Good afternoon, everyone, and thank you for joining us. With me on the call today are Joe Vernachio, CEO; and Annie Mitchell, CFO. During this call, we will be making comments of a forward-looking nature. Actual results may differ materially from those expressed or implied as a result of various risks and uncertainties. For more information about these risks, please review the company's SEC filings, including the section titled Risk Factors in our report on Form 10-Q for the quarter ending March 31, 2025, for a more detailed description of the risk factors that may affect our results. These forward-looking statements are based on information as of August 7, 2025. And except as required by law, we assume no obligation to publicly update or revise our forward-looking statements. Additionally, we will be discussing certain non-GAAP financial measures. These non-GAAP financial measures are in addition to and not a substitute for measures of financial performance prepared in accordance with GAAP. A reconciliation of our non-GAAP measures to the most directly comparable GAAP measures can be found to the extent reasonably available in today's earnings release. Now, I would like to turn the call over to Joe to begin the formal remarks. Joe?

Good afternoon, everyone. Thanks for joining us today. We're pleased to conclude the first half of the year well positioned for what's ahead. Our operating and financial results reflect strong execution among our teams and continued progress on our path to reignite the Allbirds brand. In the second quarter, we delivered top line results at the high end of our expectations and adjusted EBITDA exceeded our guidance range. The pace of change and the progress we've made over the past several quarters is significant and has set the stage for growth. Over the past year, we've been focusing on strengthening the foundation of our business, making it leaner, more efficient and better positioned for long-term success. And most recently, we took actions to enhance our financial position. With that groundwork firmly in place, we've reignited the engine that powers our future — product, marketing, and the customer experience. What's now coming to life is a carefully sequenced strategy to reintroduce Allbirds, starting from our roots and building toward a clear reimagined future as a modern lifestyle footwear brand. Beginning this month and continuing through the end of the year, we plan to drop new products every month and introduce new marketing content every week. We are confident in what the future holds as we turn the page on a new era of growth. The current macro environment creates some uncertainty around consumer spending, but it does not change our conviction in the work we have done and the compelling product, marketing, and customer experience we're bringing to the market. The reintroduction of our brand, our products, and our new sensibility began in earnest in July. We started with the Tree Runner NZ, an improved version of our best-selling style, familiar but better. Alongside it, the Cruiser, brand new and also crafted from our signature eucalyptus-derived tree material, shoes for people on the move, traveling in the hot weather, chasing summer daylight. Just this week, we returned to our roots, retelling our origin story through the Wool Runner NZ. As one of our most beloved styles, it continues to be the purest expression of who we are. This relaunch gave the silhouette a fresh perspective, putting Marina wool, breathable, luxurious, and naturally derived back in the spotlight. With it, we honored both the design and the material that first put Allbirds on the map a decade ago. Next, we plan to introduce the new Wool Cruiser in more than 15 colorways. This bold expression of color will come to life through a special collaboration, reinforcing a quality customers have always loved about us — vibrant, joyful color. As we head into autumn, we expect to launch our first-ever waterproof collection, perfectly timed for cold mornings, wet commutes, and slushy sidewalks. Then in November, we have plans to debut the Kiwi collection — a slipper, a clog, and a low boot, footwear designed for life at home and quick trips out to the mailbox, the market, or a neighbor's doorstep. Cozy, step-in comfort and intentionally casual. These styles are made for how people really live during the holidays — not dressed up, but warm, easy, and inviting. This season, we're introducing a broader range of new styles and materials than ever before, bringing depth, discovery, and innovation across the line. We're expanding into new textures and finishes like Velveit, tweed, and sculpted knit patterns with new drops expected to arrive every few weeks. In total, we expect to launch 19 new styles this season, a major step forward from a year ago. Perhaps the most interesting of these is Remix. We're once again highlighting our commitment to making better things in a better way with the launch of Remix, a step forward in circularity. In partnership with Blumaka, a leader in foam upcycling and Circ, a pioneer in textile to textile recycling, we're giving manufacturing waste a second life. On the new Runner and Cruiser platform, we will turn foam scraps, textile waste, polycotton blends, material destined for landfill into beautiful, comfortable shoes. We've often said that to win in this market, you need a relentless flow of compelling product, and we're delivering on that. Our new product launches are now wrapped in a wave of fresh marketing content. Breaking through today's crowded landscape requires both volume and variety, and we're responding by dramatically scaling our output. Where we once created 5 to 10 assets per month, we're now producing over 100. This marks a meaningful shift in our marketing approach aimed at significantly expanding our reach and impact. These additional assets will significantly fuel our paid media strategy. Beyond paid media, we're activating the brand through high-impact PR and experiential efforts. For example, we recently placed ads in TSA security trays across all terminals at Seattle Airport, a strong market for us. We're also hosting PR events and store activations in New York and San Francisco, supported by tactics like wild postings around our store locations. Together, these immersive and intentional efforts are designed to reengage our existing consumers and invite new ones into the brand. On the customer experience front, we went live with a fully redesigned website in mid-July. The site features modern navigation, richer product detail pages, and an updated aesthetic that reflects our brand evolution. We're thrilled with the design and functionality and anticipate this will drive improved dwell times and higher conversion rates. For our in-store shoppers, we're refreshing our fleet. With relatively modest updates to layout, fixtures, navigation, and merchandising, we've significantly improved the in-person experience, enhancing the way people shop and engage with the brand. After completing refreshes at 3 locations, San Francisco, New York City, and the Stanford Shopping Center, we are seeing measurable increases in the average daily sales performance. This gives us confidence in our strategy, and we plan to continue refreshing additional locations with more coming in the next few months. Looking further ahead into the first half of 2026, our commitment to our 3 focus areas remains just as strong. On the product innovation front, 2 key launches help illustrate what's next. First, we plan to debut a new material that we have branded Terralux. It's an innovative material designed to provide leather-like aesthetics and performance. It looks, feels, and performs like leather, made using plant proteins, biopolymers, and recycled materials that would otherwise be put in landfill. Terralux will anchor a curated capsule called the elevated collection, designed to meet rising consumer demand for comfort and more refined style forward moments. We believe this category represents a significant growth opportunity, and anticipate bringing it to market in early 2026. Also planned to launch next year is our Aerie material, a new upper mesh fabric derived from our popular tree fiber and engineered for lightweight breathability and all-day cooling during the hottest months of the year. It's another example of how we're using material innovation to meet consumer demand. These are just 2 of many innovations in the pipeline, each one advancing our mission to lead in comfort, style, and sustainability. In late May, we held our spring 2026 sales meeting, where we previewed what's coming for our external partners. Over the course of 2 days, we hosted our distributors from around the world as well as our new sales agents representing the U.S. marketplace. The assortment was very well received, and it was validating to receive such positive feedback from our trusted partners who have a keen sense of the market. With the product momentum we're building, we believe we're now better positioned to advance our wholesale channel strategy. With the broadest assortment Allbirds has ever had, we're beginning to sell into footwear specialty accounts for spring 2026. We're taking a very deliberate and measured approach to the channel, one that grows over the seasons to come. Entering the second half of the year, taking into account the global macro environment, we're assuming a more conservative view of the top line. However, what's unchanged is our expectation that the convergence of our initiatives will drive sales growth in the fourth quarter. We've been talking about this moment for many quarters, and now it's here. Live in the marketplace today is the first wave of our new product, marketing, and customer experience. We invite you to explore the new site, try the new shoes, and experience the storytelling. We're proud of this reintroduction of Allbirds and confident that it marks the beginning of a new chapter that will drive growth, building a strong foundation for sustained profitability and create long-term shareholder value. Before turning the call to Annie, I'd like to thank our teams who have remained laser-focused on our plans. We would not have reached this important juncture without their hard work and strong desire to win.

Thanks, Joe, and good afternoon, everyone. We continue to deliver strong execution in Q2 with top line results that were in line with our guidance and adjusted EBITDA that exceeded our expectations. Our teams continue to demonstrate financial rigor, prioritizing cost discipline, careful inventory management, and cash conservation. Looking at the P&L, net revenue for the quarter totaled $40 million, at the high end of our guidance range. Q2 gross margin came in at 40.7% compared to 50.5% a year ago. This is roughly in line with our anticipated cadence for the year and reflects a particularly tough comparison to last year. The year-over-year decline is attributable to the following: planned promotional activity, inventory adjustments associated with the transition of the European market, a shift in channel mix from our distributor transitions and store closures, and increased per unit freight and duty costs. While the tariff landscape continues to evolve, we remain confident in our ability to deliver full year gross margins in the mid-40s. We are prepared to mitigate the 20% Vietnam tariff that takes effect this month. There are a couple of key factors enabling us to offset tariff impacts this year. In the second half, we will have a higher mix of new products that have been designed and developed at lower costs. Additionally, beginning in Q4, we expect to go to market with modestly higher prices on select new products. For context, we plan to do this on a scale that still conveys value to the consumer and allows us to stay within our planned pricing architecture. Turning now to Q2 expenses. We brought down SG&A by 28% versus prior year. The improvement primarily reflects lower payroll and occupancy costs, driven by our distributor transitions and fewer retail stores. During Q2, we took advantage of opportunities to exit an additional 4 retail doors. That brings us to 9 store closures year-to-date and a current U.S. store count of 21. We also announced 2 new distributor agreements in the quarter, furthering our expansion into new international regions. These new deals cover multiple countries across Central and South America and Southern Europe. Subsequent to quarter end, we announced 3 additional agreements for multiple countries throughout Eurasia. Many of these new distributors are ramping up their Allbirds business starting in the second half of this year. Looking at marketing expense. The second quarter came in at $9 million or 21% of revenue. That's down from last year when we were investing behind the launch of our Tree Runner Go. In Q2, we started investing in middle funnel and performance marketing initiatives in anticipation of our fall product introductions, which, as Joe noted, are just beginning to hit the market. On a full year basis, we anticipate marketing expense on both a dollar basis and as a percentage of sales will increase compared to 2024. From a bottom-line perspective, Q2 adjusted EBITDA loss improved to $13 million. This exceeded the high end of our guidance range by over $3 million, reflecting our commitment to cost control and driving a healthy, efficient cost structure that will support long-term profitable growth. Moving to the balance sheet. We ended the quarter with $33 million of cash and cash equivalents and inventories down 21% versus a year ago. We narrowed our operating cash use to $9 million in Q2. That's down on a sequential basis, reflecting the seasonal cadence of working capital as well as the upper funnel marketing investments we made in Q1. As planned, we will be ramping up our marketing investments going into the second half of the year to support our new products. This increased spend as well as normal working capital fluctuations will result in higher operating cash use in the third quarter relative to Q2. Looking at the capital structure, we are pleased to have completed a comprehensive financing package, including a new revolving credit facility. This added flexibility will help support our growth plan. Turning to guidance. As noted in today's press release, we are adjusting our full year revenue outlook and reiterating our adjusted EBITDA guidance. Let me provide some context, starting with the top line. We're updating our full year outlook for net revenue to a range of $165 million to $180 million, which includes approximately $20 million to $25 million of impact associated with our distributor transitions and store closures. This is $2 million higher than our previous estimate and reflects the incremental door closures in Q2. Stripping out the impact of those structural changes, net revenue is expected to grow approximately 3% at the midpoint of our updated guidance range. We're also introducing third quarter net revenue guidance of $33 million to $38 million. Our revised full year outlook primarily reflects the uncertain macro environment as well as our decision to close additional stores in Q2. We're pleased with the way our initiatives are coming together, giving us confidence in our Q4 outlook, which includes an implied top line growth rate of 17% at the midpoint. Despite the revision to our sales outlook, we are reiterating our full year adjusted EBITDA guidance as we continue to manage the business with financial rigor and discipline. Our full year adjusted EBITDA guidance range remains at negative $65 million to $55 million and includes an expected third quarter adjusted EBITDA loss in the range of $20 million to $16 million. Approaching the balance of the year, our key initiatives are in flight, and we feel good about our positioning from both an operational and financial perspective. We look forward to keeping you updated on our progress as we continue to focus on building toward long-term profitable growth and shareholder value. We appreciate your time this afternoon, and we'll now ask the operator to open the call to questions.

Two quick ones for me. First of all, I mean, you touched on this at the end of the opening remarks. But can you give us a bit more color on how the store closure and transition to distributor model process impacting top line and overall profitability compared to your initial expectations?

Yes. Overall, when we went into this year and we're planning the impact from door closures and international transitions, we estimated the impact to be $18 million to $23 million. With the decision to close additional doors in Q2, we're increasing that range by $2 million to now be $20 million to $25 million. As a reminder, the reason why we are pursuing the distributor model for international regions is although it impacts the top line, it is immediately profitable on the bottom line and additionally has working capital benefits to us. We transitioned to the EU at the end of Q2, which is our last international transition. So we look forward to having more comparable comps year-over-year as we go forward. Retail doors, we've also targeted largely unprofitable doors for these closures. And so, while we did close additional doors in Q2 compared to what we were planning to for the year, these were opportunistic that came up for us, and we decided to pursue them again with the interest of increasing the bottom line. So, while this does impact our top line, it serves an effort of the bottom line improvements for year-over-year.

Yes, this makes perfect sense, because looking at the income statement, that benefit at the profitability level in cash terms is actually evident. That's very insightful. And then the second question real quick, if I may, on inventory. You're entering the second half of the year with a much leaner position, which is great. How should we think about your inventory strategy for the remainder of the year, particularly in light of the planned new product launches?

Great. Yes, we have done exceptional inventory management over the past 2 years. We ended the quarter down 21% year-over-year. And with this last transition of the international market, the EU, again, as we did at the end of Q2, many of those year-over-year comparisons should now be evening out with all those transitions complete. You should expect to see strong inventory management from us. And we've bought appropriately even with all of these new products. And so you should not expect to see a meaningful increase or actually an increase at all in terms of inventory because of the strong overall inventory management. To add a little bit of color, in addition to the traditional open-to-buy management that we've implemented over the past 2 years, we've also made operational changes, something as simple as ship from store. And so, as we are buying into these new products, we can put the right amount of product in store, have great assortments, especially where we start to really bring in some beautiful colors. We can make sure the stores are representing the full line the way we want them to, but still have the ability then to use that inventory to fulfill e-com orders. So, it's a combination, again, of the rigor of a strong open-to-buy as well as these operational improvements that we've been making that give us confidence that even with the volume of new product and styles that will be coming, you can expect to continue to see strong inventory management from us.

And Francesco, this is Joe. I'm glad that you asked that question about inventory because when you're refreshing your line as much as we are and adding so much depth and color and differentiation, it's critical that we keep our arms around the inventory, because it is our inventory management that allows us to stay full price and to bring in full-price customers and to make this into a growing high-margin brand that we are building towards. So, thank you for that question. Inventory is something we discuss literally every day here.

Maybe just, Annie, a quick follow-up on that question. So just to be clear on the sales guidance reduction, it sounds like your expectations on the core of the business haven't changed. It's just that you have this incremental store closure and distributor dynamic happening. Is that right?

Yes. And there are 2 key factors behind the change in top line guidance. Structural, as you just mentioned, with the retail door closures and macro. And the additional door closures that were not initially planned are worth about $2 million incremental. And the rest is really associated with the overall macro economy and being — it's really increasingly uncertain over the past few months. So, we believe it's prudent to assume a more conservative view of the top line. That being said, what we know is that consumers, while they are becoming more choiceful and seeking value, we also know that our customers respond to our brand when we show up with newness and a strong value proposition. And the new product that we're bringing, the comfort, quality, and style, we're really excited about what this is going to mean for the consumer and help us to build towards growth. So, we introduced 3 new styles in July. We just introduced another one this week, and we'll have a few more this month, and this will continue to build over the course of Q3 and Q4. And so, we're building up between now and the end of the year. Additionally, as we look towards the back half of the year, some of those structural impacts do start to lessen in terms of their sequential impact on each of our quarters. But ultimately, at the end of the day, we're confident that the convergence of our initiatives will help us to drive year-over-year sales growth in Q4.

Perfect. And maybe just for Joe, just on the transformation plan, bigger picture, where are you like furthest along relative to where you thought you'd be when this first all started? And then maybe on the other side, what's maybe been a little bit more of a pain point than you thought? Just a big picture view on the plan.

Yes. Thanks for that question, Alex. I'm just so delighted and pleased with where we are in this process. We have moved at light speed to affect all of the different aspects. But most importantly, we've been building towards this — literally this specific moment right now, where all of the product efforts in design and product development and fit and materialization and on the marketing side, we started at the beginning of the year just waking our customer up with that cards on the table initiative and then now bringing in a lot more lower funnel, very functional and performance-driven marketing to really wake our customer back up again and get them to remind them of who we are and what we deliver to them. And it's coming in earnest. We repeat this number all the time. And we have 19 new products coming into the marketplace over the next handful of months. We've only put 2 or 3 in the market, depends on how — literally just a day ago, we put another one in the market. And already, we're seeing the consumer really gravitate to it. So as an example, in our retail stores, of our top 15 styles, style colors, 12 of them are the new products and new colors that we're delivering. So, they're just starving for new products, and we're going to feed that in the back half of this year. And we expect that to really start to accumulate and this build will start in Q3 and should really start to accelerate in Q4. So, we're exactly where we wanted to be at this point. We're actually slightly ahead. We relaunched the website about 3 weeks earlier than we had planned to, and it's given our consumers a really great experience. The store refreshes have gone really well. All the product is delivering on time. I'd like to come up with something as to what I think we're falling behind on, but I'm really pleased with where we are. We're actually slightly ahead of everything that we had on plan. Thank you, everybody. Appreciate you joining, and enjoy the rest of your summer.

That concludes today's conference. You may now disconnect.