based on our history, we actually think that Hybrid Models will play an increasing role in sustainability because we will be able to model reactions that are hard to model using first principle and a lot of that has to do with sustainability.
So, we are building -- so having said all that, just like we did with our capabilities around data science and chemo metricians and so on over the last five years, we are now starting to put together teams that will be exclusively focused on sustainability technologies because there is certainly a lot more than we can do. And you will hear more from us during the Investor Day about these. We are very encouraged by what we are hearing from our customers in this whole area of sustainability and how it is been accelerated and the role that they expect us to play as well.
Mark Schappel -- The Benchmark Company -- Analyst
Great, thank you. That is all from me.
Antonio Pietri -- President and Chief Executive Officer
Thank you.
Operator
Thank you. Our last question comes from the line of Blake Gendron with Wolf Research. Your line is now open.
Blake Gendron -- Wolfe Research -- Analyst
Thanks for the time this evening. I want to circle back on APM. And not to pile on here, but trying to get an understanding of the customers that are in trial with APM right now, how many are existing MSC customers and some of the larger customers in your core end markets versus potentially new customers and in new markets for you?
I guess I'm just trying to understand how much of the cash conservatism are users of MSC that just don't want to maybe spend on APM at this time versus I would imagine some logistical hurdles getting into the facilities with COVID or is there something competitively that we should be aware of? Are you waiting for opportunities to maybe displace a competitor in some of these APM opportunities?
Antonio Pietri -- President and Chief Executive Officer
Yes. Well, historically, we have said that about 10%, 15%, really about 15% of our total pipeline is outside of our core industries, the process industries, into mining, into pharma, into other industries. That is probably gone up a little bit over the last four quarters as we focused more on pharmaceuticals and mining.
But I still call it in that 15% range. We had a solid quarter and a solid first half of the year in pharmaceuticals and mining, and really, it is a reflection of our performance with APM in those areas. So we see the difference in decision-making between the industries. And it is what leads us to believe that this is something temporary.
But we are also -- we -- this is now two quarters in a row with this story. We were hoping for a better quarter in December. We thought we were going to have it, didn't materialize at the end. But customers continue to ask to do pilots and prove the value. So I think we are building up a significant pent-up demand that should materialize.
Blake Gendron -- Wolfe Research -- Analyst
No doubt. Yes, it is a challenging environment for sure. In terms of the free cash flow guide, encouraging on the profitability front. It sounds like in this subdued annual spend growth environment that you are able to streamline cost a little bit and take some cost out. I'm just wondering how we should think about cost add back as sales efforts normalize and you are able to do business travel, should we think about it as cash conversion versus annual spend or as a percentage of annual spend growth
uilding an entire hydrogen supply chain to work with them and what that would mean.
Some of these oil companies that have announced net zero carbon emission targets are asking us to participate in advisory panels, external advisory panels to help them understand what are those technologies that will contribute to, not only continue to produce the amount of energy that will be required to sustain and improve the standard of living of the world population over the next 20, 30 years, but do that in a sustainable manner, producing less emissions and so on.
So what are we doing internally? We have a lot already implied and based on our history, we actually think that Hybrid Models will play an increasing role in sustainability because we will be able to model reactions that are hard to model using first principle and a lot of that has to do with sustainability.
So, we are building -- so having said all that, just like we did with our capabilities around data science and chemo metricians and so on over the last five years, we are now starting to put together teams that will be exclusively focused on sustainability technologies because there is certainly a lot more than we can do. And you will hear more from us during the Investor Day about these. We are very encouraged by what we are hearing from our customers in this whole area of sustainability and how it is been accelerated and the role that they expect us to play as well.
Mark Schappel -- The Benchmark Company -- Analyst
Great, thank you. That is all from me.
Antonio Pietri -- President and Chief Executive Officer
Thank you.
Operator
Thank you. Our last question comes from the line of Blake Gendron with Wolf Research. Your line is now open.
Blake Gendron -- Wolfe Research -- Analyst
Thanks for the time this evening. I want to circle back on APM. And not to pile on here, but trying to get an understanding of the customers that are in trial with APM right now, how many are existing MSC customers and some of the larger customers in your core end markets versus potentially new customers and in new markets for you?
I guess I'm just trying to understand how much of the cash conservatism are users of MSC that just don't want to maybe spend on APM at this time versus I would imagine some logistical hurdles getting into the facilities with COVID or is there something competitively that we should be aware of? Are you waiting for opportunities to maybe displace a competitor in some of these APM opportunities?
Antonio Pietri -- President and Chief Executive Officer
 Yes. Well, historically, we have said that about 10%, 15%, really about 15% of our total pipeline is outside of our core industries, the process industries, into mining, into pharma, into other industries. That is probably gone up a little bit over the last four quarters as we focused more on pharmaceuticals and mining.
But I still call it in that 15% range. We had a solid quarter and a solid first half of the year in pharmaceuticals and mining, and really, it is a reflection of our performance with APM in those areas. So we see the difference in decision-making between the industries. And it is what leads us to believe that this is something temporary.
But we are also -- we -- this is now two quarters in a row with this story. We were hoping for a better quarter in December. We thought we were going to have it, didn't materialize at the end. But customers continue to ask to do pilots and prove the value. So I think we are building up a significant pent-up demand that should materialize.
Blake Gendron -- Wolfe Research -- Analyst
No doubt. Yes, it is a challenging environment for sure. In terms of the free cash flow guide, encouraging on the profitability front. It sounds like in this subdued annual spend growth environment that you are able to streamline cost a little bit and take some cost out. I'm just wondering how we should think about cost add back as sales efforts normalize and you are able to do business travel, should we think about it as cash conversion versus annual spend or as a percentage of annual spend growth