Universal Electronics Inc.

Good afternoon. My name is Therese, and I will be your conference operator today. Now, I would like to welcome everyone to Universal Electronics' third quarter 2025 financial results conference call. All lines have been placed on mute to prevent any background noise. After the speaker remarks, there will be a question and answer session. To ask the question, you will need to press star 11 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I will now turn today's conference call over to Richard Land of Alliance Advisors Investor Relations. Please go ahead.

Thank you, operator, and thank you all for joining us for the Universal Electronics third quarter 2025 financial results conference call. This afternoon, UEI issued a press release for the third quarter ended September 30, 2025. If you do not already have a copy of this press release, it can be found in the investor relations section of the company's website. This call is being broadcast live over the internet. A webcast replay of this call, including any additional updated material or non-public information that might be discussed during this call, will be available on the company's website at www.uei.com for one year. During this call, management may make forward-looking statements regarding future events and the future financial performance of the company and cautions you that these statements are just projections and actual results or events may differ materially from those projections. These statements can be found in the press release issued today and on the website. The company undertakes no obligation to revise or update these statements to reflect events or circumstances that may arise after today's date And we refer you to the press release mentioned at the onset of this call and the documents the company has filed with the SEC, including its 2024 annual report on Form 10-K and the periodic and current reports filed or furnished since then. The financial remarks will reference adjusted non-GAAP metrics. Management provides adjusted non-GAAP metrics because it uses them for budget planning purposes and for making operational and financial decisions and believes that providing these non-GAAP financial measures to investors as a supplement to GAAP financial measures helps provide context for the operating performance. A full description and reconciliation of these adjusted non-GAAP measures versus GAAP are included in the company's press release issued today. Joining me today are Chief Operating Officer and Interim Chief Executive Officer Rick Carnifax and Interim Chief Financial Officer Raymond Hull. Rick will provide an overview of our business, and Raymond will deliver the detailed financial results. Rick will then open the call for questions. With that, it's my pleasure to introduce Rick Carnifax. Please go ahead, Rick.

Thank you, Richard, and thank you all for joining us. We remain committed to advancing our control and sensing technologies while directing investment toward areas that drive profitable growth. As part of our channel diversification strategy, we are expanding beyond core HVAC OEM offerings, entering adjacent markets such as utilities and multi-dwelling unit property management, while also increasing our presence in the security channel. At the same time, we continue to refine our operating model to nurture long-term growth in the connected home channel, and focus our home entertainment R&D on projects that offer strong returns. Innovation remains central to our strategy as we gain traction with new technologies and markets. In Q3 2025, due to right sizing and cost controls, we delivered solid margin performance and strong cash generation while facing revenue headwinds. Revenue is $90.6 million, slightly below expectations due to temporary and structural market factors. In connected home, revenue grew 13%, broadly in line with our expectations. However, we encountered market softness reflected in customer inventories, limiting purchases as product works its way through the channel. In home entertainment, structural challenges in Latin America and Europe persisted, while lower than expected television sales impacted our Asian customer volumes. As outlined in our last call in Q4 2025, we expect our quarterly revenue to decline year-over-year and expect to deliver full-year growth and connected home compared to 2024. Gross margin was 29.1%, and EPS was within our guidance range at $0.08. Our net cash position increased significantly this quarter by $9.1 million, reflecting disciplined execution in a challenging environment. To counter headwinds and enhance agility, we continued executing actions on cost in Q3. We began the closure of our Mexico facility, which remains on schedule. We achieved target milestones at our Vietnam facility, and production transfer is progressing as planned. We also initiated qualification and transfer processes for products that will remain in Mexico with our contract manufacturing partner in Mexicali. These steps should be wrapped up by year end, minimizing disruption risk and ensuring continuity for key customers. We also implemented targeted reductions in force to streamline operations in August and later again in late September and reallocated resources toward growth priorities. Additionally, we identified and eliminated fixed and variable expenses that no longer deliver the requisite value. These actions are expected to yield annualized cost savings of approximately $5 million beginning in Q4. To broaden our connected home presence, we are leveraging our TideTouch platform to pursue new opportunities and adjacent channels. Energy management is a growing priority in Western Europe. To meet this demand, we enhance TideTouch with new features that support energy efficiency and provide utilities with actionable insights. Following two years of testing with a lead European customer, initial shipments began in Q3 with volumes expected to ramp in 2026. We are applying a similar approach to serve multi-dwelling unit property managers. By integrating interoperability with smart devices such as door locks and water leak detectors, TiTouch offers a turnkey solution. It delivers energy efficiency, convenience, and remote management capabilities while reducing the risk of costly failures. Official launch is planned for 2026. In home entertainment, we remain focused on high value commercial opportunities. In Q3, we secured a new design win for our batteryless hybrid supercap remote control, which eliminates the need for replaceable batteries, reinforcing UEI's leadership and sustainable product innovation. In addition, software licensing, which carries our highest gross margin, continues to be a strong profit driver. During Q3, we secured 2026 commitments for our Kwikset cloud platform across our three primary smart TV customers. We also added four new smart TV brands, including Sharp and Xiaomi, which will employ our digital rights management protection software services beginning in Q1 2026. Overall, innovation remains a cornerstone of UEI's long term strategy. QuickSet HomeSense, introduced at CES 2025, represents a meaningful step forward in smart home intelligence. The platform adds on-device learning that interprets environmental data and device activity to deliver personalized, real-time automation. Built on UEI's expanding knowledge graph, HomeSense can detect user presence, identify anomalies, and optimize settings, making homes more efficient, secure, and intuitive. Its software-defined sensing framework can be activated by a simple firmware update on most connected devices. For example, it can automatically adjust HVAC settings based on user proximity or set the home to away mode when unoccupied. Since launch, HomeSense has gained strong traction, with major HVAC brands currently in testing and home entertainment partners committed to 2026 product introductions. We will also integrate HomeSense into our TideTouch smart thermostats, creating an optimized, privacy-driven energy management solution. Finally, regarding the ongoing litigation against Roku, as discussed on our last call, the District Court has lifted the stay, ruled in our favor to consolidate actions, and proceed to trial. The trial date has been set for March 2027, which we view as a favorable timeline. Discovery is underway and we will continue to provide updates as appropriate as the case progresses toward a jury trial. With that, I'll now turn the call over to our interim CFO, Raymond Ho, to provide an update on our financial results.