Financial Data and Key Metrics Changes - The company reported adjusted EPS of $17.14 for 2025, exceeding initial guidance of approximately $16.25 [17] - The full-year insurance segment benefit ratio was 90.4%, slightly better than guidance [18] - For 2026, the company expects full-year adjusted EPS of at least $9, with a year-over-year decline anticipated due to a stars headwind [19] Business Line Data and Key Metrics Changes - The company experienced approximately 1 million member growth, or 20%, during the Annual Enrollment Period (AEP) [8] - Retention rate improved by over 500 basis points year-over-year, with over 70% of new sales coming from switches from competitor plans [9] - The company expects individual Medicare Advantage (MA) membership growth of approximately 25% for full year 2026 [10] Market Data and Key Metrics Changes - The company absorbed approximately 12% of members impacted by competitor plan exits, which is less than its market share [9] - Nearly 30% of new sales were bounce-back members, indicating a positive mix of new sales [9] Company Strategy and Development Direction - The company remains committed to a consumer-centric strategy, focusing on maximizing customer lifetime value and member retention [6] - Plans are designed to be priced for sustainable margins, moving away from loss leader strategies [8] - The company is expanding its Medicaid and CenterWell footprint, with Medicaid now spanning 13 states [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational capacity to absorb growth and maintain quality care for members [10] - The company is adapting to the funding environment and expects to unlock earnings potential by 2028 [15] - Management acknowledged the challenges posed by the Advance Rate Notice but emphasized a commitment to protect consumers [15] Other Important Information - The company is focused on capital efficiency and plans to fund membership growth and strategic acquisitions while maintaining credit ratings [24] - A new President of Medicare Advantage, Aaron Martin, joined the company, bringing extensive healthcare experience [16] Q&A Session Summary Question: Can you expand on the level of earnings outside of MA underwriting? - Management indicated that earnings associated with CenterWell will contribute positively, with significant tailwinds expected from new membership [30] Question: How is the typical progress of margins for new members over time? - Management noted that margins typically improve significantly from year one to year two, with ongoing improvements expected in subsequent years [35] Question: What are the expectations for 2026 compared to Investor Day? - Management highlighted that the biggest difference is the embedded conservatism in their numbers, leading to a broader haircut in guidance [45] Question: How did the D-SNP membership growth compare to expectations? - The absolute number of new D-SNP members exceeded expectations, although the percentage growth was slightly lower [48] Question: What is the impact of the stars headwind on margins? - Management explained that the stars headwind affects both new and existing members, with similar margins expected for both cohorts [32] Question: How will the company adjust to the rate notice? - Management stated that they will adapt to the final rate notice and advocate for appropriate funding levels [59]

Financial Data and Key Metrics Changes - In Q4 2025, Las Vegas operations achieved net revenue of $505 million, a 2.5% increase year-over-year, and adjusted EBITDA of $231 million, up 3.2% from the previous year [8][9] - For the full year 2025, net revenue was just under $2 billion, a 2.9% increase, and adjusted EBITDA reached $915.9 million, up 4.2% from the prior year [9][10] - The consolidated Q4 net revenue was $511.8 million, up 3.2%, and adjusted EBITDA was $213 million, up 5.4% year-over-year [8][9] Business Line Data and Key Metrics Changes - Durango Casino Resort continues to expand its local market presence, contributing to incremental play and reinforcing its growth driver status within the portfolio [5] - Non-gaming operations, including hotel and food and beverage, achieved near-record revenue and profitability, with hotel operations performing exceptionally well despite renovations [11][12] Market Data and Key Metrics Changes - The Las Vegas locals market remains strong, with 50% of guests visiting more than eight times a month, indicating a robust customer base [31] - The company is strategically located in areas of new housing growth, enhancing its competitive position in the locals market [32] Company Strategy and Development Direction - The company is focused on executing its development pipeline, including significant investments in Durango, Sunset Station, and Green Valley Ranch, to enhance competitive positioning and customer appeal [15][17][23] - A special cash dividend of $1 per Class A common share was declared, reflecting confidence in the long-term earnings power of the operating model [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength and resilience of the business, despite expected near-term disruptions from ongoing construction projects [12][23] - The company anticipates capturing additional market share and driving sustained growth in the local market through strategic expansions and enhancements [8][19] Other Important Information - The company reported a net debt-to-EBITDA ratio of 3.87 times, marking the seventh consecutive quarter of deleveraging [13] - Total capital spend for 2025 was $319 million, with expectations to increase to $375-$425 million in 2026 [14] Q&A Session Summary Question: Demand levels in Las Vegas Valley - Management noted strong performance in hotel operations and gaming, with a differentiated value proposition compared to the Strip [28][31] Question: Construction disruption in 2026 - Management estimated approximately $9 million in disruption for Q1 2026, primarily from ongoing renovations [42][44] Question: Seasonal EBITDA expectations - Management indicated that while disruption may impact Q1, they remain confident in achieving expected returns [48][49] Question: Impact of the One Big Beautiful Bill - Management expressed optimism about capturing discretionary income from tax refunds, positioning the company well in the locals market [53] Question: Higher-end customer contributions - Management highlighted strength in higher-end play across various properties, indicating a broad appeal to different customer segments [80][81]

Financial Data and Key Metrics Changes - The company reported FFO of $0.97 per diluted share in Q4 2025, with occupancy ending the year at 81.6%, reflecting a 60 basis point sequential improvement [24] - Cash same-property NOI growth was negative 7.2% in Q4, primarily due to a sizable restoration fee recognized in Q4 2024, which detracted 350 basis points from current year growth [24] - The 2026 FFO guidance range is set at $3.25-$3.45 per diluted share, with an expected average occupancy of 76%-78%, a decline of 390 basis points at the midpoint compared to 2025 [26][27] Business Line Data and Key Metrics Changes - Fourth quarter leasing totaled approximately 827,000 sq ft, marking the strongest performance in six years, leading to a full-year leasing total of approximately 2.1 million sq ft, a significant year-over-year increase [4][5] - Key leasing highlights included a 93,000 sq ft lease with the Fitler Club in Hollywood and a 316,000 sq ft lease with UCSF at Kilroy Oyster Point Phase Two, indicating strong demand in the life sciences sector [6][8] Market Data and Key Metrics Changes - The company experienced the healthiest level of office demand since 2019, with a forward leasing pipeline growing by over 65% in the last year [6] - In San Francisco, premium sublease space is nearly gone, with 47% of the overall availability not transacted since 2021, indicating a recovery in the market [44][60] Company Strategy and Development Direction - The company is focused on disciplined execution across its platform, including driving leasing, monetizing non-core assets, and redeploying capital into high-quality opportunities [4][15] - The acquisition of Nautilus for $192 million strengthens the company's presence in the life sciences sector, positioning it to capture demand across West Coast markets [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the leasing environment, particularly in San Francisco, where new business formation is driving demand [81] - The company anticipates a robust M&A environment in the life sciences sector, with expectations for continued growth in leasing activity [8][9] Other Important Information - The company completed approximately $755 million in sales, including $465 million from operating properties and $165 million from land sales, indicating a strategic approach to capital allocation [17] - The anticipated yield at Kilroy Oyster Point Phase Two is now in the mid-5% range, reflecting adjustments based on leasing activity and market conditions [11] Q&A Session Summary Question: Can you discuss the UCSF anchor lease and its late commencement? - Management noted that the UCSF lease is part of a new development project in shell condition, requiring time for build-out and space planning [34][35] Question: What are the expectations for retention on the 1.05 million sq ft expiring in 2026? - Management expects substantial move-outs from this pool but has already backfilled about 140,000 sq ft and anticipates additional renewals [50][51] Question: What is the competitive landscape for KOP and potential monetization? - Management remains confident in the long-term growth potential of KOP and believes it has created significant value in phase one, with future phases dependent on achieving favorable yields [76][77]

Financial Data and Key Metrics Changes - The company reported FFO of $0.97 per diluted share in Q4 2025, with occupancy ending the year at 81.6%, reflecting a 60 basis point sequential improvement [24] - Cash same-property NOI growth was negative 7.2% in Q4, primarily due to a sizable restoration fee recognized in Q4 2024, which detracted 350 basis points from current year growth [24] - The 2026 FFO guidance range is set at $3.25-$3.45 per diluted share, with average occupancy expected to decline to 76%-78% [26][27] Business Line Data and Key Metrics Changes - Fourth quarter leasing totaled approximately 827,000 sq ft, marking the strongest performance in six years, leading to full-year leasing of approximately 2.1 million sq ft, a significant year-over-year increase [4][5] - Key leasing highlights included a 93,000 sq ft lease with the Fitler Club in Hollywood and a 316,000 sq ft lease with UCSF at Kilroy Oyster Point Phase Two [6][8] Market Data and Key Metrics Changes - The company experienced the healthiest level of office demand since 2019, with a forward leasing pipeline growing by more than 65% over the last year [6] - In San Francisco, premium sublease space is nearly gone, with 47% of the 32% availability not transacted since 2021, indicating a recovery in the market [42][60] Company Strategy and Development Direction - The company is focused on driving leasing across its operating and development portfolios while monetizing non-core assets and redeploying proceeds into select opportunities [4][15] - The acquisition of Nautilus for $192 million strengthens the company's presence in the life science sector, positioning it to capture demand across West Coast markets [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the leasing environment, particularly in San Francisco, where new business formation is driving demand [81] - The company anticipates a robust M&A environment in the life science sector, with expectations for continued growth in leasing activity [8][9] Other Important Information - The company successfully completed the sale of several non-core assets, including the Sunset Media Center for $61 million and Kilroy Sabre Springs for $125 million, exceeding its goal for land parcel dispositions [12][13][14] - The anticipated yield at Kilroy Oyster Point Phase Two is now in the mid-5% range, approximately 100 basis points below the original underwriting [11] Q&A Session Summary Question: Can you discuss the UCSF anchor lease and its late commencement? - Management indicated that the UCSF lease is part of a new development project in shell condition, requiring time for build-out and space planning [34][35] Question: What are the retention expectations for the 1.05 million sq ft expiring in 2026? - Management expects substantial move-outs from this pool but has already backfilled about 140,000 sq ft and anticipates an additional 50,000-100,000 sq ft in potential renewals [50][51] Question: What is the competitive landscape for KOP and potential monetization? - Management remains committed to the long-term growth potential of KOP, emphasizing the value created in phase one and the strategic leasing efforts in phase two [76][77]

Financial Data and Key Metrics Changes - The company reported FFO of $0.97 per diluted share in Q4 2025, with occupancy ending the year at 81.6%, reflecting a 60 basis point sequential improvement [22][24] - Cash same-property NOI growth was negative 7.2% in Q4, primarily due to a sizable restoration fee recognized in Q4 2024, which detracted 350 basis points from current year growth [22][24] - The anticipated yield at Kilroy Oyster Point Phase Two (KOP2) is now in the mid-5% range, approximately 100 basis points below the original underwriting [10][24] Business Line Data and Key Metrics Changes - Fourth quarter leasing totaled approximately 827,000 sq ft, marking the strongest fourth quarter performance in six years, resulting in total full-year leasing of approximately 2.1 million sq ft, a significant year-over-year increase [3][4] - Key leasing highlights included a 93,000 sq ft new lease with the Fitler Club in Hollywood and a 316,000 sq ft lease with UCSF at KOP2, bringing the lease rate at KOP2 to 44% [4][6] Market Data and Key Metrics Changes - The company experienced the healthiest level of office demand since 2019, with a forward leasing pipeline that has grown by more than 65% over the last year [4][5] - In San Francisco, premium sublease space is virtually gone, indicating a positive sign for the market recovery [41][42] Company Strategy and Development Direction - The company is focused on driving leasing across its operating and development portfolios, monetizing non-core asset sales, and redeploying proceeds into select opportunities to enhance long-term growth [3][10] - The company plans to capitalize on the recovering leasing environment and improving capital markets, targeting $300 million in operating portfolio dispositions in 2026 [21][29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the leasing pipeline, indicating that the pipeline is about 65% higher than a year ago, with high confidence in getting tenants into occupancy over 2026 [49][50] - The company noted that the innovation pipeline remains exceptionally active, with more than 50 novel drug therapies anticipated to receive FDA approval in 2026, reflecting continued scientific advancement and investment [8][9] Other Important Information - The company successfully completed the sale of Sunset Media Center for $61 million and Kilroy Sabre Springs for $125 million, monetizing mature, capital-intensive assets [10][11] - The acquisition of Nautilus for $192 million strengthens the company's presence in the life science sector and positions it to capture cutting-edge lab and office demand [12][13] Q&A Session Summary Question: Inquiry about the UCSF anchor lease and its late commencement - Management clarified that the UCSF lease is part of a new development project currently in shell condition, requiring time for space planning and build-out [31][33] Question: Clarification on KOP2 yield and tenant improvements - The mid-5% yield is a cash stabilized yield, and all transactions signed to date have been reflected in the new cost estimates [37][38] Question: Update on leasing activity and competitive impact in San Francisco - Management noted that premium sublease space is nearly gone, and the recovery in San Francisco is evident with significant tenant activity and expansion-focused leases [41][42][80] Question: Retention expectations for expiring leases in 2026 - Management expects substantial move-outs from the 1.05 million sq ft of expiring leases, with progress already made in backfilling some of that space [48][49] Question: Market conditions and tenant space needs - Management indicated that new business formation and growth, particularly in AI, are driving demand for office space, with many tenants discussing expansion [78][79]

Financial Data and Key Metrics Changes - For Q4 2025, the company reported FFOA per share of $0.64 and full-year FFOA per share of $2.54, achieving the midpoints of previously provided guidance ranges [11][12] - Same-store revenue growth met guidance, while same-store expense and NOI growth results exceeded expectations [11][12] - The company repurchased approximately $93 million of common stock at a weighted average share price of $35.56, reflecting a sizable discount to NAV [13] Business Line Data and Key Metrics Changes - The acquisition of the Enclave at Potomac Club for $147 million is expected to outperform the market based on predictive analytics [12] - The company contributed four apartment communities to a joint venture, increasing its size to approximately $850 million [12] - The company anticipates blended lease rate growth of 1.5% to 2% in 2026, which is approximately 100 basis points higher than 2025 [21][22] Market Data and Key Metrics Changes - The company noted a slowdown in supply completions across its markets, which is expected to bolster growth [8][16] - The average rent-to-income ratio for residents remains below the long-term average, indicating affordability for rent increases [15] - The company expects a more muted job growth environment but anticipates continued demand due to high home prices and mortgage rates [14][15] Company Strategy and Development Direction - The company emphasizes a culture of innovation and data-driven decision-making to enhance shareholder value [6][7] - Ongoing investments in customer experience and AI tools are expected to drive incremental NOI growth [9][27] - The company plans to be a net seller of assets in 2026, actively marketing numerous apartment communities for sale [18][48] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the operating momentum achieved in late 2025 continuing into 2026, with expectations for high occupancy and lease rate growth [8][29] - The company is focused on optimizing occupancy and reducing turnover, with expectations for continued strong performance in key markets [38][81] - Management acknowledged potential regulatory risks but remains confident in the company's ability to navigate these challenges [72][74] Other Important Information - The company welcomed Ellen Goitia as a new board member, enhancing its governance expertise [9][10] - The company reported that its same-store revenue growth was at or above peer median across 13 of 14 markets shared with public peers in 2025 [30] Q&A Session Summary Question: Can you talk about your blended rate growth expectation for the full year? - Management noted that they are off to a better start than expected, with January's blended rate growth at about 1%, which is 50-75 basis points better than originally thought [32][34] Question: What are your thoughts on occupancy and retention? - Management emphasized efficiency in the turn process and expects to maintain occupancy around 96% while pushing for renewals in the 5% range [36][39] Question: Can you provide detail on the variance across your regions? - Management indicated stronger acceleration in the Sunbelt markets compared to coastal markets, with Dallas showing positive trends [41][42] Question: How much could you step on the gas on dispositions this year? - Management stated they are comfortable executing on a midpoint of dispositions while being mindful of tax gain capacity [46][48] Question: What factors will drive the contribution from other revenues in 2026? - Management expects mid-single-digit growth from initiatives like Wi-Fi and parking, with a focus on optimizing storage and pet rent [50][52] Question: What is your expectation for key coastal markets? - Management expects stronger performance in New York and San Francisco, while Boston and D.C. may not perform as well [78][81]

Financial Data and Key Metrics Changes - For the full year 2025, XPLR Infrastructure reported adjusted EBITDA of $1.88 billion and Free Cash Flow before growth of $746 million, reflecting strong cash flow-generating capabilities [5][17] - The adjusted EBITDA results were impacted by the absence of a $40 million one-time settlement payment from 2024 and asset dispositions, but were partially offset by improved pricing and lower operating costs [17] - The company expects adjusted EBITDA for 2026 to be between $1.75 billion and $1.95 billion, with Free Cash Flow before growth projected at $600 million to $700 million [18] Business Line Data and Key Metrics Changes - The company successfully simplified its capital structure by addressing over $1.1 billion in Convertible Equity Portfolio Financings (CEPF) and completed asset sales generating approximately $160 million in net proceeds [6][19] - XPLR has completed nearly 1.3 GW of its repowering plan, with projects achieving commercial operations on time and on budget [7] Market Data and Key Metrics Changes - XPLR's diversified portfolio of power generation assets is expected to benefit from increasing demand in U.S. power markets, with long-term contracts providing substantial cash flows [7][15] - Approximately 80% of the MWh sold are contracted at prices below current market prices, indicating potential for over $200 million in incremental revenue by 2040 as contracts mature [15] Company Strategy and Development Direction - The company is focused on capital allocation, simplifying its capital structure, and executing selected investments in energy infrastructure assets to maximize long-term value for unitholders [4][8] - XPLR is enhancing its portfolio value through a co-investment agreement with NextEra Energy Resources, monetizing surplus interconnection capacity and rights [9][10] - The company plans to increase its equity ownership in CEPF 5 and execute additional repowerings and battery storage projects, funded primarily by retained cash flows [23][24] Management's Comments on Operating Environment and Future Outlook - Management believes that long-term fundamentals for energy infrastructure assets are improving, and the strategy will enhance financial and strategic flexibility [7][9] - The company is positioned to capture future investment opportunities as market dynamics evolve, with a disciplined approach to capital allocation [15][24] Other Important Information - XPLR has reduced its corporate revolver from $2.5 billion to $1.25 billion, demonstrating discipline in aligning with funding needs [24] - The company has a strong liquidity position, with $750 million or less in corporate debt maturities over any 12-month period through 2030 [24] Q&A Session Summary Question: Capital allocation and potential for unit buybacks - Management indicated that retained cash flows will cover CEPF buyouts and investments, but did not commit to unit buybacks or distributions at this time [26][27] Question: Timing of battery storage projects - Battery storage projects are expected to reach commercial operations by the end of 2027, contributing to cash flows in 2028 and beyond [34] Question: Future opportunities with NextEra Energy Resources - Management clarified that there are no commitments beyond the announced transaction, focusing on the current capital plan [36][37] Question: Returns on battery investments versus repowerings - Management stated that repowerings target minimum double-digit returns, while battery investments are also expected to yield attractive returns [46][47]

Financial Data and Key Metrics Changes - For the full year 2025, XPLR Infrastructure reported Adjusted EBITDA of $1.88 billion and Free Cash Flow before growth of $746 million, reflecting strong cash flow-generating capabilities [5][17] - The 2025 Adjusted EBITDA was impacted by the absence of a $40 million one-time settlement payment from 2024 and asset dispositions, but was partially offset by improved pricing and lower operating costs [17] - The company expects 2026 Adjusted EBITDA to be between $1.75 billion and $1.95 billion, with Free Cash Flow before growth projected at $600 million to $700 million [18] Business Line Data and Key Metrics Changes - XPLR completed the sale of investments in the Meade Pipeline and certain distributed generation assets, generating approximately $160 million in net proceeds [6] - The company achieved a reduction of over $1.1 billion in third-party non-controlling equity interests through addressing two Convertible Equity Portfolio Financings (CEPF) [5][19] Market Data and Key Metrics Changes - XPLR's diversified portfolio of power generation assets is positioned to benefit from increasing demand in U.S. power markets, with expectations of significant embedded value and investment opportunities [15] - Approximately 80% of the megawatt-hours sold are contracted at prices below current market prices, indicating potential for over $200 million in incremental revenue by 2040 as contracts mature [15] Company Strategy and Development Direction - The company is focused on simplifying its capital structure and executing selected investments, particularly in wind repowering projects, to enhance financial and strategic flexibility [4][8] - XPLR is pursuing a capital allocation strategy that includes retaining cash flows to fund CEPF buyouts and selected investments, while maintaining balance sheet strength [8][24] - The company announced a co-investment agreement with NextEra Energy Resources to monetize surplus interconnection capacity and invest in battery storage projects, enhancing its portfolio [9][10] Management's Comments on Operating Environment and Future Outlook - Management believes long-term fundamentals for energy infrastructure assets are improving, particularly for those providing efficient, clean energy [7] - The company is positioned to capture future opportunities as market dynamics evolve, with a disciplined approach to capital allocation and investment [15][24] Other Important Information - XPLR has completed nearly 1.3 gigawatts of its repowering plan, with projects achieving commercial operations on time and on budget [7] - The company plans to increase its equity ownership in CEPF 5 with partial buyout investments of approximately $150 million in 2026 and $470 million in 2027 [23] Q&A Session Summary Question: Capital allocation and potential for unit buybacks - Management indicated that retained cash flows will cover CEPF buyouts and investments, with potential for about $1 billion available for investments and debt reduction over the next five years [26][28] Question: Update on CEPF 3 and asset sales - Management clarified that there is no change in the plan for CEPF 3, and options for asset sales remain open without urgency to exercise call options [29][30] Question: Timing for battery storage projects - Battery storage projects are expected to reach commercial operations by the end of 2027, contributing to cash flows in 2028 and beyond [34] Question: Future opportunities with NextEra - Management stated that there are no commitments beyond the current transaction with NextEra, focusing on the capital plan laid out [37] Question: Returns on battery investments versus repowerings - Management targets minimum double-digit returns for repowerings, while battery storage projects are expected to yield attractive returns as well [46][47]

Financial Data and Key Metrics Changes - For the full year 2025, XPLR Infrastructure reported an Adjusted EBITDA of $1.88 billion and Free Cash Flow before growth of $746 million, reflecting strong cash flow-generating capabilities [5][17] - The 2025 Adjusted EBITDA was impacted by the absence of a $40 million one-time settlement payment from 2024 and asset dispositions, but was partially offset by improved pricing and lower operating costs [17] - For 2026, the company expects Adjusted EBITDA to be between $1.75 billion and $1.95 billion and Free Cash Flow before growth to be between $600 million and $700 million [18] Business Line Data and Key Metrics Changes - The company successfully simplified its capital structure by addressing over $1.1 billion in Convertible Equity Portfolio Financings (CEPF) and completed asset sales generating approximately $160 million [5][19] - XPLR has completed nearly 1.3 gigawatts of its repowering plan, with projects achieving commercial operations on time and on budget [6] Market Data and Key Metrics Changes - XPLR's portfolio is positioned to benefit from increasing demand in U.S. power markets, with a focus on clean energy infrastructure [4][15] - Approximately 80% of the megawatt-hours sold are contracted at prices below current market prices, indicating potential for over $200 million in incremental revenue by 2040 [15] Company Strategy and Development Direction - The company is focused on capital allocation, simplifying its capital structure, and executing selected investments in energy infrastructure assets [4] - XPLR is enhancing its portfolio value through repowering projects and a new co-investment agreement with NextEra Energy Resources for battery storage projects [9][10] - The updated capital investment plan includes increasing equity ownership in CEPF 5 and adding battery storage capacity [23] Management's Comments on Operating Environment and Future Outlook - Management believes long-term fundamentals for energy infrastructure assets are improving, particularly for those providing efficient, clean energy [6][15] - The company is committed to maintaining balance sheet strength while advancing its capital simplification strategy [8][24] Other Important Information - XPLR has a strong liquidity position with a fully undrawn revolving credit facility and reduced corporate revolver size to $1.25 billion [24] - The company plans to fund its capital investments primarily through retained cash flows, supplemented by project-level financing [23] Q&A Session Summary Question: Capital allocation and potential for unit buybacks - Management indicated that retained cash flows will cover CEPF buyouts and investments, with incremental cash flow available for other uses [26][27] Question: Timing of battery storage projects - Battery storage projects are expected to reach commercial operations by the end of 2027, contributing to cash flows in 2028 and beyond [34] Question: Future opportunities with NextEra - Management clarified that there are no commitments beyond the announced transaction, focusing on current capital plans [35][37] Question: Returns on battery investments versus repowerings - Management stated that repowerings target minimum double-digit returns, while battery projects are also expected to deliver attractive returns [46]

Financial Data and Key Metrics Changes - In Q4 2025, revenues increased by 72.6% sequentially, primarily driven by growth in product revenue [16] - Gross margin for the quarter was 37.7%, impacted by provisions for slow-moving inventory; excluding these provisions, gross margin would have been approximately 43% compared to 42.4% in the prior quarter [16] - The company reported an IFRS net loss of $87.1 million in Q4, compared to a net profit of $900,000 in the prior quarter; on a non-IFRS basis, the net loss was $18.5 million, or $1.19 per ADS [18] Business Line Data and Key Metrics Changes - The IoT semiconductor business generated $7 million in revenue in Q4, with over 94% from product sales and roughly 6% from services [8] - For the full year 2025, total revenue was approximately $27.2 million, with an adjusted underlying business closer to $20 million [8] - The company expects to target approximately $40 million-$45 million of total global revenue in 2026, supported by a significant order backlog [8] Market Data and Key Metrics Changes - The revenue funnel exceeded $550 million in potential three-year product revenue, including over $300 million from design win projects, with 44% already in production [9] - The company is seeing strong demand in verticals such as smart metering, telematics, and asset tracking, with CAT-M and CAT-1 bus technologies driving growth [10] Company Strategy and Development Direction - The company remains focused on executing its IoT strategy and advancing its 5G product roadmap, aiming to unlock the full strategic value of the IoT business [5] - A disciplined approach to capital management includes right-sizing operating expenses and investing in key R&D programs [7] - The company is evaluating strategic alternatives to add profitability and unlock additional value across both the IoT business and its treasury strategy [14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the design win pipeline, with expectations for continued momentum and a path toward cash flow breakeven by the end of 2026 [21] - The company is addressing supply chain challenges, including substrate constraints and memory pricing pressures, while maintaining strong customer relationships [12] - Management anticipates little to no impact on business in the first half of 2026, with a focus on reducing cash burn and achieving breakeven [12] Other Important Information - The company repurchased approximately 9.7% of its outstanding ADSs in Q4 and has board authorization for an additional 10% buyback [6] - At year-end 2025, the company held 2,139 Bitcoin with a market value of $187.1 million, with 1,617 Bitcoin pledged as collateral for convertible debt [19] Q&A Session Summary Question: Guidance on licensing and design wins - Management indicated a conservative approach to licensing revenue, expecting around $5 million secured for the year, with 80%-85% of revenue from products and 15%-20% from services [26][28] Question: Break-even cash goal and operating expenses - Management targets a combined R&D and SG&A expense of around $10.5 million in the second half of the year, with expectations for cash flow breakeven [50] Question: Progress on 5G eRedCap chip - Revenue from the 5G eRedCap chip is expected around mid-2028, contingent on infrastructure readiness and customer engagement [52][55] Question: Customer receptiveness to price increases - Customers have been generally receptive to price increases, understanding the supply chain challenges and cost pressures [73] Question: Bitcoin treasury strategy and debt redemption - Management is evaluating options for debt redemption based on Bitcoin prices, with a preference for redeeming debt sooner rather than later if Bitcoin does not rally [78]