Greetings, and welcome to Cinemark Holdings Q1 2026 earnings conference call. At this time, all participants are on a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone requires operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Chanda Brashears, Senior Vice President, Investor Relations. Thank you. You may begin. Good morning, everyone, and thank you for joining us today to discuss our first quarter 2026 results. Our earnings release, executive commentary, and 10-Q were issued earlier this morning and are available on our website at ir.cinemark.com. Today's call is being webcast with a replay and transcript available on our website after the call. Before we begin, I'd like to remind everyone that during this conference call, we will make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may include, but are not necessarily limited to, financial projections or other statements of the company's plans, objectives, expectations, or intentions. Forward-looking statements are subject to risks and uncertainties that could cause the company's actual results to materially differ from those expressed or implied. The factors that could cause results to differ materially are detailed in our most recent annual form report on 10-K, as well as with the SEC and available on our website. Today's call will include non-GAAP financial measures. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the website's most recently filed earnings release, 10-Q, and on the company's website at ir.cinemark.com. Joining me this morning are Sean Gamble, President and CEO, and Melissa Thomas, CFO. Consistent with last quarter, Sean will provide some brief introductory remarks, and then we'll turn it over to Q&A. Sean? Thank you, Chanda, and good morning, everyone. The first quarter of 2026 marked our strongest first quarter since the onset of the pandemic across all revenue categories and adjusted EBITDA, with meaningful year-over-year top-line growth and margin expansion. Worldwide revenue increased 19% versus 2025 to $643 million. Adjusted EBITDA grew 143% to $88 million, and our adjusted EBITDA margin expanded 710 basis points. Our results are indicative of our team's ability to effectively capitalize on a strengthening box office environment while continuing to derive benefits from our sustained efforts to deliver unmatched entertainment for our guests, build audiences, grow new sources of revenue, strengthen our operating capabilities, and optimize our circuit. As described in greater detail in our executive commentary that we published this morning, we believe our standout first quarter performance is the byproduct of strong operational execution and our advantaged market position, which continues to be reinforced by our ongoing investments and strategic initiatives. From an execution standpoint, we achieved significant year-over-year box office growth and sustained the sizable market share gains we've achieved over the past several years through impactful programming actions and far-reaching marketing strategies that boosted attendance. As a more compelling slate of films was released into our theaters, we were able to leverage our extensive consumer marketing network and sophisticated scheduling tools to help amplify film awareness and optimize screen utilization to drive ticket sales. Furthermore, actions we pursued to increase engagement and stimulate food and beverage consumption drove record-high concession sales, and diligent labor and overall cost management, combined with improved operating leverage, contributed to our significant margin expansion in the quarter. Complementing our execution, the initiatives we are pursuing to drive incremental growth and productivity continue to position Cinemark for long-term success. These initiatives include a wide range of actions focused on sustaining our high-quality theaters, expanding premium amenities, and leveraging new technologies to further advance our operating capabilities. Examples include sustained investments we're making in enhanced screen formats, laser projectors, and motion seats, as well as the overall upkeep of our theaters to ensure our guests enjoy a premium experience at Cinemark regardless of which auditorium they choose. Additionally, we continue to actively expand data-rich tools and automation throughout our operating practices to strengthen our decision-making, enhance our customer journey, and improve process efficiencies. As we look ahead, we maintain our confidence in Cinemark's long-term growth prospects on account of our solid financial position, distinct competitive advantages, and the multitude of opportunities we have to drive incremental value. Furthermore, we are highly encouraged by continued positive momentum in our industry's core fundamentals, namely sustained consumer enthusiasm for larger-than-life cinematic experiences, strength of upcoming film content, and robust studio support of theatrical exhibition. These fundamentals were recently reinforced by moviegoing results in the first quarter and at CinemaCon last month, as filmmakers and studio executives reaffirmed their steadfast commitment to theatrical experiences and showcased a diverse and plentiful volume of compelling films that will be released over the coming years. Moreover, there's been constructive progress over the past several weeks in expanding the theatrical window, which is an important factor in the long-term health of the film ecosystem. We remain bullish on our future, and we are thrilled with the strong kickoff to 2026 as well as the promising lineup of films on the horizon, particularly in light of last week's successful opening of Michael and this weekend's highly anticipated release of The Devil Wears Prada 2. Operator, we'd now like to open up the line for questions. Thank you. The floor is now open for questions. If you would like to ask a question, please press star one on your telephone keypad at this time. A confirmation tone will indicate that your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. Again, that's star one to register a question at this time. Our first question today is coming from Robert Fishman of MoffettNathanson. Please go ahead. Good morning. A couple for you guys. Sean, we've been debating windows for many years now, so just would appreciate your updated thoughts after talking to all the studios at CinemaCon about the value that they see in 45-day windows. Do you expect a return of consistent minimum windows to help improve the overall moviegoing habits and how we should think about the impact to film rental costs would be the first one to start with, please? Sure. Thanks for the question, Robert. You know, as we've kind of talked about before in the past, following all the evolution that's taken place with the theatrical window in both the length and variability over a pretty short period of time following the pandemic, you know, there has been a lot of ongoing discussion between studios and exhibitors as we've been evaluating the impact of that on consumer behavior. Your question on the value they see in 45 days, I think there's recognition that the shortened window has been creating headwinds in full attendance recovery, particularly for smaller titles and more casual moviegoers. I think this is a big step in terms of course-correcting what may have over-indexed in terms of reducing beyond 45 days and now shifting back to that. We see all these announcements as a really positive step forward. I think, again, there's recognition not only by studios but by the wider creative community as well, that this is a necessary step to help sustain long-term industry health. I think the impact of that change still remains to be seen. It's like we have to watch what that does over time. It's not a, you know, a precise science trying to measure how much of that opening weekend attendance has been affected by the window, but we all believe that this will have a meaningful improvement in moving the needle in a further positive direction. It's something we will be watching to improve. As far as film rental rates go, I mean, there's a lot of factors that go into film rental discussions. The short answer is we don't expect it to impact film rental. Again, I view the recent shifts in windows as an important reset in the right direction based on the sizable reductions that may have gone a bit too far over the past few years. You know, while this progress definitely represents significant improvements, even at 45 days, you know, the window is still down approximately 40% from the pre-pandemic norm. And, and those, you know, most of those film scales were, you know, were kind of predicated on an environment that preexisted before the pandemic. We don't expect a material impact as a result. Okay. Thank you. Maybe Melissa, your Movie Club now drives about 30% of your box office. Just wondering, how do we see the demographic breakdown of Movie Club and the frequency of returning to the movies for your members and how that might differ from just regular moviegoers? I know you referenced that the Global Cinema Federation study the success of the younger moviegoing habits, what can Cinemark or the industry do to bring back older moviegoers? Thank you. I'll take that one, Robert. I mean, as far as the profile of our Movie Club members, I would say it largely is consistent with just general demographics of moviegoers on the whole. I think it is a program that is one of the examples that helps not only for younger audiences but older audiences alike. You know, your question on what can we do to bring other audiences back, we continue to see that as we get new members into the program, their moviegoing frequency increases, and that spans all age ranges, which is part of the reason why it's such a valuable program. And you know, guests find tremendous value in it. Not only do they come more, they upgrade more, they buy more food and beverage, and are some of our most satisfied guests. That's one of the things. You know, beyond that, and this goes beyond the Movie Club question, I think it, you know, it extends into the profile of films that are getting released. I think this year is probably one of the most diverse slates we've seen for a while. As more of that content come that appeals to other types of age ranges and that's more sustained, that should help. Our marketing efforts too. I mean, we continue to increase the sophistication of our marketing efforts to really target market different consumer categories and really speak to what is motivating to them. Certain things that may appeal to younger audiences, we'll craft, you know, messages one way and we'll craft them differently for older audiences. There's a range of things like that, but we're thrilled with the Movie Club. We're thrilled with our Movie Club success, and again, it really spans all age brackets. Thank you, Sean. Thanks, Robert. Appreciate the questions. Thank you. Our next question is coming from David Karnovsky of JP Morgan. Please go ahead. All right. Thank you. Maybe, following up on the first question, Sean, wanted to see if kind of post CinemaCon, you see any traction in terms of getting the studios to space out their releases and getting more back to a pre-pandemic pattern. Just kind of noting some of the still kind of large gaps in programming, like in the winter or late summer. Sure. Yeah. It's another great observation, David. It's, it's probably the next piece of the puzzle to continue to make progress on. I think we've seen volume continue to recover, so that's made leaps and bounds from where we were a few years ago. We've obviously just had the recent news on Windows, which we think is great progress there in terms of supporting a healthy theatrical exhibition ecosystem. You know, the other piece is just the cadence of movies, 'cause this does tend to be a momentum business where people go, they have a good time, they see what's coming up, they come back. When there are those gaps that can disrupt that momentum, and then we got to reboot the engine again and again. This year, I'd say we have a little bit of that kind of clumping going on in the summer months and at year-end. I think probably coming out of CinemaCon at least, beyond just talking about it, when we looked at what is currently lined up for first quarter of next year, I think what, at least for now, assuming that the release dates hold, the first quarter looks far more robust than we've seen in prior years, the first quarter of 2027, I mean. We've seen some of that kind of clumping, and we have wished that some of the stuff that's been programmed this summer would have spread earlier in the year. We saw more of that this past CinemaCon, so hopefully that'll continue to stretch out over the full of the year, and that'll be something else that'll be beneficial to the industry. Okay. In the prepared commentary, you spoke to marketing and the residents of some of the direct-to-consumer brand programs. I'm curious if the traction here changes your long-term view at all of, you know, market share gains, per caps or, you know, even other revenue, right? Assuming customers might be kind of more inclined to buy tickets through Cinemark rather than a third party. Just for Melissa, like, given the marketing runs through film rent, I don't know if it's possible to quantify at all some of the added expense you've incurred here. Thanks. Thanks for the question, David. On the marketing front, we have leaned in there. We've stepped up our investment post-pandemic, and we have seen some nice successes there, and our marketing efforts do span across both the admission side as well as the food and beverage side. We do think that we have been seeing benefits there, and our market share, we do believe, is reflective of those benefits. You saw us even in Q1 maintain elevated market share in the quarter, and that was flat year-over-year despite a challenging comp. There are a number of factors that we're doing across our business, so beyond just marketing, that are really driving growth across market share, average ticket prices and our per cap. It's a combination of all of the efforts across marketing, loyalty, our showtime optimization, as well as our investments in our circuit that we've been doing on an ongoing basis. I wouldn't call out 1, you know, area specifically, but we have made significant progress on the marketing side, and I do think you're seeing that in the results. From an investment standpoint going forward, not only have we had a step up since 2019, but as you look at full year 2026, I would expect our marketing as a% of revenue to increase year-over-year just based on the returns that we've been seeing to date. We continuously calibrate that spend as we're monitoring our returns, and adjusting our mix, based on what we're seeing in the data, but feel really good about the progress we've been making there. Thank you. Thanks, David. Thank you. Our next question is coming from Eric Handler of Roth MKM. Please go ahead. Good morning. Thanks for the question. Sean, Cinemark's always prided itself on having a wide range of offerings across premium and, you know, baseline pricing. I'm curious, you know, with this week's Wall Street Journal report, having a competitor charging $55 for IMAX film screenings for Dune 3 in its opening weekend, how do you feel about price sensitivity from consumers, and do you have a $55 ticket presale for Dune 3? Well, the short answer is we don't have that for Dune 3. As far as pricing more broadly, the way we look at it is kinda on the unique profile of each theater, and, you know, expectations of our guests with the kind of overarching objectives of maximizing attendance and box office and food and beverage incidents and total revenue, while at the same time ensuring that our guests perceive strong value in their experience to encourage repeat visitation. You know, through all our pricing team and analytics, we found that that approach has served us well. When you look at our attendance recovery compared to the industry and our growth in concession per caps year-over-year, we think that's really working. To the extent we were to pursue something in that direction, we would do so very cautiously just to gauge the impact it has on guest value perception, as well as visitation frequency, as well as our overall Cinemark brand proposition. That's helpful. Secondly, looking at your concessions line, you know, you've seen really good increases in per cap spending. Merchandise, I'm seeing more and more of in my local Cinemark. I'm curious how much of the lift is driven by merchandise versus sort of the core, you know, food and beverage product? Thanks for the question, Eric. On the per cap side, for domestic per caps, breakdown are 7.5% growth year-over-year. That's largely driven by strategic pricing. That's the majority of it, followed by higher incidents and then a shift in product mix. The product mix this quarter, the favorability there was actually predominantly driven by a shift into larger sizes within our core offerings, so specifically fountain beverages and popcorn. That was actually offset in part by a lower mix of merchandise, and that was really just driven by the film content in the quarter. If you look at the relative mix year-over-year and what lended itself to movie-themed merchandise, we did have a lower mix of merch in the quarter. There are other factors that are driving per cap. Now, as you think about the balance of the year, however, we do expect based on the film slate, that there are meaningful merchandise opportunities ahead of us, and we would expect that to be an increasing part of the mix and a key driver of per cap growth for the balance of the year. I would just add, last year, merch was up about 40% year-over-year. To Melissa's point, we continue to see growth over time. We expect to continue to see further opportunity as it's something that fans continue to embrace, and it continues to enhance just the overall experience and event of coming to our Cinemark theaters. Great. I appreciate it. Thank you. Thanks, Eric. Thank you. Our next question is coming from Mike Hickey of StoneX. Please go ahead. Hey, Sean, Melissa, Chanda. Great quarter, guys. Congratulations. Just two from us. Sean, I guess CinemaCon was pretty exciting this year. Hot Topic was Paramount, Warner Bros.' deal. Obviously, there's an industry view that I think most exhibitors are subscribing to. Just curious with David, his presence at the show seemed to be pretty meaningful, and I know he was, you know, really messaging to all of you, that he's gonna deliver on film volume and committed to that 45-day window. Does that, you think have sort of any impact on your view of the deal or the industry's view of the deal? I guess on the concession side, what do you think is really achievable on a deal that everyone kind of thinks is gonna get through? I have a follow-up. Sorry, could you clarify that last piece of the question, Mike? I missed that. Yeah. Okay ... you know, there's obviously pushback from the industry, and I think there's the view that it's intended to drive some level of concessions in terms of commitments, whether it's film volume or window or marketing. Gotcha just wondering what's actually achievable there in your view? Gotcha. Let me start and then I'll you can tell me if I kind of capture that fully. You know, Paramount's a great partner to exhibition. They've been for many years. It was a nice step that David came out to CinemaCon to kind of speak directly to the wider exhibition community. I think the, you know, the positive thing is they're saying all the right things regarding their future intentions for film volume and windows in a combined company, which is a great start. I'd say that said, you know, us similar, I think, to the wider community, we just like to see those statements backed by firm commitments just to ensure there is, in fact, the follow-through, and that leads to the preservation of a healthy and sustainable theatrical and film ecosystem going forward. I mean, I think that's the big piece, and I may have missed your concessions question. I don't know if I captured it in that, but that's kind of what I think we and the industry at large is really seeking out of this. Okay. I think that works, Sean. The. Thank you. The other is on Netflix. I think, also, you know, Ted showed up, which was great. made a statement, I think, post the deal that obviously didn't go his Netflix's direction. Just curious, your conversations with him or the broader Netflix team, whether it's at CinemaCon or before or after. Yeah ... obviously they gave themselves sort of a, an off-ramp from their prior philosophy on how they view theatrical when they were sort of romancing the Paramount Warner Bros. deal. Now that that's gone, you know, there's still, I guess, the formation of that ramp. Do you see that Netflix is becoming or wants to be a more constructive partner with exhibitors? Obviously, Stranger Things and other one-offs have been successful. Mm-hmm ... I guess the key here is the theatrical window. Do you feel like there's some momentum to move in the right direction? Thank you. Thanks, Mike. I would say it was great to see Netflix and Ted personally take the time and initiative to come to CinemaCon. I think I would characterize the discussions as being productive in opening the door to the possibility of greater collaboration at some point down the road. As you mentioned, they're very pleased with the recent successes they've had in theaters, with their Stranger Things finale and KPop Demon Hunters Sing-Along, and they've certainly expressed the desire to explore more of those types of events as well as possibilities for film releases. I think that's a step in the right direction. While I don't necessarily anticipate any type of material shift on their part in the near term following that meeting, we do continue to believe there's mutual opportunity in partnering together and remain optimistic that they will pursue a more meaningful venture into theatrical distribution over time. Nice. Thank you, guys. Good luck. Thanks, Mike. Thanks, Mike. Thank you. The next question is coming from Drew Crum of B. Riley Securities. Please go ahead. Okay, thanks. Hey, guys. Good morning. Sean, you've highlighted the success of your PLF screen the last few quarters. You know, as you look ahead and continue to invest, is there an optimal mix of PLF screens versus standard screens you see for your circuit? What is the timeframe to achieving that? Sure, Drew. Good question. I think, you know, one of the governors on large screen format and enhanced format screens is just the size of the auditorium and size of the screen. You got more flexibility clearly if you're building a brand-new venue, but with existing theaters, you gotta bear that in mind to make sure that it delivers the appropriate level of enhanced experience. You know, on the whole, we still have about 6% of our screens that are kinda in the PLF category. There's more runway in that with. We've even announced, you know, more XDs and more ScreenXs, and we're adding a couple more, a few more, IMAXs. We've got a range of those things going in. We continue to see opportunity there. The overall, you know, extent to that, I think it is capped again by how many screens we have that can fit the bill of premium large-format. The fact that there's definitely a growing appetite for enhanced formats in theaters by certain categories of moviegoers. What we've seen too is there's also those other moviegoers who don't prefer to pay the upcharge for that. Striking that right balance is important. By and large, if you look at the amount of box office that is generated by PLFs, it's about 15%. If you think about it, 85% of the overall box office in the industry is coming from all those other cinematic screens. It's still relatively small in the whole scheme of things and just gotta kinda bear in mind that right balance from what we're offering in terms of a range of options to consumers as well as how things get marketed in the marketplace. Got it. Okay. Thanks, Sean. Melissa, you know, you highlighted in the deck the, you know, call it marginal 3.5% increase for salaries and wages expense against a much higher attendance figure. You know, as you look at the middle of the P&L and aspire to achieve discipline around spending, what areas do you see where you can achieve or drive further efficiencies? Thanks. Thanks for the question. The key areas that we're focused on from a cost management, obviously across the full expense line items, we're trying to drive efficiencies. Salaries and wages and the concession COGS are really two key areas that we're looking to drive efficiencies out, and we've seen some nice success. You see that both in our salaries and wages rate for the quarter as well as our COGS rate for the quarter. We were, on the labor side, pleased with our disciplined management of labor costs. We aligned staffing levels and operating hours in response to consumer demand. We effectively managed wage rate inflation, and we delivered on our labor productivity initiatives. As you look forward, labor hours and wage rates, those are gonna be the key factors on our salaries and wages. We'll continue to flex our labor hours up or down based on project-projected attendance and operating hours, though not necessarily at the same rate, and we'll try to drive efficiencies within those hours. The one thing I would call out though, Drew, for modeling purposes, for Q2 specifically, we did have a significant overperformance from Minecraft in Q2 of last year, which resulted in fewer labor hours than would typically be expected for that level of attendance. There will be a tougher comp for salaries and wages in Q2 year, on a year-over-year basis. Wage rate inflation, we do expect will remain a factor, but again, we'll continue to look to try to offset some of that with our labor productivity initiatives. On the international side, I would just highlight there, we again continue to look to drive productivity initiatives. What you saw in the quarter in Q1 was wage rate inflation really coming into play, particularly just in the Latin America market. We have seen, which is not unusual, we have seen government-mandated wage increases that have exceeded inflation. That has put some pressure on that line item that we continue to manage and will look to manage going forward. Just a little bit of detail on the COGS side. As you look at some of the things that we're pursuing there, we have been really active on the strategic sourcing front. We had mentioned in our executive commentary that we made changes to our distribution model, allowed us to not only expand our product selection, but also lower our overall product costs, and you're seeing that play through. We've also been consolidating our vendor base to leverage our scale and continue to competitive source our products. Lots of efforts going on there to try to combat the inflation that we've been seeing. Great. Thanks so much. Thanks, Drew. Thank you. The next question is coming from Omar Mejias of Wells Fargo. Please go ahead. Good morning, and thanks for the question. Sean, maybe first on M&A, there's been recent media reports of potential consolidation activity in the space. Without getting into specifics, how are you thinking about your appetite for accretive opportunities right now? When you evaluate deals, are you more interested in circuit level pickups or something larger and more transformative? I'd say one of the areas of focus that we think about as we position ourselves for success going forward is optimizing our footprint. That includes growing and recalibrating and strengthening our circuit as appropriate. M&A is certainly part of that equation. It's very much on the table. I would say with regard to growth via M&A, we do look at all prospective opportunities, and we do tend to target high quality assets that have, we think have solid assured returns over time. We do tend to prefer deepening penetration into the markets where we already have some presence because that leverages our established infrastructure and relationships and knowledge of the market. We also consider other factors, such as scale and strategic importance and competitive positioning and margin profile. There's a range of things that we do look at. You know, ultimately, our goal is to create value for shareholders. As far as kind of tuck-ins versus more transformative M&A, I think it boils down to the deal. I would just pigeonhole us into any 1 area. You know, there's probably more, I think, more inclination to potentially move on some kind of tuck-ins that can move a little bit faster, but it really just boils down to the economics and the prospects for a given deal. That's very helpful. Sean or Melissa, on Latin America, attendance and results were a bit below expectations. Just wanted to get some color on how much of that was just the slate not resonating versus anything you're seeing on the consumer side. With the Q2 slate ahead and the rest of the year, how does the slate look for that Latin American audience? Thanks. Yeah. Thanks for the question, Omar. As it pertains to international in Q1, what you're seeing in our results there is essentially the film content just simply didn't resonate as well in the region in the first quarter. That happens from time to time, and it impacted our margin. That said, our team delivered results that were in line with Latin America benchmark. As you look forward, we do feel really good about the slate for the remainder of this year for Latin America and do believe that it will resonate well with audiences in the region. Titles like Toy Story 5, Spider-Man, Avengers, Minions, and Michael are all anticipated to deliver strong box office results in LatAm. We also have another title from the Insidious saga this year, which typically performs particularly well in the region. There are certain films such as Odyssey or Supergirl, The Cat in the Hat, Dune: Part Three, that might not, you know, index as favorably as they are projected to do in the U.S. market. We also do have local content in the international side. Not a ton of visibility there yet into major contributors, but there's always opportunity for a breakout film. On balance, I would attribute Q1 to really just a film slate that didn't resonate as well with the market. Balance of year, we feel optimistic about this film slate. Great. Thanks, Melissa. Appreciate it. You're welcome. Thanks, Omar. Thank you. Our next question is coming from Chad Beynon of Macquarie. Please go ahead. Hi, good morning. Thanks for taking my question and great to see you all at CinemaCon. Melissa, you've kinda touched on this a little bit throughout the call so far, just in terms of some of the cost items, but, approaching it from a different angle with respect to the Middle East conflict, gas prices, we saw some big fluctuations even this week. How are you thinking about the impact from this, if that continues, either domestically or internationally? Are you starting to see some of your vendors kind of pass through these costs of maybe delivering some of the goods or anything else that goes into the margin? Thanks. Thanks, Chad. On a cost side, we do benefit from contractual structures that provide some protection for rising gas prices, though there are elements of fuel charges in select agreements. To the extent higher fuel costs have an impact, it would most likely show up in our cost of goods sold line item. At this point, though, we wouldn't expect it to be material, and we're not seeing those costs, you know, come through by and large. I would say, you know, not expecting it to be material or have a big impact. Okay, great. Thank you. One of the big takeaways from CinemaCon was around the renewed interest from the Gen Z age group. Outside of just the content that's coming out in the near term, can you just talk about some of the things Cinemark is doing to better attract and retain some of these customers that maybe haven't been as frequent in years past? Thank you. Sure. I think, probably one of the biggest things that we've done recently is at the end of the last year, we launched our first ever Cinemark brand campaign, called It's Showtime. That was very much structured with an eye toward younger moviegoers, you know, to have more showcasing kind of the freshness and the fun of moviegoing, and in particular at Cinemark. It definitely was through that lens, and we're using that strategically as part of our overall marketing efforts going forward to try to speak to that audience. You know, along those lines too, you know, clearly one of the things that we've done in our different social media efforts is we're using a lot of influencers through our in our process, which resonates with that audience in particular. That's a big piece of it. Then just the way we kind of put our different kind of media spots out there. You know, there's different things that we're doing with an eye to that. You know, we mentioned in our executive commentary how also with our emails, we're sending out unique calibrated emails that are personalized based on attributes of our guests, and people who are in our, you know, network of direct communication. All those kinds of things are just examples of how we're calibrating different ways of speaking to those audiences, and then when they're in our theaters, making sure we're offering them the types of things that appeal to them, whether that's food and beverage. That is a category of audience that these premium amenities are resonating with. As we continue to roll those out, our motion seats, our large screen formats, our ScreenX, like things like that, all speak to that audience and are working really well. All those things come together to kinda really help with as well as the film content in attracting that audience is more and more. Thanks, Sean. Appreciate it. Thanks, Chad. Thank you. Our next question is coming from Patrick Sholl of Barrington Research. Please go ahead. Hi. Good morning. Maybe following up on an earlier question. Do you have any sense on the extent of the audience that with the shortened windows was staying home, or is that kind of just harder to tease out? It's difficult to fully pierce that out. One thing we've seen is the week-to-week patterns of a film's release have held relatively consistent to pre-pandemic characteristics. In that regard, that's been a positive. That overall opening that then plays through that pattern is where the challenge has been. It's, you know, like I said, we've seen the effect of that across all categories of moviegoers, particularly pronounced in more casual moviegoers who come only, you know, once or twice a year, as well as on smaller films. Those are some areas of the audience that have perhaps been a bit more pronounced, it's kind of cut across the board. The hard part is, like, you know, we know there's a big gap that's been unexplained in terms of attendance recovery. When you kinda start to go through all the different pieces of what it could be, everything points to windows, which is why we're so encouraged by these recent changes, but kinda singling out a specific area of audience is difficult to do. Okay. Then just on the concession side, could you maybe talk about, like the, I guess, the breadth of the wide release slate that you offer merchandise for and, like, how you would expect that to sort of trend, you know, as film volume increases? Maybe just the overall contribution from that side of the concession spending area. Sure. I'll start on that, and you can let us know if we kinda captured what you're asking. You know, as Melissa referenced, merchandise, which has certainly been growing in appeal and has not only represented a revenue opportunity but helped to eventize going to the cinema, you know, even kinda the talent and the films have gotten into the promotional vehicle of that. It is largely tethered to film content. We do sell a range of other things, like we'll sell Cinemark blankets, and we sell Cinemark things. We sell, you know, kinda nostalgia-type T-shirts and things like that. You know, the big drivers of what's causing the growth are the new releases. It kinda boils down to what. It's the situation that Melissa was describing for first quarter, where last year, the films that released lent themselves a bit more to merchandise compared to the first quarter this year. As we look over the course of the balance of this year, it's quite robust in terms of the opportunities that we see for merchandise. It's something we're leaning into more and more. We do expect that to continue going forward. I mean, when with the materials we saw at CinemaCon and just the general trends of what studios are investing their production into, majority of that lends itself well to merchandise. You know, clearly there's the main, the big tentpole blockbuster films, but then you'll get different types of categories too that things can resonate, which sometimes, you know, can kinda surprisingly be really robust. Okay. Thank you. Thanks, Pat. Thank you. Our next question is coming from Stephen Laszczyk of Goldman Sachs. Please go ahead. Hey, great. Thanks for taking the questions. Sean, I wanted to get your latest sense and see if you could talk a little bit more about what you're seeing out there on the competitive front in the markets you're operating in. Specifically within those marketplaces, I'd be curious how what you're seeing is maybe influencing some of the decisions you're making around things like marketing, the pricing at a market-to-market level than some of the strategic investments you're making on the CapEx side. Sure. I mean, look, I'd say, the competitive environment, if anything, continues to get stronger, which isn't necessarily a bad thing. I think, this is the type of industry where, in certain circumstances, all boats rise and fall together. To the extent, our peers in the industry are delivering consumers a really positive moviegoing experience, that tends to bode well for the impression of the industry as a whole. As others are leaning into premium amenities as well, and ideally enriching the overall experiences they're providing for guests, that's a good thing. We're certainly seeing more of that. We're seeing others step up their marketing efforts, to attract people to their venues, as well as to just help build awareness for upcoming films. All that works well. I would say we feel we're in an advantaged position because of all the work we've done for the past several years. We've got a big head start on that. It's part of what resonates in our market share results, in our attendance results, in our overall performance results. We obviously haven't stopped. We continue to further advance what we're doing. There's just a long road of initiatives that we're pursuing to take our programming, our marketing, our pricing, our scheduling, everything to the next level. For us, it's just a matter of, okay, how do we keep that lead and ideally continue to gain it even as competition continues to strengthen. Great. Thanks for that. Maybe just a follow-up for Melissa. Just wanted to see if you could unpack with any more detail the drivers around utilities and other and SG&A expense increases in the first quarter. Then just as we think ahead to the balance of the year, how we should be thinking about modeling those line items across the rest of the quarters. Thank you. Sure. From a utilities and other standpoint, that was up primarily driven by the increase in attendance, as many of those costs are variable or semi-variable in nature. Credit card fees, janitorial, repairs and maintenance, electricity costs. You will see that uptick happen, and it is primarily attendance-related in the quarter. And as you think forward for utilities and other, there's a couple of things that I would call out outside of, you know, the variable and semi-variable nature of our expenses. I mean, we do expect those to scale with the anticipated growth in attendance that we're expecting for the balance of the year. From a rate perspective, I would just call out that we do continue to expect electricity costs to be higher, just reflective of market rates. That's more at a macro level dynamic that we're seeing. On the repairs and maintenance side, just as a reminder there that we do expect our repairs and maintenance to remain elevated as we continue to address deferred maintenance needs across the circuit, though we don't expect that to have a meaningful year-over-year impact because we started those efforts last year. However, there could be some timing kind of quarterly within the year there. Other factors, we do have fixed costs like property insurance and real estate taxes, that those would be subject to the broader insurance market and changes in property values. We continue to focus on disciplined management within that line item, and in particular, you know, usage as it comes to electricity costs and the pressure we're seeing there. From a general and administrative expenses, on the G&A side, for the quarter, what you're seeing there, primarily excluding stock-based compensation, G&A was up about 2% globally, and that's driven by wage and benefit inflation and some targeted investments in headcount, and capabilities, including our ongoing shift in cloud-based software to support our strategic initiatives. Those impacts were partially offset by lower professional fees. As you think about the go forward, we do expect to continue to have an impact from merit increases and some investments that we're making in talent and capabilities. We do expect variability in the areas of professional fees and incentive comp may somewhat offset those increases. We'll again continue to be disciplined on the expense side within G&A line item as well. You know, there's puts and takes. However, we're not expecting, you know, meaningful increases there. Great. Thank you very much. Thanks, Stephen. Thank you. Thank you. Our next question is coming from Eric Wold of Texas Capital. Please go ahead. Thanks. Good morning, guys. Maybe just want to take that last question on individual expenses maybe to a higher, broader level. I guess knowing that recovery in attendance and box office and associated concession spending are the biggest drivers to pushing your margins higher and back towards pre-pandemic levels, ex obviously DCIP and the other things that were back then. Just wanna get a high-level sense of, you know, where do you see margin leverage this year on that kind of revenue growth as we get back towards a, you know, a $10 billion, you know, box office environment given, you know, all the labor, utilities, inflationary headwinds that may be pushing back on that versus, you know, maybe what you may see in a more optimal recovery environment? Thanks for the question, Eric. Where we expect to gain the most leverage is going to be against our fixed expenses. That's going to be in the U.S. side, our facilities, lease expense, primarily being fixed in the U.S., as well as our G&A expenses. Those are kind of primary areas that we expect to get leverage. Beyond that, you know, we've talked about some of the different expense impacts across the P&L, but I would kind of step back and take a look at overall margin profile and what we have been able to deliver. 'Cause we've been seeing inflationary pressures across these various expense categories for some time, but we've still been able to deliver really strong margins because of the offsets we've been able to provide, but also the top line growth that we've been able to deliver from a food and beverage per cap, average ticket standpoint, or average ticket price standpoint, as well as, you know, maintaining our market share gains relative to pre-pandemic. We'll continue to, you know, focus on growing the top line, and that will give us leverage, as well as trying to mitigate expense pressures that we see. Overarchingly, you know, we do expect the box office and attendance levels to improve year-over-year, which does support margin expansion. We'll continue to focus from an execution standpoint on gaining the most leverage that we can out of that growth. Helpful. Thank you, Melissa. Thank you. Thank you. At this time, I'd like to turn the floor back over to Mr. Gamble for closing comments. Okay. Thank you, Donna, and thank you all for joining us this morning. We appreciate you taking the time to participate today, and we look forward to reconnecting in a few months to share and discuss our second quarter of 2026 results. I hope you all have a wonderful weekend. Thanks. Ladies and gentlemen, thank you for your participation. This concludes today's event. You may disconnect your lines or log off the webcast at this time, and enjoy the rest of your day.