Financial Data and Key Metrics Changes - In Q3 2025, net sales reached $285 million, a 22% increase from $234 million in Q3 2024, driven by growth across product ranges, particularly in railing [13] - Gross profit was $115 million, a 23.9% increase from $93 million, with a gross margin of 40.5%, up 60 basis points from 39.9% in the prior year [14] - Adjusted EBITDA increased by 33% to $90 million compared to $68 million in the previous year [15] - Year-to-date net sales for the first nine months of 2025 totaled $1 billion, a 3% increase from $984 million in the same period of 2024 [16] Business Line Data and Key Metrics Changes - New products accounted for 25% of trailing 12-month sales, up from 18% in the previous year, indicating strong alignment with consumer preferences [5] - Railing sales are tracking to double-digit year-on-year growth, with significant demand across the railing portfolio [9] Market Data and Key Metrics Changes - Consumer demand eased during the latter part of Q3, leading to revenues coming in 5% below the midpoint of guidance [5] - The company anticipates a muted fourth quarter, with sales guidance adjusted to $140-$150 million [18] Company Strategy and Development Direction - The company is focused on capturing a larger share of the conversion from wood to composite decking, with new product launches planned for 2026 [11] - Strategic investments in branding and marketing are prioritized to enhance consumer awareness and drive future growth [10] Management's Comments on Operating Environment and Future Outlook - Management noted that the current market conditions are challenging, with expectations of low single-digit growth in the repair and remodel industry [5] - The company remains confident in its long-term growth strategy, anticipating significant gains as R&R spending recovers [12] Other Important Information - The board of directors authorized a $50 million share repurchase program, reflecting confidence in the company's future [13] - The company expects SG&A spending to return to pre-COVID levels of approximately 18% of net sales [12] Q&A Session Summary Question: What was the sell-through in the third quarter? - Year-to-date sell-through was low single-digit, with a slowdown observed across all channels in August and September [24] Question: Why is the company increasing marketing spend and SG&A? - The increase is necessary to maintain brand visibility in a softer market and to counter competitive spending [26] Question: How does the company view early 2026 and the load-in ahead of decking season? - The company expects a robust early buy and is preparing to stage products for the upcoming season [31] Question: What is the outlook for pricing and cost? - The company took some pricing in Q2 but did not realize much during Q3, with expectations for low single-digit pricing growth [38] Question: How does the company view the conversion rate from wood to composite? - There is continued conversion from wood to composite, with effective strategies in place to attract consumers [45] Question: What are the expectations for SG&A spending in 2026? - SG&A is expected to return to around 18% of sales, reflecting a normalized marketing strategy [48] Question: How does the company plan to manage inventory levels? - The company anticipates ending the year with inventory levels similar to the end of 2024, with no significant increases expected [17] Question: What is the impact of competitors' marketing spend? - The company has not seen share shifts but recognizes the competitive landscape and the need to maintain marketing efforts [121]

Core Points - Trex Company, Inc. is the world's largest manufacturer of high-performance, low-maintenance composite decking and railing products [1] - The company will issue its third quarter 2025 earnings release on November 4, 2025, after the close of the U.S. market [1] - A conference call hosted by senior management will take place on November 4, 2025, at 4:30 PM ET, following the earnings release [1]

Core Insights - Trex Company has completed the 2025 Sunset Idea House in Palm Springs, showcasing its high-performance outdoor living products [1][2] - The project combines mid-century modern design with sustainability and innovation, featuring Trex's composite decking and railing systems [2][3] Product Features - Trex's Transcend Lineage composite decking includes SunComfortable™ technology, which reflects solar energy to keep surfaces cooler, beneficial in Palm Springs' climate with over 350 sunny days annually [3][6] - The decking is designed to resist stains, scratches, and mold, eliminating the need for sanding, staining, or sealing, and is easy to clean with soap and water [4][6] - The decking's Biscayne hue and natural woodgrain finish enhance the home's aesthetic, while Trex Signature X-Series Cable Rail maximizes views of the Coachella Valley [5][6] Sustainability Efforts - Trex's products are made from up to 95% recycled materials, diverting over 1 billion pounds from landfills annually, and the aluminum railing contains 40% recycled content [6][6] - The 2025 Sunset Idea House exemplifies eco-conscious design, aligning with Trex's commitment to sustainable living [6][6] Company Overview - Trex Company is the leading manufacturer of composite decking and railing, with a strong distribution network across over 6,700 retail outlets globally [9] - The company has received multiple accolades for sustainability and trustworthiness, including being named one of America's Most Responsible Companies and ranking on Barron's list of the 100 Most Sustainable U.S. Companies [9][9]