Lifecore Biomedical (NASDAQ:LFCR) held its first-quarter earnings conference call on Wednesday. Below is the complete transcript from the call.

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Summary

Lifecore Biomedical reported a decrease in Q1 2026 revenue to $23.2 million, a 34% decline from the prior year's comparable quarter, primarily due to previously announced headwinds.

Despite the revenue decline, the company reaffirmed its 2026 guidance with expectations of total revenue between $120-125 million and adjusted EBITDA between $20.5-25 million.

Strategic initiatives include signing three new commercial site transfer programs and expanding the development pipeline, with expected revenue generation from these programs by 2028.

Operational highlights include a significant increase in potential customer audits and the successful implementation of a new ERP system to enhance operational efficiencies.

Management expressed confidence in the company's growth strategy, focusing on expanding commercial business, advancing development programs, and maintaining high-quality standards, positioning the company for sustained long-term growth.

Full Transcript

OPERATOR

Good morning and thank you for joining Lifecore's earnings call for the first quarter ended March 31, 2026. During the call, all participants will be in a listen only mode. Now I would like to turn the call over to Stephanie Diaz, Manager of Investor Relations for LifeCore.

Stephanie Diaz (Manager of Investor Relations)

Good morning and thank you for joining us today. Lifecore Biomedical will provide its earnings for the first quarter ended March 31, 2026 and corporate updates as the Company has recently changed its fiscal year end to align with the calendar year. We will be comparing our Results for the first quarter ended March 31, 2026 with a comparable prior year. Quarter ended February 23, 2025 hosting the call today from LifeCorps are Paul Josephs, President and Chief Executive Officer and Ryan Lake, Chief Financial Officer. Before we begin, I'd like to remind everyone that today's conference call will contain forward looking statements. It is important to note that the forward looking statements made during this call reflect management's judgment and analysis only as of today, May 6, 2026 and the Company's actual results could differ materially from those projected in such forward looking statements. For a more thorough discussion of the risks and uncertainties associated with any forward looking statements, please see the disclaimer regarding forward looking statements that is included in our earnings press release which was furnished to the securities and Exchange Commission this Morning on Form 8K and is available on our corporate website at lifecore.com, as well as our other filings with the securities and Exchange Commission, including but not limited to the company's Form 10Q for Q1 2026 which was filed with the SEC this morning and is also available on our website. In addition, our earnings press release include the discussion of and during this call we will reference certain non GAAP financial information. You can find relevant non GAAP reconciliations in our earnings press release. With that, I would like to turn the call over to Paul Josephs, President and Chief Executive Officer.

Paul Josephs (President and Chief Executive Officer)

Thank you Stephanie Good morning everyone and thank you for joining us today. During the first quarter of 2026 we continue to execute on each of the three pillars of our growth strategy, maximizing our existing commercial business, advancing our development pipeline towards commercialization and adding high quality new programs to our pipeline through business development. We believe consistent execution across these pillars positions Lifecore for sustained long term growth, supporting our goal of achieving a 12% revenue, CAGR and EBITDA margins above 25% by the end of 2029. We remain confident in our full year expectations and reaffirm our 2026 guidance Ryan will provide additional details on our financial results. Following my overview of our Q1 achievements, I will begin today with the progress made with each of our growth strategy pillars, starting with our revamped commercial strategy and priority to add high quality programs to our development pipeline. I am encouraged by the progress made with regard to this initiative. As previously discussed, we have transformed our business development strategy and team to expand our target market and drive an increase in the number of high quality customer wins. This effort generated a strong expansion of our pipeline in 2025 and we are encouraged by the continued progress we have seen in 2026. In the first quarter alone, we have signed 3 new commercial site transfer programs. In March, we announced the signing of a manufacturing services agreement for the commercial site transfer of a marketed approved product with a new aesthetics customer. Under the terms of the agreement, we will perform technical transfer activities for a product that is currently manufactured outside the US Our client's goal is to establish U S based manufacturing for products sold in the US this is an exciting opportunity for us with a customer relationship that we expect to grow over time. Importantly, we believe this product may generate commercial revenue in 2028. In addition, during the first quarter we announced the signing of two CDMO manufacturing services agreements with an existing US biopharmaceutical customer. This customer is a publicly traded US based pharmaceutical company that has successfully developed multiple marketed products and continues to drive growth in its commercial pipeline. The first of these agreements is a commercial site transfer under which we will assume manufacturing of a currently marketed product produced by another CDMO. This is a new product to LifeCorp. We will perform technical transfer services required to support regulatory approval at our site. Upon successful approval of this transfer, the agreement provides for the commercial manufacturing of this product at LifeCore. Consistent with previously discussed commercial site transfers, we believe this product may generate commercial revenue in 2028. The second agreement with the same customer reflects an expansion of our relationship. Lifecore currently manufactures this commercial ophthalmic product in one delivery format and will now begin to manufacture it in a second delivery system. This additional delivery system is currently manufactured in Europe. We believe the secondary second delivery system will be additive to our existing commercial revenue for this product. We are motivated to have been selected for all these high value programs as we believe it reflects the continued progress in becoming a partner of choice for our current and future customers. Our unwavering commitment to best in class quality and strong technical expertise are key drivers for those customers that continue to place a trust in us for the development and manufacturing of their important programs. During the quarter, our business development team spent considerable time and effort strengthening our business development pipeline, resulting in a growing number of meaningful meetings with customers and prospects. A meaningful highlight for us was the significant engagement our team experienced with our customers at the recent Drug, Chemical and Associated Technologies or DCAT association meeting in New York. DCAT is our largest and most important sales and marketing event in North America. This year's engagement was unprecedented for us with our team participating in a record number of meetings with both existing and potential customers. Given the strong engagement and the growing momentum of our business development team is building, we believe we are well positioned to capitalize on the positive market dynamics including the growth of manufacturing in the United States and the fact that approximately 50% of the US drug development pipeline our injectable therapies. We believe that this current environment points in our favor and leaves us well positioned to aggressively pursue new business and capitalize on the opportunity in front of us with respect to our first growth strategy, expanding our existing commercial business, we continue to work closely with our commercial partners during the quarter to deliver outstanding service with a clear focus on readying our organization for the doubling of commercial demand with our largest customer, which is expected to begin in 2027. Concurrently, we remain committed to commercial excellence and during the quarter we implemented targeted pricing initiatives to maintain and expand our product margins. Turning to the second growth strategy pillar of advancing development programs to commercialization, we are encouraged about our growing and diverse pipeline. One of the highlights during the quarter was the expansion of our work with Ndomo, a clinical stage therapeutics company. In January of this year, we signed a second agreement with Ndomo, having previously been selected to provide formulation and process optimization activities in support of their DT001 program. Under the terms of our latest agreement, we will be responsible for producing and supplying clinical batches of DT001 planned studies designed to prepare the product for advancement into phase 2 clinical trials in 2026. We also made significant progress regarding our late stage development pipeline which includes 13 late stage programs with the addition of the three programs mentioned earlier in my comments. Five of these programs are commercial site transfers. Unlike development programs, commercial site transfers have existing market demand and are significantly de risked. They do not require additional clinical trials and only require qualification Lifecore, which gives us greater confidence in their financial projections. Given our quality track record and proficiency in producing similar products, we are confident in our ability to successfully transfer all five products to LifeCore. Depending on timing of regulatory approvals, we expect that they will all generate commercial revenue at our site in 2028 it is also important to note that two of our late stage customers nearing commercialization achieved important milestones that support their path towards regulatory approval and commercialization. One of our late stage ophthalmic customers recently announced positive top line phase three results and after securing funding, another customer has a clear and actionable path toward commercialization potentially in 2028. Beyond the achievements specific to our growth strategy, we made meaningful progress across several key areas of our business, including SG&A operations and quality. Within sga, we continue to identify and act on opportunities for cost reductions and intend to continue to implement changes that we will believe will drive sustained margin improvement over time. In addition to our operational achievements during the quarter, we successfully launched our Enterprise Resource Planning, or ERP system in January. To date, this implementation has been smooth and we ultimately expect the system to improve efficiencies in financial management, cost containment, productivity and inventory control. With regard to quality, our commitment to industry leading quality was again demonstrated during the quarter. During the quarter, we completed multiple inspections with new business prospects and existing customers. Each of these inspections had a positive outcome, which we believe further validates LifeCore's growing reputation as a leading CDMO and partner of choice for customers seeking high quality. Importantly, these inspections consistently serve as a learning opportunity for us to and allow us to strengthen our quality systems that are the foundation for all our development and commercial manufacturing activities. During the first quarter of 2026, our team successfully executed against each pillar of our growth strategy. Concurrently, we continue to optimize our organization to drive cost reductions and improve efficiencies to support margin improvement, all while continuing to elevate our quality systems. I am energized by our achievements during the quarter and we remain committed to building on this momentum with discipline throughout the year. That concludes my update. I will now turn the call over to Ryan Lake to provide an overview of our financial results for the first quarter ended March 31, 2026.

Ryan Lake (Chief Financial Officer)

Ryan thank you Paul and good morning everyone. In conjunction with my comments, I'd like to recommend that Participants refer to LifeCorps Form 10Q filing, which we filed with the SEC earlier today. As a reminder, today we will compare our first quarter, which ended on March 31, 2026, with the comparable prior year quarter ending on February 23, 2025. Before providing the quarter's financials, I'd like to state that I concur with Paul's optimism for the path. Pleased to reaffirm our 2026 guidance for Revenue and Adjusted EBITDA. As a reminder for 2026, LifeCore expects total revenue to be in a range of 120 to 125 million, net loss to be in the range of 35.4 to 30.9 million, and adjusted EBITDA to be in the range of 20.5 to 25 million. Turning now to the quarter, revenues for the first quarter of 2026 were 23.2 million, a decrease of 12 million, or 34%, compared to 35.2 million for the comparable prior year. Quarter ended February 23, 2025. The decrease in revenues was primarily a result of the factors we described during our fourth quarter earnings announcement and we remain on track to deliver our stated revenue guidance by the end of 2026. Gross profit for the quarter was 4.5 million, a decrease of 5.4 million compared to 9.8 million for the comparable prior year ended February 23, 2025. The 5.4 million decline in gross profit was primarily due to decreased revenues. Selling general and administrative expenses for the first quarter were 7.9 million, a decrease of 2.1 million, or 21%, compared to 10 million for the comparable prior year. Quarter ended February 23, 2025 SGA decreased by 2.1 million, driven by 1.6 million of lower recurring leg accounting costs, lower compensation and lower credit losses, and 0.5 million of lower non recurring expenses primarily related to legacy legal matters. The Company recorded a Net loss of $15,000,043 of loss per diluted share as compared to a Net loss of 14.8 million and 42 cents of loss per diluted share for the comparable prior year. Quarter ended February 23, 2025. Adjusted EBITDA for the quarter was 1,000,000, a decrease of 4.7 million compared to 5.7 million for the comparable prior year. Quarter ended February 23rd, 2025. The decrease in adjusted EBITDA was primarily due to the decrease in revenues and was partially offset by favorable operating expenses. We are pleased with the Company's financial performance during the first quarter and remain on track to achieve the guidance that I reiterated at the beginning. Comments Today I'm pleased to report that the first quarter of 2026 represents the sixth consecutive quarter of period over period Declines in SGA and R and D Expenses since initiating our expense reduction initiatives in late 2024, LifeCore's SGA and R and D expenses have been reduced cumulatively by almost $8 million, including substantial reductions in accounting, consulting and legal expenses. These reductions drove the incremental improvements we recorded in EBITDA margins during 2025 and as reflected in our 2026 guidance. We expect continued reductions to support that trend in the future. I'd now like to turn to liquidity, which has improved significantly since late 2024. We ended the first quarter of 2026 with overall liquidity of approximately $38 million, including approximately 21 million in cash and cash equivalents and approximately 17 million of availability under our revolver. Importantly, the first quarter of 2026 marked our fifth consecutive quarter. Generating positive cash flow from operations and excluding the registration rights payment in the fourth quarter of last year represents the fourth consecutive quarter of being free cash flow positive. During the first quarter of 2026, we generated $4.7 million in cash from operations and free cash flow of $3.6 million. We are pleased with the improvements we've been able to achieve since late 2024, and we remain committed to further strengthening our financial standing with continued expense reductions and strategic financial management going forward. This concludes my financial review. I'll now turn the call back over to Paul for his final comments.

Paul Josephs (President and Chief Executive Officer)

Thank you, Ryan. During the first quarter, we believe that we continue to demonstrate that we are on the right path. We executed against our growth strategy, supporting our clients as they advance towards commercialization, expanding our capacity and capabilities to meet growing demand, and addressing new modalities, and aggressively pursuing and winning new business opportunities. In addition, we continue to strengthen our organization by driving efficiencies, improving our cost discipline, while maintaining exceptional quality. As a foundation that supports everything that we do, we believe we are well positioned to achieve our 2026 objectives and have a clear strategy that we have built and are continuing to make progress that give us every reason to look forward to our midterm goals with great optimism. This concludes our prepared remarks for today. Operator. You may now open the call for questions.

OPERATOR

Thank you. As a reminder to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. One moment for questions. Our first question comes from Michael Patuski with Barrington Research. You may proceed. Hey, good morning, guys. Congrats on all the progress related to the new contracts, et cetera. So, Ryan, I guess I wanted to get at the sort of the numbers and how that connects to the full year guide. Both the revenue and EBITDA came in sort of meaningfully below what we were expecting. And it just feels like the decline in Q1 was considerably above sort of the. You know, certainly the run rate of the headwinds that you guys identified. Last conference call meaning 12 million down this quarter versus I believe it was something like an $18 million headwind for the full year. Can you sort of help me bridge that and just talk about maybe how this plays for the rest of the year in terms of are you expecting sequential revenue growth? Like how, you know, percentage of revenue in second half versus first half? Can you just speak to some of that? Thanks.

Ryan Lake (Chief Financial Officer)

Thanks, Michael. So I guess maybe to start with the second part of your question first, and as we communicated on the year end earnings call, we expect revenue to roughly be in the mid 40% range in the first half of the year and then in the mid 50% range in the second half of the year. So that hasn't changed. I think that it's really just timing or split between Q1 and Q2. So I think in terms of the way that you're looking at some of your models, I think it's basically just pushing, you know, that, that I guess miss for Q1 and putting that in Q2. We didn't give specific guidance previously between the breakouts between and Q2, but I'd say largely we're still on track for that mid 40% range in the first half and then mid 50% range in the second half. And I would also say just from an EBITDA perspective, you know, we remain kind of committed to that in terms of, you know, roughly, you know, split in the 40% range in the first half for adjusted EBITDA and 60% range in the second half. As far as some of the items that we communicated year end in terms of the headwinds with regard to one of our customer supply chain initiatives as well as the termination of agreement, I'd say, you know, a big part of that is really front loaded into this year in terms of timing and comparison. So I want to say like 50% of that was roughly in Q1. And I think as we look at the first half of the year, roughly 80% of that impact will be kind of bled through the financials. Okay. All right, that's super helpful. Okay. So Paul, I guess one of the, I guess to me one of the early indicators in terms of future success for you guys is getting folks to Chask. Can you just talk about potential customer traffic in Chaska to whatever extent you can? I mean, are you seeing sort of a pickup relative to where it was 612 months ago is the quality of the projects that are potentially being looked at. Can you just sort of talk, I guess to, you know, traffic in terms of getting folks to travel to Minnesota and just the potential customers you're talking to?

Paul Josephs (President and Chief Executive Officer)

Thanks oh, Michael, thank you for the question. Yes, we're very encouraged and energized by the amount of traffic that we're seeing from potential new customers. Not only from a business perspective, but, you know, a key or a leading indicator of new business is, you know, quality audit. So, you know, we have a significant increase in the number of audits that we're seeing from prospective customers. And now we're actually into mid June before we're able to entertain audits from new customers. So that gives me great optimism. And in fact, you know, we'll have the CEO or US CEO of a large multinational in our site this week, you know, talking about new opportunities. So, you know, the quality of visitors that we're seeing from on the business side is up, and the increase in the number of audits are up from prospective customers as well, which give us, you know, again, as leading indicators of new business or they're trending in a positive manner.

OPERATOR

Okay, very good. Thanks, guys. Appreciate it. Thank you. Our next question comes from Matt Hewitt with Craig Hallam Capital Group. You may proceed.

Paul Josephs (President and Chief Executive Officer)

Good morning. Thanks for taking the questions regarding that pipeline, that increasing pipeline. You noted that the aesthetic win the tech transfer was because they were looking to onshore manufacturing here in the United States. I'm curious, as you look at your pipeline, as you look at the existing tech transfers as well as those that are in the pipel pipeline, how much of that is a function of the tariffs and the desire to repatriate or to add manufacturing here in the States versus how much of it is because of the market that you serve, the sterile injectables and some of the capacity constraints that that market is facing globally. Matt, thanks for the question. I think it's meaningful. Certainly not the majority, but, you know, I say maybe low double digits as it relates to reshoring. So it's a meaningful part of it. The other thing that's really manifested itself, if you don't mind me conflating this answer, is, you know, there is meaningful FDA enforcement or increase in FDA enforcement or actions that is going on in the industry. So, you know, when I think about high quality and maybe some of these situations that our competitors are in with regard to warning letters or FDA enforcement that has also increased the opportunity for a company like Lifecore, which has a high quality track record. So as I think about, you know, the site transfers, it's not only now the reshoring, but it's also the opportunity to take advantage of the regulatory market because we think that's a strong tailwind based on our quality systems led by Jackie Klecker or EVP Equality. So it's exciting times for us and we're energized moving forward.

Matt Hewitt (Equity Analyst)

That's helpful, I guess, maybe just to extrapolate on that a little bit. With some of your peers facing and in some cases warning letters, does that create an opportunity for maybe some of these or one of these at least tech transfers to accelerate? Meaning instead of having to go through the full 18 plus month process, the FDA recognizes, hey, we're going to be in a shortage situation if we don't address this faster and maybe they help move things along a little bit faster. I think we saw that with some bags a couple years ago where they basically knocked down some of the barriers to get product to market faster because of some, you know, companies that were having issues.

Paul Josephs (President and Chief Executive Officer)

Thanks for the question, Matt. Certainly it's a possibility, you know, as I think about one opportunity within our pipeline. There, there may be that opportunity, but you know, it's. That is something that Lifecore doesn't necessarily control. It's on our, it's, it's really within the control of our, of our customers as we partner with them on their regulatory strategy. So nothing that we could say today that would point to an acceleration of anything within our pipeline, but certainly something that may become a reality in the future.

OPERATOR

Got it. All right, thank you. Thank you. Our next question comes from Mac Etoch with Stevens. You may proceed.

Hannah

Hey, good morning. This is Hannah on for Mac. Thanks for taking my questions. HA performance was relatively strong this quarter and carries a higher margin profile for you guys. So were there any production inefficiencies, scrap or other dynamics that you would point to that may have impacted this?

Ryan Lake (Chief Financial Officer)

Nothing specifically, Hannah, to call out for the quarter in terms of fermentation production. Nothing in particular there. I mean, I would say. And maybe just to reiterate a prior comment, we do have good visibility in general to our revenue coverage for the year. I think about 85% from an aseptic volume perspective, we have firm POS for. And then I think from, from an HA side it's close to 100% PO coverage for the year, which gives us, you know, great confidence in the guidance that we've put out.

Hannah

Thanks, that's helpful. And then given demand Trends across onshoring, GLP1s, et cetera, how do you view current industry capacity for injectable fill finish?

Paul Josephs (President and Chief Executive Officer)

And I think for the question, I would say this, that as it relates to pre filled syringes and cartridges, there still remains opportunity where demand exceeds current available capacity for your traditional vials that where you're supported, whether it's your flu vaccine or COVID vaccine, etc. There remains a lot of capacity because of the, the drop in Covid demand and where we're seeing the majority of our pipeline is in the pre filled syringes and cartridges.

Hannah

Awesome. Thank you. I'll leave it there.

Paul Josephs (President and Chief Executive Officer)

Thank you.

OPERATOR

Thank you. Our next question comes from Max Mock with William Blair. You may proceed.

Christine Raines

Hi, it's Christine Raines on for Max. Good morning and thanks for taking our questions. Ryan, maybe a question for you. You pointed a pretty significant sequential uptick in Q2 revenue, primarily a result of the timing. And I believe you said that half of the impacts from the three headwinds you announced last quarter impacted Q1. So very helpful context there. But also I think you said that 80% of the headwind is expected in 1H. So expect. Correct me if I'm wrong here, but it sounds like another outsized, roughly 30% headwind will impact Q2. So really hoping you can talk through what the offsets from a timing perspective are there on the positive and what gives you confidence in the sequential growth next quarter.

Ryan Lake (Chief Financial Officer)

Thanks, Christine. Yeah, I mean at this point, right, we have all orders in for the quarter, for the second quarter, so we've got really good visibility to that. And you know, I think at the midpoint of the guidance, it's roughly, you know, in the 32 to 34 million revenue range.

Christine Raines

Got it. Thanks, that's helpful. And then congratulations on the new wins. Hoping you can discuss the potential incremental revenue to 2028 from each of. I believe there was three commercial tech transfers that you announced since last quarter.

Ryan Lake (Chief Financial Officer)

Yes, Christine. So the three that we signed, we believe that they would generate commercial revenue in the 2028 time frame. And those programs, as we think about those, they would be mid seven figure opportunities for.

Christine Raines

Great, thank you. And then just one last one. Last quarter you pointed to modest revenue growth expectation for 2027, but talked about how this could be impacted either positively or negatively by timing or outcomes of your customer programs. So now that you have another quarter on your belt, hoping maybe you can put a finer point on this or help us frame out a range of possibilities or even just what the most important levers are that are influencing how this, this outlook ultimately shapes up.

Ryan Lake (Chief Financial Officer)

Yeah, Christine, So you know, again, we're not providing guidance for 2027 at this point. Certainly as we get further in the year, I think we'll, we'll see some of Those things I think importantly when you look at, you know, our 30 plus development programs, a number of very key important milestones associated with each of those programs this year where you know, a lot of those customers are either waiting for clinical results or we're doing some very late stage manufacturing work. So for example PPQ batches for those customers, we'll get a better sense of timing, of not only of success of those products, what their commercial strategies are that will help inform those outlooks for 2027. And I would also say, right, like we do not have some of the forecasts from our customers that go through out into 2027 and through 2027 yet. So as those become clearer and as we start to inflect on the more than doubling of volumes with our largest customer, we'll be able to provide that additional clarity.

Christine Raines

Great, that's helpful. I had to try to sneak in the guidance one, but thank you for taking our questions.

OPERATOR

Thank you. Our next question comes from Paul Knight with KeyBank. You may proceed. Hi Paul, Are you having most success in auto injector pen or a pre filled syringe?

Paul Knight

Pre filled syringe, Paul, what's driving that? You know I think it's a lot of you know the, just the trend in healthcare moving more to the patient and away from the hospital and the clinic. But so you know that seems to be where the majority of the therapies, therapeutic modalities are going to, you know, moving away from your traditional vials that you have to, you know, either go to the hospital or the doctor to at every point to get your injection. So I think that's really what's driving it. And that's why I think 50% of the injectable pipeline is, excuse me, 50% of the US drug pipeline is injectable. It's more taking into the more home health care related is how I see it. And then with a 45 million I

Paul Josephs (President and Chief Executive Officer)

believe capacity at your facilities, is that a gating factor for some customers? Is 45 million adequate?

Paul Knight

That's a great question. I think that as I think about it, certainly if somebody has an immediate, I'll just make give you an example, 100 million unit GLP1 opportunity. LifeCore is not the immediate partner of choice for that. Now we have optionality to grow into what we call site three to meet those growing needs if necessary. But there'd be timing related aspects to that. I think where we fit a nice role in this market is for boutique mid sized opportunities where somebody there's a level of complexity and technical expertise that's required in development and commercial manufacturing in volumes that range from 5 to 10 million units of market demand. And we're seeing that there's just a great growth in our pipeline. And Mark Delphonsica, our chief commercial officer, and his team are doing a great job of continuing to expand and build

Paul Josephs (President and Chief Executive Officer)

upon our current pipeline and within your distribute your sales group. Any changes in that group?

Paul Knight

We continue to optimize and upgrade that group. Paul, you know, we want to ensure that we have the best possible talent in those roles to drive meaningful and impactful opportunities into our site. So, you know, we've made some minor changes in over the past quarter to continue to upgrade our talent.

Paul Josephs (President and Chief Executive Officer)

Okay, thank you.

OPERATOR

Thank you. I would now like to turn the call back over to Paul Josephs for any closing remarks.

Paul Josephs (President and Chief Executive Officer)

Thank you, operator.

OPERATOR

I wish to thank all of LifeCore's stakeholders and supporters, including our investors, customers and collaborators, for their ongoing support and partnership. I also wish to thank our dedicated employees for their commitment to our success as well as the success of our customers. We are very pleased with the progress made during the first quarter of 2026 and look forward to future success and the growth ahead. That concludes our call today. Thank you for participating.

Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice.