Financial Data and Key Metrics Changes - The company reported net sales of $1.2 billion for the third quarter, an increase of $211 million or 22% year-over-year [20] - Adjusted operating profit rose to $222 million, up $55 million or 33% from the previous year, with an adjusted operating profit margin of 18.8%, an increase of 150 basis points [21] - Adjusted diluted earnings per share increased to $5.12, up $0.97 or 23% compared to the prior year [21] Business Line Data and Key Metrics Changes - ABL (Acuity Brands Lighting) generated sales of $923 million, a $25 million or 3% increase year-over-year, driven by growth in independent sales and direct sales networks [21] - Acuity Intelligent Spaces (AIS) reported sales of $264 million, an increase of $188 million, with Atrius and Distech combined growing 21% and QSC growing over 20% year-over-year [25] Market Data and Key Metrics Changes - The company experienced accelerated orders in the third quarter, attributed to strategic pricing actions in response to evolving tariff policies [5][22] - The independent sales network and direct sales showed strong growth, while corporate accounts faced declines due to timing issues with a large retailer's renovations [21] Company Strategy and Development Direction - The company is focused on product vitality, service enhancement, and technology improvements to drive productivity and market share growth [18] - Acuity is entering new verticals, including refuel and healthcare, and is making strategic acquisitions to enhance its product offerings [110][111] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to manage outcomes amid uncertainties from tariff policies and geopolitical instability [17] - The expectation is that the combination of third and fourth quarter performance will meet the anticipated results for the second half of fiscal 2025 [62] Other Important Information - The company generated approximately $400 million in cash flow from operations year-to-date and has effectively allocated capital, including a 13% increase in dividends and share repurchases [27][28] - A special charge of $30 million was taken this quarter related to productivity efforts, which will yield benefits in future quarters [29][96] Q&A Session Summary Question: QSC margin performance - Management noted that QSC's margin improved significantly due to strong top-line growth and the adoption of productivity tools, with no deal accounting affecting the results [34][92] Question: Impact of accelerated orders and pricing actions - Management confirmed that there was evidence of order acceleration in both ABL and AIS, with expectations for normalized performance in the upcoming quarters [40][41] Question: Gross margin expectations for Q4 - Management indicated that while Q3 had minimal impact from tariffs, Q4 is expected to see some margin dilution due to tariff costs and pricing actions [58][60] Question: Demand environment and customer behavior - Management observed rational behavior from customers in response to pricing actions and tariff uncertainties, indicating a conservative approach to future expectations [97][99] Question: Progress on new verticals - Management highlighted strong traction in new markets such as refuel and healthcare, with ongoing efforts to enhance product offerings in these areas [110][111]

Financial Data and Key Metrics Changes - The company reported net sales of $1.2 billion for Q3 2025, an increase of $211 million or 22% year-over-year [21] - Adjusted operating profit rose to $222 million, up $55 million or 33% from the previous year, with an adjusted operating profit margin of 18.8%, an increase of 150 basis points [22] - Adjusted diluted earnings per share increased to $5.12, up $0.97 or 23% compared to the prior year [22] Business Line Data and Key Metrics Changes - ABL (Acuity Brands Lighting) generated sales of $923 million, a $25 million or 3% increase year-over-year, driven by growth in independent sales and direct sales networks [22] - Acuity Intelligent Spaces (AIS) reported sales of $264 million, an increase of $188 million, with Atrius and Distech combined growing 21% during the quarter [25] - QSC, part of AIS, grew over 20% year-over-year on a pro forma basis [25] Market Data and Key Metrics Changes - The company experienced accelerated orders in Q3 due to strategic pricing actions in response to evolving tariff policies, which contributed to building backlog [6][21] - The independent sales network and direct sales showed strong growth, while corporate accounts faced declines due to timing of renovations at a large retailer [22][24] Company Strategy and Development Direction - The company is focused on product vitality, elevating service levels, and using technology to improve operations and drive productivity [19] - Acuity is prioritizing investments in verticals where it has historically been underpenetrated, such as healthcare and sports lighting [9][100] - The strategy includes consolidating data management through Distech and Atrius, and enhancing user experiences with QSC [12][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to manage outcomes amid uncertainties from tariff policies and geopolitical instability [18][19] - The expectation is that the combination of Q3 and Q4 performance will yield the results anticipated for the second half of fiscal 2025 [18][59] - Management plans to approach future planning conservatively while remaining prepared to capitalize on market opportunities [39][90] Other Important Information - The company generated approximately $400 million in cash flow from operations year-to-date and allocated capital effectively, including a 13% increase in dividends and share repurchases [27][28] - A special charge of $30 million was taken in Q3 related to productivity efforts, which will yield benefits in future quarters [24][87] Q&A Session Summary Question: QSC margin performance - Management noted that QSC's margin improved significantly due to strong top-line growth and the adoption of productivity tools [33][35] Question: Impact of accelerated orders and pricing actions - Management confirmed that there was evidence of order acceleration in Q3, with expectations for normalized performance in Q4 [37][39] Question: Expectations for gross margin in Q4 - Management indicated that gross margin would likely be impacted by tariff costs in Q4, but they are confident in their ability to cover these costs [53][55] Question: Progress on shifting to Design Select - Management stated that progress on Design Select is strong, but it is a long-term project [71] Question: Demand environment and customer behavior - Management observed that customers are behaving rationally in response to pricing actions and tariff uncertainties, seeking stability in the marketplace [90]