Thank you, Todd.

Our performance in the second quarter continues to demonstrate the durability of our business model in current market conditions. Our teams are executing with precision, and the results demonstrate the strength of our strategy and the resiliency of our operating model. For the third quarter, we expect discretionary remodel activity and new residential construction to remain under some pressure. In roofing, we are planning for seasonal storm demand to be in line with historical averages, but expect to see the impact of heavier Q2 inventory stocking, reducing distributive purchases in the quarter. Non-residential construction across North America is projected to remain stable, and in Europe, we continue to see signs of a gradual recovery in our core markets. From an enterprise perspective, we expect third quarter revenue in the range of $2.6 to $2.7 billion, slightly below the same period last year. Our adjusted EBITDA margin is anticipated to be approximately 20 to 22%. Now, consistent with prior calls, I'll provide a more detailed business-specific outlook for the third quarter. Starting with our roofing business, we anticipate revenue to be down mid to high single digits compared with the prior year. Even with a more normalized storm season, we expect ARMA shipments to be down high single digits in the third quarter as market volume is pulled forward into Q2 ahead of announced price increases. We anticipate our volumes to be broadly in line with the market. While we are seeing solid realization of our Q2 pricing actions in the third quarter, ongoing input and transportation inflation is expected to result in negative price costs. Overall, we expect roofing to deliver an EBITDA margin of approximately 30%. Moving on to our insulation business, we anticipate mid-single-digit revenue growth compared to prior year. North American residential revenue is expected to be relatively flat to last year, with slightly higher volumes offset by the impact of previously targeted pricing actions. Given our decision to start up our new Kansas City line focused on non-residential products, combined with upcoming furnace rebuilds planned over the next two years, we plan to restart our Nephi Utah plant in the fourth quarter. As a reminder, this is one of our smaller, more flexible production lines that can be used to service the residential market primarily on the West Coast. For North America non-residential, we expect revenue to be up low double digits on the strength of higher volume and pricing execution. And in Europe, we anticipate revenue to be up versus prior year, driven by strong volume, pricing execution, and a continued recovery in our core markets. Overall, for the business, we expect slightly positive pricing to be more than offset with ongoing costs and transportation inflation, resulting in negative price costs in the quarter. Given all that, we expect Q3 EBITDA margin for insulation to be in line with Q2, which was 22%. Turning to our DOORS business, we expect revenue to be down mid-single digits compared to last year, primarily due to the divestitures Todd mentioned earlier. We expect to continue seeing the positive impacts of our cost optimization initiatives and enhanced go-to-market strategies. Pricing in the quarter is expected to be slightly positive, and we've implemented a price increase that will take effect near the end of the third quarter. But given ongoing material costs and transportation inflation, we expect negative price costs in the quarter. Overall, for Doors, we expect a third-quarter EBITDA margin of approximately 10%, in line with prior year. With that review of the business outlook, I want to close out with a few enterprise comments. Despite current market conditions, we remain focused on delivering on our strategy and leveraging the OC advantages to help our customers win and grow. We are positioning the company as a best-in-class performer with multiple levers for revenue growth, earnings expansion, and cash flow generation. Additionally, we are well-positioned to benefit from several key secular trends, such as energy efficiency and an aging housing stock that provides significant opportunities for long-term growth. Finally, I want to recognize the hard work and commitment of our teams across the company. Their focus on safety, innovation, and operational excellence to service our customers continues to set us apart and puts us in the best position to achieve strong results, regardless of market conditions. With that, we would like to open the call up for questions.

We will now begin the question and answer session. Please limit yourself to one question. 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 Stephen Kim with Evercore ISI. Your line is now open. Please go ahead.

Yeah, thanks very much, guys. Appreciate all the color. A lot we could talk about. But let's start with insulation. The degree of the volume strength surprised us. I think you indicated that non-res in the U.S. and Europe kind of drove some of the strength. But North American res, it was also up slightly. So if we just sort of unpack that, your volume, I think, was up, you know, kind of high single digits. Can you give us a sense for, you know, a little bit more granularity as to where that strength in the top line came from? And then also you talked about opening up Nephi, and I think you were reopening Nephi. I think you mentioned that was going to be kind of like to offset some rebuild activity. So I was wondering if you could give me a little more color, like just when is the rebuild going to happen? and how quickly is Nephi going to be open, and what is your longer-term intention with respect to keeping Nephi open? Thanks.

Well, good morning, Stephen. Thank you for the questions. Let me start with the volume strength piece, and then we can talk about how Nephi fits into the picture. When we look over a longer period of time, I mean, really it's been a, you know, almost a decade-long strategy now within our insulation business to really invest heavily in the non-res in European pieces of the business to support organic volume growth. And you see that most recently with the XPS line that we started up in Arkansas. We invested in our Stonewall facility in Sweden. And then we've got a Kansas City line coming up next year, which is Brian's chair. We'll start up, focus more on the technical insulation piece of the business. So we've been very much focused on organic growth there. We're really proud of how our team's executed in the quarter. When we look at non-res in Europe, markets are decent there. In the non-res piece, we've got pockets of real strength in data centers, which we would kind of put it, you know, 5% or less of our overall revenue, but it's growing at a fast enough rate that it is helping us on the top and bottom line in insulation. But we're also seeing strength in other pockets and pretty broad-based strength in the non-res pieces in North America. Same story is true in Europe. We're seeing our core markets rebounding. We've been talking about green shoots and improvement there for a while. We're seeing that occur. But really, in both cases, we're seeing great commercial execution by our teams to serve our customers really well and just perform well in the current markets that we're in. And you can see that continue with the guide that we gave for Q3 as well. We expect those trends really to continue into the third quarter. When we look at res, we talked last quarter that we were down a bit versus the market in Q1 in res, we rebounded then to be a little better than the market in the second quarter. The guide for Q3 suggests, again, compared to liked housing starts, we'd be a little bit better than liked housing starts in Q3. But if you look at all three quarters together, we're more or less tracking the market. So we're, you know, we're happy with the commercial performance that we're seeing. I think we're benefiting somewhat from customer mix and geomix of just where some of the strength in multifamily is occurring and some of the single-family dynamics. But generally, I would look at it on more of a rolling basis through the year rather than quarter by quarter because we do know there are some quarterly items that can move around. When we look at Nephi, we are reopening Nephi. We designed Nephi to be a plant that would be relatively straightforward for us to take down and start up. It's one of our smaller lines. It is to support a couple of things. One, we've got rebuilds occurring in 27. We've got a couple of rebuilds in our system. So Nephi is an important part of making sure we can serve our customers well. As Brian shared, we intend to start up the Kansas City line, focus more on the technical insulation piece, and Nephi also fits how we want to manage the network overall. And I would just share in the short run, we don't expect much of a cost increase related to restarting Nephi. With diesel and transportation where it's at, we can serve the West Coast more cost-effectively with that asset running. So we'll start it up in Q4, and assuming everything stays the same around delivery cost, we're not going to have too much of a one-time cost impact from the startup. So that's the dynamic. Thanks, Stephen.

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

Good morning, guys. Thanks for taking my questions as well, or my question as well. You know, relative to, I guess, the long-term targets, roofing EBITDA margins have been strong. Doors have shown some nice progress. Insulation margins, though, have been under some pressure. I think they're a few hundred basis points below that long-term target of 24 and kind of sitting at the lower end of that 20% to 27% range. So can you just kind of help us with the path to get back towards, you know, closer to that 24% range over time? Thanks, John.

I appreciate the question. So when we look at the Guided Investor Day, we range that based on a housing market between 1.2 and 1.6 million housing starts. So we've been at the lower end of that range, both in terms of new starts as well as resale activity has been, you know, fairly weak since we communicated that. When you look at the major driver of why we're a little lower than the 24%, it's really the price cost dynamics. We've absorbed quite a bit of inflation in this business over the last couple of years, and even now we're absorbing some delivery inflation as well as other materials inflation in the business. It's been a couple years since we've gotten price traction on the red side. We do have a price increase out in market now. It did get pushed to September, but pricing will be a part of that story given the amount of inflation that we've absorbed. The other piece of the story though is, you know, structurally non-res in European businesses are good mix for us. And, you know, as we grow disproportionately into those spaces, we also like the mix impact that we would see on EBITDA margins over time. The final piece, I would say, is just continuing to work on productivity. We have a really good track record in that business of driving pretty consistent productivity, really end-to-end through manufacturing supply chain and network optimization. As we start up assets like our Russellville asset in XPS, as well as Kansas the city. We like those new modern assets because we tend to have lower ongoing operating costs from those locations. They also balance out our network a bit more to give us some supply chain benefits as we go forward. So, you know, there will be a price over cost element. There will be just a mix, a business mix element, and then there will be a productivity element, all of which should give us momentum to get closer to the 24% over time.

Your next question comes from the line of Trevor Allenson with Wolf Research. Your line is now open. Please go ahead.

Hi, good morning. Thank you for taking my question and congratulations to Todd on the new role. First one are questions on roofing price realization. I think you mentioned you're expecting good realization on that increase. How would you compare what you're expecting relative to historical standards? And then maybe just to put a finer point on that, If we look at your revenue guide and the volume numbers that you're talking about, on one end of the range, it could imply something close to the flatter price. Just wanted to see if you could provide any more color on what you're expecting in terms of year-over-year roofing pricing in the third quarter.

Thanks, Trevor. Yeah, I think we're seeing very good price realization across the April and June increases. So on the last call, we talked about the April announcement seems to realization. Given the inflation pressures that we're seeing around asphalt costs, other input material costs, transportation, delivery costs, we announced the June increase and put that into the market. Combined, I think we continue to see good realization, I'd say in line with historic averages that we've seen in the past. So we feel like that momentum is building. So pricing was pretty flat in Q2, but we continue to see that price realization come through in our numbers. and we expect that to build in Q3 and then in Q4 in terms of helping us to recover some of that cost inflation. So we feel we're set up well there and we continue to think we're going to see that realization increase in terms of a year-over-year impact on pricing as we go through Q3 and then in Q4.

Your next question comes from the line of Rafe Jadrosic with Bank of America. Your line is now open, please go ahead.

Hi, good morning. Thanks for taking my question. I just wanted to give you a chance to, if you have any response to sort of the Carlisle headlines that are out there, and maybe, Brian, can you talk about how you think about the valuation today versus, like, the long-term opportunity?

Yeah, I'm not going to comment on speculation raised in an article driven by anonymous sources. You know, we believe our strategy is delivering great value for our customers when I think about our investments in innovation and pull through and the demand and helping our customers win and grow in the market, we think our strategy is delivering great value for our shareholders, which I talked about in my prepared comments. When we look at the cash generation of the company and improvements we've made over time, we've returned now close to $5 billion to shareholders over the last, since 2019, we've more than tripled the dividend. So we believe our strategy is generating great financial results that we continue to improve. It's increased the durability of our margins, our cash flows, and that we've been very disciplined capital allocators to invest in our business. Sometimes that's going to be heavily weighted towards share buybacks, given some of the valuation we see in the market today. It's going to be investments in organic growth that we continue to strengthen our market positions. And then we want to be dedicated to returning capital to shareholders, which we've committed and have had a committed strategy to return at least 50% over time. We've exceeded that over the last several years, given the strong cash generation and the financial improvements we've made within the company. So we believe our strategy is generating great results. We like our position. I talk quite a lot about the journey we've been on to reposition and refocus the company as a branded, large-scale, residentially focused building product company with three very complementary market-leading businesses that we are driving more integration through and really bringing the OC advantages that we think is going to be able to accelerate growth and performance as we go forward. So we believe all the moves we've made continues to create a compelling investment thesis for our shareholders. We believe we continue to invest in growth and the top line for the company, and that's going to service our customers as well. And lastly, I'd say I think our Q2 performance, our first half performance is just an ongoing proof point of the strength of our company, the strength of our businesses and the execution of our team. So we feel very good about how we're operating today. We feel very good about the strategy and direction of the company.

Your next question comes from the line of Susan McLaurie with Goldman Sachs. Your line is now open. Please go ahead.

Thank you. Good morning, everyone. My question is on the roofing channel inventories. You mentioned that there was some pull forward in the quarter related to the pricing actions that came through. Can you just give us some sense of how much do you think is sitting out there? And if we do have an average storm season as we move through the late summer and into the fall, how long could it potentially take us to get some normalization back to that market?

Yeah, thanks for the question. Yeah, We did clearly see some pull forward, particularly around the June increase, that impacted volumes in that quarter and then resulted in, you know, a little better volumes overall in the market and for our business. I characterize it probably as I think about it is when we look at the pull forward, previously when we were putting our guide in, we got into a market that was going to be down kind of mid-single digits. We thought that was incorporating any kind of pre-buying around the April increase. We finished significantly higher than that. The market finished pretty flat. So I would say when you look at that pull forward without it, we probably would have been getting on this call guiding to a market in Q3 year over year that would have been pretty flat as opposed to down. So we think that difference in terms of that guide now is really the reflection of some of the inventory that was pre-built around the June increase overall in the marketplace. So I think when we look at Q2, Q3 volumes, we kind of would put those together in terms of the market itself. I think the first half market was still impacted by some weaker storm activity, as Todd mentioned in his comments. So the in-year storm activity is kind of falling in line with historical averages, still a little weaker on a year-over-year basis. We also, just as a reminder, last year in the first half had about 3 million squares of storm carryover that was being serviced. We didn't have any carryover really coming in this year. So I would say there's been some regional variances and overall market demand emerging as we go through this year, where pockets in regions like the Midwest, upper Midwest, mid-Atlantic, we're seeing very good market demand and good volumes. areas in the southwest southeast which are a little bit more storm dependent we're seeing a little weaker volume so I think overall I'd say distributor inventories are a little heavier than normal but it's very regional in terms of where that market demand is so to your question on how that kind of plays out through the year if we have a more normal you know historically normal storm season we think those volumes kind of work through q3 into q4 if we have a little a lighter year, that could impact Q4 volumes a little bit as distributors try to restock the inventory. But I'd say the second half demand is going to be much more dependent on storm demand, and it's going to be much more regionally dependent than we've probably seen the last couple of years.

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

Hey, guys. Congrats on a strong quarter. I guess a question of Proud for Todd. You guys gave some color in terms of the tariff refunds for the quarter. How should we think about it for 3Q? And there's obviously been a lot of movement on tariffs, including Section 338, and you got some dynamics with your door business there. So just give us an update on how to think about that tariff refund dynamic. And then more broadly, inflation, you gave us some color on 3Q. Should we think later in the year that moderates and does that price-cost dynamic perhaps improved going into the fourth quarter?

Thanks, Phil. Appreciate the question. So just to recap, what we shared about our Q2 results, we had about $25 million of net benefit from tariff refunds. About half of it indoors. The rest spread across the enterprise. There is, you can see in our footnotes, there's a little over $20 million that we have pending as potential refunds in the future. We don't know for sure if it's going to hit Q3, Q4. It could even be spread across both quarters. We would anticipate that it would impact this calendar year, though. It's a very different shape, though, of what we saw in Q2. It's pretty spread across the businesses, and it's really not material for any one business going forward. That has been excluded from our guide, so that was not included in any of the numbers that Brian shared on the outlook for Q3. So that could be a little bit of modest upside if we, you know, if we see that impact the quarter. You know, overall, from an ongoing tariff standpoint, it's pretty steady, excluding the impact of the refunds. We continue to see, you know, tariffs across our businesses. It's impacting doors disproportionately compared to the other businesses. And we don't really see that easing up here in the near term as we get, you know, certainly through the next couple of quarters. When we look at inflation broadly, you know, a lot hinges on what happens with Iran. So as we shared in our comments, we are giving a net inflation number now related to Iran. The reason we're doing that is some of the gross inflation is getting caught up on the balance sheet and is impacting subsequent quarters. So some of the gross inflation we saw in the second quarter is going to impact Q3. You know, if we saw a sudden stop to the Iran inflation, there is a little bit of a tail impact here of it continuing as we work through the value of that inflation and inventory in subsequent quarters. You know, overall, we don't know if Iran continues into the later part of this year. It's had an impact on asphalt costs. It's had an impact on transportation costs, and in particular, diesel fuel, which I mentioned earlier. It's also starting to come through some of the other materials that we buy, like, for example, polystyrene in our insulation business is inflated. So we're seeing some of that impact come through, but a lot of it could taper off if we saw a resolution to Iran later this year. In terms of the price cost, you know, price needs to be a part of this equation that we've got. So we're going to do everything we can on the inflation side to temper and mitigate the impacts. But we do have price increases in the market now in all three of our businesses. As Brian shared, we've seen good traction on the roofing increase. We've seen good traction on our non-res and European increases. We're starting to see some traction on the doors increases in the market. And then we've got the price surcharges to offset the increased fuel costs also in market. So we're seeing some momentum on the pricing side. That's an important part of the story, Phil.

Your next question comes from the line of Anthony Pettenari with Citi. Your line is now open. Please go ahead.

Good morning. Just following up on Phil's question on the tariff refunds, it seems like some of your peers are using a portion of their refunds for growth initiatives. Are you contemplating that, or should we just treat it as really an offset to inflation? And then maybe to broaden the question a little bit, you know, indoors, you know, where I guess the lion's share of the tariffs impact is, you know, how do you balance kind of investing in the business for future growth versus, you know, cutting and optimizing on cost?

Thanks, Anthony. Appreciate the question. So, So, yeah, I mean, when we look at the amount we've absorbed in terms of tariff impact and then Iran impact, in particular for the Doors business, it is a really substantial impact to the EBITDA margins that we delivered in Q2 and then we got it to for Q3. So our view would be that the refunds offset significant costs we've incurred across Owens Corning as a result of the tariffs that were in place. when we look at investments, I mean, we continue to invest in our business. We invest in innovation. We invest in our brand. We invest in other marketing programs. We're really focused now on how do we serve our customers well across all three of our businesses. But that's really unrelated to anything that we're seeing from a tariff refund standpoint.

Your next question comes from the line of Mike Dahl with RBC Capital Markets. Your line is now open. Please go ahead.

Thanks for taking my question. Just to circle back on roofing, can you be a little more specific in terms of, you know, you said your shingle volume outperformed the market, but then you had some offsets on the non-wovens. Can you help us understand kind of what volumes look like from a pure shingle standpoint? And then within the guide for 3Q, how much of an impact is that non-wovens contract going forward? And then the final piece would be, I think previously you expected roofing specifically get back the price cost positive in the fourth quarter by year end. And can you just clarify, given all the moving pieces, if that's still your expectation?

Yeah, thanks. Let's take them in order here. So the underlying shingle and components business in Q2 outperformed the market. I think this was a contract, a nonwoven customer, that the contract ended at the end of last year. So the volumes, kind of Q4, Q1, were a lot lighter on a year-over-year comp in Q2. was the heaviest buy, so it had a little bit more of an impact. That phases out really in next quarter Q3, so there wouldn't be any year-over-year impact there. But it was really kind of an anomaly around just a very large amount of volume purchased by this contract customer in Q2 of last year that kind of materialized through the numbers. But again, the core shingle components business saw volume growth in the quarter and are now performing the market on that piece. So, but again, this nonwoven's impact, we shouldn't have a big impact in Q3, and then that drops off on a year-over-year comp. On the price-cost piece by Q4, again, this is going to be a little bit to Todd's comments earlier around. I think it's going to be more dependent on the inflationary environment. We have seen inflation around material cost inputs, asphalt costs and roofing, and particularly delivery costs, really accelerating and continuing to move up in a way that we've got announced price increases that we should be able to offset if we see some stability there. But I think our Q4 outlook around price costs neutral on all inflationary costs, it's going to be highly dependent now in terms of what we see around asphalt and other energy cost inflation and delivery cost inflation. So So we're going to continue to focus, as Todd talked about, in terms of some price realization. Our teams continue to look for all ways to offset these incoming costs. Our sourcing team is working hard. Our supply chain team is working hard. Our manufacturing team is identifying productivity offsets. So we're going to look at trying to get price-cost neutral, but we're also looking holistically of how we sustain margins in this inflationary environment. I will say, though, over time, we've got a great track record of achieving and overcoming asphalt inflation through price and getting back to pricing that offsets all inflation. But depending on the market environment we face on some of the costs that are coming at us, it's going to be a little bit more dependent if we see that by Q4, if that trades into 2027.

Your next question comes from the line of Sam Reed with Wells Fargo. your line is now open. Please go ahead.

Thanks, everyone. Another question on roofing here. I've heard in the prepared remarks, some comments on broader placement and perhaps some new geographies, and I believe that was specific to the roofing category. Did any of that show up in the second quarter in the form of extra sell-in? Is there some sort of sell-in dynamic contemplated in your third quarter guidance. Just help us unpack that dynamic.

Yes, and actually the comment was more on doors specific than in roofing. So in roofing, we continue to invest in our contractor engagement model. We continue to add contractors to our network. We continue to see a larger portion of our shingle demand through that dedicated and very focused OC contractor network. So we continue to see that bridging in there um but in distribution and roofing we're very balanced uh we continue to to to take that approach and see good results by giving our contractors the widest view in terms of how they want to service their business my my comments were more around uh the doors business where we continue to bring our commercial strength uh into that business and really following the same playbook we've we've done in roofing and insulation over time which is we're investing heavily in downstream demand creation particularly with dealers and builders we're starting to see that come through and we saw that coming through in order volumes in our doors business in q2 we continue to look at broader distribution that values the full product line of roofing insulation and doors and we've been able to get some placement in the quarter that's generated some incremental volume in our doors business and we continue to see that strength continue to grow in terms of giving us some new locations in terms of where we can get stocking positions with our Doors business. So that's really the reference of what we're seeing in terms of the broad commercial strength. And we're building a lot of very good market momentum around our downstream pull-through strategy, around our broad complementary product offering to distribution partners that want to stock all three. And that's ultimately coming through with some better volumes that we saw in Q2 in the Doors business that we can continue in the back half of the year.

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

Hey, thank you for taking my question today. You talked in the prepared remarks about some, I believe, AI efforts to help kind of customers, I think, manage demand and help find new opportunities. And you said you're already seeing some value and kind of expect to roll this out further across the segments and the company. Can you just talk a little bit more about that and put a finer point to kind of the value you're seeing now, expectations for the future, and timing for that kind of rollout? Thank you.

Thanks very much, Brian. Yeah, I think like most companies, we're exploring a lot of use cases of how we're applying particularly a generic AI, generative AI into our business operations. And a lot of this focus has been on administrative functions and operations. Last call, I talked about how we're expanding AI into our manufacturing processes that we can evaluate data just much faster and make decisions around process improvements, around our quality systems that we're deploying AI models and tools around. And then this was example commercially where we're doing it. One example of many kind of use cases and pilots we're putting into the commercial teams. But this one's specific to our ability now to look at a lot of our purchasing data from particular distribution customers or contractor preferences and analyze large quantities of data. And now we can start to spot trends through this AI model in terms of any changes in purchasing patterns, purchasing behaviors, product choices. That now gets a summary report by location, by distributor, by customer in a way to our, and directly out to our commercial sales team where they can look at that and then take some action and follow up and say what's driving that change in purchasing behaviors. And that's allowed us to be in front of some changes to identify opportunities inside our roofing business. So we've done enough of the pilot now and we've seen enough benefits from that in terms of giving our commercial teams access to information that they can go take into our customers and have great conversations around that we're going to be rolling that out across the company. So I think one example again of how we're trying to deploy added tools to be more efficient, more effective, be better service partners for our customers and that's starting to see some results in roofing today that we expect will generate some good results in our insulation and doors business as we roll this So your next question comes from the line of Adam Baumgarten with Vertical Research.

Your line is now open. Please go ahead.

Hey, good morning, everyone. You mentioned a couple of insulation plant rebuilds in 27. You know, with a ramp up of Nephi cover that capacity that'll temporarily be down or I'm just trying to figure out how your net North America residential capacity will look in 27 versus 26.

Thanks, Adam. Yeah, let me tackle that. So Nephi will help. Nephi is a small asset though, but having it up for a full year will offset some of the impact that we're seeing. What we really designed into the new Kansas City line is flexibility to serve multiple parts of the market. So Kansas City is a larger line. And while we started up on technical insulation, it has the benefit of also giving us flexibility then broader in the network to make sure we can meet expected customer demand as we get into the year.

Your next question comes from the line of Colin Varen with Deutsche Bank. Your line is now open. Please go ahead.

Morning, thanks for taking my question. I was just hoping you can help bridge and quantify some of the moving pieces around the 400 basis point sequential decline in roofing EBITDA margin you're expecting from Q2 to Q3. You're taking some price in June, so I think there could be some benefit from price. So I guess I'm just trying to understand some of the headwinds that you might be seeing. how much of that's volume deleverage versus maybe the absence of tariff refunds or worsening price costs. Thank you.

Yeah, thanks. It really is primarily going to be driven by the volume and volume leverage. That's the biggest change on a quarter and quarter sequentially. We are seeing some incremental inflation. We're also expecting to see some incremental pricing. But, you know, so when we look at that price cost, we are still guiding to that's going to be negative. So that still creates that creates a little bit of headwinds but i'd say the vast majority of that 400 basis much decline is tied to volume primarily just volume loss and a little bit of volume leverage and then third smaller elements a little bit of negative price cost that embeds in there but overall again i'd say even with those changes down if i just step back the performance of the business is still very strong on these kind of volumes still generating 30 percent ebitda margins inside of our guide. So we still feel like the strength and durability of the business is there, although there's a little bit of volatility quarter to quarter in terms of the volumes that we're seeing in shipments.

Your next question comes from the line of Matthew Boulay with Barclays. Your line is now open. Please go ahead.

Morning, everyone. Thank you for taking the question. I wanted to go back to the insulation volumes and, you know, this kind of strong volume outlook in both North America non-res, you mentioned data center, and then in Europe, you mentioned building changes. And I heard you loud and clear that, you know, this is also the reflection of a lot of the investments you've been making in the past kind of coming to fruition here. So I know you obviously kind of kept the forward view capped here at the Q3 guide, and you're not going to guide beyond that. But my question is, do you have some visibility to the backlog here?

Or, you know, if there is kind of a sense if there's if there's a broader or longer trend going on here in these two categories or if there's anything we should understand around sort of near-term lumpiness that that's helping you right now thank you very much thanks matt i appreciate the the question so our view would be the the commercial strength we're seeing there's a combination of structural changes that we've made investments that we've made the product portfolio that we have the the geography focus the product segment focus in both of those businesses combined with some pockets of good market conditions. So when we look at Europe, Europe has been weak since the Ukraine invasion. We're starting to see some green shoots in the markets that we serve in Europe that are encouraging. Much like the U.S., Europe is underbuilt, though, because it's been a number of years of seeing construction activity below long-term averages. So our view would be that Europe is due for sort of, you know, stronger market conditions, and we're really well positioned to serve those markets. When the rebuilding of Ukraine starts to really heat up, that could be another catalyst for strength in Europe over time, and we really haven't seen that in our results yet. When we look at non-res in North America, the pockets of strength are related to data centers. You know, Healthcare has been good. Some of the interiors businesses have been good. We're seeing the reindustrialization of the U.S. benefit us from a process technology as well as a building insulation standpoint. So you know, that should continue for a bit longer. You know, at some point that may taper off as a result of companies that have kind of onshored back to the U.S. that won't do it again. but for the near term we're seeing good strength in in that north american non-res piece of the business as well there are no further questions at this time i will now turn the call back to brian chambers for closing remarks great thanks i want to thank everyone for making time to join us on today's call and for your ongoing interest in no one's corning we look forward to speaking to you again on our third quarter call thanks and have a safe day this concludes today's call Thank you for attending.

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