Financial Data and Key Metrics Changes - In Q4 2025, global sales from continuing operations totaled $3 billion, representing an 8% increase on a reported basis and a 3% increase on an operational basis [8][17] - Adjusted earnings from continuing operations were $0.44 per diluted share, which fell short of expectations despite exceeding top-line forecasts [8][17] - Adjusted gross margins from continuing operations were 35.5%, a decrease of 900 basis points compared to the prior year [25] - Adjusted operating margin from continuing operations was 11.8%, a decrease of 340 basis points compared to the prior year [26] Business Line Data and Key Metrics Changes - Medical Products and Therapies (MPT) segment sales were $1.4 billion, increasing 4% in the quarter, driven by growth in Infusion Therapies and Technologies [17][18] - Advanced Surgery products grew 11%, totaling $328 million, reflecting strong demand and commercial execution [10][19] - Healthcare Systems and Technologies (HST) sales totaled $827 million, increasing 4%, with Care and Connectivity Solutions growing 4% globally [20] - Pharmaceuticals segment sales were $668 million, increasing 2%, but the injectables and anesthesia division saw a decline of 9% [21][22] Market Data and Key Metrics Changes - U.S. capital orders for Care and Connectivity Solutions increased nearly 30% compared to the prior year, indicating strong demand in the market [20] - The company has not observed a slowdown in U.S. hospital capital spending, although broader macroeconomic uncertainty is being monitored [20] Company Strategy and Development Direction - The company is focused on three main priorities: stabilizing the business, strengthening the balance sheet, and driving a culture of continuous improvement [11][12] - A new operating model has been announced to simplify the organization, accelerate innovation, and improve performance by delayering leadership and embedding critical functional roles [12][60] - Innovation is emphasized as a critical element for success, with continued investment in R&D at or above historical levels [10] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges faced and emphasizes the need for improvement in performance and execution [9] - The outlook for 2026 anticipates total sales growth to be flat to 1% on a reported basis, with organic sales growth expected to be approximately flat [29][31] - The first quarter of 2026 is expected to be the most challenging, with improvements anticipated in the second half of the year [34] Other Important Information - Free cash flow generation exceeded $450 million in Q4 2025, with full-year free cash flow at $438 million [28] - The company plans to deploy cash towards reducing leverage in line with its capital allocation framework [28] Q&A Session Summary Question: Strategic review and sustainability of the business - Management emphasized the importance of accountability at lower levels and the need for continuous improvement to enhance performance [38][39] Question: Progress on reducing G&A and support costs - Management confirmed that they are on track with cost takeout and streamlining operations to meet demand, with a commitment to eliminate stranded costs by the end of 2027 [44][45] Question: Earnings growth as TSAs roll off - Management anticipates growth but has not provided specific guidance for 2027, as TSAs will tail off in early 2027 [48][49] Question: Q4 gross margin decline - Management attributed the decline to unfavorable sales mix, higher manufacturing costs, and non-recurring items, with expectations for improvement in the second half of 2026 [68][72] Question: Improving margins in the pharmaceuticals business - Management expressed confidence in the fundamentals of the pharmaceuticals business and outlined actions being taken to improve operational execution and address supplier challenges [76][78]

Financial Data and Key Metrics Changes - The company achieved record high revenue of $1.9 billion in 2025, reflecting a 3% growth year-over-year, with a group adjusted EBITDA of $319 million, or 17% of revenue [4][19] - In Q4, consolidated revenue was $411 million, flat compared to the previous year, with adjusted EBITDA of $45 million, or 11% of revenue [19][20] - Experiences segment revenue grew 10% to $204 million in Q4, while full-year revenue reached $924 million, also a 10% increase [23][28] Business Line Data and Key Metrics Changes - Marketplace businesses represented 61% of group revenue in 2025, with experiences expected to contribute over 50% of revenue and roughly 40% of adjusted EBITDA in 2026 [5][6] - TheFork segment revenue grew 18% in Q4 to $57 million, with full-year revenue of $221 million, representing a 22% increase [28][29] - Hotels and other segment revenue declined 15% in Q4 to $151 million, with a full-year decline of 8% to $750 million [29][30] Market Data and Key Metrics Changes - The experiences market is expected to grow by double digits over the next few years, with the online portion growing at 13% from 2019 to 2025 [8][47] - The company reported that repeat bookings are the fastest-growing cohort, comprising the majority of gross booking value (GBV) [24][12] - TheFork's B2B subscription revenue grew significantly, driven by the adoption of higher-priced premium plans by restaurants [16][28] Company Strategy and Development Direction - The company is focusing on becoming an experiences-first company, streamlining legacy offerings while exploring strategic alternatives for TheFork [6][7] - Plans include leveraging AI to enhance customer experience and optimize marketing efficiency, with a goal to simplify operations and improve profitability [14][18] - The company aims to extend its leadership in the experiences market globally and invest in capturing more market share [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth potential of the experiences market, citing strong demand signals and the ability to exceed market growth rates [47][50] - The company anticipates modest consolidated revenue growth in 2026, driven by a shift towards marketplace businesses, while facing headwinds in legacy segments [36][39] - Management highlighted the importance of repeat customers and the potential for increased profitability through improved marketing efficiencies [24][56] Other Important Information - The company repurchased 6.1 million shares in 2025, reducing share count by approximately 21% since the end of 2024 [34] - Operating cash flow for the full year was $245 million, with free cash flow of $163 million, reflecting strong cash generation capabilities [33] Q&A Session Summary Question: Can you characterize the incremental growth investments in the experiences business? - Management sees the experiences market as attractive and growing faster than other travel categories, with plans to invest in marketing to capture demand [46][47] Question: Regarding experiences margin expansion, why not focus on customer acquisition instead of margin? - Management emphasized the balance between growth and profitability, focusing on marketing efficiencies and repeat customer growth [54][56] Question: Can you elaborate on the AI native MVP launched in Q4? - The AI native MVP aims to enhance personalization and user engagement, leveraging user-generated content to build trust and improve conversion rates [64][68] Question: What are the economics behind traffic from large AI platforms compared to traditional SEO? - Management noted that AI-driven traffic tends to be higher intent, leading to stronger conversions, and they are excited about the growth potential in this area [70][72] Question: How is the geographic expansion for experiences being approached? - The company is focusing on building supply in new markets while also marketing North American experiences in new points of sale [76][80]

Financial Data and Key Metrics Changes - The company achieved a milestone of $3.8 billion in revenue for fiscal 2025, reflecting an 11% growth for the year, with organic growth at 6.9% [5][12] - Adjusted EBITDA grew by 10.8% to $854 million, while operating cash flow reached $678 million, and free cash flow was $650 million, up 11.6% and 12.1% respectively [12][13] - In the fourth quarter, revenue increased by 9.7%, with organic growth at 5.7% compared to the previous year [12][14] Business Line Data and Key Metrics Changes - Revenue from residential services increased by 9.7%, commercial pest control grew by 8.7%, and termite and ancillary services rose by 11.9% [14] - Organic growth in recurring revenue and ancillary services, which represent over 80% of total revenue, was above 7% for both the quarter and the year [6][14] - One-time business revenue declined by almost 3% in the fourth quarter, contrasting with a year-to-date growth of 4% through the first nine months [5][14] Market Data and Key Metrics Changes - Erratic weather patterns negatively impacted demand for one-time services, particularly in the Midwest and Northeast, leading to lower profitability [5][15] - The company noted that the stability of growth in recurring and ancillary areas provides confidence in the outlook, which is anchored to 7%-8% organic growth [15][22] Company Strategy and Development Direction - The company is focused on improving customer experience and investing in team development to drive organic growth and acquisitions [10][11] - A robust M&A pipeline is in place, with expectations of contributing 2%-3% growth from acquisitions in 2026 [10][80] - The company is committed to maintaining a strong investment-grade rating and a balanced capital allocation strategy, including dividends and share repurchases [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the underlying health of the consumer and the stability of customer retention rates [30] - The company anticipates that cash flow will continue to convert at a rate above 100% in 2026, despite potential weather impacts [23][88] - Management acknowledged the challenges posed by weather but emphasized the team's commitment to delivering results [66][88] Other Important Information - The company closed the acquisition of Saela and completed 26 additional tuck-in deals, with Saela's performance exceeding expectations [10] - The effective tax rate for the fourth quarter was 24.7%, down from 27.3% the previous year, due to improvements made by the tax team [18] Q&A Session Summary Question: Can you expand on the 7% growth in recurring and ancillary business? - Management highlighted strong customer retention and low rollback percentages, indicating a healthy consumer base [30][32] Question: How did weather disruptions impact different segments? - Management noted that the one-time business was significantly affected, particularly in residential and commercial sectors, while recurring revenue remained strong [38][42] Question: What is the margin profile of the one-time business? - The one-time business typically has a better margin profile than recurring services, contributing positively to overall results [47] Question: What are the expectations for Q1 relative to the rest of the year? - Management expects a slower start to the year due to weather impacts but remains confident in achieving 7%-8% organic growth for the year [50] Question: Any comments on the competitive environment? - Management stated that there have been no significant shifts in the competitive landscape, maintaining focus on internal improvements [57] Question: What are the opportunities in ancillary services? - Management emphasized the low penetration rate of ancillary services among customers and the potential for growth through cross-brand collaboration [68][71]

Financial Data and Key Metrics Changes - As of the end of Q4 2025, fee-paying assets under management (AUM) reached $29.4 billion, reflecting a 15% year-over-year increase [19] - Fee-related revenues (FRR) for 2025 were $297.3 million, a 13% increase from 2024, excluding direct and secondary catch-up fees [22] - Adjusted net income (ANI) for Q4 was $30.2 million, a 14% decrease from the previous year, primarily due to high catch-up fee revenue in Q4 2024 [26] Business Line Data and Key Metrics Changes - The company raised and deployed a record $5.1 billion in organic gross new fee-paying AUM in 2025, exceeding initial guidance by over $1 billion [11] - Private equity strategies raised and deployed $325 million, venture capital solutions raised and deployed $178 million, and private credit strategies added $338 million to fee-paying AUM in Q4 [24] - The average core fee rate was 109 basis points in Q4 and 104 basis points for 2025, with expectations of 103 basis points for 2026 [23] Market Data and Key Metrics Changes - The company has expanded its product set to meet investor demand for private markets, including launching its first evergreen product and a fund directed at European investors [13] - The acquisition of Qualitas Funds established the company's presence outside the U.S., complemented by the opening of a new office in Dubai [14] Company Strategy and Development Direction - The company aims to double fee-paying AUM to $50 billion by the end of 2029, primarily through organic growth [15] - The strategic acquisition of Stellus is expected to enhance direct lending capabilities and align with the company's focus on the middle and lower middle market [9] - The company is committed to returning capital to shareholders, having repurchased nearly 11 million shares since the beginning of 2024 [27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth trajectory and the potential for further expansion in the middle and lower middle market [18] - The company anticipates strong fundraising in 2026 and 2027, targeting at least $10 billion in gross fee-paying AUM [16] - Management highlighted the importance of strong fund performance and product innovation to sustain growth [12] Other Important Information - The company appointed two new independent directors to enhance governance and broaden its brand reach [14] - Operating expenses decreased in 2025 to $231.8 million from $235.8 million in 2024, reflecting adjustments related to prior acquisitions [25] Q&A Session Summary Question: AI's impact on private markets - Management noted a meaningful exposure to AI through its venture portfolio, with investments performing well, while maintaining modest exposure to SaaS and software [30][31] Question: Private markets wealth strategy - Management clarified that while private wealth was not a primary focus, they are leveraging existing products and partnerships, such as with CAIS, to enhance distribution in the private wealth channel [33][37] Question: Details on Stellus acquisition - Management indicated that Stellus's acquisition would be modestly accretive and that more detailed guidance would be provided closer to the closing date [41][42] Question: Stellus's sourcing funnel and growth acceleration - Management emphasized the strong fit between Stellus and the company's existing sponsor ecosystem, with plans to enhance sourcing and accelerate growth post-acquisition [49][52] Question: Capital management and M&A strategy - Management stated intentions to balance stock buybacks with debt reduction post-acquisition, while remaining focused on strategic M&A opportunities in private credit and real assets [55][58]

Financial Data and Key Metrics Changes - Adjusted company FFO for Q4 was $0.79 per diluted common share, totaling approximately $47 million, while the full year adjusted company FFO was $3.15 per diluted common share, or $187 million [14][15] - The company reduced leverage from 5.9 times to 4.9 times net debt to adjusted EBITDA and increased occupancy by 350 basis points to 97.1% [5][16] - Same-store NOI growth for the full year was 2.9%, with flat growth in Q4 compared to the same period in 2024 [16] Business Line Data and Key Metrics Changes - Nearly 5 million sq ft was leased in 2025, with attractive mark-to-market outcomes of approximately 28% on a cash basis, excluding fixed-rate renewals [5][7] - In Q4, over 2 million sq ft was leased with base and cash rental increases of approximately 27% and 23%, respectively, excluding fixed-rate renewals [7] - The company addressed roughly 3 million sq ft, or 41% of its total 2026 rollover, achieving an average cash rental increase of approximately 28% [7] Market Data and Key Metrics Changes - The company's target markets drove over 66% of the overall U.S. net absorption of about 54 million sq ft [6] - Larger users favored facilities exceeding 500,000 sq ft built within the last 5 years, with markets like Phoenix, Indianapolis, Fort Worth, and Houston leading demand [6][7] Company Strategy and Development Direction - The company plans to focus on disciplined investment and external growth opportunities, mainly in its land bank, while executing opportunistic share repurchases [10][12] - The development program has produced 15 facilities since 2019 with a 7.1% weighted average stabilized yield on first-generation leases [10] - A new 1 million sq ft spec project is set to break ground in Phoenix, with completion anticipated in the first half of 2027 and an estimated budget of $120 million [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about improving market fundamentals and the positive momentum associated with advanced manufacturing investments [12] - The company is focused on leasing remaining vacancies and generating robust mark-to-market outcomes in 2026 [12][24] - Management noted that while cash balances are currently weighing on earnings, liquidity is valuable for future opportunities [9] Other Important Information - The company exited five non-target markets in 2025, prioritizing investments in 12 target markets that account for 87% of gross book value [8] - Total disposition volume for the year was $389 million, including $116 million from non-target market sales in Q4 [8] - The company repaid approximately $220 million of debt in 2025, including $140 million of senior notes due 2028 [21][22] Q&A Session Summary Question: Inquiry about development plans in Phoenix - Management indicated that the supply-demand equation is favorable, and there is interest in the facility even before completion [26][27] Question: Clarification on same-store NOI growth - Management explained that the variance in same-store NOI growth was primarily driven by higher property expense leakage across several properties [32][34] Question: Discussion on transaction activity and capital allocation - Management noted that there are $200 million of assets in negotiations that could lead to good outcomes, which are not included in guidance [39][40] Question: Inquiry about cash same-store NOI guidance - Management clarified that the 3.25% contribution from contractual bumps and spreads is expected, with fixed-rate renewals potentially dragging down figures [44][46] Question: Comments on build-to-suit opportunities - Management expressed interest in the build-to-suit space, noting that the supply dynamics are encouraging, particularly in their land bank [56][57]

Financial Data and Key Metrics Changes - In 2025, the company achieved constant currency revenue growth of 8% year-over-year and adjusted EPS growth of 38% [5] - Adjusted EBITDA margin reached 20.7%, exceeding the 20% milestone a year ahead of plan, driven by strong cost discipline [14][16] - For the fourth quarter, adjusted EBITDA margin was 22.7%, a 420 basis point increase year-over-year, and adjusted EPS increased 35% year-over-year [18][20] Business Line Data and Key Metrics Changes - The logistics segment continued to deliver steady growth, with double-digit revenue growth driven by large e-commerce customers [25] - Packaging experienced high single-digit revenue growth, while consumer electronics saw double-digit growth as the market emerged from a down cycle [26][27] - Automotive revenue declined by high single digits, with expectations for flat to low single-digit growth in 2026 [27] Market Data and Key Metrics Changes - Americas revenue expanded by 11%, Europe grew by 13%, and Greater China revenue increased by 7% on a constant currency basis [19] - Other Asia revenue was flat, with growth from consumer electronics offset by declines in semiconductors [19] Company Strategy and Development Direction - The company is focused on leading in AI for industrial machine vision, with significant investments in new AI-enabled products and customer experience enhancements [5][8] - A comprehensive portfolio review is underway, with plans to exit low-margin product lines generating approximately $22 million in revenue [10] - The company aims to double its customer base within five years, having acquired approximately 9,000 new customer accounts in 2025 [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a 25% adjusted EBITDA margin by the end of 2026, supported by ongoing cost reductions and operational efficiencies [16][30] - The company remains cautious about macroeconomic conditions but is optimistic about growth in logistics and consumer electronics [25][30] Other Important Information - The company generated $237 million in free cash flow in 2025, the highest since 2021, with a trailing twelve-month free cash flow conversion rate of 138% [23][24] - A $500 million increase in the share repurchase authorization was approved, reflecting the company's commitment to returning capital to shareholders [24] Q&A Session Questions and Answers Question: Can you provide details on the $22 million revenue divestments? - The majority of the revenue being exited is related to a Japan-focused trading business, expected to close by the end of the year or within the second quarter, impacting the packaging and logistics verticals [35][36] Question: How does the company determine core versus non-core products? - The company evaluates core products based on core IP, market size, growth potential, and profitability, focusing on areas where it has a competitive advantage [39][40] Question: What are the offsets for the cost reduction program in 2026? - The primary offset is on the mix side, with favorable one-time effects in 2025 not expected to recur, while operational efficiency remains the largest lever for margin expansion [46] Question: What has changed in customer growth initiatives over the past year? - Significant improvements in salesforce transformation, including better organization, processes, and collaboration with partners, have driven customer acquisition and flexibility in targeting high-growth areas [48][49] Question: What is the outlook for organic top-line growth in 2026? - The company expects mid to high single-digit organic growth, with ongoing monitoring of macroeconomic indicators to adjust expectations as necessary [56][58] Question: Can you elaborate on the demand trends in consumer electronics and logistics? - Consumer electronics demand is driven by new AI features and supply chain shifts, while logistics continues to see strong growth, although moderation is expected after a period of outsized growth [68][69]

Financial Data and Key Metrics Changes - In 2025, Cognex achieved a return to profitable growth with constant currency revenue growth of 8% year-over-year and adjusted EPS growth of 38% [6][24] - The adjusted EBITDA margin reached 20.7%, exceeding the 20% milestone a year ahead of plan, driven by strong cost discipline [15][17] - For the fourth quarter, adjusted EBITDA margin was 22.7%, marking a 420 basis point increase year-over-year [19] Business Line Data and Key Metrics Changes - Logistics continued to show steady growth, contributing to the overall revenue increase, with double-digit growth driven by large e-commerce customers [26] - The packaging segment delivered high single-digit revenue growth, indicating a strong market position [27] - Consumer electronics revenue grew double digits, supported by supply chain shifts and new device form factors [26] Market Data and Key Metrics Changes - Revenue from the Americas expanded by 11%, driven by strong demand in packaging and logistics [20] - Europe saw a 13% revenue growth, primarily due to strength in packaging [20] - Greater China revenue increased by 7%, supported by growth in consumer electronics and semiconductors [20] Company Strategy and Development Direction - Cognex is focused on leading in AI for industrial machine vision, with significant investments in new AI-enabled products [6][9] - The company aims to double its customer base within five years, having acquired approximately 9,000 new customer accounts in 2025 [10] - A comprehensive portfolio review has led to exiting low-margin product lines, with an expected annualized cost reduction of $35 million to $40 million by year-end 2026 [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing transformation of the operating model and disciplined cost management as key drivers for future growth [31] - The company anticipates moderate growth in logistics for 2026, following two years of outsized growth [26] - Management remains cautious about the macroeconomic environment but is optimistic about the company's strategic positioning and customer acquisition momentum [31] Other Important Information - Cognex generated $237 million in free cash flow in 2025, the highest since 2021, with a trailing twelve-month free cash flow conversion rate of 138% [24][25] - The company returned $206 million to shareholders in 2025, including $151 million in share repurchases [25] Q&A Session Summary Question: Timing and impact of the $22 million revenue divestments - The majority of the revenue exiting is related to a Japan-focused trading business, expected to close by the end of the year or within the second quarter, impacting the packaging and logistics verticals [36][37] Question: Determining core versus non-core products - The company defines core products based on core IP, market size, growth potential, and profitability, focusing on areas where they have a competitive advantage [40][41] Question: Cost reduction program for 2026 - The largest lever for EBITDA margin expansion is OpEx efficiency, with expected offsets primarily on the mix side [46][47] Question: Customer growth initiatives and market outgrowth - The sales force transformation has significantly improved customer acquisition, with flexibility to redirect sales activities based on market conditions [50][51] Question: Organic top-line assumptions for 2026 - The company is not providing full-year guidance but expects mid to high single-digit growth based on current data [58] Question: Update on capital allocation priorities - Capital allocation priorities remain unchanged, focusing on strong cash flow generation and maintaining a cash conversion cycle of 150 to 155 days [72][73]

Financial Data and Key Metrics Changes - Total revenue for Q4 2025 declined by 2.3% year-over-year, with full year revenue at approximately $8.6 billion [4][9] - Adjusted EBITDA grew nearly 8% year-over-year to just over $900 million, marking the first quarter of year-over-year adjusted EBITDA growth in 16 quarters [6][24] - Adjusted EBITDA margin expanded to over 41%, up 380 basis points year-over-year, while gross margin reached approximately 70%, up 180 basis points [6][24] Business Line Data and Key Metrics Changes - Broadband subscriber results showed a net loss of 62,000 subscribers in Q4, ending the year with 4.2 million broadband subscribers [17] - Fiber customer accounts grew by 33% year-over-year, reaching 716,000, with 12,000 net additions in Q4 [17][18] - Mobile lines reached 623,000, representing 35% year-over-year growth, with a net addition of 38,000 lines in Q4 [18] - Video subscribers decreased by 13% year-over-year, with a net loss of 49,000 in Q4, although this was the lowest quarterly loss in over five years [20] Market Data and Key Metrics Changes - Connectivity and all other revenue grew by 2% year-over-year, supported by mobile revenue growth of over 40% and business services growth of over 8% [22] - Residential ARPU grew by 0.4% to $134.49, with broadband ARPU increasing by 2.8% year-over-year to $76.71, the highest in 14 quarters [23][24] Company Strategy and Development Direction - The company is focused on simplifying operations to enhance customer and employee experiences, with priorities including improving broadband trajectory and maintaining financial discipline [10][11] - Investments in AI and automation are being leveraged to improve operational efficiency and customer service [12][13] - The company aims to balance capital expenditures with long-term economics, emphasizing fiber expansion and targeted network upgrades [15][16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the hypercompetitive environment and emphasized the importance of disciplined execution and operational improvements made in 2025 to support long-term EBITDA stability [40][41] - The company is optimistic about its ability to improve broadband trends and customer retention through new pricing and product strategies [38][39] Other Important Information - Cash capital expenditures for the full year totaled approximately $1.3 billion, with a capital intensity of less than 16%, the most efficient in the last four years [27][28] - Lightpath revenue reached $468 million in 2025, representing 13% growth year-over-year, driven by demand from hyperscale customers [29] Q&A Session Summary Question: Update on broadband subscribers and expectations for 2026 - Management noted that Q4 faced unprecedented competitive pressures but emphasized foundational work done in 2025 to improve market positioning and customer experience [36][38] Question: Balance sheet update and debt management - Management highlighted the importance of a strong capital structure and mentioned recent debt refinancings to enhance liquidity and financial flexibility [45][46] Question: Strength of residential broadband ARPU - Management reported a 0.4% year-over-year growth in residential ARPU, driven by broadband and mobile services, despite video headwinds [50][51] Question: Expectations around video programming costs - Management indicated a focus on renegotiating programming costs, achieving a 16% reduction in the quarter, and emphasized a disciplined approach to pricing and packaging [56][57] Question: Competitive landscape and market pressures - Management described the competitive environment as intense, particularly in the East with significant fiber overbuild, but expressed confidence in their product offerings and pricing strategies [65][66]

Financial Data and Key Metrics Changes - For the full year 2025, the company delivered comparable sales growth of 2.4%, net restaurant growth of 2.9%, and system-wide sales growth of 5.3% [31][32] - Organic adjusted operating income growth was 8.3%, and nominal adjusted EPS growth was over 10% [7][30] - The company achieved its third consecutive year of approximately 8% organic adjusted operating income growth, demonstrating consistency within the industry [7][49] Business Line Data and Key Metrics Changes - Tim Hortons, which represents roughly 42% of operating profit, delivered comparable sales growth of 2.8% in Canada, outperforming the broader Canadian QSR industry [10][14] - The international segment, contributing about 27% of operating profit, saw comparable sales growth of 4.9% and net restaurant growth of 4.9%, driving system-wide sales growth of nearly 11% [14][15] - Burger King U.S. achieved comparable sales growth of 1.6% for the full year, including 2.6% in the fourth quarter [20][24] - Popeyes experienced a net restaurant growth of 1.6% but faced a decline in comparable sales of 3.2% for the year, resulting in system-wide sales growth of -0.7% [25][28] Market Data and Key Metrics Changes - In the international markets, particularly in Europe and Asia Pacific, the company benefited from structural growth and positive same-store sales, with notable performance in France and Japan [62][66] - Burger King China reported a 9.2% growth in comparable sales, driven by improvements in restaurant fundamentals and a new joint venture with CPE [16][17] Company Strategy and Development Direction - The company is focused on long-term investments and operational improvements, with a goal to return to a 99% franchise business model [9][30] - The strategy includes refranchising efforts at Burger King U.S. and expanding the restaurant footprint in China [6][30] - The upcoming Investor Day on February 26 will address the company's growth algorithm and plans for net restaurant growth [9][30] Management's Comments on Operating Environment and Future Outlook - Management noted that 2025 was a challenging year due to elevated costs and macroeconomic pressures, but the fundamentals of the business showed resilience [44][46] - The company expects to ramp back towards 5% unit growth by the end of the growth algorithm period, with a positive outlook for 2026 [32][40] - Management expressed confidence in the ability to build on the momentum from 2025, emphasizing the importance of franchisee profitability and operational consistency [30][44] Other Important Information - The company generated nearly $1.6 billion of free cash flow in 2025 and returned $1.1 billion of capital to shareholders through dividends [36][37] - The total liquidity at year-end was approximately $2.4 billion, with a net leverage ratio of 4.2x [37] Q&A Session Summary Question: Can you discuss the comparable sales evolution and trajectory in 2026, particularly for Tim Hortons and Burger King? - Management indicated that the strong performance in 2025 sets a positive foundation for 2026, with expectations for a similar consumer environment and continued focus on fundamentals [53][54] Question: How much of the international momentum is driven by a healthier backdrop versus share gains? - Management responded that the momentum is a combination of a supportive market backdrop and effective local strategies, with strong performance in various international markets [60][63] Question: Can you summarize the performance in developed markets, particularly Europe? - Management highlighted consistent positive performance across major Western European markets, with strong results in Turkey and a healthy business in Canada [71][72]

Financial Data and Key Metrics Changes - AMG reported full-year economic earnings per share of $26.05, a 22% increase year over year, driven by strong organic growth and capital allocation strategy [4][27] - Adjusted EBITDA for the fourth quarter was $378 million, growing 34% year over year, while full-year Adjusted EBITDA reached $1.1 billion, up 11% from 2024 [25][26] - Economic earnings per share for the fourth quarter were $9.48, reflecting a 45% year-over-year growth [27] Business Line Data and Key Metrics Changes - AMG's affiliates generated approximately $29 billion in annual net client cash flows, representing an organic growth rate of 4% [4] - The company added approximately $97 billion in alternative assets under management (AUM), a 35% increase, with $74 billion in net inflows from existing affiliates and $23 billion from new partnerships [5][11] - Fee-related earnings grew 20% year over year for the fourth quarter and 8% for the full year, driven by investment performance and organic growth [26] Market Data and Key Metrics Changes - AMG's alternative AUM reached $373 billion, contributing approximately 60% of EBITDA on a run rate basis [9] - In liquid alternatives, AMG posted record net inflows of $51 billion for the year, representing a 36% annualized organic growth rate [17] - Private markets affiliates raised $24 billion in total for the year, with an annualized organic growth rate of 18% [18] Company Strategy and Development Direction - AMG's strategy focuses on expanding its footprint in private markets and liquid alternatives, with a commitment to high-quality affiliate partnerships [6][12] - The company aims to continue investing in areas of secular growth and product innovation to enhance affiliate success and drive organic growth [12][36] - AMG plans to repurchase at least $400 million in shares in 2026, reflecting its commitment to returning capital to shareholders while pursuing growth investments [35] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term prospects of the business, highlighting the strong momentum entering 2026 [13][36] - The company anticipates ongoing growth from existing affiliates, particularly AQR and Pantheon, which are expected to contribute significantly to earnings [30][31] - AMG's reputation and capital flexibility are at an all-time high, positioning the company well for future opportunities [13] Other Important Information - AMG repurchased approximately $700 million of its shares in 2025, representing 11% of shares outstanding [5][24] - The company announced a new partnership with Highbrook and a follow-on investment in Garda, both expected to be accretive to earnings in 2026 [7][35] - AMG's global wealth AUM now totals over $100 billion, growing organically at more than 100% in 2025 [23] Q&A Session Summary Question: Outlook for AQR in 2026 - Management noted that AQR is expected to be a more meaningful contributor in 2026, with strong organic growth and diverse flows across various strategies [38][66] Question: Pipeline for Private Markets in 2026 - Management highlighted Pantheon’s expertise in secondaries and the ongoing innovation in private markets products, which are expected to drive growth [47][49] Question: Growth in Global Wealth Management - Management acknowledged significant growth in the U.S. wealth management platform while also recognizing opportunities for growth outside the U.S. [57][60] Question: Performance Fees Outlook - Management indicated that AQR was a double-digit contributor to EBITDA in 2025 and is expected to grow further in 2026, with a stable and predictable earning stream from performance fees [64][68]