Good morning, and welcome to the Under Armour First Quarter 2025 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Lance Allega, SVP, Investor Relations, Treasury and Corporate Development. Please go ahead.

Good morning, and welcome to Under Armour's first quarter fiscal 2025 earnings conference call. Today's event is being recorded for replay. Joining us on today's call are Under Armour President and CEO, Kevin Plank; and CFO, Dave Bergman. Our remarks today will include certain forward-looking statements that reflect Under Armour's management's current view of our business as of August 8, 2024. These statements may include projections for our business in the present and future quarters and fiscal years. Forward-looking statements are not guarantees of future business performance, and our actual results may differ materially from those expressed or implied in the views provided. Statements made are subject to risks and other uncertainties detailed in this morning's press release and documents filed regularly with the SEC, including our annual report on Form 10-K and our quarterly reports on Form 10-Q. Today's discussion may also include non-GAAP references. Under Armour believes these measures give investors a helpful perspective on underlying business trends. When applicable, these measures are reconciled to the most comparable US GAAP measures. Reconciliations, along with other pertinent information, can be found in this morning's press release and at about.underarmour.com. With that, I'll turn the call over to Kevin.

Thank you Lance, and good morning everyone for joining us on today's call. With the first quarter of fiscal '25 behind us, I'm pleased that we started the year ahead of expectations and I'm encouraged by the early progress we're making in executing our Protect This House strategy. At the center of this strategy, we've recently declared to our team and partners that Under Armour is a sports house, a term that we're using to define the landscape in which we compete. The sports industry's version of the only handful of brands from Europe who've earned the right to refer to themselves as fashion houses. Across the sports brand landscape, we believe there are less than five brands that could be represented on this podium for sports globally, and that we are one of them, earned over our 29-year history the credibility to show up in virtually any athletic endeavor on the field, pitch or court as an outfitter, and be seen by athletes in the more than 100 countries where we do business today and are generally famous as an authentic brand, an authentic sports house brand. This rare era amongst the landscape of the sports industry is an aspect of UA that we feel is incredibly unique and just one of the attributes of strength we see for ourselves. We contemplate the opportunity that Under Armour has in front of us. We believe this authenticity gives us an advantage as we reconstitute our brand strength and execute our strategy. To make that happen, this, of course, begins and ends with our culture, elevating its importance and visibility, raising the bar of our culture across the enterprise and like our brand positioning work, we're also reconstituting this. Our culture is unique in how it describes our brand, the athletes…

Thanks, Kevin. Starting right in with the results of our first quarter of fiscal 2025 which came in better than our outlook. Revenue was down 10% to $1.2 billion with a 14% decline in North America due to softer full-price wholesale demand and lower sales to the off-price channel. Our DTC business was also down during the quarter, driven mainly by a decline in our e-commerce business resulting from proactive strategies to reduce promotional activity and a decline in our retail store sales. Revenue in EMEA was flat on a reported and currency-neutral basis, with strength in our DTC business partially offset by a slight decline in wholesale. APAC revenue was down 10% or down 7% on a currency-neutral basis, driven by declines in our wholesale and DTC businesses amid a softening macro that impacted consumer traffic and a highly competitive and promotional environment in the region. In Latin America, revenue was up 16% or up 12% on a currency-neutral basis with solid growth among regional distributors. From a channel perspective, first quarter wholesale revenue was down 8%, driven by softer demand in our full-price and distributor businesses along with lower sales to the off-price channel. Direct-to-consumer revenue declined 12% with a 25% decline in e-commerce as we work to evolve this channel to a more premium positioning via lower promotions and discounts, and sales from our own and operated retail stores were down 3%. Licensing was down 14% due to declines in our North American and Japanese businesses. By product type, apparel revenue was down 8% with declines across most categories partially offset by relative strength in golf. Footwear was down 15% with declines across most categories, partially offset by relative strength in outdoor and golf. And our accessories business was down 5%. Our first quarter gross margin was…

[Operator Instructions] Our first question will come from Jay Sole with UBS. You may now go ahead.

Great. Thank you so much. Kevin, it's clear you see some good progress happening in the business. Can you just tell us about what gives you confidence in the company's ability to deliver on the sales growth guidance that's implied in the guidance for the second half of the year and what you see happening there? Thank you so much.

Yeah. Thanks, Jay. I believe that we're -- I think we've got a really healthy view of the business right now. I think that, what we did on the last call, we put ourselves in a position to make the best decisions for the brand. I've introduced this term, sports house, that we took to our partners and frankly, to our team and anyone around this business of just understanding of not sort of getting lost up in the moment of the day. We recognize where we are. We're not crazy about it, but we're also doing something to change, I think, the weather. And so the effect that we're having, I think, is, number one, just slowly, prudently putting the best team together, which is everything. I think really getting after our strategy, which is something that, I don't think it's been off, I think it's been a matter of execution. And so, making sure that our team is super clear on what the objectives are and what the definition of success is. And so, the addition of the ability to attract A-plus talent, like bringing Eric on board, is probably a great proof positive that we're heading in the right direction with that. So, I feel good. And I think there's a lot of macro things that are going on right now that may affect what or where we are in the world. But, we've got our head down, and there's certainly no -- there's not a lot of high-fives yet, but there's definitely a growing sense of in terms of what we've accomplished to date. There's definitely a sense of what's coming and we're very proud of that.

Got it. Okay. Thank you so much.

Thank you, Jay.

Our next question will come from Bob Drbul with Guggenheim. You may now go ahead.

Good morning. Just a couple of questions for me. The first one, Kevin, on the business overall, you seem to have a sharper direction in product. Can you comment a little more on the evolution of your marketing? How long until you feel more confident about that? And then when you think about the brand marketing, what's working, what's not working, where do you think you can do a better job, and what does Eric bring to the table on that? Thanks.

Thank you. On the last call, I think we did a good job laying out the importance of product, story and region, and those three things working. We've also done a good job as part of the presentation that we took really around the world to our key partners and teammates, et cetera. And we told them that what's critical for Under Armour to do is to make sure that we're bringing in A talent. And I think if you look at the way that this table has evolved, the executive leadership team table has evolved over the last, frankly, 8 to 10 months to ten months, it's pretty significant. And product was a metaphor that I used to describe is where, we brought in some A-plus talent between John Varvatos, Yuron White, and of course, Yassine, who's heading that function up. But what makes them so powerful is the fact that they're joining a team of leaders, of partners that we already have here in the business of Dan Leraris 13 years, Kyle Blakely 15 years, Jeannette Robertson, who's another dozen years at UA. We just have this, a real depth, I think, of talent. And so, I feel the same way of the impetus of someone like an Eric joining our business of being able to balance out that troika of product, story and region of what we can do from a storytelling standpoint. And obviously, the biggest need -- and I'll come back to marketing in a second, the biggest need that we have is, we need to be aggressive in North America. And I just want to go back to people and being able to reference a partner that I have and someone like Kara Trent who's leading their force. And so, there's definitely a new…

Thank you.

Our next question will come from Simeon Siegel with BMO Capital Markets. You may now go ahead.

Thanks. Hey, everyone. Morning. Hope you're having a nice summer. So, Kevin, nice to see the first step in the brand re-elevation. Just when you think through the North America resets and that 25% SKU reduction you mentioned, could you elaborate a little bit more on how that plays in terms of reducing specific categories, specific sports, retail partners, price points? Just you alluded to it, but maybe any more thoughts on how you're going to approach that would be helpful. And just as you think about that reduction, how are you thinking about units versus price expectations within the revenue guide? Thank you.

Yeah, thanks, Simeon. I think we're going to be really thoughtful. As I said in my prepared remarks, this isn't going to be just one fell swoop. We're going to be thoughtful, we're going to be strategic and surgical with where we decide to make trims. But frankly, the idea of the 25% SKU reduction, it's as much of a metaphor for the organization today as there's not a person in the world who doesn't feel like they've got too much on their plate. So, the ability to remove 25% of the work is an ambition for the team. And with that, you're reducing everything from factory visits to lab dip approvals and all the other work and basis that comes with it. But, as we've said, to be an Under Armour product, that's got to be a process, and that has to be something which has to be vetted and gone through in a way, which is -- it needs to be special, it can't just be another T-shirt, or another shoe. It needs to be a true piece of performance product that actually makes -- helps make you better. And what we haven't done is we haven't done a good enough job, I believe, communicating that. And so ensuring that, as we say in our vision statement, provides you with performance products you never knew you needed. And once you try them, you can't imagine living without, feels like the -- an opportunity that we need to get behind. So, I think it really becomes simple too, Simeon, is that we're going to focus on our base layer compression product. It's really just going back to the foundations of the business. But we also have some things that have been working out and being prudent for us, like…

That's really great. That's exciting. Dave, any thoughts on the units versus price in the guide? And then just if I can also just throw one more. Looking at what you repurchased this quarter, how are you thinking about the approach to buybacks just given where the stock is? Seems like you're retaking brand control and recognizing the cash settlement. Thanks guys.

Sure. Yeah. I mean, I think, adding on to what Kevin said from a price value perspective, we are definitely focusing more on the ASP and ASP growth. When you think about the SKU reduction, we are trying to target a little bit more reduction in kind of the good level product and protect and really be able to invest in kind of the better and best level product all at the same time that we're working our way out of some of the deeper discounting and promotions, especially within North America e-com. So, when you kind of bring that whole equation together, that should lead to driving continued gross margin expansion, which we think is super important for the brand and for the overall business. So, that is part of that strategy that comes into play and trying to make sure that we're balancing relative to the SKU development and the higher-margin product versus lower-margin product and also how that plays into segmentation and continuing to kind of step forward better and better in how we segment, which we've taken some good strides in the last year or two, but there's still some more room to go there as well. Relative to the share buyback program, obviously, we are pleased to have the new $500 million program set up. We executed on $40 million of that in Q1, and understanding that we've had some pretty big cash outflows recently with the settlement and paying down the convertible debt, we are continuing to kind of look at our future cash flow and making sure that we've got the war chest that we want to continue to protect for any kind of curves in the road, as we had to deal with recently, or being able to invest in new ideas and new talent and new experiences similar to the recent Unless acquisition that we're working through. So, I don't know that we're going to pursue the share buyback in a huge way this year, but we are going to continue to evaluate it each quarter and make moves as prudent, especially with thinking where the stock price is right now.

Great. Thanks a lot, guys. Best of luck for the rest of the year.

Thank you.

Thank you.

Our next question will come from Geoff Lowery with Redburn. You may now go ahead.

Yeah. Afternoon, team. I appreciate that the US is your main focus at the moment, but could you talk a little bit more about the performance of the brand in the EMEA and APAC and how much is market versus your own reset activity in those regions? Thank you.

Yeah. Thank you very much. We'll start with Europe, where we've got sort of an Under Armour long term in Kevin Ross, who's now running that business for us. And so, it's someone who's a vet who's worked here in the States and obviously been over in Europe now, but just took over as recently as January or February of this year. But I think we're doing a really good job. Number one, we came from a good base and EMEA is probably our strongest region from a momentum standpoint, particularly in the UK, and timely enough, actually, in France and Paris, we're, sort of an underground favorite with what's happening at the Olympics right now. But there's work to be done. I think we're doing a good job playing to the size of the business that we are. We crossed $1 billion in the past year and that's something which gives us some size and scale. And what we're doing is we're doing it through the lens of authenticity of, on the pitch. We've got some incredible athletes like Toni Rudiger, we've got a great kid named Fermin Lopez, as I spoke about, is on the Spanish national team who will be competing against France in the final there. And there's really a lens I think that we're doing a really targeted approach in both men's and women's football on the pitch. We're also staying really close to our partnerships, JD and Sports Direct are incredibly important to us and as we see our growth. And so the wholesale is important, but we also expect to grow our DTC business and we're investing in this accordingly. And longer term, it's an evolution of a quality story, not unlike we've learned here in the US. We're applying some of the…

That's great. Thank you so much.

Thank you.

Our next question will come from Jim Duffy with Stifel. You may now go ahead.

Thank you. Good morning. Hi, Dave. Hi, Kevin.

Good morning, Jim.

I want to talk about the -- some of the management hires. You added a lot of great talent. Eric, a great addition to the team. Kevin, the title of EVP of Brand Strategy, that suggests a lot of responsibility overlap with your historical areas of focus. Can you maybe speak to your vision for the partnership with Eric? Clearly, this was part of the discussion during the recruitment process. And then with Eric on board, where do you expect to be spending more of your time?

Yeah. Thank you. It's not -- thanks, Jim. It doesn't feel too different than -- this may be a little bit of free bird, but building the brand the first time. You never really focused on sort of complementing skill sets as much as you said if you can get a pro, I'm a pretty good generalist, so I got the ability to plug other places, and bring in a professional like Eric on who -- he's got -- he's a multidisciplinary expert as well, but with having his focus over marketing, and frankly, our strategy work, as I said, is a way to get Eric horizontal in the organization that he can have that impact. And where I think our biggest need is right now is really in that product region and story balance, and we -- just we haven't had that, I think, that strength of leadership that's required for us to be successful. So, Eric is going to be leaning in there and responsible for building that out. And I'm not lost on what is that going to mean for me because there's plenty of other things to do, and that's where I think it is my job is to make sure that I'm leveling up. Let me just give a little color on the acquisition, but getting Eric here is that unless we’ll continue to be its own independent organization for us. And I think bringing in sort of the ESG approach that they have with plant-based regenerative fashion is something that is something which is a priority in the organization. Eric, of course, will help us articulate that. But I think what we want to do is make sure that the largest need that we had was just getting someone who can be the partner to Yassine and to Kara. Decision rights and the operating model is one of the things that always comes up and one of the things that Eric specifically did at Audi back in '13 or '14 when he took over there, was just working on the operating model of how product and region and marketing all work together. So, that'll be a real balance and a real plus for us. So, I'm not worried about having things to do. I'm just lucky and appreciative that we are able to attract someone like Eric. So, I think it's the beginning of many more to come. But I've got to tell you just one thing, maybe on a personal level, which is it feels like there's definitely -- there's something a bit anew and a bit of a shift, and so we're not declaring victory, we're not beating our chest for sure, but we've got a lot of work to do, but we like the direction that we're heading in right now.

Great. Thanks for that. And then, Dave, just a quick one on the D2C margins. Can you remind us when you'll anniversary the less promotional approach in D2C and get to more normalized comparisons on the D2C margins?

Yeah, it's a great question. I mean, generally speaking, it'll continue to be a benefit for us through the year. A little bit bigger in the front half versus the back half. And then as we step out of this fiscal year, we should be more on a comparable basis relative to the e-com gross margins and promotion levels as we've been kind of chipping away to get to a really nice, healthy level by the end of this fiscal year. And we're continuing to kind of test on the factory house side, which could be something that we play into more to continue to become more premium as we step into fiscal '26.

Thank you, guys.

You're welcome, Jim.

Our next question will come from Paul Lejuez with the Citi. You may now go ahead.

Hey, thanks guys. Just wanted to ask a question on your guidance. You updated the full year, you gave third quarter. Just wanted to make sure I heard correctly. I think you said $110 million to $120 million in EBIT, and that would imply a pretty large percentage of the full year coming from the first half, much smaller from the second half. So, just want to understand what your outlook is in the second half, both from a gross margin and SG&A perspective that would lead to, some pretty weak numbers, I think, in the second half based on the guidance, if I heard it correctly. And then just separately on the factory business, I think you mentioned mix results when you adjusted prices. If you could just talk about what you saw as you move prices around? And what the ultimate plan is for the factory business in terms of number of stores and what role that serves within the company? Thanks.

Sure, Paul. When you think about kind of front half versus back half, a couple of things come into play there. First of all, when you think about Q1 and that overdrive, and then what does that mean for the full year, again, keep in mind that in the back half, we are expecting a little bit more developing APAC revenue pressure. We're also expecting a little bit higher ocean freight costs than we originally planned. There's also been some increasing FX pressure, and there's a little bit of caution that we have as well, just when you think about kind of the recent economic trends. But in general, from an operating income perspective, historically, we've definitely run higher amounts in the first half of the year and a little bit lower in the back half of the year. Some of that, if you think about Q2, that's historically a high revenue dollar quarter for us, and it's also generally a higher gross margin percentage quarter for us. So, driving bigger gross margin dollars in Q2 is kind of a historical trend for us. And then that higher front half profitability is also kind of amplified this year by the planned insurance recovery relative to legal invoices paid prior to this year that I mentioned and also shifting some of our planned marketing spend out to Q3 and Q4. And maybe the last thing I'd mention there is, back half forecast also carries more incentive compensation compared to the prior year back half where we were adjusting down unfortunately and reversing some of that incentive compensation that was recorded in earlier quarters last year. So, when you add all those factors together, it points to the front half being a substantial portion of our full-year operating income, which is how we have things laid out in the plan. And on your second question relative to factory house, I would say that we did step into testing some lower promotion levels and less promotion levels, and we actually hadn't really planned on doing that. But as we stepped into that more deeply in e-com and we were excited about the results there on e-com, we decided to start testing that a little bit on factory house. And I would say that, it was both the price level, the depth of the discount, and the results were really kind of mixed, to be honest. We're experimenting, we're learning, we're seeking balance. We did give up a little bit of revenue when we were doing that. And so, we're continuing to kind of test and learn on the factory house side. But right now, I would say that the results from that are mixed and we've got some more work to do.

Thank you. Good luck.

Thanks, Paul.

Our next question will come from Laurent Vasilescu with BNP Paribas. You may now go ahead.

Good morning. Thanks very much for taking my question. Dave, I wanted to ask for the guidance, should we still assume wholesale is down low double-digits and DTC down 10% for the year? And then with e-commerce down 25%, is that the right way to think about it going forward? And is there a -- are there any lessons learned that you think you can apply to the rest of the business from the pullback and promotions in e-commerce?

Sure. Yeah, I would say that on full year, we still are looking at wholesale down kind of a low double-digit percentage, kind of in that 10% to 12% range, and then DTC being down approximately 10% or so. And that is mainly driven by our decisions to kind of reset the brand, especially in North America, with the e-com pullback on promotions and also an elevated product assortment there. Relative to e-com specific, we're not necessarily giving guidance on that, but you can -- you would definitely see that being the over-indexed decrease within the DTC being down 10%. So, definitely down more than 10%. Maybe not the full '25 that we saw in Q1 when you think about full year, but again, that is intentional. Most of that is intentional as we continue to drive through those promotional decisions within North America.

And -- hey, Laurent, maybe I can just -- let me pile on that too because I think it's really instructive of what happened and what we were able to do through the lens of our full-price e-commerce website that frankly hadn't been quite as full price a year ago. We are -- about 65% of what we were selling a year ago was promotional and about 35% full price. And with what we did by reducing -- significantly reducing promotion days, we didn't quite invert it, but we made significant progress in terms of getting to our full price sales. And so what that did as well is not only did it help us with, you saw some of the gross margin flow through for ourselves, but it also helps the algorithms on our partner websites, on the Amazon algorithm that goes around. And so, you just watched a general rising boat -- rising tide raise all boats here. So, as that's occurring, it's something that's pretty instructive as we're thinking about -- we keep talking about repairing the brand or what we're doing with the brand or how healthy the brand is right now. All those things are top of mind and top on the list of what we're going to do. But I think we're starting to see some of the models of the ways that we can invest and it'll actually pay off in return for us. And so, we'll be applying that. Again, we don't have all the facts, but we like some of the indications that we're seeing right now. We sure like driving a more full-price business and that 47.5% gross margin is something which is -- would be a pretty good indicator for the health of how we're doing.

Thank you, Kevin. Yeah, in fact, yeah, the gross margin, nice gross margin beat on the first quarter. Dave, I think you mentioned there were three factors that are incremental to the headwinds for the full year. I think you've mentioned ocean freight FX and mix from license business. Maybe could you -- for the audience, could you kind of bridge it for us, how much those were in terms of incremental headwinds versus 90 days ago as we think about the full-year guide on the gross margin?

Yeah. I mean, I think what I was trying to elaborate on is the main year-over-year drivers that are behind our full-year improvement still are heavily weighted to the favorable pricing with less DTC discounting and also the supply chain benefits related to the improved product costing. Those are the two real big positives on the full year. And obviously, we saw a little bit of extra benefit there as we went through Q1. But as we look forward, the impact on freight costs is probably the largest kind of newer developing headwind that's kind of taking away some of that Q1 overdrive. And then a close second to that would be the foreign currency headwinds that have been developing that we saw during the first three months and that are projected a little bit forward. The change in mix due to licensing sales and some of the challenge margins on the off-price channel, that's a little bit of a smaller developing headwind. The first two around freight costs and FX are a little bit bigger.

Okay, thank you. Congrats again on the beat and good luck with back-to-school.

Thank you.

Thanks.

Our next question will come from Sam Poser with Williams Trading. You may now go ahead.

Well, many of my questions have been answered. Thank you guys for taking my question. I was wondering, just to follow up on the back half guidance, when you said that there's a shift out of marketing spend out of Q2, are we going to see -- is that going to go more into Q4 because as sort of the beginning of this setup for where you're anticipating improvements into fiscal '26?

Well, actually -- so, some of Q1's bottom line overdrive was shifting some of that marketing spend to Q3 and Q4, and then similar with Q2 as well. So, we are backloading a little bit more in the back half on marketing than we originally anticipated in our outlook. But it's not all relative to Q4. I mean, some of it is laying into the brand for going into fiscal '26 and beyond, but also making sure that we're really supporting the back-to-school and also the holiday sales that are -- the holiday sales mainly that are in Q3 for us or calendar Q4.

Thank you. And then secondly, Kevin, in what you were saying, there sort of is a combination of you mentioned having patience and having -- and wanting to do things quickly. And I guess the question is, what is the sort of game-plan look for turning around to getting North America sort of on the track you want to? And how are you balancing patience, brand, speed, all of that as you -- as we look forward?

I turned 52 on Tuesday, Sam. I've actually been growing and maturing, I guess.

Happy birthday.

Thank you for the happy birthday. I've been -- as an entrepreneur, you always feel late. You feel like it's got to be done tomorrow. And that's something which has been somewhat of a strength. And at times it can be difficult, especially as you get large and need to scale as an organization. But I think really coming into our own as a business, we're opening this new headquarters, which is beautiful here in Baltimore, and I don't know if that's exactly where shareholders would have liked us to spend money, but this thing is built and it's going to be an incredible edifice for us that today we think is going to be a massive asset for the business. So, I think really it's the maturity of just recognizing the hand that we have. And I've used this analogy of I've had a pair of twos and we've had a royal flush before, and today we have neither, but we've been able to win with both. So, I feel pretty good about the hand that we have and just looking at the assets, and I've sort of said, we've got 100 things to fix at UA. And of those 100 things, I'd say probably 70%, 75% of them are self-inflicted. The good news about that is that we can identify them, we can tweak them, we can make them better. And the other great thing is that while we'd have 100 things to fix, we also have 1000 things going for us. When I think about just the sports marketing aspect of -- I'm not going to let Dave hear this, but I think with Notre Dame and IMG, that's probably enough just to build a sports brand with the credibility of one of the best high schools,…

If I can just follow-up real quick. I mean I'm really talking about timing and like, are you thinking of building this out by getting the North America turned around? Is it going to take 18 months and you're going to do it sort of slow and steady? Or is this -- what -- sort of what kind of timeframe do you have with -- in your own definition of getting North America on the right track? I mean, how are you thinking about that? Is this a six -- is this a 12-month thing or 18-month thing? That's what I'm trying to get my eye on.

Yeah. I think after the last call, we sort of pinned people to fall '25 and so we sort of gave ourselves this 18-month outlook. But, to be honest, we're not -- I don't know if there's -- I know there's a definition where you say we're done. This is just going to be a constant iteration and work in progress, and so I think you'll start seeing -- and again, we're not sitting on our hands until fall '25. We've got some great product in the marketplace right now. There's incredible things we have with our Meridian platform, our Unstoppable platform that our team has been on for a while. And so, our Baselayer platform, there's just some easy things that we can do to make sure that we're getting full credit is that I don't think that people see us as a -- unless you did grow up 15 years ago or 20 years ago, I'm not sure if you see compression as being Under Armour's founding product. And so, we need to make sure that we're giving the respect to tell the story of the products that we're building. So, I'm really confident and excited about how that -- I can't emphasize enough of where an organization that just needs to be focused on product, story, region, make sure those three aspects are coming together quickly. So, yeah, I don't know if it's long, but you're going to see constant progress. I think you'll see things like, wow, that was a really great spot for the UA. That was a really cool product. There are some things that you can get behind and then you'll watch us begin to do the SKU reduction, distort for the products that are working. And it doesn't just mean it'll be best level products, but that's that characteristic I said is that we don't have to abandon some of the current consumers we have in order to just start making more better and best level premium product.

And I think, Sam, even though we're not ready to talk about fiscal '26 or '27 revenues for North America, one thing you can be assured of is that we're going to keep driving forward on being a healthier business in North America. And I think that's really what we're excited about right now. And we'll talk more about the future in coming calls.

All right. Thank you very much.

Thank you, Sam.

This concludes our question-and-answer session as well as the conference. Thank you for attending today's presentation. You may now disconnect.