Financial Data and Key Metrics Changes - The company reported a 9% organic net revenue growth in Q2, marking the third consecutive quarter of high single-digit growth [9][35] - Gross margin reached a record 62.6%, expanding 140 basis points year-over-year, driven by lower product costs and a favorable channel mix [38] - Adjusted diluted EPS increased by 37% to $0.22 compared to the prior year [40] Business Line Data and Key Metrics Changes - Direct-to-consumer (DTC) sales grew by 10%, with 13 consecutive quarters of positive comparable sales growth [9][32] - The wholesale business also saw growth, up 7%, marking its third consecutive quarter of growth [32][35] - Women's business grew by 13%, while men's business increased by 6% [35] Market Data and Key Metrics Changes - The Americas net revenues were up 9%, with operating margins increasing to 20.5% [41] - Europe experienced a 15% increase in net revenues, with a 17.2% operating margin [42] - Asia's net revenues were flat, but DTC grew double digits, indicating strong performance in specific markets like Japan and Turkey [44] Company Strategy and Development Direction - The company is transitioning to a DTC-first model, with over half of its business now coming from owned and operated channels [10][12] - Strategic focus has shifted towards the Levi's brand, with the sale of Dockers and exiting the Denizen and footwear businesses [11][30] - The company aims to become a $10 billion company, emphasizing growth in lifestyle categories beyond denim [12][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating a challenging global operating environment, citing strong brand equity and consumer connection [12][54] - The company raised its full-year guidance for organic net revenue growth to 4.5% to 5.5% [48] - Management highlighted the importance of brand marketing and collaborations, such as with Nike and Beyoncé, to maintain cultural relevance [14][82] Other Important Information - The company generated free cash flow of $146 million and declared an 8% increase in dividends to $0.14 per share [45] - Inventory levels increased by 15%, primarily to support holiday sales and mitigate tariff impacts [46] Q&A Session Summary Question: Drivers of demand strength and market share gains - Management noted broad-based growth across DTC and wholesale, with strong performance in both men's and women's categories [58][64] Question: Gross margin inflection and structural changes - Management highlighted that higher DTC sales, focus on women's products, and exiting less profitable lines contributed to improved gross margins [65][68] Question: Organic wholesale revenues and growth expectations - Management indicated a prudent approach to wholesale growth, expecting it to remain flat to slightly positive for the year [73][75] Question: Marketing initiatives and AUR growth - Management discussed ongoing marketing efforts, including collaborations and campaigns, which are expected to drive brand strength and AUR growth [82][84] Question: DTC margin profile and SG&A rate - Management confirmed that DTC growth is no longer a drag on EBIT margins, with significant improvements in revenue per square foot and cost management [99][100]

Financial Data and Key Metrics Changes - For the fiscal year ended April 30, 2025, consolidated revenue was $69.8 million, up from $55.3 million in the prior fiscal year, representing a significant increase [8][10] - Gross profit increased due to higher revenue and improved gross margin, with operating income rising to $11.7 million from $5 million in the previous fiscal year [13][14] - Consolidated net income for the year was $23.7 million or $2.46 per share, compared to $5.6 million or $0.59 per share in the previous fiscal year [14] - The company's balance sheet reflects a strong working capital position of approximately $30 million and a current ratio of about 2.3:1, with no debt [15] Business Line Data and Key Metrics Changes - Revenue from commercial and U.S. Government satellite programs was approximately $40.9 million, accounting for 59% of total revenue, compared to $23.2 million or 42% in the prior fiscal year [9] - Revenue from non-space U.S. Government and DoD customers decreased to $26.5 million from $29 million, representing 38% of consolidated revenue compared to 52% previously [9] Market Data and Key Metrics Changes - The company is expanding its customer base beyond traditional prime contractors and is actively submitting bids alongside next-generation defense companies [5] - The company anticipates meaningful growth with traditional primes and is well-positioned to benefit from industry trends over the next five to ten years [5] Company Strategy and Development Direction - The company is focusing on several growth opportunities, including quantum sensing and alternative navigation technologies, which are expected to drive future growth [6][10] - The company is committed to maintaining technical excellence through increased R&D spending, which rose to $6.1 million from $3.4 million [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth driven by new legislation supporting space and defense programs, although they cautioned about variability in contract timing due to changes in administration [4][30] - The company expects to see additional revenue from contract awards flowing in over the coming quarters and years [4] Other Important Information - The company recorded a decrease in valuation allowance of approximately $13.9 million, primarily related to deferred tax assets [14] - Cash decreased by approximately $13.6 million, with dividends accounting for about $9.6 million of this decrease [15] Q&A Session Summary Question: Allocation of resources to growth opportunities - Management is actively pursuing proposals in various growth areas, with quantum sensors appearing particularly promising due to the vulnerability of GPS [21][22] Question: Adequacy of cash for increased R&D spending - Management is confident in their ability to fund increased R&D through internal funds and is exploring external funding options [24][25] Question: Short-term uncertainty and backlog variability - Management clarified that while there may be variability in future contracts, the current backlog of $70 million is solid [33][34] Question: Gross margin outlook - Management aims to maintain gross margins in the low to mid-40% range for the upcoming fiscal year [68] Question: Revenue opportunities from quantum sensing - Quantum sensing is expected to contribute less than 1% of overall revenue in the next fiscal year, with product revenue anticipated in about five years [70] Question: SG&A and R&D targets for 2026 - SG&A is expected to remain around 18% of revenue, while R&D is projected to be in the 6% to 9% range [79]

Financial Data and Key Metrics Changes - For the fiscal year ended April 30, 2025, consolidated revenue was $69.8 million, up from $55.3 million in the prior fiscal year, representing a significant increase [8] - Gross profit increased due to higher revenue and improved gross margin, with operating income rising to $11.7 million from $5 million in the previous year [13][14] - Consolidated net income for the year was $23.7 million or $2.46 per share, compared to $5.6 million or $0.59 per share in the previous fiscal year [14] - The company's fully funded backlog at April 2025 was approximately $70 million, down from $78 million in the previous fiscal year [14] Business Line Data and Key Metrics Changes - Revenue from commercial and U.S. Government satellite programs was approximately $40.9 million, accounting for 59% of total revenue, compared to $23.2 million or 42% in the prior fiscal year [8] - Revenue from non-space U.S. Government and DoD customers decreased to $26.5 million from $29 million, representing 38% of consolidated revenue compared to 52% in the prior year [9] Market Data and Key Metrics Changes - The company is expanding its customer base beyond traditional prime contractors and is actively submitting bids alongside next-generation defense companies [5] - The company anticipates meaningful growth with traditional prime contractors and is well-positioned to benefit from industry trends over the next five to ten years [5] Company Strategy and Development Direction - The company is focusing on several growth opportunities, including quantum sensing and alternative navigation technologies, which are expected to drive future growth [6][24] - The company is committed to maintaining technical excellence through increased R&D spending, which rose to $6.1 million from $3.4 million [12] - The company aims to maintain a gross margin of 40% or more in the upcoming fiscal year [72] Management's Comments on Operating Environment and Future Outlook - Management noted that while the recent quarter was strong, future quarters may not replicate this performance due to the lumpiness of contract awards [4] - There is variability in the timing of contracts due to changes in administration priorities, but the overall spending outlook remains positive [30][31] - Management expressed confidence in the company's ability to fund increased R&D spending through internal funds and external funding opportunities [25][26] Other Important Information - The company is debt-free and maintains a strong working capital position of approximately $30 million [15] - Cash decreased by approximately $13.6 million since the prior fiscal year end, primarily due to dividend payments and timing of billing [15][16] Q&A Session Summary Question: Allocation of resources to growth opportunities - Management is actively pursuing proposals in various growth areas and is in discussions with prime customers about capabilities [22][24] Question: Potential for growth in specific areas - Quantum sensor technology appears promising, with significant market potential, while Golden Dome also shows potential but with uncertain funding [24] Question: Adequacy of cash for increased R&D spending - Management is confident in having adequate cash to fund increased R&D, with a cautious approach to resource allocation [25] Question: Short-term uncertainty and backlog variability - Management clarified that the $70 million backlog is solid, with variability mainly concerning future contracts [34][35] Question: Revenue opportunities from quantum sensing - Quantum sensing is expected to contribute less than 1% of overall revenue in the next fiscal year, with product revenue anticipated five years out [73] Question: SG&A and R&D targets for future years - SG&A is expected to remain around 18% of revenue, while R&D is projected to be in the 6% to 9% range [83] Question: SDA bids and investment expenses - The SDA process is currently being rethought by the new administration, with potential developments expected within the next 9 to 12 months [86][87]

Financial Data and Key Metrics Changes - The reorganization proposal to approve the reorganization plan and agreement did not receive sufficient votes for approval, with about 66% of stockholders voting and 99% of those in favor of the reorganization [3] Company Strategy and Development Direction and Industry Competition - The company is seeking to solicit more proxies and votes to achieve the necessary majority for the reorganization proposal, indicating a strategic focus on restructuring and governance [3] Other Important Information - The annual meeting was adjourned to reconvene on July 24, 2025, at 10 AM Pacific time to continue discussions regarding the reorganization proposal [4] Q&A Session All Questions and Answers Question: Status of the reorganization proposal - The reorganization proposal has overwhelming support from those who voted, but it still requires approval from a majority of outstanding shares [3]

Financial Data and Key Metrics Changes - The company reported record high sales of $422 million for Q1 2026, a 2.1% increase from $413.2 million in the same quarter last year [12][13] - Adjusted EBITDA for the quarter was $106.4 million, representing a margin of 25.2%, up from $94.1 million or 22.8% in the prior year [17][18] - Net income for Q1 was $170.9 million compared to $39.6 million in the prior year, with adjusted net income of $53.8 million or adjusted diluted EPS of $1.78, up from $44 million or $1.46 [17][19] Business Line Data and Key Metrics Changes - The Metal Coatings segment saw a 6% increase in sales due to higher steel volume processed, while Precoat Metals experienced a slight decline of 0.8% in sales due to inventory challenges [12][13][14] - Adjusted EBITDA margins for Metal Coatings were 32.9%, while Precoat Metals had margins of 20.7% [6][12] - The company incurred a $3.8 million restructuring charge related to the closure of a powder coating facility and divestiture of a plating facility [14] Market Data and Key Metrics Changes - Demand from infrastructure-related projects benefited the company across multiple end markets, particularly in construction and electrical sectors [20] - The aluminum transition in food and beverage packaging remains a key growth driver, with the new Greenfield plant ramping production [20] - Prepainted imports fell 38% year-over-year in May, indicating a positive impact from tariffs on domestic sourcing [38] Company Strategy and Development Direction - The company is focused on disciplined execution of its strategic plan, including market share expansion and converting customers from post-paint to prepay [23] - Recent acquisitions, such as Canton Galvanizing, are aimed at scaling the galvanizing business and enhancing customer relationships [9][10] - The company plans to pursue regular and opportunistic share repurchases and has increased its quarterly cash dividend by 17.6% [19][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's financial position and growth trajectory, despite ongoing tariff uncertainties [56] - The company anticipates continued demand growth driven by infrastructure spending and reshoring initiatives [20][21] - Future sales and EBITDA guidance remains unchanged, with adjusted diluted EPS expected to increase by 10-20% over the previous fiscal year [24][23] Other Important Information - The company generated cash flow from operations of $314.8 million, including $273.2 million from the Avail divestiture [18] - The net leverage ratio improved to 1.7 times, down from 2.8 times in the prior year [19] - The company is committed to maintaining a disciplined capital allocation strategy focused on debt reduction and strategic acquisitions [19] Q&A Session Summary Question: Did Q1 benefit from normalization in volumes? - Yes, about half of the recovery was from Q4 and the other half was organic growth [27] Question: What drove improved zinc utilization for Metal Coatings? - The team has been focusing on digital tools, training, and operational excellence, nearing theoretical zinc efficiency levels [28][29] Question: How are customer inventory levels impacting Precoat? - Customers are pulling down inventory, indicating true demand, despite overall market declines [36] Question: What is the outlook for Precoat given tariff impacts? - Precoat has been affected by tariffs, but margins are up, demonstrating adaptability in cost structure [72] Question: Will share repurchases increase in future quarters? - Yes, the company is committed to share buybacks and has a $100 million facility approved for this purpose [46] Question: What is the outlook for solar projects? - There is an expectation of a pull forward in solar projects due to recent legislative changes [81]

Financial Data and Key Metrics Changes - The fourth quarter net sales were $257.1 million, a decrease of 7% year-over-year but an increase of 7% sequentially from Q3 [32][42] - Adjusted loss from operations for the fourth quarter was $21.6 million, a decrease of $11.8 million from the previous fiscal year [33] - Fourth quarter adjusted EBITDA was a negative $7.1 million, down $12.4 million from the same period last year [35] - Full year net sales were $1.048 billion, a decrease of 6% from the previous fiscal year [42] Business Line Data and Key Metrics Changes - Record sales for power products in data center applications exceeded $80 million for the full year, almost double that of fiscal 2024 [13][42] - EV sales represented 20% of consolidated total sales, an increase from 14% year-over-year, but sequentially decreased by approximately 10% from Q3 [15] - The company expects a 10% to 15% decline in EV sales for fiscal 2026 due to weaker market demand and program delays [16] Market Data and Key Metrics Changes - The company experienced significant sales headwinds from the roll-off of major auto programs, particularly the GM center console and EV lighting programs [11][42] - The decline in sales was primarily driven by the impact of these program roll-offs, which had a combined year-over-year impact of $111 million [42] Company Strategy and Development Direction - The company is focused on improving operational execution and successfully launching a large pipeline of new programs, with 22 new programs launched in fiscal 2025 and another 30 expected in fiscal 2026 [18][19] - The transformation strategy aims to stabilize the organization and position it for future growth, particularly in data centers and EV markets [20][27] - The company plans to optimize its footprint and reevaluate its product portfolio to align with market opportunities [22][27] Management's Comments on Operating Environment and Future Outlook - Management indicated that fiscal 2026 will be a reset year due to EV program delays, particularly from Stellantis, but expects a return to growth in fiscal 2027 [7][10] - The company anticipates doubling its EBITDA in fiscal 2026 despite projected declining sales of approximately $100 million [10][28] - Management emphasized the importance of operational improvements and cost recovery actions in response to external challenges [16][17] Other Important Information - The company recorded $26 million in free cash flow for the quarter, marking the best quarter since Q4 of fiscal 2023 [8] - The company reduced both debt and net debt levels by $10 million from Q3 [17] - The board reduced the dividend, which was a strategic decision to provide more flexibility from a working capital perspective [92] Q&A Session Summary Question: How to understand the expected sales decline and EBITDA increase? - Management explained that operational improvements and the elimination of one-time expenses will contribute to the expected EBITDA increase despite declining sales [52][54] Question: What percentage of the new launches are EV platforms? - Approximately 50% of the new launches are related to EV platforms, with a significant focus on data center growth as well [56][74] Question: What is the status of Stellantis revenue expectations? - Management confirmed a significant reduction in expected revenue from Stellantis, with a $200 million swing from previous projections due to program delays [44][80] Question: What is the leverage waiver status? - The leverage covenants were relaxed through the next year, starting at 4.25 for Q4 of fiscal 2025 [62][64] Question: How much of the revenue decline is due to pricing? - The revenue decline is primarily due to program delays and cancellations, not pricing issues [100]

Financial Data and Key Metrics Changes - The fourth quarter net sales were $257.1 million, a decrease of 7% year-over-year but an increase of 7% sequentially from the third quarter [35][36] - The full year fiscal 2025 net sales were $1.048 billion, down 6% from $1.115 billion in fiscal 2024, primarily due to program roll-offs [45] - The fourth quarter adjusted loss from operations was $21.6 million, a decrease of $11.8 million from fiscal 2024 [36] - Fourth quarter adjusted EBITDA was a negative $7.1 million, down $12.4 million year-over-year [39] - Free cash flow for the fourth quarter was $26.3 million, an increase of $10.5 million from fiscal 2024 [42] Business Line Data and Key Metrics Changes - Record sales for power products in data center applications exceeded $80 million for the full year, nearly double that of fiscal 2024 [14][45] - EV sales represented 20% of consolidated total sales, showing a year-over-year increase of 1419%, but a sequential decrease of approximately 10% from Q3 [16] - The automotive segment faced significant challenges, with historical warranty and quality issues contributing to losses [13][41] Market Data and Key Metrics Changes - The company expects a 10% to 15% decline in EV sales for fiscal 2026 due to weaker market demand and program delays [17] - The company anticipates a significant rebound in EV sales in fiscal 2027 based on customer forecasts and industry projections [17] Company Strategy and Development Direction - The company is focused on improving operational execution and successfully launching a large pipeline of new programs, with 30 new program launches expected in fiscal 2026 [20][49] - The transformation strategy aims to enhance operational efficiency and drive innovation, particularly in data centers and EV markets [30][31] - The company plans to optimize its footprint and reevaluate its product portfolio to align with market opportunities [29][30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that fiscal 2026 will be a reset year due to EV program delays, particularly from Stellantis, but expects to double EBITDA despite declining sales [11][12] - The leadership team emphasized the importance of maintaining discipline and focus on objectives amid external challenges such as tariffs and market volatility [24][25] Other Important Information - The company has successfully remediated three material weaknesses in internal controls identified in fiscal 2024 [51] - The dividend was reduced to $0.07 per share to provide flexibility and align with peers, considering the company's financial situation [104] Q&A Session Summary Question: What are the key earnings levers given the expected sales decline? - Management highlighted operational improvements and the elimination of one-time expenses as key factors for expected EBITDA growth despite lower sales [54][58] Question: How many of the new launches are EV platforms? - Approximately 50% of the new program launches are related to the EV market, with a significant focus on data center growth as well [79] Question: Can you clarify the leverage waiver and covenant levels? - The leverage covenants were relaxed, starting at 4.25 for Q4 of fiscal 2025, with confidence in meeting these covenants over the next year [66][67]

Financial Data and Key Metrics Changes - The company reported record high sales of $422 million for Q1 2026, a 2.1% increase from $413.2 million in the same quarter last year [15] - Adjusted EBITDA for the quarter was $106.4 million, representing a margin of 25.2%, compared to $94.1 million or 22.8% in the prior year [20] - Net income for Q1 was $170.9 million, significantly up from $39.6 million in the prior year, with adjusted net income at $53.8 million or $1.78 per diluted share, a 22.2% increase year-over-year [20][27] Business Line Data and Key Metrics Changes - The Metal Coatings segment saw a 6% increase in sales due to higher steel volume processed, while Precoat Metals experienced a slight decline of 0.8% in sales due to inventory challenges [16][19] - Adjusted EBITDA margins for Metal Coatings were 32.9% and 20.7% for Precoat Metals, indicating strong performance in both segments [7] Market Data and Key Metrics Changes - Demand from infrastructure-related projects benefited the company across multiple end markets, particularly in construction and electrical sectors [24] - The aluminum transition in food and beverage packaging remains a key growth driver, with expectations for continued demand due to reshoring activities and tariffs [24] Company Strategy and Development Direction - The company is focused on disciplined execution of its strategic plan, including market share expansion and converting customers from post-paint to prepay [26] - Recent acquisitions, such as Canton Galvanizing, are aimed at scaling the galvanizing business and enhancing customer relationships [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the fiscal year 2026, reiterating sales and EBITDA guidance while increasing EPS guidance due to strong demand forecasts [26][27] - The company remains cautious about sales due to ongoing tariff uncertainties but is confident in its ability to manage costs and improve margins [62] Other Important Information - The company generated cash flow from operations of $314.8 million, including $273.2 million from the Avail divestiture, allowing for significant debt reduction [21][22] - The Board approved a 17.6% increase in the quarterly cash dividend from $0.17 to $0.20 per share [22] Q&A Session Summary Question: Did Q1 benefit from normalization in volumes? - Management confirmed that Q1 saw recovery from Q4 weather impacts, contributing to organic growth [30] Question: What drove improved zinc utilization for Metal Coatings? - Management attributed it to digital tools, training, and operational excellence, nearing theoretical efficiency levels [31][33] Question: Outlook for Precoat Metals given customer inventory levels? - Management noted that while overall market demand is down, customer inventory drawdowns indicate true demand, with tariffs impacting imports [40][42] Question: Plans for share repurchases and capital allocation? - Management confirmed commitment to share buybacks and strategic acquisitions, with a focus on maintaining a disciplined capital allocation strategy [50][52] Question: Impact of copper tariffs on business? - Management indicated that while recent tariff announcements are new, prior positive trends in project viability remain, with ongoing monitoring of customer feedback [55][56] Question: Expectations for Precoat Metals segment? - Management expects continued margin improvement despite lower volumes, with the new facility ramping up production [77][80]

Financial Data and Key Metrics Changes - The company reported a pretax income of $1.8 billion, with earnings of $2.1 per share, and achieved record quarterly revenue of $15.5 billion, reflecting a year-over-year increase of approximately 1% [7][17] - The operating margin was 13.2%, and free cash flow generated during the quarter was $700 million, bringing the year-to-date total to $2 billion [7][27] - Non-fuel unit cost growth was 2.7%, consistent with previous quarters, indicating effective cost management despite operational challenges [27][30] Business Line Data and Key Metrics Changes - Premium revenue grew by 5% year-over-year, while loyalty revenue increased by 8%, demonstrating strong customer engagement, particularly among millennial and Gen Z segments [19][20] - Revenue from Delta's travel products portfolio grew by 8%, with significant growth in cars, stays, and cruise products [21] - Cargo revenue increased by 7% year-over-year, and MRO revenue accelerated to 29% growth, reflecting higher volumes and work scopes [21][22] Market Data and Key Metrics Changes - Overall demand for air travel remained stable compared to the previous year, with softness primarily in the main cabin during off-peak periods [9][10] - The company noted that corporate revenue improved modestly year-over-year, with premium products showing sustained strength [21][22] - The company expects revenue growth for September to be flat to up 4% year-over-year, indicating stable demand across consumer and corporate segments [22][30] Company Strategy and Development Direction - The company is focused on managing capacity to match demand and controlling costs to deliver strong earnings and free cash flow [11][12] - Strategic investments are being made to enhance the travel experience, expand customer choice, and deepen loyalty to the Delta brand [24][25] - The company is also investing in technology to optimize revenue through AI-enhanced pricing solutions and improving operational efficiency [15][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to restore financial guidance for the full year, expecting earnings per share of $5.25 to $6.25 and free cash flow of $3 billion to $4 billion [12][30] - The management highlighted a stable demand environment and anticipated improvements in unit revenue trends as the industry rationalizes domestic supply [23][30] - There is optimism regarding the recovery of business travel, with indications that consumer confidence is improving [46][68] Other Important Information - The company announced a 25% increase in its quarterly dividend, reflecting strong cash generation and commitment to returning cash to shareholders [7][30] - The company has a fully funded pension and significant unencumbered assets, which supports its investment-grade rating [29][105] Q&A Session Summary Question: Can you elaborate on industry capacity in 3Q and 4Q? - Management noted a significant reduction in industry capacity, particularly in off-peak periods, which is expected to support profitability [35][36] Question: How is the cabin segmentation being received? - Management indicated that there is strong demand for premium cabins, and they are focused on providing more choices and pricing options [37][41] Question: What are the trends in corporate demand? - Management reported that corporate spending is expected to remain stable or increase, with favorable sectors including banking and technology [62] Question: How is the booking curve shifting? - Management acknowledged that the booking curve has shifted closer in, but there are signs of improvement as consumer confidence returns [108][110] Question: What is the outlook for MRO revenue? - Management expressed optimism about MRO revenue growth, indicating potential for significant increases in the coming years [100][99]

Financial Data and Key Metrics Changes - The company reported a pretax income of $1.8 billion, with earnings of $2.1 per share and an operating margin of 13.2% [7][27] - Free cash flow for the quarter was $700 million, bringing year-to-date free cash flow to $2 billion [7][27] - A 25% increase in the quarterly dividend was announced, reflecting strong cash generation [7][29] Business Line Data and Key Metrics Changes - June revenue increased approximately 1% year-over-year to $15.5 billion, with premium revenue growing 5% [18][19] - Loyalty revenue grew 8%, with significant engagement from millennial and Gen Z segments [19][20] - Cargo revenue increased by 7% year-over-year, while MRO revenue accelerated to 29% growth [21] Market Data and Key Metrics Changes - Overall demand for air travel remains stable compared to last year, with softness primarily in the main cabin during off-peak periods [9][22] - Corporate revenue improved modestly year-over-year, with Delta's share premium at historic highs [21] - International margins have structurally improved, reflecting the success of strategic investments [21] Company Strategy and Development Direction - The company is focused on elevating its airline status, expanding its global footprint, and investing in technology [13][16] - New partnerships, such as the equity stake in WestJet and collaboration with Indigo, are aimed at enhancing international growth potential [15] - The company is adjusting capacity to match demand and managing costs to deliver strong earnings and free cash flow [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the stability of the U.S. economy and anticipated improvements in consumer and corporate confidence [10][12] - The company expects earnings per share for the full year to be between $5.25 and $6.25, with free cash flow projected at $3 billion to $4 billion [12][31] - Management noted that while business travel has returned, there is still potential for growth as the economy stabilizes [47][68] Other Important Information - The company is leveraging AI for revenue optimization through partnerships with technology firms [16][60] - The operational performance has been strong despite challenges from severe weather, with a focus on efficiency across operations [27][91] - The company has a fully funded pension and significant unencumbered assets, enhancing its financial stability [28][101] Q&A Session Summary Question: Can you elaborate on industry capacity in 3Q and 4Q? - Management noted a significant reduction in industry capacity, with domestic industry seats down close to 1% by September, indicating a positive adjustment to restore profitability [35][36] Question: How is cabin segmentation being received? - Management confirmed that there is strong demand for premium cabins, and they are focused on providing more choices and pricing options to customers [37][42] Question: What is the outlook for corporate demand post-Labor Day? - Management indicated that most sectors are expected to maintain or increase spending, with banking and technology showing favorable trends [62] Question: How do tariffs impact aircraft deliveries? - Management stated they do not plan on paying tariffs for aircraft deliveries and are encouraged by ongoing discussions in Washington [54] Question: What is the status of AI and revenue management solutions? - The company is currently testing AI solutions on about 3% of its domestic network, aiming for 20% by year-end, and is optimistic about the results [60] Question: How is the booking curve changing? - Management observed that advanced bookings are improving, with the highest cash sales day recorded in July, indicating a positive trend [69][70]