Financial Data and Key Metrics Changes - Overall net sales increased by 6% year over year to $1,060,000,000 for the quarter [4][21] - Adjusted EBITDA margins improved to nearly 18%, driven by strong gross margin performance and better operating leverage [5][24] - Gross profit margin rose to 39.3% compared to 37.6% in the prior year, primarily due to favorable pricing and lower input costs [23] Business Line Data and Key Metrics Changes - Residential product sales increased by 7% year over year to $574,000,000, driven by growth in energy storage systems and portable generator sales [21][22] - C and I product sales grew by 5% year over year to $362,000,000, supported by domestic industrial distributor and telecom shipments [22] - Sales in the Other Products and Services category increased by approximately 8% to $125,000,000, primarily due to growth in aftermarket service parts and Ecobee sales [22] Market Data and Key Metrics Changes - Domestic segment total sales increased by 7% to $884,000,000, including a 1% contribution from recent acquisitions [24] - International segment total sales also rose by approximately 7% to $197,000,000, benefiting from foreign currency [24] - The telecom market is expected to deliver robust growth for the full year 2025, driven by increasing reliance on wireless communications [16] Company Strategy and Development Direction - The company is focusing on expanding its dealer network, which increased to approximately 9,300 industrial dealers, enhancing consumer awareness for home standby products [9] - A new generation of home standby generators is set to launch, featuring improved efficiency and lower costs [10] - The company is committed to optimizing pricing strategies in response to evolving tariff landscapes while executing supply chain and cost reduction initiatives [6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth potential of the data center market, with a backlog of over $150,000,000 for large megawatt generators [19] - The company anticipates a challenging comparison for 2025 due to the absence of major outage events, but expects to maintain a baseline level of demand [11][32] - Management noted that the residential solar market is likely to contract, prompting a reevaluation of investment levels in solar technologies [15][62] Other Important Information - The company repurchased approximately 393,000 shares for $50,000,000 during the quarter, with $200,000,000 remaining on the share repurchase authorization [28] - Total debt outstanding at the end of the quarter was $1,400,000,000, resulting in a gross debt leverage ratio of 1.7 times [29] Q&A Session Summary Question: Update on the data center market entry - Management indicated that initial shipments to international markets will start in Q3, with domestic shipments expected late this year, but significant revenue impact is anticipated in 2026 [40][41] Question: Comments on Ecobee and solar market investment - Management acknowledged a potential contraction in the solar market but emphasized the importance of solar and storage technologies in the residential energy ecosystem [54][62] Question: Trends in home standby demand - Management noted that installations of home standby products are up year to date, with a robust dealer network supporting growth, despite lower outage activity in the first half of the year [85][86]