Cinemark Holdings Inc.

Greetings. Welcome to Cinemark Holdings' second quarter 2025 earnings call. At this time, all participants are in a listen-only mode. The question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Chanda Brashears, Senior Vice President, Investor Relations. Thank you. You may begin.

Good morning, everyone. I would like to welcome you to CentiMark Holding, Inc.' 's second quarter 2025 earnings release conference call hosted by Sean Gamble, President and Chief Executive Officer, and Melissa Thomas, Chief Financial Officer. Before we begin, I would like to remind everyone that statements or comments made on this conference call may be forward-looking statements. Forward-looking statements may include, but are not necessarily limited to, financial projections or other statements of the company's plans, objectives, expectations, or intentions. These forward-looking statements are subject to risks and uncertainties that could cause the company's actual results to materially differ from those expressed or implied in the forward-looking statements. The factors that could cause results to differ materially are detailed in the company's 10-K. Also, today's call may include non-GAAP financial measures. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the company's most recently filed earnings release, 10-Q, and on the company's website, at ir.cinemark.com. With that, I would now like to turn the call over to Sean Gamble.

Thank you, Chanda, and good morning, everyone. As we shared during our last call in May, the second quarter launched out of the gates with the record-breaking results of a Minecraft movie, which has now generated over $950 million in global box office proceeds. That film, coupled with a steady stream of highly compelling new releases week after week, ignited a surge of summer moviegoing momentum that propelled second quarter North American industry box office to $2.7 billion, which was up more than 35% year over year. Moreover, the substantial magnitude of that result flipped year-to-date tracking from a 12% deficit versus 2024 at the end of the first quarter to a 14% gain by the end of June. Consumer enthusiasm for theatrical experiences was on full display in 2Q, as audiences turned up en masse for films like the genre-defying breakout hit Sinners, the high-flying live-action remake of How to Train Your Dragon, and Marvel's most recent Avenger adventure, Thunderbolts. That enthusiasm also delivered an all-time high Memorial Day weekend at the box office, driven by the lovable Lilo & Stitch, which just exceeded $1 billion globally, as well as an adrenaline-pumping final reckoning in Mission Impossible. Furthermore, audiences scared up a thrilling outsized result for Final Destination Bloodlines, a sizable $60 million domestic run for the faith-based film The King of Kings, and a powerful, heart-racing victory lap for F1 that yielded Apple's most significant theatrical debut to date. And that robust, movie-going momentum surged right into July with strong continued carryover from prior month releases, monstrous results for Jurassic World Rebirth, including the franchise's second highest opening of all time, a soaring Superman reboot that has ushered in a bold new era for DC Comics, and this past weekend's big first steps for the Fantastic Four, which opened to rave reviews and nearly $120 million of domestic box office that stretched well past expectations. And while August and September are typically transitional months, as box office tapers off with summer vacations winding down and school resuming, several exciting films are still to come in the third quarter, including a resurgence of comedies such as The Naked Gun, Freakier Friday, The Roses, and Spinal Tattoo, The End Continues. More thrills and chills in films like Weapons, The Conjuring Last Rites, and The Long Walk. fresh original titles like A Big Bold Beautiful Journey and One Battle After Another, and new installments of The Bad Guys, Downton Abbey, and Demon Slayer. And then the fourth quarter is primed to accelerate once again with a further array of action, comedy, thrills, family fare, and spectacle, including Tron Ares, Mortal Kombat 2, a new take on The Running Man, Zootopia 2, the exciting conclusion to last year's sensation in Wicked for Good, Five Nights at Freddy's 2, and of course, Avatar, Fire and Ash, just to name a few. Looking beyond 2025, the 2026 film slate is already shaping up to be an incredible year. Audiences can look forward to new chapters in beloved franchises like The Avengers, Spider-Man, Minions, Toy Story, Shrek, The Hunger Games and Mario Brothers, alongside innovative original concepts from visionary filmmakers like Christopher Nolan, Jordan Peele, and Steven Spielberg. This strong lineup of films on the horizon, coupled with sustained consumer enthusiasm for cinematic experiences, underscores our continued confidence in the future of theatrical exhibition. Amid this positive industry trajectory, Cinemark's execution stood out once again in the second quarter, with outperforming results that are indicative of our advantaged market position and the continued impact we are deriving from our strategic initiatives. Our team fully capitalized on the strength of moviegoing during the quarter, sustaining the core structural market share gains we have achieved over the past several years, while further benefiting from a sizable mix of family titles that accounted for three of the quarter's top four films and more than 40% of 2Q box office. Furthermore, we also continue to realize upside from our efforts to take full advantage of non-traditional programming opportunities, which drove more than 10% of our admissions revenues for the fourth straight quarter in a row as audience appeal for foreign, repertory, faith-based, content creator, and concert films continues to grow. These collective actions helped us deliver several impressive box office records during the second quarter, including our highest quarterly domestic admissions revenues since the pandemic and our third highest quarterly result of all time. We also achieved our biggest Memorial Day weekend ever, as well as a record high opening for a family film with a Minecraft movie. Importantly, We were able to translate these accomplishments into meaningful overall operating and financial results. Through solid execution and making the most of opportunities to delight our guests, our sensational team grew revenue 28% year-over-year to $941 million during the second quarter as we entertained 58 million patrons across our global circuit. Adjusted EBITDA increased a further 63% to $232 million, with over 500 basis points of margin expansion to 24.7%. We're very proud to report that our second quarter adjusted EBITDA marked our second highest quarterly achievement in the history of our company, trailing only 2Q of 2019, which included Avengers Endgame, the second highest grossing film of all time. As mentioned, our ability to consistently generate solid outperforming results is rooted in the differentiated competitive advantages we've cultivated over time, as well as the benefits we continue to gain from our growth and productivity initiatives. Examples include the quality and reliability of our technology, presentation, and guest experiences, the highly loyal customer base we've nurtured for many, many years, and our industry-leading marketing and operating capabilities. For instance, we maintain a heightened focus on making sure our guests receive a premium experience when they come to our Cinemark theaters, regardless of which auditorium they choose. Doing so includes the significant amount of time and energy we put into training and coaching our teams to deliver top-notch guest service, the careful curation of food and beverage choices we serve to appeal to a wide range of diverse preferences, and the considerable levels of investment we spend on maintaining the entirety of our theaters, which continues to exceed our peers. In addition to general overall maintenance, this investment includes further expanding reclining seats across our circuit, which now spans 70% of our domestic footprint and are consistently one of our most highly sought after amenities. It also includes diligently maintaining our best-in-class Xenon projection technology with a staggering 99.98% screen uptime across thousands of show times per day, as well as continuing to advance a multi-year conversion to Barco laser projectors that will reach nearly 25% of our circuit by year end. Altogether, these holistic efforts that benefit the totality of our theaters continued to earn us positive satisfaction scores from approximately 95% of our guests during the second quarter. They also helped us to grow our food and beverage per caps in both the U.S. and Latin America to new highs, with the U.S. exceeding $8 for the very first time at $8.34. Simultaneously, we also continued to lean into growing the volume of upgrades we provide our guests, that appeal to audiences who want a further enhanced and differentiated experience. Already today, we offer 315 premium large format auditoriums across our global circuit, six ScreenX auditoriums that provide an expanded 270-degree panoramic range of view, and the largest footprint of D-Box motion seats in the world with installations throughout more than 450 of our auditoriums. During the second quarter, our D-Box revenues reached an all-time high, and our XD PLF screens generated their second highest quarterly box office results ever. Based on this strong demand, we continue to add more PLFs throughout our theaters. We recently executed an agreement to introduce an additional 80 D-Box auditoriums over the course of this year and next, and just this week, we announced plans to roll out 20 more ScreenX experiences by the end of 2026. The investments we've made and continue to make in our theaters, amenities, service, and experiences have earned us tremendous loyalty from our guests. So too has our ongoing focus on creating meaningful perceived value for our patrons and simplifying our customer journey from buying a ticket and concessions to enjoying a film in a plush luxury lounger seat. A great example of doing so is the significant impact we've achieved through our loyalty programs. Members who participate in our free Cinemark rewards program grew to account for more than 55% of our domestic box office proceeds in the second quarter. Moreover, those who participate in our paid movie club subscription program and who are some of our most satisfied customers have driven almost 30% of our domestic box office over the past two quarters. Movie Club now has 1.45 million members, which is up 12% year over year and over 50% since 2019. The significant value and benefits our guests derive from both Movie Club and Cinemark Rewards continue to drive increased moviegoing frequency, higher food and beverage consumption, more active upgrades to enhanced offerings, and importantly, substantial loyalty to Cinemark. Additionally, Our direct connection with these guests enables us to personalize our interaction with them, providing tailored and relevant information in our communications that further enriches their engagement with Cinemark. It also meaningfully supplements our broader marketing efforts as we work to build awareness and excitement for upcoming films. With marketing reach to over 32 million addressable consumers globally, we can very effectively and efficiently amplify studio campaigns by targeting audiences that are most inclined to see a particular film and offering them an easy and immediate opportunity to buy tickets. Throughout the second quarter, we continued to leverage this network in our varied studio collaborations across social and digital media channels, in promotions and partnerships with varied third-party retailers, and to strengthen our own independent advertising. And finally, as we pursue these extensive marketing efforts to build our audiences, In tandem with the added enhancements we are making to our theaters, our beneficial loyalty programs, and the memorable experiences we offer our guests, we focus on doing so as efficiently as possible without compromising quality. Productivity is a key priority throughout our company, as is the strength and diligence of our operating practices. For example, the concentrated attention we place on achieving these objectives enabled us to increase domestic labor hours by only 13% year-over-year during the second quarter, despite a 3% expansion in our operating hours and a 27% growth in domestic attendance, while sustaining our high levels of guest satisfaction, as mentioned earlier. Overall, the second quarter once again demonstrated the strength and resilience of theatrical exhibition, as well as Cinemark's ability to fully capitalize on upswings in moviegoing. As a steadier cadence of compelling films were released into theaters, audiences continued to showcase their enduring enthusiasm for larger-than-life cinematic experiences, and we were able to deliver one of our most profitable quarters of all time. Looking forward, we remain highly encouraged about the film pipeline ahead, and we believe Cinemark remains exceptionally well positioned to thrive on account of our solid financial and operating foundation, as well as the benefits we continue to obtain from our strategic initiatives. I'll now pass the call over to Melissa, who will share more about our second quarter results. Melissa?