Financial Data and Key Metrics Changes - In fiscal 2025, net revenue grew 9% to $1.99 billion, with adjusted comp store sales increasing by 6% [7][41] - Adjusted operating income rose 56% to $102.5 million, with an AOI margin expansion of 160 basis points to 5.2% [7][41] - Fourth quarter net revenue increased 15.1% to $503 million, with adjusted operating income of $17.6 million and an AOI margin of 3.5% [8][40] Business Line Data and Key Metrics Changes - The number of exams performed by the doctor network increased, contributing to healthy profit expansion [6] - Managed care comp sales grew low double digits, with 42% of revenues attributable to managed care by the end of the year [10][11] - Average ticket growth was 6% for the year, driven by a shift towards more profitable customer cohorts [10][12] Market Data and Key Metrics Changes - Traffic declined 0.5% overall for the year, reflecting declines with self-pay customers, but strong traffic gains were seen with managed care and progressive customers [10][11] - The company experienced a positive shift in customer mix, attracting more profitable customers [10][11] Company Strategy and Development Direction - The company is focused on four growth vectors: expanding with underdeveloped customers, evolving product offerings, enhancing customer experience, and new store growth [9] - A significant pivot was made to attract a greater share of profitable customer cohorts, particularly those using insurance [11][12] - The company plans to introduce more premium lenses and frames, with a goal of increasing the mix of premium materials sold [18][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to continue expanding market share and improving profitability despite macroeconomic challenges [5][75] - The company anticipates continued strength in managed care customers and expects cash pay customers to comp positively in 2026 [53][56] - The outlook for fiscal 2026 includes expected net revenue between $2.03 billion and $2.09 billion, with adjusted operating income projected between $107 million and $133 million [45][46] Other Important Information - The company ended fiscal 2025 with a cash balance of $38.7 million and total liquidity of $332 million [42] - A new share repurchase authorization was approved for up to $50 million until December 28, 2030 [44] Q&A Session Summary Question: Concerns about the trade-off between growth from insurance customers versus traditional customers - Management noted that while there was some slowing in cash pay customers, managed care consumers remained strong, and there was optimism about cash pay customers participating in premium products [50][51][56] Question: Insights on net traffic between profitable target customers and traditional customers - Management indicated that there is a multi-year strategy to shift customer cohorts, focusing on acquiring more profitable customers while managing the transition from traditional cash pay consumers [63][66] Question: Projections for a softer end market and its impact on traffic - Management highlighted that despite industry declines, the company grew eye exams and maintained a strong brand presence, indicating resilience against macro challenges [75][76]