Bed Bath & Beyond, Inc.

Hello, everyone. Thank you for joining us, and welcome to the Q4 2025 Fed, Bath & Beyond, Inc. Earnings Conference Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. To withdraw your question, press star 1 again. I will now hand the call over to Melissa Smith, General Counsel and Corporate Secretary. Please go ahead.

Thank you, Operator. Good afternoon and welcome to Bed Bath & Beyond Inc.' 's fourth quarter and full year 2025 earnings conference call. Joining me today on the call are Executive Chairman and Chief Executive Officer Marcus Limonis and President and Chief Financial Officer Adrienne Lee. Today's discussion and our responses to your questions reflect management's views as of today, February 23, 2026, and may include forward-looking statements, including, without limitation, statements relating to our future business strategy, goals, financial performance, outlook for the remainder of the quarter or for any other period, anticipated growth, stock price, profitability, macroeconomic conditions, the value of any of our brands and investments, relationships with third parties, and agreements we are entering into with them, margin improvement, expense reduction, marketing efficiencies, conversion, customer experience, changes to brands or websites, product offerings, the merger agreement with the brand house collective, blockchain efforts and strategies, tokenization efforts and strategies, and the timing of any of the foregoing. Actual results could differ materially from such statements. Additional information about risks, uncertainties, and other important factors that could potentially impact our financial results is included in our Form 10-K for the year ended December 31, 2024, in our Form 10-Q for the quarter ended September 30, 2025, and in our subsequent filings with the SEC. During this call, we will discuss certain non-GAAP financial measures. Our filings with the SEC, including our fourth quarter and full year earnings release, which is available on our investor relations website at investors.beyond.com, contain additional disclosures regarding these non-GAAP measures, including reconciliations of these measures to the most comparable GAAP measures. Following management's prepared remarks, we will open the call for questions. A slide presentation with supporting data is available for download on our investor relations website. Please review the important forward-looking statements disclosure on slide two of that presentation. With that, let me turn the call over to you, Marcus.

Thanks, Melissa. I'm here with Adrian as well. I'm sure that some of you are in New York City. You, for the first time, are experiencing more snow than we have in Salt Lake, so happy skiing to everybody out there. Good afternoon, everyone, and thanks for joining us. 2025 was about stabilizing and building the base of this business. 2026 is about growing that base and expanding it within the framework of our three-pillar ecosystem architecture. That framework that we announced on January 5th remains unchanged. Over the last eight quarters, we have delivered consistent year-over-year EBITDA improvements while materially lowering the break-even level of the company. That discipline continued in the fourth quarter. Revenue declined year over year, largely reflecting housing market softness and our deliberate decision to eliminate vendors and SKUs that generated negative contribution margin. We chose margin integrity over headline revenue. That was intentional, and it's also in our past. Importantly, the year-over-year revenue gap narrowed meaningfully in the fourth quarter, while adjusted EBITDA loss improved by more than $23 million, or 84%, on lower revenue. We also delivered meaningful gross profit margin improvement in 2025 compared to 2024, despite tariff headwinds and an unpredictable sourcing environment. That improvement reflects better vendor negotiations, improved product mix, tighter inventory controls, and a more efficient operating structure. Our margin performance is increasingly structural, not cyclical. In 2026, our objective is to advance and progress our margins toward 25%, the midpoint of our 24% to 26% framework. Over time, as omnichannel scales increases and ecosystem synergies compound, we believe we can break through 26% and ultimately reset the original range higher. That progression is going to take time. We will not compromise top line growth or customer value simply to form for short term margin expansion. We believe the true base of the business has now been established in 2025. We are seeing low to mid single digit year over year increases in revenue growth early in the year and are targeting low to mid single digit revenue growth for the full year 2026 based on current trends. While we're not providing formal guidance, it is important because the company is in an active building phase, growing its base business while layering in complimentary acquisitions across each of the three pillars, we believe it is important to provide directional clarity so investors understand how performance should progress quarter by quarter and across the full year. This is a build. It is sequenced, and it is deliberate, much like the last eight quarters. We expect continued year-over-year improvement, but that improvement will not be linear. It will follow integration timing and execution milestones. In the first quarter, we expect year-over-year revenue growth and EBITDA improvement of at least 30% compared to Q1 of last year. This reflects stabilization of the base business and continued cost discipline. In quarter two, we expect to close on the Kirkland's transaction on or around April 1st. Q2 will reflect parcel ownership and will include transition and integration activity. it will not reflect the full benefit of merger synergies. We expect approximately 90 to 120 days following the closing to execute meaningful integration initiatives, including consolidation of overlapping corporate costs, vendor contract alignment and purchasing leverage, shared services optimization, supply chain integration, technology integration, and merchandising alignment. there will be transaction costs and transition costs associated with the merger and integration. Q2 should be viewed as an integration quarter, not a fully synergized quarter, but the base business will have increased revenue and will have improvement on the bottom line as it relates to EBITDA. Quarter three integration work should be executed and Q2 should begin to flow through the financials in a more meaningful way. we expect positive top-line growth and improved operating leverage with a stretch objective to approach breakeven. By Q4, assuming integration milestones are achieved, we expect positive top-line growth again and improved margin leverage with an opportunity in Q4 for profitability. This framework reflects disciplined execution, not reliance on a housing recovery. Everything we are building fits into one of three defined pillars. I outline them on my January 5th letter and again today on my February 23rd shareholder letter. Nothing sits outside the framework that I've provided. The architecture is the filter through which we evaluate every deal, every acquisition, and every decision. We are aggregators, not consolidators. A consolidator requires similar businesses to reduce cost and drive margin through scale. An aggregator, which we are, builds a connected system of complementary capabilities that strengthen one another. Later on, you'll be able to check our investor site to see the graphic that we've posted, one sheet graphic that will show you what that ecosystem looks like. We are building integration, not accumulation. Pillar one is pretty simple. It's our omni-channel business. It includes brands like Bed Bath & Beyond, Overstock, Bye Bye Baby, and Kirkland's upon closing. Including Kirkland's, this pillar approximates $1.5 billion in annualized revenue with an additional omni-channel transaction agreed to in principle with the sellers expected to add an additional $500 million in top line. Look, retail drives engagement, purchasing leverage, and customer acquisition. Pillar two is our protection, advocacy, brokerage, and financial solutions pillar. It includes property and casualty insurance, renter's insurance, home warranties, product warranties, title services, renovations and renovation financing, mortgages and HELOCs, a credit union partnership, and a scaled residential brokerage network. The brokerage platform is critical. We are pursuing the acquisition or development of a scaled residential brokerage network as we speak, of thousands and ultimately tens of thousands of agents. Protection and advocacy come first. When trust is established, customers give us permission to extend those services. Financial services is an extension of trust, not the starting point. Pillar three is our home services installation and maintenance infrastructure. It includes flooring, cabinetry, closets and storage systems, carpeting, renovation services, professional installation, repair and maintenance networks. The differentiator is the installation labor model. Most homeowners cannot self-install flooring, cabinetry, or renovation materials. Installation is required. By building a professional labor network, we create higher transaction values, stronger attachment rates, greater customer stickiness, and ongoing maintenance engagement. This infrastructure converts retail demand into completed projects and allows brokerage origination to flow into renovation activity. For all of this to work, you got to make sure that everything has a unifying layer. Surrounding all three pillars is our proprietary loyalty and identity wrapper executed in partnership with BILT. We're also building a broader home operating system. The home operating system connects the homeowner and the home through durable digital records around protection, financing, renovation history, installation records, warranties, public records, surveys, titles, deeds, and maintenance events. LifeChain supports this infrastructure by creating durable records around both the homeowner and the home itself on blockchain. Without this layer, these are separate businesses. With it, they become an integrated ecosystem. A key priority in 2026 is accelerated implementation of modern technology across the enterprise. Yes, that includes AI. We are deploying tools that increase conversion, improve inventory productivity, optimize pricing, enhance marketing efficiency, and reduce operating costs. Technology is a performance lever designed to drive revenue up and cost down simultaneously. At this point, I'll turn the call over to Adrienne to walk through our fourth quarter and full-year financial results in greater detail. Adrienne?