mineral fiber AUV, as well as positive wave equity earnings. Higher manufacturing was largely driven by first quarter costs in the AS segment. The increase in input costs was driven by freight, raw materials, and energy inflation. SG&A increased primarily due to continued investments to support growth and the inorganic impact from recent acquisitions. Adjusted diluted net earnings per share grew eight percent driven by both higher net earnings and a lower share count resulting from increased share repurchases on slide 10 we present our year-to-date adjusted free cash flow performance versus the prior year the nine percent increase was driven primarily by higher cash earnings and dividends from our wave joint venture we also present our year-to-date capital deployment where we have demonstrated the execution of, and our commitment to, our capital allocation priorities, which are investing back into the business, pursuing strategic acquisitions, and returning value to shareholders. And as you can see, we are executing on all of these fronts in 2026. In the second quarter, we paid $15 million of dividends to our shareholders and repurchase $75 million of shares, bringing our year-to-date dividends paid to $30 million and our year-to-date share repurchases to $135 million. Additionally, just last week, our board approved and we announced an increase to our existing share repurchase program, adding an additional $800 million of authorization and extending the program through 2029. This reflects the fundamental strength of, and our confidence in, our business model and its ability to consistently generate strong, adjusted free cash flow. Turning to slide 11, given our solid financial performance, we are raising our full-year guidance midpoints across all key metrics. We now expect total company net sales growth of 9 to 11 percent, up from the previous range of 8 to 10 percent. We have slightly raised our full-year mineral fiber net sales growth assumption to approximately 7%, with about one point of volume growth driven by strong execution and benefits from growth initiatives, along with AUV growth of approximately 6%. In the AS segment, we are slightly raising our full-year net sales growth assumption to 15% to 17%. We are also increasing the midpoint of our total company-adjusted EBITDA guidance. and now expect growth of 9% to 12% for the full year, up from our prior guide of 8% to 12%. We continue to expect adjusted EBITDA margin expansion in both segments for the full year. In mineral fiber, we expect an adjusted EBITDA margin of approximately 44%. In AS, we expect an adjusted EBITDA margin of approximately 19%. And on an organic basis, we now expect an AS adjusted EBITDA margin of approximately 20%, which is a slight increase from our prior assumption. Additionally, we are increasing our guidance for adjusted diluted net earnings per share growth to a range of 12% to 15%, up from our prior guide of 10% to 14%. We are also increasing our guidance for adjusted free cash flow growth to a range of 10% to 14%, up from 9% to 14%. Please note that additional assumptions are available in the appendix of this presentation. We are pleased with our performance through the first half of the year, and we remain well positioned to continue to deliver profitable growth and create value for our shareholders. And now I'll turn it over to Mark for further commentary. Thanks, Chris.

As Chris shared, we are pleased with the results we've delivered so far in 2026, the consistent market conditions we're experiencing, and the momentum we're building with our growth initiatives. Looking forward to the second half of the year, we're hearing on-the-ground commentary from our customers regarding bidding activity and demand trends that's consistent with what we heard in the first quarter. While underlying market conditions have improved slightly from 2025, they remain muted, in part due to ongoing macroeconomic uncertainty. That said, within the verticals we serve, there are clear pockets of strength in transportation, data centers, and health care. And the diversity of our end market verticals and project types, including new construction, major renovation, and repair and replacement, support the resilience of our business. as these areas rarely move all in the same direction at the same time. Our consistent ability to grow profitably goes beyond the diversity of our end markets, operational execution, and our legacy position within the ceilings category. It is also driven by our proven track record of acquiring companies to strengthen and expand our architectural specialties portfolio of products and capabilities. With the Eventscape acquisition earlier this year, we've completed 15 AS acquisitions and expanded our addressable market well beyond the traditional ceiling, plain, and commercial buildings. To illustrate that point, I would like to call out a recent event that highlights how we are maximizing the power of our portfolio. Each June, architects and designers from around the world gather at the Mart in Chicago for Neocon, the leading event for the commercial interior design industry. We have participated for several years at this event through some of our AS brands, such as Turf and Arctura. This year, for the first time, we created an Armstrong-branded showroom, showcasing the full range of both mineral fiber and AS ceilings, specialty wall, and architectural solutions. This space demonstrated how our industry-leading breadth of products supports the increasing complexity of modern design by balancing intricate aesthetics, multifunctional performance, and sustainability attributes. Neocon provided an energizing platform for us to engage directly with thousands of architects and designers, reinforcing and in some cases introducing the Armstrong brand at the forefront of interior architectural solutions. From the beginning of our journey to expand into specialties, we believed our leadership in mineral fiber ceilings gave us a strong platform from which to expand and generate consistent profitable growth. With our leading portfolio and enhanced capabilities, we now compete for more specifications and win more projects in more spaces within every commercial building. I personally attended Neocon this year, together with dozens of leaders from across our enterprise, to see the range of our offerings prominently on display and to celebrate several best of Neocon awards, including innovation and business impact awards for Temploc. In the process, I also saw the power of our people coming together to unite, collaborate, and elevate how we show up for our customers and in the industry. It was an inspiring experience and one that the entire Armstrong organization can and should be proud of. With our talented organization energized, focused, and executing, and with our resilient business model and consistent growth strategy, we are well positioned for a strong second half of 2026 and to continue creating value for our shareholders. Underscoring that point, as Chris noted in following the review and approval of our strategic plan last week, our Board of Directors approved an expansion and extension of our share repurchase program, reflecting both the consistency in our capital allocation priorities and continued confidence in our strategic direction. Now the operator will begin the Q&A session.

We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Susan McClary with Goldman Sachs. Your line is open. Please go ahead.

Thank you. Good morning, everyone. And thanks for taking the question.

Good morning, Susan.

Good morning. I want to start with the comment about the strength in the order rates that you're continuing to see coming through the business. Can you give us some more details on that? You know, how you're thinking about it across the various verticals and what that means for the second half of the year, and then maybe even just looking further out.

Happy to, Susan. Thanks for the question. So my comment was focused specifically on AS, so intake where we've got very clear visibility into projects and the pipeline there. So the double-digit intake, again, this quarter reinforces what we've seen over the last several quarters, which is now roughly our fourth consecutive quarter of double-digit intake in AS. That's supporting the pipeline, that's supporting our outlook for the second half, and frankly starting to give us some visibility into 2027 as well. That pipeline is broad-based, and it reflects both new construction projects, it reflects renovation projects, and it's also across both a wide range of verticals, particularly We mentioned transportation in our prepared remarks, but also office, office, also health care, also education. And importantly, it's across all of our categories. We talk about AS categories, and whether that's metal or felt or wood, it's broad-based there. We're not over-concentrated, I would say, in any one particular AS category. So recent intake's been very strong. We track that also on a trailing 12-month basis, and we believe it's very supportive of our outlook for the back half.

Okay, that's great. That's very helpful. And then my follow-up question is, you know, it's great to hear the traction that you saw at Neocon this year with your Armstrong-branded showroom. Can you talk a bit more just about some of the feedback that you got from clients and maybe even other people that toured the showroom, and how we should think about that contributing to the business and being a part of this longer-term growth initiative that you have and what it means not just in terms of AS but also perhaps for mineral fiber and the volume flow there.

Yeah, thanks for that. It's a really important point because it was not just a specialty showcase. The portfolio, when we talk about the power of the portfolio, we're talking about the collective enterprise at Armstrong, And we think of our enterprise as one business squarely focused on ceiling and wall solutions. And that's really what we were trying to put on display at Neocon this year. And I think the number one consistent theme we heard from the thousands of folks who went through our spaces was impressed by the breadth and the diversity of the offerings and the capabilities. whether that's in materials or performance, aesthetics, that sort of broad-based solution set. And we like to think of it really as a palette for architects and designers to work from. And in some ways, that showcase was really our strategy on display, if you think about it. I mean, AAS has been built and developed over the years as a complement to the mineral fiber business, and the two of them work well together. We win more jobs and we win more spaces whenever we have mineral fiber and AS on a project. And that's what was being showcased there. And I think what you're seeing in our recent results, what you're seeing in these kind of larger projects, we talk a lot about transportation, is really reflective of that. You bring the portfolio and the power of it through our channels, through our access to markets, and that's how the two complement each other.

Yeah. Thank you for all of that. color, and good luck with the quarter.

Thank you, Susan.

Your next question comes from the line of Tomo Sano with J.P. Morgan. Your line is open. Please go ahead.

Hi, good morning, everyone. Good morning, Tomo. Thank you. On mineral fiber, your fiscally assumptions imply 1% volumes grows. Given the volumes were up in both first quarter and second quarter, we should expect the volumes to accelerate or decelerate of flat use in second half. And if you could give us more color on end market channel inventories and market share perspectives in a back half, please. Thank you. Thank you, Tomo.

Yeah, we're out looking a fairly consistent volume performance. As we talked earlier in the year, we were talking about a positive first half, a positive second half. We think we're well on track for that with the performance the last two quarters. And frankly, four out of last five quarters, we've demonstrated positive volume growth. And that's our outlook for the back half. So consistent volume growth across the portfolio driven primarily by, I'd say, our commercial distribution channel, which is really where we're showing a lot of traction. I think the portfolio breadth and the product strength, particularly at the high end, like I mentioned in my remarks, the SWAT portfolio is playing really well to the verticals that are in play there, and we're serving that demand very effectively. So consistent volume performance for the year and consistent volume is a priority for us, as we've mentioned, and we expect to continue to demonstrate that.

Thank you. Follow up on recent acquisitions, including EventScape. What is the strategic power of bringing these businesses into the AWI platform? Commercial like pull through or spec end with the architects and designers and channel access. Could you talk about key synergy levers and integration KPI, if you could? Thank you.

Yeah, and you mentioned eventscape, Tomo. I'm going to expand that a bit and extend it to companies like Zainer as well, who have these unique design capabilities. They have access to projects and they have access at the sort of design assistance stage of a project than is earlier than our traditional access to projects. So one of our key KPIs, as we integrate them, is focusing on the transfer function that can happen between those businesses when they have their early access and the rest of our portfolio, to give insights into project activity, to make connections with designers, to introduce the broader part of the portfolio, and again, sort of as I was commenting about Neocon, open up the rest of the portfolio as a solution set for that designer at that earlier stage. And we're seeing that. I'll give you an example from this past quarter. We actually highlighted a project with our board where a fairly prominent project, high-profile project, and the first awareness we had of that project came from Zaner. and they actually had a toehold on an interior metal application and that was ahead of the entire rest of our portfolio and as a result of that toehold we were able to pull through five other solution sets including mineral fiber grid solutions and other parts of the as portfolio that's an advantage to zaner having been in early and we see that same advantage in what eventscape does with their design capabilities. And so we're going to try to harness the power of that access and then transfer it into the rest of the portfolio to win more share.

The only thing I'd add that, Tomo, too, on the metric side is, you know, we have robust business case financials that we put together as part of our investing decisions. And so we continue to monitor those on a monthly basis and performance opposite those those business case financials as part of that metric set that Mark mentioned as well.

Thank you, Mark, Chris. Thank you, Tomo.

Your next question comes from the line of Adam Baumgarten with Vertical Research Partners. Your line is open. Please go ahead.

Hey, guys. Just kind of talking about demand and you highlighted kind of some of the higher end or swap products as being strong. Is that consistent across all the end markets where you're seeing strength that the high ends outperforming?

It is. That's a fair point. We are seeing it consistently across our markets, consistently across our verticals. We think it's on trend, frankly. The aesthetics and the performance in those products is attractive across all of those. So that's not isolated from a market point of view or a vertical point of view.

Okay, great. And then just in the back Cap, do you expect any additional IEPA refunds?

Nothing. Nothing material. No, we're not. Okay, great. Thank you.

Your next question comes from the line of Keith Hughes with Truist. Your line is open. Please go ahead.

The question really, you talked more about data centers, it was called, and we've heard in a while with some growing backlogs. Can you talk specifically what products work best in data centers? Is it just grid or is it mineral fiber? Is there a specific mineral fiber you sell into that occupancy?

Sure, Keith. Happy to take that. So, it's not just grid, to answer your question directly. The way we think about it is grid and tile have been going into data centers for a long time. We sort of bifurcate the structure of the data center into front of house and back of house, back of house being the compute side of the data center. Our front-of-house mineral fiber and traditional acoustical grid, we'll refer to it that way, has been servicing that need for a long time. So we'll continue to see that, and that varies by product application. It could be our SWAT products. It could be our mid-tier products on the tile side supported by a traditional acoustical grid. In the back-of-house, you get much more variation and much more demand for a more structural solution, so not the traditional acoustical grid. But some of the heavier-duty structural solutions that we've launched just recently out of the Wave Venture, products like the Dynamax-branded line of structural grid solutions, containment solutions there. And when there is a tile application in the back of house, and there can be tile applications, it's often a product that has an acoustical, not so much an acoustical, but an air management attribute to it, so a gasketed tile. And again, it could be a variety of our mineral fiber products serving that tile need. It could also be our new data zone tailored product offering, which was created specifically for data center applications and has a slightly higher AUV to it. So it's varied, Keith, across, and it's really dependent on the specifier, largely the owner in a lot of cases.

Okay. The final question on this. Is there any interest in that occupancy on TempLock, given that cooling those facilities down is a major deal for them?

There is interest in it. In fact, our commercial teams have been doing a really good job of introducing TempLock to data center applications and selling, frankly, everything I just mentioned to you as a solution with TempLock as a key component of it. So we do believe there's an application for it there. And Pemplot carries multiple value propositions, energy savings, there's thermal dynamics to it, there's tax eligibility for incentives. So we've got a value proposition that we are pitching there, absolutely. Okay, thank you. Thank you, Keith.

Your next question comes from the line of Rafe Jadrasich with Bank of America. Your line is open. Please go ahead.

Hi, good morning. Thanks for taking my question. I was wondering if you could talk a little bit more about the drivers to the revenue guidance increases. How much came in just the second quarter being better versus the second half? And if you could just give some specifics on are you seeing better end market trends? Are you gaining more share? And then what's driving that?

Yeah, thanks for the question. And I'll take that and then I'll hand it over to Chris as well. I think the overarching message is the increase in our guide is largely as a result of the second quarter performance, and we're seeing a consistent back half to what we expected. So carrying forward, we're going to expect market conditions to be consistent with what we've seen in the first half, and we expect our commercial execution, we expect our growth initiatives to continue to perform and deliver that outcome.

Yeah, and maybe just to unpack that top-line change a little bit more, that $20 million increase in sales at the midpoint, about two-thirds of that is really driven by AS performance and about a third for mineral fiber. And as Mark mentioned, again, both on second quarter performance versus our expectations. The fall through, you know, versus our typical margin profile that we see is pressured a little bit due to, you know, some ongoing investments in SG&A and the freight inflation that I commented on in my prepared remarks.

Great. That's really helpful. And then just following up on the SG&A, how much is that? What are the drivers there?

Is that higher incentive comp just because you're beating internal plans or is that, you know, opportunistic investment? you just talk about there's anything to have to do with with like that expansion at neocon just trying to get an understanding of what's what's changing there yeah so maybe i could start with sgna performance in the quarter and in mineral fiber as i you know stated in my prepared remarks that the increase in sgna was driven by investments to support growth of both the selling side of the house as well as innovation and as you mentioned an increase in incentive comp and i guess about half of that SG&A increase was driven by our recent acquisitions, while the remainder was driven by investments back into the business and resources on the selling side to support growth as we scale. On a full-year basis, Rafe, we expect leverage on the SG&A line and SG&A and SG&A margins about 20%, which is in line with our initial expectations at the beginning of the year for the company in total. And as a reminder, we want to be in that sub-20% range at the total company level, but recognize that acquisitions could initially pressure that as we continue to integrate them and deliver against the business cases there. But we're going to continue to be mindful of our rate and pace of SG&A for the remainder of the year, just given the overall, you know, context of the broader macro.

And, Rafe, I'll add to that. Just as I think about the SG&A investments, I think of them as squarely tailored to the growth initiatives that we're talking about. So, you should think about commercial selling support resources in support of the energy savings initiative, data center sales, and some R&D to support both of those initiatives as well.

Thank you. That's very helpful. Thank you.

Your next question comes from the line of Brian Byros with Thompson Research Group. Your line is open. Please go ahead.

Hey, good morning. Thank you for taking my questions today.

Good morning.

You talked about the strength of the higher end of your portfolio. I think you had prepared Mark's NSM of the call questions earlier. I think that's a theme you kind of touched on last quarter as well. I think you mentioned kind of the number of projects across the industry was down a little bit, but the value was up, and that that's a trend that plays well for your product set. Do you view that dynamic as short-term, maybe another quarter or two, or is that trend kind of more like a multi-year trend that you can continue to benefit from? How are you thinking about that?

Yeah, well, that trend – thanks for the question, Brian. That trend certainly continued in the quarter. I didn't mention it in my remarks, but last quarter we talked about 12 consecutive quarters of that dynamic where the high end of our mineral fiber portfolio is outperforming the lower end. This past quarter was the 13th consecutive. So this has been running for a couple of years now, and we expect it to continue. It's too early to project how far out, but I think it's part of the dynamic about the bidding activity that you mentioned and the starts activity that you mentioned, I think it's consistent with that. We continue to see, and we saw it again this quarter, the count of projects being down. But the value, and this is true across all our verticals for that matter, the value of the project is up. And we think it's consistent with the trend towards quality, the flight to quality, if you will, in commercial spaces, looking to distinguish those spaces. We also think it plays really well to the portfolio breadth theme that we were talking about earlier today, but definitely to the high end of the mineral fiber product category.

Got it. And then, Paul, I guess you talked about data center products you offer. You mentioned a structural grid and containment. Can you just talk a little bit more about the sales process for those products today for you? And I guess remind us, do those get specced in? Do you work with the GC or maybe directly with the hyperscaler? I guess there's more details on the go-to-market for those would be appreciated. Thank you.

You got it. Thank you. Very appropriate question given it's a dynamic and different go-to-market motion than traditional, let's say, construction, building construction spaces, because you've got different influencers and you listed them. You know, the hyperscalers as owners will set their own specifications. They'll use architects, they'll use GCs, of course, but they will have an outsized or overweight influence on the design of the spaces. Similar dynamic with co-locators, all versus traditional enterprise data center sponsors, which might look more like our traditional architect-led, spec-led motion. So some of the SG&A that we're talking about in support of data centers is specifically designed to give us a more diverse approach in our go-to-market so we can go direct to those owners. We can go direct to those co-locators and hyperscalers and give them a tailored, packaged, reliable, and consistent solution, almost bundled solution, if you will, for the range of products that we're now offering. So it is different, and we are leveraging a very strong national accounts program that we've had at the company for a really long time to leverage the relationships we have with many of those companies who are sponsors of these data centers. So that's our approach, and it's sort of a broad-based approach and requires it, given how data centers are designed.

Your next question comes from the line of Stephen Kim with Evercore ISI. Your line is open. Please go ahead.

Yeah, thanks very much, guys. Appreciate all the color so far. I wanted to lean in on the new products a little bit. In particular, I'm curious as to whether or not the success and the focus on the various new product initiatives that you have is increasing your indexing to new construction versus R&R, how you sort of think about that on a go-forward basis. And then last time I asked you about the lifespan of some of these newer products, And I just want to double click on that a little bit, you know, as I just from a layman's perspective, as I think about gasketed products, you know, where, you know, I think of gaskets maybe, you know, drying out over time or an impeding performance, or I think of face change materials, you know, the certain number of thermal cycles, you know, that they're, they're, they're designed around. I mean, I just wanted to sort of follow up on whether or not you think that there is a reason to believe that the replacement cycle for some of these products should be shorter than maybe some of your more generic historical products.

Thanks for the question. First, on the indexing, we don't feel that way. We don't believe we're over-indexing to either new or R&R. I think what we're doing, honestly, is continuing to innovate as we've done for decades. This just happens to be the next chapter of innovation around the ceiling platform. There have been step changes in fire and seismic and acoustical performance and structural performance, and we're adding a new dimension to this, and we think it plays in both new and renovation applications both, just like it has. We've had that experience for decades in serving both of those demand sources, so I think it's consistent with that. We've not framed any change in lifespan or duration, durability, or even warranty, for that matter. We continue to warrant these products consistently with how we've warranted them in the past. So we're certainly not signaling, and we're certainly not expecting the quality or deterioration to be any different. It's a question we get, frankly, around some of our new innovations, but we're standing behind those products. for the life of the products, just like it, just like the products that we had before. And we think that's important because that standard of quality, we are not compromising in our products and with our new innovation.

Okay, gotcha. Perfect. Okay, second question relates to WAVE. You know, obviously, we're looking for some strengthening results there. I was wondering if you could provide a little bit more color as to the strength that you're seeing there? Should we be thinking about this as momentum building that is likely to carry over for beyond just this year? Or is there any lumpiness that we're benefiting from here? Maybe just give us a little bit of insight into what's driving the anticipated growth in WAVE.

Yeah. But WAVE's still on track for our outlook mid-circle digits of equity earnings growth. They're pleased with their performance. We think it correlates well with our mineral fiber performance overall. And at the same time, they're continuing to innovate themselves and are bringing new products to the market along the way. So we're pleased with their performance, and we expect it to continue into the second half. Chris, you want to add some color to it?

Yeah, I was going to say, Stephen, on this steel cost front, the markets continue to face some inflationary headwinds there in the quarter. We saw the impact of higher steel flowing through the P&L, which pressured margins ahead of our announced August pricing actions, along with the ramp-up of some of the data center initiatives there that Mark mentioned. So, turning to the back half of the year, we expect a step up in the equity earnings contribution to the mineral fiber segment as those price-cost benefits offset the rising steel cost exposure there.

Yeah, that makes sense. Perfect. Thanks very much, guys. Thank you. Thank you.

Your next question comes from the line of John Lovallo with UBS. Your line is open. Please go ahead.

Good morning, guys. Thanks for taking my questions as well. The first one is, you know, within mineral fiber, the home center channel was strong again this quarter. I think it was up 9% year over year, pretty similar to the first quarter. The question is, how much of this was driven by stronger discretionary or flow business like we saw in the first quarter? And if so, I mean, what was the impact on mineral fiber volume and AUV in the quarter?

Yeah, I'll start, Chris, and you can comment. I think our flow business in the quarter, we talked a little bit about this in Q1 and in Q2, fairly consistent. It's the part of the market we don't have as great a visibility to. So we do kind of triangulate that based on home centers, maybe a little bit on what we see in canopy, and also we gather from sort of on-the-ground activity. So that flow, TI, smaller R&R work, continued to be consistent in the quarter, and I think that bodes well. It's a nice, stable source of volume for us in the quarter and certainly something that we're hoping continues in the near term. It reflects some confidence and a willingness to use that discretionary spend and support our volume.

Yeah, and really, John, nothing to call out there in terms of atypical activity. You know, that channel can be lumpy, and we saw a little bit of lumpiness here in the second quarter.

Gotcha. And then, you know, considering the $800 million step up in the share buyback authorization, And I think there's $2.5 billion authorized through December of 2029. Just curious if you guys would consider a large share repo, maybe even an ASR. Is that something that's on your radar?

So let me put the repurchase program into some context here. First of all, this is the time of year. We just had our board meeting last week. It is our annual strategic planning cycle. so we had a robust and rigorous planning cycle and a great review and discussion and approval by our board of a strategic plan. That came first. And then on the heels of that strategic plan approval, the board supported this authorization, which is an authorization. And the way we think about it is it's confidence in that strategic plan, it's confidence in our strategic direction, its confidence in the cash flow generation. It comes from that plan. But we're not signaling any change in our capital allocation priorities, as Chris talked about in his remarks. We will be opportunistic as we've been. We were opportunistic in the second quarter, as you saw, and over the life of the program, we'll continue to be opportunistic. That said, it's our third capital allocation priority, and no change there. And we continue to believe we've got a compelling pipeline of both investing back into the business at an attractive ROIC, as we've done, and also a healthy M&A pipeline to run at. So it's a balanced approach to capital deployment that's served us well for years, and this should not signal any change in approach there.

Okay. Thank you, guys.

Your next question comes from the line of Phil Ng with Jeffries. Your line is open. Please go ahead.

Hey, guys. Congrats on a strong quarter. Chris, I guess for a housekeeping question first, can you give us an update on how you're thinking about inflation for your major buckets?

If I heard you correctly, you're not expecting IEPA refunds in the back half, but anything to call out as it relates to some of the changes in news around Section 301 and 338? yeah yeah thanks phil yeah and you're correct nothing um you know expected here on the ieba front for uh the back ieba refund front for the back half of the year um you know my prepared remarks i mentioned uh in the quarter higher input cost inflation in the areas of freight and raw materials and mineral fiber let me just again frame up input costs as a percentage of cogs in the mineral fiber segment. So just as a reminder, freight's about 10 percent of COGS energy is about 10 percent and raw material is about 35 percent. And what we experienced in the quarter was higher than expected freight inflation due to pressure on carrier rates. And that's largely driven by some of the labor shortages and some industry consolidation there. Raw material inflation came in a little better than we expected, but it wasn't a real needle mover in the quarter. but we saw strong AUV in the quarter and strong like-for-like pricing, which really contributed to that healthy EBITDA fall-through rate. On a full-year basis, you know, on the input side front, we just break down the pieces. We expect energy inflation to be in that low single-digit range for the year. We're outlooking freight inflation to be in that mid-teens range for the full year. And again, that's driven by the dynamics that I just mentioned on the carrier aid side and in tight capacity there. And we expect ROS to be in that low single-digit percentage range. So all up, all in, input costs are expected to be inflationary in that mid-single-digit range for the full year. Okay.

Chris, was there any big movement from what you gave us last quarter? I go back to my notes, but I wasn't sure if there was any big moving pieces there what you thought last quarter yeah not on the total yeah so good good question thanks uh on the total input line uh in total no but the pieces did shift and most notably on the on the freight on the freight front front okay helpful um a question for you mark um obviously a lot of momentum uh in your two growth factors whether it's transportation on the data center side certainly your broader product offering investments you're making is having a real impact here but I was curious if I had a unbundle transportation versus data center piece are you winning on some of the product differentiation which has always been the hallmark for you guys on transportation and data centers I just wasn't sure if the offering was very different like you have in your rest of portfolio particularly on the data center side yeah so are we winning on transportation for differentiation, no question.

Are we scaling on data centers as we raise awareness of the fact that Armstrong can be a player, a meaningful player, and a value-add player on the data center side? That's ramping now, and that's what a lot of our commercial investments are about, is raising awareness. I think Armstrong's been recognized as a traditional ceiling player in those spaces for a long time. We've talked about serving those spaces, but now we're driving awareness to say we've got a much broader portfolio and we can serve the structure and we can serve the containment and the broader solution set. And we do think we have differentiation in those products and that's what this awareness driving is all about. Is your competitive landscape different too on the data?

Sorry, Chris. Yeah, I was just going to add a little more color on the freight piece before your follow-up, which is really that the change there is a little more pressure on the back half of the year as I outlook that range for full year. Okay. Super.

And just to your question, where you're going, yeah, the data center competitive set, it is different. It is different because in that back of house and that compute side of the data center, there is such a diversity of applications and needs and structural solution sets that is much broader and different. And you can solve your data center performance needs with structures and solutions on the floor and the ceiling in a variety of different ways. So it is a broader, more fragmented competitive set.

Okay. That's really helpful, guys. We really appreciate it. Thank you.

There are no further questions at this time. I will now turn the call back to Mark Hershey for closing remarks.

Thanks, everybody, for joining the call today and for the questions. We appreciate it. We're pleased with a solid quarter. It's a good opportunity for me to thank our teams for that performance. As we reflect on the quarter, we're really proud of outperforming the market in a dynamic environment. We've seen inflationary pressures, as we talked about today. There's still uncertainty and not a lot of market stimulant and tailwind behind us, but really good execution. And that's what we'll stay focused on to continue to create value. So thank you for your time today, and we'll talk to you soon.

And this will conclude our call today. Thank you all for joining. You may now disconnect. You