Cinemark Holdings Inc.

Greetings and welcome to Cinemark Holdings' second quarter 2026 earnings conference call. At this time, all participants are on a listen-only mode. A question and answer session will follow the formal presentation. If anyone requires operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Chanda Brashears, Senior Vice President, Investor Relations. Thank you. Please go ahead.

Good morning everyone and thank you for joining us today to discuss our second quarter 2026 results. Our earnings release, executive commentary, and 10Q were issued earlier this morning and are available on our website at ir.cinemark.com. Today's call is being webcast with a replay and transcript available on our website after the call. Before we begin, I would like to remind everyone that during this conference call, we will be making forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. 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. 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. The factors that could cause results to differ materially are detailed in our most recent annual report on Form 10-K, as filed with the SEC, and available on our website. Also, today's call will include non-GAAP financial measures. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures can be found on the website's most recently filed earnings release, 10Q, and on the company's website at ir.cinemark.com. Joining me this morning are Sean Gamble, President and CEO, and Melissa Thomas, CFO. Consistent with last quarter, Sean will provide some brief introductory remarks and then we'll turn it over to Q&A. Sean?

Thank you, Chanda. Good morning, everyone. I'd like to take a brief moment to touch on some of our key highlights from the second quarter. You can also find additional information in our executive commentary and 10Q that were published on our investor relations website this morning. We're thrilled to report today that Cinemark delivered a historic quarter in Q2, achieving a multitude of all-time quarterly records throughout our global company. For the first time in our history, our quarterly worldwide revenue exceeded $1 billion, supported by record high results across all key revenue categories. Importantly, through diligent execution and benefits derived from improved operating leverage, we effectively converted that strong top line growth into exceptional bottom line performance. We produced our highest ever quarterly adjusted EBITDA of $294 million with an adjusted EBITDA margin of 27.1%, our second highest quarterly margin in history that trailed our all-time record by only 10 basis points. We also generated nearly $300 million of free cash flow, deployed over $60 million of capital expenditures toward enhancing our business, and returned excess capital to shareholders through stock buybacks and our dividend. Our historic results are the byproduct of our ongoing efforts to elevate our consumer offerings, scale revenue opportunities, and further optimize our business, combined with a compelling slate of film releases and solid operating rigor. Beyond propelling our aggregate revenue and adjusted EBITDA records, these factors also yielded all-time high quarterly admissions revenue, concession sales and per caps, premium amenity performance, and loyalty transactions worldwide. We are incredibly proud of our global team and all they continue to accomplish. We devote significant time and effort to working on strategic initiatives to strengthen our business, and it's especially rewarding to see those actions translate into outstanding results, particularly when amplified by a favorable box office environment. The performance we delivered this quarter is a testament to the dedication, skill, and execution of our sensational team and their ability to capitalize on strong film content and positive industry dynamics. As we move ahead, we believe we are exceptionally well positioned for the future. Bolstered by our differentiated financial strength, we stand to continue benefiting from the many targeted investments we have made over the years, the meaningful customer loyalty we have earned, and the industry-leading operating capabilities we have developed. Moreover, we are actively advancing a broad set of new opportunities to further enhance our competitive edge and drive incremental growth, and we remain highly encouraged by positive recent industry developments, including expansion in theatrical window exclusivity, increases in young moviegoer frequency, and strength in emerging forms of content. In the very near term, We look forward to building further on the robust performance we've achieved through the first half of 2026, particularly with what is shaping up to be a tremendous launch of Spider-Man Brand New Day this weekend, along with continued momentum from the Odyssey. Operator, that concludes our prepared remarks, and we'd now like to open up the line for questions.