Ryan

Ryan asked about Arlo's shelf share expansion at Walmart and the competitive landscape, particularly concerning the increasing presence of home security cameras from China in the U.S. market. He sought Arlo's perspective on potential further share gains and any feedback from retail partners regarding this competition. Additionally, Ryan inquired about Arlo's expectations for 2026 unit volumes and overall consumer demand, given the strong performance in 2025.

Answer

CEO Matthew McRae confirmed that Arlo captured additional shelf share at Walmart and other retailers with its recent product launch, with plans for new product SKUs and expansion into additional retailers over the next 6-9 months. He noted a trend among key retailers to consolidate brands, where Arlo expects to maintain and potentially increase its share. McRae also highlighted ongoing federal and state-level investigations into certain Chinese camera brands, which could block imports and open up 10-20% of the U.S. unit volume for capture, for which Arlo is strategically positioned. Regarding 2026 unit volumes and consumer demand, McRae stated that while third-party data suggests a flat to 5-10% market growth, Arlo aims to grow faster by capturing share and has observed a stronger start to the year in consumer demand than anticipated, supporting its annual operating plan.

Ryan asked about Arlo's potential for further shelf share gains at Walmart and other retailers, particularly in light of increasing competition from Chinese home security camera brands and any related discussions with retail partners. He also inquired about Arlo's outlook for 2026 unit volumes and overall consumer demand, seeking insights into current market trends.

Answer

CEO Matthew McRae stated that Arlo expects to capture additional shelf share through new product SKUs, expansion into new retailers, and a trend among key retailers to consolidate brands. He highlighted ongoing federal and state-level investigations into certain Chinese brands, which could block imports and open up 10-20% of the U.S. unit volume for capture, for which Arlo is strategically positioned. Regarding 2026 unit volumes, McRae noted that third-party data suggests a flat to 5-10% market growth, but Arlo aims to grow faster by capturing share. He observed stronger consumer demand year-to-date than third-party data suggests, supporting their annual operating plan.

Ryan asked how a positive EXPAND readout might impact label expansion given its basket trial design, and the diagnosis rates for biliary atresia and other indications within these additional settings.

Answer

CEO Chris Peetz stated that the label indication would likely reflect the basket design, defined by exclusion of larger settings. He added that in pediatric settings, these conditions are highly symptomatic and well-diagnosed, driven by compassionate use requests, indicating a well-tracked patient population.

Ryan asked about the pace of new PFIC patient additions in Q3 2025 compared to Q2 2025, particularly concerning genetic testing and new diagnoses. He also sought insights into Mirum's business development strategy for adding more products to the pipeline, given consistent positive cash flow and upcoming launches.

Answer

President and COO Peter Radovich stated that the pace of PFIC adds remains healthy and broad, spanning infants to adults, driven by ongoing educational efforts to change the paradigm among adult providers regarding genetic cholestasis. CEO Chris Peetz emphasized that business development is core to Mirum's strategy, focusing on underappreciated programs with a high bar for value creation, but noted there is no urgency due to the company's strong financial position.

Ryan asked about the dynamics behind the increase in SG&A observed in the fourth quarter. He also requested updates on the EPX-200 program and when more information might be available.

Answer

Sandip Kapadia, CFO and Chief Administrative Officer, attributed the Q4 expense increase primarily to R&D investments for the Phase 3 IH and narcolepsy HD programs, continued WAKIX commercialization costs, and ANDA litigation and settlement expenses. He noted that R&D expenses are expected to increase further in 2026 with 5-6 registrational studies. Kumar Budur, Chief Medical and Scientific Officer, stated that pre-IND work for EPX-200 (liquid lorcaserin) is ongoing, highlighting its selectivity for 5-HT2C, extensive safety/tolerability database, and existing efficacy data in DEEs, with a goal to leverage this data for an accelerated development program.

Ryan inquired about the dynamics behind the increase in SG&A expenses observed in Q4 2025 and requested any updates on the EPX-200 program.

Answer

Sandip Kapadia, CFO and Chief Administrative Officer, attributed the increase in Q4 expenses primarily to R&D investments for new Phase 3 studies (IH and narcolepsy for HD program), continued WAKIX commercialization costs, and ANDA litigation and settlement expenses. He noted that litigation expenses were largely under G&A and that R&D expenses are expected to increase in 2026 with five to six registrational Phase 3 programs. Dr. Kumar Budur, Chief Medical and Scientific Officer, stated that EPX-200 (liquid lorcaserin) is undergoing pre-IND-related work, aiming to leverage existing efficacy and safety data, including a long-term cardiovascular outcome study, for an accelerated development program in Developmental and Epileptic Encephalopathies.

Ryan asked for a dollar-wise breakdown of productivity gains and cost cuts embedded in the 2026 guidance, distinguishing between carryover benefits from 2025 and new actions. He also sought clarification on the drivers behind Asia's strong organic growth in Q4, specifically if it was due to semiconductor or packaging exposure.

Answer

Jamie Beggs, Senior VP and CFO, explained that productivity initiatives, including sourcing and footprint optimization, yielded over $40 million in net productivity in 2025, with about half carrying over to 2026. New actions will be enacted based on demand, with net inflation for 2026 estimated at $30 million. Ashish K. Khandpur, President and CEO, attributed Asia's Q4 growth to market share gains in food and beverage packaging in Greater China (33% of Asia's business) and double-digit growth in high-performance computing materials for semiconductor chip and wafer packaging.

Ryan asked for a bridge from Q1 2026 through the balance of the year, specifically if it's right to think about EBITDA being down high single digits in Q1, flat in Q2, and high single-digit growth in the back half as Refinish and Industrial normalize. He also asked for more details on Commercial Vehicle (CV) dynamics, noting recent positive Class 8 orders and whether inventory needs to be worked through before better build rates in H2.

Answer

CEO Chris Villavarayan confirmed that the proposed EBITDA trajectory (down in Q1, flat in Q2, growth in H2) is a good way to think about the year. Regarding CV, he acknowledged recent positive Class 8 order trends and an upward revision by ACT to 270k builds, but noted FTR hadn't reflected this yet, indicating a cautious guide. He suggested potential upside in CV due to higher margins and stated that inventory levels are at standard levels, with no excess at OE retail.

Ryan asked about the incremental partner-sourced pipeline, particularly from the Deloitte partnership, and how these partnerships might drive AI-related product deployments. He also inquired about UiPath's OpEx investment strategy for the next year to support AI product rollout and monetization.

Answer

CFO Ashim Gupta stated that the quality of partner-sourced pipeline has increased, with partners like Deloitte involving UiPath in larger-scale S/4HANA transformation processes, which is a leading indicator of future success. Regarding OpEx, he explained that leverage is achieved through discipline and prioritization, allowing investment in engineering, sales capacity, and customer-facing roles while driving efficiency across other cost structures.

Ryan asked about the differences in the refinish market dynamics between the U.S. and Europe, and which segments of the market PPG is gaining share in.

Answer

CFO Vince Morales explained that U.S. insurance premiums are significantly higher, leading to different claims rates compared to Europe, where claims more closely parallel accident rates. Chairman and CEO Tim Knavish stated that PPG is gaining share across both the U.S. and Europe, driven by its digital and chemistry productivity solutions. He added that PPG is re-expanding its revenue pie through PPG-specific, subscription-based, and volume-agnostic offerings that provide customer productivity.

Questioned the levers for future margin improvement beyond current initiatives, the final steps before the Beam Spot product launch, and the expected timeline for it to become a significant revenue contributor.

Answer

Future margin improvements will come from scale, further engineering/operational efficiencies, stabilizing component costs, and learnings from the European team, with a long-term goal of 50% gross profit. The Beam Spot product has key components integrated, with the first prototype installation in San Diego expected in the next couple of months, followed by aggressive marketing. Meaningful revenue from Beam Spot is anticipated in 2025.