Hello, everyone. Thank you for joining us and welcome to the Spruce Powered Second Quarter 2026 Earning Results Conference Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Julia Gaspar, Corporate Development and Investor Relations. Julia, please go ahead.

Thank you, Operator. Good afternoon, everyone, and welcome to Spruce Power's second quarter 2026 earnings conference call. Joining me today are Chris Hayes versus Chief Executive Officer and Tom Cimino, the company's Chief Financial Officer. Before we begin, I would like to remind you that we will comment on our financial performance using both GAAP and non-GAAP financial measures. Important information about these non-GAAP financial measures, including reconciliations to the most comparable GAAP measures, is included in our earnings release for the second quarter of 2026, which is available on the Investor Relations section of our website. Our discussion today will also include board-looking statements that reflect management's current expectations and are subject to risks and uncertainties that could cause actual results to differ materially. Please refer to our earnings release and SEC filings for a discussion of these risk factors. With that, I will now turn the call over to Chris Hayes, Chief Executive Officer of Spruce Power. Chris?

Thanks, Julia, and good afternoon, everyone. We delivered a solid second quarter and executed against the priorities we outlined at the beginning of the year. disciplined execution across the organization enabled us to deliver operating EBITDA ahead of the prior year. We also generated higher operating income, returned to positive gap net income, and reduced debt while maintaining a disciplined approach to liquidity. Revenue totaled $30.3 million compared with $33.3 million in the prior year period. Despite the decline in revenue, income from operations increased 10% to $9.8 million. Net income attributable to stockholders was $3.3 million, or $0.14 per diluted share, compared with a net loss attributable to stockholders of $3 million, or $0.17 per diluted share in the second quarter of 2025. The composition of the quarter is important. Combined PPA and SLA revenue increased 2% year-over-year to $22.5 million, and our portfolio generated approximately 196,000 megawatt-hours of power, up from 187,000 megawatt-hours a year ago. Lower SP5 SREC production and a slower-than-anticipated ramp in Spruce Pro Revenue were the principal revenue headwinds. Those two factors were distinct from the underlying performance of our recurring customer portfolio, which remains stable. At the same time, core operating expenses, which include SG&A and O&M, declined 21% year-over-year to $13.8 million and remained below $15 million for the fourth consecutive quarter. SG&A expense declined 26% to $11.3 million, primarily reflecting lower labor and professional services costs from our project to streamline operating expenses. The year-over-year improvement is particularly notable because second quarter SG&A also includes a number of non-recurrent costs. Excluding these discrete items, the underlying cost structure continues to demonstrate the structural benefits of the efficiency actions we implemented over the past several quarters. O&M expense was $2.5 million compared with $2.2 million in the prior year quarter. O&M was favorable relative to plan because non-routine service activity ramped more gradually than anticipated during the first half. Routine O&M also benefited from discipline around fleet, mailing, and administrative costs. We expect service volumes to increase during the second half of the year, which should bring full-year O&M spending closer to our original plan. Our in-house field services model continues to be an important part of that operating strategy. We have reduced servicing costs across our New Jersey portfolio and are extending the same approach into Southern California. As the rollout matures, we believe it can lower servicing costs per system, shorten repair cycle times, and give us greater control over service quality and system uptime. operationally our approximately 83 000 customer contracts generated recurring customer payments under long-term agreements across a geographically diversified portfolio our customer satisfaction score was 80 for the quarter reflecting the focus of our teams on customer service and operational execution we are evaluating practical opportunities to use automation and artificial intelligence across customer service, asset management, finance, and other core functions. The focus is on targeted applications that can reduce manual work, improve data quality and service levels, and support productivity without adding unnecessary overhead. Turning to liquidity and financing, we preserved liquidity and reduced debt during the quarter. We ended the quarter with total cash and restricted cash of $81.5 million and repaid $7.9 million of debt principal. Tom will discuss the quarter end balances in more detail. Refinancing remains a critical near-term priority. As required under GAAP, our quarter end financial statements include a going concern disclosure because the SP1 and SP2 maturities fall within 12 months of the financial statements issuance dates, and we had not entered into committed refinancing arrangements as of that date. The current classification of SP1 and SP2 caused the reported negative working capital position at quarter end. We are in preliminary discussions with potential lenders regarding SP1 and are evaluating refinancing alternatives for both SP1 and SP2. We recognize the importance and timing of these maturities and are approaching the process with appropriate urgency. Our objective is to complete refinancing solutions ahead of the applicable maturities while preserving liquidity and maintaining a capital structure appropriate for the scale and maturity of the portfolio. Looking ahead, our priorities are unchanged. First, continue to improve the efficiency, service quality, and profitability of our operating platform. Second, execute our refinancing initiatives while maintaining disciplined liquidity management. And third, take a disciplined approach to growth, including portfolio acquisitions, programmatic partnerships, and Spruce Pro servicing relationships. Overall, the quarter demonstrates that our cost control actions are translating into stronger profitability. We are focused on disciplined execution through the second half of 2026. With that, I will turn the call over to Tom.

Thanks, Chris, and good afternoon, everyone. I will begin with a more detailed review of our second quarter financial results. Revenue totaled $30.3 million compared to $33.3 million in the second quarter of 2025. Sequentially, revenue increased from $23.4 million in the first quarter, consistent with the seasonal pattern of our solar production and customer payments. On a year-over-year basis, combined PPA and lease revenue increased by $400,000. That increase was more than offset by a $1.4 million reduction in performance-based incentive revenue, a $1.1 million reduction in SREC revenue, and a net $900,000 reduction in other revenue, of which $600,000 was non-cash. Turning to expenses, total operating expenses were $20.6 million, down 16% from $24.4 million in the prior year period. Solar energy service system depreciation was essentially flat at $7.3 million. Core operating expenses totaled $13.8 million compared with $17.4 million in the second quarter of 2025. SG&A expense was $11.3 million, down 26% year over year. The decrease primarily reflected the benefits of our project to streamline operating expenses, including lower labor and recurring professional service costs. These positives were somewhat offset by the non-recurring professional fees related to corporate strategy, refinancing, and legal costs. O&M expense was $2.5 million compared with $2.2 million in the prior year period. The year-over-year increase reflects extra efforts to reduce the outstanding service ticket backlog. At the same time, the O&M increase was offset by lower routine recurring costs as a result of streamlined contract negotiations. For the first six months of 2026, O&M expense was down approximately 40% year-over-year, reflecting the concentration of elevated non-routine activity in the first half of 2025. Operating EBITDA for the quarter was $26.5 million compared with $24.6 million in the second quarter of 2025. The result was ahead of the prior year as lower operating costs offset the revenue decline. Income from operations increased to $9.8 million from $8.9 million in the prior year period. Net income attributable to stockholders improved to $3.3 million from a net loss of $3 million in the second quarter of 2025. The improvements in net income reflect lower operating expenses and a favorable year-over-year change in the non-cash valuation of our interest straight swaps. Cash used in operating activities was $3.2 million during the quarter, reflecting working capital timing, primarily higher SREC receivables, of which the majority were fully collected in July. After including recurring cash proceeds from the SEMTH master lease and customer buyouts and prepayments, adjusted cash flow from operations was a positive $4.8 million we ended the quarter with total cash of 81.5 million including 44.7 million of unrestricted cash the total cash balance benefited from reduced core operating expenses offset by increased debt service payments in part due to the timing of the mezzanine debt service occurring only twice a year as well as higher legal cost during the quarter we repaid 7.9 million dollars of debt principal Total debt principal outstanding as of June 30th, 2026 was $680 million. The gap carrying amount, net of unamortized fair value adjustments and deferred financing costs was $663 million. Our interest rate swaps covered 91% of our floating rate term debt, and we remain in compliance with all covenants under our credit agreements at quarter end. The SB1 facility matures on January 30th, 2027. if we obtain an executed term sheet for long-term financing by October 30th, 2026. The SB2 facility matures on May 14th, 2027. We have commenced preliminary lender discussions regarding SB1 and continue to evaluate refinancing alternatives for both facilities with the objective of completing the respective transactions ahead of their maturities. We can provide no assurance regarding the timing, terms, or completion of any refinancing transactions. Looking ahead, our current full-year forecast is unchanged. On revenue, we expect PTA and lease revenue to remain generally consistent with the performance of the portfolio through the first half and the normal seasonal patterns. We continue to monitor SREC production and revenue, particularly around SP5, and expect revenues to be in line with the first half of the year. On expenses, we expect the first half O&M favorability to be largely offset by higher service activity during the second half, resulting in full-year O&M broadly in line with start-of-the-year expectations. We expect recurring SG&A to trend from an approximately $11 million quarterly level toward approximately $10 million in the fourth quarter. Taken together, we believe the business remains positioned to generate stable recurring portfolio cash flows from operations while continuing to improve operating efficiency and advance our financing objectives. With that, I'll turn the call back over to Chris for closing comments.

Thanks, Tom. To summarize, our second quarter results demonstrate the resilience of the business model. Our core contracted PPA and lease revenue remain stable, while the operating improvements implemented over the past year translated into a structurally lower cost-based and year-to-date operating EBITDA 21% ahead of the prior year. As we move through the second half of 2026, our priorities are clear. Execute our refinancing initiatives, maintain disciplined liquidity management, continue improving service and operating efficiency, and pursue growth only where the expected returns justify the capital and incremental overhead. We appreciate the continued support of our investors and look forward to updating you again next quarter. Operator, please open the line for questions.

We will now begin the question and answer session. 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. There are no questions at this time. This concludes today's call. Thank you for attending. You may now disconnect.