Greetings, and welcome to the Lux Experience second quarter of Fiscal Year 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. Today's call is being recorded, and we have allocated one hour for prepared remarks and Q&A. It is now my pleasure to introduce your host, Martin Beer, the Chief Financial Officer of Lux Experience. Thank you, sir. Please begin.

Thank you, Operator, and welcome everyone to the Lux Experience Investor Conference call for the second quarter of fiscal year 2026. With me today is our CEO, Michael Klieger. Before we begin, we'd like to remind you that our discussions today will include forward-looking statements, any comments we make about expectations, our forward-looking statements, and our subjects to risks and uncertainties, including the risks and uncertainties described in our annual report. Many factors could cause actual results to differ materially. We are on no duty to update forward-looking statements. In addition, we will refer to certain financial measures not reported in accordance with IRFs on this call. You can find reconciliations of these non-IRFs financial measures in our earnings press release, which is available on our Investor Relations website at investors.luxexperience.com. I will now turn the call over to Michael.

Thank you, Martin. Also from my side, a very warm welcome to all of you, and thank you for joining our call. We will comment today on the results and performance of the second quarter of fiscal year 2026 of Lux Experience. We are extremely pleased with the results of the second quarter. The initiated turnaround of XYNAPT already shows good results with strong improvements across all three business segments. Growth and profitability at group level in the second quarter of this fiscal year confirm that we are fully on track with our transformation plan, targeting medium-term group net sales of €4 billion with an adjusted EBTA margin of 7% to 9%. The MyTeresa business continues to outpace the industry, delivering double-digit growth and high profitability. Mr. Porter and Mr. Porter already show sequential improvements as a direct result of the execution of the new strategic focus on customer, full-price selling, and cost discipline. At Jukes, our strategy of focusing on the healthy core of the business, where the new management is also generating clear improvements in the results. We continue to see seismic shifts in our sector, as more and more of our competitors are not able to deliver profitable growth. Lux Experience is now the clear digital multi-brand leader for luxury enthusiasts on a global level over the past decade my theresa has consistently built and grown trusted relationships with its brand partners and customers these relationships are the foundation of our success sustainable and profitable growth in luxury comes from providing brands and customers with the very best in service and experience. As a group, we know how to engage with true luxury customers through desirability, emotion, and community. These principles remain at the core of everything we do. Together with Netta Porter, Mr. Porter, and Jules, we will see the tremendous opportunities that present to us going forward. As Lux Experience, we possess the secret sauce in digital luxury. Let me now start by commenting on the MyTeresa business. We are again extremely pleased with the outstanding results in the second quarter of this year, 2026. MyTeresa's clear focus on wardrobe building, big spending, luxury customers and their needs through inspiration by curation, highest quality service, and community building, which physical events has again strongly paid off. In Q2 of fiscal year 2026, we grew our net sales by plus 8.8% compared to Q2 of fiscal year 2025. In the United States, which is a key market for growth, net sales reached plus 22.9% in Q2 fiscal year 26 compared to Q2 fiscal year 25. In the second quarter, the U.S. accounted for 23.3% of net sales of our total business. In Europe, excluding Germany and the U.K., we saw a net sales growth of plus 7.3% in Q2 fiscal year 26. MyTeresa's financial strengths and exceptional growth are fundamentally driven by its outstanding customer base. In the second quarter of fiscal year 2026, the top customer base of MyTeresa grew by plus 13.5% compared to the prior year period. Furthermore, the average spend per top customer in terms of GMV grew by a very strong plus 12.5% in Q2 fiscal year 26 versus Q2 fiscal year 25. The average order value last 12 months for MyTeresa increased by a remarkable plus 12% to an outstanding 824 euros in Q2 fiscal year 26, demonstrating the success of our focus on selling full-price high-end luxury products to top customers. The continued full price focus at MyTeresa is also evident with the again improved gross profit margin growing by 140 basis points in Q2 fiscal year 26. Lastly, MyTeresa's customer satisfaction, which we measure by our internal net promoter score, NPS, hit a high note reaching 83.7% in Q2 fiscal year 26, up from 78.3% in Q1 fiscal year 26, showcasing the continued excellence in customer service despite high volumes during the holiday period. Our success with big-spending wardrobe-building customers makes MyTereza a highly desired partner for luxury brands. In the second quarter of this year 26, we saw again many high-impact campaigns and exclusive product launches underlining MyTereza's strong relationships with luxury brands. We launched exclusive collections like the Dolce & Gabbana Holiday Collection for women's wear and kids' wear, only available at MyTheresa, as well as exclusive holiday capsule collections for women's wear from Christian Louboutin, Roger Vivier, and Etro, only available at MyTheresa. We were the exclusive pre-launch partner for the Studio Nicholson and Aaron Levine's collection for men's wear. We also launched exclusive styles from Loeves and Bottega Venetas pre-spring 26 collections and exclusive runway looks from Montclair Grenoble's fall winter 25 collections for women's wear and men's wear. Please see our investor presentation for more details on these capsules and exclusives. In addition to creating desirability for our top customers with exclusive digital campaigns and product launches, we also create desirability and a sense of community for MyTeresa's top customers through unique money-can-buy physical experiences. In the second quarter, we invited top customers to a special curated experience with Bottega Veneta at Teatro La Finice in Venice that included the reopening of the historic theater enjoying Mozart's La Clemenza di Tito, as well as an intimate gala dinner within the theater itself. We hosted an exclusive private gathering in Riyadh, unveiling MyTheresa's latest curated luxury collections, including exclusive skiwear styles. We also hosted style suites in Warsaw, Frankfurt, Zurich, Hong Kong, New York, and Los Angeles, presenting new collections in immersive, curated environments. A highlight in the United States was the style suite in partnership with Schiaparelli for two days in Miami to present the top, the drop two collection. Together with Roger Vivier, we welcomed our guests in the newly opened Maison Vivier in Paris, offering a special guided archive tour, followed by an intimate dinner hosted by creative director Gerardo Felloni. We also partnered with Tom Ford to host our guests at Claridge's in London for an exclusive dinner honoring the creative director, Heide Ackermann. Noteworthy was also our two-day mountain experience with Moncler Grenoble in Gstaad, featuring an afternoon tea aboard the iconic La Belle Epoque train, an intimate dinner and snow activities with lunch on the Egli Mountain the following day. in united states we also hosted an intimate dinner with dolce and gabbana at casa cipriani to celebrate the exclusive holiday capsule in attendance of domenico dolce in the spirit of being a community for luxury enthusiasts my theresa has intensified its outreach to high-end luxury customers with three immersive shopping experiences in asia the United States, and Europe. In Jilin City, we invited guests for Mai Teresa's first ever winter experience in China, combining alpine sport, apres ski culture, and a Mai Teresa apres ski pop-up bar. In New York, Mai Teresa partnered with Honey's Bakery for an immersive holiday gift shop experience on Madison Avenue, inviting guests to step into a world where the nostalgia of festive suites met the sophistication of high fashion. Finally, in St. Moritz, Switzerland, Maitereza opened an immersive hotel-inspired space offering guests a captivating experience for four months. Envisioned as a private club, the setting brings Maitereza's world to life through trunk shows, presentations, and workshops. Please see our investor presentation for more details on these unique money can't buy experiences in summary we are extremely pleased that my tereza for the third quarter in a row delivered above market growth and martin will later show how the outstanding top line results translated into very strong bottom line results let me now comment on the luxury segment comprised of netta porter and mr porter In the second quarter of Fiscal Year 26, we saw continued improvements as a direct result of the execution of the new strategic focus on the luxury customer seeking editorial inspiration and brand discovery, as well as a strict focus on full price selling. This clear focus on customer and, of course, cost discipline already starts to bear fruits. In Q2 fiscal year 26, net sales declined by 1% versus Q2 fiscal year 25, demonstrating a clear improvement compared to the net sales decline in Q1 fiscal year 26 of minus 10.8% for Netta Porter and Mr. Porter combined. Europe, excluding Germany, increased by plus 14.4% in terms of net sales in Q2 fiscal year 26 compared to the prior period. The overall small net sales decline is still driven by too little investments into attractive new merchandise a year ago by the previous leadership, as well as still needed improvements in the global shipping network and stock allocation. But we can already see improved results for the new, upcoming spring-summer 26 season. Beyond the overall net sales stabilization for Netaporter and Mr. Porter combined, the average spend in terms of GMV per EIP, the so-called extremely important people, grew by plus 3.6% in Q250 year 26 versus Q250 year 25. The average order value last 12 months increased by an outstanding plus 13.6% to 861 euros for Net-A-Porter and Mr. Porter combined. The customer satisfaction at Net-A-Porter measured by our internal NPS reached 65.3% in Q250 year 26, increasing by plus 1200 basis points compared to q2 fiscal year 25 all these kpis point to a significantly improved health and quality of the business of netapporter and mr porter in the second quarter of fiscal year 26 netapporter started to show high impact digital campaigns and exclusive product launches that underlined the fashion authority and positioning of both brands. Net-A-Porter partnered with Manolo Blanick for an exclusive capsule inspired by and to coincide with the Marie Antoinette Style Exhibition at the V&A Museum in London. Guests were invited to a private view of the exhibition after hours hosted by Christina Blanick herself. To coincide with the global release of the Netflix documentary, Net-A-Porter launched an exclusive capsule with Victoria Becker. Net-A-Porter also launched an exclusive party capsule with fashion brand Rabanne, amplified with a star-studded event at the Scotch London, Le Club Le Rabanne for the night, as well as a portacover featuring Rabanne's designer, Julien Dossena, and Victoria Faola. This fashion moment launched the party season and made it on to the cover of WWD. Net-a-Porter also unveiled an exclusive capsule with the row of seasonal items only available at Net-a-Porter. Also, two private seasonal digital pop-up shops were featured with Jura, Jessica McCormack, and the House of Scapparelli, confirming Netapote as the destination for fashion discovery and unparalleled access for its customers. Editorial excellence continued with Serena Williams as the Samba cover star of Porter magazine, marking one of the most viewed covers of 2025. Netapote also relaunched its same-day delivery service in London and New York, promising customers to shop today and wear it tonight. The relaunch, including new training and uniforms, is a core element of Net-A-Porter's improved service commitment and was celebrated with a multi-channel holiday and gifting campaign. Also, Mr. Porter started to show high-impact digital campaigns and exclusive product launches. Mr. Porter launched Michael Ryder's debut collection for Celine as their exclusive online wholesale partner. The Solomeo Exhibition, an exclusive 40-piece capsule collection with Brunello Cuccinelli, also launched on Mr. Porter. Further exclusive product launches included Gallery Department, the Elder Statesman, and Montclair. Mr. Porter also created a number of unique experiences for its EIPs, including an intimate dinner to bring together New York's core menswear industry at New Hotspot Wild Cherry, driving an earned reach of 6 million views across Instagram from invited guests. Brand director Jerry Langney and the actor Billy Piper hosted a joint party upstairs at the Langans, London. The event was strategically timed to create buzz during the busiest holiday season, and female-focused talent drove awareness as female customers account for 34% of Mr. Porter's customers during gifting season. The dedicated event, Carousel on Mr. Porter's Instagram, was the fourth most viewed post of all time, with over 1.5 million views and 74% new follower engagement. As part of the editorial focus of Mr. Porter, brand new video franchises were launched, including Ways to Wear, Behind the Brand, and three gifting video complaints. Mr. Porter also launched its winter campaigns, including Weekend Away, The Great Outdoors, and Party Wear. Mr. Porter's journal feature on musician and writer Josh Hunt drove 20,000 visits in its first week, whilst the video drove 1.6 million views on Instagram, making it the second most read talent story and viewed Instagram posts in 2025. Please see our investor presentation for more details on Net-A-Porter and Mr. Porter's unique editorial content and campaigns. To sum it up, the second quarter has seen further sequential improvements at metaporte and mr porter demonstrating that we are making very good progress in the turnaround of both businesses under the new leadership team martin will later provide more details on the progress achieved in bringing the metaporte and mr porter luxury segment back to profitability in the near future lastly let me comment on uke's performance in the second quarter of his year 26. We are pleased with the progress of the ongoing separation of the Ux business from the luxury segment. The Ux management has made very good progress to focus on its healthy core and operational fulfillment models that are profitable, creating a lean business model specifically tailored to the lower margin and lower AOV nature of the off-price business of use. In Q2 fiscal year 26, net sales declined by minus 7.3% versus Q2 fiscal year 25 through use, a clear improvement compared to the net sales decline in Q1 fiscal year 26 with minus 16.6%. In Europe, including Germany, a clear geographic focus going forward, net sales already increased by plus 13.9 percent compared to Q2 this year 25. The overall net sales decline is mainly driven by a renewed focus on a healthy core for the Ux business and the deprioritization of overseas markets with high cost to serve. While the overall net sales declined for Ux, the top spending customer average spend in terms of GMV grew by plus 4.1% in Q2 fiscal year 26 versus Q2 fiscal year 25. The average order value last 12 months continued to increase by a remarkable plus 11.4% to 255 euros in Q2 fiscal year 26. Duke's customer satisfaction measured by our internal nps reached 50.2 percent in q2 fiscal year 26 significantly up from 34.5 percent in q1 fiscal year 26 and compared to 29.9 percent in q2 fiscal year 25 showcasing significant improvements of customer service operations at the all the above kpis clearly indicate good first results of the focus on the healthy core of the Yuke's business. In the second quarter of this year, 2026, Yuke started to also deliver on its brand promise, empowering customers not only to own the pieces they desire, but to unlock valuable community moments. For the first time in many years, Yuke's created an intimate holiday fashion dinner at Milan's iconic Milofar Depot in line with its holiday campaign theme. The event was designed to connect leading fashion media and key opinion leaders through culture and design embedded in the Jukes brand vision. Jukes also kicked off a community building event in Berlin through a fashion meets art event hosted at the surprising Nader Gallery location. The event brought together fashion insiders, artists, and cultural tastemakers from diverse backgrounds, united by a shared passion to art and style. By blending fashion with contemporary art, Jukes created a space for meaningful connections, creative exchange, and authentic brand engagement, reinforcing Jukes' role as a cultural connector both events boosted engagement through community building delightful experience and increased the guests emotional bond with you please see our investor presentation for more details on these events to sum up the focus on a healthy core for use shows first clear results and the much improved quality and health of the business. And now, after having reviewed the good commercial results and strong improvements across all our businesses, I hand over to Martin to discuss the financial results in detail. Thank you, Michael.

As Michael mentioned, we're very pleased with our strong results in Q2 of our fiscal year 26, running from October to December 25. Just eight months after the acquisition of YNAB, we already report top-line growth on group level, with net sales growing plus 1.1% reported, and plus 5.7% on a constant currency basis. In addition, we are already turning profitable on group level, with an adjusted EBITDA margin of plus 2%. all three segments improve the performance versus the prior quarter on top and bottom line our cost initiatives are effective with decreasing sgna cost ratios and we were able to report strong operational cash flow of plus 118.5 million in the quarter all these underlines the success of our transformation plan and is fully in line with our expectations. And as a reminder, we are targeting $4 billion in sales at an adjusted EBITDA margin of 7% to 9% medium term. As planned, we expect to close the sale of the outnet in the current quarter, and our off-price business is now fully focused on the ux turnaround. The sale of the outnet will not have any effect on our segment and group reporting, as it has already been classified as discontinued operations. So let me first review LuxExperience performance at group level. I will then walk you through the performance of our three segments, Luxury Maitreza, Luxury Net-A-Porter and Mr. Potter, and the off-price business of Ux in more detail, and give an update on guidance. Unless otherwise stated, all numbers refer to euro. For Q2, Fiscal Year 26, and for the first time since the acquisition of wine three quarters ago, we are already reporting top-line growth on group level. On group level, net sales grew plus 1.1% reported and plus 5.7% on a constant currency basis. On GMV, plus 0.2% reported in the quarter and plus 4.7% growth on a constant currency basis. This is a clear acceleration relative to Q4 with minus 5.3% year-over-year and Q1 with minus 4.3% year-over-year GMV decline. In the first six months of Fiscal Year 26, Lux Experience had a GMV of $1,274 million and net sales of $1,202 million. Our SG&A transformation initiatives are clearly visible at group level. Compared to the preceding Q1 of fiscal year 26, the SG&E cost ratio decreased 270 basis points from 21.8% to now 19.1% in Q2 fiscal year 26. For the first time since the acquisition of YNAB, we achieved a positive adjusted EBITDA on group level with an adjusted EBITDA margin at plus 2%. Both the top and bottom line show clear signs of progress in our ongoing transformation and are fully in line with our expectations. Operating cash flow of the Lux Experience Group was a positive 118.5 million, driven by the underlying seasonality in our business. For the first half of fiscal year 26, operating cash burn was only at minus 30 million. in q3 of fiscal 26 we expect that the cash effects of our layoff program will be visible this will come in addition to the senality of our business we therefore expect a negative operating cash flow in q3 for the full fiscal 26 we expect operating cash burn to stay well below 150 million given fiscal 26 as a key transition year for our transformation plan as a reminder we're executing our transformation plan on a fully funded basis with total cash outflow during all years of the transformation plan to range between 350 and 450 million we expect to break even on an operating cash level in two years. The group ended Q2 of fiscal year 26 with cash and cash financial investments of in total $543.6 million. Together with our non-utilized revolving credit facilities, our total available funds are at $724.2 million. We are in an ideal situation to operate the fully funded transformation and our growing business model completely debt-free. Given the seasonality in our business, Q2 is typically a strong quarter. The performance in Q2 underlines the success of our transformation plan fully in line with our expectations. We confirm our medium-term targets of $4 billion in net sales and an interested EBITDA margin of 7% to 9%. let's now review the performance of our my treaser business during the second quarter of fiscal year 26 gmv grew by plus 9.9 percent to 268.9 million compared to the prior year period on a constant currency basis gmv grew by plus 12.7 percent year over year net sales grew to 242.7 million in the quarter representing a plus 8.8 percent increase on a constant currency basis with net sales growth is at plus 11.6 percent we continue to significantly take share in an overall soft market in q2 my trees has gross margin increased by 140 basis points to 52.3 percent as compared to 50.9% in the prior year period. We were able to again significantly increase the gross profit margin while growing top-line double-digit. Main driver was our continuous effort to increase the full price share. Given the new U.S. tariff situation in Q2 of the fiscal year, the shipping and payment cost ratio was up 150 basis points compared to Q2 of Fiscal Year 25, but at similar levels compared to the previous quarter. As we pay all duties for our U.S. customers, the cost increase for us is reflected in our shipping and payment cost ratio. If you excluded the duties costs, the shipping and payment cost ratio decreased by 90 basis points from 8.5 percent to 7.6 percent compared to Q2 of fiscal 25. Main drivers of this improved cost ratio were higher AOVs and lower negotiated shipping fees based on higher group volumes. Same as in the previous quarters, the overall increase in the shipping payment cost ratio in the pnl is offset by an increase in our gross profit margin in q2 of fiscal year 26 the marketing cost ratio decreased by 70 basis points from 12.3 percent in q2 fiscal 25 to 11.6 percent we are successfully capturing market share but are mindful of the overall soft market situation. As targeted, we will increase marketing spend throughout the remaining fiscal year if deemed effective. Our executed cost savings measures are visible in the selling general and administrative SG&A cost ratio, decreasing by 220 basis points to 11.7 percent compared to the prior year quarter. SG&A expenses on absolute numbers decreased by minus 7.7 percent compared to the previous year quarter, and the cost ratio further benefited from the strong top-line increase. Subsequently, the adjusted EBITDA margin expanded by 200 basis points during the quarter to 9.3 percent as compared to 7.3 percent in the prior year period adjusted ebitda grew by 6.4 million versus the prior year quarter to 22.6 million in q2 of fiscal year 26. just as a reminder due to the seasonality of our business our fiscal q2 is always a very strong quarter for the first six months of our fiscal year the adjusted ebitda margin significantly improved from 4.5 percent to 6.5 percent we are continuing our effective inventory management with inventory levels at my trees are down minus 2.5 percent compared to previous year despite double-digit top-line growth let me now comment on the luxury net-a-porter and mr porter segment in more detail in the second quarter of our fiscal year 26 gmb only declined by minus 1.9 percent to 290.7 million this was a strong sequential recovery compared to the minus 10.8% GMB decline year-over-year in the preceding Q1 of fiscal year 26. On a constant currency basis, GMB even increased by plus 4.9% in the quarter. Net sales were at 277.1 million, a minus 1% decline year-over-year. also at net sales level a strong sequential recovery from the minus 10.8 net sales decline in the preceding q1 on a constant currency basis net sales grew plus six percent year over year in q2 of fiscal year 26. the new leadership team is working on improving the current and upcoming seasons buying volumes and aligning the subsequent marketing strategy to re-embark on top-line growth again we expect to see continued the gmv and net sales growth in the second half of this fiscal year the gross profit margin in q2 of fiscal year 26 decreased to 46.1 due to one-time effects in the previous year excluding this effect the underlying operative gross margin was stable compared to the previous year quarter core focus of our transformation plan is to bring down the SG&A cost ratio. The SG&A cost ratio in this quarter was at 22.7% of GMV, significantly down from 27.6% in the previous quarter. It was also down compared to Q2 of previous year at 23.8% if you include capitalized IT development costs. With the communicated layoff program now being executed we will see more significant effects in q3 and q4 of this fiscal year the 22.7 sgna cost ratio in this quarter compares to the 11.7 percent at my theresa and signals the more than 1 000 basis points opportunity for us to achieve significant cost savings we will continue to bring down this difference with adjusting the operating model the IT replatforming, corporate overhead cost savings, and re-embarking on top-line growth. Warehouse closures are executed, and the delivery models are being adjusted. Studio and customer care operations have already been consolidated. The unified data platform is fully protected, and the overall IT replatforming is being executed according to plan and without a single delay. The layoff programs in all jurisdictions are now fully concluded with effects visible in Q3 and Q4 of fiscal year 26. In sum, our comprehensive turnaround plan until fiscal year 28 is being executed diligently and fully in line with our expectations. The NAP, Mr. P, segment already almost broke even in the quarter with an adjusted EBITDA margin at minus 0.7 percent therefore also on bottom line a significant sequential improvement from the minus 6.9 percent adjusted EBITDA margin in the preceding Q1 of fiscal year 26. this improvement clearly highlights the impact of our actions so far to strengthen profitability at the same time our quarterly performance is subject to the typical seasonality of our business with q2 and q4 generally stronger and q1 and q3 generally weaker with the full execution of our transformation plan and bringing down the sgna cost ratio we expect the map mr p segment to achieve comparable profitability levels to the my treaser segment medium term with a targeted adjusted EBITDA margin of plus seven to nine percent medium trend. Inventory levels at NAP Mr. P are down minus 3.8 percent to previous year and we will continue to enable top line growth at NAP Mr. P with adequate working capital and improvements in the global shipping network and stock allocation. Let me now review the financial performance of off-price business of ux in line with our transformation plan at ux we are focusing on the healthy core of the business de-prioritizing overseas markets with high cost reserve discontinuing the unprofitable marketplace model and implementing a lean operating model supported by a simplified off-price tech environment also at ux a significant improvement in top-line performance Continuing the path of a more comprehensive restructuring effort at Ux and with focus on profitable customer cohorts, GMB declined minus 12.1% in Q2 year-over-year to 125.3 million compared to minus 19.3% in Q1 year-over-year. On a constant currency basis, GMB only declined minus 9.4% in the quarter. net sales were also at 125.3 million a minus 7.5 percent decline year over year also at net sales level strong sequential recovery from the minus 16.6 percent net sales decline in the preceding q1 on a constant currency basis net sales declined only by minus 4.6 percent in q2 year over year. This significant sequential improvement clearly indicates good first results of the focus on the healthy core of the Ux business and on European markets and also includes the effect of discontinuing the unprofitable marketplace model. With the focus of Ux on the European customer and despite increasing U.S. duty rates, the shipping and payment cost ratio stayed mostly stable only increasing 30 basis points from 14.5 percent in q2 of fiscal year 25 to 14.8 percent in q2 fiscal year 26. as michael mentioned the operational focus of ux is on a fulfillment model that is profitable creating a lean business model specifically tailored to the lower gross margin and lower aov nature of the off-price business of Ux. The core focus of our turnaround plan is to bring down the SG&A cost ratio also at Ux. The SG&A cost ratio in this quarter was at 26.9% of GMB, down from 29% in the previous quarter. On an absolute level, SG&A expenses in Q2 of fiscal year 26 decreased by 4.6 million or minus 12.1 percent compared to previous year Q2 if you included all the IT development costs and this was achieved despite the stranded costs from the separation of the outlet with the communicated layoff program now being executed we will also see more significant effects in Q3 and Q4 of this fiscal year we are significantly consolidating warehouse, studio, and customer care operations. The tech legacy cleanup and simplification is going well and with full speed. Corporate costs are driven down and aligned to a lean business model. And with a focus on healthy European targeted growth, the SG&A cost ratio will continue to decrease to the targeted levels. During the second quarter of fiscal year 26, the adjusted EBITDA margin improved significantly from minus 18.1% in Q1 of fiscal year 26 to now minus 6% in Q2 of fiscal year 26. With the execution of our defined transformation measures, we expect to return to adjusted EBITDA profitability of Ux in 12 to 15 months and return to top-line growth already in fiscal year 27. Inventory levels at Ux are minus 8% to previous year. Given our H1 of fiscal year 26 performance fully in line with our expectations and with more visibility in the ongoing full fiscal year, However, we would like to provide an update on guidance for our full fiscal year expectations. With the implementation of our transformation plan executed in line with our targets, we narrow the ranges of our existing guidance for the full fiscal year 26. For the full fiscal year 26, we now expect GMB and net sales between 2.5 billion to 2.7 billion, previously $2.4 billion to $2.7 billion, and an adjusted EBITDA margin of minus 1 to plus 1%, previously minus 2 to plus 1%. With the underlying seasonality in our business, we expect Q3, softer than Q4, with Mitresa growing high single digit in H2 and full fiscal year 26. For the luxury business of Knapp and Mr. P, we expect positive growth rates towards the end of the fiscal year and therefore expect in sum a low single-digit GMB decline for the full fiscal year 26. For the off-price business of Ux, we expect top line to further moderate through H2 of fiscal year 26 with overall low teens top line decline our medium term targets remain unchanged with our 4 billion net sales target at an adjusted ebitda profitability of plus seven to nine percent and to return to 10 to 15 percent annual growth rates we will continue our track record of diligently executing our plans and delivering what we target. And with this, I'll hand over to Michael for his concluding remarks.

Thank you, Martin. We are extremely pleased with our second quota of fiscal year 2026 earnings results. BAC's experience has delivered strong results and improvements across all three segments and is fully on track with its transformation plan targets, confirmed by the strong second quarter. The turnaround at XYNAB has clearly started while MyTeresa continues to deliver remarkable above-market results. The continued outstanding performance of MyTeresa demonstrates our proven ability to drive profitable growth in digital luxury. The secret sauce is now applied to our new businesses. Overall, Lux Experience is perfectly positioned to benefit from the sustained growth of digital luxury and the ongoing consolidation within the sector, allowing us to capitalize on significant market opportunities. We are fully committed to being a reliable partner operationally, strategically, and financially for all our partners. We will continue to generate significant value for our customers, brand partners, and shareholders. And with that, I ask the operator to open the line for your questions.

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, simply press star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, press star one again. Please stand by while we compile the Q&A roster. Your first question comes from the line of Oliver Chen with TD Cowan. Your line is open. Please go ahead.

Hi, thank you, Michael and Martin. Really nice results all around. On the revenue side, they were better. Which regions or divisions were better than you expected? And how would you contrast how Europe looks relative to the nice momentum you're seeing in America's? Also on the 140 basis points at my Teresa, are you expecting full price selling to continue to fuel gross margin expansion going forward there? And what should we know about the base case for what's included in guidance for shipping as well? and would love your take on the main drivers of raising the low end of guidance as well. And finally, on the SG&A cost ratios, you made a lot of progress there. What's been easier versus harder in terms of lower-hanging fruit versus longer-term as you manage that? How are you balancing the SG&A strategy relative to continuing to offer great customer-facing service? Thank you.

Thank you, Oliver. A whole battery of questions. So let me try to cover them and then hand over to Martin for some of the guidance and margin questions. So region, as explained, Ux focuses on Europe, sees good traction, 14% growth. So Europe is really a good market for the off-price market sector. Netapote, MyTeresa, we of course have good opportunities in the US. MyTeresa has seized them. 25% growth in the US for MyTeresa in the second quarter in constant currency, even over 30%. So we see strengths in the US and we believe it will continue and we see good strengths in in europe asia is a mixed story but i also always want to stress the arabic peninsula as as good opportunities for growth in terms of uh free price selling um we have seen now many quarters of increased gross margin thanks to increasing the share of free price we still believe also looking at historic uh numbers that we can continue to increase the full price share uh one until we get back to sort of the normal that we have seen in in in before covet so there is still room to to improve and we expect to continue to improve and on the on the sgna i mean obviously there are some structural changes that will take time particularly technology but on operations consolidating warehouses consolidating customer care centers consolidating photo studios we have actually progressed enormously quickly and have already closed warehouses pulled all photo studios in so we're making good progress but I can assure you we have taken more actions than what is visible in the bottom line still, because some of them have time lag. So we are well on track. The whole transformation, the whole turnaround will take until end of 27, but well on track. And that's why we confirmed today our medium-term target of 7% to 9%. And maybe for some of the guidance and shipping questions, Martin?

Yeah, I'm happy to answer. So, I mean, the overall profitability in H2 is expected to be around the same level at Maitreza as we saw on H1, so the 6.5%. In the previous year, H2, we had 5.2%. So, it's exactly as you call out. You always have to compare Q1 and Q2, the weaker quarter and the strong quarter, the same logic on Q3 and Q4. On the shipping and payment cost ratio, the duties are all included and we see a stable trend in Q1 and Q2. So this will continue and therefore the improved profitability of the Mitresa segment to an expected overall around 6.5% adjusted EBITDA margin is driven by the increase in the cost profit exactly what michael said on um continuously i'm continuing to to increase the the full price share and therefore seeing improvements um in in the cost profit margin okay and on the revenue

side which one beat uh relative to expectations or what should we know about how revenue trended

relative to your guidance this quarter and the the overall revenue guidance is is also triggered i mean by all three segments. So we will, we saw in H1 at Mitresa, you know, a plus 11.6% GMV growth. And so we guide towards a, you know, high single digit top line revenue guidance for Mitresa in the second half, and therefore a high single digit for the full fiscal year. But we see a very strong, continuous trend at Mitresa. So this is really a huge strength at Mitresa. Now, Mr. P, and Michael called it out, is driven by now, you know, improved buying volumes and aligning marketing and improving the stock allocation. And therefore, we expect in the later part of H2, also top line growth at Net-A-Porter and Mr. Porter and therefore expect, you know, for the full fiscal year, a low single decline. But the sequential improvement that we see on top line really shows and now will continue at Mr. P. And at Ux, it takes a bit longer with the focus on the healthy core of the customer, with a focus on Europe and moving out of the unprofitable marketplace model. Therefore, we see low teens decline in net sales for the second half and for the overall fiscal year. So the top line development also mirrors the transformation plan and is fully aligned with the expectations.

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

Thanks and congrats on a nice quarter. Thanks, Matt. So, Michael, with the seismic shifts that you cited in the luxury sector, could you speak to how your portfolio is positioned today? Maybe offensive initiatives that you've put into place to capitalize on market share globally and new customer acquisition?

I mean, obviously, with its fine-tuned machine, Michael Reza is best positioned to take advantage of these opportunities. And as we highlighted in the investor presentation, it's now the second quarter where we grew over 20% in the U.S., currency over 30%. So we are taking market share in the United States. We win customers. We increase our share of wallet with existing customers. But MetaPorter and Mr.Porter are absolutely well positioned as well. They have actually even stronger brand awareness and brand appreciation in the U.S. They are not as finely tuned yet. There's still work to be done. But with Wales operations out of Jersey, being able to deliver same day in greater Manhattan, there's real opportunity also for Nettapote and Mr. Porter. And as we come with fall winter, with a new season buy completely done by our new teams, we will see real good performance by Netta Porte and Mr. Porter in the U.S. in Q3, Q4. And it's all about presenting the best selection, presenting the best curation, having the product that customers are looking for. And at a global level, we are positioned as the one partner for brands, for free price selling, for a differentiated tone of voice. That's how we see ourselves, and that's what we strive to be.

Great. And then Martin, as a follow-up.

Your next question comes from the line of Grace Smalley with Morgan Stanley.

Sorry, was Matt cut off?

Sorry, I didn't hear anything from Matt.

Yeah, he had a follow-up question. Maybe you can bring it back and we first do Morgan Stanley.

My apologies. Please stand by. Your next question comes from the line of Grace Smalley with Morgan Stanley. Your line is open. Please go ahead.

Hi, everyone. Hopefully we can go back to Matt afterwards. I just I was going to ask a question more broadly on the luxury industry, given your insights across all brands. Clearly, we had this period of significant growth for luxury, followed by more of a digestion period over the last couple of years, which is sort of, if you look at the backdrop now, where do you think we are in terms of the general luxury cycle? What are you seeing both in terms of the aspirational consumer versus the high net worth, and also in terms of creative cycles and the product newness would be interested to hear your thoughts?

Thank you, Grace. We believe we look at a very solid calendar year 26. As you can see in our numbers, there's double-digit growth. It's true. Some of the big names had to go through some transition phase, switching creative directors. But at the same time, as you're very familiar, we have seen fantastic numbers by the likes of Brunello Cuccinelli, by the likes of Thoreau, by the likes of Europeana. And as we saw real investment into new creativity in the last fashion season in September with a lot of new creative directors, we believe luxury has gone through a transition phase and maybe, as you said, a digestion phase. But we believe there is upside for luxury as a whole in the coming months. I think, as always, there will be some brands and some players that will take more advantage of it than others. It's still in the quality, in the desirability. But we have seen good collections in September, and they're starting to be delivered now in Feb. We already pre-launched new Gucci. We will have launches from Balenciaga, from Saint Laurent, from Versace. so a lot of new impetus so we believe it will be a good year of course all depending on on the

stability in the macro environment thank you for the color and then just to follow up on that are you seeing any changes in terms of the brand's pricing architecture or the different price points that your consumers are gravitating to i mean we clearly are in a phase where there's

very little price increases. We've gone through a phase of massive price increases also driven by scarcity in raw materials. There's a bit of a pause there so that I always say it's an equation between price and desirability and as prices keep standing and hopefully desirability increase then we will see that result and then And there is movement still early on the contemporary aspirational side. It will be interesting to see in the coming four weeks whether we see also progress. The progress so far we have seen are really in the big houses, I must say.

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

Great, great. So Martin, for follow-up, I guess, could you elaborate on the progression of EBITDA margins in the fiscal 27? What I wanted to know is relative to this year's flat base at the midpoint, what's the best way to model the timeline for the transformation actions that you're taking across the portfolio as it relates to the bottom line?

Yeah. So you're referring to already fiscal 27. Obviously, we will give guidance then uh in in in in the midst in the summer in the last quarter we always give further for the follow-on um fiscal year but clear i mean you see the sequential improvement uh it is again always nicely laid out by the three segments it's driven by the three segments which are completely um i mean different than the current state and then all um will uh you know align towards the the the medium-term target of four billion in net sales and seven to nine percent adjusted EBITDA margin so um the we will see a sequential improvement in in the second half um of um of fiscal year 26 um obviously driven by you know continued improvement uh in of of my trees uh um metaporte mr porter um regaining uh profitability uh and uh the ongoing restructuring efforts at use and obviously this will then turn into fiscal year 27 where we obviously you know target along our five-year plan improvements and this will obviously do not be a linear function towards our medium term targets of seven to nine percent in fiscal year 29 30 but we will give an update Well, I'll give an update on the fiscal year 27 expectations in our next quarterly report here.

Maybe just one follow-up. When you cite medium term, is there any quantification, like how long is medium in your view?

It's fiscal year 29 and fiscal year 30 is our medium term.

Okay, great. Helpful color. Thank you.

your next question comes from the line of anna glaskin with b riley securities your line is open

please go ahead good morning and thanks for taking my question um i guess i'd like to start near term given the disruption at you know a luxury department store in the u.s to what extent does guidance embed or do you expect some disruption as there could be some promotions coming from a competitor?

Thanks. I mean, it's hard to predict how the department store sector in the U.S. will unfold. As you know, there is Chapter 11 proceedings. I fundamentally believe that what the last years have shown is that the only way to have a sustainable, profitable business model is to focus on full price selling. So promotions are very short term and I hope that with whatever comes out of the proceeding a new entity that will follow that principle because otherwise there's no sustainable profitable business. We have proven that and we had moments in our history where other competitors tried to find short-term gains we always stick to our policies and it has paid off and so honestly regardless of what will happen in the u.s department store sector after chapter 11 we feel there is market share gains to be to be have in in the u.s market because also a lot of this has started to be confusing and disappointing to customers. And what you see is what you get at MyTeresa, at Metaporta, Mr. Porter, it's inspiration, it's great service, it's curation, and that's what we focus on, and we see we can win with this.

Got it. Thanks. And then shifting to the YNAB businesses, it seems like there's been some nice progress made with some year-over-year inventory reductions. Can you speak to the overall health of the inventory and how much work is left to be done.

Do you want to speak to inventories?

Yes, happy to speak to inventories. I called out the healthy inventory levels at Mitresa with a good aging structure and, you know, stable, a bit declining despite double-digit growth. So that continues to be in great shape. um that about mr porter um is more you know uh working with the legacy of having bought too little and therefore we are increasing we're investing uh in inventory to enable the growth uh in addition to all the other measures of the transfer population plan so uh inventory level is down at NetMister P and driven by past time decisions. At Ux, also inventory is down. So the logic of the inventory, I mean, or the current state of the inventory, it's fully aligned with expectations. It's good, it's healthy, but we need to grow the inventory. We need to invest in working capital as this is also targeted in our transformation plan. So, from the inventory side, the new teams, new leadership is heavily working on, you know, on fall, winter, 26, and now spring, summer, 27.

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

Hi, guys. Thanks for taking my question. So, I wanted to double-click on luxury YNAB. That was strong in the quarter. I believe it was 6% growth, excluding currency, which was a bit better and earlier than you'd expected. Can you unpack what drove the growth there in terms of new customers or the new merchandise you spoke to and then AOV versus units? And then what are you expecting for that

business in the second half in terms of growth? I mean, the growth mirrors very much the pattern that we have seen at MyTeresa. It starts from the top. So it sits with the big spenders. It's really, of course, it's driven by really focusing on that customer. It is driven by AOV increase. We have called out that we have seen double-digit AOV increases, most of the supporter and the supporter. There is two-thirds is ARV, so more expensive items, which is not higher prices. It's actually sort of picking items higher at the ladder. And also one third is more units. And that's where the growth is coming from. And then what I always stress, we are massively reducing promotions. We have cut back on discounts. And that also helps, of course, on full price selling is not only good for margin, full price selling is also good for the top line. And so this focus on the top spender and this continuous detox, so to speak, from discounting and promotion, we will continue. This will be part of the strategy going forward, of course. And then with Q3, Q4 particularly, where the fall-winter season comes into play, where we have bought more, where the new team has really driven the curation, we expect even better traction on the fall-winter collections.

Great. Thank you. And then I wanted to ask, my follow-up would be on the operating cash flow target to your timeline. Martin, anything you would call out specifically there in terms of drivers that could get you there potentially earlier? And then any color on the shape of the improvement over the two years?

yeah i'm like i mean the uh i i really called out in the uh in the call that you always have to um combine q1 and q2 and q3 and q4 given the seasonality of the business so for the first half giving our strong operational cash flow in q2 we have a cash burn of minus 30 million And for the full fiscal year, I expect overall cash burn to be well below $150 million, given fiscal year 26 is our key transition year. So that, you know, implies that, you know, the payout of the severance packages and other transformational payouts will be in this H2, in this coming H2, so Q3 and Q4, leading to an overall cash burn of below $150 million for the full fiscal year. and this is the key transition here but i mean the transformation plan is a two to three year two to three year program um and uh we uh we clearly guided on the overall cash burn for the whole plan for all years um and so we we expect then the the cash burn to uh be still significant next year, but then will decrease. And I also called out that we expect to be, you know, cash break even from operational cash in two years. So it is fiscal year 26. The second half fiscal year 26 is a is a key cash cash outflow and fiscal year 27 will keep will continue to be to be negative but we are really happy with the flow um fully in line with our expectations and uh and and so cash will not be um the the limiting factor for our transformation plan for returning to profitability and for re-engaging on top-line growth. And I think it is really worthwhile to repeat that we work on a fully funded transformation plan and we work on a completely debt-free environment. So I have a very strong balance sheet on top to the additional cash for the transformation plan and the buffer.

There are no further questions at this time. This concludes today's call. Thank you for attending. You may now disconnect.