ScanSource, Inc.

Welcome to the ScanSource Quarterly Earnings Conference Call. All lines have been placed in a listen-only mode until the question and answer session. Today's call is being recorded. If anyone has any objections, you may disconnect at this time. I would now like to turn the call over to Mary Gentry, Senior Vice President, Finance, and Treasurer. Please go ahead.

Good morning, and thank you for joining us. Our call will include prepared remarks from Mike Bauer, our chair and CEO, and Steve Jones, our chief financial officer. We will review our operating results for the quarter and then take your questions. We posted an earnings infographic that accompanies our comments and webcasts in the investor relations section of our website. As you know, certain statements in our press release and on this call are forward-looking statements and subject to risks and uncertainties that could cause actual results to differ materially from expectations. These risks and uncertainties include the factors identified in our earnings release and in our Form 10-K for the year ended June 30, 2025, and in our subsequent reports on Form 10-Q. Forward-looking statements represent our views only as of today, and ScanSource disclaims any duty to update these statements except as required by law. During our call, we will discuss both GAAP and non-GAAP results and have provided reconciliations on our website and in our Form 8 file earlier today. I'll now turn the call over to Mike.

Thanks, Mary, and thanks, everyone, for joining us today. In the second quarter, we generated strong free cash flow and delivered net sales and gross profit growth in both segments. our profitability was negatively impacted due to some unexpected expenses contained in the quarter. This resulted in declines in both gross profit and EBITDA margins compared to our very strong first quarter. In Q2, we had organic net sales growth for both segments, though slower than expected for our specialty technology solutions segment. Today, we're excited to announce the launching of a new converged communications sales team at ScanSource. This communications team unifies the ScanSource communications products and the Intellisys products and services to fully embrace the accelerating convergence of hardware, cloud, and customer experience technologies. We believe end users are embracing cloud-based UCaaS and CX platforms, and this is a growth opportunity for our channel partners. We're bringing together the expertise of our people to form one unified sales team. a team with deep knowledge of communications products and Intellisys cloud-based CX solutions. By giving this one team responsibility for both the hardware and recurring cloud business for these partners, we are strengthening partner alignment, expanding our share of wallet, and positioning ScanSource at the center of this converging ecosystem. In our Intellisys and advisory segment, our investment strategy is driving growth and momentum in new orders. We make these investments ahead of the revenue, understanding that it typically takes about a year for new orders to convert into billings. As a result, we're seeing our new orders increase at a faster rate than our current revenue from billings. New investments for Intellisys include building out our new Converge communication sales team, which is designed to further accelerate growth and capture new end-user solution opportunities. As we move ahead, our strategy centers on helping our channel partners deliver innovative, converged solutions, driving both organic net sales and free cash flow through solid execution of our strategic plan. Our team is focused on profitable growth, executing our strategy, and making progress toward our three-year strategic goals. I'll now turn the call over to Steve to take you through our financial results and outlook for fiscal year 2026. Thanks, Mike.