Core Insights - The company is well-positioned for long-term growth with the largest subscription base in the industry, strong unit economics, and a history of innovation [1][4][10] Expansion and Market Position - The company opened five new Greenfield locations, increasing the total store count to 527 across 21 states, and celebrated the grand reopening of a flagship store in Tucson [1][4] - The expansion in the market has more than doubled the company's market share, enhancing customer convenience and choices [2] - The company successfully acquired five stores in Lubbock, Texas, strengthening its market position [3][25] Financial Performance - Revenue increased by 6% to $263 million, with adjusted EBITDA rising 10% to $87 million, marking the highest Q3 EBITDA margin ever reported at 32.9% [4][21] - Comparable store sales grew by 3.1%, marking the tenth consecutive quarter of comp gains, with UWC (Unlimited Wash Club) members increasing by 6% year-over-year to approximately 2.2 million [4][12] - The company achieved a 4% year-over-year increase in Express revenue per member, driven by base membership price increases and a shift towards higher-tier memberships [19][22] Innovation and Customer Experience - The Titanium 360 tier reached approximately 25% penetration of the total membership base, indicating strong adoption and retention trends [3][12] - The company is committed to innovation, focusing on improving service quality and introducing proprietary services to differentiate from competitors [5][6] Marketing and Growth Strategy - The company plans to increase marketing investments in Q4 to build a scalable growth engine for 2026 and beyond [7][8] - The marketing tests conducted in Q2 showed promising results, leading to an expansion of the testing program in select markets [7][8] Future Outlook - The company is on track to open approximately 30 new stores in 2025, with a long-term goal of over 1,000 locations across the U.S. [5][26] - Full-year revenue is expected to land near the high end of the guidance range of $1.046 billion to $1.054 billion, incorporating new store openings and marketing test contributions [28][29]

Financial Data and Key Metrics Changes - Revenue increased by 6% to $263 million and adjusted EBITDA rose by 10% to $87 million, marking the highest Q3 EBITDA margin ever reported at 32.9% [4][19] - Comparable store sales growth was 3.1%, representing the 10th consecutive quarter of comp gains [4][12] - Adjusted EPS increased by 38% year over year to $0.11 [12] Business Line Data and Key Metrics Changes - UWC (Unlimited Wash Club) membership grew by 6% year over year, reaching approximately 2.2 million members, with the Titanium 360 tier achieving about 25% penetration of the total membership base [4][17] - UWC sales represented 77% of total wash sales, with UWC comps increasing in high single digits [16][17] - Retail comps performed in line with expectations, showing a low double-digit decrease [16] Market Data and Key Metrics Changes - The pace of new competitor openings has moderated, with an estimated 40% fewer new builds year to date compared to the previous year, contributing to a healthier competitive environment [14] - Locations facing competition less than a year old comped down low single digits, while those with competition older than two years or no competition comped up mid to high single digits on average [15] Company Strategy and Development Direction - The company is focused on expanding its footprint, with plans to open approximately 30 new stores in 2025, in addition to five recently acquired stores in Lubbock, Texas [7][24] - Strategic M&A opportunities are anticipated as the industry consolidates, with a belief that the market is entering a healthier phase [6][11] - Innovation remains a core focus, with ongoing investments in technology and R&D to differentiate the brand [8][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strength of the markets and the resilience of the business model, indicating a favorable setup for future growth [26] - The company is actively managing variability in retail performance and capitalizing on M&A opportunities to fuel growth [11][26] - There is confidence in the ability to accelerate growth moving forward, supported by a strong subscription base and unit economics [7][11] Other Important Information - Free cash flow for the nine months ended September 30 was $202 million, compared to $174 million in the same period last year, representing 26% of sales [23] - The company has reduced its total outstanding debt by more than $100 million over the last 12 months, with a leverage ratio of 2.4 times adjusted EBITDA [20][23] Q&A Session Summary Question: Where did the sales upside materialize in Q3? - Management noted that all months in Q3 were positive, with July being the strongest due to a softer comparison [28][29] Question: What is the pecking order of cash flow usage? - The company indicated that Greenfield development remains the highest use of capital, with options for share buybacks and debt pay down being considered [31][32] Question: How does the base price increase impact 2026? - The base price increase rollout is expected to contribute roughly a quarter to one-third of its total impact in 2026 [36][37] Question: Can you provide insight into membership trends? - Membership has been relatively flat sequentially, with a focus on increasing retail traffic to convert more customers into members [41][42] Question: What is the competitive response to marketing tests? - There have been no unusual competitive responses noted in the markets where marketing spend has been tested [79]