Mohawk Industries, Inc.

and welcome to the Mohawk Industries second quarter 2025 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note, this event is being recorded. I would now like to turn the conference over to James Frunk, Chief Financial Officer. Please go ahead.

Thank you, Ashia. Good morning, everyone, and welcome to Mohawk Industries Quarterly Investor Conference Call. Joining me on the call today are Jeff Loribond, Chairman and Chief Executive Officer, and Paul DeCock, President and Chief Operating Officer. Today, we'll update you on the company's second quarter performance and provide guidance for the third quarter of 2025. I'd like to remind everyone that our press release and statements that we make during this call may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, which are subject to various risks and uncertainties, including but not limited to those set forth in our press release and our periodic filings with the Securities and Exchange Commission. This call may include discussion of non-GAAP numbers for reconciliation of any non-GAAP-to-GAAP amounts, please refer to our Form 8K and press release in the investor section of our website. I'll now turn over the call to Jeff for his opening remarks.

Thanks, Jim. In challenging conditions across our regions, our results reflect the impact of our ongoing operational improvements, cost containment actions, and market development initiatives. Our net sales for the second quarter were $2.8 billion, essentially flat as reported and on a constant basis. Our premium residential commercial products and new collections introduced during the past 24 months benefited our performance. We generated second quarter adjusted earnings per share of $2.77, with strong productivity and restructuring actions, as well as favorable FX impact and lower interest expense, offset by higher input costs and plant shutdowns. Our restructuring actions are on schedule and delivering the expected savings as we close high-cost operations, eliminate inefficient assets, streamline distribution, and leverage technology to improve our administrative and operational costs. Our global operations team continued to identify productivity initiatives to lower our costs through enhancements to equipment, conserving energy, optimizing our supply chain, and reengineering our products. Our industry faced continued pricing pressure from lower market volume which we mitigated through strengthening product and mix. During the quarter, we generated approximately $125 million in free cash flow, and we purchased about 393,000 shares of our stock for approximately $42 million. Our board recently approved a new authorization to acquire $500 million of the company's outstanding stock. We are confident in our strategies to deliver long-term profitable growth as the industry recovers from the cyclical downturn. A dominant trend across our geographies is consumers' deferral of large discretionary purchases, which has reduced demand in our industry for almost three years. Geopolitical events, inflation, and low housing turnover are contributing to market uncertainty that is limiting residential remodeling and new construction. The commercial channel continues to outperform residential. However, the architectural billing index in the US is forecasting slowing conditions. Available US housing inventory has risen to its highest level since 2007, though elevated housing costs and high interest rates are constraining sales of both new and existing homes. In this challenging market, builders are offering price reductions and buying down interest rates to encourage purchases. While housing turnover has historically driven remodeling, we believe that families remaining in their homes longer and increasing multi-generational households will require additional renovation to meet evolving family needs. The Federal Reserve has postponed interest rate cuts while monitoring inflation and employment trends. Forecasters believe the Fed will cut rates twice in the second half of this year, given potential market weakness. In June, the European Central Bank cut rates to 2% to stimulate the economy and the housing markets. The ECB move comes as inflation has slowed to their target. Lower interest rates should support increased consumer spend, discretionary spending, and business investment. The European housing market varies by region, though a shortage of units and affordability are common issues. In June, Germany's new government approved legislation to expand home construction by removing barriers that delay building projects. Since the pandemic, European households have built up record levels of savings which combined with lower interest rates should encourage housing sales. Given the increasing tariffs, we're emphasizing the benefits of our locally produced collections and leading position as a North American manufacturer. We have begun to address the implemented tariffs through price adjustments and supply chain optimization. Earlier this month, the U.S. government set a new deadline of August 1st for countries to complete tariff negotiations while also announcing specific terms tariffs on key trading partners. We are continuing to monitor the changing tariff levels and will adjust our strategies as they evolve. On July 15th, we released our annual sustainability report, which is currently available on our website. Embracing sustainable processes and products aligns our commitment to improve our operations and provide industry-leading features and benefits. We continue to invest in product circularity, material optimization, and green energy to benefit our customers, the environment, and our results. This year, major media outlets have recognized Mohawk for reducing our carbon footprint, fostering innovation, and developing a talented organization. Now, Jim will review our financial details for the quarter.