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$TEAM Q1 2027 earnings: Atlassian lifts its outlook, but second-half growth slows to 9% Atlassian's cloud business keeps growing faster than it planned, while its old server product fades more slowly. Revenue rose 24%, and the backlog of contracted revenue grew 44% as large customers signed longer deals, chief executive Mike Cannon-Brookes said. Margins ran far above plan, but by our math the raised outlook still has revenue growth slowing to about 9% in the second half. • Revenue: $𝟭,𝟳𝟳𝟮 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 (+24% from a year ago) • Cloud revenue growth: 𝟯𝟬.𝟱% (plan was about 28.5%) • Operating margin, excluding one-offs: 𝟯𝟮.𝟱% (22.5% a year ago) • Full-year revenue outlook: 𝗥𝗮𝗶𝘀𝗲𝗱 𝘁𝗼 𝟭𝟯.𝟳𝟱% 𝗴𝗿𝗼𝘄𝘁𝗵 (from 13% three months ago) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🟢 Bullish The story got better, because Cloud, the part of the business that carries the future, beat its plan and the company lifted every target it set three months ago. The bad news: the Data Center beat came from hybrid deals that keep revenue in the old product, and the plan allows slightly less new subscription revenue over the rest of the year than Atlassian added a year earlier. The question now is whether the second-half slowdown is only last year's Data Center licence timing or also cooler demand. Contracted revenue says timing; the subscription target, which removes that timing and still slows to 18.5%, says partly demand. Next quarter's net new subscription revenue will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢🟢 𝗖𝗹𝗼𝘂𝗱 𝗚𝗿𝗲𝘄 𝟯𝟭% 𝗮𝗻𝗱 𝗕𝗲𝗮𝘁 𝗜𝘁𝘀 𝗢𝘄𝗻 𝗣𝗹𝗮𝗻 Cloud is the version of Atlassian's software that the company hosts for customers, and it now makes up almost three quarters of revenue. Cloud revenue grew 30.5% to $1,302 million. That beat the 28.5% the plan called for, even though hybrid deals with large customers booked part of their spending under Data Center instead. Finance chief James Chuong said migrations from Data Center added mid-to-high single digits to that growth, so most of it came from existing Cloud customers adding seats and buying bundles. Teamwork Collection, the bundle of Jira, Confluence and Loom with extra AI credits, now has more than 3,000 customers, seven times a year ago. • Service Collection, the help-desk bundle: more than 70,000 customers, recurring revenue above $1 billion growing over 30% • Net revenue retention, what existing customers spend versus a year ago: above 120%, Cannon-Brookes said • Cloud share of revenue: 73.5% this quarter, from 69.6% a year ago This matters because Cloud is where Atlassian sells its AI features, so the faster it grows the less the fading Data Center line weighs on the total. But the plan has Cloud slowing to 27% next quarter and, by our math, to about 24% in the second half, and Chuong gave no reason beyond the DX acquisition lapping and harder comparisons. What to watch: Cloud revenue growth next quarter against the 27% plan. A result near 30% again would show the second-half plan is cautious rather than a forecast of cooling demand, because the hybrid deals that held back this quarter would then have been absorbed. 🟢 𝗖𝗼𝘀𝘁𝘀 𝗙𝗲𝗹𝗹 𝗙𝗮𝘀𝘁𝗲𝗿 𝗧𝗵𝗮𝗻 𝘁𝗵𝗲 𝗣𝗹𝗮𝗻 𝗔𝗹𝗹𝗼𝘄𝗲𝗱 Atlassian cut about a tenth of its staff last spring, and this is the first quarter where the savings show with no restructuring charge against them. Operating margin excluding one-offs reached 32.5%, against the 28.5% the plan called for. On a GAAP basis the margin reached 10.7%, against a 6.5% plan. • Research and development: 42.8% of revenue, from 52.8% a year ago • General and administrative: 9.7% of revenue, down 2.7 percentage points • Stock-based pay: 20.1% of revenue, from 24.5% • Last year's restructuring charge: 3.9 points of revenue; none this year The letter credits revenue running ahead of plan, slower hiring and "lower-than-expected operating costs". Part of that is timing of spend, which the letter says itself, so the full-year plan of 25.5% stays well below this quarter. The gap is where the company has beaten every margin plan for a year. What to watch: operating margin excluding one-offs next quarter against the 26% plan. Another result several points above it would mean the cost base, not the timing of spend, is what changed after the restructuring. 🟢 𝗟𝗮𝗿𝗴𝗲 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝗦𝗶𝗴𝗻 𝗟𝗼𝗻𝗴𝗲𝗿 𝗖𝗼𝗻𝘁𝗿𝗮𝗰𝘁𝘀 Remaining performance obligations, the revenue Atlassian has under contract but not yet delivered, reached $4,746 million, up 44% from a year ago. Chief executive Mike Cannon-Brookes named Infosys, SAP, Workday and Westpac as customers that expanded this quarter, and said customers spending over $1 million a year grew more than 30%. The caution is that contracts are getting longer, so the headline overstates near-term revenue: the part due within twelve months grew 28%, in line with revenue. Even so, both rates run far above the 13.75% the full-year plan calls for, which is why the outlook reads as cautious rather than as a forecast of weaker demand. What to watch: the twelve-month portion of contracted revenue next quarter. If it keeps growing near 28% while revenue growth slows toward 15%, the slowdown is a matter of when revenue is recognised, not of how much customers buy. 🟢 𝗙𝘂𝗹𝗹-𝗬𝗲𝗮𝗿 𝗣𝗹𝗮𝗻 𝗥𝗶𝘀𝗲𝘀 𝗼𝗻 𝗘𝘃𝗲𝗿𝘆 𝗟𝗶𝗻𝗲 Atlassian raised all seven lines of its full-year outlook three months after setting them, including the target for subscription recurring revenue, now 18.5% growth. Finance chief James Chuong said the Cloud beat flows through to the full year, but the $33 million Data Center beat does not, because of "timing mechanics" in how upfront licence revenue is booked. That is why the revenue target rose by about $49 million by our math while the quarter beat the middle of its range by $62 million. Atlassian has now beaten the top of its quarterly revenue range eight quarters in a row. The beats ran from 0.3% to 6.6%, so a raise smaller than the beat fits the pattern rather than signalling doubt. What to watch: next quarter's revenue against the $1,825–1,835 million range. A beat of the usual size would, by our math, put the year on track for about 15% growth even if the second half only matches the current plan. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗔𝗴𝗲𝗻𝘁 𝗨𝘀𝗲 𝗚𝗿𝗲𝘄 𝟭𝟱𝘅, 𝗥𝗲𝗰𝘂𝗿𝗿𝗶𝗻𝗴 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗚𝗿𝗼𝘄𝘁𝗵 𝗛𝗲𝗹𝗱 "The value of Jira and Confluence for coordination in the AI era is even stronger than it has been in the past," Cannon-Brookes told an analyst who asked whether AI coding agents reduce the need for his tools. His evidence is usage: 2 million people a month now use the Atlassian MCP Server, the connector that lets outside AI agents read and write Jira and Confluence, and they make 15 million tool calls a day. The numbers that pay the bills did not move with that usage. Subscription recurring revenue has grown between 22% and 23% for four quarters, and the full-year plan has it slowing to 18.5%. Atlassian charges per user, and agents do not buy seats. Usage-based pricing starts in December, but Cannon-Brookes said "we're not assuming any meaningful UBP revenue in FY '27 at the moment". The company's answer is the bundle: customers on Teamwork Collection run twice as many agents and add Jira and Confluence seats faster than others, so AI sells seats indirectly. That is plausible, but it keeps AI revenue invisible. A platform whose agent traffic rose 15 times while seat-based growth stayed in the low twenties has not yet shown that agents are paying customers rather than free users. What to watch: subscription recurring revenue growth next quarter, set against the 22.5% just reported. A reading that slips toward the 18.5% full-year plan while agent traffic keeps multiplying would mean usage and paid seats have parted ways, and the pricing change in December would become the only route to AI revenue. 🔴 𝗧𝗵𝗲 𝗣𝗹𝗮𝗻 𝗛𝗮𝘀 𝗡𝗲𝘄 𝗦𝘂𝗯𝘀𝗰𝗿𝗶𝗽𝘁𝗶𝗼𝗻 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗦𝗵𝗿𝗶𝗻𝗸𝗶𝗻𝗴 Subscription ARR is the yearly value of Atlassian's active Cloud and Data Center subscriptions. It added $206 million in the quarter, more than the $177 million a year earlier, and reached $6,812 million. The full-year target of 18.5% growth, raised half a point, still points to a slowdown from here. By our math that target leaves about $1,016 million of new subscriptions over the next three quarters, against $1,047 million in the same period last year, a 3% decline. The letter gives the reason: "the expected contraction in Data Center as customers expand less ahead of their migration to the Cloud". Chuong added that the DX acquisition laps in Q2 and the second half faces harder comparisons. What to watch: net new subscription revenue in Q2, against the $450 million added in the same quarter last year. By our math the plan needs about $340 million a quarter, so a Q2 figure near last year's would mean the full-year target is cautious rather than a sign that Cloud customers are buying less. 🔴 𝗔𝗜 𝗖𝗼𝘀𝘁𝘀 𝗣𝘂𝘀𝗵 𝘁𝗵𝗲 𝗚𝗿𝗼𝘀𝘀 𝗠𝗮𝗿𝗴𝗶𝗻 𝗣𝗹𝗮𝗻 𝗗𝗼𝘄𝗻 Gross margin is the share of revenue left after the cost of hosting and supporting the software. It reached 85.2% this quarter, up 3.2 points from a year ago, though 2.2 points of that come from a restructuring charge in last year's figure. The letter credits cheaper cloud infrastructure and "intelligent multi-model routing through our AI Gateway", which sends each AI task to the cheapest adequate model. The plan still points the other way: 84.5% for Q2 and for the year, below this quarter, because of "growing usage of Rovo and hosting costs as more of our business shifts to Cloud". Rovo is the AI assistant included in subscriptions, so every extra query is a cost with no matching revenue until usage-based pricing produces some. What to watch: Q2 gross margin against the 84.5% plan. A reading below 85% would mean AI usage has begun to outrun the efficiency gains that offset it this quarter, and the cost of giving Rovo away would start to show. 🔴 𝗗𝗮𝘁𝗮 𝗖𝗲𝗻𝘁𝗲𝗿 𝗕𝗲𝗮𝘁 𝗕𝗲𝗰𝗮𝘂𝘀𝗲 𝗠𝗶𝗴𝗿𝗮𝘁𝗶𝗼𝗻𝘀 𝗧𝗮𝗸𝗲 𝗬𝗲𝗮𝗿𝘀 Data Center is the version of Atlassian's software that customers run on their own servers, and support for it ends in March 2029. Its revenue was meant to fall 4% this quarter; instead it grew 4.8%. Chuong said large customers signed hybrid deals that let them move to Cloud over several years, and "because we don't charge customers twice on these hybrid deals", the arrangement "meant slightly more revenue on Data Center and slightly less on Cloud this quarter". He called the effect on Cloud "modestly less than what we had expected" but gave no figure. The plan keeps the decline coming: 14% in Q2 and, by our math, about 24% in the second half. Atlassian also set its government-cloud certification dates at July 2028 and January 2029, which an analyst noted leave some customers on Data Center past the end-of-support date; Chuong did not say how many. What to watch: Data Center revenue in Q2 against the 14% decline the plan calls for. Another quarter of growth would mean hybrid deals are holding revenue in the old product and the Cloud figures understate how far the migration has gone. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗧𝗵𝗲 𝗣𝗹𝗮𝗻 𝗔𝘀𝘀𝘂𝗺𝗲𝘀 𝗮𝗻 𝗨𝗻𝗰𝗲𝗿𝘁𝗮𝗶𝗻 𝗘𝗰𝗼𝗻𝗼𝗺𝘆 The letter says the outlook "contemplates the ongoing macroeconomic, fiscal, and geopolitical uncertainty" and the continued build-out of the enterprise sales force. Chuong repeated the point on the call and gave no example of a customer delaying a purchase. Revenue grew 25% in the Americas and 24% in Europe, the Middle East and Africa; Asia Pacific grew 18%. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝘄𝗶𝘁𝗵 𝗼𝘃𝗲𝗿 $𝟭𝟬,𝟬𝟬𝟬 𝗶𝗻 𝗖𝗹𝗼𝘂𝗱 𝗔𝗥𝗥 (𝟮𝟳𝗤𝟭): 𝟱𝟵,𝟴𝟳𝟳 ⇗ accelerating Growing faster again: up 12.9% from a year ago, after three quarters near 10%. These are the paying accounts that make up more than 85% of Cloud recurring revenue, so a rising count means new customers are crossing the threshold, not only old ones spending more. 𝗗𝗲𝗳𝗲𝗿𝗿𝗲𝗱 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 (𝟮𝟳𝗤𝟭): $𝟮,𝟯𝟵𝟰 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Barely moved against a fast-growing business: up 4.9% from a year ago while revenue grew 24%. Deferred revenue is cash customers have paid for service not yet delivered, and it fell 10% from June because most annual bills go out in the spring. The growth in commitments now shows up in multi-year contracts, which sit in remaining performance obligations rather than here. 𝗗𝗶𝗹𝘂𝘁𝗲𝗱 𝘀𝗵𝗮𝗿𝗲 𝗰𝗼𝘂𝗻𝘁 (𝟮𝟳𝗤𝟭): 𝟮𝟱𝟲.𝟵 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Down 2.3% from a year ago after the company bought 3.3 million shares in the quarter. The $588 million of buybacks on the cash flow statement exceeded free cash flow of $463 million, so cash minus long-term debt fell to about $130 million from $250 million in June. The letter plans a roughly flat share count for the year, with $1.3 billion of authorisation left. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗙𝗬𝟮𝟳 𝘁𝗼𝘁𝗮𝗹 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗴𝗿𝗼𝘄𝘁𝗵: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 𝟭𝟯.𝟳𝟱% ⇘ decelerating 🠅 raised from approximately 13.0% Raised. The plan now has revenue growing about 13.75% this year, roughly $49 million more than before by our math. Most of the quarter's $62 million beat came from Data Center licence timing, so it did not all flow through. By our math the plan leaves about 9% growth for the second half, against 30% in the same half last year. 𝗤𝟮 𝘁𝗼𝘁𝗮𝗹 𝗿𝗲𝘃𝗲𝗻𝘂𝗲: $𝟭,𝟴𝟮𝟱–𝟭,𝟴𝟯𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating New. The middle of the range means about 15% growth from a year ago and 3% from this quarter. Atlassian has beaten the top of its quarterly range for eight straight quarters, by 0.3% to 6.6%. If the pattern holds, Q2 lands near $1,916 million by our math. 𝗙𝗬𝟮𝟳 𝗖𝗹𝗼𝘂𝗱 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗴𝗿𝗼𝘄𝘁𝗵: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 𝟮𝟲.𝟬% ⇘ decelerating 🠅 raised from approximately 25.5% Raised half a point. By our math the plan leaves about 24% growth for the second half, from 30.5% this quarter. The letter expects the first half to grow faster than the second, because the DX acquisition closed in November 2025 and the comparisons get harder. Migrations from Data Center should keep adding mid-to-high single digits to the year. 𝗤𝟮 𝗖𝗹𝗼𝘂𝗱 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗴𝗿𝗼𝘄𝘁𝗵: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 𝟮𝟳.𝟬% ⇘ decelerating New. A step down of 3.5 points from this quarter's rate, about $1,355 million by our math. The acquisition of DX laps in Q2, which the prior outlook put at about one point of growth, so the rest of the step is caution or the business itself. 𝗙𝗬𝟮𝟳 𝗗𝗮𝘁𝗮 𝗖𝗲𝗻𝘁𝗲𝗿 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗴𝗿𝗼𝘄𝘁𝗵: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 (𝟭𝟲.𝟬%) ⇄ reversing 🠅 raised from approximately (17.0%) Raised one point, still a decline. Hybrid deals keep some revenue in Data Center for longer. By our math the plan has the line falling about 24% in the second half, when last year's pull-forward of licence revenue is lapped. 𝗤𝟮 𝗗𝗮𝘁𝗮 𝗖𝗲𝗻𝘁𝗲𝗿 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗴𝗿𝗼𝘄𝘁𝗵: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 (𝟭𝟰.𝟬%) ⇄ reversing New. The first quarterly decline of the transition, after growth of 4.8% this quarter. The same quarter last year grew 20%, partly on purchases pulled forward by the end-of-life announcement, so the comparison is hard. 𝗙𝗬𝟮𝟳 𝗠𝗮𝗿𝗸𝗲𝘁𝗽𝗹𝗮𝗰𝗲 𝗮𝗻𝗱 𝗼𝘁𝗵𝗲𝗿 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗴𝗿𝗼𝘄𝘁𝗵: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 𝟭𝟱.𝟬% ⇘ decelerating 🠅 raised from approximately 12.0% Raised three points on better than expected sales of third-party apps. The line is small, about 4.5% of revenue, and Atlassian takes a lower cut on Cloud apps than on Data Center apps, so the mix shift to Cloud works against it. 𝗤𝟮 𝗠𝗮𝗿𝗸𝗲𝘁𝗽𝗹𝗮𝗰𝗲 𝗮𝗻𝗱 𝗼𝘁𝗵𝗲𝗿 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗴𝗿𝗼𝘄𝘁𝗵: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 𝟮𝟬.𝟬% ⇘ decelerating New. About 20% growth from a year ago, down from 27% this quarter. The company set the first-quarter plan at 12.5% and delivered more than double, so this is a more generous starting point. 𝗙𝗬𝟮𝟳 𝗦𝘂𝗯𝘀𝗰𝗿𝗶𝗽𝘁𝗶𝗼𝗻 𝗔𝗥𝗥 𝗴𝗿𝗼𝘄𝘁𝗵: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 𝟭𝟴.𝟱% ⇘ decelerating 🠅 raised from approximately 18.0% Raised half a point, to about $7,828 million of annual recurring subscriptions by our math. The target allows fewer new subscriptions over the rest of the year than a year earlier, which the letter attributes to Data Center customers expanding less before they migrate. 𝗤𝟮 𝗴𝗿𝗼𝘀𝘀 𝗺𝗮𝗿𝗴𝗶𝗻: 𝟴𝟰.𝟱% 𝗚𝗔𝗔𝗣, 𝟴𝟲.𝟱% 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀 ⇘ decelerating New. Below this quarter's 85.2% and 87.2%, because of Rovo usage and hosting costs as more revenue moves to Cloud. The full-year figures are the same, so the plan assumes no further gain from the model-routing savings seen this quarter. 𝗙𝗬𝟮𝟳 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗺𝗮𝗿𝗴𝗶𝗻: 𝟱.𝟬% 𝗚𝗔𝗔𝗣, 𝟮𝟱.𝟱% 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀 ⇘ decelerating 🠅 raised from 4.5% GAAP, 25.0% excluding one-offs Raised half a point on both bases. The year still sits far below this quarter's 32.5% excluding one-offs, because Atlassian moved about three points of pay from stock to cash and last year's margin had four points of Data Center timing help. By our math the plan leaves about 22% for the second half. 𝗤𝟮 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗺𝗮𝗿𝗴𝗶𝗻: 𝟰.𝟱% 𝗚𝗔𝗔𝗣, 𝟮𝟲.𝟬% 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀 ⇘ decelerating New. A drop of 6.5 points from this quarter excluding one-offs, and of 6.2 points on a GAAP basis. The company has beaten its quarterly margin plan in each of the past five quarters, so the record argues the figure is a floor. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗖𝗹𝗼𝘂𝗱 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗱𝗶𝗱 𝗵𝘆𝗯𝗿𝗶𝗱 𝗱𝗲𝗮𝗹𝘀 𝗺𝗼𝘃𝗲 𝘁𝗼 𝗗𝗮𝘁𝗮 𝗖𝗲𝗻𝘁𝗲𝗿? Chuong said the effect was smaller than expected but declined to give a figure. Without it, readers cannot tell how much of the Cloud slowdown in the Q2 plan is accounting rather than demand. 𝗪𝗵𝗮𝘁 𝗶𝘀 𝗖𝗹𝗼𝘂𝗱-𝗼𝗻𝗹𝘆 𝗿𝗲𝗰𝘂𝗿𝗿𝗶𝗻𝗴 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗴𝗿𝗼𝘄𝗶𝗻𝗴? Subscription ARR mixes Cloud with a Data Center line the company expects to contract. A Cloud-only figure would show whether the 18.5% full-year target hides a Cloud business still growing near 30%. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗗𝗮𝘁𝗮 𝗖𝗲𝗻𝘁𝗲𝗿 𝘀𝘁𝗮𝘆𝘀 𝗽𝗮𝘀𝘁 𝗠𝗮𝗿𝗰𝗵 𝟮𝟬𝟮𝟵? Government certification dates now run to January 2029, two months before support ends. An analyst asked what share of Data Center revenue will remain after the deadline; management answered with migration pace, not a number. 𝗜𝘀 𝘁𝗵𝗲 𝟮𝟬% 𝘁𝗵𝗿𝗲𝗲-𝘆𝗲𝗮𝗿 𝗴𝗿𝗼𝘄𝘁𝗵 𝘁𝗮𝗿𝗴𝗲𝘁 𝘀𝘁𝗶𝗹𝗹 𝗶𝗻 𝗳𝗼𝗿𝗰𝗲? By our math the new plan implies a 19.7% compound rate from FY24 to FY27, just short of the target repeated for two years. Management has not mentioned it for three quarters. 𝗪𝗵𝗮𝘁 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗱𝗼 𝗥𝗼𝘃𝗼 𝗰𝗿𝗲𝗱𝗶𝘁𝘀 𝗮𝗻𝗱 𝗯𝘂𝗻𝗱𝗹𝗲 𝘂𝗽𝗴𝗿𝗮𝗱𝗲𝘀 𝗽𝗿𝗼𝗱𝘂𝗰𝗲? AI is sold through Collections and edition upgrades, with usage-based pricing starting in December. A dollar figure would show whether agent use is paying for the AI costs that pull the gross margin plan down.

$NRDS Q3 2026 earnings: NerdWallet grows 11%, but it cuts its profit outlook again Student loans carried NerdWallet's quarter, but auto insurance revenue fell and the company missed its sales target. Revenue rose 11% to $240 million, below the range chief executive Tim Chen set three months ago. By our math, without student loans the rest of NerdWallet shrank slightly. Chen said the group was "overly optimistic on partnership timelines". • Revenue growth excluding student loans: −𝟬.𝟮% (by our math; reported revenue grew 11%) • Revenue: $𝟮𝟯𝟵.𝟲𝗠 (below its own $244–260M range) • Operating income, excluding one-offs: $𝟯𝟬.𝟰𝗠 ($26.5M on the old definition; range $29–37M) • Full-year profit outlook, excluding one-offs: 𝗖𝘂𝘁 $𝟵.𝟱𝗠 (middle of the range: $88M, 8% below 2025) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🔴 Bearish The story got worse because NerdWallet cut its full-year profit outlook again and expects fourth-quarter revenue to fall 13%. Paid marketing also grew faster than the revenue it bought, and profit stayed inside its range only after a change of definition. One positive: small-business revenue grew again after five declines. The question now is whether the extra marketing spend builds a business that pays back, or only replaces visitors Google no longer sends. If it does, revenue keeps growing in 2027. If not, the larger investment finance chief Jun Hyung Lee plans for next year deepens the profit decline. The next outlook will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢🟢 𝗦𝘁𝘂𝗱𝗲𝗻𝘁 𝗟𝗼𝗮𝗻𝘀 𝗔𝗱𝗱𝗲𝗱 $𝟮𝟱 𝗠𝗶𝗹𝗹𝗶𝗼𝗻 𝗼𝗳 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 NerdWallet runs a marketplace where students compare private loans, and in February it bought a second one, College Finance. Chief executive Tim Chen wrote that "new federal borrowing limits led more families to look at other financing options". The summer lending season added to that demand. Student loans made the largest move of any product line this quarter, and personal loans and deposit accounts grew too. The gain from deposits, however, has shrunk in each quarter of this year. • Student loans: +$25.0 million from a year ago, including the acquired marketplace • Personal loans: +$13.3 million, as NerdWallet added lenders to serve more borrowers • Deposit accounts: +$8.6 million, after +$20.9 million in the first quarter This matters because student loans now decide whether revenue grows. The quarterly filing says NerdWallet cannot measure how much of the gain came from the acquired marketplace. So readers cannot tell how much was bought and how much was earned. What to watch: student-loan revenue in the fourth quarter, when the summer season ends. A drop back toward last year's level would mean this quarter's growth was a one-off. 🟢 𝗕𝘂𝘆𝗯𝗮𝗰𝗸𝘀 𝗖𝘂𝘁 𝘁𝗵𝗲 𝗦𝗵𝗮𝗿𝗲 𝗖𝗼𝘂𝗻𝘁 𝟭𝟲% NerdWallet has put its cash into buying back its own shares, and the board added $100 million to the programme in February. Fewer shares means each remaining share gets a larger slice of profit, so the buyback supports profit per share even when total profit falls. The pace slowed this quarter, and finance chief Jun Hyung Lee said the group will keep weighing buybacks against investment and acquisitions. • Diluted shares: 64.7 million, down 16% from a year ago • Buyback this quarter: $10.5 million, after $89 million in the first half • Profit per share: down 32%, against net income down 43% What to watch: the fourth-quarter buyback against the $57 million left in the programme. The first-half pace would keep the share count falling at double-digit rates into 2027. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗔𝘂𝘁𝗼 𝗜𝗻𝘀𝘂𝗿𝗮𝗻𝗰𝗲 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗙𝗲𝗹𝗹 $𝟭𝟳 𝗠𝗶𝗹𝗹𝗶𝗼𝗻 NerdWallet earns insurance revenue by sending shoppers to carriers that pay for the lead. Auto insurers are spending to win customers this year, which should help a comparison site. Chief executive Tim Chen wrote that the group is "disappointed by our underperformance in auto insurance, especially given the tailwinds the overall industry is experiencing". Auto insurance revenue dropped $17.4 million from a year ago on lower lead volume. That alone pushed revenue below the range Chen set three months ago. He said "our partner network is too narrow". NerdWallet deals directly with only a few large carriers, and the rest got far more competitive this year. This matters because insurance was NerdWallet's largest product line when it last reported one, and the decline is not ending. Carriers "do not really want to work with you until you are at a certain volume", Chen said. He added that "we do not expect to resolve the problem in Q4". What to watch: whether Chen names a new carrier partnership with the next results. He said "it will be pretty obvious when that happens", so silence would mean the shortfall runs into 2027. 🔴🔴 𝗔 𝗗𝗲𝗳𝗶𝗻𝗶𝘁𝗶𝗼𝗻 𝗖𝗵𝗮𝗻𝗴𝗲 𝗞𝗲𝗽𝘁 𝗣𝗿𝗼𝗳𝗶𝘁 𝗜𝗻𝘀𝗶𝗱𝗲 𝗜𝘁𝘀 𝗥𝗮𝗻𝗴𝗲 NerdWallet's main profit measure is operating income excluding one-offs, which strips out depreciation, acquisition costs and restructuring. From this quarter it also strips out stock-based pay that vests early when staff leave. Chen said the figure came in at the low end of the range given three months ago. That is true only under the new definition. The change added back $3.9 million tied to two departing employees from an earlier acquisition. Without it, by our math, the figure was $26.5 million, below the range's $29 million floor. The underlying cause is cost, not the definition. Sales and marketing, mostly the online advertising that brings in visitors, took a far larger share of each revenue dollar. Every other cost line shrank as a share of revenue. • Sales and marketing: 72.3% of revenue, up 9.4 points from a year ago • Operating income margin excluding one-offs: 12.7%, down 6.5 points • Every other cost line combined: 19.6% of revenue, down 1.5 points What to watch: the fourth-quarter figure against the $9–15 million range, and whether new add-backs appear. A clean figure inside the range would show the change was a one-off. 🔴🔴 𝗠𝗮𝗿𝗸𝗲𝘁𝗶𝗻𝗴 𝗦𝗽𝗲𝗻𝗱 𝗥𝗼𝘀𝗲 𝗙𝗮𝘀𝘁𝗲𝗿 𝗧𝗵𝗮𝗻 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 NerdWallet once got much of its traffic free from Google. Chen said "organic search has become a fraction of what it was for us after 3.5 years of rapid declines". He added that "the pace of declines has stabilized a bit". To replace those visitors, the company buys traffic through paid search and social advertising, which it calls performance marketing. Performance marketing cost $139.9 million this quarter, $35.1 million more than a year ago. Revenue rose by $24.5 million. So each extra advertising dollar brought in about 70 cents of extra revenue, by our math, before any other cost. Finance chief Jun Hyung Lee said part of the year's $15–20 million long-payback investment "is also flowing there", which makes the spend look less efficient. That money funds in-house agents and brokers whose returns arrive after this year. But NerdWallet discloses no payback period or revenue for it, and no figure for visitors arriving from AI chat tools. What to watch: performance marketing against revenue in the fourth quarter, when the outlook has sales falling. If advertising drops less than revenue, the paid channel is buying sales that do not repeat. 🔴 𝗦𝗺𝗮𝗹𝗹-𝗕𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗚𝗿𝗼𝘄𝘁𝗵 𝗥𝗲𝘀𝘁𝘀 𝗼𝗻 𝗟𝗼𝗮𝗻𝘀 𝗔𝗹𝗼𝗻𝗲 NerdWallet's small-business segment sells loans and other products to small firms. It shrank for more than a year as Google sent fewer visitors, but this quarter it grew 6% after five straight declines. The gain came from NerdWallet's own loan-brokering arm. Chen wrote that this business "is performing well as we reconnect with past customers and improve sales execution". Search traffic losses kept pulling the other products down. One quarter does not end the concern: the non-loan products still shrink, and a year ago this segment fell 15%. Loans can carry the total only while originations rise faster than the rest declines. What to watch: the fourth-quarter small-business figure against $22.5 million a year ago. A second quarter of growth would turn a one-off into a trend. 🔴🔴 𝗟𝗮𝘁𝗲𝗿 𝗦𝘂𝗽𝗽𝗹𝗶𝗲𝗿 𝗣𝗮𝘆𝗺𝗲𝗻𝘁𝘀 𝗪𝗶𝗹𝗹 𝗙𝗹𝗮𝘁𝘁𝗲𝗿 𝗖𝗮𝘀𝗵 𝗙𝗹𝗼𝘄 NerdWallet's cash measure is adjusted free cash flow: operating cash flow less software and equipment spending. Its shareholder letter says "Our balance sheet and liquidity position remain strong". Over twelve months it reached $129.1 million, up by about half. Yet cash ended the quarter at $73.5 million, down 39%, because buybacks outran cash generation. Two items will flatter coming cash figures. NerdWallet negotiated "extended payment terms with certain vendors", which it expects to add roughly $50–60 million to operating cash flow over two quarters. The filing calls this "the timing of cash payments only"; the terms "may be revised or revoked at any time". NerdWallet also pays almost no federal cash tax, because it carries a deferred tax asset, which offsets tax it would otherwise owe. That asset fell to $17.6 million from $20.9 million in June. Lee said three months ago that normal taxes resume in mid-2027, so cash flow steps down by the tax bill from then. What to watch: fourth-quarter operating cash flow with and without the supplier-terms effect. A rise of only that amount would mean the business generated no more cash than a year ago. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗡𝗲𝗿𝗱𝗪𝗮𝗹𝗹𝗲𝘁 𝗪𝗮𝗻𝘁𝘀 𝗜𝘁𝘀 𝗔𝗴𝗲𝗻𝘁𝘀 𝗜𝗻𝘀𝗶𝗱𝗲 𝗔𝗜 𝗔𝘀𝘀𝗶𝘀𝘁𝗮𝗻𝘁𝘀 NerdWallet employs licensed insurance agents and loan brokers. Chen wrote that it is "exploring ways for our licensed agents to support consumers shopping through AI assistants". Its future in auto insurance depends on "whether carriers play ball", he said. Carriers fear shoppers who re-shop every six months and the cost of quotes that never become customers. No revenue comes from this yet. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗖𝗼𝘀𝘁 𝗼𝗳 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗮𝘀 𝘀𝗵𝗮𝗿𝗲 𝗼𝗳 𝘀𝗮𝗹𝗲𝘀 (𝟮𝟲𝗤𝟯): 𝟱.𝟴% ⇘ decelerating Cost of revenue fell to 5.8% of sales from 7.1% a year ago, the lowest share in five quarters. NerdWallet said lower amortization of capitalized software drove the drop, so it reflects earlier spending choices rather than a cheaper way of running the site. 𝗔𝗰𝗰𝗼𝘂𝗻𝘁𝘀 𝗿𝗲𝗰𝗲𝗶𝘃𝗮𝗯𝗹𝗲 (𝟮𝟲𝗤𝟯): $𝟭𝟮𝟯.𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable Receivables, the money partners owe for leads already delivered, barely moved from a year ago while revenue grew 11%. So partners are not paying more slowly. The balance did climb from $111.0 million in December, in step with the usual third-quarter rise in sales. 𝗥𝗲𝘀𝗲𝗮𝗿𝗰𝗵 𝗮𝗻𝗱 𝗱𝗲𝘃𝗲𝗹𝗼𝗽𝗺𝗲𝗻𝘁 (𝟮𝟲𝗤𝟯): $𝟭𝟳.𝟴 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable Research and development spending rose 13% from a year ago but stayed near 7% of revenue. Part of the rise is accounting: NerdWallet capitalized less software this year, so more engineering pay runs through this line instead of the balance sheet. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗤𝟰 𝗿𝗲𝘃𝗲𝗻𝘂𝗲: $𝟭𝟵𝟭–𝟮𝟬𝟯 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating New. The plan has fourth-quarter revenue falling 13% from a year ago at the middle of the range. That would be the first decline in at least five quarters. By our math the full year then lands near $856 million, a gain of about 2%. The comparison is hard: the same quarter a year ago grew 23%, and Chen expects the auto insurance shortfall to continue. 𝗤𝟰 𝗚𝗔𝗔𝗣 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗶𝗻𝗰𝗼𝗺𝗲: $𝟮–𝟴 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating New. At the middle of the range, GAAP operating income would be about a quarter of the $19.4 million NerdWallet earned a year ago. Most of the gap to the figure excluding one-offs is depreciation and amortization, which the company puts at $9–10 million. 𝗤𝟰 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗶𝗻𝗰𝗼𝗺𝗲 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: $𝟵–𝟭𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating New. The middle of the range is about half of what NerdWallet earned in the same quarter last year. By our math, the full-year plan given three months ago left room for $7–30 million here, so the new range sits in its lower half. Lee's planned investments in in-house agents and AI add cost before they add revenue. 𝗤𝟰 𝗮𝗱𝗷𝘂𝘀𝘁𝗲𝗱 𝗘𝗕𝗜𝗧𝗗𝗔: $𝟭𝟵–𝟮𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating New. Adjusted EBITDA is operating profit before depreciation and all stock-based pay. The range means a margin near 11% at the middle, the lowest on the chart, against 16% a year ago. The difference from operating income excluding one-offs is the equity pay this measure adds back. 𝗙𝗬𝟮𝟬𝟮𝟲 𝗚𝗔𝗔𝗣 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗶𝗻𝗰𝗼𝗺𝗲: $𝟱𝟲–𝟲𝟮 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating 🠇 cut from $65–80 million Cut. The middle of the range fell $13.5 million to $59 million. That is about 10% below last year's operating income. Third reduction this year, and each is larger than the last: the first two took $3 million and $5 million off the midpoint. The year will now end well below the plan NerdWallet set at the start of it. 𝗙𝗬𝟮𝟬𝟮𝟲 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗶𝗻𝗰𝗼𝗺𝗲 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: $𝟴𝟱–𝟵𝟭 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating 🠇 cut from $90–105 million Cut. The middle of the range is now $88 million, $9.5 million below what NerdWallet confirmed three months ago. That is about 8% below last year's figure. Chen wrote that the plan still carries the $15–20 million cost of the long-payback investments. So the cut comes from the auto insurance shortfall rather than extra spending. The midpoint fell after the first quarter, held after the second and drops again now. 𝗙𝗬𝟮𝟬𝟮𝟲 𝗮𝗱𝗷𝘂𝘀𝘁𝗲𝗱 𝗘𝗕𝗜𝗧𝗗𝗔: $𝟭𝟮𝟳–𝟭𝟯𝟯 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating 🠇 cut from $131–147 million Cut. The middle of the range fell $9 million to $130 million. This is the third cut in a row. That leaves the year about 10% below last year's result. The whole range now sits below the $140 million minimum that NerdWallet set for this year in early 2025. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗪𝗵𝗮𝘁 𝗱𝗼𝗲𝘀 𝘁𝗵𝗲 𝗹𝗼𝗻𝗴-𝗽𝗮𝘆𝗯𝗮𝗰𝗸 𝗶𝗻𝘃𝗲𝘀𝘁𝗺𝗲𝗻𝘁 𝗲𝗮𝗿𝗻? NerdWallet is spending $15–20 million this year on in-house agents and brokers with returns after this year, and plans more next year. It has never given a payback period, retained-customer count or revenue figure for that money. 𝗛𝗼𝘄 𝗯𝗶𝗴 𝗶𝘀 𝗶𝗻𝘀𝘂𝗿𝗮𝗻𝗰𝗲 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗻𝗼𝘄? Insurance was the largest product line when NerdWallet last reported one. Since the reporting change, readers see only the auto insurance decline, not the base it came from or whether life and pet insurance grew. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗼𝗳 𝘁𝗵𝗲 𝘀𝘁𝘂𝗱𝗲𝗻𝘁-𝗹𝗼𝗮𝗻 𝗴𝗮𝗶𝗻 𝗿𝗲𝗽𝗲𝗮𝘁𝘀 𝗻𝗲𝘅𝘁 𝘆𝗲𝗮𝗿? The quarterly filing says NerdWallet cannot separate the acquired marketplace's contribution from the rest. Without that split, and with the summer season over, readers cannot tell whether the student-loan gain is a new business or a one-off. 𝗪𝗵𝘆 𝗱𝗶𝗱 𝘁𝗵𝗲 𝗰𝗼𝗻𝘁𝗿𝗮𝗰𝘁 𝗮𝘀𝘀𝗲𝘁 𝗷𝘂𝗺𝗽 𝘁𝗼 $𝟭𝟱.𝟳 𝗺𝗶𝗹𝗹𝗶𝗼𝗻? The balance sheet carries $15.7 million of estimated variable consideration, revenue booked before partners confirm the amount, up from $3.5 million in December. A larger estimate means more of this year's revenue rests on judgement about what partners will pay. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗺𝗼𝗿𝗲 𝘄𝗶𝗹𝗹 𝗡𝗲𝗿𝗱𝗪𝗮𝗹𝗹𝗲𝘁 𝘀𝗽𝗲𝗻𝗱 𝗶𝗻 𝟮𝟬𝟮𝟳? Lee said the group will "increase our investments in longer payback vertical integration and AI related projects next year". He said this will reduce operating income excluding one-offs near term, but gave no amount or payback target.

$MNST Q3 2026 earnings: Monster sells 17% more, but its profit rises only 8% Monster is selling far more energy drinks abroad, but its costs are climbing even quicker than its sales. Sales rose 17% to $2.56 billion, matching last year's pace against a much harder comparison, with international markets now almost half the business. Operating profit rose only 6%, because aluminum, freight, marketing and a property write-down all outpaced revenue. • Net sales: $𝟮.𝟱𝟲𝗕 (+16.7% from a year ago) • Operating margin: 𝟮𝟴.𝟬% (30.7% a year ago) • Sales outside the US: 𝟰𝟳% 𝗼𝗳 𝘁𝗼𝘁𝗮𝗹 (43% a year ago) • October sales growth: +𝟭𝟭.𝟭% (+16.7% in the third quarter; one fewer selling day) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🔴 Bearish The story got worse because the cost squeeze widened: the operating margin lost 2.7 points, after 0.7 last quarter. The good news: sales growth held its pace against a tough comparison, and the US category started growing again. One caution: Monster's own US sales trailed that category, and October slowed further. The question now is whether the November US price increase can restore the margin before aluminum costs climb again. If shoppers accept it, as Schlosberg anticipates, gross margin recovers; if they resist, Monster keeps its growth abroad at a thinner margin. The fourth-quarter gross margin and January sales update will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢🟢 𝗜𝗻𝘁𝗲𝗿𝗻𝗮𝘁𝗶𝗼𝗻𝗮𝗹 𝘀𝗮𝗹𝗲𝘀 𝗴𝗿𝗼𝘄 𝟮𝟴%, 𝗻𝗲𝗮𝗿 𝗵𝗮𝗹𝗳 𝗼𝗳 𝘁𝗼𝘁𝗮𝗹 Monster sells its energy drinks in 160 countries through Coca-Cola's bottlers, and the business outside the United States is where it grows fastest. Chief executive Hilton Schlosberg credited share gains "in many of our global markets". Sales abroad rose 28% to $1.2 billion, almost half the total. • Latin America and the Caribbean: +48.8% in dollars, led by Brazil • EMEA (Europe, Middle East and Africa): +24.9%, with share leadership gained in Great Britain, Egypt and Serbia • Asia Pacific: +12.3%; China +43.8%, India +67.2%, Japan down 2.0% in dollars • International operating income: $268.9 million, +27.8% Schlosberg's reply to the margin question is "we bank dollars, we do not bank percentages", and the figures back him. International operating income grew almost as fast as international sales, and gross margin rose in all three regions abroad. So the group's lower gross margin comes from the mix of countries, not from weaker pricing in them. What to watch: the international share of sales in the fourth quarter, due in February. A share above 47% would mean the mix drag on the group gross margin keeps widening while profit dollars abroad keep rising. 🟢 𝗭𝗲𝗿𝗼-𝘀𝘂𝗴𝗮𝗿 𝗨𝗹𝘁𝗿𝗮 𝗼𝘂𝘁𝗴𝗿𝗼𝘄𝘀 𝘁𝗵𝗲 𝗰𝗮𝘁𝗲𝗴𝗼𝗿𝘆 𝗲𝘃𝗲𝗿𝘆𝘄𝗵𝗲𝗿𝗲 Monster Ultra is the company's family of zero-sugar energy drinks, and Schlosberg called the sugar-free range "a significant contributor to U.S. growth". Nielsen data he cited shows Ultra up 19% in US dollar sales, and in Europe the Ultra family rose 42%. Guy Carling, chief executive of EMEA, said Monster now holds a 46.0% value share of Europe's zero-sugar segment, up from 44.5% last quarter. This matters because zero-sugar drinks carry higher margins than full-sugar ones, Schlosberg said. Yet the group gross margin still fell 1.1 points, so the product benefit did not outweigh aluminum and geography. What to watch: Monster's zero-sugar value share in Europe next quarter. A move above 46% would show Ultra still taking share from rivals, which keeps international margins rising. 🟢 𝗖𝗼𝗰𝗮-𝗖𝗼𝗹𝗮 𝘀𝘆𝘀𝘁𝗲𝗺 𝗼𝗽𝗲𝗻𝘀 𝗿𝗲𝘀𝘁𝗮𝘂𝗿𝗮𝗻𝘁𝘀 𝘁𝗼 𝗠𝗼𝗻𝘀𝘁𝗲𝗿 Monster depends on Coca-Cola's bottlers to reach stores, and Coca-Cola holds about a fifth of its votes, so that dependence is a standing risk. This quarter the tie produced new outlets in foodservice on-premise, or FSOP, Monster's term for restaurants and hotels serving drinks with food. Rob Gehring, chief executive of the Americas, named Carl's Jr. and Tim Hortons, after the Marriott deal through Coca-Cola; Subway and Wingstop joined in Europe. Gehring now moves to The Coca-Cola Company, a role Schlosberg believes will be "synergistic to both ourselves and The Coca-Cola Company". But no FSOP sales figure exists yet. What to watch: any FSOP sales or outlet count at the December 1 investor day. A figure would turn the restaurant push into a measurable source of growth. 🟢 𝗔𝗳𝗳𝗼𝗿𝗱𝗮𝗯𝗹𝗲 𝗙𝘂𝗿𝘆 𝗮𝗻𝗱 𝗕𝘂𝗿𝗻 𝗹𝗶𝗳𝘁 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝗶𝗰 𝗕𝗿𝗮𝗻𝗱𝘀 𝟮𝟬% Strategic Brands holds older brands bought from Coca-Cola in 2015, such as Burn and NOS, plus Predator and Fury, Monster's low-priced brands for developing markets. The segment has been a standing concern. This quarter it grew 19.8% to $156.4 million, the fastest of the four segments. The filing credits Burn and Fury, not NOS, and segment operating income rose 20.1%. This matters because concentrate keeps about 51 cents of operating profit per sales dollar, against 36 for the Monster segment. But concentrate sales swing with bottler schedules, the filing warns, and the segment grew 10.6% last quarter. What to watch: Strategic Brands growth in the fourth quarter against a soft 7.8% comparison. A third straight quarter above 15% would show the affordable brands, not bottler timing, drive the segment. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗠𝗼𝗻𝘀𝘁𝗲𝗿'𝘀 𝗨𝗦 𝘀𝗮𝗹𝗲𝘀 𝘁𝗿𝗮𝗶𝗹 𝘁𝗵𝗲 𝗨𝗦 𝗰𝗮𝘁𝗲𝗴𝗼𝗿𝘆 Schlosberg credited share gains "in many of our global markets" and said US "category data is actually starting accelerating". US store sales of energy drinks rose 12.4% in the latest Nielsen reading, up from 7.1% in August. Monster's own US sales did not keep pace: by our math they grew 8.2%, the widest shortfall in five quarters. • US sales growth, by our math: 8.2%, after 10.2% last quarter and 15.1% in the first • October company sales: +11.1%, the lowest first-month reading since January 2025, with one fewer selling day • US price increase: effective November 1; Schlosberg anticipates "minimal impact on volumes" Nielsen's period runs to late October, so the gap is indicative. Gehring saw "a little slowing at the end of the summer versus our traditional trends" and said recent weeks show over 15% growth. Bottlers, not shoppers, buy from Monster, so shipments can lag store sales. But October shows no catch-up, and from November Monster laps last year's US price increase. What to watch: the January sales update on the February call. A reading below October's 11% would mean the US business itself, not the comparison, is slowing. 🔴🔴 𝗖𝗼𝘀𝘁𝘀 𝗼𝘂𝘁𝗿𝘂𝗻 𝘀𝗮𝗹𝗲𝘀 𝗮𝗻𝗱 𝗰𝘂𝘁 𝗺𝗮𝗿𝗴𝗶𝗻 𝟮.𝟳 𝗽𝗼𝗶𝗻𝘁𝘀 Monster kept 28.0 cents of operating profit per dollar of sales, down from 30.7 cents. Sales climbed 17% but operating income only 6%, because every cost line outgrew revenue. The company calls the marketing deliberate, "to reach a broader consumer audience and increase household penetration". Schlosberg says "Gen Z household incidence is now at 58%". • Gross margin: 54.7%, down 1.1 points, on aluminum cans, country mix and freight-in costs • Distribution (freight, warehousing): 4.5% of sales, up 0.8 points • Selling (advertising, sponsorships): 10.1% of sales, up 0.4 points • General and administrative: 11.9% of sales, up 0.5 points, with a $19.9 million write-down • Core segment margin: 36.2%, down 2.8 points Without the write-down, operating income still rose only 9% on 17% more sales, by our math. Schlosberg said "raw aluminum has increased 36% since a year ago" and expects rising can costs "through at least the first quarter of 2027". That is a quarter beyond his earlier horizon; the November US price increase is the offset. What to watch: fourth-quarter operating margin against 29.0% a year ago, excluding that quarter's alcohol write-down. A lower margin means pricing has not caught up. 🔴 𝗥𝗶𝘀𝗸𝘀 𝘁𝗵𝗶𝘀 𝗾𝘂𝗮𝗿𝘁𝗲𝗿 𝗱𝗶𝗱𝗻'𝘁 𝗮𝗻𝘀𝘄𝗲𝗿 Five standing concerns received a sentence or nothing from Monster this quarter, and none got a number that settles it. • India regulation: regulator FSSAI ordered caffeinated drinks to drop the energy drink label; a Delhi court allowed existing stock to sell in October. The final ruling moves it. • Alcohol Brands: sales fell 13.6% and the operating loss halved to $9.0 million; no plan was announced. A stated exit or target moves it. • Argentina: sales fell 6.1% in dollars while rising 13.2% in pesos; currency, not demand, set the number. • Currency: exchange rates added $8.1 million to sales, against $48.5 million last quarter; the tailwind is almost gone. • Competition: no rival named and no US share figure given; Red Bull and Celsius pressure is not readable here. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗖𝗮𝘀𝗵 𝗿𝗲𝗮𝗰𝗵𝗲𝘀 $𝟰.𝟲 𝗯𝗶𝗹𝗹𝗶𝗼𝗻; 𝗯𝘂𝘆𝗯𝗮𝗰𝗸𝘀 𝗿𝗲𝘀𝘂𝗺𝗲 Monster holds $4.63 billion of cash and investments with no debt, up from $3.25 billion at year-end. It bought back 2.3 million shares for about $100 million, its first repurchase since the first quarter. Interest income rose to $41.3 million from $24.2 million, so by our math a third of pre-tax profit growth came from the cash pile. Schlosberg hosts an investor day on December 1. 𝗠𝗼𝗻𝘀𝘁𝗲𝗿 𝗽𝗹𝗮𝗻𝘀 𝗳𝗲𝘄𝗲𝗿 𝗹𝗮𝘂𝗻𝗰𝗵𝗲𝘀 𝗮𝗻𝗱 𝗮 𝗽𝗿𝗼𝘁𝗲𝗶𝗻 𝗱𝗿𝗶𝗻𝗸 "Maybe we had a little bit too much in 2026, but we regard 2027 innovation as quality over quantity," Schlosberg said of next year's launch calendar. Case sales still grew 18% this quarter, so the crowded calendar did not stop volume. Next year adds Monster Protein in March, in the "fast-growing ready-to-drink protein category", and a McLaren zero-sugar can in summer. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗜𝗻𝘃𝗲𝗻𝘁𝗼𝗿𝗶𝗲𝘀 (𝟮𝟲𝗤𝟯): $𝟵𝟮𝟬.𝟭 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Inventories rose 30.6% from a year ago, nearly twice the pace of sales. Finished goods did most of it, climbing to $577 million from $476 million at year-end. Stock now equals 35.9% of a quarter's sales, against 32.1% a year ago. Building it absorbed $127 million of cash this year. 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗰𝗮𝘀𝗵 𝗳𝗹𝗼𝘄, 𝗻𝗶𝗻𝗲 𝗺𝗼𝗻𝘁𝗵𝘀 (𝟮𝟲𝗤𝟯): $𝟭.𝟲𝟳 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Cash from operations fell 2.8% in the first nine months while net income rose 18%. Receivables absorbed $362 million and inventories $127 million. By our math, 97% of profit turned into cash, down from 118% a year ago. Capital spending is not in the filing excerpt, so free cash flow is not readable. 𝗗𝗶𝗹𝘂𝘁𝗲𝗱 𝘀𝗵𝗮𝗿𝗲 𝗰𝗼𝘂𝗻𝘁 (𝟮𝟲𝗤𝟯): 𝟭,𝟵𝟴𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable The share count rose 0.5% from a year ago despite $100 million of buybacks, because stock awards added more shares than Monster retired. Earnings per share therefore grew 7.8%, a little slower than net income at 8.4%. Figures are restated for the August two-for-one split. 𝗘𝗻𝗲𝗿𝗴𝘆 𝗱𝗿𝗶𝗻𝗸 𝗰𝗮𝘀𝗲 𝘀𝗮𝗹𝗲𝘀 (𝟮𝟲𝗤𝟯): 𝟯𝟬𝟰.𝟵 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝗰𝗮𝘀𝗲𝘀 ⇘ decelerating Volume did all the work: case sales rose 18.0% while the average price per case slipped 0.6%. Growth has eased from 28.8% in the first quarter and 22.3% in the second as the comparisons harden. Revenue per case has fallen from a year earlier for three quarters, because the fastest-growing international markets carry lower prices. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗲𝘅𝗽𝗲𝗻𝗱𝗶𝘁𝘂𝗿𝗲𝘀, 𝘁𝘄𝗲𝗹𝘃𝗲 𝗺𝗼𝗻𝘁𝗵𝘀 𝘁𝗼 𝗦𝗲𝗽𝘁𝗲𝗺𝗯𝗲𝗿 𝟯𝟬, 𝟮𝟬𝟮𝟳: 𝗟𝗲𝘀𝘀 𝘁𝗵𝗮𝗻 $𝟮𝟱𝟬.𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable 🠆 unchanged from Less than $250.0 million through June 30, 2027 Unchanged. The company again put capital spending at "likely to be less than $250.0 million", now through September 2027, the same ceiling rolled forward one quarter. Operating cash reached $1.67 billion in nine months, so the ceiling leaves most of it for investments and buybacks. 𝗔𝗹𝘂𝗺𝗶𝗻𝘂𝗺 𝗰𝗮𝗻 𝗰𝗼𝘀𝘁𝘀: 𝗠𝗼𝗱𝗲𝘀𝘁 𝘀𝗲𝗾𝘂𝗲𝗻𝘁𝗶𝗮𝗹 𝗶𝗻𝗰𝗿𝗲𝗮𝘀𝗲 𝘁𝗵𝗿𝗼𝘂𝗴𝗵 𝗮𝘁 𝗹𝗲𝗮𝘀𝘁 𝘁𝗵𝗲 𝗳𝗶𝗿𝘀𝘁 𝗾𝘂𝗮𝗿𝘁𝗲𝗿 𝗼𝗳 𝟮𝟬𝟮𝟳 ⇒ stable 🠅 raised from Modest sequential increase through the end of 2026 Extended. Schlosberg now expects aluminum costs to rise a little each quarter "through at least the first quarter of 2027". That is one quarter longer than the end-2026 horizon he gave on the previous three calls. Raw aluminum is up 36% from a year ago, he said, and the Midwest Premium, the US delivery surcharge, carries the tariff. Hedging and the November US price increase are the offsets he named. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗜𝘀 𝗠𝗼𝗻𝘀𝘁𝗲𝗿 𝗹𝗼𝘀𝗶𝗻𝗴 𝗨𝗦 𝘀𝗵𝗮𝗿𝗲, 𝗼𝗿 𝗮𝗿𝗲 𝗯𝗼𝘁𝘁𝗹𝗲𝗿𝘀 𝗱𝗲𝘀𝘁𝗼𝗰𝗸𝗶𝗻𝗴? US sales grew 8% by our math while Nielsen's category grew 12%. Management credited share gains abroad but gave no US share figure, and the gap decides whether the US slowdown is timing or demand. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝘄𝗶𝗹𝗹 𝘁𝗵𝗲 𝗡𝗼𝘃𝗲𝗺𝗯𝗲𝗿 𝗽𝗿𝗶𝗰𝗲 𝗶𝗻𝗰𝗿𝗲𝗮𝘀𝗲 𝗮𝗱𝗱? Monster gave no size by package or channel. The increase is the only named offset to aluminum costs rising into 2027, so its size decides whether gross margin recovers next year. 𝗜𝘀 𝗺𝗮𝗿𝗸𝗲𝘁𝗶𝗻𝗴 𝗮𝘁 𝟭𝟬% 𝗼𝗳 𝘀𝗮𝗹𝗲𝘀 𝘁𝗵𝗲 𝗻𝗲𝘄 𝗹𝗲𝘃𝗲𝗹? Selling expense has topped 10% of sales in two of the last three quarters, and sponsorship and marketing commitments stand at $738 million. The August question on whether per-case spend is a run rate went unanswered again. 𝗪𝗵𝗮𝘁 𝘄𝗶𝗹𝗹 𝘁𝗵𝗲 𝗶𝗻𝘃𝗲𝘀𝘁𝗼𝗿 𝗱𝗮𝘆 𝘀𝗮𝘆 𝗮𝗯𝗼𝘂𝘁 𝘁𝗵𝗲 𝗰𝗮𝘀𝗵? Cash and investments rose $1.4 billion this year while buybacks totalled $200 million. No dividend, target or framework exists, and the December 1 meeting is the first chance to set one. 𝗪𝗵𝗼 𝗿𝘂𝗻𝘀 𝘁𝗵𝗲 𝗔𝗺𝗲𝗿𝗶𝗰𝗮𝘀 𝗮𝗳𝘁𝗲𝗿 𝗥𝗼𝗯 𝗚𝗲𝗵𝗿𝗶𝗻𝗴 𝗹𝗲𝗮𝘃𝗲𝘀? Gehring, chief executive of the Americas, joins The Coca-Cola Company after this call. No successor was named, and the US business is the one growing slowest and about to take a price increase.

$NET Q3 2026 earnings: Cloudflare sales accelerate, but serving its customers costs more Cloudflare is growing faster than it has in nearly four years, but each sale costs more to serve. Revenue rose 39% to $782.5 million, above the middle of its own target by 6%, the widest gap in at least a year. Chief executive Matthew Prince called it the company's best quarter ever, and finance chief Thomas Seifert raised the full-year plan by far more than in the two earlier raises this year. • Revenue: $𝟳𝟴𝟮.𝟱𝗠 (+39% from a year ago) • Profit per share, excluding one-offs: $𝟬.𝟯𝟴 ($0.27 a year ago) • Gross margin, excluding one-offs: 𝟳𝟮.𝟰% (75.3% a year ago) • Full-year revenue outlook: 𝗥𝗮𝗶𝘀𝗲𝗱 $𝟵𝟲.𝟱𝗠 (middle of the range: 37% growth) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🟢 Bullish The story got better because Cloudflare raised its outlook by much more than its usual pattern and now expects a profit under standard accounting rules in the fourth quarter, well ahead of its old target. The bad news: gross margin slipped to 72.4%, below the level Seifert said in August would hold, and free cash flow fell to 10% of revenue as spending on servers rose. The question now is whether the usage-based revenue that drove the beat keeps coming. Either customers keep using up their prepaid contracts early and renewing larger, so growth holds near 38%, or usage settles and growth falls back toward the slower pace of the contracted backlog. Next quarter's backlog growth set against revenue growth will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢🟢 𝗖𝗹𝗼𝘂𝗱𝗳𝗹𝗮𝗿𝗲 𝗕𝗲𝗮𝘁 𝗜𝘁𝘀 𝗢𝘄𝗻 𝗣𝗹𝗮𝗻 𝗯𝘆 𝘁𝗵𝗲 𝗪𝗶𝗱𝗲𝘀𝘁 𝗚𝗮𝗽 𝗬𝗲𝘁 Cloudflare sets a revenue target each quarter and has beaten the middle of it every time in the past year. The gap had never exceeded 5%. This quarter it reached 6.3%, so the pattern changed rather than repeated. Chief executive Matthew Prince said: "By nearly every metric, we had our best quarter ever." The network company then lifted its full-year target by about $97 million, the third raise this year and by far the largest. Finance chief Thomas Seifert expects fourth-quarter revenue of about $845 million. By our math that is 38% growth, just below this quarter's 39%. • Revenue: $782.5 million, 39% above a year ago • Beat against the middle of the range: 6.3%, after 4.3%, 3.1% and 4.8% in the prior three quarters • Full-year revenue outlook: $2,963–2,964 million, up from $2,864–2,870 million • Annualized revenue: above $3 billion, a mark Cloudflare had set for the fourth quarter This matters because a target the company beats by a fixed amount tells investors little, but a beat outside the usual band means demand moved faster than Seifert's own model. He said the upside came from a long tail of customers rather than a few large deals, and that breadth shaped how he set the fourth-quarter plan. What to watch: fourth-quarter revenue against the $845 million plan, due in February. If the pattern of the past year holds, by our math revenue would land near $880 million, or 43% growth, and that would show demand still running ahead of what Seifert can see. 🟢🟢 𝗪𝗼𝗿𝗸𝗲𝗿𝘀 𝗜𝘀 𝗡𝗼𝘄 𝗶𝗻 𝗡𝗲𝗮𝗿𝗹𝘆 𝗘𝘃𝗲𝗿𝘆 𝗕𝗶𝗴 𝗖𝗼𝗻𝘁𝗿𝗮𝗰𝘁 Workers is Cloudflare's developer platform, the tools programmers use to run code and AI agents on its network without renting servers. Prince calls the company "the first agentic cloud", and he said that in "almost every pool of funds deal that we sell, Workers is a big component of it". A pool of funds deal lets a customer prepay a sum and spend it on any product. This quarter the platform passed 10 million active developers, up from 7 million three months earlier, Prince said. An AI company signed an $11 million one-year Workers contract. The biggest spenders expanded fastest, so net retention, revenue from last year's customers compared with a year ago, rose to 122% from 120%. • Net retention: 122%, up from 120% last quarter and 119% a year ago • Customers paying over $5 million a year: nearly as many added in nine months as existed at the end of 2025, Seifert said • Revenue sold through resellers and partners: $247 million, up 65% from a year ago, 32% of the total • Act 4, Cloudflare's products for charging AI companies that read websites: Prince reported "our first revenue for what we've called Act 4 products", amount not disclosed The platform matters beyond its own sales, because Seifert said Workers carries a lower gross margin but a much lower cost of selling, and he credits it for this quarter's operating margin. Customers also use up prepaid funds faster once their developers find Workers, so they renew earlier and larger, which is what lifted retention. What to watch: net retention next quarter. Seifert said it can keep rising; a reading above 122% would show prepaid customers still expanding faster than they use up their contracts. 🟢 𝗦𝗲𝗰𝘂𝗿𝗶𝘁𝘆 𝗦𝗰𝗮𝗿𝗲𝘀 𝗕𝗿𝗶𝗻𝗴 𝗜𝗻 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝗕𝗲𝘆𝗼𝗻𝗱 𝗔𝗜 A wave of newly found software flaws is pushing companies of all kinds to put Cloudflare in front of their websites. Prince said researchers now disclose bugs to Cloudflare before they are public, so it can protect customers early, and that "right now what CISOs are doing is panic". The result showed in sign-ups. Cloudflare added more than 158,000 paying customers in the quarter, nearly double its previous record, and Prince said that since July it "added approximately 5% of the entire web to Cloudflare". A U.S. federal department signed a five-year, $10.3 million contract for its Zero Trust tools, which check every user before granting access. This matters because it widens the base beyond AI companies, which Prince named as the other growth driver. Banks, governments and manufacturers were buying, he said, so growth does not rest on a few AI firms using up prepaid contracts. One caution: the network company no longer reports total paying customers, so the size of the base those sign-ups join is not readable. What to watch: fourth-quarter additions of paying customers, which Prince now discloses on the call. Another quarter above 100,000 would mean the security demand is lasting rather than a reaction to one month of disclosures. concern eased — 𝗧𝗵𝗲 𝗟𝗮𝘆𝗼𝗳𝗳𝘀 𝗗𝗶𝗱 𝗡𝗼𝘁 𝗦𝗹𝗼𝘄 𝗦𝗮𝗹𝗲𝘀 In May Cloudflare cut about 20% of its staff, and the worry was that fewer people would mean slower selling while demand ran hot. This quarter was the first full one after the cuts. The plan's charges totalled $161.7 million, within the $165 million cap, and Seifert said it was substantially complete by September. Sales did not slow. Prince said sales productivity "reached a new record in the third quarter" and rose for an eleventh straight quarter, while operating costs excluding one-offs fell to 55% of revenue from 60% a year ago. • Sales and marketing: 34.5% of revenue, down 1.3 percentage points • Research and development: 13.0% of revenue, down 1.7 points • General and administrative: 7.4% of revenue, down 2.2 points The reading is not this quarter alone. Seifert set the fourth-quarter operating margin at 18.5% by our math, so the plan he made knowing the pipeline also says the sales engine kept running. That is why the concern can be set aside, though a new head of sales has just arrived. What to watch: fourth-quarter operating margin against the 18.5% plan. Hitting it with revenue still growing near 38% would confirm the cuts removed cost without removing selling capacity. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗚𝗿𝗼𝘀𝘀 𝗠𝗮𝗿𝗴𝗶𝗻 𝗙𝗲𝗹𝗹 𝗕𝗲𝗹𝗼𝘄 𝘁𝗵𝗲 𝗟𝗲𝘃𝗲𝗹 𝗦𝗲𝗶𝗳𝗲𝗿𝘁 𝗦𝗮𝗶𝗱 𝗪𝗼𝘂𝗹𝗱 𝗛𝗼𝗹𝗱 Gross margin is what Cloudflare keeps from each dollar of sales after paying to run its network. In August Seifert said it would settle around the second-quarter level of 73.1%. It came in at 72.4% instead, 2.9 points below a year ago, though he noted it stays "within our target long-term range of 70%-77%". The cause is in the filing rather than on the call. The cost of serving customers rose 54% while revenue rose 39%, and the largest piece was $43.0 million more in "third-party technology services costs", a line management has not explained on any call. • Cost of revenue excluding one-offs: 27.6% of revenue, up 2.9 points from a year ago • Spending on servers and software: $133 million, 17% of revenue, up from 16% • Free cash flow: $82 million, 10% of revenue, down from 13% • Signed in October: "several large compute and co-location agreements" worth $461 million over three to ten years This matters because Seifert points investors to unit economics below the gross margin line, a figure the company does not publish, while the figure it does publish keeps falling. Operating margin rose because selling and overhead costs fell as a share of revenue, not because serving customers got cheaper. What to watch: gross margin excluding one-offs in the fourth quarter. The October contracts add fixed cost, so a reading below 72% would mean the AI workloads driving growth cost more to serve than the products they sit beside. 🔴🔴 𝗨𝘀𝗮𝗴𝗲 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗗𝗿𝗼𝘃𝗲 𝘁𝗵𝗲 𝗕𝗲𝗮𝘁, 𝗮𝗻𝗱 𝗨𝘀𝗮𝗴𝗲 𝗖𝗮𝗻 𝗦𝘄𝗶𝗻𝗴 Much of Cloudflare's revenue comes from pool of funds contracts, where a customer prepays and draws the money down on any product, and from pay-as-you-go usage. Seifert said variable revenue "was the primary contributor to the upside", as customers were "burning through their pool of funds commitments faster" and renewing early. The contracted backlog tells a different story from the revenue line. Remaining performance obligations, the revenue Cloudflare has signed but not yet delivered, grew 34% from a year ago, the slowest in at least six quarters. By our math the quarter added $145 million to that backlog, against $166 million a year earlier. This cuts both ways, because what customers consume early they do not consume later, and Seifert said in August that revenue per customer now varies more. Cloudflare also does not disclose Workers revenue, so investors cannot see how much of the quarter came from usage that could fall back. The counterweight is deferred revenue, cash collected for service not yet delivered, which grew faster than revenue. What to watch: total backlog growth next quarter. If it falls below 30% while revenue grows near 38%, the gap would mean growth is drawing on usage faster than new contracts replace it. 🔴 𝗛𝗲𝗮𝗱𝗰𝗼𝘂𝗻𝘁 𝗜𝘀 𝗙𝗹𝗮𝘁 𝗗𝗲𝘀𝗽𝗶𝘁𝗲 𝘁𝗵𝗲 𝗛𝗶𝗿𝗶𝗻𝗴 𝗖𝗹𝗮𝗶𝗺 Prince told investors Cloudflare is "hiring like crazy" and added: "I think our headcount's going to be larger by the end of the year than it was even before the layoffs." The numbers do not yet show it. Headcount was 4,707 at quarter end, 7 more than in June. That leaves it 776 below the March level, before the cuts. The filing adds detail: sales and marketing staff rose 2% from a year ago, while general and administrative staff fell 14%. So the operating margin gain came partly from running the company with fewer people, which is the point of the plan, but the hiring Prince describes has not yet reached the headcount line. What to watch: headcount at year end, due in February. Passing 5,483 would need about 780 hires in one quarter; a number far short of that would mean the margin came from restraint that Prince himself does not plan to keep. 🔴 𝗦𝘁𝗼𝗰𝗸 𝗣𝗮𝘆 𝗥𝗶𝘀𝗲𝘀 𝗙𝗮𝘀𝘁𝗲𝗿 𝗧𝗵𝗮𝗻 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 Cloudflare pays much of its staff in shares, and that cost is left out of the profit figures management highlights. Stock compensation and related taxes reached $174 million this quarter. That is 22% of revenue, and it rose 45% from a year ago, faster than sales, so the reported loss widened. • Reported net loss: $34.1 million, including $11.0 million of restructuring and $10.7 million of legal reserves • Interest on $5.1 billion of cash: $45 million, about a quarter of profit excluding one-offs after tax, by our math • New convertible bond: $2.5 billion at 0% interest, converting at $496.94 a share; the 2026 bonds settled with 2.2 million new shares, less 1.4 million returned under the hedge The counterweight is Seifert's plan to "achieve GAAP profitability in the fourth quarter", ahead of the previous target of 2028 at the latest. This quarter's loss excluding the restructuring and legal items was about $12 million by our math, so one more quarter of growth could close that gap, though the stock cost itself keeps growing. What to watch: reported net income in the fourth quarter. A profit would be the first quarter in which revenue growth outran stock pay enough to cover it; a loss would mean the 2028 date is still the real one. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗔 𝗡𝗲𝘄 𝗦𝗮𝗹𝗲𝘀 𝗖𝗵𝗶𝗲𝗳 𝗧𝗮𝗸𝗲𝘀 𝗢𝘃𝗲𝗿 𝗙𝗿𝗼𝗺 𝗠𝗮𝗿𝗸 𝗔𝗻𝗱𝗲𝗿𝘀𝗼𝗻 Mark Anderson, who led the rebuild of Cloudflare's sales organisation over three years, retires at year end and stays on as an adviser for at least a year. Christian Smith joined as President of Revenue and said his first priority is to "double down on go-to-market execution". The first quarter booked under his own plan is the fourth, so the first reading on the change arrives in February. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝗽𝗮𝘆𝗶𝗻𝗴 𝗼𝘃𝗲𝗿 $𝟭𝟬𝟬,𝟬𝟬𝟬 𝗮 𝘆𝗲𝗮𝗿 (𝟮𝟲𝗤𝟯): 𝟱,𝟬𝟬𝟲 ⇗ accelerating Up 25% from a year ago, with 308 added in the quarter, the most in any quarter. Growth has held in the mid-20s for six quarters. These accounts now bring in 75% of revenue, up from 73% a year ago, so Cloudflare's growth rests a little more each quarter on large customers. 𝗗𝗲𝗳𝗲𝗿𝗿𝗲𝗱 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 (𝟮𝟲𝗤𝟯): $𝟵𝟭𝟲 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Still growing faster than sales: up 42% from a year ago against revenue up 39%. Deferred revenue is cash customers have paid for service not yet delivered, so it tends to lead reported revenue. The gap has narrowed each quarter this year, from about 15 points in March to 3 points now, as more revenue is billed as usage happens. 𝗖𝗮𝘀𝗵 𝗮𝗻𝗱 𝗰𝗼𝗻𝘃𝗲𝗿𝘁𝗶𝗯𝗹𝗲 𝗱𝗲𝗯𝘁 (𝟮𝟲𝗤𝟯): $𝟱.𝟭𝟯 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 𝗰𝗮𝘀𝗵 𝗮𝗴𝗮𝗶𝗻𝘀𝘁 $𝟰.𝟱 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 𝗼𝗳 𝗯𝗼𝗻𝗱𝘀 ⇒ stable Cloudflare sold $2.5 billion of new convertible bonds in August, paying no interest, and used $1.29 billion to repay bonds due in 2026. Cash and securities exceed the face value of the two remaining bonds by about $630 million, by our math. Interest on that cash was $45 million in the quarter. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗤𝟰 𝗥𝗲𝘃𝗲𝗻𝘂𝗲: $𝟴𝟰𝟱.𝟬–𝟴𝟰𝟲.𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating New. The plan calls for about 38% growth in the fourth quarter, just under this quarter's 39%. The previous four quarterly targets sat 3 to 5 points below the growth just reported; this one sits less than 2 points below. If the pattern of beats holds, by our math revenue would reach about $880 million. 𝗙𝗬𝟮𝟬𝟮𝟲 𝗥𝗲𝘃𝗲𝗻𝘂𝗲: $𝟮,𝟵𝟲𝟯.𝟬–𝟮,𝟵𝟲𝟰.𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable 🠅 raised from $2,864.0–2,870.0 million Raised. The middle of the range moved up $96.5 million, to about 37% growth for the year. It is the third raise this year and each was larger than the last: +$19M, +$58M, +$96.5M. The full-year figure equals the nine months reported plus the fourth-quarter plan, so it carries no separate signal. 𝗤𝟰 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗶𝗻𝗰𝗼𝗺𝗲, 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: $𝟭𝟱𝟲.𝟬–𝟭𝟱𝟳.𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating New. The plan has operating income excluding one-offs at about 18.5% of revenue by our math, a point above this quarter. A year ago the figure was 14.6%. Seifert attributed the step to the developer platform's lower selling costs and to the staff cuts completed in September. 𝗙𝗬𝟮𝟬𝟮𝟲 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗶𝗻𝗰𝗼𝗺𝗲, 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: $𝟰𝟲𝟮.𝟬–𝟰𝟲𝟯.𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating 🠅 raised from $443.0–445.0 million Raised. Up $18.5 million at the middle, to about 15.6% of revenue for the year, by our math. The middle of the range has moved from $380 million in February to $462.5 million now, in three steps, as each quarter beat its own target and the next one was set higher. 𝗤𝟰 𝗣𝗿𝗼𝗳𝗶𝘁 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲, 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: $𝟬.𝟰𝟯 ⇗ accelerating New. Profit per share excluding one-offs of $0.43 would be 54% above a year ago, on roughly the current share count. By our math it includes about $0.10 a share of after-tax interest income on the cash pile, assuming interest holds at this quarter's level. 𝗙𝗬𝟮𝟬𝟮𝟲 𝗣𝗿𝗼𝗳𝗶𝘁 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲, 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: $𝟭.𝟯𝟱 ⇗ accelerating 🠅 raised from $1.25–1.26 Raised. Up about 10 cents, after the quarter came in 4 cents above its own target and the fourth-quarter plan added the rest. The full-year figure equals the nine months reported plus the fourth-quarter plan, with the tax rate held at 20%. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗱𝗼𝗲𝘀 𝘁𝗵𝗲 𝗪𝗼𝗿𝗸𝗲𝗿𝘀 𝗽𝗹𝗮𝘁𝗳𝗼𝗿𝗺 𝗴𝗲𝗻𝗲𝗿𝗮𝘁𝗲? Management credits Workers for the acceleration and the operating margin, yet has never disclosed its revenue, growth rate or gross margin. Without it, investors cannot judge how much of the quarter came from usage that could slow. 𝗪𝗵𝗮𝘁 𝗮𝗿𝗲 𝘁𝗵𝗲 𝘁𝗵𝗶𝗿𝗱-𝗽𝗮𝗿𝘁𝘆 𝘁𝗲𝗰𝗵𝗻𝗼𝗹𝗼𝗴𝘆 𝘀𝗲𝗿𝘃𝗶𝗰𝗲𝘀 𝗰𝗼𝘀𝘁𝘀? The filing names a $43 million increase in this line as the largest reason the cost of revenue rose 54%. If it is AI model hosting or GPU rental, gross margin will keep following that usage; the call did not say. 𝗜𝘀 𝘁𝗵𝗲 $𝟱 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 𝗮𝗻𝗻𝘂𝗮𝗹𝗶𝘇𝗲𝗱 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝘁𝗮𝗿𝗴𝗲𝘁 𝗳𝗼𝗿 𝟮𝟬𝟮𝟴 𝘀𝘁𝗶𝗹𝗹 𝗶𝗻 𝗳𝗼𝗿𝗰𝗲? Cloudflare passed $3 billion a quarter early, yet nobody on the call restated the 2028 goal. Current growth exceeds what the target needs, so a reaffirmation or a higher number would both be informative. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗔𝗰𝘁 𝟰 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝘄𝗮𝘀 𝗿𝗲𝗰𝗼𝗿𝗱𝗲𝗱, 𝗮𝗻𝗱 𝗳𝗿𝗼𝗺 𝘄𝗵𝗼𝗺? Prince said the first revenue from charging AI companies for access to websites arrived this quarter. Even a small figure and a count of paying AI firms would show whether the business model exists outside the OpenAI arrangement. 𝗪𝗵𝗮𝘁 𝘄𝗶𝗹𝗹 𝘁𝗵𝗲 $𝟰𝟲𝟭 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝗼𝗳 𝗢𝗰𝘁𝗼𝗯𝗲𝗿 𝗰𝗼𝗺𝗽𝘂𝘁𝗲 𝗰𝗼𝗻𝘁𝗿𝗮𝗰𝘁𝘀 𝗱𝗼 𝘁𝗼 𝗴𝗿𝗼𝘀𝘀 𝗺𝗮𝗿𝗴𝗶𝗻? The commitments run three to ten years and add fixed capacity. Investors need the timing of the spend and whether it serves prepaid demand already signed or capacity Cloudflare expects to fill later.

$MP Q3 2026 earnings: MP's magnets pass GM's test, but its sales stop growing GM has approved MP Materials' first magnets, but the mine that pays the bills earned no more than last quarter. Revenue rose sharply from a year ago, lifted by a one-off $32 million sale of stockpiled material. Without it, revenue plus the government's price-floor payment slipped 1.5% from last quarter by our math, as that payment shrank. • Revenue plus price-floor income, excluding a one-off sale: $𝟭𝟮𝟰𝗠 (−1.5% from last quarter, by our math) • Revenue: $𝟭𝟰𝟳.𝟳𝗠 (+176% from a year ago) • NdPr produced: 𝟭,𝟬𝟭𝟴 𝘁𝗼𝗻𝘀 (+41% from a year ago; a record) • Fourth-quarter outlook: 𝗡𝗲𝘄: 𝗮𝗯𝗼𝘂𝘁 𝟭,𝟬𝟬𝟬 𝘁𝗼𝗻𝘀 𝗮𝘁 𝗮𝗯𝗼𝘂𝘁 $𝟭𝟬𝟬/𝗸𝗴 (level with this quarter) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: ⚪ Neutral The story is unchanged, because the main milestone arrived but the profit from it moved further out. GM's approval removes the risk of a missed deadline, and Mountain Pass set a production record. The caution: finance chief Ryan Corbett expects magnet profits to stay small through 2027, and plans NdPr income level with this quarter. The question now is whether magnets earn enough in 2027 to matter before a second plant opens in 2028. Either GM takes magnets fast enough to offset the fading metal prepayment, or the division's profit sits near zero for a year. February's fourth-quarter report gives the first reading. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 concern eased — 𝗚𝗠 𝗛𝗮𝘀 𝗔𝗽𝗽𝗿𝗼𝘃𝗲𝗱 𝗠𝗣'𝘀 𝗠𝗮𝗴𝗻𝗲𝘁𝘀 𝗳𝗼𝗿 𝗦𝗮𝗹𝗲 MP Materials has spent five years building a magnet factory in Fort Worth, Texas, that it calls Independence. General Motors is the first customer, and until now GM took only test magnets while it checked the plant. Chief executive James Litinsky said the quarter marks "an inflection point" for the business. GM has now approved the magnets, so paid deliveries begin this quarter. Finance chief Ryan Corbett expects volumes to "build gradually, starting quite modestly over the next couple of quarters". A bigger step comes in the second half of 2027, when production for Apple also starts. Apple has already paid $80 million of a planned $200 million in advance. The approval removes the risk that the plant would miss its deadline, but it does not show what a magnet earns. Corbett declined to give volumes or prices, and he expects the division's profit to stay small through 2027. What to watch: the magnet revenue figure in the fourth-quarter results in February. It will show whether GM is taking magnets into real car programmes or still buying test quantities. 🟢🟢 𝗠𝗼𝘂𝗻𝘁𝗮𝗶𝗻 𝗣𝗮𝘀𝘀 𝗦𝗲𝘁 𝗮 𝗣𝗿𝗼𝗱𝘂𝗰𝘁𝗶𝗼𝗻 𝗥𝗲𝗰𝗼𝗿𝗱 Mountain Pass, the California mine and refinery that supplies almost all of MP's revenue, produced a record 1,018 tons of NdPr oxide. NdPr is the pair of rare earths that permanent magnets are made from. Operations chief Michael Rosenthal said the plant ran at "over 450 tons per month" for part of the quarter. That rate matters because 450 tons a month is close to the 500 tons Rosenthal wants from the existing equipment. He plans an "over 5,000 ton per annum production rate for the year" in 2027. The reliability problems have not gone away, though. Rosenthal said "a small number of circuits experienced unplanned maintenance activities and equipment-related interruptions". • Production: 1,018 tons, up 41% from a year ago • Sales: 1,020 tons, up 94% from a year ago • Concentrate output at the mine: 12,887 tons, down 3% • 2027 plan: about 1,250 tons a quarter by our math, 23% above this quarter What to watch: fourth-quarter production, after a planned maintenance stop of 10 to 14 days in October. A figure near this quarter's would confirm that the higher running rate is real. 🟢 𝗛𝗲𝗮𝘃𝘆 𝗥𝗮𝗿𝗲 𝗘𝗮𝗿𝘁𝗵 𝗢𝘂𝘁𝗽𝘂𝘁 𝗦𝘁𝗮𝗿𝘁𝘀 𝗧𝗵𝗶𝘀 𝗤𝘂𝗮𝗿𝘁𝗲𝗿 MP has stockpiled the heavier rare earths it separates while it built a plant to refine them. Dysprosium and terbium go into magnets that must work at high heat; China controls most supply. Litinsky said "the commercial scale production of dysprosium and terbium will begin this quarter, Q4". The stockpile has already earned money. MP sold $31.6 million of a mixed heavy rare earth product it calls SEG+ to a US aerospace and defence customer. That buyer signed a long-term gadolinium contract in July. Rosenthal cautioned that "we do not believe today's elevated prices will persist indefinitely". What to watch: the first finished terbium and dysprosium, due in the fourth-quarter report. The early output goes to MP's own magnet plant, Corbett said, so it will not appear as revenue. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗪𝗶𝘁𝗵𝗼𝘂𝘁 𝘁𝗵𝗲 𝗢𝗻𝗲-𝗢𝗳𝗳 𝗦𝗮𝗹𝗲, 𝗜𝗻𝗰𝗼𝗺𝗲 𝗦𝘁𝗼𝗼𝗱 𝗦𝘁𝗶𝗹𝗹 Litinsky described "a strong quarter of growth across production, sales, and earnings". The headline agrees: revenue rose 176% from a year ago, a quarter when MP had just stopped selling to China. But $31.6 million of it came from one sale of stockpiled material, "a bit of a one-off to support a strategic customer", Corbett said. Strip out that sale and the picture changes. The Department of War pays MP the gap between $110 a kilogram and a market benchmark. That payment shrinks as market prices rise. After the midterms Litinsky said "we really see no change" to that contract. • Revenue plus floor income, excluding the sale: $124 million, down 1.5% from last quarter by our math • Floor payment per kilogram sold: about $8, from about $17 last quarter by our math • MP's price plus floor payment: about $107 a kilogram, below the $110 floor, because the floor tracks a benchmark, not MP's price What to watch: fourth-quarter NdPr revenue plus floor income, against $109 million this quarter. Corbett plans "approximately 1,000 metric tons and $100 per kilogram", which gives the same figure by our math. 🔴 𝗠𝗮𝗴𝗻𝗲𝘁 𝗣𝗿𝗼𝗳𝗶𝘁𝘀 𝗦𝘁𝗮𝘆 𝗦𝗺𝗮𝗹𝗹 𝗨𝗻𝘁𝗶𝗹 𝟮𝟬𝟮𝟴 The magnet division still lives on a prepayment. GM paid $150 million in advance for NdPr metal, and MP books it as revenue as it delivers. Only $27.6 million remains, so Corbett expects it to run off "at a declining rate". Magnets will not replace it quickly. Corbett said the division's profit will stay modest through 2027, and expects "the full earnings power of the segment to become visible in 2028". The squeeze shows: the division's margin fell to 29% from 46% last quarter, because costs once charged to metal now sit with the first magnets. What to watch: Magnetics revenue in the fourth quarter, when the first magnet sales join shrinking metal revenue. A total below this quarter's $18.6 million would mean magnets are not yet covering the run-off. 🔴 𝗕𝘂𝗶𝗹𝗱𝗶𝗻𝗴 𝗖𝗼𝘀𝘁𝘀 𝗢𝘂𝘁𝗿𝘂𝗻 𝗖𝗮𝘀𝗵 𝗪𝗵𝗶𝗹𝗲 𝗡𝗼𝘁𝗲𝘀 𝗕𝗲𝗰𝗼𝗺𝗲 𝗖𝗼𝗻𝘃𝗲𝗿𝘁𝗶𝗯𝗹𝗲 MP spent $113 million on plants and equipment in the quarter, while operations used $13 million of cash by our math. Free cash flow was therefore about minus $125 million. Cash and investments fell to $1.34 billion from $1.45 billion in June. Corbett held the full-year building budget at "$500 million-$600 million". The balance sheet can carry that for now. But holders of MP's $863 million of convertible notes may now swap them for shares. The notes passed their conversion test in the quarter, the filing says. Full conversion would add about 40 million shares to 178 million by our math. What to watch: the diluted share count in the fourth-quarter report, and whether MP pays cash or issues shares for any notes converted. 🔴 𝗥𝗶𝘀𝗸𝘀 𝘁𝗵𝗶𝘀 𝗾𝘂𝗮𝗿𝘁𝗲𝗿 𝗱𝗶𝗱𝗻'𝘁 𝗮𝗻𝘀𝘄𝗲𝗿 Four standing concerns got words from management but no numbers, so none of them moved. Each needs one disclosure to settle it. • NdPr cost per kilogram: no figure again; Corbett expects lower costs in the second half of 2027, once new plants settle. • Magnet prices and margins: not disclosed; Corbett declined to give volumes "given the nature of our customer contracts". • 10X economics: Litinsky said customer requests "well exceed the 10X capacity", but gave no price or margin for the plant's output. • Customer concentration: four customers made 89% of revenue by our math, and the new one at 21% bought the one-off SEG+ product. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗖𝗵𝗶𝗻𝗮'𝘀 𝗘𝘅𝗽𝗼𝗿𝘁 𝗖𝘂𝗿𝗯𝘀 𝗞𝗲𝗲𝗽 𝗥𝗮𝗿𝗲 𝗘𝗮𝗿𝘁𝗵 𝗣𝗿𝗶𝗰𝗲𝘀 𝗛𝗶𝗴𝗵 China restricted exports of rare earths through 2025 and, MP's filing says, agreed in November 2025 to suspend the expanded controls. Shortages and high prices for the heavier rare earths have continued since. The filing calls these trends ones that "may or may not be permanent". Litinsky pointed to a presidential proclamation on robotics and new FCC limits on foreign-made robots as reasons US buyers will want domestic magnets. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗯𝗼𝗼𝗸𝗲𝗱 𝗯𝗲𝗳𝗼𝗿𝗲 𝘀𝗵𝗶𝗽𝗺𝗲𝗻𝘁 (𝗯𝗶𝗹𝗹-𝗮𝗻𝗱-𝗵𝗼𝗹𝗱), 𝟮𝟲𝗤𝟯: 𝟱𝟲% 𝗼𝗳 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 ⇗ accelerating Rising for a third quarter. MP recognised 56% of revenue while the goods stayed in its own or a warehouse's custody, against 47% in the second quarter. A year ago the share was 41%. Without the one-off sale, itself a bill-and-hold deal, the share was 44% by our math. The practice is allowed when the customer owns goods set aside for it. 𝗢𝘃𝗲𝗿𝗵𝗲𝗮𝗱 𝗮𝗻𝗱 𝘀𝘁𝗮𝗿𝘁-𝘂𝗽 𝗰𝗼𝘀𝘁𝘀 𝗮𝘀 𝗮 𝘀𝗵𝗮𝗿𝗲 𝗼𝗳 𝗿𝗲𝘃𝗲𝗻𝘂𝗲, 𝟮𝟲𝗤𝟯: 𝟮𝟱.𝟳% 𝗮𝗻𝗱 𝟵.𝟲% ⇘ decelerating Overhead keeps shrinking against revenue. Selling, general and administrative costs took 25.7% of revenue, down from 53.0% a year ago. The share was 32.4% in the second quarter. The dollar amount still rose 34% because MP added staff. Start-up costs for the magnet and chlor-alkali plants took another 9.6% of revenue, and Corbett expects them to continue through the first half of 2027. 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗽𝗿𝗲𝗽𝗮𝘆𝗺𝗲𝗻𝘁𝘀 (𝗱𝗲𝗳𝗲𝗿𝗿𝗲𝗱 𝗿𝗲𝘃𝗲𝗻𝘂𝗲), 𝟮𝟲𝗤𝟯: $𝟭𝟮𝟬.𝟰 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Down $6 million in the quarter to $120 million, the third decline in a row. Deferred revenue is cash customers paid for goods not yet delivered. The balance mixes GM's remaining metal prepayment, which MP works down as it delivers, with $80 million from Apple. MP cannot book the Apple money until magnets ship to Apple from late 2027. Apple paid another $8 million in the quarter. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗤𝟰 𝗡𝗱𝗣𝗿 𝘀𝗮𝗹𝗲𝘀 𝘃𝗼𝗹𝘂𝗺𝗲: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 𝟭,𝟬𝟬𝟬 𝗺𝗲𝘁𝗿𝗶𝗰 𝘁𝗼𝗻𝘀 ⇒ stable New. Corbett expects to sell about 1,000 tons of NdPr in the fourth quarter, level with the 1,020 tons sold this quarter. Production took a planned maintenance stop of 10 to 14 days in October, so sales will depend on finished stock. Rosenthal expects fourth-quarter production to keep growing at a similar pace from a year ago. 𝗤𝟰 𝗡𝗱𝗣𝗿 𝘀𝗲𝗹𝗹𝗶𝗻𝗴 𝗽𝗿𝗶𝗰𝗲 𝗮𝗻𝗱 𝗳𝗹𝗼𝗼𝗿 𝗶𝗻𝗰𝗼𝗺𝗲: 𝗮𝗯𝗼𝘂𝘁 $𝟭𝟬𝟬 𝗽𝗲𝗿 𝗸𝗴 𝗿𝗲𝗮𝗹𝗶𝘇𝗲𝗱 𝗽𝗿𝗶𝗰𝗲 𝗽𝗹𝘂𝘀 𝗮𝗯𝗼𝘂𝘁 $𝟴 𝗽𝗲𝗿 𝗸𝗴 𝗼𝗳 𝗣𝗣𝗔 𝗶𝗻𝗰𝗼𝗺𝗲 𝗼𝗻 𝘁𝗼𝗻𝘀 𝘀𝗼𝗹𝗱 ⇒ stable New. Corbett expects a selling price of about $100 a kilogram, with a floor payment of about $8 on top. The sum stays below the $110 floor for a second quarter, because the payment tracks a market benchmark rather than MP's own price. On 1,000 tons that gives about $108 million of NdPr income, level with this quarter by our math. 𝗙𝗬𝟮𝟬𝟮𝟲 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝗲𝘅𝗽𝗲𝗻𝗱𝗶𝘁𝘂𝗿𝗲𝘀: $𝟱𝟬𝟬–𝟲𝟬𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating 🠆 unchanged from $500–600 million Unchanged. MP has spent $414 million in nine months on the filing's measure, net of government grants. The range therefore leaves $86 million to $186 million for the fourth quarter by our math. That is more than the $106 million spent in the third. About 60% of the year's spending so far went to magnets, mainly the 10X plant and its land in Texas, Corbett said. 𝗙𝗶𝗿𝘀𝘁 𝗽𝗮𝗶𝗱 𝗺𝗮𝗴𝗻𝗲𝘁 𝗱𝗲𝗹𝗶𝘃𝗲𝗿𝗶𝗲𝘀 𝘁𝗼 𝗚𝗠: 𝗤𝟰 𝟮𝟬𝟮𝟲 ⇒ stable 🠆 unchanged from Q4 2026 (initial deliveries, stated in August) Unchanged. GM has finished qualifying the magnets, and Corbett expects saleable deliveries and the first magnet revenue in the fourth quarter. Volumes start small, he said, and magnet sales are "likely to be lumpy quarter-to-quarter". GM phases MP's magnets into specific programmes and plants over time. 𝗖𝗼𝗺𝗺𝗲𝗿𝗰𝗶𝗮𝗹 𝗱𝘆𝘀𝗽𝗿𝗼𝘀𝗶𝘂𝗺 𝗮𝗻𝗱 𝘁𝗲𝗿𝗯𝗶𝘂𝗺 𝗽𝗿𝗼𝗱𝘂𝗰𝘁𝗶𝗼𝗻: 𝗯𝗲𝗴𝗶𝗻𝘀 𝗤𝟰 𝟮𝟬𝟮𝟲 ⇒ stable 🠆 unchanged from later in 2026 (stated in August) Unchanged. Litinsky said commercial-scale production of the two heavy rare earths starts this quarter, in line with the timing given in August. Rosenthal said the first circuits are running as planned. The output goes first to MP's own magnet plant, so Corbett expects no outside revenue from it for a while. 𝟮𝟬𝟮𝟳 𝗡𝗱𝗣𝗿 𝗽𝗿𝗼𝗱𝘂𝗰𝘁𝗶𝗼𝗻: 𝗺𝗼𝗿𝗲 𝘁𝗵𝗮𝗻 𝟱,𝟬𝟬𝟬 𝗺𝗲𝘁𝗿𝗶𝗰 𝘁𝗼𝗻𝘀 𝗳𝗼𝗿 𝘁𝗵𝗲 𝘆𝗲𝗮𝗿 ⇗ accelerating New. Rosenthal expects Mountain Pass to produce at a rate above 5,000 tons across 2027. That is about 1,250 tons a quarter by our math, against 1,018 this quarter. The plan already includes extra downtime in the first quarter for the start of the chlor-alkali plant, which makes the refinery's own chemicals. Recycling and heavy rare earth projects add more. 𝟮𝟬𝟮𝟳 𝗠𝗮𝗴𝗻𝗲𝘁𝗶𝗰𝘀 𝘀𝗲𝗴𝗺𝗲𝗻𝘁 𝗽𝗿𝗼𝗳𝗶𝘁: 𝗺𝗼𝗱𝗲𝘀𝘁 𝗮𝗱𝗷𝘂𝘀𝘁𝗲𝗱 𝗘𝗕𝗜𝗧𝗗𝗔 𝗰𝗼𝗻𝘁𝗿𝗶𝗯𝘂𝘁𝗶𝗼𝗻; 𝗺𝗮𝗴𝗻𝗲𝘁 𝘀𝗮𝗹𝗲𝘀 𝗽𝗿𝗼𝗳𝗶𝘁𝗮𝗯𝗹𝗲 𝗳𝗿𝗼𝗺 𝘁𝗵𝗲 𝘀𝘁𝗮𝗿𝘁 ⇘ decelerating New. Corbett expects magnet sales to earn a profit from the first delivery. But the segment's total will "continue to be modest in 2027, particularly in the first half", because shrinking metal revenue offsets the early magnet sales. Start-up costs continue "for at least the first half of next year". He expects "the full earnings power of the segment to become visible in 2028". — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗪𝗵𝗮𝘁 𝗱𝗶𝗱 𝘁𝗵𝗲 𝗦𝗘𝗚+ 𝘀𝗮𝗹𝗲 𝗰𝗼𝘀𝘁, 𝗮𝗻𝗱 𝘄𝗵𝗮𝘁 𝗱𝗶𝗱 𝗶𝘁 𝗲𝗮𝗿𝗻? Corbett declined to give the cost. The stockpile built up as a by-product of NdPr separation. The margin on this $31.6 million sale decides how much of the quarter's profit was repeatable. 𝗪𝗵𝘆 𝗶𝘀 𝗽𝗿𝗶𝗰𝗲 𝗽𝗹𝘂𝘀 𝗳𝗹𝗼𝗼𝗿 𝗽𝗮𝘆𝗺𝗲𝗻𝘁 𝗯𝗲𝗹𝗼𝘄 $𝟭𝟭𝟬? The floor pays the gap between $110 and a market benchmark, yet MP's own price plus payment came to about $107 by our math. Readers need the benchmark and MP's discount to it. 𝗪𝗵𝗮𝘁 𝗱𝗼𝗲𝘀 𝗮 𝗸𝗶𝗹𝗼𝗴𝗿𝗮𝗺 𝗼𝗳 𝗡𝗱𝗣𝗿 𝗰𝗼𝘀𝘁 𝘁𝗼 𝗺𝗮𝗸𝗲 𝘁𝗼𝗱𝗮𝘆? The $40 target has no date and, for another quarter, no progress figure. Corbett pointed to the second half of 2027 for lower unit costs, which leaves the 2026 level unknown. 𝗛𝗼𝘄 𝗺𝗮𝗻𝘆 𝗺𝗮𝗴𝗻𝗲𝘁𝘀, 𝗮𝘁 𝘄𝗵𝗮𝘁 𝗽𝗿𝗶𝗰𝗲, 𝘄𝗶𝗹𝗹 𝗚𝗠 𝘁𝗮𝗸𝗲 𝗶𝗻 𝟮𝟬𝟮𝟳? Corbett gave no volumes or prices and declined again to say when Independence reaches 1,000 tons a year. The magnet ramp is the whole 2027 story and has no numbers. 𝗪𝗶𝗹𝗹 𝗠𝗣 𝘀𝗲𝘁𝘁𝗹𝗲 𝗻𝗼𝘁𝗲 𝗰𝗼𝗻𝘃𝗲𝗿𝘀𝗶𝗼𝗻𝘀 𝗶𝗻 𝗰𝗮𝘀𝗵 𝗼𝗿 𝘀𝗵𝗮𝗿𝗲𝘀? Holders of $863 million of notes may convert this quarter. MP may pay cash, shares or both, and the choice decides whether the share count rises by up to 40 million.

$MAT Q3 2026 earnings: Tariff refund lifts Mattel's profit, but Mattel cuts its outlook Mattel's profit rose only because of a tariff refund, and its new chief executive cut the plan he inherited. Sales grew 4% on Hot Wheels and licensed dolls, while Barbie and Fisher-Price kept shrinking. Chief executive Roger Lynch said "Barbie is a priority, but the current performance is not where it needs to be"; its billings fell 9%. By our math the plan has fourth-quarter sales falling about 1%. • Sales: $𝟭,𝟴𝟬𝟳𝗠 (+4% from a year ago; +3% before currency) • Operating profit, excluding one-offs: $𝟱𝟬𝟮𝗠 ($88M of it is a tariff refund) • Full-year operating profit outlook: 𝗖𝘂𝘁 $𝟳𝟬𝗠 (middle of the range: $535M, before any refunds) • Hot Wheels billings: +𝟳% (+14% last quarter) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🔴 Bearish The story got worse because the year's plan came down. The outlook excludes the refund already received, so by our math fourth-quarter operating profit lands 9% below last year. The good news: Hot Wheels heads for a ninth record year, and the cost programme hit its target early. The question now is whether the slowdown is the toy market's or Mattel's. Either shoppers bought less everywhere, as finance chief Peter Griffith described, or Mattel's brands lost ground; he declined to say which. February's holiday numbers and 2027 plan will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢 𝗛𝗼𝘁 𝗪𝗵𝗲𝗲𝗹𝘀 𝗛𝗲𝗮𝗱𝘀 𝗳𝗼𝗿 𝗮 𝗡𝗶𝗻𝘁𝗵 𝗥𝗲𝗰𝗼𝗿𝗱 𝗬𝗲𝗮𝗿 Hot Wheels is Mattel's largest brand, a line of die-cast cars. It is "on track for its ninth consecutive record year", chief executive Roger Lynch said on his first call. He added that the brand is "approaching $2 billion in gross billings" and will make about 1 billion cars this year. Billings rose 7% in the quarter, and every vehicle brand grew, outgoing finance chief Paul Ruh said. The pace has slowed, though, from 17% in the first quarter, so the brand no longer covers the shrinking ones alone. What to watch: Hot Wheels billings in the fourth quarter against the company total, which the new outlook has falling by our math. Growth there while the rest declines would place the problem in Barbie and Fisher-Price, not toy demand. 🟢 𝗟𝗶𝗰𝗲𝗻𝘀𝗲𝗱 𝗗𝗼𝗹𝗹𝘀 𝗥𝗲𝘁𝘂𝗿𝗻 𝘁𝗵𝗲 𝗖𝗮𝘁𝗲𝗴𝗼𝗿𝘆 𝘁𝗼 𝗚𝗿𝗼𝘄𝘁𝗵 Dolls are Mattel's biggest category, and they grew for the first time since the holiday quarter because of brands Mattel licenses rather than owns. Billings rose 4%, and partner brands, led by KPop Demon Hunters dolls from the Netflix film, added 13 points, the filing said. Lynch said Mattel moved "quickly behind a rapidly evolving cultural phenomenon" and treats partner brands "as if they were our own". Licensed toys cost more to sell, though, because the licensor takes a share. Royalty payments rose 17%, or 0.6 points more of sales than a year ago. What to watch: the Dolls growth rate in the fourth quarter, the film's first holiday season. A second quarter of growth would show the licence adds sales rather than just covering Barbie. 🟢 𝗣𝗼𝘀𝗶𝘁𝗶𝘃𝗲𝘀 𝘁𝗵𝗶𝘀 𝗾𝘂𝗮𝗿𝘁𝗲𝗿 𝗱𝗶𝗱𝗻'𝘁 𝘁𝗲𝘀𝘁 Three parts of the growth story that Mattel's previous management built got no numbers this quarter. Lynch set priorities that start with toys, and said of them that "it's not a strategy change. It is a focus change". • Digital games: Mattel163 no longer reports its own results, and the second self-published game, UNO Wild, got no update. Its sales would show whether the studio earns its price. • Films and content: the Matchbox film due on Apple TV in October and the Thomas & Friends relaunch went unmentioned. Fourth-quarter billings would show whether content sells toys. • Building sets: Lynch called Mattel Brick Shop "a great success" and is "evaluating capacity around the world". Yet Building Sets took 3 points off its category's growth; a return to growth would support his plan. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗠𝗮𝘁𝘁𝗲𝗹 𝗖𝘂𝘁𝘀 𝗜𝘁𝘀 𝗢𝘂𝘁𝗹𝗼𝗼𝗸 𝗮𝘀 𝗦𝘁𝗼𝗿𝗲 𝗦𝗮𝗹𝗲𝘀 𝗦𝗹𝗼𝘄 Mattel kept its full-year plan in July. Finance chief Peter Griffith has now lowered every line. He cited "a deceleration in trends during the latter part of the third quarter" and "similar trends across our major markets" into the fourth. The cut is larger than it looks, because the plan leaves out the $88 million refund already booked. By our math, the fourth quarter gets about $153 million of operating profit, 9% below last year. Sales would fall about 1%. • Buybacks: about $8 million, after $100 million in the second quarter, by our math • Debt to cash profit, excluding one-offs: 2.7 times, from 2.5 a year ago • Cash: $541 million, down from $692 million "The company's earlier commentary reflected the information available at that time," Griffith said. Yet the quarter landed inside the range the July plan implied, so the shortfall sits entirely in the fourth quarter. Thinner cash profit matters too: $600 million of notes fall due in December 2027. What to watch: fourth-quarter sales against the roughly $1.7 billion the plan implies, by our math. A result near the bottom would mean the slowdown deepened over the holidays. 🔴🔴 𝗧𝗵𝗲 𝗣𝗿𝗼𝗳𝗶𝘁 𝗜𝗻𝗰𝗿𝗲𝗮𝘀𝗲 𝗜𝘀 𝗮 𝗧𝗮𝗿𝗶𝗳𝗳 𝗥𝗲𝗳𝘂𝗻𝗱 Mattel reported operating profit excluding one-offs of $502 million, up $106 million. The release credits a gross margin "primarily driven by $88 million of tariff refunds received". The Supreme Court ruled those duties unlawful in February. Without the refund, gross margin excluding one-offs was 50.1% by our math, against 50.2% a year ago. Inflation and higher royalties ate what the games studio, currency and savings added. • Cost of goods: refund worth 4.9 points of sales; inflation 2.0 points against; royalties 0.8 points against • Advertising: up 1.1 points of sales • Overheads excluding one-offs: down 1.3 points of sales, almost all from reversing the departed chief executive's stock awards Without the refund and that reversal, operating profit was about $390 million by our math, under last year's $395 million. So the quarter hid the pressure from inflation and royalties rather than easing it. Customs opened a third refund phase in October, but July class actions seek to hand refunds to consumers. What to watch: fourth-quarter gross margin excluding one-offs and refunds, near 47% in the plan by our math. A lower figure would mean inflation and royalties still beat the cost programme. 🔴 𝗕𝗮𝗿𝗯𝗶𝗲 𝗮𝗻𝗱 𝗙𝗶𝘀𝗵𝗲𝗿-𝗣𝗿𝗶𝗰𝗲 𝗞𝗲𝗲𝗽 𝗦𝗵𝗿𝗶𝗻𝗸𝗶𝗻𝗴 Barbie, Mattel's flagship doll, and Fisher-Price, its infant and preschool brand, keep falling. Lynch said "the trends on Barbie have maybe improved slightly, as you saw in Q3, but still down year-over-year". • Barbie: down 9%, after 16% declines in the two previous quarters • Fisher-Price: down 14%; its category down 16%, the steepest fall in the portfolio Previous management expected Barbie to grow again in 2027 and promised double-digit profit growth that year. Griffith declined to repeat either and deferred 2027 to February. The year-old infant and preschool review went unmentioned. That matters because the 2027 recovery justified this year's spending. What to watch: Barbie's fourth-quarter billings and whether the February plan keeps the 2027 return to growth. Another decline would make dropping that promise the easy choice. 🔴🔴 𝗡𝗲𝘄 𝗖𝗮𝘁𝗲𝗴𝗼𝗿𝗶𝗲𝘀 𝗚𝗿𝗲𝘄 𝗢𝗻𝗹𝘆 𝗪𝗶𝘁𝗵 𝘁𝗵𝗲 𝗔𝗰𝗾𝘂𝗶𝗿𝗲𝗱 𝗦𝘁𝘂𝗱𝗶𝗼 Mattel's fastest category holds action figures, building sets and games, including Mattel163, the mobile games studio bought outright in March. Billings rose 12%, and the category was the main growth story of the first half. Ruh said that "Excluding the contribution of Mattel163, gross billings for the challenger categories declined". He blamed the loss of the Pokémon licence last year and retailers moving orders into the fourth quarter. • Games, including Mattel163: 9 points of the growth • Action Figures: 5 points • Building Sets: minus 3 points This matters because the studio's sales were not in last year's numbers, so Mattel bought that growth. It stopped publishing the studio's results after one quarter, so readers cannot separate the two. If the studio added the same $49 million as in spring, sales from businesses Mattel owned a year ago grew about 1%, by our math. What to watch: the category's growth rate in the first quarter of 2027, when the studio enters the comparison. A rate near zero then would confirm that this year's growth in new categories was the acquisition. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗔 𝗡𝗲𝘄 𝗖𝗵𝗶𝗲𝗳 𝗘𝘅𝗲𝗰𝘂𝘁𝗶𝘃𝗲, 𝗙𝗶𝗻𝗮𝗻𝗰𝗲 𝗖𝗵𝗶𝗲𝗳 𝗮𝗻𝗱 𝗣𝗿𝗲𝘀𝗶𝗱𝗲𝗻𝘁 Roger Lynch became chief executive in October after Ynon Kreiz left; Peter Griffith joined as finance chief and Steve Totzke became president and operating chief. Lynch's priorities: "strengthen our brands and win in toys, drive innovation and creativity, and invest with discipline to drive profitable growth". He noted "considerable external commentary about the company recently", said the board will "explore any actionable opportunities", and gave shareholder EdgePoint a board seat. 𝗖𝗼𝘀𝘁 𝗣𝗿𝗼𝗴𝗿𝗮𝗺𝗺𝗲 𝗥𝗲𝗮𝗰𝗵𝗲𝘀 𝗜𝘁𝘀 𝗧𝗮𝗿𝗴𝗲𝘁 𝗘𝗮𝗿𝗹𝘆 Optimizing for Profitable Growth is the three-year programme to cut factory and overhead costs. It reached its full $225 million of annual savings by the end of September, a quarter before its end-2026 deadline, the filing said. Savings are "now expected at or above the $225 million target". Mattel announced no successor programme, though Lynch said he will look at "global cost structures" and use AI to raise productivity. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝘀𝗽𝗲𝗻𝗱𝗶𝗻𝗴 (𝗻𝗶𝗻𝗲 𝗺𝗼𝗻𝘁𝗵𝘀): $𝟭𝟴𝟲 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Up 49% from a year ago, and now 4.4% of sales over twelve months. A year earlier it was 3.3%. Free cash flow over twelve months fell 10% to $440 million as a result, even though operating cash flow rose. Lynch said Mattel is evaluating factory capacity for Brick Shop, so the spending may stay high. 𝗜𝗻𝘃𝗲𝗻𝘁𝗼𝗿𝘆: $𝟴𝟮𝟴 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable Flat against a year ago while sales grew 4%. Receivables were flat too, at $1.4 billion, and customers paid two days faster. Griffith said retailer inventories are below last year, so Mattel's own stock is not the risk going into the holidays; the question is how fast retailers reorder. 𝗗𝗶𝗹𝘂𝘁𝗲𝗱 𝘀𝗵𝗮𝗿𝗲 𝗰𝗼𝘂𝗻𝘁: 𝟮𝟴𝟳 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Down 9.8% from a year ago after $496 million of buybacks over twelve months. That gap between the share count and profit is why earnings per share grew faster than operating profit. The quarter itself added almost no buybacks, so the decline will slow from here. 𝗜𝗻𝘁𝗲𝗿𝗻𝗮𝘁𝗶𝗼𝗻𝗮𝗹 𝘀𝗲𝗴𝗺𝗲𝗻𝘁 𝗽𝗿𝗼𝗳𝗶𝘁: $𝟮𝟬𝟵 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable Unchanged from a year ago while international sales rose 5%, because advertising and overheads in the segment rose faster than sales. The segment's profit margin slipped to 26.3% from 27.5%. North America, which received the whole tariff refund, grew its profit 22%. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗙𝘂𝗹𝗹-𝘆𝗲𝗮𝗿 𝘀𝗮𝗹𝗲𝘀 𝗴𝗿𝗼𝘄𝘁𝗵, 𝗰𝗼𝗻𝘀𝘁𝗮𝗻𝘁 𝗰𝘂𝗿𝗿𝗲𝗻𝗰𝘆: +𝟭% 𝘁𝗼 +𝟰% ⇘ decelerating 🠇 cut from +3% to +6% Cut. The plan now has sales growing about 2.5% at the middle of the range before currency. Currency adds about 1 point on top. By our math that leaves fourth-quarter sales of roughly $1.7 billion at the middle of the range. That is about 1% below last year, after 4% growth this quarter. Griffith blamed slower sales at the tills late in the quarter across major markets. 𝗙𝘂𝗹𝗹-𝘆𝗲𝗮𝗿 𝗴𝗿𝗼𝘀𝘀 𝗺𝗮𝗿𝗴𝗶𝗻, 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: ~𝟰𝟴% ⇘ decelerating 🠇 cut from ~50% Cut, and the new figure excludes tariff refunds, which the old one never counted either. By our math, the plan implies about 47% in the fourth quarter, against 46% a year ago when heavy promotions hit. The quarter just reported came in near 50% without the refund, so the fourth quarter stays the weakest of the year. 𝗙𝘂𝗹𝗹-𝘆𝗲𝗮𝗿 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗽𝗿𝗼𝗳𝗶𝘁, 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: $𝟱𝟬𝟬–𝟱𝟳𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating 🠇 cut from $580–630 million Cut. The middle of the range fell $70 million to $535 million. It excludes the $88 million refund already received. By our math the fourth quarter gets $118–188 million. A year ago it earned $169 million on the same basis. The record runs one way: Mattel reiterated last year's plan in the third quarter and then missed it; it held this year's in July and cut it now. 𝗙𝘂𝗹𝗹-𝘆𝗲𝗮𝗿 𝗽𝗿𝗼𝗳𝗶𝘁 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲, 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: $𝟭.𝟬𝟱–𝟭.𝟮𝟬 ⇘ decelerating 🠇 cut from $1.27–1.39 Cut. The middle of the range fell to $1.13 from $1.33. That is a quarter below last year's $1.49, and it excludes refunds. The share count is about 10% lower than a year ago. So the cut in profit per share is smaller than the cut in operating profit alone would produce. 𝗙𝘂𝗹𝗹-𝘆𝗲𝗮𝗿 𝘁𝗮𝘅 𝗿𝗮𝘁𝗲, 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: ~𝟮𝟯% ⇒ stable 🠇 cut from ~24% Lowered by a point, which adds a little to profit per share. The rate was 22% this quarter, and the refund carried its own tax charge of $9.9 million, which the filing lists as a one-off item. 𝗖𝘂𝗿𝗿𝗲𝗻𝗰𝘆 𝗲𝗳𝗳𝗲𝗰𝘁 𝗼𝗻 𝗳𝘂𝗹𝗹-𝘆𝗲𝗮𝗿 𝘀𝗮𝗹𝗲𝘀: ~𝟭 𝗽𝗼𝗶𝗻𝘁 𝗯𝗲𝗻𝗲𝗳𝗶𝘁 ⇒ stable 🠆 unchanged from ~1 point benefit Unchanged. Currency adds about a point to reported sales for the year at current rates. In reported terms the plan therefore runs about a point above the 1% to 4% constant-currency range. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗼𝗳 𝘁𝗵𝗶𝘀 𝘆𝗲𝗮𝗿'𝘀 𝗴𝗿𝗼𝘄𝘁𝗵 𝗰𝗮𝗺𝗲 𝗳𝗿𝗼𝗺 𝗠𝗮𝘁𝘁𝗲𝗹𝟭𝟲𝟯? Ruh said the new categories declined without the studio, and Mattel no longer reports its results. Readers cannot tell growth from businesses Mattel owned a year ago from the acquisition until it enters the comparison in March. 𝗜𝘀 𝘁𝗵𝗲 $𝟰𝟬𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝟮𝟬𝟮𝟲 𝗯𝘂𝘆𝗯𝗮𝗰𝗸 𝘁𝗮𝗿𝗴𝗲𝘁 𝘀𝘁𝗶𝗹𝗹 𝗶𝗻 𝗽𝗹𝗮𝗰𝗲? Mattel bought about $8 million of shares in the quarter after $300 million in the first half, by our math. Neither the release nor the call repeated the target set in July. 𝗗𝗼𝗲𝘀 𝘁𝗵𝗲 𝟮𝟬𝟮𝟳 𝗽𝗹𝗮𝗻 𝗸𝗲𝗲𝗽 𝗕𝗮𝗿𝗯𝗶𝗲'𝘀 𝗿𝗲𝘁𝘂𝗿𝗻 𝘁𝗼 𝗴𝗿𝗼𝘄𝘁𝗵? The previous management expected Barbie to grow in 2027 and profit to rise double digits. Griffith deferred everything to February, so the targets that justified this year's spending are open. 𝗪𝗵𝗮𝘁 𝗶𝘀 𝘁𝗵𝗲 𝗼𝘂𝘁𝗰𝗼𝗺𝗲 𝗼𝗳 𝘁𝗵𝗲 𝗙𝗶𝘀𝗵𝗲𝗿-𝗣𝗿𝗶𝗰𝗲 𝗿𝗲𝘃𝗶𝗲𝘄? The strategic assessment of the infant and preschool business is a year old. The category fell 16% again, and the new management did not mention it. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗺𝗼𝗿𝗲 𝘁𝗮𝗿𝗶𝗳𝗳 𝗿𝗲𝗳𝘂𝗻𝗱 𝗰𝗮𝗻 𝗠𝗮𝘁𝘁𝗲𝗹 𝗸𝗲𝗲𝗽? Customs opened a third refund phase in October and Mattel has booked no receivable. Class actions seek to return refunds to consumers, and the new outlook excludes any further refunds.

$INTT Q3 2026 earnings: InTest's chip orders tripled, but its outlook has profit slipping InTest, a maker of chip-testing equipment, took record orders, but its outlook has profit shrinking again next quarter. Chipmakers ordered three times as much as a year ago, lifting the backlog to a record. Revenue rose 34% and gross margin reached 47.7% on that mix, chief executive Richard Rogoff said. By our math the plan then halves operating profit next quarter. • Orders: $𝟰𝟵.𝟰𝗠 (+31% from a year ago) • Revenue: $𝟯𝟱.𝟭𝗠 (+34% from a year ago) • Backlog of unfilled orders: $𝟱𝟵.𝟳𝗠 (+32% from June) • Fourth-quarter revenue outlook: $𝟯𝟰–𝟯𝟲𝗠 (middle of the range: up 7% from a year ago) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🟢 Bullish The story got better because orders came back: the shrinking backlog and the margin stuck in the low 40s both got a reading against them, and the new plan sits above what August left for the second half. The bad news: that plan has profit falling back toward last year's fourth-quarter level, and cash went out as receivables rose on flat sales. The question now is whether this quarter's margin was a one-off mix or the level semiconductor work will hold into 2027. Either semiconductor orders ship at their usual higher margin and next year stays near this level, or auto projects return and margin slides toward 40%. The fourth-quarter margin, against a 45% plan, will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢🟢 𝗖𝗵𝗶𝗽𝗺𝗮𝗸𝗲𝗿𝘀 𝗢𝗿𝗱𝗲𝗿𝗲𝗱 𝗧𝗵𝗿𝗲𝗲 𝗧𝗶𝗺𝗲𝘀 𝗮𝘀 𝗠𝘂𝗰𝗵 𝗧𝗲𝘀𝘁 𝗚𝗲𝗮𝗿 InTest sells the manipulators, docking hardware and chillers that sit beside a semiconductor tester, so its orders follow chipmakers' spending on test capacity. That spending ran below what the New Jersey company shipped for two quarters, and its backlog of unfilled orders shrank. This quarter it arrived. Semiconductor orders reached $25.1 million, more than three times a year ago, as makers of power, analog and mixed-signal chips added test capacity. Chief executive Richard Rogoff said that for customers "the constraint has moved from building wafers to packaging and testing finished devices fast enough". • Total orders: $49.4 million, a record and 31% above a year ago • Backlog: $59.7 million, up 32% from June • Backlog due to ship in 2027: about 60%, Rogoff said • Auto/EV (car and electric-vehicle makers) orders: $9.4 million, more than double the second quarter • Defense/Aerospace orders: up 43% from the second quarter, with new customers added This matters because orders fell short of revenue in each of the previous two quarters, so 2027 risked running short of work. Record orders answer that for now, but Rogoff warned order levels "will vary from quarter to quarter with the timing of our customers’ capital investments". What to watch: fourth-quarter orders against this quarter's $49.4 million. Rogoff said the funnel entering the fourth quarter roughly matched the start of the third. A second quarter of orders above revenue would show the cycle has more than one quarter in it. concern eased — 𝗚𝗿𝗼𝘀𝘀 𝗠𝗮𝗿𝗴𝗶𝗻 𝗕𝗲𝗮𝘁 𝗜𝘁𝘀 𝗣𝗹𝗮𝗻 𝗮𝘀 𝗔𝘂𝘁𝗼 𝗣𝗿𝗼𝗷𝗲𝗰𝘁𝘀 𝗙𝗮𝗱𝗲𝗱 Gross margin, what is left of revenue after the cost of making the products, had become InTest's weak spot. It missed the company's own target in three of the previous four quarters, mostly on large low-margin projects at Alfamation, its Italian automotive test unit. This quarter it delivered 47.7%, and the release says all three operating segments improved. The cost of making its products fell to 52.3% of revenue from 58.1% a year ago, because semiconductor work took a larger share of sales while the Auto/EV projects, large jobs for car and electric-vehicle makers, faded. • Plan for the quarter: about 44% • Semiconductor share of revenue: 33%, from 26% in the second quarter • Electronic Test operating margin: 20%, from 9% a year ago • Process Technologies operating margin: 12%, from a small loss One quarter would only soften the concern, because finance chief Duncan Gilmour said "Q3's product mix was particularly favorable". The next plan moves it further: Gilmour set the fourth quarter at about 45%. By our math that puts the full year near 44%, above the 43% the test-equipment maker gave in August. What to watch: fourth-quarter gross margin against the 45% plan. A reading near it would confirm the margin trouble was a project-mix phase at Alfamation rather than the business's normal level. 🟢 𝗖𝗼𝘀𝘁𝘀 𝗚𝗿𝗲𝘄 𝗛𝗮𝗹𝗳 𝗮𝘀 𝗙𝗮𝘀𝘁 𝗮𝘀 𝗦𝗮𝗹𝗲𝘀 Rogoff took over in the first quarter promising to make more of each sales dollar reach profit. This quarter gave a first reading: operating expenses rose 15% while revenue grew 34%, so every cost line fell as a share of sales. That is a fixed cost base meeting more volume, not cuts. • Operating expenses: 39.9% of revenue, from 46.4% a year ago • Selling: 12.8% of revenue, down 1.6 points • Engineering: 7.2%, down 1.7 points • General and administrative: 18.2%, down 1.4 points • Amortization of acquired assets: 1.6%, down 1.6 points The fourth quarter gives some back. Gilmour plans higher operating expenses "as we fill open leadership positions and start planning for 2027", and the cost review Rogoff began has no dollar target yet, so the gain so far is volume rather than a leaner organisation. What to watch: operating expenses as a share of revenue in the fourth quarter; by our math the plan implies about 41%. Holding near 40% on flat revenue would show the leverage is structural rather than one quarter's timing. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗙𝗼𝘂𝗿𝘁𝗵-𝗤𝘂𝗮𝗿𝘁𝗲𝗿 𝗣𝗹𝗮𝗻 𝗛𝗮𝘀 𝗣𝗿𝗼𝗳𝗶𝘁 𝗙𝗮𝗹𝗹𝗶𝗻𝗴 𝗕𝗮𝗰𝗸 "The third quarter demonstrated the earnings power of our business model when demand, mix, and execution line up," Rogoff said. Operating income reached $2.7 million, a 7.8% margin. The test of that claim is the plan Gilmour gave for the next quarter on the same call. • Revenue plan: $34–36 million, level with this quarter at the middle • Gross margin plan: down 2.7 points from this quarter • Operating expense plan: $14.2–14.7 million, from $14.0 million • Operating income implied, by our math: about $1.3 million, half this quarter's At the middle of the range revenue equals this quarter's, so the profit decline is all mix and cost: Gilmour said this quarter's mix was unusually good, and spending rises as InTest fills open leadership jobs. That would put operating income back where it was a year earlier. Rogoff's claim therefore holds only in quarters when the three line up, and the test-equipment maker's own plan says they will not in the fourth. Most of the record backlog ships in 2027, Rogoff said. By our math the quarter therefore needs roughly $11 million of orders InTest still has to win and ship. What to watch: fourth-quarter operating income against the roughly $1.3 million the plan implies. A result near this quarter's level would show the plan, like the revenue plans before it, had room to spare. 🔴 𝗖𝗮𝘀𝗵 𝗪𝗲𝗻𝘁 𝗢𝘂𝘁 𝗮𝘀 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝗣𝗮𝗶𝗱 𝗟𝗮𝘁𝗲𝗿 InTest reported a profit, yet its operations used cash. The reason is working capital: receivables, the money customers owe for goods already shipped, rose $3.6 million from June while revenue was flat. Customer deposits fell $1.0 million even as the backlog grew by a third. • Net earnings: $1.9 million • Cash from operations: minus $0.3 million • Free cash flow: minus $0.6 million, against $3.1 million a year ago • Receivables: 87% of quarterly revenue, from 76% in June • Customer deposits and deferred revenue: $4.9 million, down 17% from June Receivables rising on flat sales means shipments bunched late in the quarter or customers paid more slowly; the materials do not say which. The deposit decline is the odder signal, because customers placed record orders yet paid less upfront than on the smaller orders of the spring. What to watch: cash from operations and the receivables balance in the fourth quarter. Orders booked now would normally bring deposits in, so another decline alongside a rising backlog would mean InTest is financing its customers' capacity build. 🔴 𝗥𝗶𝘀𝗸𝘀 𝗧𝗵𝗶𝘀 𝗤𝘂𝗮𝗿𝘁𝗲𝗿 𝗗𝗶𝗱𝗻'𝘁 𝗔𝗻𝘀𝘄𝗲𝗿 Four standing concerns got no new numbers in the release or on the call, and three of them live in the quarterly filing InTest said it would file after the market closed, which was not available for this article. • Customer concentration: one customer was 24% of second-quarter revenue; the release does not name it or update the share, so the filing's major-customer note will show it. • Control weakness at Alfamation: the release still lists it as a risk; management said in August the fix would be proven by year-end, so the fourth-quarter report settles it. • Length of the semiconductor upturn: Rogoff sees demand running "into the early part of 2027, at least" and does not expect the front end to "come back to what it did 3 or 4 years ago"; first-half 2027 orders will show whether it extends. • Supply chain: the release says lead times are expanding and Gilmour called it "nothing that we can't manage"; a shipment slip, which has hit four of the last nine quarters, would show otherwise. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗡𝗲𝘄𝗲𝗿 𝗣𝗿𝗼𝗱𝘂𝗰𝘁𝘀 𝗪𝗼𝗻 𝗮 𝗦𝗵𝗮𝗿𝗲 𝗼𝗳 𝗦𝗲𝗺𝗶 𝗢𝗿𝗱𝗲𝗿𝘀 Rogoff said InTest's "high-powered chillers and other advanced test products" captured "a meaningful portion of our new orders", because advanced chips run hotter and need more cooling during test. Its flying probe systems, built to check circuit boards, now also run battery tests, and a chiller that meets Europe's new refrigerant rules launches next week. None of these carries a revenue figure yet. 𝗥𝗼𝗴𝗼𝗳𝗳'𝘀 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗣𝗹𝗮𝗻 𝗛𝗮𝘀 𝗮 𝗟𝗲𝗮𝗱𝗲𝗿 𝗯𝘂𝘁 𝗡𝗼 𝗧𝗮𝗿𝗴𝗲𝘁 Rogoff said InTest's next phase is to "operate our business as a coordinated platform, capturing commercial opportunities, cost synergies and the sharing of ideas", after years in which acquired units ran separately. Scott Taylor joined on October 1 as general manager of ITS, the thermal unit inside Environmental Technologies, to execute it. The plan still has no savings figure or facility decision; the 2027 outlook in February is the next chance to hear one. 𝗔𝗜 𝗗𝗮𝘁𝗮 𝗖𝗲𝗻𝘁𝗲𝗿𝘀 𝗔𝗿𝗲 𝗣𝘂𝗹𝗹𝗶𝗻𝗴 𝗧𝗲𝘀𝘁 𝗢𝗿𝗱𝗲𝗿𝘀 𝗙𝗼𝗿𝘄𝗮𝗿𝗱 InTest ties the semiconductor capacity build to power and communications chips, "fueled in part by AI-driven data center demand". Because "lead times for test equipment lengthened and customers placed orders earlier", Rogoff said visibility is better than usual, though lead times are stretching at InTest's own suppliers too. Outside chips, Auto/EV (car and electric-vehicle) orders recovered as model launches returned to a normal schedule after the 2024–2025 electric-vehicle slowdown. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗗𝗶𝗹𝘂𝘁𝗲𝗱 𝘀𝗵𝗮𝗿𝗲 𝗰𝗼𝘂𝗻𝘁 (𝟮𝟲𝗤𝟯): 𝟭𝟮.𝟲 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Up 3.3% from a year ago, because employees exercised options for $3.5 million in the first nine months. Each percentage point of extra shares takes about a point off profit per share, with no buybacks to offset it. The count has grown for five straight quarters. 𝗧𝗼𝘁𝗮𝗹 𝗱𝗲𝗯𝘁 (𝟮𝟲𝗤𝟯): $𝟱.𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Down $1.0 million in the quarter as InTest kept paying off its term loan from cash. It holds $20.9 million of cash and can borrow $40 million more. The draw period on the term facility now runs to August 2028, two years longer than before. Leverage is 0.5 times trailing adjusted EBITDA, from 0.8 in June. 𝗜𝗻𝘃𝗲𝗻𝘁𝗼𝗿𝘆 (𝟮𝟲𝗤𝟯): $𝟮𝟴.𝟮 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable Flat from June and down 11% since December, while quarterly revenue rose 7% over the same period. It now equals about 81% of a quarter's sales, the lowest of the year. At year-end the figure was 96%, before the Alfamation stock overstatement was corrected. Gilmour said longer lead times may need a little more working capital. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗤𝟰 𝗥𝗲𝘃𝗲𝗻𝘂𝗲: $𝟯𝟰.𝟬–𝟯𝟲.𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating 🠅 raised from $135–140 million full-year outlook (August), which by our math left $32.8–35.8 million for the fourth quarter Raised, by our math: the range sits above what the August full-year plan left for the fourth quarter. The middle is 6.6% above a year ago and level with this quarter. The year-ago quarter carried about $2 million of shipments that slipped from the third, so the comparison is hard. InTest has beaten the top of its quarterly range four quarters running; if the pattern holds, revenue lands near $36.9 million. 𝗤𝟰 𝗚𝗿𝗼𝘀𝘀 𝗺𝗮𝗿𝗴𝗶𝗻: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 𝟰𝟱% ⇘ decelerating 🠅 raised from about 43% full-year outlook (August), which by our math needed about 44% in the second half Raised against what the August plan implied, which needed about 44% for the second half. The new 45% is 2.7 points below this quarter, because Gilmour said the mix was unusually favorable and the fourth quarter will shift a little away from it. By our math the full year lands near 44%, above the 43% InTest set in August. It missed its margin plan in three of the previous four quarters, so this one still needs delivering. 𝗤𝟰 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗲𝘅𝗽𝗲𝗻𝘀𝗲𝘀: $𝟭𝟰.𝟮–𝟭𝟰.𝟳 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating 🠅 raised from $55–57 million full-year outlook (August), which by our math left $12.6–14.6 million for the fourth quarter Raised: by our math the full-year total now comes to $56.6–57.1 million, at or just above the top of the $55–57 million plan InTest held all year. The middle of the range is 3.3% above this quarter, to pay for new leadership hires and next year's planning, Gilmour said. Set against the revenue and margin plans, it leaves operating income of roughly $1.3 million at the middle, about half this quarter's. 𝗤𝟰 𝗔𝗺𝗼𝗿𝘁𝗶𝘇𝗮𝘁𝗶𝗼𝗻 𝗼𝗳 𝗮𝗰𝗾𝘂𝗶𝗿𝗲𝗱 𝗶𝗻𝘁𝗮𝗻𝗴𝗶𝗯𝗹𝗲𝘀: $𝟬.𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating 🠆 unchanged from $2.6 million full-year outlook (August) Unchanged in effect: $0.5 million for the quarter puts the year near $2.5 million. That is a touch under the full-year plan, as older acquired assets finish amortizing. It is a non-cash charge on assets from past acquisitions, so it lowers reported profit but not cash. 𝗙𝗬𝟮𝟲 𝗥𝗲𝘃𝗲𝗻𝘂𝗲: 𝗵𝗶𝗴𝗵 𝗲𝗻𝗱 𝗼𝗳 $𝟭𝟯𝟱–𝟭𝟰𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable 🠆 unchanged from $135–140 million Unchanged, and now pointed at the top. By our math the fourth-quarter range puts the year at $138–140 million, about 22% above 2025. The plan has moved three times, each step smaller than the last. It rose $5 million in May and again in August, and now moves to its high end. 𝗙𝗬𝟮𝟲 𝗘𝗳𝗳𝗲𝗰𝘁𝗶𝘃𝗲 𝘁𝗮𝘅 𝗿𝗮𝘁𝗲: 𝗮𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 𝟮𝟬% ⇗ accelerating 🠅 raised from approximately 18% Raised. Gilmour now expects about 20% for the year, from 18%, because of "a higher proportion of profitability being generated in our higher tax jurisdictions". This quarter's rate alone was 30%. At the old rate, profit per share would have been about $0.03 higher by our math. The year-to-date figure still includes a one-off benefit booked in the second quarter. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗪𝗵𝗼 𝗶𝘀 𝘁𝗵𝗲 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝘁𝗵𝗮𝘁 𝘄𝗮𝘀 𝟮𝟰% 𝗼𝗳 𝗿𝗲𝘃𝗲𝗻𝘂𝗲? One customer took 24% of second-quarter revenue. The release does not name it or update the share, and with Auto/EV revenue halving, whether that customer's orders sit in the record backlog decides how lumpy 2027 will be. 𝗪𝗵𝗮𝘁 𝗺𝗮𝗿𝗴𝗶𝗻 𝗱𝗼𝗲𝘀 𝘁𝗵𝗲 𝘀𝗲𝗺𝗶𝗰𝗼𝗻𝗱𝘂𝗰𝘁𝗼𝗿 𝗯𝗮𝗰𝗸𝗹𝗼𝗴 𝗰𝗮𝗿𝗿𝘆 𝗶𝗻𝘁𝗼 𝟮𝟬𝟮𝟳? Roughly 60% of the $59.7 million backlog ships next year, much of it semiconductor work, which Gilmour calls InTest's highest-margin lines. A market split of the backlog would show whether 2027 margin starts nearer 45% or 40%. 𝗜𝘀 𝘁𝗵𝗲 $𝟮𝟬𝟬–𝟮𝟱𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝟮𝟬𝟮𝟳 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝘁𝗮𝗿𝗴𝗲𝘁 𝘄𝗶𝘁𝗵𝗱𝗿𝗮𝘄𝗻? The previous chief executive reaffirmed that target in early 2025; no call since has mentioned it. From roughly $139 million this year it would need growth above 40% next year, so management should say whether VISION 2030 replaced it. 𝗪𝗵𝘆 𝗱𝗶𝗱 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗱𝗲𝗽𝗼𝘀𝗶𝘁𝘀 𝗳𝗮𝗹𝗹 𝘄𝗵𝗶𝗹𝗲 𝗼𝗿𝗱𝗲𝗿𝘀 𝘀𝗲𝘁 𝗮 𝗿𝗲𝗰𝗼𝗿𝗱? Deposits and deferred revenue fell 17% from June as the backlog grew 32%. Either payment terms changed on the large semiconductor orders or shipments ran ahead of billing; the answer sets how much cash the 2027 build will tie up. 𝗛𝗮𝘀 𝘁𝗵𝗲 𝗔𝗹𝗳𝗮𝗺𝗮𝘁𝗶𝗼𝗻 𝗰𝗼𝗻𝘁𝗿𝗼𝗹 𝘄𝗲𝗮𝗸𝗻𝗲𝘀𝘀 𝗯𝗲𝗲𝗻 𝗳𝗶𝘅𝗲𝗱? Management committed in August to show the controls working by year-end. The release still lists the weakness as a risk and the call did not mention it, so the fourth-quarter report is the deadline.

$AQN Q3 2026 earnings: Weather lifts Algonquin's profit, but its wildfire costs keep rising Algonquin earned more this quarter, but favourable summer weather in Missouri did the work rather than its new rates. Finance chief Rob Stefani credited rates and weather together. His own bridge puts weather at $0.02 a share, the whole of the gain. The year's outlook is unchanged, so by our math the fourth quarter must earn $0.07–0.09 a share. • Profit per share, excluding one-offs: $𝟬.𝟭𝟭 ($0.09 a year ago; weather added $0.02) • Revenue: $𝟲𝟰𝟮.𝟱𝗠 (+10% from a year ago) • Wildfire costs this quarter: $𝟭𝟲.𝟲𝗠 ($33.8M so far this year, all excluded from adjusted profit) • Full-year profit outlook: 𝗨𝗻𝗰𝗵𝗮𝗻𝗴𝗲𝗱 ($0.35–0.37 a share; by our math the fourth quarter needs $0.07–0.09) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: ⚪ Neutral The story is unchanged, because the quarter matched the pace the full-year plan implied and weather supplied the margin. The good news: Missouri's rates reached only two months of the quarter, the Chilean sale closed, and the cash-flow-to-debt ratio moved away from the downgrade line. The bad news: California added $16.6 million of unrecoverable fire costs, and regulators there proposed a penalty on top. The question now is whether earnings keep rising once the weather turns ordinary. Either a full quarter of Missouri rates carries the fourth quarter, or flat running costs and fire charges eat the gain. The fourth-quarter results in March will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢🟢 𝗡𝗲𝘄 𝗥𝗮𝘁𝗲𝘀 𝗛𝗮𝘃𝗲 𝗦𝘁𝗮𝗿𝘁𝗲𝗱 𝘁𝗼 𝗟𝗶𝗳𝘁 𝗨𝘁𝗶𝗹𝗶𝘁𝘆 𝗘𝗮𝗿𝗻𝗶𝗻𝗴𝘀 Algonquin earns most of its money from regulated utilities, where regulators set the prices customers pay. The utility group's adjusted earnings rose to $101.0 million from $95.7 million, because four rate decisions have taken effect since spring. Missouri's Empire Electric began charging new rates on August 3, so the quarter caught only two months of a $97 million annual increase. The rest arrives from October. By our math a full quarter adds about $24 million, roughly double the $11.2 million booked. • Net rate relief: $11.4 million, after higher wildfire insurance and a timing gap in Massachusetts gas revenue • CalPeco, its California electric utility: $12.1 million from new rates • Litchfield Park water and sewer in Arizona: $14.9 million a year approved, effective September 1 Not every decision went its way. Arizona set Litchfield Park's return at 9.4%, below the settlement's 9.75%. New York looks harder. Staff there countered the water utility's $37.6 million request with $12.6 million, and settlement talks pushed the decision to next summer. What to watch: Missouri's contribution in the fourth quarter, the first with three full months of new rates. A figure near $24 million would mean the rate case is delivering what the outlook needs. 🟢 𝗦𝗲𝗹𝗹𝗶𝗻𝗴 𝘁𝗵𝗲 𝗖𝗵𝗶𝗹𝗲𝗮𝗻 𝗨𝘁𝗶𝗹𝗶𝘁𝘆 𝗣𝗮𝘆𝘀 𝗗𝗼𝘄𝗻 𝗗𝗲𝗯𝘁 Algonquin owned 64% of Suralis, a water utility in Chile that brought in about 4% of regulated revenue. Chief executive Rod West wants a simpler portfolio, and the sale, he said, is "further simplifying our portfolio and enabling the prospect of capital recycling into our regulated utility businesses". The deal moved fast: the group signed it on August 28 and closed it on October 30. It received $126.4 million, and $204.7 million of Suralis debt left the balance sheet with the business. It also booked an $8.3 million loss to mark the business down to the sale price, outside adjusted earnings. Finance chief Rob Stefani called the sale "slightly credit positive on a forward-looking basis" and said a tax benefit makes it roughly neutral to this year's earnings. The utility has not disclosed how much Chilean profit it gives up, so the test is whether next year's outlook holds without it. What to watch: the 2027 outlook at the fourth-quarter results in March. An unchanged $0.38–0.42 range would mean the debt saving covers the lost Chilean earnings. 🟢 𝗥𝗲𝗱𝗼𝗺𝗶𝗰𝗶𝗹𝗲 𝗚𝗮𝗶𝗻𝘀 𝗮 𝗗𝗮𝘁𝗲 𝗮𝗻𝗱 𝗮 𝗣𝗮𝘆𝗼𝗳𝗳 Algonquin is incorporated in Canada but runs over 80% of its operations in the United States, so dividends and interest crossing the border attract extra tax. It plans to move its incorporation to Delaware and now targets completion in the first half of 2027. "We estimate an annualized adjusted net EPS benefit of $0.02 to $0.03 per share with a partial benefit beginning in 2027," finance chief Rob Stefani said. Set against the $0.38–0.42 outlook for next year, a full year of savings is worth about 6% of profit by our math. The missing number is the cost. The move triggers a one-time Canadian exit tax and a US toll charge, and Stefani has not yet put a range on either, pending an IRS private letter ruling the company says is "progressing as expected". What to watch: the shareholder circular due in the first half of 2027, which must state the one-time tax cost. Only that number shows whether a few years of savings repay the move. 🟢 𝗣𝗼𝘀𝗶𝘁𝗶𝘃𝗲𝘀 𝘁𝗵𝗶𝘀 𝗾𝘂𝗮𝗿𝘁𝗲𝗿 𝗱𝗶𝗱𝗻'𝘁 𝘁𝗲𝘀𝘁 Three growth items advanced on paper this quarter, but none of them produced a revenue, customer or capital figure that the numbers can test yet. • Missouri large-load tariff: filed September 11 "to support economic development and large-load investment while protecting residential and small-business customers"; chief executive Rod West called it "the first public signal toward that end" and named no customer. Commission approval is the next reading. • SPP transmission projects: FERC agreed on August 31 to let Empire earn on construction spending before the lines operate and to recover costs if projects are abandoned. The dollar size of Empire's share is still undisclosed, and the projected-test-year request is pending. • New rate cases: Oklahoma asks $7.0 million and New Hampshire's Granite State $12.3 million, with hearings in February and decisions during 2027. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗪𝗲𝗮𝘁𝗵𝗲𝗿, 𝗡𝗼𝘁 𝗥𝗮𝘁𝗲𝘀, 𝗗𝗲𝗹𝗶𝘃𝗲𝗿𝗲𝗱 𝘁𝗵𝗲 𝗛𝗶𝗴𝗵𝗲𝗿 𝗣𝗿𝗼𝗳𝗶𝘁 "Our third quarter was solid, helped by new rates in multiple jurisdictions as well as favorable weather," finance chief Rob Stefani said. His own bridge tells a narrower story. Weather contributed $0.02 a share, which is the entire increase. New rates added $0.01, and higher operating and depreciation costs took that $0.01 back. The weather showed up in Missouri's electricity use. Residential customers of Empire Electric used 14% more power than a year earlier, and the group's electricity sales net of fuel rose 17%. Gas use fell 2% because the autumn was mild, so gas earnings slipped. This matters because Stefani held the outlook rather than raising it, even with a $0.02 tailwind. By our math adjusted earnings landed within 1% of the pace the full-year plan implied, so the plan absorbed the weather rather than beating it. Strip it out and profit per share stood at $0.09, equal to a year ago. What to watch: the fourth quarter, which by our math needs $0.07–0.09 a share against $0.06 last year, with a full quarter of Missouri rates and no summer heat to lean on. Earning that range without weather would show the rate increases are doing the work. 🔴🔴 𝗧𝗵𝗲 𝗪𝗶𝗹𝗱𝗳𝗶𝗿𝗲 𝗕𝗶𝗹𝗹 𝗞𝗲𝗲𝗽𝘀 𝗚𝗿𝗼𝘄𝗶𝗻𝗴 CalPeco, Algonquin's electric utility in California, is still paying for the 2020 Mountain View Fire. It has settled all 22 lawsuits, but California regulators decide how much of the cost customers cover, and that answer is still pending. This quarter brought $16.6 million of "non-recoverable costs and additional accruals", taking the year's fire charges to $33.8 million. All of it sits outside adjusted earnings. In June a judge proposed letting CalPeco recover 75% of its request, spread over five years rather than three. Then on September 28 the commission's safety division proposed a further $16.0 million penalty for alleged breaches of overhead-line safety rules. CalPeco called the penalty "unsubstantiated, excessive, and unlawful" and asked for a hearing. Wildfire insurance also costs $5.5 million more than a year ago, although rates now recover it. Why it matters: the outlook counts none of these charges, so adjusted profit looks steady while cash leaves the business. Each new accrual also tests how much of the $178.4 million total loss customers will ultimately fund. What to watch: the commission's vote on the cost recovery, scheduled for November 19, and the penalty hearing. A vote at 75% or lower, plus a penalty, would mean the fire's cost keeps landing on shareholders. 🔴 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗖𝗼𝘀𝘁𝘀 𝗔𝗿𝗲 𝗡𝗼𝘁 𝗙𝗮𝗹𝗹𝗶𝗻𝗴 𝗮𝘀 𝗣𝗹𝗮𝗻𝗻𝗲𝗱 Algonquin's turnaround depends on spending less to run its utilities. Finance chief Rob Stefani targets operating costs in the low-to-mid 30s as a share of revenue, and pointed to outsourcing and software rationalisation, saying "there's opportunities to continue to take cost out". The nine-month ratio has not moved: operating expenses took 34.5% of revenue, against 34.4% a year earlier. The quarter looked better. Costs fell to 34.4% of revenue, down 1.2 points, but only because weather added revenue while spending kept climbing. Gas operating costs rose $4.4 million on safety work and labour, and depreciation rose 13% as new plant entered service. Stefani said severance and consulting costs for the programme sit outside adjusted earnings but inside the operating line, which is why the ratio does not yet show savings. He expects to "bend that cost curve back". Operating margin nonetheless slipped 0.5 points to 25.2%. What to watch: the full-year ratio of operating cost to revenue at the fourth-quarter results, against 35.8% last year. A reading above that would mean the restructuring spending is not yet buying lower running costs. 🔴 𝗗𝗲𝗯𝘁 𝗜𝘀 𝗥𝗶𝘀𝗶𝗻𝗴 𝗔𝗵𝗲𝗮𝗱 𝗼𝗳 𝘁𝗵𝗲 𝗦𝗽𝗲𝗻𝗱𝗶𝗻𝗴 𝗥𝗮𝗺𝗽 Algonquin funds a growing capital plan while holding a BBB rating, and the number its rating agency watches is cash flow relative to debt. That ratio improved to 12.2% over the last twelve months, from 11.9% a quarter earlier. The downgrade line, by the company's estimate, sits near 11%. The improvement came from cash flow, not less debt. Commercial paper, the short-term borrowing the utilities use between bond deals, grew to $564 million from $337 million at year-end. Bonds did not fall either. Debt on the rating agency's measure rose 3% to $5.9 billion. The Chilean sale helps, because its debt leaves with it, and finance chief Rob Stefani called it "slightly credit positive on a forward-looking basis". But the capital plan steps up next year and again in 2028, and the group has pledged to issue no shares through 2027, so new borrowing is the only source. What to watch: the same ratio at year-end, after the fourth quarter's heavier spending. Holding above 12% would show the plan is fundable with debt alone for now. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗖𝗮𝗹𝗶𝗳𝗼𝗿𝗻𝗶𝗮 𝗖𝗼𝘂𝗿𝘁 𝗕𝗮𝗰𝗸𝘀 𝗟𝗶𝗯𝗲𝗿𝘁𝘆 𝗶𝗻 𝗔𝗽𝗽𝗹𝗲 𝗩𝗮𝗹𝗹𝗲𝘆 𝗖𝗮𝘀𝗲 The Town of Apple Valley has tried since 2016 to take Liberty's local water system by eminent domain. On August 24 the California Supreme Court reversed an appeal ruling that had gone the town's way and sent the case back under a standard that lets Liberty rebut the town's claims at trial. The case continues, but Liberty now defends it on better legal terms. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗲𝘅𝗽𝗲𝗻𝗱𝗶𝘁𝘂𝗿𝗲𝘀 (𝟮𝟲𝗤𝟯): $𝟮𝟬𝟳.𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Spending rose 40% from a year ago, after falling in the first quarter, a swing the company says is "mainly due to the timing of capital expenditures incurred". Nine months total $448.4 million, 56% of the full-year plan. That leaves the heaviest quarter for last. By our math the fourth quarter needs about $352 million, 60% above the same quarter last year. 𝗜𝗻𝘁𝗲𝗿𝗲𝘀𝘁 𝗲𝘅𝗽𝗲𝗻𝘀𝗲 (𝟮𝟲𝗤𝟯): $𝟳𝟲.𝟲 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Up 7% from a year ago but a touch below last quarter's $77.1 million, so the rise is slowing after June's refinancing moved $1.15 billion of notes from the parent to the utility subsidiary. Utility interest rose $21.8 million and parent interest fell $16.9 million; commercial paper costs climbed with higher balances. 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗰𝗮𝘀𝗵 𝗳𝗹𝗼𝘄 (𝟮𝟲𝗤𝟯): $𝟭𝟴𝟳.𝟴 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Nearly double a year ago, mostly because working capital released cash: receivables fell to $359 million from $461 million at year-end as unbilled amounts shrank. For nine months cash from operations is up 22%. One caution: the allowance for customer bills the group may never collect rose to $41.0 million from $31.1 million. 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗰𝗼𝗻𝗻𝗲𝗰𝘁𝗶𝗼𝗻𝘀 (𝟮𝟬𝟮𝟲-𝟬𝟵-𝟯𝟬): 𝟭,𝟯𝟭𝟴,𝟬𝟬𝟬 ⇒ stable Up 21,300, or 1.6%, from a year earlier. All three commodities grew. Electric connections reached 343,000 and water and wastewater 594,000; the water figure still includes the Chilean utility sold in October, so the next count drops. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗙𝗬𝟮𝟬𝟮𝟲 𝗮𝗱𝗷𝘂𝘀𝘁𝗲𝗱 𝗽𝗿𝗼𝗳𝗶𝘁 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲: $𝟬.𝟯𝟱–𝟬.𝟯𝟳 ⇒ stable 🠆 unchanged from $0.35–0.37 Unchanged. The middle of the range is $0.36, about 6% above last year. Nine months finished level with 2025. By our math the fourth quarter must earn $0.07–0.09 against $0.06 a year ago, with a full quarter of Missouri rates helping. The range has now held for four quarters, and last year's result finished above the top of its own range. 𝗙𝗬𝟮𝟬𝟮𝟳 𝗮𝗱𝗷𝘂𝘀𝘁𝗲𝗱 𝗽𝗿𝗼𝗳𝗶𝘁 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲: $𝟬.𝟯𝟴–𝟬.𝟰𝟮 ⇗ accelerating 🠆 unchanged from $0.38–0.42 Unchanged. The middle of the range, $0.40, implies 11% growth over the middle of this year's range. Finance chief Rob Stefani kept it after selling the Chilean utility, which earned part of the profit, and said the redomicile adds a partial benefit from 2027. Management trimmed the range by about $0.03 a year ago for a higher tax rate and has held it since. 𝟮𝟬𝟮𝟲 𝘂𝘁𝗶𝗹𝗶𝘁𝘆 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝗲𝘅𝗽𝗲𝗻𝗱𝗶𝘁𝘂𝗿𝗲𝘀: 𝗔𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 $𝟬.𝟴 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating 🠆 unchanged from Approximately $0.8 billion Unchanged. Nine months of spending reached $448 million, so the plan needs about $352 million in the fourth quarter by our math, more than any quarter this year. The company says quarter-to-quarter swings reflect timing. A shortfall would leave year-end rate base below the $8.5 billion the plan assumes. 𝟮𝟬𝟮𝟲–𝟮𝟬𝟮𝟴 𝗮𝗴𝗴𝗿𝗲𝗴𝗮𝘁𝗲 𝘂𝘁𝗶𝗹𝗶𝘁𝘆 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝗲𝘅𝗽𝗲𝗻𝗱𝗶𝘁𝘂𝗿𝗲𝘀: 𝗔𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 $𝟯.𝟮 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable 🠆 unchanged from Approximately $3.2 billion Unchanged. The plan steps up each year, reaching about $1.3 billion in 2028, with electric systems taking just over half. Nothing this quarter changed the total. The Chilean utility's future spending leaves with the sale, and Algonquin has not said whether the total shrinks to match. 𝗥𝗮𝘁𝗲 𝗯𝗮𝘀𝗲 𝗴𝗿𝗼𝘄𝘁𝗵, 𝟮𝟬𝟮𝟱–𝟮𝟬𝟮𝟴: 𝟱%–𝟲% 𝗰𝗼𝗺𝗽𝗼𝘂𝗻𝗱 𝗮𝗻𝗻𝘂𝗮𝗹 𝗴𝗿𝗼𝘄𝘁𝗵 ⇗ accelerating 🠆 unchanged from 5%–6% compound annual growth Unchanged. Rate base, the invested capital regulators let the utilities earn on, grows from about $8.2 billion to $9.7 billion by the end of the plan. The path is back-loaded: about 3% this year by our math, and faster in each of the two years after, as transmission and generation projects enter the base. Fourth-quarter spending decides whether this year's step arrives. 𝗖𝗼𝗺𝗺𝗼𝗻 𝗱𝗶𝘃𝗶𝗱𝗲𝗻𝗱, 𝗮𝗻𝗻𝘂𝗮𝗹𝗶𝘇𝗲𝗱: $𝟬.𝟮𝟲 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲 ($𝟬.𝟬𝟲𝟱 𝗾𝘂𝗮𝗿𝘁𝗲𝗿𝗹𝘆) ⇒ stable 🠆 unchanged from $0.26 per share Unchanged. The board declared $0.065 for the fourth quarter, payable in January. The payout stays high. Over nine months dividends took about 70% of adjusted profit, so there is little room to raise it until earnings do, and the plan assumes no new shares through 2027. 𝗥𝗲𝗱𝗼𝗺𝗶𝗰𝗶𝗹𝗲 𝗲𝗮𝗿𝗻𝗶𝗻𝗴𝘀 𝗯𝗲𝗻𝗲𝗳𝗶𝘁, 𝗮𝗻𝗻𝘂𝗮𝗹𝗶𝘇𝗲𝗱: $𝟬.𝟬𝟮–𝟬.𝟬𝟯 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲, 𝗽𝗮𝗿𝘁𝗶𝗮𝗹 𝗯𝗲𝗻𝗲𝗳𝗶𝘁 𝗳𝗿𝗼𝗺 𝟮𝟬𝟮𝟳 ⇒ stable 🠆 unchanged from About $0.02–0.025 per share, possibly slightly more Confirmed. Finance chief Rob Stefani now puts the recurring saving at $0.02–0.03 a share, with part arriving in 2027 if shareholders and regulators approve the move in the first half. The one-time exit tax remains unquantified, so the net benefit stays unknown. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝘄𝗶𝗹𝗹 𝘁𝗵𝗲 𝗿𝗲𝗱𝗼𝗺𝗶𝗰𝗶𝗹𝗲 𝗲𝘅𝗶𝘁 𝘁𝗮𝘅 𝗰𝗼𝘀𝘁? Stefani now quantifies the recurring saving at $0.02–0.03 a share but still gives no range for the one-time Canadian exit tax and US toll charge. Without it, nobody can say how many years of savings the move consumes. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗼𝗳 𝘁𝗵𝗲 $𝟵𝟳 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝗶𝘀 𝗶𝗻 𝗠𝗶𝘀𝘀𝗼𝘂𝗿𝗶 𝗿𝗮𝘁𝗲𝘀 𝘁𝗼𝗱𝗮𝘆? The settlement phases the increase over three years. Two months produced $11.2 million, below a straight monthly share, and Stefani said "you'd have about half of that available for this year" of the extra $13.7 million. The split between phasing and seasonality decides the fourth quarter. 𝗪𝗵𝗮𝘁 𝗿𝗲𝗽𝗹𝗮𝗰𝗲𝘀 𝗖𝗮𝗹𝗣𝗲𝗰𝗼'𝘀 𝗽𝗼𝘄𝗲𝗿 𝘀𝘂𝗽𝗽𝗹𝘆 𝗳𝗿𝗼𝗺 𝗠𝗮𝘆 𝟮𝟬𝟮𝟳? The California utility's supply contract with NV Energy ends in May 2027. Nobody raised it on the call. The cost and timing of replacement power will shape California earnings next year. 𝗪𝗵𝗲𝗿𝗲 𝗱𝗼𝗲𝘀 𝘁𝗵𝗲 𝗰𝗮𝘀𝗵-𝗳𝗹𝗼𝘄-𝘁𝗼-𝗱𝗲𝗯𝘁 𝗿𝗮𝘁𝗶𝗼 𝗲𝗻𝗱 𝘁𝗵𝗲 𝘆𝗲𝗮𝗿? The ratio reached 12.2% with three quarters of spending behind it, but the fourth quarter carries the heaviest capital outlay by our math and the Chilean proceeds only partly offset it. A year-end figure, and the plan if it nears 11%, would settle the equity question. 𝗪𝗵𝗮𝘁 𝗵𝗮𝘀 𝘁𝗵𝗲 𝗰𝗼𝘀𝘁 𝗽𝗿𝗼𝗴𝗿𝗮𝗺𝗺𝗲 𝘀𝗮𝘃𝗲𝗱 𝘀𝗼 𝗳𝗮𝗿? Restructuring charges reached $36.6 million for nine months, all excluded from adjusted profit, while the operating-cost ratio stayed flat. Stefani named outsourcing and software rationalisation but gave no savings figure. A savings number by bucket would show whether the spending buys a lower run-rate.

$TTGT Q3 2026 earnings: Informa TechTarget cuts profit plan, but big clients order more Informa TechTarget's biggest customers order more, but most of its market holds back and its profit plan drops. Revenue fell 3% while content and data costs rose. Chief executive Gary Nugent said the sales pipeline is "converting more slowly than we anticipated", so the company cut its full-year profit range by $15 million and now expects sales slightly below last year. • Revenue: $𝟭𝟭𝟵.𝟮𝗠 (-2.5% from a year ago) • Adjusted EBITDA (operating profit before write-downs and one-off costs): $𝟭𝟴.𝟲𝗠 (-18% from a year ago) • Contract liabilities (cash billed for work not yet delivered): $𝟲𝟮.𝟬𝗠 (-7% from a year ago) • Full-year adjusted EBITDA outlook: 𝗖𝘂𝘁 $𝟭𝟱𝗠 (middle of the range: $82.5M, 6% below last year) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🔴 Bearish The story got worse because the second-half recovery the old plan relied on did not arrive, and the cut concedes it. Contract liabilities fell 7% from a year ago, so less of the fourth quarter is billed in advance. The good news: bookings from the largest clients rose by double digits and the audience keeps growing, so the parts Nugent is investing in are moving even while customers around them pause. The question now is whether customers are pausing or leaving. Either they resume marketing spending once their AI products ship, as Nugent argues, or the buyer research behind the intent data moves to answer engines for good. Fourth-quarter intent data revenue and the 2027 outlook will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢 𝗜𝗻𝘁𝗲𝗻𝘁 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝗔𝗱𝗼𝗽𝘁 𝗡𝗲𝘄 𝗔𝗜 𝗧𝗼𝗼𝗹𝘀 Informa TechTarget sells intent data: records of which technology buyers are researching which products. That business has been shrinking, and chief executive Gary Nugent said AI is giving customers "reason to pause". In the third quarter the company launched Buyer Intelligence, a new version of the intent product with three built-in AI features. The new features write pitch notes and buyer profiles from the signals the group collects. Nugent said "over 40% of our users have embraced these new features", and sellers who use them spend nearly twice as long in the platform per session. A new integration framework also lets clients pull the data into their own AI tools, with Demandbase access planned for January. Adoption matters because intent revenue is still the weak spot: the quarterly filing again cites "declines in Intent Data revenue" inside the marketing segment. But Nugent told analysts that intent bookings improved in the quarter and that customers now buy both the portal and the data feed. Bookings lead revenue, so the product may stop shrinking before the revenue line shows it. What to watch: whether the fourth-quarter filing still names intent data as a cause of lower marketing revenue. A clean quarter there would show the improved bookings reaching the revenue line rather than staying in the order book. 🟢 𝗟𝗮𝗿𝗴𝗲𝘀𝘁 𝗖𝗹𝗶𝗲𝗻𝘁𝘀 𝗢𝗿𝗱𝗲𝗿 𝗠𝗼𝗿𝗲 𝗮𝗻𝗱 𝗕𝗼𝗼𝗸 𝟮𝟬𝟮𝟳 𝗘𝗮𝗿𝗹𝘆 Informa TechTarget has spent the year aiming its sales teams at its biggest customers, selling them research, media and marketing programmes together. Nugent said that focus produced "double-digit bookings growth from this cohort in Q3", as the group cross-sold into new business units and regions. He gave no revenue figure for the cohort, and total sales still fell. The timing of orders also moved. Nugent said some clients now plan only about 90 days ahead, but others began committing to next year: the "backlog of orders for 2027" rose during the quarter, earlier than in past years. The group also hosted its first North American client conference, STRATA, with over 50 of its largest customers in the room. This matters because large-account bookings are the one demand measure that grew, so they are the base for any return to growth next year. But those bookings did not stop third-quarter revenue falling, and management attributed the shortfall to slower conversion of the wider pipeline, which the biggest accounts do not control. What to watch: a revenue growth figure for the largest-client cohort on the fourth-quarter call, which the company last gave a year ago. A number near the bookings rate would show the focus is lifting sales, not just orders. 🟢 𝗔𝘂𝗱𝗶𝗲𝗻𝗰𝗲 𝗚𝗿𝗼𝘄𝘀 𝗪𝗵𝗶𝗹𝗲 𝗦𝗲𝗮𝗿𝗰𝗵 𝗧𝗿𝗮𝗳𝗳𝗶𝗰 𝗦𝘁𝗲𝗮𝗱𝗶𝗲𝘀 Informa TechTarget earns its money from an audience: readers who register on its technology sites and whose research activity it sells as intent data. AI answer engines threaten that model because they answer a question before the reader reaches a site. Nugent has argued for seven quarters that trusted editorial content gains value in that world. This quarter the numbers moved his way. Audience membership rose to over 59 million, a mid-single-digit gain from a year ago, and Nugent said search traffic began to stabilise and now converts visitors to members at a higher rate. Active membership on the Dive sites, which reach readers by email rather than waiting for search, grew by double digits. A larger audience matters because, as Nugent put it, "our company does not monetize traffic"; it sells access to members. But the other side of the argument still stands: intent data revenue fell again, and customers are pausing spending while they work out what AI means for their marketing. More members did not yet mean more revenue. What to watch: intent data revenue and the membership figure together in the fourth quarter. Membership growth with intent revenue still falling would mean the audience is holding but customers are not paying for the signals it produces. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗧𝗵𝗲 𝗣𝗿𝗼𝗳𝗶𝘁 𝗣𝗹𝗮𝗻 𝗙𝗮𝗹𝗹𝘀 $𝟭𝟱 𝗠𝗶𝗹𝗹𝗶𝗼𝗻 Three months ago Informa TechTarget still promised revenue growth this year and adjusted EBITDA, its measure of operating profit before write-downs and one-off costs, of $95–100 million. That plan needed a far stronger second half than the first half delivered. Finance chief Dan Noreck has now cut the profit range to $80–85 million and said revenue will be "modestly lower than the prior year". The cut came even though the release calls the pipeline "strong and growing". Nugent's explanation is that it is "converting more slowly than we anticipated", because customers are spending on AI development rather than marketing. The quarter also gave the company less forward cover than it had a year ago. • Contract liabilities, cash billed for work not yet delivered: $62.0 million, down 7% from a year ago • Revenue from contracts longer than nine months: 28% of the quarter, against 31% a year earlier • Marketing revenue from outside North America: 12% of the segment, down from 16% • Adjusted EBITDA in the quarter: $18.6 million, down 18% from a year ago By our math the new range leaves about $41.5 million of adjusted EBITDA for the fourth quarter, level with last year's fourth quarter. That is a flat ending, not the acceleration the old plan required, so the cut concedes that the second-half step-up did not happen. Lower contract liabilities mean more of that fourth-quarter revenue must still be sold. What to watch: fourth-quarter adjusted EBITDA against the $39–44 million the new range implies, by our math. A second miss, against a range set only three months earlier, would say the problem is demand rather than planning. 🔴 𝗖𝗼𝗻𝘁𝗲𝗻𝘁 𝗮𝗻𝗱 𝗗𝗮𝘁𝗮 𝗖𝗼𝘀𝘁𝘀 𝗥𝗶𝘀𝗲 𝗮𝘀 𝗦𝗮𝗹𝗲𝘀 𝗙𝗮𝗹𝗹 Informa TechTarget's gross margin, the share of revenue left after the direct costs of producing its content and data, fell to 56.9% from 61.3% a year ago. The cause sits in one line. Cost of revenues rose 9% while sales fell. By our math it took 4.4 percentage points more of revenue than a year earlier. The filing says the increase came from "higher database and list rental costs", the outside data the group buys to reach audiences, net of lower production costs. Staff costs went the other way: selling and marketing fell 3.4 points of revenue after last year's workforce reduction. Net of both, adjusted EBITDA margin dropped 2.9 points to 15.6%. This matters because the workforce cuts were a one-time saving and management has now spent it. If audience building needs more bought data every quarter, that cost grows with the audience while revenue does not, and the lower margin in the new plan becomes permanent rather than seasonal. What to watch: cost of revenues as a share of sales in the fourth quarter, when revenue is seasonally highest. A share still above last year's fourth quarter would show the data costs are structural, not timing. 🔴 𝗖𝗼𝗻𝘀𝘂𝗹𝘁𝗶𝗻𝗴 𝗪𝗼𝗿𝗸 𝗦𝗹𝗶𝗽𝘀 𝗮𝘁 𝘁𝗵𝗲 𝗥𝗲𝘀𝗲𝗮𝗿𝗰𝗵 𝗔𝗿𝗺 Intelligence & Advisory is the segment that sells market research subscriptions and consulting projects, mostly under the Omdia brand. Its subscription revenue edged up 1% in the quarter, but advisory revenue fell 8%, so the segment shrank again. Noreck blamed the "timing of Consulting project deliverables". The profit damage was larger than the revenue drop. Segment operating income fell 11% to $9.1 million. Costs inside the segment rose while revenue fell, so its margin dropped to 28.9% from 31.8% a year ago, while the marketing segment held its margin. This is the third straight quarter of lower advisory revenue, and over nine months it is down 9%. Timing explains a quarter; it does not explain a year. Consulting is also where the regional split Nugent described bites hardest, because over half of the segment's revenue comes from outside North America, where customers are more cautious. What to watch: advisory services revenue in the fourth quarter, which carries the segment's annual client forums. A fourth decline would show the subscription base cannot carry the consulting arm through this cycle. 🔴 𝗥𝗶𝘀𝗸𝘀 𝗧𝗵𝗶𝘀 𝗤𝘂𝗮𝗿𝘁𝗲𝗿 𝗗𝗶𝗱𝗻'𝘁 𝗔𝗻𝘀𝘄𝗲𝗿 Four standing concerns got no answer in this quarter's materials, and one of them got a worse number. Each is a question for the next call, with the reading that would move it. • Parent charges: Informa, the majority owner, billed $5.3 million for transitional and secondment services, up from $4.8 million; the filing says the agreements, first set for about 18 months, are "the majority of which have been extended". An end date would settle it. • Cost savings: the $45 million run-rate synergy target for 2027 was not restated; a progress figure would show how much of the new profit plan rests on it. • Internal controls: the material-weakness remediation is still listed as ongoing, with no date; a clean report would remove the risk to reported segment trends, which were corrected again this quarter. • Long-term growth: the ambition to double revenue in five years has not been mentioned for seven quarters; a restatement or a withdrawal would tell investors what the strategy still aims at. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝗦𝗽𝗲𝗻𝗱 𝗼𝗻 𝗔𝗜, 𝗡𝗼𝘁 𝗠𝗮𝗿𝗸𝗲𝘁𝗶𝗻𝗴 The release says technology vendors are prioritising AI development over marketing investment, and Nugent described international markets as hit harder than North America by interest rates, wars and tariffs. He also sees Asian technology companies turning their growth plans toward Southeast Asia, the Middle East and Latin America rather than North America or Europe. Nugent expects mid-market demand to stay volatile. 𝗧𝗲𝗰𝗵𝗧𝗮𝗿𝗴𝗲𝘁.𝗰𝗼𝗺 𝗠𝗼𝘃𝗲𝘀 𝘁𝗼 𝘁𝗵𝗲 𝗗𝗶𝘃𝗲 𝗠𝗼𝗱𝗲𝗹 In the quarter the group completed a brand refresh and re-platforming of TechTarget.com, its largest site, onto the model used by its Dive newsletters, which push content to readers by email instead of waiting for search. The new network covers five topics: AI, the CIO, cybersecurity, data and infrastructure. Nugent plans to move the remaining media titles, including Dark Reading and InformationWeek, by the end of the first quarter of 2027. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝘀𝗽𝗲𝗻𝗱𝗶𝗻𝗴 (𝟮𝟲𝗤𝟯): $𝟱.𝟴 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Spending on software and equipment was 4.9% of revenue, by our math, against 3.3% a year ago. Most of it is capitalised software: Informa TechTarget capitalised $5.5 million of internal-use software in the quarter versus $3.9 million a year earlier. Nine-month capital spending is up 37%, which is why free cash flow is negative while adjusted EBITDA is positive. 𝗡𝗲𝘁 𝗱𝗲𝗯𝘁 (𝗦𝗲𝗽𝘁𝗲𝗺𝗯𝗲𝗿 𝟯𝟬, 𝟮𝟬𝟮𝟲): $𝟴𝟰.𝟴 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Borrowings from parent Informa, less cash, rose to $84.8 million from $73.7 million a year ago. The figure stood at $74.3 million at the end of June. The group drew another $13.4 million on the parent-provided credit line this year to fund negative cash flow. Net debt is about one times the last twelve months' adjusted EBITDA, by our math, so leverage is low but rising. 𝗙𝗿𝗲𝗲 𝗰𝗮𝘀𝗵 𝗳𝗹𝗼𝘄 (𝗳𝗶𝗿𝘀𝘁 𝗻𝗶𝗻𝗲 𝗺𝗼𝗻𝘁𝗵𝘀): -$𝟭𝟴.𝟳 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Cash from operations less capital spending was an $18.7 million outflow over nine months, against an $8.0 million outflow a year ago. Operating cash flow itself turned negative, at $1.5 million out, because the company paid down payables and accrued costs. Excluding the integration and restructuring payments it calls one-off, adjusted free cash flow was $15.0 million; Noreck said those payments end before 2027. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗙𝗬𝟮𝟬𝟮𝟲 𝗥𝗲𝘃𝗲𝗻𝘂𝗲: 𝗠𝗼𝗱𝗲𝘀𝘁𝗹𝘆 𝗹𝗼𝘄𝗲𝗿 𝘁𝗵𝗮𝗻 𝟮𝟬𝟮𝟱 ($𝟰𝟴𝟲.𝟴 𝗺𝗶𝗹𝗹𝗶𝗼𝗻) ⇘ decelerating 🠇 cut from Growth over 2025 Cut. The plan now has full-year revenue slightly below last year's $486.8 million. The first nine months fell 1.4%. By our math a 1% decline would leave about $140.5 million for the fourth quarter. That is level with last year's fourth quarter, so the promised "strong seasonal sequential improvement" is the normal seasonal step, not growth. The growth target had stood since February. 𝗙𝗬𝟮𝟬𝟮𝟲 𝗔𝗱𝗷𝘂𝘀𝘁𝗲𝗱 𝗘𝗕𝗜𝗧𝗗𝗔: $𝟴𝟬–𝟴𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating 🠇 cut from $95–100 million Cut. The middle of the range fell $15 million to $82.5 million. That is 6% below last year's result. By our math it leaves $39–44 million for the fourth quarter, about equal to last year's $41.6 million. The range had been held at every update since February, so this is the first move, and it is down. Noreck blamed lower revenue and continued spending on audience, product and sales. 𝗤𝟰 𝟮𝟬𝟮𝟲 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗮𝗻𝗱 𝗽𝗿𝗼𝗳𝗶𝘁𝗮𝗯𝗶𝗹𝗶𝘁𝘆: 𝗦𝘁𝗿𝗼𝗻𝗴 𝘀𝗲𝗮𝘀𝗼𝗻𝗮𝗹 𝘀𝗲𝗾𝘂𝗲𝗻𝘁𝗶𝗮𝗹 𝗶𝗺𝗽𝗿𝗼𝘃𝗲𝗺𝗲𝗻𝘁 𝗼𝘃𝗲𝗿 𝗤𝟯 ⇗ accelerating New. Nugent expects the fourth quarter to step up from the third in both revenue and profit, as it does every year, because the group's three annual partner forums across EMEA, the Americas and APAC fall in the quarter. Last year's fourth quarter was 15% above its third. The statement gives no figure, so the full-year ranges carry the arithmetic. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗳𝗼𝘂𝗿𝘁𝗵-𝗾𝘂𝗮𝗿𝘁𝗲𝗿 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗶𝘀 𝗮𝗹𝗿𝗲𝗮𝗱𝘆 𝗰𝗼𝗻𝘁𝗿𝗮𝗰𝘁𝗲𝗱? The new plan needs about $140 million in the fourth quarter while contract liabilities are 7% below a year ago. Investors need to know what share is booked and what the pipeline must still convert. 𝗪𝗶𝗹𝗹 𝗱𝗮𝘁𝗮𝗯𝗮𝘀𝗲 𝗮𝗻𝗱 𝗹𝗶𝘀𝘁 𝗿𝗲𝗻𝘁𝗮𝗹 𝗰𝗼𝘀𝘁𝘀 𝗸𝗲𝗲𝗽 𝗿𝗶𝘀𝗶𝗻𝗴? Cost of revenues took 4.4 points more of revenue than a year ago because of bought data. Whether that is a one-time audience investment or a recurring cost decides where gross margin settles. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗼𝗳 𝘁𝗵𝗲 $𝟰𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝘀𝘆𝗻𝗲𝗿𝗴𝘆 𝘁𝗮𝗿𝗴𝗲𝘁 𝗶𝘀 𝗱𝗲𝗹𝗶𝘃𝗲𝗿𝗲𝗱? The year-three savings and revenue-synergy goal was last restated a year ago. With the profit plan cut, the share already realised shows how much cost relief remains for 2027. 𝗪𝗵𝗲𝗻 𝗱𝗼 𝘁𝗵𝗲 𝘀𝗲𝗿𝘃𝗶𝗰𝗲 𝗰𝗵𝗮𝗿𝗴𝗲𝘀 𝗳𝗿𝗼𝗺 𝗜𝗻𝗳𝗼𝗿𝗺𝗮 𝗲𝗻𝗱? Charges rose to $5.3 million this quarter and most agreements have been extended beyond their initial 18 months. A date and a run-rate would show how much cost sits in the parent's hands. 𝗪𝗵𝗮𝘁 𝗱𝗼𝗲𝘀 𝘁𝗵𝗲 𝟮𝟬𝟮𝟳 𝗼𝗿𝗱𝗲𝗿 𝗯𝗮𝗰𝗸𝗹𝗼𝗴 𝘀𝗮𝘆 𝗮𝗯𝗼𝘂𝘁 𝗴𝗿𝗼𝘄𝘁𝗵? Nugent said the 2027 backlog rose during the quarter but gave no size. A growth figure for it, and whether it covers the advisory decline, would set the base for next year's plan.

$OPTU Q3 2026 earnings: Optimum prepares a debt restructuring while its cost cuts stall Optimum is still losing broadband customers at last year's pace, and this quarter the cost cuts that had protected profit ran out. Revenue fell 5% and profit before interest, tax and depreciation dropped 7%, the steepest fall in more than a year, because operating costs barely moved. The company wrote down its cable franchise rights again and repeated that it may not survive as a going concern without a deal on $6.3 billion of 2027 debt. • Revenue: $𝟮.𝟬𝟬 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 (−5.1% from a year ago) • Profit before interest, tax and depreciation, excluding one-offs: $𝟳𝟳𝟯.𝟳 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 (−6.9% from a year ago; 38.7% of revenue) • Residential broadband customers: 𝟯.𝟲𝟲 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 (−55,000 in the quarter; −5.5% from a year ago) • Outlook: 𝗡𝗼𝘁 𝘂𝗽𝗱𝗮𝘁𝗲𝗱 (June plan: $7.6 billion revenue this year excluding Lightpath; $6.3 billion of debt due in 2027) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🔴🔴 Very Bearish The story got worse because the company itself is now preparing for a court-supervised restructuring: new retention awards pay executives on a plan of reorganization and on Patrick Drahi losing control, while a lender group has sued over assets moved beyond its reach. The bad news continues on the cost side, where the margin gains of the past year reversed. One positive: mobile lines grew a third and business fiber revenue rose, but together they cover less than a third of the broadband revenue lost. The question now is whether creditors agree a deal that leaves anything for shareholders before the April maturity. A consensual plan could keep the East cable business and Lightpath inside a restructured group; a lender win on the fraudulent-transfer claims could pull them back for creditors. The December 31 vesting date in the new awards is the first date to watch. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢 𝗠𝗼𝗯𝗶𝗹𝗲 𝗟𝗶𝗻𝗲𝘀 𝗚𝗿𝗼𝘄 𝗮 𝗧𝗵𝗶𝗿𝗱 𝗪𝗵𝗶𝗹𝗲 𝗕𝗿𝗼𝗮𝗱𝗯𝗮𝗻𝗱 𝗦𝗵𝗿𝗶𝗻𝗸𝘀 Optimum sells mobile phone service to its broadband customers, and it is the only residential product the group still grows. It said the gain came from "increases in mobile lines, as well as increases in certain fees and surcharges", so volume and price both helped this quarter. • Mobile lines: 779,200, up 33% from a year ago • Net additions: 55,300 in the quarter, against 38,000 a year earlier • Mobile service revenue: $56.8 million, up 34% Mobile matters because a household with both services has one more reason to stay, but the business remains small. Service revenue added $14.6 million from a year ago while broadband lost $48.8 million, so the new product fills under a third of the hole the old one leaves. What to watch: fourth-quarter line additions, due in February. A figure above this quarter's 55,300 would show the bundle keeps gaining pace even as the broadband base it sells into shrinks. 🟢 𝗕𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗙𝗶𝗯𝗲𝗿 𝗚𝗿𝗼𝘄𝘀 𝗼𝗻 𝗗𝗮𝘁𝗮-𝗖𝗲𝗻𝘁𝗲𝗿 𝗖𝗼𝗻𝘁𝗿𝗮𝗰𝘁𝘀 Lightpath is Optimum's fiber network for large business customers, and it is laying lines for data-center operators under contracts announced earlier this year. Business services revenue rose 3.8% to $375.5 million, which the New York cable operator attributed to "increases in Ethernet, indefeasible right of use and other fees and surcharges revenue from our Lightpath business". The build shows in spending: capital expenditure for business services rose 53% to $89.4 million. Contracted work gives some visibility, because enterprise contracts not yet delivered equal about 37% of a year's business services revenue, and the company expects to recognize most of that within three years. What to watch: Lightpath's own revenue growth, which the filing does not give. A rate above the 5.6% reported a year ago would show the data-center contracts are turning into revenue, not only into spending. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗢𝗽𝘁𝗶𝗺𝘂𝗺 𝗣𝗮𝘆𝘀 𝗦𝘁𝗮𝗳𝗳 𝘁𝗼 𝗗𝗲𝗹𝗶𝘃𝗲𝗿 𝗮 𝗥𝗲𝗼𝗿𝗴𝗮𝗻𝗶𝘇𝗮𝘁𝗶𝗼𝗻 𝗣𝗹𝗮𝗻 Optimum owes $6.3 billion of debt that falls due in 2027, most of it in April, and has no financing arranged to repay it. The filing again states that "substantial doubt exists about our ability to continue as a going concern". • Cash: $1.10 billion, down $184 million from June • Free cash flow: a $268 million deficit in the quarter • Cash at Optimum CSC, the unrestricted company the lenders cannot reach: $948 million • Undrawn revolver at the restricted group that owes the 2027 debt: $72 million On November 5 the board replaced executives' bonus plans with cash retention awards "intended to drive the organization’s workforce toward restructuring the capital of Optimum and its subsidiaries". Part vests on "an order confirming a plan of reorganization", and half only on a change of control "whereby Patrick Drahi loses voting control". Creditors are moving too. On September 28 a group of term-loan lenders sued, asserting "fraudulent transfer claims under New York law" over assets moved out of the restricted group, which earned $222 million before interest and depreciation against $369 million of interest. Any split from the parent could add a tax bill above $4 billion, the group warned last quarter. What to watch: whether Optimum signs a "qualifying agreement" with creditors by December 31, the first vesting date in the new awards. An agreement would set out what, if anything, current shareholders keep. 🔴🔴 𝗕𝗿𝗼𝗮𝗱𝗯𝗮𝗻𝗱 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝗞𝗲𝗲𝗽 𝗟𝗲𝗮𝘃𝗶𝗻𝗴 𝗮𝘁 𝘁𝗵𝗲 𝗦𝗮𝗺𝗲 𝗣𝗮𝗰𝗲 Broadband is Optimum's largest product, 41% of revenue, and its customer base keeps shrinking. The company lost a net 55,000 residential broadband customers in the quarter, almost the same as a year earlier, so the decline has not eased in a year. • Residential broadband customers: 3.66 million, down 5.5% from a year ago • Broadband revenue: $824.6 million, down 5.6% • Homes passed that take any service: 41.2%, from 44.3% a year ago • Customers added on the fiber network: 14,200, against 39,000 a year earlier Price is not the cause. By our math broadband revenue per customer was about $74.60 a month, level with a year ago, so the whole revenue decline is customers leaving for fiber, fixed wireless and now satellite rivals in what the filing calls "the sustained competitive environment". That is why the June long-range plan looks hard. It needs the base to settle near 3.8 million within five years, yet at this pace, by our math, about 210,000 customers leave each year. What to watch: fourth-quarter broadband losses, which compare with 60,700 a year ago, when a price rise lifted revenue per customer. A loss below 55,000 would be the first sign in a year that the simplified pricing is holding customers. 🔴🔴 𝗧𝗵𝗲 𝗖𝗼𝘀𝘁 𝗖𝘂𝘁𝘀 𝗦𝘁𝗼𝗽𝗽𝗲𝗱 𝗧𝗵𝗶𝘀 𝗤𝘂𝗮𝗿𝘁𝗲𝗿 For two years Optimum has told investors that AI tools, fewer service visits and a smaller workforce would keep lowering operating costs, and through June they did. This quarter other operating expenses, the line that carries staff, marketing and call centers, slipped 1% while revenue dropped 5%. • Other operating expenses: 32.3% of revenue, up 1.4 percentage points from a year ago • Sales and marketing: $178.8 million, up 8% • Programming costs: 20.7% of revenue, down 1.7 points as video customers left • Profit before interest, tax and depreciation, excluding one-offs: 38.7% of revenue, down 0.7 points The company still credits "lower truck rolls" for cheaper labor, but it spent more on marketing and on consultants, and the gross margin cushion is thinning too. Programming costs fell $0.79 for each dollar of video revenue lost, against $0.98 last quarter, because the networks keep raising rates as customers leave. The filing repeats that "We expect contractual rates to increase in the future". What to watch: the fourth-quarter margin on profit before interest, tax and depreciation, which was 41.3% a year ago on a price rise. A margin below 39% would confirm that the cost program has run out of room. 🔴 𝗔𝗻𝗼𝘁𝗵𝗲𝗿 $𝟯.𝟮 𝗕𝗶𝗹𝗹𝗶𝗼𝗻 𝗪𝗿𝗶𝘁𝗲-𝗗𝗼𝘄𝗻, 𝗪𝗶𝘁𝗵 𝗟𝗶𝘁𝘁𝗹𝗲 𝗖𝘂𝘀𝗵𝗶𝗼𝗻 𝗟𝗲𝗳𝘁 Optimum wrote down its cable franchise rights, the accounting value of its licenses to operate, by $3.2 billion, after a $2.7 billion charge in March. It blamed higher interest rates, which raised the discount rate on its cash flows, and "a decrease in the long-term growth rate of 1%" for "the sustained competitive environment". The charges cost no cash, but they leave no cushion. The rights now sit at fair value, so a further 10% fall would cost another $570 million. A similar fall in the value of the whole business would start a goodwill charge near $1.6 billion. The write-downs also led the company to set aside $220 million against deferred tax assets it now doubts it can use. What to watch: the annual impairment test dated October 1, reported with fourth-quarter results. A third charge would show the cash flows in the June plan keep falling short of what management assumed. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗧𝗲𝗻𝗱𝗲𝗿 𝗢𝗳𝗳𝗲𝗿 𝗗𝗼𝗻𝗲 𝗮𝗻𝗱 𝗘𝗮𝗿𝗹𝗶𝗲𝗿 𝗥𝗲𝘀𝘂𝗹𝘁𝘀 𝗥𝗲𝘀𝘁𝗮𝘁𝗲𝗱 Optimum CSC bought 120 million public shares for $300 million in July, funded with the preferred units it sold in May. It booked a $160.8 million expense, because accounting rules value the shares at their closing price, and holds them in treasury rather than cancelling them. Separately, the company restated its first two quarters after it missed deferred tax benefits on the impairments, and it reports a material weakness in tax accounting. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗖𝗮𝘀𝗵 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝘀𝗽𝗲𝗻𝗱𝗶𝗻𝗴 (𝟮𝟲𝗤𝟯): $𝟯𝟰𝟳.𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Capital spending rose 7% from a year ago while revenue shrank, so it took 17.4% of revenue, the highest share in more than a year. The rise came from business services, where fiber builds for Lightpath took $89.4 million. Network spending on the consumer footprint fell 15%. Nine-month spending of $975 million sits inside the $1.2–1.5 billion annual plan. 𝗡𝗲𝘁 𝗱𝗲𝗯𝘁 (𝟮𝟲𝗤𝟯): 𝗮𝗯𝗼𝘂𝘁 $𝟮𝟱.𝟴 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating By our math net debt rose about $440 million from June, to $25.8 billion. The group borrowed $250 million more at the unrestricted UnSub group in July, while cash fell. It also drew another $100 million on the restricted group's revolver. Total debt principal is $27.0 billion including finance leases, and $6.4 billion of it is now classed as due within a year. 𝗙𝗶𝗯𝗲𝗿 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 (𝟮𝟲𝗤𝟯): 𝟳𝟲𝟰,𝟮𝟬𝟬 ⇘ decelerating Customers on the fiber network grew 8.6% from a year ago, but additions keep slowing. Optimum added 15,300 this quarter against 40,400 a year earlier. Fiber now passes 3.18 million homes, of which about a quarter take service. The company slowed its push to move cable customers onto fiber last year, so the migration that once drove record quarters has faded. 𝗥𝗲𝘀𝗶𝗱𝗲𝗻𝘁𝗶𝗮𝗹 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗽𝗲𝗿 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿 (𝟮𝟲𝗤𝟯): $𝟭𝟯𝟭.𝟯𝟳 𝗮 𝗺𝗼𝗻𝘁𝗵 ⇘ decelerating Monthly revenue per residential customer fell 1.4% from a year ago and has slipped every quarter since December, when it was $134.49. Video customers pay the most and are leaving fastest, so the mix pulls the average down even where prices rose. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗣𝗿𝗼𝗴𝗿𝗮𝗺𝗺𝗶𝗻𝗴 𝗰𝗼𝘀𝘁 𝗿𝗮𝘁𝗲𝘀 (𝟮𝟬𝟮𝟲): 𝗘𝘅𝗽𝗲𝗰𝘁𝗲𝗱 𝘁𝗼 𝗶𝗻𝗰𝗿𝗲𝗮𝘀𝗲; 𝗻𝗼 𝗳𝗶𝗴𝘂𝗿𝗲 𝗴𝗶𝘃𝗲𝗻 ⇒ stable 🠆 unchanged from Expected to increase (stated with earlier results) Unchanged. The company again says the fees it pays to television networks will rise, and the renewals it signed this year lifted off-balance-sheet commitments to $5.3 billion from $4.1 billion in December. Programming still takes about 72% of video revenue, a share that has barely moved in a year, so each video customer lost removes cost almost as fast as revenue. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗛𝗮𝘀 𝗢𝗽𝘁𝗶𝗺𝘂𝗺 𝗿𝗲𝗮𝗰𝗵𝗲𝗱 𝗮𝗻𝘆 𝗮𝗴𝗿𝗲𝗲𝗺𝗲𝗻𝘁 𝘄𝗶𝘁𝗵 𝗶𝘁𝘀 𝟮𝟬𝟮𝟳 𝗹𝗲𝗻𝗱𝗲𝗿𝘀? The new retention awards vest on a "qualifying agreement" by December 31 and on a plan of reorganization by February 28, yet the filing says nothing about talks under the cooperation agreement that binds almost all CSC Holdings lenders. 𝗛𝗼𝘄 𝗳𝗮𝘀𝘁 𝗶𝘀 𝗟𝗶𝗴𝗵𝘁𝗽𝗮𝘁𝗵 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 𝗴𝗿𝗼𝘄𝗶𝗻𝗴? Business services grew 3.8%, which the company credits to Lightpath, but it no longer breaks out Lightpath's own growth. The data-center contracts drive this year's capital spending, so investors need the revenue they produce. 𝗛𝗼𝘄 𝗺𝗮𝗻𝘆 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝗹𝗲𝗳𝘁 𝘄𝗶𝘁𝗵 𝘁𝗵𝗲 𝗪𝗲𝘀𝘁 𝗺𝗮𝗿𝗸𝗲𝘁 𝗲𝘅𝗶𝘁? Total passings fell 17,300 after the company removed low-density West markets. It has not said how many broadband or video customers went with them, or whether they sit inside the 55,000 quarterly loss. 𝗗𝗼𝗲𝘀 𝘁𝗵𝗲 𝗝𝘂𝗻𝗲 𝗽𝗹𝗮𝗻 𝗳𝗼𝗿 𝘁𝗵𝗶𝘀 𝘆𝗲𝗮𝗿 𝘀𝘁𝗶𝗹𝗹 𝗵𝗼𝗹𝗱? The filing carries no outlook. The June plan showed revenue of $7.6 billion this year excluding Lightpath; nine-month revenue is down 5% and profit before interest, tax and depreciation is down 3.5%, so investors need a restated plan. 𝗪𝗵𝗮𝘁 𝗱𝗼𝗲𝘀 𝗺𝗼𝗯𝗶𝗹𝗲 𝗲𝗮𝗿𝗻 𝗮𝗳𝘁𝗲𝗿 𝗻𝗲𝘁𝘄𝗼𝗿𝗸 𝗰𝗼𝘀𝘁𝘀? Mobile service revenue grew 34%, but Optimum resells another carrier's network and has never disclosed the cost per line, so investors cannot tell whether the fastest-growing product makes money.

$BKD Q3 2026 earnings: Brookdale cuts its outlook, but earns more from each resident Brookdale filled its rooms more slowly than planned this summer, so it lowered its targets for the year. Revenue per available unit rose 7.5%, short of the 8.2% the senior-living operator expected. Chief executive Nick Stengle blamed slower occupancy growth and fewer referral leads. Profit excluding one-offs still rose 12% on rents and staff savings. • Revenue per available unit (RevPAR): +𝟳.𝟱% (from a year ago; Brookdale had planned about 8.2%) • Operating profit excluding one-offs (Adjusted EBITDA): $𝟭𝟮𝟰.𝟯𝗠 (+12% from a year ago) • Occupancy: 𝟴𝟯.𝟭% (+1.3 points from a year ago, the smallest gain in seven quarters) • Full-year profit outlook: 𝗖𝘂𝘁 $𝟭𝟬.𝟱𝗠 (middle of the range: $498.5M) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🔴 Bearish The story got worse because the targets came down after three quarters on hold, and demand, not cost, is the reason. Brookdale needs mid-teens profit growth to cut its debt, yet leverage edged up to 8.5 times as it bought more buildings. The good news: margins widened, and fewer communities sit under 70% full. The question now is whether the weak summer was Brookdale's own disruption or weaker demand. Stengle says the sales shake-up is nearly done and lead conversion is near a record. Or mortgage rates and lost referral leads delay moves industry-wide. The first full quarter under the new sales chief will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢 𝗟𝗼𝘄𝗲𝗿 𝗦𝘁𝗮𝗳𝗳 𝗖𝗼𝘀𝘁𝘀 𝗟𝗶𝗳𝘁𝗲𝗱 𝘁𝗵𝗲 𝗠𝗮𝗿𝗴𝗶𝗻 Brookdale's largest cost is the people who run its communities. In the summer it cut administrative roles, and finance chief Dawn Kussow said "we took actions to bolster our labor management discipline". • Labor at communities open both years: 45.3% of revenue, down 1.2 percentage points • Other running costs there: 25.5% of revenue, up 0.7 points • Head-office costs excluding one-offs: $36.6 million, down 15% The savings matter because revenue at those communities grew only 5%, so most of the 7% rise in operating income came from costs. But other cost lines still grow about 8% a year, Kussow said. What to watch: labor as a share of revenue in the fourth quarter, which Kussow said should sit slightly below this quarter's level. A lower share would confirm the savings are structural. 🟢 𝗠𝗼𝗿𝗲 𝗖𝗼𝗺𝗺𝘂𝗻𝗶𝘁𝗶𝗲𝘀 𝗔𝗿𝗲 𝗢𝘃𝗲𝗿 𝟵𝟬% 𝗙𝘂𝗹𝗹 Brookdale sorts its communities by how full they are, because a nearly full building earns far more per unit than a half-empty one. Both ends improved this quarter. • Communities over 90% occupied: 186, up from 167 in June • Communities under 70% occupied: 69, down from 85 in June • Yearly profit per unit, owned communities above 80% full: about $20,200, against $3,500 below 70% Each extra resident adds almost pure profit, because a building's costs are mostly fixed. But 9 near-empty communities were on August's sale list, so by our math at least 7 improved on their own. What to watch: the count under 70% in the fourth-quarter report, after the remaining sales close. A further drop would show the sales team filling weak buildings rather than selling them. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗦𝗹𝗼𝘄 𝗦𝘂𝗺𝗺𝗲𝗿 𝗠𝗼𝘃𝗲-𝗜𝗻𝘀 𝗙𝗼𝗿𝗰𝗲𝗱 𝗮𝗻 𝗢𝘂𝘁𝗹𝗼𝗼𝗸 𝗖𝘂𝘁 Brookdale planned on a strong summer, the season when senior living fills its rooms. Instead, chief executive Nick Stengle said, "we fell short of our RevPAR goal due to slower occupancy growth, particularly late in the quarter". RevPAR is monthly revenue per available unit, combining price with how full the buildings are. Move-ins beat last year yet missed plan, and move-outs ran slightly above it. "Lead volume during the quarter was below where it needed to be", Stengle said, so the targets for the year came down. • Occupancy gain from a year ago: 1.3 points, the smallest in seven quarters • Full-year RevPAR growth target: 7.4-7.9%, from 8-9% • Full-year profit target, excluding one-offs: $495-502 million, from $502-516 million The cut matters beyond this year, because Brookdale needs mid-teens profit growth every year to bring its debt down. Stengle still expects that pace, but Kussow's reasons for next year were cost savings and rent saved by buying buildings, not fuller rooms. What to watch: the yearly occupancy gain in the fourth-quarter report. A gain below this quarter's 1.3 points, with rates rising again in January, would mean Brookdale trades residents for price. 🔴🔴 𝗕𝘂𝘆𝗶𝗻𝗴 𝗜𝘁𝘀 𝗕𝘂𝗶𝗹𝗱𝗶𝗻𝗴𝘀 𝗔𝗱𝗱𝘀 𝗗𝗲𝗯𝘁 𝗙𝗮𝘀𝘁𝗲𝗿 𝗧𝗵𝗮𝗻 𝗣𝗿𝗼𝗳𝗶𝘁 Brookdale rents a third of its communities and is buying them back; "Increasing ownership reduces lease expense and renewal uncertainty", Stengle said. It bought 17 in September and agreed in October to buy 30 more. Its sale of unwanted communities is nearly complete. The deals cut rent but add more debt. The latest purchase costs $290 million and saves about $17.8 million of rent a year. So by our math Brookdale pays 16 years of rent up front, twice its current leverage. Kussow told analysts leverage improved slightly, to 8.3 times profit. Measured as in June it rose to 8.5 times, because her figure strips out rent still paid on the newly bought buildings. Net debt rose $122 million. Owning gives Brookdale the full upside when a building fills, at a price "significantly below replacement cost", Kussow said. But cutting leverage below 6 times by 2028 needs profit to rise, and each purchase pushes the ratio up first. What to watch: the leverage ratio at year end, after the latest purchase closes. A reading above 8.5 times would mean the buy-ins push leverage away from the target. 🔴 𝗗𝗶𝘀𝗰𝗼𝘂𝗻𝘁𝘀 𝗧𝗿𝗶𝗺𝗺𝗲𝗱 𝗣𝗿𝗶𝗰𝗲𝘀 𝗯𝘂𝘁 𝗗𝗶𝗱 𝗡𝗼𝘁 𝗙𝗶𝗹𝗹 𝗥𝗼𝗼𝗺𝘀 Brookdale raised rents sharply last January while trying to fill rooms. The standing worry is that rate gains cost occupancy, because some residents leave over the price. Revenue per occupied unit at communities open both years rose 4.8% from a year ago but slipped 0.2% from the second quarter. The dip was "driven by incentive programs we implemented to help drive additional move in activity", Kussow said. Move-outs still ran above plan. Stengle nonetheless said "we are anticipating another meaningful in place rate increase" in January. That is the test: a large rise into slower demand could push more residents out. What to watch: January's rate increase and first-quarter occupancy at communities open both years. A yearly gain below this quarter's half a point would mean the rise cost residents. 🔴 𝗥𝗶𝘀𝗸𝘀 𝘁𝗵𝗶𝘀 𝗾𝘂𝗮𝗿𝘁𝗲𝗿 𝗱𝗶𝗱𝗻'𝘁 𝗮𝗻𝘀𝘄𝗲𝗿 Two standing concerns received no new information this quarter, so they stay open. Each line names the reading that would move it. • Monthly occupancy reports: Brookdale still plans to stop them after December 2026, just as growth slows; a replacement indicator, or a reversal, would move this. • Class-action lawsuits over staffing and consumer protection: no update on cost or status; a reserve or settlement figure in the annual report would. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗠𝗼𝗿𝘁𝗴𝗮𝗴𝗲 𝗥𝗮𝘁𝗲𝘀 𝗮𝗻𝗱 𝗪𝗲𝗮𝗸𝗲𝗿 𝗥𝗲𝗳𝗲𝗿𝗿𝗮𝗹𝘀 𝗦𝗹𝗼𝘄 𝗠𝗼𝘃𝗲-𝗜𝗻𝘀 Stengle pointed to two outside forces. Families weighing senior living face "30 year fixed mortgage rates of over 7%" and high fuel prices, which delays a move. And referral websites, which supply a minority of Brookdale's leads, send fewer as AI search replaces web search. Their volume has "declined across the industry", he said. By the NIC data Brookdale cites, industry occupancy grew more slowly than its own. 𝗕𝗿𝗼𝗼𝗸𝗱𝗮𝗹𝗲 𝗦𝗽𝗲𝗻𝗱𝘀 𝗠𝗼𝗿𝗲 𝗼𝗻 𝗙𝗲𝘄𝗲𝗿 𝗕𝘂𝗶𝗹𝗱𝗶𝗻𝗴𝘀 Brookdale changed how it spends on its communities. Instead of small upgrades everywhere, it concentrates money on buildings it can "transform and comprehensively upgrade", Stengle said, through a programme it calls First Impressions. Community spending reached $47 million in the quarter, "our highest quarterly investment level in several years". That is $1,118 per unit, from $668 a year ago; Brookdale has not yet shown an occupancy result from finished projects. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗖𝗮𝘀𝗵 𝗹𝗲𝗳𝘁 𝗮𝗳𝘁𝗲𝗿 𝘂𝗽𝗸𝗲𝗲𝗽 𝘀𝗽𝗲𝗻𝗱𝗶𝗻𝗴 (𝗔𝗱𝗷𝘂𝘀𝘁𝗲𝗱 𝗳𝗿𝗲𝗲 𝗰𝗮𝘀𝗵 𝗳𝗹𝗼𝘄, 𝟮𝟲𝗤𝟯): $𝟭𝟯.𝟮 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Fell to $13.2 million from $21.8 million a year ago. The reason is spending on upkeep and upgrades, which rose 44% to its highest level in years. Operating cash flow itself rose 11%. Over nine months the measure totals $39 million, so the group pays for its building purchases with asset sales and debt rather than from operations. 𝗟𝗶𝗾𝘂𝗶𝗱𝗶𝘁𝘆 (𝟮𝟲𝗤𝟯): $𝟱𝟮𝟯.𝟲 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Fell $42 million from June, as cash spent on the 17 communities exceeded proceeds from sales. The total is $524 million, mostly cash plus what it can still draw on its credit line. No mortgage comes due until 2028 after July's refinancing, so the drop reflects spending choices rather than pressure from lenders. 𝗦𝗵𝗮𝗿𝗲𝘀 𝗼𝘂𝘁𝘀𝘁𝗮𝗻𝗱𝗶𝗻𝗴, 𝘄𝗲𝗶𝗴𝗵𝘁𝗲𝗱 (𝟮𝟲𝗤𝟯): 𝟮𝟯𝟵.𝟭 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable Up 0.7% from a year ago through stock compensation; Brookdale buys back no shares. In October it issued 0.9 million shares to settle convertible notes and received 0.4 million back from the related hedge. The count therefore rises slightly again in the fourth quarter. Capital goes to upgrades, building purchases and debt. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗙𝗬𝟮𝟲 𝗥𝗲𝘃𝗣𝗔𝗥 𝗴𝗿𝗼𝘄𝘁𝗵: 𝟳.𝟰% 𝘁𝗼 𝟳.𝟵% ⇘ decelerating 🠇 cut from 8.0% to 9.0% Cut. The middle of the range now says revenue per available unit grows about 7.7% this year. By our math that leaves 5.5% to 7.5% for the fourth quarter, which Kussow put in the "high-6% range". The reasons are the summer occupancy shortfall carrying forward, incentives, and the Clinton fire. Brookdale also expects about 41,750 average units in the quarter, up from 41,500, which points to sales closing later than planned. 𝗙𝗬𝟮𝟲 𝗔𝗱𝗷𝘂𝘀𝘁𝗲𝗱 𝗘𝗕𝗜𝗧𝗗𝗔: $𝟰𝟵𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝘁𝗼 $𝟱𝟬𝟮 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating 🠇 cut from $502 million to $516 million Cut. The top of the new range is the bottom of the old one, after three quarters of holding it. By our math the range leaves $117.5-124.5 million for the fourth quarter, growth of 11-18% against last year's weak quarter. Kussow listed the pieces: full-quarter labor savings, slightly elevated other costs, extra marketing, and the Clinton fire's "a few million dollars in the fourth quarter". Last year Brookdale beat its initial range, so the record is one cut after a beat. 𝗙𝗬𝟮𝟲 𝗚&𝗔 𝗲𝘅𝗽𝗲𝗻𝘀𝗲: 𝗔𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 $𝟭𝟱𝟰 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating 🠇 cut from Approximately $157 million Cut, which for a cost line is good news: head-office spending should end the year about $3 million below the August plan. The target has come down twice this year from $162 million, as Brookdale shrank its central staff to fit a smaller portfolio. By our math that leaves about $38 million for the fourth quarter, close to the $36.6 million just spent excluding one-offs. 𝗙𝗬𝟮𝟲 𝗰𝗮𝘀𝗵 𝗳𝗮𝗰𝗶𝗹𝗶𝘁𝘆 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗹𝗲𝗮𝘀𝗲 𝗽𝗮𝘆𝗺𝗲𝗻𝘁𝘀: 𝗔𝗽𝗽𝗿𝗼𝘅𝗶𝗺𝗮𝘁𝗲𝗹𝘆 $𝟭𝟳𝟮 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating 🠇 cut from Slightly below $180 million Cut by about $8 million, because Brookdale now owns communities it rented until September. By our math the fourth quarter carries about $39 million of rent, down 10% from a year ago. The decline shrinks from earlier quarters because the late-2025 lease exits now sit in both years. The pending 30-community purchase would remove a further $17.8 million of yearly rent if it closes this quarter. 𝗙𝗬𝟮𝟲 𝗰𝗼𝗻𝘀𝗼𝗹𝗶𝗱𝗮𝘁𝗲𝗱 𝗼𝗰𝗰𝘂𝗽𝗮𝗻𝗰𝘆: 𝗕𝗲𝗹𝗼𝘄 𝟴𝟯% ⇒ stable 🠇 cut from Roughly 83% Cut. In August Kussow expected the year to average roughly 83%; she now says it will "come in below 83%". October's 83.5% was only 0.1 points above September, and her plan assumes "occupancy growth remains muted during the fourth quarter". The wording points to a roughly flat fourth quarter rather than a decline. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗛𝗼𝘄 𝗺𝗮𝗻𝘆 𝗿𝗲𝘀𝗶𝗱𝗲𝗻𝘁𝘀 𝗺𝗼𝘃𝗲𝗱 𝗶𝗻 𝗮𝗻𝗱 𝗼𝘂𝘁 𝗲𝗮𝗰𝗵 𝗺𝗼𝗻𝘁𝗵? Stengle said move-ins beat last year but missed plan and move-outs ran above it, without numbers. The monthly split, and the share of move-outs tied to price, would show whether the January rate rise is costing residents. 𝗪𝗵𝗮𝘁 𝘀𝗵𝗮𝗿𝗲 𝗼𝗳 𝗹𝗲𝗮𝗱𝘀 𝗰𝗼𝗺𝗲𝘀 𝗳𝗿𝗼𝗺 𝗿𝗲𝗳𝗲𝗿𝗿𝗮𝗹 𝘄𝗲𝗯𝘀𝗶𝘁𝗲𝘀? Stengle called external sources a meaningful minority of leads and said their volume is falling industry-wide. The share, and how far it fell, would show how much ground the internal sales push must make up. 𝗛𝗼𝘄 𝗶𝘀 𝘁𝗵𝗲 $𝟮𝟵𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝗽𝘂𝗿𝗰𝗵𝗮𝘀𝗲 𝗳𝗶𝗻𝗮𝗻𝗰𝗲𝗱, 𝗮𝗻𝗱 𝗮𝘁 𝘄𝗵𝗮𝘁 𝗿𝗮𝘁𝗲? The 30 communities save $17.8 million of rent a year. The mortgage amount and its rate decide whether cash flow improves at all, and how far leverage rises when the deal closes. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗼𝗳 𝟮𝟬𝟮𝟳'𝘀 𝗺𝗶𝗱-𝘁𝗲𝗲𝗻𝘀 𝗴𝗿𝗼𝘄𝘁𝗵 𝗰𝗼𝗺𝗲𝘀 𝗳𝗿𝗼𝗺 𝗰𝗼𝘀𝘁 𝘀𝗮𝘃𝗶𝗻𝗴𝘀? Kussow listed labor productivity, lower other costs, rent saved from purchases and head-office cuts as the reasons for confidence. Dollar figures for each would show how much of the growth needs occupancy at all. 𝗛𝗼𝘄 𝗺𝗮𝗻𝘆 𝗙𝗶𝗿𝘀𝘁 𝗜𝗺𝗽𝗿𝗲𝘀𝘀𝗶𝗼𝗻𝘀 𝘂𝗽𝗴𝗿𝗮𝗱𝗲𝘀 𝗵𝗮𝘀 𝗕𝗿𝗼𝗼𝗸𝗱𝗮𝗹𝗲 𝗰𝗼𝗺𝗽𝗹𝗲𝘁𝗲𝗱? The plan for this year called for about 30 projects with budgets above $250,000. Progress, and the occupancy change at completed buildings, would show whether concentrated spending fills rooms faster.

$GTN Q3 2026 earnings: Gray sets an election ad record, but debt stays high Election spending gave Gray Media a record political quarter, while the advertising its stations sell every year keeps shrinking. Political advertising brought in $198 million, the most ever for a third quarter. Chief executive Hilton Howell now expects $630-640 million for the full year. Without political money and the stations bought this year, revenue fell about 4% by our math. • Revenue from stations owned a year ago, excluding political: -𝟰% (from a year ago, by our math) • Political advertising revenue: $𝟭𝟵𝟴𝗠 ($173M in the same quarter of 2024) • Debt net of cash: $𝟱.𝟲𝟳𝗕 ($5.44B at the start of the year) • Full-year political outlook: $𝟲𝟯𝟬-𝟲𝟰𝟬𝗠 ($497M in 2024) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🟢 Bullish The story got better because Gray pushed its largest debt deadlines out to 2030, past the quiet year after the election. The bad news: debt net of cash is higher than in January, because the political cash went into stations, and underlying advertising fell about 6%. The question now is whether Gray can keep cutting debt in 2027 without an election to pay for it. Either lower interest and rising distributor fees cover the lost political money, or leverage climbs again as it did after 2024. The December leverage ratio and the first-quarter outlook in February will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢🟢 𝗘𝗹𝗲𝗰𝘁𝗶𝗼𝗻 𝗔𝗱𝘀 𝗦𝗲𝘁 𝗮 𝗥𝗲𝗰𝗼𝗿𝗱 𝗳𝗼𝗿 𝗚𝗿𝗮𝘆 Candidates buy airtime on Gray Media's stations in election years, and this one is the biggest yet. Political advertising brought in $198 million in the quarter, against $173 million in the same quarter of the last election year. Kevin Latek, chief legal and development officer, said money left Georgia and North Carolina for Iowa, Alaska, Maine and Nebraska, where Gray leads the state. Chief executive Hilton Howell said the election showed "a hell of a lot more swing states and competitive states" in Gray's footprint. • Full-year outlook: $630-640 million, about 28% above 2024 • Political revenue per TV household: $13.45, from $10.83 in 2024, per Latek • From acquired stations: $4 million this quarter, $16 million for the year Political money arrives in advance, and Gray directs it at debt. By our math, $619 million from the old footprint still beats the 2020 record. But Latek's account says the money followed close races, which may move again by 2028. What to watch: fourth-quarter political revenue in February, which the outlook puts at $319-329 million against $250 million two years ago. Inside that range would be Gray's strongest fourth quarter ever. 🟢 𝗣𝗮𝘆-𝗧𝗩 𝗙𝗲𝗲𝘀 𝗚𝗿𝗼𝘄 𝗔𝗴𝗮𝗶𝗻 𝗪𝗶𝘁𝗵𝗼𝘂𝘁 𝘁𝗵𝗲 𝗔𝗰𝗾𝘂𝗶𝘀𝗶𝘁𝗶𝗼𝗻𝘀 Cable and satellite companies pay Gray to carry its stations. What is left after network fees, net retransmission revenue, is growing again after falling through most of 2025. Gray collected 14% more this quarter than a year ago. Acquired stations added $9 million of it, so the old footprint grew about 7% by our math. The comparison was soft, because Atlanta's WANF left CBS in August 2025. The release still cites "continued subscriber declines", and distributor fees from the old stations fell about 5% by our math. But Gray's rates stay fixed until 2027, when contracts covering 61% of subscribers come up. What to watch: fourth-quarter net retransmission revenue against the $152-155 million outlook. Growth inside it would leave the 2027 renewals, not subscriber losses, as this stream's test. concern eased — 𝗚𝗿𝗮𝘆 𝗣𝘂𝘀𝗵𝗲𝗱 𝗜𝘁𝘀 𝗕𝗶𝗴 𝗗𝗲𝗯𝘁 𝗗𝗲𝗮𝗱𝗹𝗶𝗻𝗲𝘀 𝗣𝗮𝘀𝘁 𝟮𝟬𝟮𝟴 Until August, Gray's two largest debts came due soon after the next election: a term loan in 2028 and its most expensive notes in 2029. Refinancing them in a year without election money was the main balance-sheet risk. Since then Gray has borrowed new money due in 2030 and 2034 and repaid most of the old loan and most of the old notes. The revolving credit line now runs to 2030 as well. • Term loan due 2028: $150 million left, from $739 million • 10.5% notes due 2029: $200 million left, from $1.1 billion in January • New debt: $750 million of 7.5% notes due 2034 and a $675 million term loan due 2030, for about $65 million of fees This changes the case because no large maturity now falls before the 2028 election has paid in. The price was a $40 million loss on retiring debt early this quarter; Howell expects the saving to reach at least $40 million a year. What to watch: the 2027 interest outlook in February. By our math a figure at or below $410 million would show the saving Howell described reaching the income statement. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗗𝗲𝗯𝘁 𝗘𝗻𝗱𝘀 𝘁𝗵𝗲 𝗬𝗲𝗮𝗿 𝗡𝗲𝗮𝗿 𝗪𝗵𝗲𝗿𝗲 𝗜𝘁 𝗦𝘁𝗮𝗿𝘁𝗲𝗱 Gray calls debt reduction its priority, and the election year brought the cash. Yet net debt reached $5.67 billion in September, from $5.44 billion in December, about what Gray paid for stations. Finance chief Jeff Gignac plans to cut $175-200 million of debt with fourth-quarter political cash. By our math that leaves roughly $5.5 billion, above January's level. • Covenant leverage: 5.70 times, from 5.80 in December, on a bigger denominator, not less debt • Acquired stations: $66 million of revenue, $52 million of costs, a 21% margin by our math, against Gray's 33% • Operating profit before depreciation, excluding one-offs: $319 million, below the $338 million of the same quarter in 2024 The denominator includes savings Gray expects but has not booked: $161 million, from $144 million in June. Gignac said the company is "probably 75%-80% of the way there in getting those into our run rate". Yet it grew this quarter, and acquired stations earn thinner margins than Gray. What to watch: the total net leverage ratio at December 31, due in February. Above 5.5 times would mean the acquisitions absorbed the cash Gignac meant for debt. 🔴 𝗥𝗲𝗴𝘂𝗹𝗮𝗿 𝗔𝗱𝘃𝗲𝗿𝘁𝗶𝘀𝗶𝗻𝗴 𝗙𝗲𝗹𝗹 𝟲% 𝗪𝗶𝘁𝗵𝗼𝘂𝘁 𝘁𝗵𝗲 𝗕𝗼𝘂𝗴𝗵𝘁 𝗦𝘁𝗮𝘁𝗶𝗼𝗻𝘀 Core advertising is what businesses pay Gray outside election campaigns, and it must carry 2027. The release reports it up 1%, but acquired stations supplied $24 million of it. Without them, by our math, the old footprint fell about 6%. The filing blames "macro-economic softness" and campaigns crowding out normal advertisers. Co-chief executive Pat LaPlatney said gambling was strong, while communications, health and insurance were soft. The fourth-quarter outlook, down low-to-mid single digits as reported, implies the old footprint down roughly 10% by our math if acquisitions repeat this quarter's contribution. What to watch: the first-quarter core advertising outlook in February. LaPlatney said "our current pacing in Q1 is positive" on a same-station basis. But that quarter laps about $26 million of Olympics and Super Bowl revenue by our math. 🔴 𝗥𝗶𝘀𝗸𝘀 𝘁𝗵𝗶𝘀 𝗾𝘂𝗮𝗿𝘁𝗲𝗿 𝗱𝗶𝗱𝗻'𝘁 𝗮𝗻𝘀𝘄𝗲𝗿 Four standing concerns got no new number this quarter. Most of them concern the year after the election, when political money stops and ordinary revenue alone must carry the debt. • 2027 without an election: about $635 million of political revenue falls away; Gignac counts $40-50 million of lower interest and preferred dividends against it, and the positive first-quarter pacing LaPlatney cited is early. • Assembly Atlanta studio: the production segment broke even this quarter and lost $6 million over nine months; no update on the land ventures promised for 2026. • Pension plan closure: the plan terminated on October 1, and the filing says the settlement charge is still under evaluation. • State attorneys general: no comment this quarter on whether they will challenge further in-market station combinations. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗖𝗼𝗻𝗴𝗿𝗲𝘀𝘀 𝗖𝗵𝗮𝗻𝗴𝗲𝘀 𝗛𝗮𝗻𝗱𝘀, 𝗚𝗿𝗮𝘆 𝗞𝗲𝗲𝗽𝘀 𝗕𝘂𝘆𝗶𝗻𝗴 𝗦𝘁𝗮𝘁𝗶𝗼𝗻𝘀 Howell told analysts he does not expect "a significant change from the FCC". He will wait until January to hear from "the Democratic majority in both the Senate and the House". Then he will argue to either party that combining stations keeps newsrooms open. His example is Louisville, where WDRB and WAVE now share one newsroom of "more than 100 journalists", said chief operating officer Sandy Breland. 𝗣𝗿𝗼 𝗦𝗽𝗼𝗿𝘁𝘀 𝗶𝗻 𝟵𝟬 𝗠𝗮𝗿𝗸𝗲𝘁𝘀, 𝗠𝗼𝘀𝘁𝗹𝘆 𝗦𝗵𝗼𝗿𝘁 𝗗𝗲𝗮𝗹𝘀 Gray now carries local professional sports in 90 of its markets, LaPlatney said, after adding the Hornets, Blues, Timberwolves, Cavaliers and Magic. Asked how many contracts run several years, he said "A small percentage are multi-year", because leagues are negotiating national deals that will shape local ones. Digital revenue grew 12%, and the move of Gray's video apps to the Quickplay platform stays on track. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗙𝗿𝗲𝗲 𝗰𝗮𝘀𝗵 𝗳𝗹𝗼𝘄 (𝗻𝗶𝗻𝗲 𝗺𝗼𝗻𝘁𝗵𝘀): $𝟭𝟴𝟳 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Cash from operations minus capital spending rose to $187 million from $112 million a year ago. The third quarter alone produced $99 million by our math, against an outflow a year earlier, as prepaid political advertising arrived. Working capital still absorbed $109 million over nine months, mostly a drop in accrued interest and a rise in prepaid taxes. 𝗦𝘁𝗮𝘁𝗶𝗼𝗻 𝗲𝘅𝗽𝗲𝗻𝘀𝗲𝘀 𝗮𝘀 𝗮 𝘀𝗵𝗮𝗿𝗲 𝗼𝗳 𝗿𝗲𝘃𝗲𝗻𝘂𝗲: 𝟯𝟵.𝟭% ⇘ decelerating Station running costs, the pay and overhead of the local stations, took 39.1 cents of every revenue dollar, down from 43.8 a year ago. Political revenue carries almost no extra cost, so the share fell even though the dollar amount rose, acquired stations included. In dollars, station costs reached $380 million. Network fees fell to 22.2% of revenue from 28.6%. 𝗗𝗲𝗳𝗲𝗿𝗿𝗲𝗱 𝗿𝗲𝘃𝗲𝗻𝘂𝗲: $𝟱𝟴 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Cash that customers paid before their ads aired nearly tripled from $20 million in December. Almost all of it is political deposits, which rose to $44 million from $7 million. Political advertisers pay in advance, so this balance shows fourth-quarter political revenue already in hand at the end of September. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝗖𝗼𝗿𝗲 𝗮𝗱𝘃𝗲𝗿𝘁𝗶𝘀𝗶𝗻𝗴 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 (𝗤𝟰 𝗮𝗻𝗱 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿): 𝗤𝟰: 𝗱𝗼𝘄𝗻 𝗹𝗼𝘄-𝘀𝗶𝗻𝗴𝗹𝗲 𝘁𝗼 𝗺𝗶𝗱-𝘀𝗶𝗻𝗴𝗹𝗲 𝗱𝗶𝗴𝗶𝘁𝘀 𝘃𝘀 $𝟯𝟵𝟮𝗠; 𝗙𝗬: 𝗳𝗹𝗮𝘁 𝘁𝗼 𝗱𝗼𝘄𝗻 𝗹𝗼𝘄-𝘀𝗶𝗻𝗴𝗹𝗲 𝗱𝗶𝗴𝗶𝘁𝘀 𝘃𝘀 $𝟭,𝟰𝟱𝟮𝗠 ⇘ decelerating New. The plan has regular advertising falling again in the fourth quarter, even with the acquired stations included. By our math the middle of the range is about $378 million. Without the acquisitions that is roughly 10% below last year. Management attributes the drop to campaigns taking the airtime; the first-quarter outlook in February will show whether demand returns once they leave. 𝗣𝗼𝗹𝗶𝘁𝗶𝗰𝗮𝗹 𝗮𝗱𝘃𝗲𝗿𝘁𝗶𝘀𝗶𝗻𝗴 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 (𝗤𝟰 𝗮𝗻𝗱 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿): 𝗤𝟰: $𝟯𝟭𝟵-𝟯𝟮𝟵𝗠; 𝗙𝗬: $𝟲𝟯𝟬-𝟲𝟰𝟬𝗠 ⇗ accelerating New. The plan puts fourth-quarter political revenue at $319-329 million, about 30% above the last presidential-year fourth quarter. Election day fell on November 3, so Gray had booked almost all of it before reporting. The company has beaten its own political range in every quarter of this cycle, by 17% on average by our math. 𝗧𝗼𝘁𝗮𝗹 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 (𝗤𝟰 𝗮𝗻𝗱 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿): 𝗤𝟰: $𝟭,𝟭𝟭𝟱-𝟭,𝟭𝟰𝟬𝗠; 𝗙𝗬: $𝟯,𝟲𝟵𝟱-𝟯,𝟳𝟮𝟬𝗠 ⇗ accelerating New. The outlook calls for about $1.13 billion in the fourth quarter, up 42% from a year ago. The full-year range means a fifth more revenue than in 2025. By our math revenue other than political would grow about 3% in the fourth quarter, all of it from acquired stations. Gray has beaten the middle of its quarterly revenue range in two of the last three quarters. 𝗡𝗲𝘁 𝗿𝗲𝘁𝗿𝗮𝗻𝘀𝗺𝗶𝘀𝘀𝗶𝗼𝗻 𝗿𝗲𝘃𝗲𝗻𝘂𝗲 (𝗤𝟰 𝗮𝗻𝗱 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿): 𝗤𝟰: $𝟭𝟱𝟮-𝟭𝟱𝟱𝗠; 𝗙𝗬: $𝟱𝟵𝟰-𝟱𝟵𝟳𝗠 ⇒ stable 🠆 unchanged from Growth in 2026 on a reported and organic basis (second-quarter investor presentation) Unchanged in direction, now with numbers. The fourth-quarter range means about 15% growth from a year ago, in line with this quarter. The full-year figure matches the $595 million of 2023, which Howell called the company's high. Gignac said the stream should accelerate into 2027 because all distributor contracts are in place until then. 𝗕𝗿𝗼𝗮𝗱𝗰𝗮𝘀𝘁𝗶𝗻𝗴 𝗲𝘅𝗽𝗲𝗻𝘀𝗲𝘀 (𝗤𝟰 𝗮𝗻𝗱 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿): 𝗤𝟰: $𝟲𝟯𝟬-𝟲𝟰𝟬𝗠; 𝗙𝗬: $𝟮,𝟯𝟱𝟬-𝟮,𝟯𝟲𝟬𝗠 ⇗ accelerating New. Station costs rise about 14% from a year ago in the fourth quarter, faster than the 10% increase this quarter. Gray does not break down the increase, though the ASM and WHPM stations it operates under management agreements are now included. LaPlatney said the costs of acquired stations should fall materially from this quarter's level as integration proceeds. 𝗖𝗼𝗿𝗽𝗼𝗿𝗮𝘁𝗲 𝗮𝗻𝗱 𝗮𝗱𝗺𝗶𝗻𝗶𝘀𝘁𝗿𝗮𝘁𝗶𝘃𝗲 𝗲𝘅𝗽𝗲𝗻𝘀𝗲𝘀 (𝗤𝟰 𝗮𝗻𝗱 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿): 𝗤𝟰: $𝟯𝟱-𝟰𝟬𝗠; 𝗙𝗬: $𝟭𝟰𝟮-𝟭𝟰𝟳𝗠 ⇒ stable New. Corporate overhead rises to $35-40 million in the fourth quarter, from $28 million a year ago. Deal-related professional fees drive the increase; they ran to $12 million over nine months. For the year the range means about $145 million, up from $113 million last year. 𝗜𝗻𝘁𝗲𝗿𝗲𝘀𝘁 𝗲𝘅𝗽𝗲𝗻𝘀𝗲, 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿 (𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗮𝗺𝗼𝗿𝘁𝗶𝘇𝗮𝘁𝗶𝗼𝗻 𝗼𝗳 𝗱𝗲𝗳𝗲𝗿𝗿𝗲𝗱 𝗳𝗶𝗻𝗮𝗻𝗰𝗶𝗻𝗴 𝗰𝗼𝘀𝘁𝘀): $𝟰𝟱𝟬𝗠 ⇒ stable 🠅 raised from $440M Raised. This year's interest bill is $10 million higher than the August plan, even though the refinancing replaced the most expensive notes with cheaper ones. Gray gave no reason in the release. Howell expects at least $40 million less next year. The filing estimates $430 million of interest payments over the next twelve months. 𝗔𝗺𝗼𝗿𝘁𝗶𝘇𝗮𝘁𝗶𝗼𝗻 𝗼𝗳 𝗱𝗲𝗳𝗲𝗿𝗿𝗲𝗱 𝗳𝗶𝗻𝗮𝗻𝗰𝗶𝗻𝗴 𝗰𝗼𝘀𝘁𝘀, 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿: $𝟭𝟰𝗠 ⇒ stable 🠇 cut from $16M Cut by $2 million. This non-cash charge spreads past loan fees over the life of the debt. It falls because Gray retired the related notes early and wrote off the remaining balance inside the $40 million loss on early extinguishment. 𝗣𝗿𝗲𝗳𝗲𝗿𝗿𝗲𝗱 𝘀𝘁𝗼𝗰𝗸 𝗱𝗶𝘃𝗶𝗱𝗲𝗻𝗱𝘀, 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿: $𝟱𝟬𝗠 ⇒ stable 🠆 unchanged from $50M Unchanged. Gray pays 8% a year on $600 million of preferred shares. The figure sits $2 million below the original plan after a June buyback. Gray paid $30 million for $50 million of face value. Gignac said that saves $4 million a year. 𝗖𝗼𝗺𝗺𝗼𝗻 𝘀𝘁𝗼𝗰𝗸 𝗱𝗶𝘃𝗶𝗱𝗲𝗻𝗱𝘀, 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿: $𝟯𝟯𝗠 ⇒ stable 🠆 unchanged from $33M Unchanged at $0.08 a share each quarter, about $33 million a year. Gray keeps paying it alongside the preferred dividend while it calls debt reduction the priority. 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗲𝘅𝗽𝗲𝗻𝗱𝗶𝘁𝘂𝗿𝗲𝘀, 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿: $𝟭𝟭𝟬-𝟭𝟮𝟬𝗠 ⇘ decelerating 🠇 cut from $120-130M Cut for the second time, from $140 million in February. Gignac said a couple of station construction projects moved into 2027, so Gray deferred the spending rather than saving it. Nine-month spending was $71 million, which leaves about $44 million for the fourth quarter at the middle of the range. 𝗜𝗻𝗰𝗼𝗺𝗲 𝘁𝗮𝘅 𝗽𝗮𝘆𝗺𝗲𝗻𝘁𝘀, 𝗻𝗲𝘁 𝗼𝗳 𝗿𝗲𝗳𝘂𝗻𝗱𝘀, 𝗳𝘂𝗹𝗹 𝘆𝗲𝗮𝗿: $𝟳𝟱-𝟴𝟱𝗠 ⇘ decelerating 🠇 cut from $80-100M Cut for the third time this year, from $105-125 million in February. Gray paid $60 million over nine months, so the range leaves about $20 million for the fourth quarter, which matches the figure in the filing. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗪𝗵𝘆 𝗱𝗼𝗲𝘀 𝘁𝗵𝗶𝘀 𝘆𝗲𝗮𝗿'𝘀 𝗶𝗻𝘁𝗲𝗿𝗲𝘀𝘁 𝗯𝗶𝗹𝗹 𝗿𝗶𝘀𝗲 𝘁𝗼 $𝟰𝟱𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻? Gray swapped its most expensive notes for cheaper ones and promises $40 million of savings next year. Yet it raised this year's interest outlook by $10 million without explanation. The answer shows whether old and new debt overlapped or something else is the cause. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗼𝗳 𝘁𝗵𝗲 $𝟭𝟲𝟭 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝗮𝗱𝗱-𝗯𝗮𝗰𝗸 𝗶𝘀 𝗿𝗲𝗮𝗹 𝘆𝗲𝘁? The covenant leverage ratio rests on a profit denominator with $161 million of pro forma adjustments, up from $144 million in June. Gignac says synergies are 75-80% in the run rate; the quarter's reported numbers should show which part is already booked. 𝗪𝗵𝗮𝘁 𝘄𝗶𝗹𝗹 𝗰𝗹𝗼𝘀𝗶𝗻𝗴 𝘁𝗵𝗲 𝗽𝗲𝗻𝘀𝗶𝗼𝗻 𝗽𝗹𝗮𝗻 𝗰𝗼𝘀𝘁? The plan terminated on October 1, with a group annuity purchase planned for 2028. The filing says the settlement charge is still under evaluation; a cash top-up would compete with debt reduction in the political-free year. 𝗪𝗵𝗮𝘁 𝗱𝗶𝗱 𝗚𝗿𝗮𝘆 𝗽𝗮𝘆 𝗳𝗼𝗿 𝘁𝗵𝗲 𝗮𝗰𝗾𝘂𝗶𝗿𝗲𝗱 𝘀𝘁𝗮𝘁𝗶𝗼𝗻𝘀' 𝗲𝗮𝗿𝗻𝗶𝗻𝗴𝘀? The 2026 deals cost about $330 million in total, and the stations run at a thinner margin than the group before synergies. Without purchase multiples or a target margin, nobody outside the company can check the deleveraging the deals promise. 𝗪𝗵𝗲𝗿𝗲 𝗱𝗼 𝘁𝗵𝗲 𝗔𝘀𝘀𝗲𝗺𝗯𝗹𝘆 𝗔𝘁𝗹𝗮𝗻𝘁𝗮 𝗹𝗮𝗻𝗱 𝗱𝗲𝗮𝗹𝘀 𝘀𝘁𝗮𝗻𝗱? Management promised joint ventures on the studio land throughout 2026. Gray has announced none, the production segment only broke even this quarter, and nobody on the call asked.

$EMA Q3 2026 earnings: Emera lifts its growth target, but new shares fund it Emera's utilities earned more, but head-office costs and a larger share count left profit per share slightly lower. Profit per share excluding one-offs slipped 3% to $0.85, though by our math it rose about 3% without a hedge timing loss. Chief executive Scott Balfour unveiled a bigger five-year investment plan and a higher growth target, funded partly by new shares. • Profit per share, excluding one-offs: $𝟬.𝟴𝟱 (−3% from a year ago; +3% without the hedge timing, by our math) • Five-year investment plan: $𝟮𝟭.𝟱𝗕 (up $1.1B from the previous plan) • Rate base growth outlook: 𝟳.𝟱–𝟴.𝟱% 𝗮 𝘆𝗲𝗮𝗿 (7–8% in the previous plan) • New shares to fund the plan: ~$𝟲𝟬𝟬𝗠 𝗮 𝘆𝗲𝗮𝗿 (10–15% of funding) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🟢 Bullish The story got better because the investment plan and the growth target both rose, and the rating agencies eased their downgrade lines. The bad news: with asset sales finished, new shares now fund a bigger slice of the plan, and Emera will not say until February what that means per share. The question now is whether faster rate base growth reaches shareholders after Emera counts the extra shares. If data centers and the merger spread costs over more demand, profit per share keeps pace; if not, new shares absorb much of the growth. February's restated profit target will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢🟢 𝗘𝗺𝗲𝗿𝗮 𝗥𝗮𝗶𝘀𝗲𝘀 𝗜𝘁𝘀 𝗙𝗶𝘃𝗲-𝗬𝗲𝗮𝗿 𝗜𝗻𝘃𝗲𝘀𝘁𝗺𝗲𝗻𝘁 𝗣𝗹𝗮𝗻 Emera earns a regulated return on the power and gas assets it builds, so the size of its investment plan sets its growth. Chief executive Scott Balfour unveiled a new five-year plan of $21.5 billion, up $1.1 billion. Balfour said the rate base, the assets regulators let Emera earn on, should grow 7.5% to 8.5% a year, up from 7% to 8%. The largest project is a 720 megawatt rebuild of the Big Bend 4 plant. • Florida share: about 82%, or $17.5 billion • Years 2027 to 2030: $930 million above the previous plan by our math, with 2027 alone up $500 million This matters because every dollar added to the rate base earns a regulated return. Balfour said "the investment opportunities are outpacing that kind of growth, at least in the short term". But the comparison flatters a little: the window moved forward a year, and the target now starts from 2025, not 2024. What to watch: the profit growth target Emera restates in February, once it counts the plan's share issuance. A target still at 5% to 7% would confirm the bigger plan reaches shareholders. 🟢 𝗖𝗿𝗲𝗱𝗶𝘁 𝗔𝗴𝗲𝗻𝗰𝗶𝗲𝘀 𝗚𝗶𝘃𝗲 𝗘𝗺𝗲𝗿𝗮 𝗠𝗼𝗿𝗲 𝗥𝗼𝗼𝗺 Emera carries about $21.6 billion of debt, and its thin credit cushion was the standing worry. Moody's downgrade line sat at 12% cash flow to debt, which Emera only expected to reach this year. Finance chief Jared Green said "Moody's recently lowered our downgrade threshold from 12% to 11%", citing lower business risk. Fitch will follow once the merger closes, Green said. This matters because a wider cushion means a storm or a rate setback no longer forces an emergency share sale. But 12% is still a plan, and the agencies count hybrid notes only half as equity. What to watch: the year-end cash flow to debt ratio in February. At 12% or more, a full point would separate Emera from the downgrade line. 🟢 𝗧𝗮𝗺𝗽𝗮 𝗘𝗹𝗲𝗰𝘁𝗿𝗶𝗰 𝗡𝗲𝗮𝗿𝘀 𝗜𝘁𝘀 𝗙𝗶𝗿𝘀𝘁 𝗗𝗮𝘁𝗮 𝗖𝗲𝗻𝘁𝗲𝗿 𝗖𝗼𝗻𝘁𝗿𝗮𝗰𝘁 Tampa Electric, Emera's Florida utility, says data centers can lower bills for everyone if they pay their way. On September 30 it filed a tariff for customers taking up to 1,000 megawatts. Balfour said Tampa Electric has studied about 1,300 megawatts of potential demand and aims to sign the first 350 by year-end at Hillwood's Auburndale site. "The buildings are built," its management said; Green put connection costs "in the tens of millions of dollars". Balfour said "each additional 100 MW represents approximately 2% growth in system demand". The plan counts only the first 350 megawatts, so anything more is growth not yet in the numbers. What to watch: a signed Hillwood contract by year-end and the tariff decision in early 2027. Both would turn the pipeline into rate base. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗡𝗲𝘄 𝗦𝗵𝗮𝗿𝗲𝘀 𝗪𝗶𝗹𝗹 𝗣𝗮𝘆 𝗳𝗼𝗿 𝘁𝗵𝗲 𝗕𝗶𝗴𝗴𝗲𝗿 𝗣𝗹𝗮𝗻 Emera funds its plan with cash from operations, utility debt and new shares. Green said that "despite the increase in capital, our funding strategy remains largely unchanged". The numbers say otherwise. "Equity will continue to play a small role in our funding plan," Green said. That role is now about $600 million a year, "with issuances weighted towards the 2027 through 2029 period", since asset sales have ended. • Shares outstanding: 307.7 million on average, up 2.6% from a year ago • Profit excluding one-offs this quarter: down 1%; per share, down 3% • Hybrid notes: about $1.25 billion, which the rating agencies count half as equity Rate base growth only reaches shareholders after Emera counts the new shares. Its own target already turns 7% to 8% rate base growth into 5% to 7% profit growth; more shares widen that gap. Green said it was too early to say what the plan means for that target. What to watch: the restated profit target in February, after $600 million a year of share sales. A target at the bottom of 5% to 7% would mean shareholders fund growth they do not fully receive. 🔴 𝗛𝗲𝗮𝗱-𝗢𝗳𝗳𝗶𝗰𝗲 𝗖𝗼𝘀𝘁𝘀 𝗔𝘁𝗲 𝘁𝗵𝗲 𝗨𝘁𝗶𝗹𝗶𝘁𝗶𝗲𝘀' 𝗚𝗿𝗼𝘄𝘁𝗵 Emera's utilities earned more this quarter, but the holding company's own costs rose faster. Earnings before corporate costs rose 5% to $376 million. Corporate costs climbed to $116 million from $96 million. • Corporate operating costs: $32 million, double a year ago, on a hedge loss and New York listing costs • Incentive hedge timing: a $0.06 per share swing against last year The hedge loss is timing and reverses, so by our math profit per share rose about 3% without it. Interest does not: it is up $31 million this year, because debt grew despite the New Mexico Gas proceeds. What to watch: fourth-quarter corporate costs. A quarter where the hedge timing reverses but interest still grows would show how much of the drag is permanent. 🔴 𝗡𝗼𝘃𝗮 𝗦𝗰𝗼𝘁𝗶𝗮 𝗣𝗼𝘄𝗲𝗿 𝗦𝘁𝗶𝗹𝗹 𝗠𝗶𝘀𝘀𝗲𝘀 𝗜𝘁𝘀 𝗔𝗹𝗹𝗼𝘄𝗲𝗱 𝗥𝗲𝘁𝘂𝗿𝗻 Nova Scotia Power, Emera's Canadian utility, may earn 8.75% to 9.25% on equity. But it "anticipates earning below its allowed ROE range in 2026", the filing said. Profit so far this year is $87 million, down from $119 million. The quarter's gain leaned on $12 million of deferred financing costs. The utility has asked to securitise about $1 billion of retiring coal plant and other costs, which Balfour said saves customers about $265 million. The province also ordered a study of performance-based regulation, which Balfour said must recognise "earning a fair return and the financial health of the utility". What to watch: the securitisation decision, due by early December, and the 2.5% rate rise on January 1. Both would give it a chance to earn its allowed return next year. 🔴 𝗥𝗶𝘀𝗸𝘀 𝗧𝗵𝗶𝘀 𝗤𝘂𝗮𝗿𝘁𝗲𝗿 𝗗𝗶𝗱𝗻'𝘁 𝗔𝗻𝘀𝘄𝗲𝗿 Two standing concerns got no decisive reading this quarter, because the events that would test them fall in the fourth quarter or later. Each item below names the reading that would move it. • Florida concentration: 82% of the plan sits in one state. Weather cost $0.04 a share at Tampa Electric this quarter. The Florida Supreme Court heard the 2024 rate case appeal on October 7 and has not ruled. • Trading and currency: Emera Energy Services lost $3 million this quarter. Its outlook of USD 60 million to 80 million needs a strong fourth quarter. A weaker Canadian dollar added $2 million, and Emera has hedged only 52% of next year's US earnings. 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗘𝗺𝗲𝗿𝗮 𝗮𝗻𝗱 𝗖𝗮𝗻𝗮𝗱𝗶𝗮𝗻 𝗨𝘁𝗶𝗹𝗶𝘁𝗶𝗲𝘀 𝗦𝗲𝘁 𝗮 𝟮𝟬𝟮𝟳 𝗖𝗹𝗼𝘀𝗶𝗻𝗴 Emera announced on October 6 an all-share deal to buy Canadian Utilities and ATCO, valued at about $14.3 billion. Emera holders would own 60.8% of the combined company. Balfour called it "positioning us for the growth ahead" in Alberta. The main filing went to the Alberta Utilities Commission on October 27, and the companies expect to close in the second half of 2027. Deal costs were $5 million this quarter. 𝗘𝗺𝗲𝗿𝗮 𝗛𝗮𝘀 𝗙𝗶𝗻𝗶𝘀𝗵𝗲𝗱 𝗦𝗲𝗹𝗹𝗶𝗻𝗴 𝗔𝘀𝘀𝗲𝘁𝘀 Emera closed the New Mexico Gas sale in August for $940 million in cash and a $12 million gain after tax. It sold Grand Bahama Power in May at a $24 million loss. Green said "We are no longer forecasting proceeds from asset sales in this plan". Two appeals of the New Mexico approval sit with the state's Supreme Court, with a decision on a threshold issue expected in 2027. — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗙𝗹𝗼𝗿𝗶𝗱𝗮 𝗘𝗹𝗲𝗰𝘁𝗿𝗶𝗰 𝗨𝘁𝗶𝗹𝗶𝘁𝘆 𝗲𝗮𝗿𝗻𝗶𝗻𝗴𝘀 (𝟮𝟲𝗤𝟯): 𝗨𝗦𝗗 𝟮𝟭𝟳 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating Tampa Electric's profit slipped in US dollars, to $217 million from $220 million, though it rose in Canadian dollars. Growth has slowed from 20% a year ago as last year's rate rise laps. This quarter, weather cost $0.04 a share and a settlement cut fuel recovery by $10 million. 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗰𝗮𝘀𝗵 𝗳𝗹𝗼𝘄 𝗯𝗲𝗳𝗼𝗿𝗲 𝘄𝗼𝗿𝗸𝗶𝗻𝗴 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 (𝗻𝗶𝗻𝗲 𝗺𝗼𝗻𝘁𝗵𝘀): $𝟮,𝟭𝟭𝟯 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable Cash from operations before working capital rose 7% to $2,113 million in nine months. Reported operating cash flow was $2,428 million because working capital added $315 million, mostly fuel over-recoveries at Tampa Electric that customers get back later. Capital spending of $2,748 million still exceeded both figures. 𝗧𝗼𝘁𝗮𝗹 𝗱𝗲𝗯𝘁 (𝗦𝗲𝗽𝘁𝗲𝗺𝗯𝗲𝗿 𝟯𝟬): $𝟮𝟭.𝟲 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable Total debt edged up $124 million since December despite $940 million of cash from the New Mexico Gas sale, because capital spending outran cash flow. Cash on hand was $600 million. By our math the holding company carries about 34% of the debt, against a stated aim of below a third. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝟮𝟬𝟮𝟲 𝗽𝗿𝗼𝗳𝗶𝘁 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲 𝗲𝘅𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗼𝗻𝗲-𝗼𝗳𝗳𝘀: 𝗚𝗿𝗼𝘄𝘁𝗵 𝗮𝗯𝗼𝘃𝗲 𝟱-𝟳% 𝗮 𝘆𝗲𝗮𝗿, 𝗺𝗲𝗮𝘀𝘂𝗿𝗲𝗱 𝗼𝘃𝗲𝗿 𝘁𝘄𝗼 𝘆𝗲𝗮𝗿𝘀 𝗳𝗿𝗼𝗺 𝟮𝟬𝟮𝟰 ⇘ decelerating 🠆 unchanged from Growth above 5-7% a year from 2024 Unchanged. The plan still calls for two-year growth above 7% from the 2024 base. By our math that is a floor of about $3.37 for the year. After $2.90 in nine months, the fourth quarter needs only about $0.47. That compares with $0.55 a year ago, so the outlook tolerates a 15% drop while still reading as growth. 𝗣𝗿𝗼𝗳𝗶𝘁 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲 𝗴𝗿𝗼𝘄𝘁𝗵 𝘁𝗵𝗿𝗼𝘂𝗴𝗵 𝟮𝟬𝟯𝟬: 𝟱-𝟳% 𝗮 𝘆𝗲𝗮𝗿 𝗼𝗻 𝗮𝘃𝗲𝗿𝗮𝗴𝗲 𝗳𝗿𝗼𝗺 𝟮𝟬𝟮𝟰 ⇒ stable 🠆 unchanged from 5-7% a year on average from 2024 Unchanged. Emera kept the 5% to 7% target and will restate it from a new starting point in February. Last year's profit per share was $3.49. By our math the range for 2030 then needs only 2.5% to 5% a year from here, so the target is easier than it reads. 𝗥𝗮𝘁𝗲 𝗯𝗮𝘀𝗲 𝗴𝗿𝗼𝘄𝘁𝗵 𝟮𝟬𝟮𝟱-𝟮𝟬𝟯𝟭: 𝟳.𝟱-𝟴.𝟱% 𝗮 𝘆𝗲𝗮𝗿 ⇗ accelerating 🠅 raised from 7-8% a year (2024-2030) Raised. Emera now expects the rate base to grow 7.5% to 8.5% a year, up from 7% to 8%. The base year moved to 2025, so last year's 8% rise drops out. By our math the yearly path runs about 10% this year and slows to 6% by the end of the plan. The range describes the average, not the finish. 𝗙𝗶𝘃𝗲-𝘆𝗲𝗮𝗿 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝗽𝗹𝗮𝗻 𝟮𝟬𝟮𝟳-𝟮𝟬𝟯𝟭: $𝟮𝟭.𝟱 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating 🠅 raised from $20.4 billion (2026-2030) Raised. The plan is $1.1 billion, or 5%, above the one it replaces. It is the third raise in three updates and the largest: +$0.16B, +$0.24B, +$1.07B. The window also moved forward a year. On the overlapping years the increase is $930 million by our math, most of it in 2027. 𝟮𝟬𝟮𝟲 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝗶𝗻𝘃𝗲𝘀𝘁𝗺𝗲𝗻𝘁: 𝗔𝗯𝗼𝘂𝘁 $𝟰.𝟬 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating 🠆 unchanged from About $4.0 billion ($4,020 million forecast) Unchanged. Emera has spent $2.8 billion in nine months. By our math the fourth quarter needs about $1.2 billion, a fifth more than the third quarter. Spending has stepped up each quarter this year, so the plan looks reachable. 𝗗𝗶𝘃𝗶𝗱𝗲𝗻𝗱 𝗴𝗿𝗼𝘄𝘁𝗵: 𝟭-𝟮% 𝗮 𝘆𝗲𝗮𝗿 ⇒ stable 🠆 unchanged from 1-2% a year Unchanged. The board lifted the annual rate by 1% to $2.96, the twentieth straight increase and the bottom of the range. Balfour said "It's too soon to be thinking about changing the dividend growth rate." The slow rise is deliberate: dividends were 76% of profit excluding one-offs in the first nine months. 𝗙𝘂𝗻𝗱𝗶𝗻𝗴 𝗼𝗳 𝘁𝗵𝗲 𝟮𝟬𝟮𝟳-𝟮𝟬𝟯𝟭 𝗽𝗹𝗮𝗻: 𝗖𝗮𝘀𝗵 𝗳𝗹𝗼𝘄 𝟰𝟱-𝟱𝟬%; 𝘂𝘁𝗶𝗹𝗶𝘁𝘆 𝗱𝗲𝗯𝘁 𝟯𝟬-𝟯𝟱%; 𝗻𝗲𝘄 𝘀𝗵𝗮𝗿𝗲𝘀 𝟭𝟬-𝟭𝟱% (𝗮𝗯𝗼𝘂𝘁 $𝟲𝟬𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝗮 𝘆𝗲𝗮𝗿); 𝗵𝘆𝗯𝗿𝗶𝗱𝘀 𝟱-𝟳%; 𝗻𝗼 𝗮𝘀𝘀𝗲𝘁 𝘀𝗮𝗹𝗲𝘀 ⇒ stable New. Green said reinvested cash flow stays the largest source and new shares a small one. But the asset sales that helped fund the last plan have ended, so share issuance rises in dollars and falls mostly in 2027 through 2029. Hybrid notes of about $1.25 billion fill the rest, which the rating agencies count half as equity. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗼𝗳 𝘁𝗵𝗲 𝗯𝗶𝗴𝗴𝗲𝗿 𝗽𝗹𝗮𝗻 𝗶𝘀 𝗰𝘂𝗿𝗿𝗲𝗻𝗰𝘆? Every 5 cents on the exchange rate moves the five-year total by about $695 million, and the plan assumes a stronger Canadian dollar than today's. Readers need the increase at a constant rate to judge the real raise. 𝗜𝘀 𝗵𝗼𝗹𝗱𝗶𝗻𝗴-𝗰𝗼𝗺𝗽𝗮𝗻𝘆 𝗱𝗲𝗯𝘁 𝗮𝗯𝗼𝘃𝗲 𝘁𝗵𝗲 𝗼𝗻𝗲-𝘁𝗵𝗶𝗿𝗱 𝗰𝗲𝗶𝗹𝗶𝗻𝗴? The presentation puts holding-company debt at about 34% of the total by our math, while the funding slide says the aim is below 33%. Emera should say which measure it uses and how the hybrids count. 𝗪𝗵𝗮𝘁 𝗽𝗿𝗼𝗳𝗶𝘁 𝗴𝗿𝗼𝘄𝘁𝗵 𝗱𝗼𝗲𝘀 𝘁𝗵𝗲 𝗻𝗲𝘄 𝗽𝗹𝗮𝗻 𝗱𝗲𝗹𝗶𝘃𝗲𝗿 𝗽𝗲𝗿 𝘀𝗵𝗮𝗿𝗲? Emera will restate its profit target in February. With about $600 million a year of new shares, the number that matters is growth per share, not rate base growth. 𝗛𝗼𝘄 𝗹𝗮𝗿𝗴𝗲 𝗰𝗮𝗻 𝘁𝗵𝗲 𝗔𝘂𝗯𝘂𝗿𝗻𝗱𝗮𝗹𝗲 𝗱𝗮𝘁𝗮 𝗰𝗲𝗻𝘁𝗲𝗿 𝘀𝗶𝘁𝗲 𝗯𝗲𝗰𝗼𝗺𝗲? Tampa Electric said the site can take 700 megawatts and may reach 1,000. The capital, timing and rate base effect beyond the first 350 megawatts are not in the plan. 𝗪𝗶𝗹𝗹 𝗡𝗼𝘃𝗮 𝗦𝗰𝗼𝘁𝗶𝗮 𝗣𝗼𝘄𝗲𝗿 𝗲𝗮𝗿𝗻 𝗶𝘁𝘀 𝗮𝗹𝗹𝗼𝘄𝗲𝗱 𝗿𝗲𝘁𝘂𝗿𝗻 𝗶𝗻 𝟮𝟬𝟮𝟳? The 2.5% rate increase and the securitisation both start in January. Emera has not said whether, together, they close the gap to the 8.75% to 9.25% allowed range.

$OKLO Q3 2026 earnings: Oklo builds quickly, but its first plant may start later Oklo's construction is moving quickly, but its first power plant now has a later start date. Steel is going up at Aurora-ID in Idaho, and chief executive Jacob DeWitte priced the Groves-1 test reactor at about $75 million. Quarterly spending on plants reached $154 million, funded by new shares sold at about $42 each, half the earlier price. • Cash spent on plants and equipment: $𝟭𝟱𝟰.𝟬𝗠 ($94.1M last quarter, by our math) • Operating loss, excluding a land-sale gain: $𝟴𝟮.𝟰𝗠 ($36.3M a year ago) • Cash and securities: $𝟯.𝟭𝟯𝗕 (after $402M of new share sales in the quarter) • Full-year cash outlook: 𝗨𝗻𝗰𝗵𝗮𝗻𝗴𝗲𝗱 ($120–150M for operations, $400–500M for plants) ⚖️ 𝗩𝗲𝗿𝗱𝗶𝗰𝘁: 🔴 Bearish The story got worse because the filing moved the first plant to a 2028–2029 target and DeWitte accepted that reads as a delay. Each year of delay means more share sales at lower prices. The good news: Ohio's fuel moved from a letter of intent to a signed supply agreement, with Meta paying Centrus directly. The question now is whether 2029 is a buffer or the real date. If the reactor components go in on schedule, the extra year is insurance; if the cost estimate arrives with another date, the delay is structural. The annual report in March will tell. Full article with charts - link in bio 🐂 𝗕𝘂𝗹𝗹 𝗖𝗮𝘀𝗲 🟢 𝗢𝗸𝗹𝗼'𝘀 𝗙𝗶𝗿𝘀𝘁 𝗥𝗲𝗮𝗰𝘁𝗼𝗿 𝗖𝗼𝘀𝘁 𝗔𝗯𝗼𝘂𝘁 $𝟳𝟱 𝗠𝗶𝗹𝗹𝗶𝗼𝗻 Groves-1 is a small test reactor in Texas that Oklo built to learn isotope production. Chief executive Jacob DeWitte priced it this quarter: "The build cost was approximately $65 million, plus approximately $10 million for commercially sourced fuel from Framatome." The same team is now building Aurora-ID, the 75-megawatt plant in Idaho. "By November 4th, structural steel was going up," DeWitte said; at the fuel workshop, "Facility equipment installation is underway." This matters because Oklo's plan rests on building faster and cheaper than the industry has. But a low-power test unit says little about a full power plant's cost. What to watch: the total cost of Aurora-ID, which finance chief Craig Bealmear said last quarter would come once it firmed up. That figure shows whether the Groves-1 discipline carries over. 🟢 𝗠𝗲𝘁𝗮'𝘀 𝗠𝗼𝗻𝗲𝘆 𝗡𝗼𝘄 𝗣𝗮𝘆𝘀 𝗖𝗲𝗻𝘁𝗿𝘂𝘀 𝗳𝗼𝗿 𝗢𝗸𝗹𝗼'𝘀 𝗙𝘂𝗲𝗹 Oklo's reactors need HALEU, a more enriched uranium that few suppliers make. Until this quarter Oklo held only a non-binding letter of intent with Centrus, the Ohio enricher. On September 30 Oklo signed a Centrus supply agreement, "subject to certain conditions", for the Ohio plants planned with Meta. On November 2 Meta's first payment left escrow and went "directly to Centrus as a credit towards fuel orders". A customer paying the supplier commits harder than a letter of intent. But the first plant runs on material Oklo already holds; Centrus and plutonium decide whether Oklo can fuel the next ones. What to watch: the Centrus conditions clearing, and the plutonium timeline, which DeWitte expects to "become a lot clearer in the next few months". Either gives Ohio's fuel a date. 🟢 𝗢𝗸𝗹𝗼'𝘀 𝗔𝗰𝗾𝘂𝗶𝗿𝗲𝗱 𝗘𝗻𝗴𝗶𝗻𝗲𝗲𝗿𝘀 𝗡𝗼𝘄 𝗪𝗼𝗿𝗸 𝗼𝗻 𝗔𝘂𝗿𝗼𝗿𝗮-𝗜𝗗 In June Oklo bought two small engineering firms for $33.4 million: ARMEC, a precision machining shop, and Creative Engineers, which designs sodium-cooled equipment. DeWitte said ARMEC is already "supporting reactor module development at Aurora-ID". The two supplied all of Oklo's $1.9 million of revenue this quarter, from work for outside customers. They also lost $1.1 million between them, after Oklo described both last quarter as cash-generating. Oklo also used AI to adapt Aurora models for Groves in under a week, which DeWitte said "compressed months of modeling work into days". What to watch: any figure for savings on components Oklo now makes itself, and whether the two units earn a profit in the fourth quarter. A savings number matters more than the small sales side. 🐻 𝗕𝗲𝗮𝗿 𝗖𝗮𝘀𝗲 🔴🔴 𝗢𝗸𝗹𝗼'𝘀 𝗙𝗶𝗿𝘀𝘁 𝗣𝗹𝗮𝗻𝘁 𝗠𝗮𝘆 𝗦𝘁𝗮𝗿𝘁 𝗮 𝗬𝗲𝗮𝗿 𝗟𝗮𝘁𝗲𝗿 Aurora-ID is the plant everything else waits on: Oklo's first power revenue and the reference design for every plant after it. Oklo kept 2028 as the start date for a year. This quarter's filing changes that to "deploying our first powerhouse in 2028-2029". Asked whether that meant a modest delay to 2029, DeWitte agreed and cited Groves-1 lessons about testing a fully assembled plant. "Electrical noise management is a huge thing in nuclear plants," he said; Oklo wants "that buffer in there because time is going to take time". The slip matters because every year without power revenue is another year paid for by selling shares. The Ohio campus also leans on Aurora-ID's record for its NRC licence. The plant's total cost is still unpublished. DeWitte closed the call saying the site is "on pace to set a world record for fastest privately built fast reactor". The filing added a year in the same week. What to watch: the Documented Safety Analysis, which DeWitte does not expect to submit until 2028. The start-date wording in March's annual report will show whether 2029 is a buffer or the new plan. 🔴🔴 𝗢𝗸𝗹𝗼 𝗦𝗲𝗹𝗹𝘀 𝗦𝘁𝗼𝗰𝗸 𝗮𝘁 $𝟰𝟮 𝘁𝗼 𝗙𝘂𝗻𝗱 𝗦𝗽𝗲𝗻𝗱𝗶𝗻𝗴 Oklo has almost no revenue, so every dollar it spends on plants comes from investors. This quarter it spent $154 million on plants and equipment plus $45 million on operations, by our math from the year-to-date cash flows. To pay for that, Oklo sold 9.5 million new shares through its at-the-market programme. They brought in $402 million, about $42 a share after fees. That is under half the $96.95 from the programme completed in March. In September it opened a third programme. The first $87 million went out at $39.30 a share. • Shares outstanding: 195 million, up 25% from a year ago Bealmear said Oklo "proactively and intentionally raised capital" to commit to fuel and equipment early. But the lower the price per new share, the more of the company each plant costs existing holders. The same $402 million took more than twice as many shares as under the March programme. What to watch: fourth-quarter cash used in operations, in March's annual report. The full-year plan Bealmear reaffirmed needs it to fall well below the third-quarter level, so a repeat would put the year above the range. 🔴🔴 𝗢𝗸𝗹𝗼 𝗦𝘁𝗶𝗹𝗹 𝗛𝗮𝘀 𝗡𝗼 𝗕𝗶𝗻𝗱𝗶𝗻𝗴 𝗣𝗼𝘄𝗲𝗿 𝗖𝗼𝗻𝘁𝗿𝗮𝗰𝘁 Oklo plans to own its plants and sell power under long-term contracts, so a signed power purchase agreement would be the first sign of revenue. It still has none. Asked whether the Meta agreement for Ohio obliges Oklo to build, DeWitte said "it is not binding as is to build the reactor". Bealmear added there are "some binding elements to it": Meta's capital reserves capacity, and Oklo must hit milestones, starting with fuel. PJM, the regional grid operator, withdrew one of Oklo's Virginia connection applications, and the federal energy regulator dismissed Oklo's complaint. The Ohio study is "going to take place over the next 24 months", Bealmear said. • Customer prepayment on Oklo's books: $25 million since 2024; the buyer's right of first refusal ends around February 2027 by our math • Capacity in PJM's 2026 study: 900 megawatts A two-year study means Ohio cannot connect before late 2028. The agreement, as DeWitte describes it, does not yet oblige either side to a power sale. What to watch: a signed power purchase agreement with Meta, with a price and a delivery date. That would be the first revenue line anyone can model. 🔴 𝗥𝗶𝘀𝗸𝘀 𝘁𝗵𝗶𝘀 𝗾𝘂𝗮𝗿𝘁𝗲𝗿 𝗱𝗶𝗱𝗻'𝘁 𝗮𝗻𝘀𝘄𝗲𝗿 Several standing questions got no answer in the filing, the slides or the call. Each has a specific disclosure that would settle it. • Aurora-ID total cost: still unpublished; Bealmear said last quarter a number would come once it firmed up • Surplus plutonium: no volume or date; DeWitte expects the timeline to "become a lot clearer in the next few months" • Ohio first phase: the 150-megawatt-by-2030 target from the annual report has not reappeared in three quarterly filings • Eielson Air Force Base: ground investigations due in summer 2026; no update • First isotope revenue: now a target to "complete our first contracted isotope delivery" within twelve months, with no dollar figure • Policy: asked about the election and state limits on data centres, Bealmear said customers have not pulled back; nothing quantified 👓 𝗢𝘁𝗵𝗲𝗿 𝗧𝗵𝗲𝗺𝗲𝘀 𝗡𝗥𝗖 𝗪𝗶𝗹𝗹 𝗔𝗰𝗰𝗲𝗽𝘁 𝗢𝗸𝗹𝗼'𝘀 𝗗𝗢𝗘 𝗦𝗮𝗳𝗲𝘁𝘆 𝗘𝘃𝗶𝗱𝗲𝗻𝗰𝗲 On October 26 the Nuclear Regulatory Commission finalised a rule for reactors the Department of Energy has already authorised, which is Aurora-ID's route. A licence application can now draw on their safety analyses and operating data. Oklo said this "could reduce duplicative technical reviews and improve licensing efficiency". The NRC keeps full review authority, and no reactor has yet made that conversion. 𝗚𝗿𝗼𝘃𝗲𝘀-𝟮 𝗮𝗻𝗱 𝗮 𝗣𝗮𝗿𝘁𝘀 𝗗𝗲𝗮𝗹 𝗳𝗼𝗿 𝟮𝟳 𝗥𝗲𝗮𝗰𝘁𝗼𝗿𝘀 Two new programmes carry no revenue yet. Groves-2 Forge, a larger isotope plant that would irradiate, separate and package products, won a spot in the DOE's Nuclear Energy Launch Pad. Oklo has bought its fuel but is "still finalizing the site location". Oklo also reserved capacity for 27 reactor modules at U.S. Forged Rings through 2035, for what Bealmear called "an initial small investment". — • — • — 💲 𝗢𝘁𝗵𝗲𝗿 𝗞𝗣𝗜𝘀 𝗜𝗻𝘁𝗲𝗿𝗲𝘀𝘁 𝗮𝗻𝗱 𝗱𝗶𝘃𝗶𝗱𝗲𝗻𝗱 𝗶𝗻𝗰𝗼𝗺𝗲 (𝟮𝟲𝗤𝟯): $𝟮𝟳.𝟵 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Interest on Oklo's cash pile rose for a fifth straight quarter, to $27.9 million from $7.1 million a year ago. It now covers about a third of the operating loss before one-offs, against a fifth a year ago, because share sales enlarged the balance sheet. By our math the money earns about 3.6% a year. 𝗦𝘁𝗼𝗰𝗸-𝗯𝗮𝘀𝗲𝗱 𝗰𝗼𝗺𝗽𝗲𝗻𝘀𝗮𝘁𝗶𝗼𝗻 (𝟮𝟲𝗤𝟯): $𝟭𝟵.𝟮 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Share-based pay, a non-cash cost, doubled from a year ago to $19.2 million and made up 23% of operating expenses. It has stayed near that level every quarter this year. Oklo still has $187 million of granted awards to expense over the next three and a half years. 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗲𝘅𝗽𝗲𝗻𝘀𝗲𝘀 (𝟮𝟲𝗤𝟯): $𝟴𝟰.𝟯 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating Running costs more than doubled from a year ago, to $84.3 million. Research and development rose 179% and overhead 95%. Pay for about 240 more employees explains most of it, along with outside engineering consultants. Oklo expenses all research and development as it occurs, the filing says. 𝗣𝗿𝗲𝗽𝗮𝗶𝗱 𝗲𝗻𝗿𝗶𝗰𝗵𝗲𝗱 𝘂𝗿𝗮𝗻𝗶𝘂𝗺 (𝗦𝗲𝗽𝘁 𝟯𝟬, 𝟮𝟬𝟮𝟲): $𝟲𝟴.𝟳 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇗ accelerating A new line on the balance sheet: Oklo has paid $68.7 million in advance for enriched uranium, against nothing at the end of 2025. A further $58.0 million sat in restricted cash at quarter-end as a letter of credit for another uranium purchase. The bank released it on October 13. — • — • — 🔮 𝗚𝘂𝗶𝗱𝗮𝗻𝗰𝗲 𝟮𝟬𝟮𝟲 𝗰𝗮𝘀𝗵 𝘂𝘀𝗲𝗱 𝗶𝗻 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗮𝗰𝘁𝗶𝘃𝗶𝘁𝗶𝗲𝘀: $𝟭𝟮𝟬–𝟭𝟱𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇘ decelerating 🠆 unchanged from $120–150 million Unchanged. Bealmear said Oklo still expects to use $120–150 million of cash in operations this year. That leaves only $9–39 million for the fourth quarter, by our math. The third quarter alone used $45 million, so a repeat would put the year at about $156 million, above the range. Oklo also exceeded last year's range on a reported basis, so the plan assumes a slowdown or a working-capital swing. 𝟮𝟬𝟮𝟲 𝗰𝗮𝘀𝗵 𝘂𝘀𝗲𝗱 𝗳𝗼𝗿 𝗽𝗿𝗼𝗽𝗲𝗿𝘁𝘆, 𝗽𝗹𝗮𝗻𝘁 𝗮𝗻𝗱 𝗲𝗾𝘂𝗶𝗽𝗺𝗲𝗻𝘁: $𝟰𝟬𝟬–𝟱𝟬𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 ⇒ stable 🠆 unchanged from $400–500 million Unchanged. Oklo still plans to spend $400–500 million on plants and equipment this year, mainly Aurora-ID, the Idaho fuel workshop and fuel purchases. By our math, that leaves $119–219 million for the fourth quarter, in line with the $154 million spent in the third. Spending so far this year is already more than eight times last year's total. 𝗙𝗶𝗿𝘀𝘁 𝗔𝘂𝗿𝗼𝗿𝗮 𝗽𝗼𝘄𝗲𝗿𝗵𝗼𝘂𝘀𝗲 𝘀𝘁𝗮𝗿𝘁 𝗱𝗮𝘁𝗲: 𝟮𝟬𝟮𝟴–𝟮𝟬𝟮𝟵 ⇘ decelerating 🠇 cut from 2028 Pushed back. The quarterly filing now targets "deploying our first powerhouse in 2028-2029", where the previous one said 2028. Two years ago the target was late 2027. DeWitte accepted on the call that this reads as a modest delay and tied it to commissioning lessons from Groves-1. No cost estimate accompanies the new date. — • — • — ❓ 𝗞𝗲𝘆 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗪𝗵𝗮𝘁 𝘄𝗶𝗹𝗹 𝗔𝘂𝗿𝗼𝗿𝗮-𝗜𝗗 𝗰𝗼𝘀𝘁 𝗶𝗻 𝘁𝗼𝘁𝗮𝗹? Oklo has now published a cost for Groves-1 but not for the 75-megawatt plant that carries its revenue plan. Bealmear said last quarter a figure would come once it firmed up in 2026, which leaves the fourth-quarter report. 𝗪𝗵𝗮𝘁 𝗱𝗶𝗱 𝗢𝗸𝗹𝗼 𝗿𝗲𝗰𝗲𝗶𝘃𝗲 𝗳𝗼𝗿 𝘁𝗵𝗲 𝗹𝗮𝗻𝗱 𝗶𝘁 𝘀𝗼𝗹𝗱? The quarter's $11.4 million gain came from selling land with a book value of about $4.6 million, by our math. The cash flow statement lists the sale as non-cash, and the filing names neither the buyer nor the consideration. 𝗪𝗵𝗮𝘁 𝗰𝗼𝗻𝗱𝗶𝘁𝗶𝗼𝗻𝘀 𝗿𝗲𝗺𝗮𝗶𝗻 𝗼𝗻 𝘁𝗵𝗲 𝗖𝗲𝗻𝘁𝗿𝘂𝘀 𝘀𝘂𝗽𝗽𝗹𝘆 𝗮𝗴𝗿𝗲𝗲𝗺𝗲𝗻𝘁? The September 30 agreement is "subject to certain conditions" that the filing does not spell out. The first Meta payment to Centrus has no amount attached. Both decide whether the Ohio campus has fuel on a date. 𝗪𝗵𝗮𝘁 𝗵𝗮𝗽𝗽𝗲𝗻𝘀 𝘁𝗼 𝘁𝗵𝗲 $𝟮𝟱 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝗽𝗿𝗲𝗽𝗮𝘆𝗺𝗲𝗻𝘁 𝗶𝗻 𝗙𝗲𝗯𝗿𝘂𝗮𝗿𝘆? A data-centre customer paid $25 million in 2024 for a right of first refusal on Oklo's power. By our math that right ends around February 2027 with no plant running, and the filing does not say whether the money stays with Oklo. 𝗜𝘀 𝟭𝟱𝟬 𝗺𝗲𝗴𝗮𝘄𝗮𝘁𝘁𝘀 𝗶𝗻 𝗢𝗵𝗶𝗼 𝗯𝘆 𝟮𝟬𝟯𝟬 𝘀𝘁𝗶𝗹𝗹 𝘁𝗵𝗲 𝗽𝗹𝗮𝗻? The annual report targeted a first phase of about 150 megawatts around 2030. Three quarterly filings since then refer only to an initial phase, and the grid study now runs two years. Both the size and the date need restating.

$NHC Q3 2026 earnings: NHC operating profit rises, but property deals add heavy debt National HealthCare Corporation, an operator of nursing homes and senior living centers, grew revenue and profit by buying facilities and raising daily patient rates. Net operating revenue rose 7% from a year ago to $408 million, while profit excluding stock portfolio swings and other one-offs grew 14% to $28 million. Reported profit fell by two-thirds only because the company recorded a paper loss on its stock portfolio. • Net operating revenue: $𝟒𝟎𝟖.𝟎𝐌 (+6.6% from a year ago) • Profit per share, excluding one-offs: $𝟏.𝟕𝟔 (+11.4% from a year ago) • Operating margin: 𝟏𝟎.𝟎% (+2.0 percentage points from a year ago) • Total debt: $𝟓𝟎𝟐.𝟏𝐌 ($0 last quarter) ⚖️ 𝐕𝐞𝐫𝐝𝐢𝐜𝐭: 🟢 Bullish The story got better because NHC bought five nursing homes in June and purchased the real estate of 35 leased properties in July, lifting patient volume and cutting quarterly rent by $10 million. One caution: the company borrowed $502 million to buy those buildings, and by our math extra interest and depreciation ate up $9 million of the $10 million rent saving. The question now is how much of the 7% patient revenue growth came from existing facilities rather than the five nursing homes acquired in June. Either underlying demand and daily rates are holding near last year's 8% pace, or existing centers slowed down and the acquisitions masked it. The same-facility revenue breakdown in the quarterly filing will tell. Full article with charts - link in bio 🐂 𝐁𝐮𝐥𝐥 𝐂𝐚𝐬𝐞 🟢🟢 𝐁𝐮𝐲𝐢𝐧𝐠 𝐋𝐞𝐚𝐬𝐞𝐝 𝐏𝐫𝐨𝐩𝐞𝐫𝐭𝐢𝐞𝐬 𝐋𝐢𝐟𝐭𝐞𝐝 𝐎𝐩𝐞𝐫𝐚𝐭𝐢𝐧𝐠 𝐌𝐚𝐫𝐠𝐢𝐧 National HealthCare Corporation operates nursing homes, assisted living communities and homecare agencies. On July 1, the senior care provider bought the real estate of 32 skilled nursing facilities and three independent living facilities from National Health Investors, its landlord. NHC already operated these buildings, because its total count of 80 skilled nursing facilities did not change from previous quarters. Buying the buildings eliminated nearly all of the company's lease payments and lifted operating margin by 2.0 percentage points from a year ago to 10.0%. Facility rent fell by 2.6 percentage points of revenue, dropping from $11.3 million to $1.4 million. That saving more than covered a 0.7-point rise in building depreciation, which reached $14.6 million after property and equipment nearly doubled to $1.29 billion. What to watch: quarterly facility rent and depreciation in the fourth-quarter report. Another quarter near $1.4 million in rent will confirm that the July purchase permanently removed about $40 million in yearly lease bills. 🟢 𝐅𝐢𝐯𝐞 𝐀𝐜𝐪𝐮𝐢𝐫𝐞𝐝 𝐍𝐮𝐫𝐬𝐢𝐧𝐠 𝐇𝐨𝐦𝐞𝐬 𝐃𝐫𝐨𝐯𝐞 𝐏𝐚𝐭𝐢𝐞𝐧𝐭 𝐃𝐚𝐲𝐬 Before buying its leased properties in July, the healthcare operator expanded its operations on June 1 by acquiring five skilled nursing facilities with 639 licensed beds in Tennessee and South Carolina. The third quarter was the first full three-month period with those five centers inside the business, and total skilled nursing patient days rose 7.5% from a year ago to 796,122. • Medicaid patient days: 405,214, up 9.5% from a year ago by our math • Managed Care patient days: 87,548, up 7.6% from a year ago • Private Pay and Other patient days: 217,683, up 5.3% from a year ago • Medicare patient days: 85,677, up 3.8% from a year ago Because NHC did not break out sales from facilities it owned a year ago in this release, we cannot separate underlying patient growth from the five added buildings. Even so, net patient revenue grew 4.7% from the second quarter by our math, showing that a full quarter of the new beds lifted patient volume. What to watch: same-facility revenue growth in the full-year filing. Last year same-facility sales grew 8.4%, and the annual disclosure will show how much of this quarter's 7.1% patient revenue growth came from existing beds. 🟢 𝐇𝐢𝐠𝐡𝐞𝐫 𝐃𝐚𝐢𝐥𝐲 𝐑𝐚𝐭𝐞𝐬 𝐀𝐜𝐫𝐨𝐬𝐬 𝐀𝐥𝐥 𝐇𝐞𝐚𝐥𝐭𝐡 𝐏𝐥𝐚𝐧𝐬 NHC charges a daily rate, called a per diem, for each day a resident stays in one of its skilled nursing centers. Across all residents, the average daily rate rose 4.9% from a year ago to $368.20. Private-pay daily rates climbed 5.5% to $352.96, while government Medicaid rates increased 2.3% to $291.06 and traditional Medicare rates rose 1.7% to $623.72. The biggest jump came from Managed Care, private insurance plans that manage Medicare and Medicaid benefits, where the daily rate rose 20.1% from a year ago to $513.06. Last year's third-quarter rate of $427.11 was unusually low because incentive quality payments from NHC's managed care program arrived late, but this quarter's $513.06 still beat the second quarter's $500.15 by 2.6%. What to watch: Managed Care daily rates in the fourth quarter. Holding the rate above $500 will show that private insurance pricing is rising even without timing swings from quality bonuses. 🐻 𝐁𝐞𝐚𝐫 𝐂𝐚𝐬𝐞 🔴🔴 𝐍𝐞𝐰 𝐃𝐞𝐛𝐭 𝐄𝐚𝐭𝐬 𝐔𝐩 𝐌𝐨𝐬𝐭 𝐑𝐞𝐧𝐭 𝐒𝐚𝐯𝐢𝐧𝐠𝐬 The company said the 13.8% rise in profit excluding one-offs was "primarily driven by the June 1, 2026 acquisition of five skilled nursing facilities and the July 1, 2026 acquisition of the real estate" of 35 properties from National Health Investors. To pay for those buildings, however, the nursing home operator took on $502.1 million of debt after carrying zero debt in the first half of the year. • Facility rent saved: $10.0 million less than a year ago by our math • Extra interest expense: $5.5 million more than a year ago ($7.0 million vs $1.5 million) • Extra depreciation: $3.4 million more than a year ago ($14.6 million vs $11.2 million) • Net pre-tax gain from replacing rent with debt and depreciation: $1.0 million by our math When we subtract the higher interest bill and higher building depreciation from the rent saved, the real estate buyout added only $1.0 million to pre-tax profit by our math. Most of the $3.4 million increase in profit excluding one-offs came from nursing operations and daily rates rather than the real estate deal, while NHC now carries half a billion dollars in debt. What to watch: quarterly interest expense and debt paydowns in the fourth quarter. If quarterly interest stays near $7 million, debt service will keep absorbing most of the cash freed up from rent. 🔴 𝐒𝐭𝐚𝐟𝐟 𝐂𝐨𝐬𝐭𝐬 𝐎𝐮𝐭𝐩𝐚𝐜𝐞𝐝 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 𝐆𝐫𝐨𝐰𝐭𝐡 Running nursing homes requires heavy spending on nurses, therapists and aides, making payroll NHC's largest expense. In the third quarter, salaries, wages and benefits rose 8.0% from a year ago to $251.9 million, outpacing the 6.6% growth in net operating revenue. As a result, staff costs climbed by 0.8 percentage points of revenue by our math, reaching 61.8% compared with 60.9% a year earlier. The senior care group offset that payroll pressure this quarter by keeping other operating expenses — supplies, food and overhead — down by 0.9 percentage points of revenue at 24.4%. Even so, payroll has taken a larger share of revenue for two straight quarters since NHC added the five Tennessee and South Carolina facilities in June. What to watch: salaries, wages and benefits as a share of revenue next quarter. A third straight reading near 62% would show that the newly acquired nursing homes carry permanently higher staffing costs. 👓 𝐎𝐭𝐡𝐞𝐫 𝐓𝐡𝐞𝐦𝐞𝐬 𝐒𝐭𝐨𝐜𝐤 𝐏𝐨𝐫𝐭𝐟𝐨𝐥𝐢𝐨 𝐒𝐰𝐢𝐧𝐠𝐬 𝐂𝐮𝐭 𝐑𝐞𝐩𝐨𝐫𝐭𝐞𝐝 𝐏𝐫𝐨𝐟𝐢𝐭 NHC holds a portfolio of marketable stocks on its balance sheet, and accounting rules require it to record paper gains and losses in reported profit every quarter. A $17.6 million paper loss on those stocks this quarter — against a $20.8 million paper gain a year ago — cut reported net income by 65% to $13.6 million, which is why management focuses on profit excluding those swings. — • — • — 💲 𝐎𝐭𝐡𝐞𝐫 𝐊𝐏𝐈𝐬 𝐂𝐚𝐬𝐡 𝐚𝐧𝐝 𝐦𝐚𝐫𝐤𝐞𝐭𝐚𝐛𝐥𝐞 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐢𝐞𝐬, 𝐢𝐧𝐜𝐥𝐮𝐝𝐢𝐧𝐠 𝐫𝐞𝐬𝐭𝐫𝐢𝐜𝐭𝐞𝐝 (𝟐𝟔𝐐𝟑): $𝟑𝟕𝟒.𝟐 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating Unrestricted and restricted cash and marketable stocks rose by $12.2 million from the second quarter by our math, but remain down 10.0% from $415.6 million at the end of 2025. Combined with $502.1 million in debt taken on in Q3, NHC moved from $375.6 million of net cash at year-end to $127.9 million of net debt. 𝐃𝐢𝐥𝐮𝐭𝐞𝐝 𝐬𝐡𝐚𝐫𝐞 𝐜𝐨𝐮𝐧𝐭 (𝟐𝟔𝐐𝟑): 𝟏𝟓.𝟗𝟔 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇗ accelerating Diluted shares rose 1.9% from a year ago and 0.6% from the second quarter, driven by stock-based compensation that rose to $2.0 million from $1.2 million a year earlier. The higher share count held per-share profit growth excluding one-offs to 11.4%, about 2.4 percentage points below the 13.8% growth in net income excluding one-offs. — • — • — 🔮 𝐆𝐮𝐢𝐝𝐚𝐧𝐜𝐞 𝐐𝐮𝐚𝐫𝐭𝐞𝐫𝐥𝐲 𝐝𝐢𝐯𝐢𝐝𝐞𝐧𝐝 𝐝𝐞𝐜𝐥𝐚𝐫𝐞𝐝 𝐩𝐞𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐡𝐚𝐫𝐞: $𝟎.𝟔𝟕 ⇒ stable 🠆 unchanged from $0.67 Unchanged from the second quarter. NHC does not issue revenue or profit targets, so its declared quarterly dividend of $0.67 per share — up 4.7% from $0.64 a year ago — is the only forward capital commitment in the release. That puts nine-month declared dividends at $1.98 per share, up 4.8% from the first nine months of 2025. — • — • — ❓ 𝐊𝐞𝐲 𝐐𝐮𝐞𝐬𝐭𝐢𝐨𝐧𝐬 𝐇𝐨𝐰 𝐟𝐚𝐬𝐭 𝐝𝐢𝐝 𝐬𝐚𝐦𝐞-𝐟𝐚𝐜𝐢𝐥𝐢𝐭𝐲 𝐫𝐞𝐯𝐞𝐧𝐮𝐞 𝐠𝐫𝐨𝐰 𝐢𝐧 𝐐𝟑? NHC reported 8.7% same-facility revenue growth in last year's third quarter and 8.4% for full-year 2025, but gave no same-facility figure in this release. Without it, investors cannot tell how much of the 7.1% patient revenue growth came from the five facilities acquired in June. 𝐖𝐡𝐚𝐭 𝐚𝐫𝐞 𝐭𝐡𝐞 𝐢𝐧𝐭𝐞𝐫𝐞𝐬𝐭 𝐫𝐚𝐭𝐞 𝐚𝐧𝐝 𝐭𝐞𝐫𝐦𝐬 𝐨𝐧 𝐭𝐡𝐞 𝐝𝐞𝐛𝐭? Current and long-term debt jumped from zero in June to $502.1 million in September to fund the property purchase from National Health Investors. The quarterly filing will need to show whether the interest rate is fixed or floating and how fast NHC must repay the principal. 𝐖𝐡𝐲 𝐝𝐢𝐝 𝐭𝐨𝐭𝐚𝐥 𝐛𝐞𝐝 𝐜𝐨𝐮𝐧𝐭 𝐬𝐭𝐚𝐲 𝐟𝐥𝐚𝐭 𝐚𝐟𝐭𝐞𝐫 𝐉𝐮𝐧𝐞'𝐬 𝐝𝐞𝐚𝐥? NHC acquired five skilled nursing facilities with 639 licensed beds on June 1, yet the release lists 80 operated skilled nursing facilities and 10,323 beds — identical to the first quarter of 2026. Did NHC already manage those five centers for a third party before buying them?

$IMCR Q3 2026 earnings: Immunocore's eye cancer sales slow, and its key trial slips Immunocore, the biotechnology maker of eye cancer drug KIMMTRAK, saw its fifteen-quarter streak of reported sales growth end while its biggest trial readout moved into next year. Reported revenue slipped 1% from a year ago to $102 million as a second-quarter US wholesaler inventory build reversed, though underlying sales grew about 10% after adjusting for US timing quirks. Rising clinical trial spending pushed the company to a $14 million net loss, even as chief executive Bahija Jallal highlighted promising early data combining KIMMTRAK with experimental therapy brenetafusp. • Underlying revenue growth: ~𝟏𝟎% (normalizing for Q2 US stocking and 2025 extra week) • Reported KIMMTRAK sales: $𝟏𝟎𝟐.𝟐𝐌 (-1% from a year ago, -12% from Q2) • Cash and marketable securities: $𝟗𝟎𝟏𝐌 (before ~$120M Q4 rebate payout) • TEBE-AM Phase 3 readout plan: 𝐏𝐮𝐬𝐡𝐞𝐝 𝐭𝐨 𝐐𝟐 𝟐𝟎𝟐𝟕 (prior plan: as early as end of 2026) ⚖️ 𝐕𝐞𝐫𝐝𝐢𝐜𝐭: 🔴 Bearish The story got worse because core eye cancer growth is cooling down at the same time the main catalyst for expansion was pushed back. Completing the 540-patient enrollment for the Phase 3 TEBE-AM skin cancer trial removes recruitment risk, but moving the survival readout from late 2026 to the second quarter of 2027 leaves investors waiting longer while underlying KIMMTRAK growth slows to 10%. On the brighter side, the first type 1 diabetes patient received the company's autoimmune drug, and strong two-drug combination results in eye cancer will launch a new Phase 2/3 trial. The question now is whether KIMMTRAK can grow faster than 10% a year before the skin cancer trial reads out next spring. One view is that launches in new countries and longer European survival labels still leave room to expand; the other is that roughly 70% patient share in the US caps the drug near current levels. Fourth-quarter sales, free of wholesaler inventory swings, will show the true pace. Full article with charts - link in bio 🐂 𝐁𝐮𝐥𝐥 𝐂𝐚𝐬𝐞 🟢 𝐓𝐰𝐨-𝐃𝐫𝐮𝐠 𝐂𝐨𝐦𝐛𝐢𝐧𝐚𝐭𝐢𝐨𝐧 𝐄𝐧𝐭𝐞𝐫𝐬 𝐋𝐚𝐭𝐞-𝐒𝐭𝐚𝐠𝐞 𝐄𝐲𝐞 𝐂𝐚𝐧𝐜𝐞𝐫 𝐓𝐫𝐢𝐚𝐥 Immunocore sells KIMMTRAK, a drug for uveal melanoma, a rare eye cancer that has spread. The biotechnology group is now testing KIMMTRAK alongside brenetafusp, an experimental therapy targeting the PRAME protein found on solid tumors. Chief executive Bahija Jallal said the study delivered "what we believe is the first data demonstrating clinical activity and a manageable safety profile with the combination of two T cell engagers in a solid tumor." • First-line combination response rate: 29% across 17 evaluable patients, with median response lasting 24.1 months • First-line combination survival: 70% alive at two years, and median progression-free survival of 8.1 months • Later-line brenetafusp alone: 19% response rate and 20.3-month median survival across 16 patients Side effects were manageable because no patient suffered severe cytokine release syndrome, an immune overreaction, or stopped treatment due to drug toxicity. That safety record matters because combining two immune-activating drugs could easily overwhelm patients, so the clean results allow the UK and US company to plan a randomized Phase 2/3 trial called DUET-UVEAL. What to watch: the trial design and start date for DUET-UVEAL, plus ovarian and lung cancer data for brenetafusp due at a medical conference later this year. Clear activity in ovarian or lung tumors would show brenetafusp works outside melanoma. 🟢 𝐃𝐢𝐚𝐛𝐞𝐭𝐞𝐬 𝐓𝐫𝐢𝐚𝐥 𝐒𝐭𝐚𝐫𝐭𝐬 𝐀𝐧𝐝 𝐈𝐧𝐭𝐞𝐫𝐧𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐒𝐚𝐥𝐞𝐬 𝐆𝐫𝐨𝐰 The drugmaker is expanding beyond cancer into autoimmune diseases while pushing KIMMTRAK into new countries. This quarter, the first person with type 1 diabetes received IMC-S118AI, a therapy designed to quiet immune attacks on insulin-producing cells without weakening the whole immune system. Management also plans to file for regulatory permission before year-end to test a second autoimmune drug, IMC-U120AI, for skin conditions like eczema. Meanwhile, European regulators added KIMMTRAK's five-year survival data to its prescribing label, which will "allow the Company to engage more broadly with healthcare professionals in the region about the data." Sales in international regions outside the US and Europe rose 75.9% from a year ago to $5.1 million, though they dipped from $6.9 million last quarter. What to watch: the regulatory filing for IMC-U120AI before the end of 2026. Submitting on time would show the autoimmune team can hit deadlines after the diabetes trial started a quarter late. 🐻 𝐁𝐞𝐚𝐫 𝐂𝐚𝐬𝐞 🔴🔴 𝐂𝐫𝐮𝐜𝐢𝐚𝐥 𝐒𝐤𝐢𝐧 𝐂𝐚𝐧𝐜𝐞𝐫 𝐑𝐞𝐚𝐝𝐨𝐮𝐭 𝐒𝐥𝐢𝐩𝐬 𝐈𝐧𝐭𝐨 𝟐𝟎𝟐𝟕 Immunocore relies on a single Phase 3 trial called TEBE-AM to expand KIMMTRAK into previously treated advanced cutaneous melanoma, a skin cancer pool of up to 4,000 patients in the US and Europe. On the positive side, the trial finally "achieved its target enrollment of 540 patients" this quarter after falling a few weeks behind its original first-half 2026 schedule. However, the company pushed the timeline for initial survival results back, stating that "topline overall survival data is expected in the second quarter of 2027." For the last three quarters, management had told investors those results could arrive as early as the end of 2026. Because the study waits for a set number of patient deaths to measure survival, slower events can explain the wait, but this marks the fourth clinical timeline to move backward in recent quarters without management calling it a delay. What to watch: any further change to the second-quarter 2027 readout window in the full-year report. A positive survival result in that window would open a patient group four times larger than the ~1,000 eye cancer patients treated today. 🔴🔴 𝐔𝐒 𝐒𝐚𝐥𝐞𝐬 𝐃𝐫𝐨𝐩 𝐎𝐧 𝐖𝐡𝐨𝐥𝐞𝐬𝐚𝐥𝐞𝐫 𝐈𝐧𝐯𝐞𝐧𝐭𝐨𝐫𝐲 𝐑𝐞𝐯𝐞𝐫𝐬𝐚𝐥 "Nearly five years after launch, KIMMTRAK remains the proven standard of care in HLA-A*02:01+ metastatic uveal melanoma," chief executive Bahija Jallal said. Yet after fifteen straight quarters of top-line expansion, reported net product sales fell 1.4% from a year ago to $102.2 million, and dropped 11.8% from last quarter's $115.9 million. The company blamed the drop on "United States wholesaler stocking that occurred in Q2 of 2026" — a $6 million inventory build that reversed this quarter — and "one additional week of sales in the U. S. in Q3 2025." Even after adjusting for both items, underlying revenue grew about 10% from a year ago, down from 18% reported growth in the second quarter and 29% across 2025. US sales fell 7.6% from a year ago to $62.2 million because the drug has already reached roughly 70% of eligible US patients. What to watch: fourth-quarter revenue against last year's $104.5 million, once the wholesaler inventory drag is gone. Growth staying near 10% or lower would confirm the eye cancer market is nearing its ceiling. 🔴 𝐑𝐞𝐛𝐚𝐭𝐞 𝐁𝐢𝐥𝐥 𝐖𝐢𝐥𝐥 𝐃𝐫𝐚𝐢𝐧 𝐅𝐨𝐮𝐫𝐭𝐡-𝐐𝐮𝐚𝐫𝐭𝐞𝐫 𝐂𝐚𝐬𝐡 In European countries, Immunocore sells KIMMTRAK at list prices and accrues rebates it must pay back to health authorities later. By our math, operating cash flow rebounded to $20.1 million in the third quarter from just $2.2 million across the entire first half of 2026, helped by accounts receivable falling 7.7% from June to $88.0 million. That third-quarter cash inflow means the big European rebate bill has not been paid yet. Management previously planned to pay "approximately $120 million in sales-related rebate accruals" during the second half of 2026, and confirmed today the entire sum leaves in the fourth quarter. Because nine-month operating cash flow is only $22.2 million, paying $120 million in rebates will push full-year operating cash flow deep into negative territory. What to watch: fourth-quarter operating cash flow and the year-end accrued liabilities balance in the annual report. A cash outflow much larger than the rebate bill would show core commercial collections are weakening too. 🔴 𝐑𝐢𝐬𝐤𝐬 𝐭𝐡𝐢𝐬 𝐪𝐮𝐚𝐫𝐭𝐞𝐫 𝐝𝐢𝐝𝐧'𝐭 𝐚𝐧𝐬𝐰𝐞𝐫 Five standing concerns and watch items received no new evidence in the third-quarter earnings release. • US market penetration rate: missing from the release after sitting near 70% last quarter; the earnings call or quarterly filing must show whether US patient share has stalled. • Single-product reliance: KIMMTRAK still provides 100% of revenue, leaving the business exposed until TEBE-AM reports in the second quarter of 2027. • PRAME tumor direction: ovarian and lung cancer data for brenetafusp did not appear in this release and remain due at a conference later in 2026. • Rival melanoma drugs: competing oral regimens in eye cancer and cell therapies in skin cancer remain clinical threats that only trial readouts will test. • Convertible debt load: $394.8 million of borrowings sit on the balance sheet while the business posted a $13.6 million quarterly operating loss. — • — • — 💲 𝐎𝐭𝐡𝐞𝐫 𝐊𝐏𝐈𝐬 𝐎𝐩𝐞𝐫𝐚𝐭𝐢𝐧𝐠 𝐥𝐨𝐬𝐬 𝐚𝐧𝐝 𝐞𝐱𝐩𝐞𝐧𝐬𝐞 𝐫𝐚𝐭𝐢𝐨𝐬 (𝟐𝟔𝐐𝟑): $𝟏𝟑.𝟔 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 𝐥𝐨𝐬𝐬 ⇄ reversing Immunocore swung back to a wider operating loss after nearly breaking even last quarter. Operating margin fell 6.4 percentage points from a year ago to minus 13.3% by our math, because research and development costs for its three Phase 3 trials rose 5.0 percentage points to 73.1% of revenue and overhead rose 1.2 points to 39.6%. 𝐂𝐚𝐬𝐡 𝐚𝐧𝐝 𝐦𝐚𝐫𝐤𝐞𝐭𝐚𝐛𝐥𝐞 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐢𝐞𝐬 (𝟐𝟔𝐐𝟑): $𝟗𝟎𝟏.𝟑 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇗ accelerating Total cash and marketable securities rose by $21.1 million from June and $37.1 million since the end of 2025, by our math. After subtracting $394.8 million in loans and borrowings, net cash stands at $506.5 million, giving the drugmaker plenty of cushion to absorb the $120 million fourth-quarter rebate payment. 𝐖𝐞𝐢𝐠𝐡𝐭𝐞𝐝-𝐚𝐯𝐞𝐫𝐚𝐠𝐞 𝐬𝐡𝐚𝐫𝐞 𝐜𝐨𝐮𝐧𝐭 (𝟐𝟔𝐐𝟑): 𝟓𝟏.𝟔 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇒ stable Basic and diluted shares rose 2.3% from a year ago and 1.1% from the second quarter, by our math. Because the biotech posted a net loss of $14.2 million, stock options and convertible notes were excluded from the diluted count, and dilution came solely from employee share issuances. — • — • — 🔮 𝐆𝐮𝐢𝐝𝐚𝐧𝐜𝐞 𝐒𝐚𝐥𝐞𝐬-𝐫𝐞𝐥𝐚𝐭𝐞𝐝 𝐫𝐞𝐛𝐚𝐭𝐞 𝐚𝐜𝐜𝐫𝐮𝐚𝐥 𝐩𝐚𝐲𝐦𝐞𝐧𝐭𝐬 (𝟐𝟔𝐐𝟒): ~$𝟏𝟐𝟎 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇗ accelerating 🠆 unchanged from ~$120 million in H2 2026 Unchanged. Immunocore still expects to pay roughly $120 million in accrued sales rebates, and narrowed the timing from the second half of 2026 specifically to the fourth quarter. Because nine-month operating cash flow was only $22.2 million, this single payout will turn fourth-quarter and full-year operating cash flow negative, nearly double the $65 million paid in late 2025. 𝐏𝐡𝐚𝐬𝐞 𝟑 𝐓𝐄𝐁𝐄-𝐀𝐌 𝐭𝐨𝐩𝐥𝐢𝐧𝐞 𝐨𝐯𝐞𝐫𝐚𝐥𝐥 𝐬𝐮𝐫𝐯𝐢𝐯𝐚𝐥 𝐝𝐚𝐭𝐚: 𝐐𝟐 𝟐𝟎𝟐𝟕 ⇘ decelerating 🠇 cut from As early as the end of 2026 Pushed back. With all 540 skin cancer patients now enrolled, the group expects topline survival results in the second quarter of 2027 rather than as early as late 2026. The trial is driven by survival events, and this represents the fourth clinical milestone in recent quarters to move to a later window. 𝐁𝐫𝐞𝐧𝐞𝐭𝐚𝐟𝐮𝐬𝐩 𝐏𝐡𝐚𝐬𝐞 𝟏/𝟐 𝐨𝐯𝐚𝐫𝐢𝐚𝐧 𝐚𝐧𝐝 𝐥𝐮𝐧𝐠 𝐜𝐚𝐧𝐜𝐞𝐫 𝐝𝐚𝐭𝐚: 𝐋𝐚𝐭𝐞𝐫 𝐢𝐧 𝟐𝟎𝟐𝟔 ⇒ stable 🠆 unchanged from Second half of 2026 Unchanged. Management still plans to present clinical results from the ovarian and non-small cell lung cancer cohorts at a medical conference before the end of the year. Notably, the release did not repeat the prior target to share initial dose-escalation data for the longer-acting IMC-P115C molecule in the second half of 2026. 𝐈𝐌𝐂-𝐔𝟏𝟐𝟎𝐀𝐈 𝐚𝐮𝐭𝐨𝐢𝐦𝐦𝐮𝐧𝐞 𝐫𝐞𝐠𝐮𝐥𝐚𝐭𝐨𝐫𝐲 𝐟𝐢𝐥𝐢𝐧𝐠 (𝐂𝐓𝐀 𝐨𝐫 𝐈𝐍𝐃): 𝐁𝐞𝐟𝐨𝐫𝐞 𝐭𝐡𝐞 𝐞𝐧𝐝 𝐨𝐟 𝟐𝟎𝟐𝟔 ⇒ stable 🠆 unchanged from Second half of 2026 Unchanged. The UK and US company remains on track to submit a clinical trial application for its second autoimmune candidate, targeting skin diseases such as atopic dermatitis, before year-end. Its HIV multiple-ascending-dose readout also remains scheduled for early 2027. — • — • — ❓ 𝐊𝐞𝐲 𝐐𝐮𝐞𝐬𝐭𝐢𝐨𝐧𝐬 𝐖𝐡𝐞𝐫𝐞 𝐝𝐢𝐝 𝐔𝐒 𝐊𝐈𝐌𝐌𝐓𝐑𝐀𝐊 𝐩𝐚𝐭𝐢𝐞𝐧𝐭 𝐩𝐞𝐧𝐞𝐭𝐫𝐚𝐭𝐢𝐨𝐧 𝐥𝐚𝐧𝐝 𝐢𝐧 𝐐𝟑? The earnings release omitted the US penetration rate after management cited roughly 70% last quarter. Because penetration is the main forward indicator for KIMMTRAK demand, investors need to know if US patient share is still inching up or has hit a ceiling. 𝐃𝐢𝐝 𝐬𝐥𝐨𝐰𝐞𝐫 𝐝𝐞𝐚𝐭𝐡𝐬 𝐨𝐫 𝐥𝐚𝐭𝐞 𝐞𝐧𝐫𝐨𝐥𝐥𝐦𝐞𝐧𝐭 𝐩𝐮𝐬𝐡 𝐓𝐄𝐁𝐄-𝐀𝐌 𝐭𝐨 𝟐𝟎𝟐𝟕? Topline survival data moved from as early as late 2026 to the second quarter of 2027 just as enrollment finished. Knowing whether the shift came from the few weeks of enrollment delay or patients living longer in the trial helps judge the odds of success. 𝐖𝐡𝐞𝐧 𝐰𝐢𝐥𝐥 𝐢𝐧𝐢𝐭𝐢𝐚𝐥 𝐝𝐚𝐭𝐚 𝐟𝐨𝐫 𝐈𝐌𝐂-𝐏𝟏𝟏𝟓𝐂 𝐛𝐞 𝐬𝐡𝐚𝐫𝐞𝐝? Prior filings promised initial Phase 1 data for the longer-acting PRAME drug IMC-P115C in the second half of 2026, but this release only mentioned continuing enrollment. Clarifying that timeline matters for deciding which PRAME molecule leads the franchise. 𝐇𝐨𝐰 𝐦𝐮𝐜𝐡 𝐰𝐢𝐥𝐥 𝐭𝐡𝐞 𝐃𝐔𝐄𝐓-𝐔𝐕𝐄𝐀𝐋 𝐭𝐫𝐢𝐚𝐥 𝐚𝐝𝐝 𝐭𝐨 𝐑&𝐃? Research and development costs already reached 73.1% of revenue this quarter with three Phase 3 trials running. Starting a fourth late-stage trial for the KIMMTRAK and brenetafusp combination will raise quarterly cash burn unless older studies wind down.

$GOGO Q3 2026 earnings: Gogo extends its loan to 2030, but profit drops 27% Gogo pushed out its biggest debt deadline, while its older air-to-ground business kept shrinking faster than its new satellite service grew. Total revenue for the in-flight internet provider fell 5% from a year ago, and profit before interest, taxes, depreciation and one-offs dropped 27% as third-party satellite bandwidth costs rose. Finance chief Zac Cotner extended the maturity on the company's ~$600 million term loan to October 2030, and Gogo held its full-year targets steady, which by our math leaves profit stepping down again in the fourth quarter. • Total revenue: $𝟐𝟏𝟑.𝟐𝐌 (-4.6% from a year ago) • Adjusted EBITDA: $𝟒𝟏.𝟎𝐌 (-27% from a year ago) • Air-to-ground vs Galileo jets online: -𝟑𝟑𝟐 / +𝟏𝟏𝟑 (change from last quarter) • Full-year outlook: 𝐔𝐧𝐜𝐡𝐚𝐧𝐠𝐞𝐝 (middle of the range: 3.1% revenue drop) ⚖️ 𝐕𝐞𝐫𝐝𝐢𝐜𝐭: 🟢 Bullish The story got better because extending the ~$600 million loan to 2030 removes the April 2028 refinancing crunch that hung over the business, while record Galileo satellite activations and new jet-maker orders show customer adoption is picking up. The bad news: air-to-ground losses are still outrunning satellite additions three to one, and military service revenue slipped from the second quarter's peak. Beating the second-half profit pace implied by the prior outlook while cutting expected legal costs without raising the full-year target shows the underlying margin pressure has not eased. The question now is whether rising Galileo satellite activations and military contracts can outgrow air-to-ground cancellations before lower-margin satellite costs push profit down further. If satellite activations keep climbing and military revenue holds near current levels, total service revenue stabilizes in 2027; if air-to-ground losses stay above 300 jets a quarter, revenue and margins keep falling. Fourth-quarter aircraft online counts and the 2027 outlook next quarter will tell. Full article with charts - link in bio 🐂 𝐁𝐮𝐥𝐥 𝐂𝐚𝐬𝐞 🟢🟢 𝐓𝐞𝐫𝐦 𝐋𝐨𝐚𝐧 𝐄𝐱𝐭𝐞𝐧𝐬𝐢𝐨𝐧 𝐏𝐮𝐬𝐡𝐞𝐬 𝐎𝐮𝐭 𝐭𝐡𝐞 𝟐𝟎𝟐𝟖 𝐃𝐞𝐛𝐭 𝐖𝐚𝐥𝐥 Gogo carries $817.1 million in total debt, and the April 2028 maturity on its two term loans has been a primary balance-sheet risk. Today, the in-flight internet provider amended and extended its original ~$600 million Term Loan B facility to October 2030. The company wrote that the deal "provides 2.5 years of additional runway to further the Company’s transformation plan". In exchange, finance chief Zac Cotner committed Gogo to $75 million in principal paydowns through 2027, starting with $25 million immediately and $30 million more by December 2026. Including scheduled payments, total debt will fall by $92 million by the end of 2027. Separately, the Federal Communications Commission (FCC) renewed Gogo's exclusive nationwide air-to-ground radio spectrum licenses through 2036, securing its domestic network rights. What to watch: the interest rate on the extended loan and the status of the smaller second term loan in the quarterly filing. Those terms will show how much extra annual interest Gogo is paying for the extra time and how much debt still matures in 2028. 🟢 𝐆𝐚𝐥𝐢𝐥𝐞𝐨 𝐒𝐚𝐭𝐞𝐥𝐥𝐢𝐭𝐞 𝐀𝐜𝐭𝐢𝐯𝐚𝐭𝐢𝐨𝐧𝐬 𝐚𝐧𝐝 𝐎𝐫𝐝𝐞𝐫𝐬 𝐏𝐢𝐜𝐤𝐞𝐝 𝐔𝐩 Gogo Galileo is the company's new low-Earth-orbit (LEO) satellite internet service for business jets, built to compete with Starlink and replace older equipment. After installation delays earlier in the year, customer activations sped up in the third quarter, and jet makers placed their first large orders. • Galileo aircraft online: 297 jets, up 113 from last quarter after adding 73 in the second quarter • Galileo equipment shipped: a record 172 units, up 59% from last quarter • New fleet orders: 71 aircraft for PlaneSense, 40 systems for Duncan Aviation, 25 units for Bombardier, and 22 jets for TransMedics Textron Aviation also named Galileo standard equipment on three Cessna Citation jet models. Still, to reach Cotner's previous high-end target of the mid-500s by year-end, Gogo would need to activate roughly 250 more jets in the fourth quarter, more than double this quarter's record pace. What to watch: fourth-quarter Galileo aircraft online against the 297 level today. A jump above 420 would show that the 372 units shipped over the past nine months are clearing maintenance shops faster. 🐻 𝐁𝐞𝐚𝐫 𝐂𝐚𝐬𝐞 🔴🔴 𝐋𝐞𝐠𝐚𝐜𝐲 𝐀𝐢𝐫-𝐭𝐨-𝐆𝐫𝐨𝐮𝐧𝐝 𝐋𝐨𝐬𝐬𝐞𝐬 𝐒𝐭𝐢𝐥𝐥 𝐎𝐮𝐭𝐫𝐮𝐧 𝐒𝐚𝐭𝐞𝐥𝐥𝐢𝐭𝐞 𝐆𝐚𝐢𝐧𝐬 Chief executive Chris Moore said "we believe that the current positive trends in our LEO and GEO offerings should drive growth in our core markets". GEO refers to geostationary satellites positioned high above the equator, while ATG is Gogo's older air-to-ground cellular network in North America. Right now, the math in business aviation still runs the other way because older ATG customers are leaving much faster than satellite customers arrive. • Total ATG aircraft online: 5,399 jets, down 332 from last quarter and down 17.3% from a year ago • Monthly service revenue per ATG aircraft (ARPU): $3,268, down 4.1% from a year ago • Business aviation service revenue: $145.6 million, down 10.5% from a year ago • GEO satellite aircraft online: 1,285 jets, down 21 from last quarter and down 4.3% from a year ago In dollar terms, ATG broadband service revenue fell $15.6 million from a year ago to $55.5 million, while satellite broadband service revenue grew by only $5.4 million to $83.9 million. Adding 113 Galileo jets and 56 Gogo 5G jets this quarter covered only half of the 332 ATG aircraft lost. What to watch: fourth-quarter ATG aircraft online. Management's full-year plan assumed a net drop of about 1,200 ATG aircraft, which leaves room for only 197 more losses in the fourth quarter after losing 1,003 in the first nine months. 🔴🔴 𝐒𝐚𝐭𝐞𝐥𝐥𝐢𝐭𝐞 𝐂𝐨𝐬𝐭𝐬 𝐚𝐧𝐝 𝐋𝐨𝐰𝐞𝐫 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 𝐒𝐪𝐮𝐞𝐞𝐳𝐞𝐝 𝐏𝐫𝐨𝐟𝐢𝐭 𝐌𝐚𝐫𝐠𝐢𝐧𝐬 Replacing air-to-ground connections with satellite service hurts Gogo's margins, because Gogo owns its ground towers but pays third-party satellite operators for bandwidth. As high-margin ATG revenue shrank, the cost of providing service rose 6.2% from a year ago to $97.3 million, climbing 4.7 percentage points of total revenue to 45.6%. Equipment sales also lost money before overhead, with $31.0 million in equipment cost against $30.5 million in equipment revenue. Adjusted EBITDA — earnings before interest, taxes, depreciation, amortization, stock compensation and one-offs — fell 27.0% from a year ago to $41.0 million, or 19.2% of revenue, down 5.9 percentage points. That $41.0 million beat the $34–39 million quarterly pace implied by the second-half outlook by our math, partly because full-year legal costs are running $4 million lower than planned. Yet Gogo left its full-year Adjusted EBITDA target unchanged, which by our math points to $27–37 million in the fourth quarter. What to watch: service gross margin in the fourth quarter. If satellite bandwidth fees keep pushing service costs above 53% of service revenue, profit will keep shrinking even after legal expenses ease. 🔴 𝐌𝐢𝐥𝐢𝐭𝐚𝐫𝐲 𝐚𝐧𝐝 𝐆𝐨𝐯𝐞𝐫𝐧𝐦𝐞𝐧𝐭 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 𝐏𝐮𝐥𝐥𝐞𝐝 𝐁𝐚𝐜𝐤 𝐅𝐫𝐨𝐦 𝐐𝟐 Gogo's military and government division has been its fastest-growing business since the Satcom Direct acquisition, and it remains a standing growth pillar while carrying the risk that conflict-driven demand cools off. In the third quarter, military and government service revenue rose 36.0% from a year ago to $37.2 million, up from $27.3 million in last year's third quarter. Compared with the second quarter, however, revenue fell 6.9% from $39.9 million. Last quarter, management warned that Middle East conflict activity had boosted usage above normal levels, and this quarter's sequential drop confirms that peak usage did not hold. Gogo did win a geostationary satellite lease renewal worth over $15 million with an overseas government and completed drone testing with Boeing's Insitu unit. What to watch: whether fourth-quarter military and government service revenue holds near $37 million. Holding that level would show that multi-year contracts are replacing temporary conflict usage. 🔴 𝐑𝐢𝐬𝐤𝐬 𝐭𝐡𝐢𝐬 𝐪𝐮𝐚𝐫𝐭𝐞𝐫 𝐝𝐢𝐝𝐧'𝐭 𝐚𝐧𝐬𝐰𝐞𝐫 Four standing concerns regarding legal liabilities, fourth-quarter cash collection, and unit economics remain open after the third-quarter release. • SmartSky patent and antitrust lawsuits: Gogo trimmed its 2026 ongoing legal expense estimate from $22 million to $18 million after spending $4.1 million in Q3, but gave no update on the $22.7 million infringement verdict or the May 2027 antitrust trial; the 10-Q legal footnote will carry any courtroom developments. • Fourth-quarter cash collection: hitting the middle of the $65–85 million free cash flow outlook requires $44.5 million in Q4 by our math, which depends on collecting $13.6 million in remaining FCC reimbursements and selling down $119.9 million of inventory. • Galileo revenue per aircraft: Gogo still does not disclose monthly service revenue per Galileo jet, leaving no direct read on whether satellite upgrades match the $3,268 monthly revenue of departing ATG aircraft. • True ATG customer cancellations: the release does not split the 332 ATG aircraft drop between customers leaving Gogo for rivals like Starlink and customers temporarily offline while upgrading to Galileo. 👓 𝐎𝐭𝐡𝐞𝐫 𝐓𝐡𝐞𝐦𝐞𝐬 𝐅𝐂𝐂 𝐆𝐫𝐚𝐧𝐭𝐞𝐝 𝐒𝐢𝐱-𝐌𝐨𝐧𝐭𝐡 𝐄𝐱𝐭𝐞𝐧𝐬𝐢𝐨𝐧 𝐟𝐨𝐫 𝐍𝐞𝐭𝐰𝐨𝐫𝐤 𝐑𝐞𝐩𝐥𝐚𝐜𝐞𝐦𝐞𝐧𝐭 The FCC granted Gogo a six-month extension, from November 8, 2026 to May 8, 2027, to finish removing Chinese-made equipment under the federal "Rip & Replace" program. Because of the shift, Gogo plans to "flash cut customers to the new software system by the end of Q1 2027" and lowered both its 2026 capital spending plan and its expected 2026 FCC cash reimbursement by $10 million. — • — • — 💲 𝐎𝐭𝐡𝐞𝐫 𝐊𝐏𝐈𝐬 𝐅𝐫𝐞𝐞 𝐜𝐚𝐬𝐡 𝐟𝐥𝐨𝐰 𝐚𝐧𝐝 𝐧𝐞𝐭 𝐝𝐞𝐛𝐭 (𝟐𝟔𝐐𝟑): $𝟐𝟖.𝟏 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇗ accelerating Free cash flow — operating cash flow plus FCC reimbursements and interest-rate cap payouts, minus capital spending — rose 30.2% from last quarter to $28.1 million, though it fell 7.9% from a year ago. Capital spending dropped to $5.3 million while FCC proceeds reached $6.0 million. That cash lifted cash on hand to $90.7 million and trimmed net debt to $726.4 million by our math. 𝐈𝐧𝐯𝐞𝐧𝐭𝐨𝐫𝐢𝐞𝐬 (𝟐𝟔𝐐𝟑): $𝟏𝟏𝟗.𝟗 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating Equipment inventory fell by $5.2 million from the second quarter's $125.1 million peak as Galileo satellite shipments hit a record 172 units. However, inventory remains 21.3% higher than the $98.9 million carried at the end of 2025, having tied up $21.0 million of operating cash over the first nine months of 2026. 𝐃𝐢𝐥𝐮𝐭𝐞𝐝 𝐬𝐡𝐚𝐫𝐞 𝐜𝐨𝐮𝐧𝐭 (𝟐𝟔𝐐𝟑): 𝟏𝟑𝟔.𝟔 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇒ stable The weighted average diluted share count rose 1.5% from a year ago and was nearly unchanged from 136.3 million in the second quarter. Share buybacks remained paused for aseventh straight quarter as management directed cash toward the $39.96 million Satcom Direct earnout payment and $23.0 million of term loan paydowns over the first nine months. — • — • — 🔮 𝐆𝐮𝐢𝐝𝐚𝐧𝐜𝐞 𝐅𝐘𝟐𝟔 𝐓𝐨𝐭𝐚𝐥 𝐫𝐞𝐯𝐞𝐧𝐮𝐞: $𝟖𝟕𝟎–𝟖𝟗𝟓 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇒ stable 🠆 unchanged from $870–895 million Unchanged. The plan keeps revenue down 3.1% from 2025 at the middle of the range, with 84% from services and 16% from equipment. By our math, that leaves $220.1 million at the middle of the range for the fourth quarter, a 4.5% drop from a year ago and up 3.2% from the third quarter. Gogo cut this range by $42.5 million at the midpoint last quarter. 𝐅𝐘𝟐𝟔 𝐀𝐝𝐣𝐮𝐬𝐭𝐞𝐝 𝐄𝐁𝐈𝐓𝐃𝐀: $𝟏𝟕𝟓–𝟏𝟖𝟓 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating 🠆 unchanged from $175–185 million Unchanged. The full-year target still points to a 17.3% drop from 2025 at the middle of the range, even though Gogo lowered its expected 2026 ongoing legal expense from $22 million to $18 million. By our math, after earning $148.0 million in the first nine months, the outlook leaves $27.0–37.0 million for the fourth quarter, down from $41.0 million this quarter. 𝐅𝐘𝟐𝟔 𝐅𝐫𝐞𝐞 𝐜𝐚𝐬𝐡 𝐟𝐥𝐨𝐰: $𝟔𝟓–𝟖𝟓 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇗ accelerating 🠆 unchanged from $65–85 million Unchanged. At the $75 million middle of the range, full-year free cash flow would fall 15.9% from $89.2 million in 2025. Because the broadband provider generated only $30.5 million in the first nine months, by our math it must generate $34.5–54.5 million in the fourth quarter alone. That fourth-quarter jump relies on collecting $13.6 million in remaining FCC reimbursements. 𝐅𝐘𝟐𝟔 𝐍𝐞𝐭 𝐜𝐚𝐩𝐢𝐭𝐚𝐥 𝐞𝐱𝐩𝐞𝐧𝐝𝐢𝐭𝐮𝐫𝐞𝐬: $𝟐𝟎 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇒ stable 🠆 unchanged from $20 million Unchanged. Net capital spending stays at $20 million, but the two numbers inside it both dropped by $10 million. Following the six-month FCC deadline extension to May 2027, the company now plans $55 million in gross capital spending and $35 million in FCC reimbursements this year, down from $65 million and $45 million previously. By our math, that leaves $9.5 million of gross capital spending for Q4. — • — • — ❓ 𝐊𝐞𝐲 𝐐𝐮𝐞𝐬𝐭𝐢𝐨𝐧𝐬 𝐖𝐡𝐚𝐭 𝐢𝐧𝐭𝐞𝐫𝐞𝐬𝐭 𝐫𝐚𝐭𝐞 𝐝𝐢𝐝 𝐆𝐨𝐠𝐨 𝐩𝐚𝐲 𝐨𝐧 𝐭𝐡𝐞 𝐞𝐱𝐭𝐞𝐧𝐝𝐞𝐝 𝐥𝐨𝐚𝐧? Gogo pushed the maturity of its ~$600 million Term Loan B out to October 2030 and agreed to pay down $75 million of principal through 2027, but the release did not disclose the new interest rate spread or what happens to the remaining ~$217 million of debt. 𝐖𝐡𝐲 𝐝𝐨𝐞𝐬 𝐭𝐡𝐞 𝐨𝐮𝐭𝐥𝐨𝐨𝐤 𝐢𝐦𝐩𝐥𝐲 𝐥𝐨𝐰𝐞𝐫 𝐐𝟒 𝐩𝐫𝐨𝐟𝐢𝐭 𝐚𝐟𝐭𝐞𝐫 𝐜𝐮𝐭𝐭𝐢𝐧𝐠 𝐥𝐞𝐠𝐚𝐥 𝐜𝐨𝐬𝐭𝐬? Management lowered its 2026 ongoing litigation expense forecast by $4 million to $18 million and beat the third-quarter implied profit pace, yet kept the full-year Adjusted EBITDA outlook unchanged, which implies a step-down to $27–37 million in Q4. 𝐇𝐨𝐰 𝐦𝐚𝐧𝐲 𝐝𝐞𝐩𝐚𝐫𝐭𝐢𝐧𝐠 𝐚𝐢𝐫-𝐭𝐨-𝐠𝐫𝐨𝐮𝐧𝐝 𝐣𝐞𝐭𝐬 𝐮𝐩𝐠𝐫𝐚𝐝𝐞𝐝 𝐭𝐨 𝐆𝐚𝐥𝐢𝐥𝐞𝐨 𝐯𝐞𝐫𝐬𝐮𝐬 𝐜𝐚𝐧𝐜𝐞𝐥𝐥𝐞𝐝? Total air-to-ground aircraft online fell by 332 this quarter while Galileo added 113 and Gogo 5G added 56. Without knowing how many departing jets moved to Gogo's own satellite service, investors cannot measure true customer losses to Starlink. 𝐖𝐢𝐥𝐥 𝐭𝐡𝐞 𝐧𝐞𝐭𝐰𝐨𝐫𝐤 𝐝𝐞𝐚𝐝𝐥𝐢𝐧𝐞 𝐞𝐱𝐭𝐞𝐧𝐬𝐢𝐨𝐧 𝐝𝐞𝐥𝐚𝐲 𝐚𝐢𝐫-𝐭𝐨-𝐠𝐫𝐨𝐮𝐧𝐝 𝐞𝐪𝐮𝐢𝐩𝐦𝐞𝐧𝐭 𝐮𝐩𝐠𝐫𝐚𝐝𝐞𝐬? The FCC extended the Rip & Replace deadline to May 2027 and Gogo pushed its software cutover to the end of Q1 2027. Air-to-ground equipment sales already dropped 52% from last quarter to 142 units, raising the question of whether customers are waiting.

$PAA Q3 2026 earnings: Plains grows its crude business, while debt refinancing boosts cash Plains All American, the North American crude oil pipeline operator, grew its core oil business while reshaping its balance sheet after selling its Canadian gas liquids unit. Cash profit from continuing operations jumped 21% to $711 million on higher Permian volume and the Cactus III pipeline purchase, while a one-time accounting charge from buying back preferred units pushed reported net income into a per-unit loss. Chief Executive Willie Chiang kept the full-year cash profit target at $2.88 billion, which by our math leaves $701 million for the fourth quarter. • Cash profit from continuing crude operations: $𝟕𝟏𝟏𝐌 (+20.7% from a year ago) • Cash available for distribution per unit: $𝟎.𝟔𝟕 (+10% from a year ago) • Reported loss per unit (after preferred buyout): -$𝟎.𝟎𝟔 ($0.46 profit before the buyout charge, by our math) • Full-year cash profit outlook: 𝐔𝐧𝐜𝐡𝐚𝐧𝐠𝐞𝐝 (middle of the range: $2.88B (+16% in crude)) ⚖️ 𝐕𝐞𝐫𝐝𝐢𝐜𝐭: 🟢 Bullish The story got better because Plains locked in permanent cash savings and new oil supply to replace the Canadian business it sold. Refinancing $2.3 billion of preferred units with cheaper debt adds about $60 million a year in cash for common unitholders, and two gathering deals in the Powder River and Midland basins add future pipeline volume. One caution: lower contract rates on older Permian pipelines, a $68 million write-down on co-owned pipelines, and rising field cleanup costs held back margins. The question now is whether volume growth from new gathering pipes can outrun lower contract rates and rising field costs once the Cactus III acquisition laps in November. If new barrels and internal cost cuts win out, cash profit keeps climbing in 2027; if rate resets and cleanup bills persist, profit growth stalls until the Midland expansion starts in late 2027. Management's first 2027 outlook next quarter will settle it. Full article with charts - link in bio 🐂 𝐁𝐮𝐥𝐥 𝐂𝐚𝐬𝐞 🟢🟢 𝐂𝐨𝐧𝐭𝐢𝐧𝐮𝐢𝐧𝐠 𝐂𝐫𝐮𝐝𝐞 𝐎𝐩𝐞𝐫𝐚𝐭𝐢𝐨𝐧𝐬 𝐆𝐫𝐞𝐰 𝟐𝟏% 𝐀𝐟𝐭𝐞𝐫 𝐍𝐆𝐋 𝐄𝐱𝐢𝐭 Plains All American, the North American crude oil pipeline and storage operator, sold its Canadian natural gas liquids (NGL) business in May 2026. Because last year's third quarter still included $80 million from those sold assets, total earnings before interest, taxes, depreciation and amortization (EBITDA), excluding one-offs, grew only 6.3% to $711 million. On a like-for-like basis, EBITDA excluding one-offs from the continuing crude oil business rose 20.7% from $589 million a year ago. Buying the Cactus III pipeline late last year and capturing $50 million in cost savings from the deal drove the increase. Daily crude volume in the Permian Basin, the company's main oil field in Texas and New Mexico, also rose 7.8% to 8.07 million barrels. What to watch: fourth-quarter continuing EBITDA excluding one-offs, which marks the first full quarter after the November 2025 Cactus III purchase. A growth rate near the 13.8% pace implied by the full-year outlook would show that pipeline volume gains can carry the business without deal boosts. 🟢 𝐑𝐞𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐧𝐠 𝐏𝐫𝐞𝐟𝐞𝐫𝐫𝐞𝐝 𝐔𝐧𝐢𝐭𝐬 𝐀𝐝𝐝𝐬 $𝟔𝟎 𝐌𝐢𝐥𝐥𝐢𝐨𝐧 𝐢𝐧 𝐘𝐞𝐚𝐫𝐥𝐲 𝐂𝐚𝐬𝐡 Plains used its balance sheet to cut financing payouts and leave more cash for common unitholders. The partnership issued $1.5 billion of junior subordinated notes and redeemed $2.3 billion of higher-cost Series A and Series B preferred units across September and October. • Expected annual cash benefit: about $60 million, or $0.09 per common unit • Accounting charge from the Series A buyout: $358 million, or $0.51 per unit by our math • Profit per unit excluding one-offs, before the buyout charge: $0.46 by our math, up 18.6% from $0.39 a year ago Because accounting rules treat the gap between the $1.69 billion cash buyout price and the balance-sheet value of the Series A units as a payout to preferred holders, reported profit per unit fell to a loss of $0.06. That one-time accounting charge masks an 18.6% rise in per-unit profit, by our math, and permanent annual cash savings. What to watch: preferred unit cash distributions in the first quarter of 2027, the first full period after the October Series B buyout. Dropping to zero from $82 million this quarter will confirm the full $0.09 per unit annual cash boost. 🟢 𝐓𝐰𝐨 𝐁𝐚𝐬𝐢𝐧 𝐃𝐞𝐚𝐥𝐬 𝐀𝐝𝐝 𝐃𝐞𝐝𝐢𝐜𝐚𝐭𝐞𝐝 𝐀𝐜𝐫𝐞𝐚𝐠𝐞 𝐟𝐨𝐫 𝟐𝟎𝟐𝟕 Management is redeploying cash from its Canadian exit into US crude gathering pipes that feed its main long-haul networks. On October 1, the partnership paid $585 million in cash to buy the Silver Creek gathering system in the Powder River Basin, an oil region Chief Executive Willie Chiang described as an area "where we expect significant production growth over the coming years, and enhanced integration with our existing downstream assets". Plains also signed 10-year agreements with a large integrated oil producer to expand its Permian joint venture gathering network in the Midland Basin. The deal adds about 270,000 dedicated acres and an estimated 225,000 barrels per day of gross volume starting in the fourth quarter of 2027, locking in multi-year supply without relying on higher oil prices. What to watch: Rocky Mountain pipeline tariff volumes in the fourth quarter, which stood at 470,000 barrels per day before Silver Creek closed. The initial step-up will show how much immediate daily volume the $585 million purchase adds. 🐻 𝐁𝐞𝐚𝐫 𝐂𝐚𝐬𝐞 🔴🔴 𝐑𝐚𝐭𝐞 𝐑𝐞𝐬𝐞𝐭𝐬 𝐚𝐧𝐝 𝐉𝐨𝐢𝐧𝐭 𝐕𝐞𝐧𝐭𝐮𝐫𝐞 𝐖𝐫𝐢𝐭𝐞-𝐃𝐨𝐰𝐧𝐬 𝐃𝐫𝐚𝐠 𝐨𝐧 𝐏𝐫𝐨𝐟𝐢𝐭 "Our company delivered solid operational performance year-to-date with continued execution across the organization on our key initiatives for the year," Chiang said. Yet older, high-priced shipping contracts in the Permian Basin keep expiring, and the company noted that "the impact from certain Permian long-haul contract rates resetting to market in 2025" reduced third-quarter results. At the same time, profit from unconsolidated joint ventures — pipelines Plains co-owns with other energy firms — fell 11.5% from a year ago to $85 million, and the partnership took a $68 million write-down on those investments. Operating margin also shrank by 0.8 percentage points to 3.4% as the cost of buying crude oil rose 1.0 percentage point to 92.5% of revenue. What to watch: equity earnings in unconsolidated entities in the fourth quarter. Another drop below the $89 million earned in last year's fourth quarter would show that lower tariff rates are still hurting joint-venture pipelines. 🔴 𝐄𝐧𝐯𝐢𝐫𝐨𝐧𝐦𝐞𝐧𝐭𝐚𝐥 𝐂𝐥𝐞𝐚𝐧𝐮𝐩 𝐚𝐧𝐝 𝐓𝐚𝐱𝐞𝐬 𝐋𝐢𝐟𝐭 𝐅𝐢𝐞𝐥𝐝 𝐎𝐩𝐞𝐫𝐚𝐭𝐢𝐧𝐠 𝐂𝐨𝐬𝐭𝐬 Plains plans to deliver $50 million of organizational cost savings across 2026. While general and administrative overhead fell 6.0% from a year ago to $78 million, field operating costs — the day-to-day expense of running and maintaining pipelines — rose 6.3% to $306 million. The partnership said "higher operating costs driven by environmental remediation expenses and property tax expense" offset part of its volume gains. Meanwhile, pipeline volume outside the Permian Basin was uneven, with Gulf Coast volume dropping 17.6% to 187,000 barrels per day and South Texas falling 6.1% to 505,000 barrels per day. What to watch: fourth-quarter field operating costs against last year's $281 million. A second straight quarter above $300 million would show that cleanup bills and property taxes are eating up the company's internal cost cuts. 👓 𝐎𝐭𝐡𝐞𝐫 𝐓𝐡𝐞𝐦𝐞𝐬 𝐌𝐚𝐧𝐚𝐠𝐞𝐦𝐞𝐧𝐭 𝐌𝐞𝐫𝐠𝐞𝐝 𝐈𝐭𝐬 𝐑𝐞𝐩𝐨𝐫𝐭𝐢𝐧𝐠 𝐒𝐞𝐠𝐦𝐞𝐧𝐭𝐬 𝐈𝐧𝐭𝐨 𝐎𝐧𝐞 Following the May 2026 sale of its Canadian NGL business, Plains combined its historical Crude Oil and NGL divisions into a single reporting segment. Management said it now runs commercial operations across North America "without regard to market or geographic location", which removes separate profit breakdowns for any remaining non-crude assets. 𝐌𝐚𝐧𝐚𝐠𝐞𝐦𝐞𝐧𝐭 𝐒𝐞𝐞𝐬 𝐓𝐚𝐢𝐥𝐰𝐢𝐧𝐝𝐬 𝐃𝐞𝐬𝐩𝐢𝐭𝐞 𝐎𝐢𝐥 𝐌𝐚𝐫𝐤𝐞𝐭 𝐒𝐰𝐢𝐧𝐠𝐬 Crude oil prices and producer drilling budgets have swung throughout 2026, keeping North American drillers cautious on near-term output. Even so, Chiang said the oil backdrop remains "volatile, yet constructive, and we see multiple tailwinds for our business as we build momentum into 2027" as new gathering pipes come online. — • — • — 💲 𝐎𝐭𝐡𝐞𝐫 𝐊𝐏𝐈𝐬 𝐂𝐚𝐬𝐡 𝐚𝐯𝐚𝐢𝐥𝐚𝐛𝐥𝐞 𝐟𝐨𝐫 𝐝𝐢𝐬𝐭𝐫𝐢𝐛𝐮𝐭𝐢𝐨𝐧 𝐩𝐞𝐫 𝐮𝐧𝐢𝐭 (𝟐𝟔𝐐𝟑): $𝟎.𝟔𝟕 ⇗ accelerating Implied distributable cash flow (DCF) per common unit — cash generated from operations after interest, taxes and maintenance, available to pay unitholders — rose 9.8% from $0.61 a year ago. After declining in the first quarter and rising 6.1% in the second, growth picked up and covered the $0.4175 quarterly distribution by 1.61 times. 𝐓𝐨𝐭𝐚𝐥 𝐝𝐞𝐛𝐭 (𝟐𝟔𝐐𝟑): $𝟗,𝟗𝟐𝟎 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating Total debt fell 11.9% from $11.26 billion at the end of 2025 as the pipeline operator used $3.53 billion in net proceeds from the Canadian asset sale to pay down borrowings. Including the October preferred buyout and Silver Creek purchase, the debt-to-EBITDA ratio stands at about 3.6 times, inside the 3.25 to 3.75 target range. 𝐂𝐚𝐩𝐢𝐭𝐚𝐥 𝐬𝐩𝐞𝐧𝐝𝐢𝐧𝐠 𝐧𝐞𝐭 𝐭𝐨 𝐏𝐥𝐚𝐢𝐧𝐬 (𝟐𝟔𝐐𝟑): $𝟏𝟐𝟒 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating Total investment and maintenance capital spending attributable to Plains fell 27.5% from $171 million a year ago, with growth project spending down $23 million to $96 million and maintenance down $24 million to $28 million. Lower capital spending after the Canadian sale helped lift free cash flow excluding working capital swings to $569 million. — • — • — 🔮 𝐆𝐮𝐢𝐝𝐚𝐧𝐜𝐞 𝐅𝐘𝟐𝟔 𝐀𝐝𝐣𝐮𝐬𝐭𝐞𝐝 𝐄𝐁𝐈𝐓𝐃𝐀 𝐚𝐭𝐭𝐫𝐢𝐛𝐮𝐭𝐚𝐛𝐥𝐞 𝐭𝐨 𝐏𝐀𝐀: $𝟐.𝟖𝟑𝟎–𝟐.𝟗𝟑𝟎 𝐛𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating 🠆 unchanged from $2.805–2.955 billion Unchanged at the middle of the range. Management narrowed the band by $25 million on each side, keeping the $2.88 billion target that calls for 1.7% total growth over 2025 after raising it by $130 million in the first quarter. By our math, that leaves $701 million for the fourth quarter, down 5.0% in total but up 13.8% against last year's continuing crude business. 𝐅𝐘𝟐𝟔 𝐂𝐫𝐮𝐝𝐞 𝐎𝐢𝐥 𝐀𝐝𝐣𝐮𝐬𝐭𝐞𝐝 𝐄𝐁𝐈𝐓𝐃𝐀 𝐠𝐫𝐨𝐰𝐭𝐡: ~$𝟑𝟕𝟎 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 (~𝟏𝟔%) ⇘ decelerating 🠅 raised from ~13% growth Raised from the 13% growth rate management set at the start of the year. The outlook calls for the continuing crude oil business to add about $370 million in cash profit over 2025, driven by a full year of the Cactus III pipeline and $100 million of combined deal synergies and internal cost cuts. — • — • — ❓ 𝐊𝐞𝐲 𝐐𝐮𝐞𝐬𝐭𝐢𝐨𝐧𝐬 𝐖𝐡𝐚𝐭 𝐜𝐚𝐮𝐬𝐞𝐝 𝐭𝐡𝐞 $𝟔𝟖 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 𝐣𝐨𝐢𝐧𝐭 𝐯𝐞𝐧𝐭𝐮𝐫𝐞 𝐰𝐫𝐢𝐭𝐞-𝐝𝐨𝐰𝐧? Plains recorded a $68 million impairment on its investments in unconsolidated entities and saw quarterly equity earnings fall 11.5% to $85 million. Management did not name which co-owned pipeline lost value or whether lower tariff rates triggered the charge. 𝐇𝐨𝐰 𝐦𝐮𝐜𝐡 𝐰𝐢𝐥𝐥 𝐒𝐢𝐥𝐯𝐞𝐫 𝐂𝐫𝐞𝐞𝐤 𝐚𝐝𝐝 𝐭𝐨 𝐟𝐨𝐮𝐫𝐭𝐡-𝐪𝐮𝐚𝐫𝐭𝐞𝐫 𝐩𝐫𝐨𝐟𝐢𝐭? The partnership closed its $585 million cash purchase of the Silver Creek gathering system on October 1 but kept its full-year cash profit target unchanged at $2.88 billion. Investors need to know how much fourth-quarter EBITDA Silver Creek contributes. 𝐇𝐨𝐰 𝐛𝐢𝐠 𝐚𝐫𝐞 𝐭𝐡𝐞 𝐞𝐧𝐯𝐢𝐫𝐨𝐧𝐦𝐞𝐧𝐭𝐚𝐥 𝐜𝐥𝐞𝐚𝐧𝐮𝐩 𝐜𝐨𝐬𝐭𝐬 𝐢𝐧 𝐟𝐢𝐞𝐥𝐝 𝐞𝐱𝐩𝐞𝐧𝐬𝐞𝐬? Field operating costs rose 6.3% from a year ago to $306 million, which the release blamed on environmental remediation and property taxes. Without the exact dollar size of the cleanup charges, readers cannot tell if the $50 million efficiency plan is working. 𝐖𝐡𝐚𝐭 𝐢𝐬 𝐭𝐡𝐞 𝐜𝐚𝐩𝐢𝐭𝐚𝐥 𝐜𝐨𝐬𝐭 𝐨𝐟 𝐭𝐡𝐞 𝐌𝐢𝐝𝐥𝐚𝐧𝐝 𝐁𝐚𝐬𝐢𝐧 𝐞𝐱𝐩𝐚𝐧𝐬𝐢𝐨𝐧? Plains announced a 10-year deal adding 270,000 dedicated acres and 225,000 barrels per day of gross volume in late 2027. The release did not state how much capital Plains and its joint-venture partner must spend to build the gathering pipes.

$BEN Q4 2026 earnings: Franklin Templeton beats its margin goal, but revenue lags assets Franklin Templeton, the global investment manager, cleared its long-term profit margin target early even as revenue barely grew. Chief executive Jenny Johnson said the firm pushed its operating margin excluding one-offs to 32%, beating the 30% plan while private-markets fundraising reached $43 billion for the year, above what the company's own plan pointed to. However, operating revenue rose only 4% from a year ago, and recurring severance charges kept the GAAP operating margin at 15%. • Operating revenue: $𝟐,𝟒𝟑𝟓𝐌 (+3.9% from a year ago) • Operating margin, excluding one-offs: 𝟑𝟏.𝟖% (26.0% a year ago) • Full-year private-markets fundraising: $𝟒𝟑.𝟐𝐁 (~$40B company plan) • Five-year margin and fundraising plan: 𝐔𝐧𝐜𝐡𝐚𝐧𝐠𝐞𝐝 (ahead of 30%+ margin target) ⚖️ 𝐕𝐞𝐫𝐝𝐢𝐜𝐭: 🟢 Bullish The story got better because client withdrawals at its troubled Western Asset bond unit finally stopped in the fourth quarter by our math, allowing private-market and ETF inflows to lift total client flows. Clearing the 30% adjusted margin target in the fourth quarter also proves that core compensation restraint is working. One caution: beating the implied fourth-quarter fundraising target shows the prior plan was cautious, while the backlog of unfunded institutional contracts fell by $7 billion from last quarter's record. The question now is whether shifting into private markets and custom wrappers can speed up revenue growth or if lower-fee ETFs will cancel out the gain. If higher-fee private funds win out, revenue growth will catch up to the 10% growth in average assets; if cheaper wrappers dominate, revenue will keep lagging. The 2027 fee and expense targets on today's conference call will tell. Full article with charts - link in bio 🐂 𝐁𝐮𝐥𝐥 𝐂𝐚𝐬𝐞 🟢🟢 𝐎𝐩𝐞𝐫𝐚𝐭𝐢𝐧𝐠 𝐌𝐚𝐫𝐠𝐢𝐧 𝐂𝐥𝐞𝐚𝐫𝐞𝐝 𝟑𝟎% 𝐀𝐡𝐞𝐚𝐝 𝐨𝐟 𝐏𝐥𝐚𝐧 Franklin Templeton, the global investment manager, set a five-year goal to push its operating margin excluding one-offs above 30%. Chief executive Jenny Johnson said the firm is "increasing our adjusted operating margin ahead of plan". In the fourth quarter, that margin reached 31.8%, up from 28.0% last quarter and 26.0% a year ago, beating the nearly 30% target management set three months ago. Lower core costs drove the expansion. While operating revenue rose 3.9% from a year ago to $2.43 billion, employee compensation and benefits stayed nearly flat at $1.01 billion, falling by 1.5 percentage points of revenue by our math. Excluding one-offs and pass-through distribution fees, operating expenses fell by 5.7 percentage points of adjusted revenue, lifting full-year operating profit excluding one-offs by 23% to $2.02 billion. What to watch: the 2027 expense and margin forecast in the written commentary or conference call. Management previously pointed to a 29% to 30% full-year margin for 2027, and a target above 30% would show the fourth-quarter cost structure can hold. 🟢🟢 𝐏𝐫𝐢𝐯𝐚𝐭𝐞 𝐌𝐚𝐫𝐤𝐞𝐭𝐬 𝐚𝐧𝐝 𝐍𝐞𝐰 𝐖𝐫𝐚𝐩𝐩𝐞𝐫𝐬 𝐃𝐫𝐨𝐯𝐞 𝐈𝐧𝐟𝐥𝐨𝐰𝐬 The asset manager is shifting its business toward alternative investments—such as private credit, real estate, and secondary private-equity funds—and lower-cost customizable fund wrappers. Johnson pointed to "growing demand for private markets, customized solutions and innovative investment vehicles" as the driver of the firm's five-year plan. Fourth-quarter fundraising in private markets reached $10.2 billion by our math, beating the roughly $7 billion implied by management's prior $40 billion full-year forecast. • Alternative assets under management: $304.6 billion, up 15.4% from a year ago, with $48.7 billion in total full-year fundraising • Private-markets fundraising: $43.2 billion for the year, almost double the $22.9 billion raised in fiscal 2025 • Exchange-traded funds (ETFs), which are tradable fund baskets: $84.6 billion in assets, up 73% from a year ago • Retail separately managed accounts (SMAs), individual portfolios for wealthy clients: $196.3 billion, up 19% • Canvas, the firm's software for building custom index portfolios: $32.6 billion in assets, doubling in one year These inflows matter because private-market funds lock up client money for years and charge higher management fees, which helps offset client withdrawals from older mutual funds. However, the release did not state whether Lexington's flagship secondary fund cleared its $10 billion target by September. What to watch: the 2027 private-markets fundraising target on the conference call. A number near $40 billion would show the momentum can continue without relying on a single flagship fund close. 🟢 𝐖𝐞𝐬𝐭𝐞𝐫𝐧 𝐀𝐬𝐬𝐞𝐭 𝐎𝐮𝐭𝐟𝐥𝐨𝐰𝐬 𝐒𝐭𝐨𝐩𝐩𝐞𝐝 𝐢𝐧 𝐭𝐡𝐞 𝐅𝐨𝐮𝐫𝐭𝐡 𝐐𝐮𝐚𝐫𝐭𝐞𝐫 Western Asset Management (WAM), the company's bond-fund specialist, suffered $141.9 billion in client withdrawals during fiscal 2025 amid federal investigations. After the US firm settled the regulatory probes in the third quarter, the bleeding stopped. Full-year long-term net outflows at WAM totaled $11.7 billion, and because outflows through the first nine months were already $11.8 billion, WAM recorded about $0.1 billion of net inflows in the fourth quarter by our math. That stabilization lifted total long-term net inflows across the firm to $20.8 billion for the quarter and $84.1 billion for the year, reversing last year's $97.4 billion net outflow. Company-wide fixed income funds lost just $0.6 billion in net client money this quarter, compared with $12.6 billion a year ago. One print only fades the concern over WAM's recovery, because halting withdrawals is easier than winning back large bond mandates. What to watch: WAM's standalone net flows in the first quarter of fiscal 2027. A second straight quarter of positive flows would confirm that institutional consultants have put the bond unit back on their buy lists. 🐻 𝐁𝐞𝐚𝐫 𝐂𝐚𝐬𝐞 🔴🔴 𝐒𝐞𝐯𝐞𝐫𝐚𝐧𝐜𝐞 𝐂𝐡𝐚𝐫𝐠𝐞𝐬 𝐖𝐢𝐝𝐞𝐧𝐞𝐝 𝐭𝐡𝐞 𝐆𝐚𝐩 𝐭𝐨 𝐆𝐀𝐀𝐏 𝐏𝐫𝐨𝐟𝐢𝐭 Johnson highlighted discipline in managing expenses while celebrating the 31.8% operating margin excluding one-offs. Yet the GAAP operating margin was less than half that figure at 14.6%, because the firm excluded $242.8 million of charges in the quarter. The largest adjustment was $81.1 million for special termination benefits—severance pay for "workforce optimization initiatives related to past acquisitions and certain initiatives undertaken by the Company". Those severance charges are not a one-time event. They rose from $25.0 million a year ago and $77.2 million last quarter, bringing the full-year severance bill to $204.5 million, nearly triple the $69.7 million spent in fiscal 2025. The investment group also excluded $79.0 million in acquisition retention and transaction costs in the fourth quarter. Treating ongoing staff cuts as one-off items overstates the cash profit of the business. What to watch: special termination benefits in the first quarter of 2027. If quarterly severance stays near $80 million after the cost program's target year has ended, the gap between GAAP and adjusted profit will remain wide. 🔴 𝐓𝐡𝐞 𝐔𝐧𝐟𝐮𝐧𝐝𝐞𝐝 𝐈𝐧𝐬𝐭𝐢𝐭𝐮𝐭𝐢𝐨𝐧𝐚𝐥 𝐏𝐢𝐩𝐞𝐥𝐢𝐧𝐞 𝐃𝐫𝐨𝐩𝐩𝐞𝐝 𝐛𝐲 $𝟔.𝟔 𝐁𝐢𝐥𝐥𝐢𝐨𝐧 Franklin Templeton tracks its institutional pipeline of won-but-unfunded mandates, which are investment contracts large clients have awarded to the firm but have not yet funded with cash. Johnson said that "our institutional pipeline of won-but-unfunded mandates remained strong at $22.0 billion". However, that backlog fell by $6.6 billion, or 23% by our math, from the record $28.6 billion reported three months ago. A shrinking backlog is natural when won contracts convert into funded assets, and long-term inflows remained high at $114.7 billion in the quarter. Even so, the $6.6 billion drop in the pipeline was larger than the $2.4 billion sequential increase in net long-term flows, which means new institutional wins did not replace the mandates that funded during the quarter. That leaves less guaranteed funding for early 2027. What to watch: the won-but-unfunded pipeline in the first quarter of 2027. A drop below $20 billion would show that institutional demand is cooling after the third-quarter spike. 🔴 𝐌𝐚𝐫𝐤𝐞𝐭 𝐌𝐨𝐯𝐞𝐬 𝐂𝐮𝐭 𝐀𝐬𝐬𝐞𝐭𝐬 𝐰𝐡𝐢𝐥𝐞 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 𝐁𝐚𝐫𝐞𝐥𝐲 𝐆𝐫𝐞𝐰 Asset managers earn most of their revenue as a percentage of assets under management (AUM), the total market value of client investments they oversee. In the fourth quarter, net market change, client distributions, and foreign exchange reduced AUM by $11.3 billion, while clients pulled $6.0 billion from cash management funds. As a result, ending AUM rose just 0.2% from last quarter to $1,795.1 billion, despite $20.8 billion in long-term net inflows. Because fast-growing products like ETFs and Canvas charge lower percentage fees than traditional stock mutual funds, revenue growth is lagging asset growth. Average AUM rose 10.3% from a year ago, but investment management fees grew only 4.1% to $1.95 billion, and total operating revenue rose 3.9%. When markets pause or distributions drain assets, the shift toward cheaper wrappers leaves top-line growth modest. What to watch: the effective fee rate in the written commentary. A drop below 37.5 basis points would confirm that rapid ETF and SMA growth is compressing the average fee earned per dollar of assets. 🔴 𝐑𝐢𝐬𝐤𝐬 𝐭𝐡𝐢𝐬 𝐪𝐮𝐚𝐫𝐭𝐞𝐫 𝐝𝐢𝐝𝐧'𝐭 𝐚𝐧𝐬𝐰𝐞𝐫 Four standing concerns could not be tested because the preliminary earnings release omits detailed fee tables, call commentary, and legal footnotes. • Average management fee rate: not in the release; the written commentary will show if it held the 37.5 to 37.8 basis-point target. • Brokerage platform fees: no update in the release on whether higher fees paid to wealth platforms like Schwab and Merrill are squeezing net revenue. • Uncalled capital in inflows: Footnote 5 confirms fiscal 2026 inflows include non-fee-generating uncalled commitments, but the release still does not disclose the dollar amount. • Ongoing lawsuits: no update on the WAM class action, the 401(k) case, or the Putnam suit until the annual Form 10-K filing. — • — • — 💲 𝐎𝐭𝐡𝐞𝐫 𝐊𝐏𝐈𝐬 𝐂𝐚𝐬𝐡 𝐚𝐧𝐝 𝐢𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭𝐬 𝐢𝐧𝐜𝐥𝐮𝐝𝐢𝐧𝐠 𝐜𝐨𝐧𝐬𝐨𝐥𝐢𝐝𝐚𝐭𝐞𝐝 𝐟𝐮𝐧𝐝𝐬 (𝟐𝟔𝐐𝟒): $𝟕.𝟒 𝐛𝐢𝐥𝐥𝐢𝐨𝐧 ⇗ accelerating Total liquidity rose by $0.9 billion, or 13.8% by our math, from $6.5 billion last quarter, and is up from $6.7 billion a year ago. The balance includes $6.0 billion of corporate cash and investments plus $1.3 billion invested directly in consolidated investment products (CIPs), which are funds the company controls and reports on its own balance sheet. 𝐃𝐢𝐥𝐮𝐭𝐞𝐝 𝐬𝐡𝐚𝐫𝐞 𝐜𝐨𝐮𝐧𝐭 𝐚𝐧𝐝 𝐛𝐮𝐲𝐛𝐚𝐜𝐤𝐬 (𝟐𝟔𝐐𝟒): 𝟓𝟎𝟗.𝟐 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating Average diluted shares fell 1.2% from a year ago and 1.3% from last quarter after the third quarter's large block repurchase. In the fourth quarter, Franklin Templeton slowed its buybacks, spending $86.1 million to repurchase 2.5 million shares, down 75% by our math from the $348.1 million spent on 10.4 million shares in the prior quarter. 𝐒𝐚𝐥𝐞𝐬, 𝐝𝐢𝐬𝐭𝐫𝐢𝐛𝐮𝐭𝐢𝐨𝐧 𝐚𝐧𝐝 𝐦𝐚𝐫𝐤𝐞𝐭𝐢𝐧𝐠 𝐞𝐱𝐩𝐞𝐧𝐬𝐞 (𝟐𝟔𝐐𝟒): $𝟓𝟔𝟎.𝟐 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇗ accelerating Distribution costs paid to financial advisers and brokers rose 7.8% from a year ago and 0.9% from last quarter. Over the last four quarters, this expense climbed steadily from $540.9 million to $560.2 million, growing twice as fast as total operating revenue (+3.9% from a year ago) and outpacing the 5.6% growth in sales and distribution fee revenue. — • — • — 🔮 𝐆𝐮𝐢𝐝𝐚𝐧𝐜𝐞 𝐅𝐢𝐯𝐞-𝐲𝐞𝐚𝐫 𝐒𝐭𝐫𝐚𝐭𝐞𝐠𝐢𝐜 𝐏𝐥𝐚𝐧 𝐎𝐮𝐭𝐥𝐨𝐨𝐤: 𝐀𝐡𝐞𝐚𝐝 𝐨𝐟 𝐩𝐥𝐚𝐧 ⇗ accelerating 🠆 unchanged from Ahead of 5-year plan (30%+ margin target; $100B private markets fundraising by FY29) Unchanged. Johnson reiterated that the asset manager is increasing its operating margin excluding one-offs ahead of its five-year plan, which targets a margin above 30% and $100 billion in cumulative private-markets fundraising by fiscal 2029. With the fourth-quarter margin at 31.8% and two-year private-markets fundraising at $66.1 billion by our math, the company is two-thirds of the way to its fundraising goal after two years. — • — • — ❓ 𝐊𝐞𝐲 𝐐𝐮𝐞𝐬𝐭𝐢𝐨𝐧𝐬 𝐖𝐡𝐚𝐭 𝐚𝐫𝐞 𝐭𝐡𝐞 𝐞𝐱𝐩𝐞𝐧𝐬𝐞 𝐚𝐧𝐝 𝐟𝐮𝐧𝐝𝐫𝐚𝐢𝐬𝐢𝐧𝐠 𝐭𝐚𝐫𝐠𝐞𝐭𝐬 𝐟𝐨𝐫 𝟐𝟎𝟐𝟕? On last quarter's call, management promised to give fiscal 2027 projections for alternatives fundraising and operating expenses with the fourth-quarter results. Those numbers do not appear in the preliminary release and are needed to test if the 31.8% margin will hold. 𝐇𝐨𝐰 𝐦𝐮𝐜𝐡 𝐨𝐟 𝐭𝐡𝐞 $𝟖𝟒.𝟏 𝐛𝐢𝐥𝐥𝐢𝐨𝐧 𝐢𝐧𝐟𝐥𝐨𝐰 𝐰𝐚𝐬 𝐮𝐧𝐜𝐚𝐥𝐥𝐞𝐝 𝐜𝐚𝐩𝐢𝐭𝐚𝐥? Footnote 5 notes that fiscal 2026 long-term inflows include non-fee-generating uncalled capital commitments, without restating prior years. Management still has not disclosed the dollar amount, making it impossible to compare this year's inflows cleanly with fiscal 2025. 𝐖𝐡𝐲 𝐝𝐢𝐝 𝐢𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐟𝐞𝐞𝐬 𝐠𝐫𝐨𝐰 𝐡𝐚𝐥𝐟 𝐚𝐬 𝐟𝐚𝐬𝐭 𝐚𝐬 𝐚𝐬𝐬𝐞𝐭𝐬? Average assets under management rose 10.3% from a year ago in the fourth quarter, but investment management fees grew only 4.1%. Investors need the fourth-quarter effective fee rate to see how much ETF and SMA growth is lowering average fee rates. 𝐖𝐡𝐞𝐧 𝐰𝐢𝐥𝐥 𝐪𝐮𝐚𝐫𝐭𝐞𝐫𝐥𝐲 𝐰𝐨𝐫𝐤𝐟𝐨𝐫𝐜𝐞 𝐬𝐞𝐯𝐞𝐫𝐚𝐧𝐜𝐞 𝐜𝐡𝐚𝐫𝐠𝐞𝐬 𝐞𝐧𝐝? Special termination benefits reached $81.1 million in the fourth quarter and $204.5 million for the full year. Management has excluded these costs from adjusted profit every quarter for two years without giving an end date for the layoffs.

$PAA Q3 2026 earnings: Plains All American cash profit rises, while Permian volumes pause Plains All American Pipeline, the North American crude oil pipeline operator, grew continuing cash profit while its main basin volumes paused. Operating cash profit from continuing businesses rose 21% from a year ago to $711 million, matching what the full-year plan pointed to. Chief executive Willie Chiang kept the $2.88 billion full-year target in place, which by our math leaves $701 million for the fourth quarter. • Operating cash profit from continuing businesses: $𝟕𝟏𝟏𝐌 (+21% from a year ago) • Total operating cash profit attributable to PAA: $𝟕𝟏𝟏𝐌 (+6% from a year ago) • Distributable cash flow per unit: $𝟎.𝟔𝟕 (+10% from a year ago) • Full-year operating cash profit outlook: 𝐔𝐧𝐜𝐡𝐚𝐧𝐠𝐞𝐝 (middle of the range: $2.88B (band narrowed)) ⚖️ 𝐕𝐞𝐫𝐝𝐢𝐜𝐭: 🟢 Bullish The story got better because the partnership held its $700 million quarterly cash profit pace without the spring's oil-trading windfall and locked in $60 million of annual financing savings by retiring preferred equity. One caution: Permian pipeline volumes barely budged from the second quarter, and a $68 million joint-venture writedown alongside environmental cleanup costs weighed on earnings. The question now is whether core crude pipeline volumes can drive growth in 2027 before new gathering projects start up late next year. Either the October Silver Creek acquisition and cost cuts lift profit, or flat Permian throughput and lower contract rates hold earnings near the current run rate. Management's 2027 outlook in February will settle it. Full article with charts - link in bio 🐂 𝐁𝐮𝐥𝐥 𝐂𝐚𝐬𝐞 🟢🟢 𝐂𝐨𝐧𝐭𝐢𝐧𝐮𝐢𝐧𝐠 𝐂𝐚𝐬𝐡 𝐏𝐫𝐨𝐟𝐢𝐭 𝐑𝐨𝐬𝐞 𝟐𝟏% 𝐀𝐟𝐭𝐞𝐫 𝐭𝐡𝐞 𝐂𝐚𝐧𝐚𝐝𝐚 𝐄𝐱𝐢𝐭 Plains All American Pipeline sold its Canadian natural gas liquids (NGL) business in May 2026 to focus on crude oil pipelines. Because last year's third quarter still included $80 million from that sold division, headline Adjusted EBITDA attributable to Plains — operating cash profit excluding one-offs and joint-venture partner shares — rose 6% to $711 million. In continuing operations alone, operating cash profit jumped 20.7% from $589 million a year ago. By our math, continuing cash profit also edged up 1.3% from the second quarter's $702 million, which eased concerns that second-quarter trading gains from Middle East oil volatility would reverse. Chief executive Willie Chiang called the oil macro environment "volatile, yet constructive, and we see multiple tailwinds for our business as we build momentum into 2027". General and administrative overhead fell 6% from a year ago to $78 million as the pipeline partnership stayed on track to cut $50 million in costs this year. What to watch: fourth-quarter Adjusted EBITDA attributable to the partnership. By our math, the full-year midpoint requires $701 million in the fourth quarter, which will show whether core crude fees can hold the $700 million quarterly level without trading tailwinds. 🟢 𝐑𝐞𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐧𝐠 𝐏𝐫𝐞𝐟𝐞𝐫𝐫𝐞𝐝 𝐔𝐧𝐢𝐭𝐬 𝐀𝐝𝐝𝐬 $𝟔𝟎 𝐌𝐢𝐥𝐥𝐢𝐨𝐧 𝐚 𝐘𝐞𝐚𝐫 After paying down debt with its Canadian sale proceeds in the spring, Plains reworked its balance sheet to cut financing payouts. Chiang said the partnership issued junior subordinated notes and redeemed preferred equity "to generate distributable cash flow accretion to common unitholders". • Series A preferred buyout: all 58.4 million units repurchased on September 14 for $1.687 billion • Series B preferred buyout: all 0.8 million units repurchased on October 9 for $800 million • New debt funding: $1.5 billion of junior subordinated notes issued • Cash savings for common unitholders: about $60 million a year, or $0.09 per unit Replacing expensive preferred distributions with lower-cost subordinated debt adds 5% to the partnership's annual $1.67 per unit cash payout without requiring extra pipeline volume. That trade pushed pro forma debt leverage — net debt divided by annual operating cash profit — up from 3.3 times in June to 3.6 times, near the top of the partnership's 3.25 to 3.75 target range. What to watch: preferred unit cash distributions in the first quarter of 2027. With both Series A and Series B retired, quarterly preferred cash payouts should drop to zero from $82 million this quarter. 🟢 𝐍𝐞𝐰 𝐌𝐢𝐝𝐥𝐚𝐧𝐝 𝐚𝐧𝐝 𝐏𝐨𝐰𝐝𝐞𝐫 𝐑𝐢𝐯𝐞𝐫 𝐃𝐞𝐚𝐥𝐬 𝐁𝐮𝐢𝐥𝐝 𝟐𝟎𝟐𝟕 𝐕𝐨𝐥𝐮𝐦𝐞 The Houston-based group is pairing bolt-on pipeline purchases with multi-year drilling commitments to replace the earnings it sold in Canada. On October 1, the partnership closed the $585 million cash purchase of Silver Creek, a crude oil gathering system in Wyoming, which Chiang said "provides Plains with immediate scale in the Powder River Basin, where we expect significant production growth over the coming years". Management also announced "a further expansion of our Permian gathering footprint to service additional acreage in the Midland Basin with a large integrated producer", adding 270,000 dedicated acres under 10-year contracts that bring about 225,000 barrels a day of gross volume starting in late 2027. In addition, the firm captured its full $50 million synergy target from last year's Cactus III pipeline acquisition. What to watch: fourth-quarter Rocky Mountain pipeline tariff volumes. Silver Creek closed on the first day of the fourth quarter, so next quarter's regional volume table will give the first clean read on its daily barrel contribution. 🐻 𝐁𝐞𝐚𝐫 𝐂𝐚𝐬𝐞 🔴🔴 𝐏𝐞𝐫𝐦𝐢𝐚𝐧 𝐕𝐨𝐥𝐮𝐦𝐞 𝐆𝐫𝐨𝐰𝐭𝐡 𝐒𝐥𝐨𝐰𝐞𝐝 𝐭𝐨 𝟖% 𝐚𝐬 𝐑𝐚𝐭𝐞𝐬 𝐑𝐞𝐬𝐞𝐭 "Our company delivered solid operational performance year-to-date with continued execution across the organization on our key initiatives for the year," chief executive Willie Chiang said. Yet pipeline tariff volumes in the Permian Basin — the Texas and New Mexico oilfield that supplies over three-quarters of the partnership's throughput — barely moved from the second quarter. Permian volumes averaged 8,071 thousand barrels a day, up just 0.3% from 8,045 thousand in the second quarter, while growth from a year ago slowed to 7.8% from 11.4% in the spring. Across all regions, total crude oil pipeline volumes slipped 0.8% from the second quarter to 10,507 thousand barrels a day, with South Texas down 6.1% and the Gulf Coast down 17.6% from a year ago. At the same time, the partnership noted that higher volumes were partially offset by "certain Permian long-haul contract rates resetting to market in 2025". Because last year's fourth-quarter acquisition of the Cactus III pipeline sits inside this year's volume totals, the sequential stall suggests underlying basin volume growth is cooling just as older, higher-priced transport contracts roll off. What to watch: Permian Basin daily pipeline volumes in the fourth quarter. Earlier this year management projected full-year Permian volumes of 8,000 thousand barrels a day, and a second flat quarter would show basin growth is stalling before 2027. 🔴 𝐉𝐨𝐢𝐧𝐭 𝐕𝐞𝐧𝐭𝐮𝐫𝐞 𝐖𝐫𝐢𝐭𝐞𝐝𝐨𝐰𝐧𝐬 𝐚𝐧𝐝 𝐑𝐞𝐦𝐞𝐝𝐢𝐚𝐭𝐢𝐨𝐧 𝐂𝐨𝐬𝐭𝐬 𝐇𝐢𝐭 𝐏𝐫𝐨𝐟𝐢𝐭 Operating margin slipped 0.8 percentage points from a year ago to 3.4% of revenue as higher crude oil prices inflated pass-through purchase costs and field expenses rose. Field operating costs — the day-to-day expense of running and repairing pipelines — climbed 6.3% from a year ago to $306 million (2.0% of revenue), driven by "environmental remediation expenses and property tax expense". Below the operating line, the pipeline operator booked a $68 million impairment charge on its investments in unconsolidated joint ventures, while equity earnings from those partnerships fell 11.5% from a year ago to $85 million. Management strips the $68 million writedown out of Adjusted EBITDA, but the lower joint-venture earnings and recurring environmental charges directly reduce cash profit. What to watch: footnote disclosures on the $68 million joint-venture impairment and environmental reserves in the third-quarter Form 10-Q filing. That filing will show which pipeline partnership lost value and whether California cleanup costs expanded again. 🔴 𝐑𝐢𝐬𝐤𝐬 𝐭𝐡𝐢𝐬 𝐪𝐮𝐚𝐫𝐭𝐞𝐫 𝐝𝐢𝐝𝐧'𝐭 𝐚𝐧𝐬𝐰𝐞𝐫 Five standing risks from prior quarters could not be tested because their disclosures live in the quarterly Form 10-Q filing or conference call remarks rather than the earnings release. • Contracted revenue backlog: remaining performance obligations under minimum volume contracts ($3.30 billion in June) are only reported in the Form 10-Q footnotes. • Cactus III long-term contracting: the release did not state whether the new 75,000 barrel-a-day expansion is signed to third-party fee contracts or still filled by Plains' own marketing desk. • 2027 oil price hedges: the partnership has not yet updated hedging for its pipeline loss allowance barrels beyond 2026. • Heavy-crude price spreads: the release collapsed regional reporting and gave no detail on Canadian heavy-oil differentials. • Canadian sale liabilities: any updates on the $62 million tax indemnity or regulatory litigation from the Keyera transaction await the Form 10-Q legal footnotes. 👓 𝐎𝐭𝐡𝐞𝐫 𝐓𝐡𝐞𝐦𝐞𝐬 𝐎𝐧𝐞-𝐓𝐢𝐦𝐞 𝐏𝐫𝐞𝐟𝐞𝐫𝐫𝐞𝐝 𝐔𝐧𝐢𝐭 𝐁𝐮𝐲𝐨𝐮𝐭 𝐏𝐮𝐬𝐡𝐞𝐝 𝐔𝐧𝐢𝐭 𝐏𝐫𝐨𝐟𝐢𝐭 𝐍𝐞𝐠𝐚𝐭𝐢𝐯𝐞 Plains reported a net loss per common unit of $0.06 ($0.04 loss excluding one-offs) even though net income attributable to the partnership was $363 million. When the group paid $1.687 billion to retire its Series A preferred units, accounting rules required it to deduct the $358 million excess over book value from common unitholders' profit (worth $0.51 per unit by our math). Separately, management merged its Crude Oil and NGL divisions into a single reporting segment. — • — • — 💲 𝐎𝐭𝐡𝐞𝐫 𝐊𝐏𝐈𝐬 𝐈𝐦𝐩𝐥𝐢𝐞𝐝 𝐝𝐢𝐬𝐭𝐫𝐢𝐛𝐮𝐭𝐚𝐛𝐥𝐞 𝐜𝐚𝐬𝐡 𝐟𝐥𝐨𝐰 𝐩𝐞𝐫 𝐮𝐧𝐢𝐭 (𝟐𝟔𝐐𝟑): $𝟎.𝟔𝟕 ⇗ accelerating Implied distributable cash flow (DCF) — operating cash profit after interest, taxes, maintenance spending and preferred payouts — rose 9.8% from a year ago to $0.67 per common unit ($476 million total). That covered the $0.4175 quarterly distribution by 1.61 times, leaving $181 million in excess cash. 𝐓𝐨𝐭𝐚𝐥 𝐝𝐞𝐛𝐭 (𝟐𝟔𝐐𝟑): $𝟗,𝟗𝟐𝟎 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇄ reversing Total debt climbed 17.5% from $8,441 million in June as the partnership issued $1,479 million (net) in junior subordinated notes to buy back preferred equity. Even with that borrowing, total debt remains down 11.9% from $11,262 million at the end of 2025, and equals 51% of total book capitalization. 𝐂𝐚𝐩𝐢𝐭𝐚𝐥 𝐞𝐱𝐩𝐞𝐧𝐝𝐢𝐭𝐮𝐫𝐞𝐬 𝐧𝐞𝐭 𝐭𝐨 𝐏𝐀𝐀 (𝟐𝟔𝐐𝟑): $𝟏𝟐𝟒 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating Total capital spending attributable to Plains fell 27.5% from $171 million a year ago. Investment spending on growth projects dropped 19.3% to $96 million ($253 million over nine months), while maintenance spending fell 46.2% to $28 million following the sale of the Canadian NGL facilities. — • — • — 🔮 𝐆𝐮𝐢𝐝𝐚𝐧𝐜𝐞 𝐅𝐘𝟐𝟔 𝐀𝐝𝐣𝐮𝐬𝐭𝐞𝐝 𝐄𝐁𝐈𝐓𝐃𝐀 𝐚𝐭𝐭𝐫𝐢𝐛𝐮𝐭𝐚𝐛𝐥𝐞 𝐭𝐨 𝐏𝐀𝐀: $𝟐.𝟖𝟖𝟎 𝐛𝐢𝐥𝐥𝐢𝐨𝐧 +/- $𝟓𝟎 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 ⇘ decelerating 🠆 unchanged from $2.880 billion +/- $75 million Unchanged at the middle of the range, with the band narrowed by $25 million on each side. The plan calls for 1.7% headline growth for the year, including roughly $370 million (16%) growth in crude oil. By our math, that leaves $701 million for the fourth quarter — up 14.7% from a year ago against last year's crude oil result, but down 1.4% from the third quarter. — • — • — ❓ 𝐊𝐞𝐲 𝐐𝐮𝐞𝐬𝐭𝐢𝐨𝐧𝐬 𝐖𝐡𝐚𝐭 𝐡𝐚𝐩𝐩𝐞𝐧𝐬 𝐭𝐨 𝐭𝐡𝐞 𝐟𝐨𝐮𝐫𝐭𝐡-𝐪𝐮𝐚𝐫𝐭𝐞𝐫 𝐠𝐫𝐨𝐰𝐭𝐡 𝐜𝐚𝐩𝐢𝐭𝐚𝐥 𝐛𝐮𝐝𝐠𝐞𝐭? Nine-month investment spending net to Plains reached only $253 million after a $96 million third quarter. If the prior $400 million to $450 million full-year target still holds, fourth-quarter spending must jump to at least $147 million. 𝐖𝐡𝐢𝐜𝐡 𝐣𝐨𝐢𝐧𝐭 𝐯𝐞𝐧𝐭𝐮𝐫𝐞 𝐭𝐫𝐢𝐠𝐠𝐞𝐫𝐞𝐝 𝐭𝐡𝐞 $𝟔𝟖 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 𝐰𝐫𝐢𝐭𝐞𝐝𝐨𝐰𝐧? Plains booked a $68 million impairment on investments in unconsolidated entities while equity earnings fell 11.5% from a year ago. Investors need to know which pipeline partnership lost value and whether its cash distributions will drop. 𝐈𝐬 𝐭𝐡𝐞 𝐩𝐨𝐬𝐭-𝐬𝐚𝐥𝐞 𝐬𝐩𝐞𝐜𝐢𝐚𝐥 𝐭𝐚𝐱 𝐝𝐢𝐬𝐭𝐫𝐢𝐛𝐮𝐭𝐢𝐨𝐧 𝐜𝐚𝐧𝐜𝐞𝐥𝐥𝐞𝐝? Management previously outlined a special payout of up to $0.15 per unit to help unitholders cover taxes from the Canadian NGL sale. Two quarters after the May closing, the release still makes no mention of it. 𝐃𝐢𝐝 𝐧𝐞𝐰 𝐩𝐢𝐩𝐞𝐥𝐢𝐧𝐞 𝐜𝐨𝐧𝐭𝐫𝐚𝐜𝐭𝐬 𝐫𝐞𝐩𝐥𝐚𝐜𝐞 𝐪𝐮𝐚𝐫𝐭𝐞𝐫𝐥𝐲 𝐛𝐚𝐜𝐤𝐥𝐨𝐠 𝐫𝐮𝐧𝐨𝐟𝐟? Minimum volume commitments stood at $3.30 billion in June, with about $166 million rolling off each quarter. Because the release does not include the backlog table, investors must check the Form 10-Q to see if Cactus III added long-term contracts.