Financial Data and Key Metrics Changes - Total operating income for Q2 2025 was $967 million, reflecting a 97% year-over-year growth, driven by significant unmet needs in MG and CIDP [13][14] - Product net sales were $949 million, with a quarter-over-quarter growth of 19% or $158 million compared to Q1 2025 [13][14] - The gross to net ratio increased from 12% in 2024 to approximately 20% by the end of Q2 2025 [16][75] - The company reported a profit after tax of $245 million for the quarter, with a year-to-date profit of $415 million [20] Business Line Data and Key Metrics Changes - Plinab achieved a remarkable year-over-year growth of 97% across all approved indications [4] - The company is treating 15,000 patients globally with Vipcart, including 2,500 CIDP patients just one year post-launch [5] - The introduction of the prefilled syringe (PFS) has driven new patient starts and prescriber demand, with 50% of PFS patients being new to the product [24] Market Data and Key Metrics Changes - In the U.S., product net sales reached $802 million, with an 18% quarter-over-quarter growth [14][15] - The contribution from non-U.S. markets now represents over 15% of global product net sales, indicating successful expansion [14] - The company is seeing strong growth in Japan and Germany, with both markets off to a fast start following recent launches [61] Company Strategy and Development Direction - The company’s Vision 2030 roadmap aims for long-term value creation, with a focus on expanding labeled indications and advancing a robust late-stage pipeline [4] - The strategy includes a commitment to innovation, with multiple registrational trials initiated in large market opportunities [4][6] - The company is expanding its immunology innovation platform, with four new molecules in Phase I studies targeting high unmet needs [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth potential within MG and CIDP, emphasizing the transformative impact of their treatments [30] - The company anticipates data from six Phase III and six Phase II trials over the next eighteen months, which could unlock new patient populations [31] - Management acknowledged the competitive landscape but remains committed to leading through innovation and maintaining high treatment standards [56] Other Important Information - The company has a strong cash position of $3.9 billion, up from $3.4 billion at the beginning of the year, primarily driven by operating cash flow [20][88] - The effective tax rate for the year to date is reported at 15% [19] Q&A Session Summary Question: How have your cycles per year in MG evolved? - Management confirmed that net revenue per patient remains consistent despite a higher gross to net ratio, with no price increases in 2025 [36][37] Question: Can you provide a breakdown of the PFS switches between Hytrula and IV? - Management indicated that Hytrulo is driving the majority of growth, with 50% of PFS patients being new to the product [42] Question: How much of the gMG patient adds were due to the prefilled syringe? - Management noted that the prefilled syringe significantly contributed to patient growth, with a strong prescriber base established [47] Question: What are your thoughts on increasing competition? - Management acknowledged the competitive dynamics but emphasized their commitment to innovation and maintaining leadership in the market [56] Question: Can you comment on the CIDP launch and patient dynamics? - Management reported strong growth in CIDP, primarily from IVIG switches, and noted that they are still early in the launch curve [68][70] Question: What is the outlook for gross margin? - Management expects gross margin to remain around 11%, with offsetting factors affecting cost of sales [66] Question: Can you provide an update on the FDA spares update from June? - Management stated that they are monitoring the situation and have not observed a significant change in the benefit-risk ratio [98][100]

Financial Data and Key Metrics Changes - Core FFO per share increased by 5.4% year over year, reaching $0.26 for the quarter and $0.51 for the six months [9][25] - Same store NOI growth was 2.5% for the quarter and 3.9% for the six months, with a target range of 3% to 4.5% for the year [9][10][25] - Occupancy rose by 100 basis points sequentially from Q1 to 93.9% [4][5] Business Line Data and Key Metrics Changes - The company signed $33.2 million in total lease value, slightly up from Q1, with leasing spreads of 41.4% for new leases and 15.2% for renewals, resulting in a combined leasing spread of 17.9% for the quarter [13][25] - The addition of new tenants, such as Ace Hardware and the Pickler, is expected to enhance same store NOI growth in the future [5][14] Market Data and Key Metrics Changes - The company is focusing on high-growth Sunbelt markets, which are experiencing strong leasing environments [4][5] - Significant urban developments are occurring around the company's properties, such as the $1 billion Park 8 Place redevelopment in Houston and TSMC's $165 billion investment in Phoenix [9][20][19] Company Strategy and Development Direction - The company aims to leverage its leadership position in the high-value shop space to achieve core FFO growth of 5% to 7% and same store NOI growth of 3% to 5% [4][9] - Strategic acquisitions, such as San Clemente in Austin and South Hewlett in Fort Worth, align with the company's criteria for growth and neighborhood dynamics [6][8][21] - The company is committed to capital recycling, with an estimated $40 million in acquisitions and dispositions planned for the remainder of the year [11][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving future same store NOI growth due to strong leasing activity and tenant mix improvements [32][33] - The company is actively managing expenses, reducing G&A and interest expenses by about 6% from the previous year [11][28] - Management reiterated guidance for core FFO per share and year-end occupancy, indicating strong momentum heading into the second half of the year [25][26] Other Important Information - The company has a strong liquidity position with $5.3 million in cash and $69 million available under the credit facility [28] - The company is focused on maintaining a dividend payout of approximately 50% of FFO, with plans to grow the dividend in line with earnings growth [28] Q&A Session Summary Question: Concerns about same store comps in upcoming quarters - Management expressed confidence in meeting forecasts due to improved occupancy and leasing activity contributing to future same store NOI growth [30][32] Question: Impact of new tenants on same store NOI - Management indicated that new tenants like the Pickler will commence in the second half of the year, contributing minimally to same store NOI this year but expected to enhance future growth [34] Question: Details on acquisitions and dispositions - Management confirmed ongoing activities related to $40 million in acquisitions and dispositions, emphasizing the importance of capital recycling [35][36] Question: Interest expense forecast changes - Management clarified that the increase in interest expense is due to timing related to acquisitions and is expected to be offset by increased non-same store NOI [39] Question: Insights on recent acquisitions - Management highlighted the quality of neighborhoods and potential for rent increases in the recent acquisitions, indicating strong upside opportunities [42][43] Question: Cap rates and market pricing trends - Management noted stability in cap rates for recent acquisitions, with a focus on asset-specific evaluations rather than broad market trends [52][53] Question: Same store growth guidance and leasing activity - Management confirmed that the guidance is based on normal leasing activity, with a mix of routine leasing and larger spaces that will contribute to future growth [60][62]

Financial Data and Key Metrics Changes - Gross billings increased by 39% to $500.6 million compared to $359.8 million in the prior year quarter [13] - Net sales rose by 73% to $159.3 million from $92.1 million, driven by organic growth and contributions from the acquisition of Douglas Stewart Software (DSS) [13] - Net income increased by 74% to $6 million or $1.3 per diluted share, compared to $3.4 million or $0.75 per diluted share in the previous year [14] - Adjusted EBITDA grew by 64% to $11.4 million, with an effective margin increase of 600 basis points to 43.3% [15][16] Business Line Data and Key Metrics Changes - Distribution segment gross billings increased by 40% to $477 million, while solutions segment gross billings rose by 19% to $23.5 million [13] - The acquisition of DSS contributed significantly to the growth, particularly in the education sector as schools prepare for the new academic year [6][14] Market Data and Key Metrics Changes - The company experienced double-digit organic growth in both the US and Europe, indicating a strong market presence [6] - The company evaluated 50 potential vendor partnerships in Q2, moving forward with four, reflecting a disciplined approach to vendor selection [7] Company Strategy and Development Direction - The company is focused on building momentum from the first half of the year by executing strategic priorities, including exploring M&A opportunities that align with long-term vision [12][13] - The appointment of new executives, including a Chief Information Officer and a President of North America, aims to enhance leadership and drive growth [10][11] Management's Comments on Operating Environment and Future Outlook - Management does not foresee economic headwinds affecting business growth, citing a robust pipeline of vendors and continued investment in the IT market [55] - The company remains optimistic about its growth potential, viewing itself as a small player in a large market with significant room for expansion [40][41] Other Important Information - Cash and cash equivalents were $28.6 million as of June 30, 2025, with a working capital increase of $12.2 million during the period [17] - The Board of Directors declared a quarterly dividend of $0.17 per share, payable on August 15, 2025 [17] Q&A Session Summary Question: Did security and data center continue to lead growth in the quarter? - Yes, security and data center remain the top growth areas, with security being the stronger segment [20][21] Question: How did the top 20 vendors perform? - Some vendors in the bottom tier are lagging, but others are performing well, with new entrants expected to impact the second half of the year positively [22] Question: Were there any large deals that contributed to this quarter's strength? - A significant order was pulled into Q2 from Q3, contributing to the strong performance, but organic growth remained robust [25] Question: Are there meaningful synergies from the Douglas Stewart acquisition? - Yes, integration into the ERP system is underway, and the team is already quoting and processing orders [26] Question: Any signs of economic headwinds? - No signs of economic headwinds are observed, with a strong pipeline of vendors and continued investment in the IT market [55]

Financial Data and Key Metrics Changes - Revenue increased by 6% year over year, with subscription revenue rising by 7% [7][30] - Adjusted diluted EPS grew by 10% [30] - Adjusted expenses increased by 2% year over year, primarily due to higher compensation and currency translation [35][41] Business Line Data and Key Metrics Changes - Market Intelligence reported a revenue increase of 5%, with organic constant currency growth at 7% [34] - Private markets revenue grew by 11% year over year to $148 million, driven by demand for middle market CLOs and project finance ratings [31] - Ratings revenue increased by 1% year over year, with non-transaction revenue up by 8% [37] - Commodity Insights revenue increased by 8%, with Energy Resources, Data and Insights growing by 10% [38] - Mobility revenue increased by 10% year over year, with dealable revenue up by 11% [42] Market Data and Key Metrics Changes - Build issuance declined by 4% year over year, but there was a recovery in June, marking the second highest June since 2019 [16][17] - U.S. equity markets rebounded quickly from lows seen in April, benefiting from strong net inflows for indices [18] - The outlook for the rest of the year assumes flat build issuance and flat U.S. equity markets from June 30 [18] Company Strategy and Development Direction - The company is focusing on strategic investments while maintaining disciplined expense management, resulting in 150 basis points of margin expansion [7] - There is a strong emphasis on expanding leadership in artificial intelligence and enhancing product offerings [9][23] - The company is pursuing opportunities in private credit as part of its broader private markets initiative [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver strong results in the second half of the year, despite uncertainties in the market [28][47] - The company anticipates one to two rate cuts from the U.S. Fed in the second half of the year, with slow but positive GDP growth expected [18] - Management remains cautious about the potential for volatility in the market, particularly regarding refinancing and M&A activities [86] Other Important Information - The company announced the appointment of Bill Eager as President of S&P Global Mobility and CEO Designate for the planned standalone public company [10] - The company is on track with the separation of the mobility business and will keep investors updated on progress [93] Q&A Session Summary Question: About the acceleration in organic growth in Market Intelligence - Management highlighted the transformation in Market Intelligence, focusing on structure, operating model, and incentive plans to sustain growth [54][56] Question: On margin and expense management - Management noted ongoing productivity improvements and strategic investment patterns as key factors in achieving better expense management [61][62] Question: About the Chief Client Office and criteria for moving strategic clients - Management explained that the Chief Client Office focuses on delivering individualized attention to a select group of strategic clients [65][66] Question: On competitive dynamics in private credit - Management emphasized the importance of consistent methodology and strong engagement with major private market participants to maintain leadership in private credit [78][80] Question: Regarding the second half ratings revenue assumption - Management indicated caution due to market volatility and a flat refinancing environment, while acknowledging potential upside surprises [84][86] Question: On milestones for the mobility spin-off - Management outlined internal and external milestones, including regulatory submissions and the naming of the management team [90][93] Question: About revenue guidance for mobility and potential pull forward - Management clarified that while there may be some pull forward, strong performance in the Carfax business is a key driver of growth [96][99] Question: On sanctions and upstream business growth - Management discussed the impact of sanctions on revenue and acknowledged the challenges faced by the upstream business [101]

Financial Data and Key Metrics Changes - The company reported record quarterly revenue of $15.2 million, a 46% increase from Q1 2025, and a 122% increase in shipments quarter over quarter [46][34][45] - Gross loss was $31 million, showing a 32% margin improvement from the prior quarter, supported by increased production volumes [47][49] - Net loss for the quarter was $222.9 million, which included noncash fair value adjustments tied to stock price increases [49][52] Business Line Data and Key Metrics Changes - The company achieved a 122% increase in shipments, indicating significant operational efficiency improvements [46][12] - 50% of the production volume was delivered to a single strategic customer, impacting near-term revenue and margins but viewed as a growth catalyst [46][45] - The company is transitioning to positive gross margins by Q1 2026, with expectations of achieving positive contribution margins in Q4 2025 [49][50] Market Data and Key Metrics Changes - The commercial pipeline ended the quarter with opportunities valued at $18.8 billion, representing a 37% year-over-year increase [37][38] - There was a 15% quarter-over-quarter increase in projects requiring eight or more hours of discharge, indicating a growing demand for longer-duration solutions [38][39] - The company is actively pursuing several storage projects in Puerto Rico, aiming to significantly increase the current 400 megawatt hours under MOU [41] Company Strategy and Development Direction - The company is focused on becoming the preferred solution for grid resiliency and sustainability globally, enhancing competitive positioning through strategic partnerships [44][34] - Investments are being made in core functions such as sales and engineering to support significant growth [29][48] - The company is working to localize its supply chain and build an American manufacturing base, which is expected to generate over $90 million annually when operating at capacity [34][35] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the impact of the One Big Beautiful Bill Act, which preserves production tax credits and is expected to drive demand for American-made energy storage systems [34][36] - The company is seeing increased activity in large projects as customer uncertainty has diminished following the finalization of the bill [43][64] - Management highlighted the importance of operational efficiency and scaling production to meet growing demand, with a focus on improving throughput and quality [31][72] Other Important Information - The company raised $336 million in Q2 2025, which will be used to expand manufacturing operations and improve the balance sheet [51][52] - The company has received a $5 million rebate post-closing in accordance with the terms of its financing agreement [52] - The company is working on securing additional funding from the Department of Energy to support manufacturing expansion [53] Q&A Session Summary Question: When is line two expected to be fully operational? - Line two is forecasted to come online in the first half of next year, sharing some subassembly capacity with line one [56] Question: How have customer timelines shifted post-BBB law? - Customer urgency has increased as the final language of the bill has been adopted, leading to more projects moving forward [62][64] Question: How is the company building a partner ecosystem? - The company is focusing on developing strategic relationships with integrators and equipment suppliers to ensure successful project execution [66] Question: Can the improvements in efficiency be quantified in terms of LCOE or IRR for customers? - Improvements in efficiency are expected to translate into a couple of percentage points on IRR for typical projects, but specifics will vary by project [83] Question: What is the ramp-up time for the second line? - The ramp-up time will depend on customer demand and the capital allocated for it, with updates to be provided as orders come in [88]

Financial Data and Key Metrics Changes - Consolidated revenue increased by 2%, benefiting from core growth drivers in connectivity and content, which collectively represent nearly 60% of total revenue and grew at a high single-digit rate this quarter [19][20] - EBITDA grew by 1% this quarter, adjusted EPS increased by 3% to $1.25, and free cash flow generated was $4.5 billion, with $2.9 billion returned to shareholders, including $1.7 billion in share repurchases [20][17] Business Line Data and Key Metrics Changes - Broadband subscriber losses totaled 226,000 due to competitive pressures and typical seasonality, but early signs of stabilization in Connect activity and voluntary churn were noted [20][21] - Convergence revenue grew by 3.7%, supported by high teens growth in wireless revenue, with 378,000 new wireless lines added, marking a new high for net additions [21][22] - Parks revenue increased by 19% driven by the successful opening of Epic Universe, while EBITDA growth was limited to 4% due to soft opening costs [26][27] Market Data and Key Metrics Changes - The competitive landscape for broadband remains intense, with fixed wireless and fiber competitors actively building out their networks [38] - International parks performed strongly, although Hollywood faced pressure, expected to improve in the coming quarters [27] Company Strategy and Development Direction - The company is focused on a connectivity strategy leveraging its strengths in broadband, WiFi, and convergence, aiming to build a loyal customer base with predictable pricing and improved customer experience [12][21] - The successful opening of Epic Universe reflects the long-term strategy to expand reach and enter new markets, with additional projects in the pipeline [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the changes made in the broadband business, highlighting early positive customer responses to new pricing strategies and service offerings [10][21] - The company anticipates healthy broadband ARPU growth over the year, despite a potential moderation in the near term due to the rollout of new pricing structures [21][56] Other Important Information - The company expects to benefit from recent tax legislation, estimating an average of $1 billion in annual cash tax benefits for the next several years due to infrastructure investments [33][34] - The media segment is positioned for growth with a strong lineup of content and the upcoming NBA season, which is expected to drive subscriber growth for Peacock [70][72] Q&A Session Summary Question: Details on broadband adjustments and competitive landscape - Management acknowledged the intense competitive landscape but noted early positive reactions to new pricing and customer experience initiatives [38][39] Question: Impact of involuntary disconnects and Project Genesis - Slight uptick in non-pay disconnects was observed, but overall network upgrades are on track and competitive positioning remains strong [45][46] Question: Pricing impact on ARPU growth and seasonal trends - Management indicated that while ARPU growth may moderate in the near term due to new pricing, they expect healthy growth in the long run [52][56] Question: Convergence revenue growth expectations - Convergence revenue growth is expected to face some pressure in the short term but is set up for reacceleration in the future as customer bases are repackaged [60][64] Question: M&A interest and strategic partnerships - The company remains open to considering acquisitions but emphasizes a disciplined approach, focusing on organic growth and strategic partnerships, particularly in business services [90][96]

Financial Data and Key Metrics Changes - The company reported a 7% revenue growth in Q2 2025, driven by strong commercial execution, particularly from four launch products generating $252 million in revenue [31][32] - Non-GAAP diluted EPS grew by 4% in the quarter, with an adjusted EPS of $5.73, reflecting a 9% increase when excluding certain expenses [32][40] - The company raised its full-year 2025 financial guidance, now expecting non-GAAP diluted EPS to be in the range of $15.5 to $16, up from $14.5 to $15.5 [44] Business Line Data and Key Metrics Changes - The MS franchise in the U.S. generated $657 million in revenue, supported by higher demand for VUMERITY and favorable inventory dynamics [33] - Launch products collectively saw a 26% quarter-over-quarter increase and a 91% year-over-year increase in revenue [35] - SKYCLARIS revenue grew by 5% globally compared to the previous quarter, with a 13% quarter-over-quarter growth in the U.S. [21][36] Market Data and Key Metrics Changes - The U.S. Alzheimer's market is evolving, with Leukembi's revenue growing by 20% quarter-over-quarter, and new prescribers increasing by 34% year-to-date [28] - Blood-based biomarker testing has increased by 50% in the past six months, indicating a growing acceptance in the market [27][90] - The anti-amyloid market is estimated to be growing approximately 15% in Q2 [28] Company Strategy and Development Direction - The company is focused on expanding its pipeline and has initiated several phase three studies, including for salinersen and zuranolone [10][13] - The Fit for Growth initiative continues to drive capital reallocation towards new product launches and operational efficiency [19][31] - The company plans to invest in its North Carolina manufacturing operations to support its late-stage pipeline and future products [42] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the resilience of the MS business and the growth potential of new products, despite competitive pressures [5][12] - The company is encouraged by the strong uptake of new treatments and the evolving market dynamics in Alzheimer's and rare diseases [19][28] - Management highlighted the importance of educating healthcare providers on new diagnostic tools and treatment options to enhance patient access [90] Other Important Information - The company is actively pursuing research collaborations and M&A opportunities to enhance its development pipeline [11] - The company reported a free cash flow of $134 million in Q2, maintaining a strong balance sheet with $2.8 billion in cash [40][41] - The company is addressing competitive pressures in the MS market, particularly for TECFIDERA in Europe, while expecting minimal contract manufacturing revenue in Q4 due to planned maintenance [46] Q&A Session Summary Question: Can you discuss the AHEAD-three 45 trial and its design differences compared to Trailblazer ALS three? - Management highlighted significant differences in trial design, including patient recruitment criteria and endpoints, with AHEAD-three focusing on preventing cognitive decline in presymptomatic patients [50][52][54] Question: What are the competitive dynamics for Leukembi in the U.S. market? - Management noted that while there is competition, Leukembi continues to hold a majority market share, and new treatment options are expected to expand the market [56][58] Question: How does the company view the impact of myostatin products on the SMA market? - Management believes myostatin therapies will be additive rather than competitive to existing SMA treatments, viewing them as beneficial for patients [68] Question: What is the status of the lupus pipeline and competitive landscape? - Management emphasized the unmet need in lupus treatment and the company's multi-mechanistic approach, with data expected in the 2027-2028 timeframe [72][76] Question: Can you provide an update on the relationship with Eisai and any ongoing arbitration? - Management confirmed a strong working relationship with Eisai, despite some disagreements leading to arbitration, which has not affected overall collaboration [81][84] Question: How is the company addressing the use of blood-based biomarkers in Alzheimer's diagnosis? - Management noted the rapid evolution of blood-based biomarkers and the need for education and real-world evidence to establish these tests as standard practice [90][92]

Financial Data and Key Metrics Changes - Reported revenues for Q2 2025 were $2 billion, a 15% increase compared to $1.73 billion in the prior year period, with organic growth of 8.3% driven by strong project revenue growth and pricing improvements [15][20] - Adjusted EBITDA increased by 17.7% for Q2, with an adjusted EBITDA margin of 13.7%, representing a 30 basis point increase compared to the prior year [15][20] - Adjusted diluted earnings per share for Q2 was $0.39, an 18.2% increase compared to the prior year [15] Business Line Data and Key Metrics Changes - Safety Services segment revenues increased by 15.8% to $1.36 billion, with organic growth of 5.6% driven by pricing improvements and strong growth in service and project revenues [17] - Specialty Services reported organic revenues grew 13.3% to $629 million, driven by strong project revenue growth [18] - Adjusted gross margin for Safety Services was 37.2%, a 70 basis point increase, while Specialty Services saw a decrease of 350 basis points to 18.1% due to increased project starts and rising material costs [17][18] Market Data and Key Metrics Changes - The North American safety business achieved double-digit inspection growth for the twentieth consecutive quarter, indicating strong market demand [11] - The international business delivered solid organic growth with high single-digit order growth, reflecting continued momentum under API's ownership [12][56] Company Strategy and Development Direction - The company aims to achieve over $10 billion in net revenues by 2028, with a target of 16% plus adjusted EBITDA margin and over $3 billion in cumulative adjusted free cash flow through 2028 [9][10] - Key initiatives include pricing strategies, improved revenue mix, disciplined customer selection, and selective business pruning to meet new financial targets [10][13] - The company is focused on building a strong leadership culture and investing in technology to support growth [6][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to execute the strategy and deliver against the 2025 plan, citing strong backlog and free cash flow generation [14][23] - The company anticipates continued organic growth and margin expansion, particularly in the inspection service and monitoring business [23][78] Other Important Information - The company completed six acquisitions in Q2, with a total of seven year-to-date, and plans to deploy approximately $250 million in accretive M&A this year [13][20] - The company has a strong balance sheet, with a net debt to adjusted EBITDA ratio of approximately 2.2 times [19] Q&A Session Summary Question: What businesses outperformed expectations in Q2? - Management noted that the inspection service and monitoring businesses performed largely as expected, with strong contract and project activity contributing to revenue exceeding guidance [28] Question: What caused the decline in gross margins in the specialty business? - The decline was attributed to increased project starts, rising material costs, and weather impacts, with expectations for sequential improvement in margins as the year progresses [31][32] Question: How does the guidance outlook for the base businesses look? - Management indicated that the guidance raise was driven by strong backlog and improved outlook for the second half of the year, with a third of the increase attributed to M&A [36][105] Question: What is the status of the international business? - The international business showed organic growth and high single-digit order growth, indicating strong performance and ongoing optimization efforts [56] Question: Can you elaborate on the elevator acquisition? - The elevator acquisition is performing as expected, with mid to upper single-digit organic growth, and management remains optimistic about building a billion-dollar elevator platform [46][60] Question: What are the key factors affecting backlog margin realization? - Key factors include material cost escalation, weather impacts, and labor availability, with management emphasizing the importance of execution [106][108]

Financial Data and Key Metrics Changes - The company reported record second quarter sales of $919 million, an increase of 6.5% year over year, driven by strong Activewear sales growth of 12% [5][11] - Adjusted diluted EPS reached $0.97, reflecting a 31% increase year over year, indicating a focus on profitable growth [6][15] - Gross margin improved to 31.5%, a 110 basis point increase over the prior year, primarily due to lower raw material and manufacturing costs [14] - Operating cash flow was $46 million, down from $113 million in the previous year, mainly due to higher working capital investments [15] Business Line Data and Key Metrics Changes - Activewear sales increased by 12%, supported by higher sales volumes and favorable product mix [12] - Hosiery and underwear sales decreased by 23% year over year, attributed to broad-based market demand softness and unfavorable mix [13] - International market sales declined by 14% year over year, with demand moderating in Europe and softness in Asia [12] Market Data and Key Metrics Changes - The company experienced strong sales to North American distributors, complemented by momentum with national account customers [12] - The international market faced challenges due to macroeconomic conditions, particularly in Europe and Asia [12][17] Company Strategy and Development Direction - The company is executing its Gildan Sustainable Growth strategy, focusing on operational agility and innovation [5][19] - The manufacturing complex in Bangladesh is fully ramped up, contributing to operational efficiency and cost advantages [17][19] - The company is committed to launching additional industry-leading innovations and maintaining a strong ESG focus [6][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver strong financial performance despite prevailing uncertainties [9][19] - The company reaffirmed its full-year guidance for 2025, expecting mid-single-digit revenue growth and an increase in adjusted operating margin [19][20] - Management noted that three-quarters of expected sales growth in 2025 will come from new programs [7][19] Other Important Information - The company repurchased approximately 2.9 million shares, returning $206 million in capital to shareholders, including $68 million in dividends [15] - The adjusted effective income tax rate for the quarter was 17.4%, down from 27.2% the previous year [15] Q&A Session Summary Question: Can you quantify the shifts that occurred in Q2? - Management indicated that Q2 was strong, with Activewear sales up 12%, aided by orders placed in advance of pricing actions. They expect revenue growth to be low single digits in Q3 due to timing shifts [24][26][30] Question: What was the impact from the Nike sockpaws versus the core business? - Management acknowledged headwinds in the innerwear category but expects sequential improvement as program resets occur throughout the year [32][34] Question: Can you expand on the momentum from national accounts? - Management noted that changes in the industry landscape and tariffs are driving customers to seek different suppliers, benefiting the company due to its vertically integrated manufacturing [40][41] Question: How much can you increase throughput in Honduras? - Management stated they could increase capacity by about 10% across existing facilities, which will be implemented throughout the year [49][50] Question: Is the Bangladesh facility running at optimal levels? - Management confirmed that the Bangladesh facility is fully ramped up and contributing to operating margin expansion, with further improvements expected as yarn modernization is implemented [53][56] Question: What is the outlook for corporate promotional activity? - Management expressed cautious optimism, noting that while corporate promotional activity is currently weak, they expect slight improvement as the year progresses [78][80] Question: How does the company view market weakness as an opportunity for acquisitions? - Management indicated a focus on gaining market share rather than pursuing acquisitions, leveraging their low-cost manufacturing and brand strength [101][102]

Financial Data and Key Metrics Changes - Year-to-date new and total enrollments increased by 76% compared to the prior year, driving a 9% growth in revenue on a timing adjusted and constant currency basis [6][7] - Revenue for the second quarter was $524 million, with adjusted EBITDA at $214 million, both metrics exceeding previous guidance [15] - Second quarter net income was $97 million, resulting in earnings per share of $0.65, while adjusted net income was $118 million with adjusted earnings per share of $0.79 [15][21] Business Line Data and Key Metrics Changes - In Mexico, new enrollments increased by 6% and total enrollments rose by 7%, with revenue for the second quarter up 9% and adjusted EBITDA up 19% [17][18] - In Peru, total enrollment growth was 6%, with revenue increasing by 7% and adjusted EBITDA up 9% [19][20] Market Data and Key Metrics Changes - Mexico's economy is showing resilience with solid financial systems and continued interest rate cuts, positioning it for improved GDP growth in 2026 and beyond [8][9] - Peru's economy has shown a turnaround with 3.1% GDP growth year-to-date, supported by stable inflation and strong business confidence [10] Company Strategy and Development Direction - The company is expanding its academic portfolio and digital offerings while strategically opening new campuses in high-growth areas [25][26] - Two new campuses are set to open in Monterrey, Mexico, and Lima, Peru, with plans for additional campuses in the future [7][41] Management's Comments on Operating Environment and Future Outlook - Management remains confident in the demand for quality higher education in Mexico and Peru, citing a growing middle class and favorable regulatory environments [25][27] - The company is raising its full-year 2025 outlook for revenue by $55 million and for adjusted EBITDA by $16 million, reflecting improved foreign currency exchange rates [7][21] Other Important Information - The company ended June with $135 million in cash and $116 million in gross debt, resulting in a net cash position of $19 million [20] - The company repurchased $71 million of common stock under a previously announced $100 million repurchase program [20] Q&A Session Summary Question: Any indications on the student application pipeline for Mexico's primary intake period this fall? - Management is encouraged by the trends, noting strong growth in working adult programs and positive indicators for traditional undergraduate students [30][31] Question: What contributed to the revenue upside for the quarter? - The outperformance was primarily associated with foreign exchange rates, with $18 million attributed to FX and $2 million to operational outperformance [33][34] Question: How is the online learning trend developing in Peru? - The online learning business in Peru is growing double digits, with strong interest from working adult students, similar to trends seen in Mexico [39][40] Question: Can you provide details about the new campuses? - New campuses are opening in Monterrey for Unitech and in East Lima for UPN, with strong demand anticipated [40][41] Question: How does the CapEx level change with new campus openings? - CapEx as a percentage of revenues is expected to increase to about 5% to support growth, with potential increases if additional campuses are launched [42][43]