Financial Data and Key Metrics Changes - Preferred Bank reported a net income of $32.8 million or $2.52 per share for the second quarter, showing improvement from the previous quarter [6] - Loan growth was approximately 7% on an annualized basis, with indications of increased loan demand in July [6][7] - Net interest margin increased to 3.85% from 3.75% in the previous quarter [7] - The bank repurchased $56 million in stock during the quarter, which may have impacted net interest income and net interest margin [7] Business Line Data and Key Metrics Changes - The quality of assets improved, with decreases in non-accrual loans, criticized loans, and past due loans compared to the previous quarter [8] - The bank's loan loss reserve is deemed sufficient to cover any exposure [8] Market Data and Key Metrics Changes - Deposits remained flat, attributed to the bank's strategy to control deposit costs [7] - The cost of deposits was reported at 3.41% for June, with a current offered rate around 4% [14][15] Company Strategy and Development Direction - The bank continues to focus on returning excess capital to shareholders through stock buybacks [7] - Management emphasized the importance of maintaining strong relationships with clients to navigate competitive pressures in the lending market [31] - Plans for organic expansion include opening a new branch in Silicon Valley in the second half of the year [45] Management Comments on Operating Environment and Future Outlook - Management expressed concerns about economic uncertainties, including tariffs, interest rates, and inflation, which could impact future operations [9] - The bank is closely monitoring the economic environment and its effects on clients, particularly regarding supply chain issues related to tariffs [48][50] Other Important Information - The bank received insurance reimbursement related to legal matters, which affected professional services costs [16] - The bank's strategy includes cautious evaluation of stock buybacks due to current share prices being higher than historical averages [20] Q&A Session Summary Question: Inquiry about margin and cost of deposits - The margin for June was reported at 3.83%, with a consistent cost of deposits around 3.41% [14] Question: Update on loan growth and pipeline - Loan growth was stronger in the second quarter, particularly in commercial and industrial sectors, with existing commitments funding construction loans [24][25] Question: Thoughts on competition and loan rates - Competition remains stiff, with lenders offering low fixed-rate loans, but the bank focuses on relationship-driven service [31] Question: Update on OREO and credit quality - Management noted ongoing challenges with a specific property but remains committed to resolving it without a fire sale [41][42] Question: Update on new branch performance - The Manhattan branch is performing well in loan generation, with plans for further expansion in Silicon Valley [45] Question: Client sentiment and growth acceleration - Management indicated that while some uncertainties may clear, the aftershock effects of tariffs remain unknown, impacting growth expectations [48][50]

Financial Data and Key Metrics Changes - The company's market capitalization as of June 30 is over $1,500,000,000, representing nearly 50% growth since June 2024 [8] - Net interest income continues to trend upwards as new investments with attractive yields are added to the portfolio [10] - The portfolio has grown to $14,000,000,000, which is 25% larger since the end of the first quarter and over 50% larger than the same time last year [12] Business Line Data and Key Metrics Changes - The company raised $560,000,000 of new capital this year, allowing it to continue raising capital at a premium to book value [11] - The portfolio's liquidity at quarter end was $891,000,000, or 55% of total equity, indicating a strong liquidity position [12] Market Data and Key Metrics Changes - Agency mortgage-backed securities (MBS) continue to offer attractive returns, with ROEs on newly acquired positions ranging from the mid-teens to low 20% [19] - Mortgages remain extremely cheap relative to corporate bonds, with a mixed technical picture in the medium term affecting spread tightening [20] Company Strategy and Development Direction - The company is focused on raising capital, deploying it into historically cheap investments, and managing its portfolio carefully through volatile periods [7] - A strategic increase in leverage from 7.4% to 8.3% was executed as the policy environment became more supportive [17] - The company is building a world-class operating platform by bringing several functions in-house to achieve scale and retain institutional knowledge [13] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of a proactive approach to navigating market volatility and uncertainty [16] - The current environment is viewed as highly favorable for long-term capital deployment, with wide agency MBS spreads allowing for historic returns [23] - Management expressed confidence in the company's positioning to capitalize on market dynamics and generate strong risk-adjusted returns [23] Other Important Information - The company has appointed Michael Angelo as the chief legal officer and corporate secretary, bringing relevant experience from various financial institutions [5] Q&A Session Summary Question: Can you talk about the leverage range you're targeting? - Management indicated that leverage has been flexed down when the risk environment does not warrant incremental risk, and they are currently at a level that reflects a return to normal [29][30] Question: What are the conditions that might require other investors to be more active in the mortgage-backed space? - Management noted that banks would likely return when they see actual Fed rate cuts, while money managers have been overweight mortgages relative to corporates [40][41] Question: What are your thoughts on swap spreads and their future? - Management stated that current swap spreads are attractive, providing a large margin of safety, and they expect to continue generating strong returns despite potential fluctuations [46][48] Question: How do you view the coupon allocation between pools versus TBAs? - Management explained that they are working into a larger pool position, which offers more certainty in cash flows and is expected to be as attractive as thirty-year RMBS [62][63] Question: Can you provide an overview of the returns on Agency CMBS relative to RMBS? - Management highlighted that Agency CMBS offers a stable economic return profile and is being considered for its compelling return potential in the current market [60][62]

Financial Data and Key Metrics Changes - The company's market capitalization as of June 30 is over $1.5 billion, representing nearly 50% growth since June 2024 [8] - Net interest income continues to trend upwards as new investments with attractive yields are added to the portfolio [10] - The portfolio has grown to $14 billion, a 25% increase since the end of the first quarter and over 50% larger than the same time last year [12] Business Line Data and Key Metrics Changes - The company raised $560 million of new capital this year, allowing it to continue raising capital at a premium to book value [11] - The investment portfolio grew by over $3 billion in the quarter, reflecting a strategic increase in leverage from 7.4% to 8.3% [16] Market Data and Key Metrics Changes - Agency mortgage-backed securities (MBS) continue to offer attractive liquidity, credit quality, and return potential, with ROEs on newly acquired positions ranging from the mid-teens to low 20% [18] - Mortgage spreads remain wide, and the net supply of Agency RMBS is low by historical standards, creating a medium-term headwind for spread tightening [19] Company Strategy and Development Direction - The company is focused on raising capital, deploying it into historically cheap investments, and managing its portfolio through volatile periods [7] - A long-term strategy to build a world-class operating platform includes bringing several functions in-house to enhance scale and organizational resilience [13] - The company aims to be the manager of choice for the agency mortgage market, leveraging its position as a significant player in the mortgage REIT community [42] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the current environment as highly favorable for long-term capital deployment, with wide agency MBS spreads supported by a technical backdrop [22] - The company is well-prepared to capitalize on market dynamics and generate strong risk-adjusted returns despite potential volatility [22] Other Important Information - The company has appointed Michael Angelo as the chief legal officer and corporate secretary, bringing relevant experience from various financial institutions [5] Q&A Session Summary Question: Can you talk about the leverage range you're targeting? - Management indicated that leverage has been flexed down when the risk environment does not warrant incremental risk, and they are currently at a level that reflects a return to normal [29][30] Question: What conditions might require other investors to be more active in the mortgage-backed space? - Management noted that banks would likely return when they see actual Fed rate cuts, while money managers have been active due to attractive mortgage valuations relative to corporates [38][40] Question: What is the current thinking behind the coupon allocation between pools versus TBAs? - Management explained that they are favoring a larger pool position due to the stable economic return profile and the ability to hedge effectively with interest rate swaps [56][62] Question: Any thoughts on adding longer duration as you go down in coupon on the hedge side? - Management confirmed that their hedges remain focused on the longer part of the curve, targeting a duration that is generally flat with the overall portfolio [72][74] Question: Any one-time items in the G&A expense line item? - Management indicated that the first half of the year tends to be higher due to annual meetings and compensation increases, but they expect expenses to trend down in the latter half of the year [76]

Financial Data and Key Metrics Changes - Adjusted EBITDA in Q2 improved by $271 million from the prior quarter, driven by higher shipment volumes and operational efficiency [5] - The average selling price increased by $35 per ton to $10.15, while unit costs decreased by $15 per ton [21][22] - The company ended the quarter with $2.7 billion in liquidity and no near-term maturities, with net debt on a downward trajectory [24] Business Line Data and Key Metrics Changes - Shipment volumes reached 4.3 million tons, a 150,000 ton increase from the prior quarter, allowing for more efficient mill operations [21] - The stainless steel business saw a $150 million investment in a bright annealing line, expected to improve quality and productivity [16][18] Market Data and Key Metrics Changes - The Section 232 tariffs have positively impacted both the steel and automotive sectors, with flat rolled steel imports and light vehicle imports hitting multi-year lows [6][7] - The company is positioned to benefit from the resurgence in automotive production in the U.S., as OEMs are moving production back from Mexico and Asia [70][71] Company Strategy and Development Direction - The company is focused on cost-cutting and optimizing its footprint, with expectations for further cost reductions in Q3 and Q4 [5][32] - Cleveland Cliffs is exploring potential sales of non-core assets to unlock value for shareholders, with JPMorgan engaged as an advisor [25][96] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the macro trends aligning favorably for the company, anticipating a better second half of 2025 compared to the first half [28] - The management highlighted the need for a new Federal Reserve Chairman to lower interest rates, which would benefit the automotive sector [12][13] Other Important Information - The company is vertically integrated, relying on American iron ore and coal, which differentiates it from competitors who depend on imported feedstock [15] - The company has seen a significant reduction in working capital due to inventory reductions, particularly in raw materials [22][40] Q&A Session Summary Question: How should we think about the cadence of cost reductions from here? - Management expects costs to decrease by another $20 per ton from Q2 to Q3, with further reductions anticipated in Q4 [32] Question: What are the expectations for free cash flow generation in the second half? - Free cash flow is expected to improve as working capital continues to be released, with a history of generating over $1 billion in free cash flow annually [40][41] Question: Can you provide insights on automotive volumes in Q2? - Automotive volumes are growing as OEMs are moving production back to the U.S. and reducing reliance on imports [70][71] Question: What is the outlook for average selling prices in Q3? - Average selling prices are expected to remain stable, with shipments similar to Q2 levels [53][56] Question: Can you elaborate on the non-core assets that may be sold? - The company is open to selling non-core assets that could generate significant cash inflow, which would be used for debt reduction [96][104]

Financial Data and Key Metrics Changes - Income from operations increased by 14.9% in Q2, excluding foreign currency impact, primarily due to higher US franchise royalties and fees, gross margin dollar growth within supply chain, and lower G&A expenses [15][17] - Global retail sales grew by 5.6% in Q2, with US retail sales increasing by 5.1%, driven by same-store sales and net store growth [17][19] - Same-store sales accelerated to 3.4% for the quarter, supported by the launch of Parmesan stuffed crust pizza [17][18] Business Line Data and Key Metrics Changes - Delivery business saw a positive growth of 1.5%, while carryout business grew by 5.8%, marking the highest average carryout orders in history [18][36] - The addition of Parmesan stuffed crust contributed to an average ticket increase of 1.4% due to its higher price point [18] Market Data and Key Metrics Changes - International retail sales grew by 6% in Q2, with same-store sales at 2.4%, driven by strong performance in Asia, particularly India, and the Americas [19][51] - The company added 30 net new stores in the US, bringing the total to 7,061 [18] Company Strategy and Development Direction - The company is focused on its "Hungry for More" strategy, emphasizing product innovation, value, and operational excellence to drive sales and market share [6][9] - The rollout of DoorDash is expected to significantly enhance sales in the second half of the year, with marketing efforts planned to increase awareness [11][35] - The company aims to maintain a strong franchisee network, with a focus on both large and small franchisees to ensure diverse operational strengths [92][96] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging macro environment but expressed confidence in sustaining growth, citing strong franchisee economics and a robust advertising budget [15][21] - The company expects US same-store sales growth to be around 3% for the year, with potential for higher growth in the second half due to ongoing initiatives [21][32] Other Important Information - The company repurchased approximately 316,000 shares for a total of $150 million in Q2, with $614 million remaining on its share repurchase authorization [20] - Management highlighted the importance of maintaining competitive pricing strategies to drive value for customers while ensuring franchisee profitability [102][104] Q&A Session Summary Question: Acceleration in same-store sales and sustainability of growth - Management discussed the historical performance and competitive advantages that support confidence in sustaining 3% plus same-store sales growth despite market challenges [24][30] Question: US sales outlook for the back half of the year - Management reiterated confidence in initiatives like DoorDash and loyalty programs to drive sales growth in the second half [32][36] Question: Market share gains in international markets - Management highlighted strong performance in India and Canada, attributing success to the "Hungry for More" strategy [50][54] Question: International unit development and long-term growth - Management expressed confidence in significant growth plans for India and China, with expectations for continued expansion [57][60] Question: Margins and pricing strategy - Management emphasized a focus on driving profit dollars for franchisees while maintaining competitive pricing below inflation [99][104]

Financial Performance - The company reported strong financial performance with wireless service revenue of $20.9 billion, up 2.2% year over year [6][27] - Adjusted EBITDA reached $12.8 billion, marking a 4.1% increase year over year, setting a record for the best reported quarter [6][28] - Free cash flow for the quarter was $5.2 billion, bringing year-to-date free cash flow to $8.8 billion, an increase of over $300 million compared to the first half of 2024 [6][31] Business Line Performance - The company achieved over 300,000 net additions across Mobility and Broadband platforms in the second quarter [10] - Fixed wireless access subscribers surpassed 5.1 million, with a goal of reaching 8 to 9 million by 2028 [12][24] - Fios Internet net additions were 32,000, compared to 28,000 in the prior year period, indicating robust demand [24] Market Performance - The wireless market remains competitive, with elevated postpaid phone churn due to pricing actions and competitive pressures [11][19] - The company is focused on improving retention through enhanced value propositions and AI-powered customer experience innovations [11][20] - The broadband market is expected to improve in the second half of the year, with strong demand for both fiber and fixed wireless access offerings [75] Company Strategy and Industry Competition - The company is committed to disciplined execution and customer-centric innovation, focusing on profitable connections and customer relationship value [5][36] - The strategic acquisition of Frontier is expected to accelerate fiber expansion and broadband growth [15][37] - The company is leveraging AI to enhance customer experience and operational efficiency, positioning itself as a leader in the telecommunications industry [8][13] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in the business's future, citing strong financial performance and operational execution [5][36] - The company raised its full-year guidance for adjusted EBITDA and free cash flow, driven by strong cash flow from operations and tax reform benefits [9][34] - Management acknowledged ongoing competitive pressures but remains focused on maintaining financial discipline and improving customer retention [11][19] Other Important Information - The company is on track to complete the acquisition of Frontier in early 2026, with regulatory approvals already received from eight states [25][37] - The company is committed to reducing debt and maintaining a strong balance sheet, with net unsecured debt at $116 billion, a $6.9 billion improvement year over year [31][32] Q&A Session Summary Question: Free cash flow and capital allocation outlook - Management indicated that free cash flow guidance has been raised due to improved operational cash flow and tax reform benefits, with a focus on strategic investments, dividends, and debt reduction [42][44] Question: Consumer wireless net add expectations - Management confirmed the ambition for consumer net add improvement in 2025, emphasizing financial discipline in customer acquisition [48][49] Question: Postpaid ARPA growth deceleration - Management acknowledged the deceleration in postpaid ARPA growth but highlighted ongoing initiatives to drive revenue through broadband and adjacent services [58][59] Question: Broadband market trends and competitive dynamics - Management noted a softer move environment but expressed confidence in improving broadband performance in the second half of the year [75] Question: Fixed wireless deployment pace - Management confirmed that the pace of fixed wireless deployment remains unchanged, with a focus on achieving C band coverage [101][102] Question: Spectrum acquisition strategy - Management emphasized a strong position on existing spectrum and a cautious approach to future spectrum purchases, balancing build versus buy strategies [107][108]

Financial Data and Key Metrics Changes - For the first half of 2025, the company reported net revenues of approximately €74.3 billion and adjusted operating income (AOI) of approximately €540 million, with a net loss of approximately €2.3 billion, including unusual items [6][10] - Industrial free cash flow was reported as a €3 billion outflow, which was attributed to insufficient AOI generation to cover capital expenditures and R&D spending [12][13] Business Line Data and Key Metrics Changes - The company experienced lower than expected volumes, particularly in the European light commercial vehicle (LCV) market, which was down about 13% year-to-date [21][22] - The ramp-up of newly launched products was slower than anticipated, impacting overall shipments [20][21] - The company noted a significant impact from higher industrial costs, including warranty costs and fixed asset absorption due to lower volumes [9][10] Market Data and Key Metrics Changes - The company reported a €1 billion to €1.5 billion net tariff impact for the full year 2025, with approximately €330 million felt in the first half [5][10] - Foreign exchange impacts were noted at just under €1 billion year-over-year, primarily due to the strengthening of the euro against the U.S. dollar and Brazilian real [9] Company Strategy and Development Direction - The company plans to reestablish current period financial guidance during the H1 2025 update call on July 29, which will encapsulate expected improvements in the second half [16][58] - The management emphasized the importance of product launches, including new B and C segment entries in Europe, to drive recovery and improve market share [15][16] Management Comments on Operating Environment and Future Outlook - Management acknowledged the challenging operating environment, citing economic and regulatory uncertainties that have led commercial customers to delay fleet renewals [22] - The company expressed optimism about the potential for improvement in the second half of 2025, driven by new product launches and a focus on regaining market share, particularly in the fleet segment [34][37] Other Important Information - The company noted that total vehicle inventories at the end of the first half of 2025 were unchanged, with OEM inventories up by about 60,000 units and dealer inventories down by about 60,000 units [13][14] - Management highlighted the need for continued investment in the business despite cash outflows in the first half [54] Q&A Session Summary Question: Continued share losses in the U.S. and Europe - Management indicated that market share in Europe increased by about 130 basis points compared to the second half of the previous year, despite challenges in the LCV market [20][21] Question: Operating leverage and margins in Middle East and LatAm - Management confirmed strong performance in the Middle East and LatAm, with expectations for positive traction in operating leverage and margins [24][25] Question: Gap between operating cash flow and free cash flow - Management explained that the negative cash flow was influenced by increased capital use in the financial services business, which is growing rapidly [29][30] Question: Regaining market share in fleet, particularly for Ram - Management highlighted the reintroduction of the V8 engine in the Ram pickup and plans to improve production numbers to regain lost market share [34][37] Question: Competitive pressure in Europe - Management acknowledged increased competitive pressure in Europe but noted that new product launches are expected to help mitigate this [42][43] Question: Tariff impacts and expectations for the second half - Management indicated that the €330 million tariff impact in the first half is not representative of what is expected in the second half, with potential for that figure to double [46][47] Question: Liquidity and cash generation outlook - Management reassured that liquidity remains sufficient, targeting 25% to 30% of trailing twelve months revenues, and emphasized the need to turn positive in industrial free cash flow [52][54]

Financial Data and Key Metrics Changes - Adjusted EBITDA in Q2 improved by $271 million from the prior quarter, driven by higher shipment volumes and operational efficiency [4] - Average selling price increased to $10.15 per ton, a $35 per ton increase from the prior quarter, primarily due to higher index pricing [20] - Unit costs decreased by $15 per ton, contrary to previous expectations of a slight increase [20] Business Line Data and Key Metrics Changes - Volumes reached 4.3 million tons, a 150,000 ton increase from the prior quarter, allowing for more efficient mill operations [20] - The stainless steel business saw a significant investment of $150 million in a bright annealing line, expected to improve quality and productivity [16] Market Data and Key Metrics Changes - The U.S. steel market remains strong, with Section 232 tariffs positively impacting both the steel and automotive sectors [5][6] - Imported steel and automotive imports hit multi-year lows, indicating a favorable environment for domestic producers [6] Company Strategy and Development Direction - The company is focused on cost-cutting and optimizing its footprint, with initiatives expected to show impact in the second half of the year [4] - Cleveland Cliffs is positioned to support the resurgence in American vehicle production, leveraging its integrated business model [14][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the macro trends aligning favorably for the company, anticipating a better second half of 2025 compared to the first half [28] - The company expects to continue reducing costs and improving EBITDA generation in the coming quarters [26] Other Important Information - The company ended the quarter with $2.7 billion in liquidity and no near-term maturities, with net debt on a downward trajectory [23] - Plans for potential non-core asset sales are underway, which could unlock significant value for shareholders [24][93] Q&A Session Summary Question: How should we think about the cadence of cost reductions from here? - Management expects costs to decrease by another $20 per ton from Q2 to Q3, with further reductions anticipated in Q4 [32] Question: Can you provide insights on CapEx expectations for 2027? - There is no reline scheduled for 2026, and the Middletown project is being revamped to enhance operations without hydrogen [34][36] Question: How should we think about free cash flow generation in the second half? - Free cash flow is expected to improve significantly, with a focus on using cash to pay down debt [41] Question: What are the expectations for average selling price and volume in Q3? - Shipments are expected to remain flat at 4.3 million tons, with continued EBITDA improvement anticipated [52][56] Question: What is the outlook for the Canadian market? - Management believes there is potential for growth in Canada, contingent on local policies and market conditions [60][62] Question: Can you discuss automotive volumes in Q2? - Automotive volumes are growing as OEMs shift production back to the U.S. and reduce reliance on imports [69][70]

Financial Data and Key Metrics Changes - Income from operations increased by 14.9% in Q2, excluding foreign currency impact, primarily due to higher US franchise royalties and fees, gross margin dollar growth within supply chain, and lower G&A expenses [15][16] - Global retail sales grew by 5.6% in Q2, with US retail sales increasing by 5.1%, driven by same-store sales and net store growth [16][18] - Same-store sales accelerated to 3.4% for the quarter, supported by the launch of Parmesan stuffed crust pizza, which drove positive transaction counts [16][17] Business Line Data and Key Metrics Changes - Delivery business saw a positive growth of 1.5%, while carryout business experienced a significant increase of 5.8%, marking the highest average carryout orders in history [17][35] - The addition of stuffed crust pizza contributed to an average ticket increase, benefiting from a 1.4% pricing adjustment [17][116] Market Data and Key Metrics Changes - International retail sales grew by 6%, excluding foreign currency impact, driven by net store growth of 148 and same-store sales growth of 2.4% [18][21] - Strength was noted in Asia, particularly in India, and in the Americas region, driven by Canada and Mexico [18][51] Company Strategy and Development Direction - The company is focused on its "Hungry for More" strategy, emphasizing product innovation, value, and operational excellence to drive sales and market share [5][6][8] - The rollout of DoorDash is expected to be a significant driver for US comp sales in the second half of the year, with marketing efforts planned to increase awareness [11][34] - The company aims to maintain a strong franchisee network, with a focus on both larger and smaller franchisees to ensure diverse economic strength [92][96] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging macro environment but expressed confidence in sustaining growth, citing strong franchisee economics and a robust advertising budget [15][19] - The company expects US comp sales to be around 3% for the year, with potential for higher growth in the second half due to ongoing initiatives [20][21] - International same-store sales growth is projected to be 1% to 2%, influenced by global macroeconomic uncertainties [21][66] Other Important Information - The company repurchased approximately 316,000 shares at an average price of $475, totaling $150 million in Q2, with $614 million remaining on the share repurchase authorization [19] - The launch of Parmesan stuffed crust pizza has been well-received, with customer feedback exceeding expectations, indicating a potential long-term market share catalyst [7][116] Q&A Session Summary Question: Concerns about sustaining 3% plus comp growth - Management highlighted the strength of their franchisee economics, supply chain pricing, and advertising budget as key factors that will help sustain growth beyond the current year [26][27] Question: Insights on US sales outlook for the second half - Management discussed ongoing initiatives like the "Best Deal Ever" promotion and the expected impact of DoorDash, indicating confidence in positive trends for both delivery and carryout [33][35] Question: Discussion on DoorDash as a growth vehicle - Management expressed optimism about DoorDash's potential, noting that it is expected to significantly contribute to sales growth in the coming years [39][43] Question: International market share gains - Management pointed to strong performance in India and Canada, emphasizing the successful adoption of the "Hungry for More" strategy across international markets [50][53] Question: International unit development and growth outlook - Management indicated confidence in significant growth in India and China, with plans for substantial store openings in those markets [58][60] Question: Insights on margins and pricing strategy - Management reiterated their commitment to driving profit dollars for franchisees while maintaining competitive pricing, which may be below inflation [102][105]

Financial Performance - The company reported strong financial performance with wireless service revenue of $20.9 billion, up 2.2% year over year [5][25] - Adjusted EBITDA reached $12.8 billion, marking a 4.1% increase year over year, setting a record for the best reported quarter [5][27] - Free cash flow for the quarter was $5.2 billion, bringing year-to-date free cash flow to $8.8 billion, an increase of over $300 million compared to the first half of 2024 [5][29] Business Line Performance - The company achieved over 300,000 net additions across Mobility and Broadband platforms in the second quarter [8] - Fixed wireless access subscribers surpassed 5.1 million, with a goal of reaching 8 to 9 million by 2028 [11][23] - Fios Internet net additions were 32,000, compared to 28,000 in the prior year period, indicating robust growth in broadband [23] Market Performance - The wireless market remains competitive, with elevated postpaid phone churn due to pricing actions and competitive pressures [10][18] - The company is focused on improving retention through enhanced value propositions and AI-powered customer experience innovations [10][19] - The company expects mid-single-digit growth in upgrade activity for the full year [22] Company Strategy and Industry Competition - The company is committed to disciplined execution and customer-centric innovation, focusing on profitable connections and customer relationship value [4][34] - The strategic segmented market approach is resonating with customers, driving significant sales momentum [6][35] - The company is raising its full-year guidance for adjusted EBITDA and free cash flow, reflecting strong operational performance and tax reform benefits [7][32] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in the business's future, highlighting strong performance in the first half of the year and the effectiveness of their strategy [4][34] - The company anticipates continued service revenue growth, supported by healthy underlying customer economics [26][27] - Management noted that the regulatory approval process for the Frontier acquisition is progressing as planned, which will further accelerate fiber expansion [14][24] Other Important Information - The company is actively pursuing cost efficiency programs, including copper decommissioning and managed services initiatives [28][30] - The balance sheet remains strong, with a focus on reducing debt ahead of the Frontier transaction [31] Q&A Session Summary Question: Inquiry about free cash flow and capital allocation - Management indicated that capital allocation priorities remain unchanged, focusing on business investments, dividends, debt reduction, and potential buybacks [41][42] Question: Discussion on consumer wireless outlook - Management confirmed the ambition for consumer net add improvement in 2025, while maintaining financial discipline [46][47] Question: Clarification on postpaid ARPA growth deceleration - Management acknowledged the deceleration but highlighted ongoing growth drivers and the potential for future improvements [56][58] Question: Update on broadband market trends - Management noted a consistent performance in Fios and strong demand for fixed wireless access, with expectations for better performance in the second half of the year [75][76]