Spin Master Corp.

Good morning, ladies and gentlemen, and welcome to the Spin Master Corporation third quarter 2025 results conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session for covering analysts. If at any time during this call you require immediate assistance, please press star zero for an operator. This call is being recorded on Thursday, October 30th, 2025. I would now like to turn the conference over to Tim Foran, Vice President, Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and thank you for joining our call. With me here today are our CEO, Christina Miller, and our CFO, Jonathan Reuter. For your convenience, the press release, MD&A, and consolidated financial statements are available on the Investor Relations section of our website at spinmaster.com and on CDAR+. Before we begin, please note that remarks on this conference call may contain forward-looking statements about SpinMaster's current and future plans, expectations, intentions, results, levels of activity, performance, goals or achievements, and any other future events or developments. Forward-looking statements are based on currently available information and assumptions that management believes are appropriate and reasonable in the circumstances. However, there could be no assurance that such assumptions will prove to be correct and many factors could cause actual results to differ materially from those expected or implied by the forward-looking statements. As a result, your caution is not to place undue reliance on these forward-looking statements. For additional information on these assumptions and risks, please consult the cautionary statements regarding forward-looking information in our earnings release dated today, October 30th, 2025. Except as may be required by law, SpinMaster disclaims any intention to update or revise any forward-looking statements whether because of new information, future events, or otherwise. Please note that Spin Master reports in U.S. dollars, and all dollar amounts today are expressed in U.S. currency, unless otherwise noted. Also note that unless noted otherwise, all percentage growth rates refer to the three months ending September 30, 2025, relative to the same period in 2024. I would now like to turn the conference call over to Christina.

Thank you, Tim, and good morning to everyone who is joining us today. In terms of an agenda for the call, I will start with a review of the quarter and how things are shaping up for the holiday season. Then I will provide a high-level overview of our strategy and priorities before passing it to Jonathan to provide a financial review of the quarter. This quarter, toys, entertainment, and digital games once again captured the imagination of kids and parents, reflecting our focus on innovation and storytelling. However, underlying performance was not matched in our financial results, but this was anticipated. Toy revenues have been negatively impacted this year by the shift in retailer buying patterns stemming from tariffs. At the POS level, we performed significantly better in toys in Q3 than our revenues reflect. Based on Cercana, we grew our market share within key categories globally. Our overall POS was down 1% compared to an industry decline of 2.5% in RTAM. As consumer demand declined in the U.S., notably in September. Finmaster Toys recorded positive POS. This was offset by a decline in Melissa and Doug. We grew our market share within preschool, infant, toddler, and plush, driven by strong performance from Ms. Rachel and Gund. We were number one in preschool, where Paw Patrol remained the top property. Within wheels and action, our POS growth was seven times higher than the rest of the industry, driven by Monster Jam and vehicles and how to train your dragon in action. Turning to entertainment, we continued to create new and original IP. We delivered our first of five new Paw Patrol specials this quarter. And we greenlit our first original IP film. This is a major milestone for our entertainment studio. The animated four-quadrant film is directed by David Soren. This adds to our upcoming feature film slate, including Paw Patrol, the dino movie next summer, and the live-action Bakugan movie in development. Within digital games, we had a strong quarter with growth in Tokaboka and Picnic, driven by improved monetization of our platforms. Tokaboka conversion and average revenue per paying user were on track. Monthly active users were down. This was due to competition and our focus on higher spending markets. Picnic subscribers were up, as was retention and ARPU. We also benefited in the quarter from the delivery of Tokaboka Junior Classic games to a third-party platform. Looking ahead to Q4, across our three creative centers, we are well-positioned going into the holiday season. Within toys, in Q3, we were the only manufacturer to have three new toys leading their super category in the U.S. per Sakana. We also have a broad range of brands featured on the retailer's top toys list. In terms of consumer demand, Sakana expects 2025 holiday shopping season to be less predictable and more spread out this year than ever before. Now turning to entertainment. We're celebrating the holiday season with our Paw Patrol Christmas special. It is set to air in the U.S. on Paramount Plus, Nickelodeon, and for the first time ever on CBS Primetime on Black Friday. We've also secured international distribution on streaming platforms and other major networks. There will also be a theatrical screening in 3,600 theaters across 17 countries and territories. In digital games, we have a robust lineup planned for Q4 of new features, content releases, and strategic partnerships, including the recent collaboration with Sanrio. Looking into 2026 and beyond, I believe we have a sound strategy focused on monetizing our core brands and franchises and developing new IP across our three creative centers. However, to date, our execution has not met our ambition. I see an opportunity to increase our baseline of success by focusing on consistent foundational improvements, applying greater executional discipline, and never forgetting that innovation is core to our DNA. Beginning with toys, we have fantastic core brands, including Paw Patrol, Melissa & Doug, Gund, and Kinetic Sand. We are investing to grow these brands through creativity and innovation. A great example is how we created an all-new brand with our digital pets, Bitsy. We have since extended the brand to Bitsy Hamster Ball and licensed versions with Harry Potter, Jurassic World, and Disney, with more to come. This approach to brand innovation and extensions drives reoccurring revenues and ultimately helps us grow market share. We are taking the same approach with Melissa and Doug, the market leader in early learning. The business is primarily evergreen, which is complementary to Spin Master's core toys. Melissa and Doug was in line with expectations in 2024, but it faced challenges in 2025 due to impact of tariffs and competitive pressure. We are executing on a plan to return to growth by driving more innovation and new introductions in 2026 in core categories where we have leadership share, including developmental toys, puzzles, and pretend play. We are also moving M&D into adjacent categories, leveraging its strong brand trust with parents. This includes new extensions like Sticker Wow, which has performed very well, as well as extending into partnerships and licenses, including Disney and Miss Rachel. And we have begun international distribution of M&D using our global infrastructure and expertise to provide retailers with curated lines. Beyond our core brands, we are partnering with leading entertainment companies and continuing to maximize existing long-term relationships. Our current TAM is $50 billion. And we still only have 4% of it. So there is a tremendous opportunity for growth. When we look further out, we are exploring opportunities to move into adjacent high growth categories. Focus on areas where we have the right to win and be an innovation leader. Within entertainment, our focus is simple. Develop and own our IP, be platform agnostic, and meet kids where they watch, play, and engage. We're continuing to invest in Paw Patrol as a priority franchise and expand its universe. 2026 will see the release of the biggest movie yet. We're taking advantage of this across all business lines, including an amazing line of toys and products around the dino movie theme, a series of specials, and new seasons of Paw Patrol and Rubble and Crew to build excitement for the movie release and a new digital Paw Patrol game. We're also building the next wave of original IP, including a big year for Unicorn Academy content in 2026, and a reinvention of Bakugan. Within Digital Games, we have taken deliberate actions to sharpen our focus and concentrate resources on our core two platforms, Tokaboka and Picnic. In Tokaboka World, we are strengthening the overall experience through investing in our tech stack, more frequent features and content drops, and more timely strategic collaboration. This year, we've delivered more content features than ever before, and as a result, we're seeing strength in the bottom of our funnel, specifically in our post. And we're bringing Tokaboka to retail, including a collaboration with Miniso in 2026. This is the first step in fully realizing the brand. Within Picnic, our efforts are centered on subscriber growth and retention. We are continuing to improve the user experience and adding more value to our bundle for parents, soon to include a new app in the reading category. We are diversifying and growing revenue by licensing games to third parties. In summary, our focus across Spin Master will be ensuring creativity, storytelling, and innovation return to being the core of our business. We'll support this by prioritizing funding for product development, innovation, and the overall creative pipeline, being disciplined in our investments, and putting engagement of kids and families at the forefront. We've been successful in establishing a presence everywhere kids are through our three creative centers, toys, entertainment, and digital games. Now it's time to unlock the value across all three and realize the full potential of our brands. With that, I turn it over to Jonathan.