Financial Data and Key Metrics Changes - The company reported net sales of $1.5 billion for Q3 2025, reflecting a 1% year-over-year increase, with gross margin expanding by 50 basis points to 29.6% [3][19][20] - Diluted EPS increased by 4% to $3.40 from $3.27 in the same quarter last year [22] - Operating income improved by $2 million year-over-year, totaling $178 million for the quarter [22] Business Line Data and Key Metrics Changes - Maintenance product sales performed well, particularly in parts and private label chemical volumes, contributing to overall sales growth [6][9] - Building materials sales increased by 4%, driven by private label offerings and improved customer experience [9] - Equipment sales, excluding cleaners, also rose by 4%, primarily due to steady replacement volume for critical components [10] Market Data and Key Metrics Changes - Florida experienced 1% growth, while Texas remained flat, and California and Arizona each saw a 3% decline [7] - In Europe, net sales decreased by 1% in local currency but increased by 6% in U.S. dollars, with southern countries showing growth despite challenges in France [8] - Overall permit data was down mid-single digits year-over-year through August, indicating variability across regions [5] Company Strategy and Development Direction - The company shared a strategic roadmap focused on innovation and growth, with an emphasis on enhancing customer experience through technology [4][15] - Continued investment in the POOL360 technology suite is a key differentiator, with adoption rates increasing and contributing to sales growth [12][39] - The company aims to leverage its competitive advantages through strategic investments in people, facilities, and technology [16][55] Management's Comments on Operating Environment and Future Outlook - Management noted that uncertainty around tariffs and elevated borrowing rates are impacting consumer sentiment and discretionary demand [4][5] - Despite challenges, new pool construction sales have outperformed industry permit data, indicating market share expansion [5] - The company expects full-year sales performance to be relatively flat to slightly up, with diluted EPS guidance confirmed at $10.81 to $11.31 [14][24] Other Important Information - The company completed one acquisition during the quarter, adding two locations, and opened one new greenfield, bringing the total to six sales centers year-to-date [13] - The company generated $286 million in cash flows from operations year-to-date, down from $487 million in the prior year due to higher tax payments and investments in working capital [23] Q&A Session Summary Question: What is driving the early signs of stabilization in the market? - Management indicated that permit data is sporadic, but overall activity levels seem to have firmed up, supported by growth in building materials sales [31] Question: Can you elaborate on the investments in technology and expected trends? - Investments in technology are aimed at enhancing customer experience and productivity, with a focus on the POOL360 platform and other digital tools [33][39] Question: What are the implications of customer consolidation on margins? - Customer consolidation presents an opportunity for the company to leverage its technology suite to enhance efficiency and drive growth [43][44] Question: What is the outlook for chemical sales and pricing? - Management noted slight deflation in chemical prices, particularly in sanitizers, but overall chemical sales remain stable [50][51] Question: How does the company plan to manage SG&A expenses in the coming year? - The company expects SG&A growth to be in the range of 3% to 4%, reflecting investments in technology and new locations [74]