Greetings, ladies and gentlemen, and welcome to the Floor & Decor Holdings first quarter of 2023 conference call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star then zero on his telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to Mr. Wayne Hood, Vice President of Investor Relations. Thank you, operator. Good afternoon, everyone. Welcome to Floor & Decor's fiscal 23 first quarter earnings conference call. Joining me on our call today are Tom Taylor, Chief Executive Officer, Trevor Lang, President, and Bryan Langley, Executive Vice President and Chief Financial Officer. Before we start, I want to remind everyone of the company's safe harbor language. Comments made during this conference call and webcast contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are subject to risk and uncertainties. Any statement that refers to expectations, projections, or other characterizations of future events, including financial projections or future market conditions, is a forward-looking statement. The Company's actual future results could differ materially from those expressed in such forward-looking statements for any reason, including those listed in its SEC filings. Floor & Decor assumes no obligation to update any such forward-looking statements. Please also note that past performance or market information is not a guarantee of future results. During this conference call, the company will discuss Non-GAAP financial measures as defined by SEC Regulation G. We believe Non-GAAP disclosures enable investors to better understand our core operating performance on a comparable basis between periods. A reconciliation of each of these Non-GAAP measures to the most directly comparable GAAP financial measure can be found in the earnings press release, which is available on our investor relations website at ir.flooranddecor.com. A recorded replay of this call and related materials will be available on our investor relations website. Let me now turn the call over to Tom. Thank you, Wayne Hood, everyone for joining us on our fiscal 2023 first quarter earnings conference call. During today's call, Trevor Lang and I will discuss some of our fiscal 2023 first quarter earnings highlights. Bryan Langley will provide a more in-depth review of our first quarter performance and share our thoughts about the remainder of fiscal 2023. In the first quarter of fiscal 2023, we delivered diluted earnings per share of $0.66, in line with our expectations and flat versus the previous year. We take pride in these earnings results as we believe they demonstrate the continued strong execution of our key long-term growth strategies and our remarkable agility in adapting to significant year-over-year declines in existing home sales amidst the broader macroeconomic challenges we continue to face in 2023. As we look forward, we expect existing home sales to remain challenging in 2023 and customers to increasingly prioritize value and savings, seeking out those retailers that best meet these needs. We believe we are well-positioned to navigate these headwinds and grow our market share even as the flooring industry contracts in 2023. Because we source our products from 24 countries and over 240 suppliers, we are able to deliver low product prices and compelling value options across a broad range of products. Our broad assortments feature an exceptional range of price points and features and benefits for consumers looking to install any hard surface flooring. Furthermore, we are building on our value proposition in 2023 by passing along some favorable supply chain costs to our customers by selectively lowering prices on specific SKUs. We intend to maintain or widen our product price gaps with our competition and are monitoring unit price elasticity to enable us to drive incremental growth. We have introduced new lower price signage in our stores and website, further reinforcing our strong value message. Additionally, we are leading with compelling value options at the front of our stores and on our merchandising end caps. While maintaining our price leadership position, we are also focused on winning by driving newness and innovation through exciting new programs and initiatives in 2023. Finally, we are intently focused on driving further engagement with our homeowner and pro customers in 2023. Before I turn the call over to Trevor, I would like to say how inspiring it was to see our store managers leave our March annual meeting excited about developing market-specific plans to grow their market share in this challenging period and embrace the new store growth opportunities ahead of us. Let me now turn the call to Trevor to discuss our first quarter sales and growth pillars. Thanks, Tom. We are incredibly pleased with the energy in our stores and how they are executing our strategies to grow our market share during this challenging macroeconomic period. We are further emphasizing our everyday low prices, trend forward assortments of in-stock job lot quantities, and leading customer service provided by our store associates. We have made significant investments in our associate training and wages over the past few years, leading to improved customer service, an essential attribute in this challenging period. We are not playing catch up with associate wages and are pleased these investments are paying off. For each of the last two quarters, we have seen a year-over-year improvement in turnover. Our fiscal 2023 first quarter key customer Net Promoter Score increased by approximately 500 basis points from the first quarter of 2022. We are delighted to see that associate helpfulness ranked the highest among customer satisfaction attributes. Recently, it was announced by Yelp that Floor & Decor was the top-ranked non-food retailer by customers and their most loved brands ranking. Having knowledgeable store associates is extremely important in the customer flooring purchase journey, ranking above low prices, and we are proud to be leading the competition on this important attribute. In 2023, our store managers are focused on having the best sales associates on the floor at the right time to drive conversion, engaging with homeowners as well as our pros. We've also made important improvements for our stores to better follow up on our quotes to drive better conversion. We are finding ways to manage our non-customer facing expenses better and tactically manage our payroll hours without sacrificing our customer service. Let me now turn my comments to our fiscal 2023 first quarter total sales. Total first quarter sales increased 9.1% to $1.1 billion. Comparable store sales declined 3.3% from the same period last year, which was in line with our expectations. Comparable store sales declined 0.1% in January, -3.7% in February, and -5.2% in March. We estimate Hurricane Ian positively impacted our first quarter comparable store sales growth by about 100 basis points, similar to the fourth quarter of fiscal 2022. Our fiscal 2023 second quarter to date comparable store sales are down 6.2% from the same period last year. Turning to our 2023 first quarter transactions and average ticket performance. Comparable store transactions declined 9.9% from last year, in line with our expectations and an improvement from our 10.4% decline in the fourth quarter of fiscal 2022. Our 2023 first quarter average ticket growth sequentially decelerated to 7.3% from 14.4% in the fourth quarter of fiscal 2022. The sequential decelerating growth is due to customers purchasing less square footage and strategically lowering product prices. We continue to see ongoing customer preferences toward our better and best price point products where we offer industry-leading innovation, trends, and styles at low prices. We see our consumers transacting less often and purchasing less square footage. When considering flooring, they prefer our higher margins, better and best price point merchandise offerings. I will now discuss our new store pillar of growth. In the 1st quarter of fiscal 2023, we opened 3 new warehouse format stores, bringing our total to 194 warehouse stores across 36 states. During the quarter, we closed our original design studio in New Orleans as the lease expired, and it did not align with our current prototype, leaving us with five design studios. As we plan for the 2nd quarter of 2023, we are excited about achieving another milestone in our company's history with the opening of our Metairie, Louisiana store in May, which will be our 200th warehouse store we have opened in our history. Addition to opening Metairie, we intend to open eight additional warehouse stores in the second quarter, including three new markets: Temple, Texas, Huntsville, Alabama, and Grand Rapids, Michigan. We will also expand our presence in the greater Washington, D.C. market with an opening in Aspen Hill, Maryland. Furthermore, we will continue our expansion in Florida by opening two warehouse stores in Orlando and 1 in Fort Myers. These openings are part of our goal of opening 32-35 warehouse stores in 2023. As discussed in the last earnings call, most of our 2023 new warehouse store openings are expected to be in existing markets and weighted to the second half of the year. We have considered potential construction delays by weighting the openings to the second half of 2023. Looking beyond 2023, we expect construction delays to ease and anticipate a more balanced quarterly store opening cadence that will lead to more warehouse store operating weeks. Turning to our pro business. Our fiscal 2023 1st quarter total sales to pros increased 19.1% and accounted for 42.1% of our sales, an increase of 385 basis points from last year. Pro comparable store sales increased 6.9% from last year, driven by a 6.1% growth in average ticket and a 0.7% increase in transactions. We continue to grow our pro contacts and are excited about refinements we are making in our customer relationship management, or CRM, dashboard tools that will further allow us to optimize and enhance our lead capabilities and drive engagement. We are pleased that our pros continue demonstrating a strong appreciation for the value of our industry-leading PRO Premier Loyalty program, or PPR, as first quarter redemptions grew 95% from last year. We seek to build sticky relationships and lifetime value with pros through education and training about flooring products, installation, and design solutions. We aim to be the premier destination for pro education by expanding our industry partnerships. In the first quarter of 2023, we hosted 27 educational workshop training over 680 PROs. For the year, we have 121 PRO educational workshop events planned compared to 71 in 2022. These investments are working as those trained PROs in the first quarter significantly increased their spending with us from last year. Turning to our e-commerce business. Our fiscal 2023 first quarter e-commerce sales increased 10.2% from last year and accounted for 18% of our sales, compared with 17.7% in the previous year. In 2023, our e-commerce team is focused on executing strategies aimed at optimizing our customers' digital experience towards further improving conversion. We are improving our price filtering experience and are executing a stronger value message on our website to reflect the current economic challenges. We have added new low price banners to certain SKUs that further express our unbeatable prices and unmatched selection, reinforcing our value proposition. We continue to be focused on current trends, adding inspirational and user-generated content, and expanding into new categories by recently extending our outdoor category with pool options. We are emphasizing accelerating our webpage load speed. Improving webpage load speed has several benefits, including better user experiences, higher engagement, lower bounce rates, higher customer satisfaction scores, better search rankings, and an improved mobile experience. On to our design services. We aim to continue strengthening our competitive moat through a well-executed in-store and developing in-home design services offerings. In 1st quarter 2023, design sales increased substantially from last year. We now have over 930 designers working in our stores, with plans to have over 1,000 designers by the end of the year. As discussed in prior calls, we see higher customer service scores, average tickets, basket selling, installation materials, adjacent category sales, and gross margins when they are involved. In 2023, we are focused on improving and measuring designer productivity by leveraging our CRM tools, systems, technology, and follow-up processes to elevate the sales experience further to maximize conversion. Moving to our commercial flooring business, which includes Spartan Services and our Regional Account Managers, or RAMs, which work with our stores. We continue to be pleased with our sales and earnings growth at Spartan Services and our RAMs. We believe their strong first quarter and trailing twelve-month sales and earning results further affirm that our strategies to grow our commercial market share are working. Spartan's fiscal 2023 first quarter sales increased by 31.7% from the first quarter of 2022, and EBIT increased by 73.5%, primarily due to better than expected increases in the gross margin rate. We are encouraged about the remainder of 2023 as Spartan's new quoted project trends, a key leading indicator, shows consistent growth. Additionally, we are excited about continuing our rapid growth of our organic and inorganic rep additions across the United States towards achieving a national footprint. We ended the first quarter of fiscal 2023 with approximately 65 Spartan reps. We are particularly pleased with the commercial order productivity of our more mature reps, and our acquired rep groups are outperforming our pro formas. Our RAM's fiscal 2023 first quarter sales meaningfully exceeded our expectations, increasing 70% from the first quarter of 2022. We ended the first quarter of fiscal 2023 with approximately 50 RAMs. As discussed in prior earnings calls, we remain excited about the commercial market opportunity and our strategies. Finally, we are operating from a position of strength and are excited about the opportunity to continue to grow our market share in fiscal 2023 and beyond. We have demonstrated that we have the right teams, strategies, and an agile business model, which we believe will allow us to continue to successfully navigate the challenging macroeconomic environment. I will now turn the call over to Bryan to discuss our fiscal 2023 first quarter financial results in more detail and share our outlook for the remainder of the year. Thank you, Tom and Trevor. Our first quarter financial performance is once again a testament to the strength of our business model. Despite the significant year-over-year declines in existing home sales and their adverse impact on our business, we were able to effectively manage our profitability by successfully executing our gross margin rate recapture plans and manage our expenses efficiently. As a result, we delivered 2023 first quarter diluted earnings per share of $0.66, in line with our expectations and flat to 2022. Let me now turn my discussion to some changes among the significant line items in our first quarter income statement, balance sheet, and statement of cash flows. I will discuss our outlook for the remainder of the year. We are pleased that our fiscal 2023 first quarter gross margin rate increased 210 basis points to 41.8%, primarily from our decision to raise retail prices last year to offset higher supply chain and product costs. These results increase our confidence in achieving our 2023 gross margin exit rate target of 42%. As a reminder, we are now able to selectively lower retail prices while simultaneously recapturing gross margin rate as lower supply chain costs move through our income statement in fiscal 2023. We expect this to result in a substantial year-over-year increase in gross margin rate in fiscal 2023, with most of the expansion in the first half of fiscal 2023. Our fiscal 2023 first quarter selling and store operating expenses increased to $303.7 million or 21.7% from the same period last year. As a percentage of sales, selling and store operating expenses increased 280 basis points to 27.1% compared to last year, in line with our expectations. The cost increase was primarily attributable to 28 additional warehouse stores operating since March 31st, 2022. Wage rate increases, higher credit card transaction processing fees, and deleveraging occupancy and other fixed costs resulting from 3.3% decline in comparable store sales. We expect our annual selling and store operating expenses to approximate 27% of sales, unchanged from our prior guidance. Our fiscal 2023 first quarter general and administrative expenses increased to $61.9 million or 13.3% from the same period last year. The increase is due to investments we are making to support our store growth, including increased store support staff, higher depreciation related to technology and other store support center investments, and operating expenses related to our Spartan subsidiary. As a percentage of sales, general and administrative expenses increased 20 basis points to 5.5% from 5.3% last year. Primarily from deleverage caused by lower year-over-year comparable store sales. Pre-opening expense s of $8.0 million decreased 19.3% from the same period last year. The decrease is primarily the result of fewer new store openings compared to the prior year period. First quarter net interest expense increased to $4.9 million from $1.2 million in the same period last year. The $3.7 million increase in interest expense is in line with our expectations and is primarily due to an increase in borrowings under our ABL facility and interest rate increases, partially offset by increases in capitalized interest. Income tax expense was $19.1 million compared to $21.9 million in the same period last year. Our first quarter effective tax rate declined 250 basis points to 21.1% from 23.6% in the same period last year. The decrease in the effective tax rate was primarily due to year-over-year increases in excess tax benefits related to stock-based compensation awards. Excluding the impact of excess tax benefits, our first quarter tax rate was approximately 24.6% compared to 24.4% in the same period last year. Let me now turn my comments to our profitability. Our first quarter net income increased 0.8% to $71.5 million, and diluted earnings per share of $0.66 was flat compared to last year and in line with our expectations. We ended the first quarter with 107.7 million diluted weighted average shares outstanding compared with 107.5 million last year. Our Adjusted EBITDA increased 10.2% to $149.6 million from the same period last year. Our first quarter Adjusted EBITDA margin increased to 13.3% from 13.2% last year. A complete reconciliation of net income to Adjusted EBITDA can be found in today's earnings press release. Moving on to our balance sheet and cash flow. We are pleased that our first quarter total inventory decreased 8.6% from December 2022 to $1.2 billion, in line with our expectations. The decline in total inventory and other working capital initiatives enabled us to report first quarter cash flow from operations of $250.3 million, a $253.6 million positive swing in year-over-year operating cash flow. We expect working capital improvement for the full year as we anticipate inventory to grow at a slower rate than sales and from the benefit of expanded AP days. We ended the first quarter with $665.2 million of unrestricted liquidity, consisting of $5 million in cash and cash equivalents, and $660.2 million of available for borrowing under the ABL facility. Let me turn my comments to how we are thinking about the macroeconomic environment in the remainder of 2023. The long-term secular trends that underpin growth in home improvement spending in our 500-store opportunity in the U.S. remain as relevant as ever. We are pleased to be able to make investments even during a declining housing cycle to extend our competitive moat with the intent of growing our market share and being even stronger as the housing cycle turns. The well-established factors supporting long-term home improvement spending include a historically low inventory of new and existing homes for sale, an aging housing stock where over 80% of homes are 20+ years old and require investment and repair, and significant home equity. As more millennials enter their prime home buying years, we are well-positioned to capitalize on this growing market. In the short run, the Federal Reserve continues to be on a path of expeditiously raising interest rates, shrinking its balance sheet, and tightening financial conditions to bring our inflation under control to fulfill its price stability goal. The effect of these policy changes has led to significant declines in year-over-year existing home sales, moderating home price appreciation and home equity values, and slowing growth in spending that is outside of our control. That said, we are encouraged by moderating year-over-year declines in existing home sales that emerged in February and March, but we recognize that two months is not a trend and there remain headwinds as we move through the remainder of the year. Taking these headwinds into consideration and their potential impact on our business, we continue to expect our annual 2023 comparable store sales growth to be within the range of flat to down 3% and diluted earnings per share to be in the range of $2.55-$2.85, unchanged from our prior guidance. However, achieving the high end of this sales and earnings range could be more challenging from further pressure on existing home sales, a deeper than expected economic recession, or a prolonged shift in spending from durables to services that further slows demand. It is still early in the year, we want to be prudent in assessing potential sales and earnings outcomes in fiscal 2023. As a reminder, the earnings flow-through impact from a one percentage point change in comparable store sales approximates $0.10 per share for the full year and approximately $0.08 for each comp point for the remaining three quarters of the year. Let me provide some additional context about how we were thinking about the remainder of the year. We expect our fiscal 2023 second quarter comparable store sales to sequentially decline and to potentially represent the largest decline of the year before returning to growth in the fourth quarter of fiscal 2023. Similarly, we expect second quarter earnings to represent trough earnings and to be slightly lower than the first quarter before sequentially improving in the second half of the year, primarily in the fourth quarter. Our expectations contemplate continued declines in comparable store transactions. In the first half of 2023, before returning to growth in the second half of the year, primarily in the fourth quarter. As a reminder, we start to cycle past high single digit declines in transactions in the second and third quarters of fiscal 2023, before comparing against a 10.4% decline in the fourth quarter of 2022. The strategic price reductions we are making to improve our transactions and grow our market share in a contracting industry is expected to lead to a slight decline in our average ticket in the second half of the year, but we believe will improve our transaction trends as we move through the year. Let me now turn the call back to Tom. Thanks, Bryan. In closing, we believe our ability to continue to make strategic investments in a year marked by a contraction in the industry growth will enable us to accelerate our market share in 2023 and beyond, particularly among pros. As a reminder, we increased our market share by 200 basis points to approximately 10% in 2022, and we are thrilled that the early first quarter 2023 market share data points to another strong year. We expect 2023 could be particularly difficult for independents to manage pricing, inventory, and marketing during a contracting sales period when compared to our larger scale direct sourcing business model. We remain committed to investing in our associates, opening 32-35 new warehouse format stores, remodeling existing stores, and enhancing our technology and e-commerce platform to improve the customer experience. While 2023 will be a challenging year, we are intent on further widening our competitive moat, managing our profitability, and laying the foundation for accelerated earnings growth into 2024 and beyond. In closing, we owe our success to our associates' hard work and dedication, who serve our customers with excellence every day. Operator, we would now like to take questions. Thank you very much, sir. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star and then one on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star two to leave the question queue. We ask that you limit your questions to one and one follow-up. For participants making use of speaker equipment, it may be necessary to pick up your handset before pressing the star keys. The first question comes from Steven Zaccone of Citi. Good afternoon. Thanks for taking my question. Brian, I wanted to follow up on the same-store sales guidance for the balance of the year. Thanks for the detail on the cadence, but specifically on the second quarter, when you say the largest decline, should we assume this quarter to date trend kinda holds and you'll probably be in a, you know, down mid-single digit range? If that's the case, how do you see the building blocks to achieve the high end of the full year range? Just seems to have been a pretty big acceleration in the back half. How do we think through that? Yep, no, thanks for the question. Look, I think you kinda nailed it a little bit there. As we think about it, Q2 will be down. I think the way that we don't really give the quarterly guidance, but we said that that will be the largest decline. We do think it should get slightly better from where it is today as you think about it. As we think about the second half, we'll expect sequential improvement with growth in the fourth quarter. Obviously, to achieve the high end, you'd have to have, you know, a decent amount of growth in that fourth quarter to offset the three-three that we had in Q1. Where we are today should see slight improvement from there, as it grows throughout the fourth quarter. There's a couple of things there. Transactions are in line with that. Transactions are expected to be in the high single digits negative for the first half, and then sequentially improve to growth in the fourth quarter as well. There's a couple of reasons why. One, we're against easier compares. Remember, Q2 and Q3 were high single digit declines in 2022, and then Q4 was down 10.4%. Part of the story is what we're lapping against. We also expect transaction improvements from the pricing actions that we've taken. Third, we also expect sequential improvement in existing home sales throughout the year, as seen in both February and March, they're up from that trough of 4 million units. We think as that continues to improve throughout the year. Just think about the assumptions embedded within our plan. We've got existing home sales sequentially improving, from the lower mortgage rates off a peak of 7% in October of 2022. As I just mentioned, you know, we're encouraged, by what we've seen in February and March and the improvement in existing home sales. Great. That's helpful. I mean, just to follow up on the April deceleration, it doesn't seem that big from March, but it's still a step down, and I think people are trying to grapple with how much is, you know, weather and other data points out there on the consumer. Is there anything you're seeing in the month of April that's a notable change in trend, whether it's pro or DIY or just traffic trends? It'd be helpful to get some color. This is Tom. I'll start, if Trevor Lang wanna add, feel free. I think the only thing with April that's a little bit tricky is Easter fell in April, spring break was in April. As we've experienced coming out of COVID, holiday weeks have had a lot more travel in it, a lot more consumer spend going to leisure and entertainment than before. I think that's part of April. We've seen a little bit of improvement in the month of May, so we're encouraged by that. You know, I think more than anything, weather doesn't impact us all that much. It may shift business a little bit. There was some adverse weather, but, I believe it ties much more into, how the consumer spent their time and their money during the month of April. Okay, thanks for all the detail. Thank you. The next question comes from Zachary Fadem of Wells Fargo. Hey, good afternoon. Could you talk to the performance of your mature store comps in the quarter relative to the newer stores in the comp base, and maybe help us bridge the gap between the two, along with the impact of cannibalization to get to your down 3 comp? Is there any reason to believe that the new store maturity curves for, you know, for the newer stores in the comp base could change in this tougher backdrop? I'll answer the last part first, Zachary Fadem. I don't think it's gonna change the actual curve itself. I think what you're doing is you're starting with just a little bit lower of a base, is the way that I would think about the new stores. We're seeing significant growth in those the same way we have. You know, we start at 60% productivity and work our way up through the first five years, kinda getting to the mature base. Up to 3-3, I don't think there's any disproportionate amount of gap between what we've seen historically from the mature performance versus our kinda new store ramp up there. I think cannibalization was slightly higher. We never really give that number, it was just slightly higher in Q1, just due to the 13 stores that we opened in Q4. I do think you saw a little bit more of an impact there, but nothing really to call out. The additional color you provided on the comp and EPS cadence from Q2 to Q4, could you talk about specifically what you're seeing in the business or the macro today to suggest that Q2 will be the trough? Given that you didn't provide the cadence initially, could you talk about what's changed here versus your initial expectations provided a quarter ago? Yeah. I mean, look, we were in line in Q1. I don't know that a lot has really changed other than Q2. I mean, look, we talked about existing home sales, right? That's our highest correlated metric. Again, we've seen improvement in February and both March, we know there's a bit of a lag there. As we think about the back half, gives us a little bit more confidence in what we see today. We were at $4 million, then I think it went to 4.7 million and back down to 4.4 million. Both February and March were above kind of that $4 million trough that we saw exiting Q4 and into January. I think that gives us a little bit more conviction about where we'll be in the back half and that growth that we're expecting to get. Just where we see it today, we think Q2 kind of will be the trough. I don't know if you guys have anything to add to that. Does that make sense, Zach, or anything else? All good. Appreciate the time. Yes, sir. Thank you. The next question comes from Simeon Gutman of Morgan Stanley. Good afternoon, everyone. The quarter to date stepped down, and apologies to harp on this. It sounded the way Tom described it were transactions if people were, you know, taking time off, et cetera. Are you also seeing a further step down in footage purchased? That's my first question. A little bit of both. We have seen square footage slow from what it's been historically. It's much more, it's much more the foot traffic problem during the month of April. As I said, April, you know, I told you what I think my reasons are around April, and we're seeing some improvement as we get to the month of May. I think this is Trevor. Yeah, one thing just worth mentioning as we forecast the business, you know, we do it at a fairly granular level. We take the current trends that we're seeing in the business, and then, you know, we make an assumption on what's gonna happen for the rest of the year. As we said, we expect existing home sales to, you know, as we exit the year, hopefully get close to 4.7, 4.8, maybe 4.9. We think the combination of the fact that we're going up against easier comparisons as well as the macro getting better, that's gonna be the driver. I mean, you know, the Fed seems like they're gonna be pausing rates. Most of the banks that we've talked to see mortgage rates, you know, getting certainly below 6%. Some have them being as low as 5%. I think the combination of our current trends, plus what we're seeing in the macro is what gives us some confidence, going up against easier comparisons that our business will continue to accelerate. You know, we're five weeks into the quarter, that doesn't make the whole year, but we're doing really well against that forecast. Quick follow-up on gross margin. You're getting pretty close to that 42 already. I think it was said it'll be up substantially in the first half. If freight comes down, it feels like you kinda pass that 42 mark. I think that's been asked prior. Then I was maybe a little confused. It sounded like you're investing in price, but you're content with gaps. Are you actually maintaining price gaps or are you widening them? Yeah. This is Tom. I'll go first. Yes, we're pleased with our margin recapture. We did that, or we've been accomplishing that while taking price at the same time. Supply chain costs continue to come down. Our team's done an excellent job in managing that. We're passing some along. We like the optionality. I mean, we're gonna continue to watch what happens to the elasticity of the SKUs as we adjust price and monitor that. If we see that that's gonna be beneficial to transactions or if we're gonna get more square footage, then we'll be a little more aggressive. It's possible that we could keep a lot of that margin and our margin rates would exit higher than we anticipated. Hey, Simeon, on the other question. Yeah, I mean, we watch our prices versus the competition very closely, and we feel great about where our pricing is versus the competition. You know, our merchants have done a fantastic job on some of these price reductions, being very thoughtful about, you know, where in the assortment we can make those improvements. It's early, but as Tom mentioned, the elasticity that we're seeing is encouraging. As those supply chain costs continue to come down, which we expect that it will, you know, we'll balance that goal of growing the gross margin, but also making strategic investments in price that we think will drive incremental volume. it gives us optionality to manage P&L too, because changing collections through payroll and other things like that, you know, gross margin is that lever that we have. it's good to have that optionality. Thank you. The next question comes from Steven Forbes of Guggenheim Partners. Good afternoon, Tom, Trevor, Bryan. I wanted to start with homeowner trends. I think it was Trevor who gave us the breakdown of pro comps by ticket first transaction. I was wondering if you could do that for homeowner and DIY, and then just comment on how you sort of expect the strategic price investments to impact trends within the homeowner base into the back half here. Yeah, I don't know if we have the homeowner trends at our fingertips, but obviously they're below where the PRO is. Then on the expectation, I mean, the pricing we feel like we invested it in areas that matter the most and where we're gonna have the biggest impact. Some of those SKUs include SKUs that really matter to the PROs. Again, I think we've been, you know, strategic on where we're gonna take those price reductions. Just to reiterate for the last time, the earlier reads on elasticity are positive. Yeah. The math goes in. You can't just add the two together. I mean, our segmentations are either pro or homeowner. If we were down 3%, and we know we were up 6%-7% in pro, you can just literally do the inverse. It'd be down about 10% roughly on the homeowner side. I think the price, you know, as we look at pricing is where we've adjusted it. It hasn't been all that much, but where we have, it is gonna benefit. You know, you think the pro who's in our store, you know, much more frequently, they'll see it, and we want them to see it, and we think it'll benefit them. Then maybe just a quick follow-up on the PRO. You think about awareness. I don't know if you can sort of frame for us where awareness sits with the PRO in both new and existing markets? Then the opportunity, right, to grow the PRO member base this year, and just given the value proposition, some of these investments, et cetera. Maybe comment on if there are any sort of targeted or planned initiatives that you have in the pipeline here to really press the awareness factor. Yeah. I mean, our pro awareness is high. I think it's in the 80% for the vast majority of our markets. Maybe some of the new markets might be a little bit lower than that, but we have very good aided brand awareness with our pros. You know, you know our business well. I think it's a, it's a mosaic of things that we're doing to service that pro. It starts with great customer service. It starts with great assortment that's curated for the market. It's, you know, prices that matter and SKUs they care about. It's a dedicated team to take care of them. A great loyalty program. You know, we're testing this tiered-based program that we're excited about. Our in-stocks are better than they were last year. We see our in-stocks continuing to improve even from the good rate we're at. I mean, I think all those things together work in concert that we think will continue to take market share. We also have great CRM tools. Yeah. that allow us to follow up with those pros. I'll speak to just a couple of things that we're doing to increase awareness as well, or that should help awareness. One, recently, we put in a feature where our stores, when someone comes in and works with a designer, and we don't know the pro, the other pro's not in our system, now our teams can follow up. We weren't capturing that information historically. Same thing goes if a pro picks up product and they're not in our database, we now can contact them. That's new, relatively new. We've had it for a little bit of time, but that should help us get to pros who may not be familiar with us. Two, we're back out on the street. After COVID, our pro team stayed in the store more. We were trying to keep up with the business. Now we have the ability to get back out and go find new pros in the stores. Our stores are out doing that, pounding the pavement. Then third, it's been mentioned in our scripts over the last few scripts. We're doing an excellent job of getting pros in and doing training across, you know, whether it's our vendors or NTCA, we're doing classes and we're impacting more pros. All those things should help continue to build our brand awareness. Thank you. The next question comes from Michael Lasser of UBS. Good evening. Thanks a lot for taking my question. Tom, the skeptics are arguing the Floor & Decor has assumed in its guidance that trends are gonna get better based on the macro and easy comparisons and haven't factored in the prospect of a recession that could not only impact consumer spending, but also the prospect of the ability for the consumer to buy a home, which in turn would negatively impact housing turnover. That's gonna cause downside risks to not only this year, but also next year for Floor & Decor. Why is that wrong? I mean, I think, you know, we believe that as existing home sales turn positive towards the end of the year, that we'll see benefit from that. Historically, we've got a great correlation with existing home sales. We think that number, you know, as we said on the previous two calls, we don't believe that number goes below $4 million. If that number stays, we'll start adding the increase as we get to the back half of the year. We're taking share, Michael, at a really good rate. Our indications are that, you know, in this market that's contracting, we're taking share quicker this year than we did last year. I think from a share perspective, existing home sales turning positive, I think those things will benefit us. I mean, Michael, if you think about it, 19 months of year-over-year declines that we've had in existing home sales, I mean, at some point you think that's gotta come out. We have our house view. We've kind of given you guys that as well, that every comp point's worth $0.10 of EPS, so. Yeah. We believe our category's been in a recession. Yeah. It's there. Like, it's that. As we get to where things get positive towards the back half of the year, we think that gets a little bit better. Okay. My follow-up question is, how much do you think the independents and other players in the industry have already reduced price? How much do you think they will reduce price in the event that de-demand drops further from here? Yeah, this is Trevor. I mean, we are fortunate. We have merchants that live in all of our, you know, 12 regions, 13 regions, and we do detailed price shops every week. As we said earlier, when we look at our pricing, not just against our larger competitors, but even our smaller competitors, we think our price gaps are at or as good as they've ever been. You know, look, we have seen price come down. Others are passing on supply chain savings as well. You know, as Trevor said earlier, you know, we're confident in our spread versus them. We're not seeing irrational behavior within the marketplace. We feel good about that part of the boat. I think most everybody probably knows this, but maybe just in case there's new people on the phone. When you look at our pricing versus the independents, it's demonstrably below. You know, we're not talking 5% or 10%. You know, in many cases it could be, you know, 20, 30, in some cases 50%, 100% below, or their price might be 100% above ours. Even if they were to lower their prices more than we are, which we haven't seen, you know, our prices are so much below the independents that we don't think that that's gonna put pressure on us. Thank you. Ladies and gentlemen, in the interest of time and the length of the question queue, we ask that you please limit yourself to one question. Thank you. The next question comes from Chuck Grom of Gordon Haskett. Fortuitous timing there, I'm gonna try to sneak in 2. Wondering if you could share transactions by month during the quarter for us and also quarter to date. Then, wondering if there's any performance differences by region, particularly in some of these parts of the country where housing has seen more price compression over the past several months. I'll take the first part while Bryan's looking the transaction part up. Yeah, we're seeing more pressure in the West, which is where the housing challenge is the more significant. We're seeing those same challenges. I think the good news for us is we're less mature in the West. Our, you know, we've got good density in the West, but the stores tend to be a little bit younger, so they're still gaining awareness and gaining market share. Hopefully that helps offset a little bit of that softness. There's definitely been a change in trajectory in the West over the last 6 months. Yep. If you're thinking about the trend, the quarter was 9.9% down, negative transaction comp. It was 8.7% down in January, 10.8% down in February, and 10.1% down in March. Really didn't deviate that much kind of as we moved throughout. To Tom's point, the average ticket change was due to us lapping higher retail from last year, as well as square footage being down just a little bit per transaction. Thank you. The next question comes from Karen Short of Credit Suisse. Hey, thanks very much. Just a quick couple, two questions. With respect to the pros, I think you made a comment that you thought that the pro backlog had actually deteriorated. I wanted to just clarify that. The second question I just had is, I think you talked about in prior quarters when commodity prices come down, you're more likely to actually bring down prices. It seems like that's maybe not what you're saying today. I just wanted to clarify that. Yeah. I'll take a stab at that, and then Tom and Bryan can weigh in as well. On the pros, yeah, I think we are seeing backlogs sort of revert back to the mean. You know, they were so high and so strong for such a long period of time after we back opened up in the second half of 2020. You know, this is a bit of a generalized statement, but generally, if you want a pro to come to your house to do a measurement, give you a quote, you can have them in there within one week, and then they're gonna have that quote, assuming you agree to them. Once you agree with them, within 2, 3 weeks after that, you can have that installed. We spent a lot of time with a substantial amount of our pros. You know, in total, we probably talked to close to 1,000 of our pros over the last, over the last, you know, several months. What they're telling us is they're busy. They've got plenty of remodels. They're doing construction. They're taking on new kinds of work. The biggest piece of the business that has slowed, and it makes sense when you look at existing home sales being down 20%, 25%, 30% is the house flipper piece. That's the big piece of the pro business that I think has slowed. There's just not as many house flipping items going on. On the pricing front, I would say, again, as we've said a couple times, I mean, our prices are as good as they've been versus the competition. We have lowered prices this year, and we have seen competition lower prices this year. You know, I think we've been thoughtful in maintaining or in some cases improving our prices versus our competition, and we have lowered prices. Thank you. The next question comes from Seth Sigman of Barclays. Hey, guys. I wanted to focus a little bit on SG&A, specifically store OpEx, which I think was up about 3% per average store. I'm pretty sure that's above what you had implied in the full year guidance. Is, is there anything one-off or timing related that we should be thinking about? Just, you know, how should we build that out through the rest of the year? If I recall, you had also planned for lower volume in your expense outlook. You know, just how do we think about the levers if comps do stay at this level? Yep. Hey, this is Bryan. I'll go ahead and take that. We came in at 27.1% of sales. I think we guided to 27% for the year. As you think about that going across, it's gonna be 27. Our expectation is 27% for the year and pretty steady kinda throughout each quarter. That's the best way that I can help you kinda model that. That's what we guided to. Yep. On a per store basis, just to kinda clarify that as well. Versus last year, it is up just slightly, and majority of that is due to depreciation. Thank you. The next question comes from Kate McShane of Goldman Sachs. Hi. Good afternoon. Thanks for taking our question. I wondered if you could dimensionalize the share gains you're seeing any further. I know you mentioned you expect accelerating trends this year, Tom, but what are you comparing it to? I just would imagine that things were, from a competitive standpoint, given the supply chain challenges and inventory disruption, that there was probably some good share gain taken last year. just what should we assume for share gains this year versus what you saw in 2022? I mean, I'll start modestly better. I, you know, I think we're taking a good amount of share. I think the independents have a difficult time navigating in this environment. I think people are looking for value. We are the low cost leader. Our prices are the best. I think, you know, that's bringing people that are doing flooring jobs into our stores. I just think because of the nature of this macro environment, that our ability to take share versus independents is pretty significant, and it's what we're, you know, it's kinda what we're seeing. If you, if you look, you know, when Mohawk Industries, Inc. did their call and Mohawk Industries, Inc. talked about North American sales, their North American sales were down a little over 11% in their call. There's some soft surface in that, so it's not all hard surface, but, you know, our total sales are up 9% in the quarter. If you look at, you know, our market share versus the growth in the industry, when you look at, you know, market insights and some of the other people that provide that, they're not showing the market growing at the same rate we are. We had one of the largest credit card issuers, at least for their business, which they own a substantial portion of the U.S. credit card business, you know, show that since 2020, we'd had over 500 basis points of market share gain relative to what they saw from their other people buying from specialty flooring as well. You know, the ways we triangulate, it shows in all cases, we're gaining market share in this environment. Thank you. The next question comes from Jonathan Matuszewski of Jefferies. Great. Good afternoon. Thanks for taking my question. Trade up to better and best SKUs has been helping gross margin for a while now. Sounds like that continued in 1Q. Is this dynamic anticipated to continue as we move throughout the year? And basically, is this, you know, dynamic factored into the gross margin guidance? Thanks so much. Hi, this is Ersan. Our better and best penetration continue to improve year-over-year. We run even when we did the retail reductions, we took the approach of the balanced portfolio approach so that we can have a better shopping experience for our customers. At this point, we see the trend going to better and best as we continue. I think, you know, I think when, if a consumer is going to do the job in their home, they're gonna buy what they want. You know, the less consumers are coming in and opting to buy. I think if they're doing the job, they're gonna buy what they want and that they tend to gravitate towards the better and best. Our merchants have done an outstanding job continuing to go. We never stop doing product line reviews. We never stop bringing in new products. You know, we're playing for the long game. This is, this is a moment in time. This is a difficult macro, but we know on the other side of this, we'll be ready for it. I expect those trends to continue and those should continue to help margin, and that's into our assumptions. Thank you. The next question comes from Justin Kleber of Baird. Yeah. Good afternoon, everyone. Thanks for taking the question. Just another follow-up here on the price reductions. How much have you rolled back prices? It wasn't clear to me, are you already seeing customers respond to lower prices, or are you just expecting that to happen? I think you said, Tom, that transactions decelerated in April from the March rate. Just want some clarification there. Thank you. Transactions were flat in April to, you know, so in line with our expectations. It's too early to understand elasticity in the price changes. You know, if you go into the stores, you'll see there's signing in the stores where we've taken the prices down. You know, as I mentioned on the previous call, I mean, part of it is we wanna stay the low cost leader. We took price for the first time since I've been here. We took price as supply chain costs were coming down. We felt that we need to pass some of that back to our customers. To our professional customers, as supply chain costs have gone the other way. We're their partners, and we wanna be their partners in the long run, so we felt it was prudent. It's too early to tell the benefits of it. We've maintained our spread while taking the prices down, but as I said earlier, we're gonna watch elasticity, and we'll be thoughtful in what we pass along for the remainder of the year. Thank you. The next question comes from Seth Basham of Wedbush Securities. Hi there. This is Nathan Friedman on for Seth. Thanks for taking our questions, and I'll try to squeeze two in here. First, as you start to renew some of your freight vendor contracts, should we be contemplating some gross margin benefits now that freight costs have come down significantly, or is this not as material of a benefit in times past? Secondly, it may not be as large of an issue as it was in the past given some navigation out of Asia, but we've read about regulatory changes regarding imports from Asia being interrupted with the U.S. requiring proof of supply chain compliance as part of a Forced Labor Protection Act. My question there is, just curious if there's any impact you're seeing that we should be contemplating or considering, or if this is further helping some share gains as others struggle. Thank you very much. I'll try to answer both of those for you real quick. This is Bryan. From a cost perspective, just keep in mind that we're on a weighted average costing system, so all of that favorable supply chain impact that we've gotten from a cash basis or from a contract basis in Q4 and earlier in Q1 will bleed in throughout the year. Those have been contemplated kinda throughout the year, and that's part of what allows us to have the optionality to give some of that back to our consumers. That is contemplated in there, and we do expect to continue to receive savings throughout the year. With that, as far as your second question, for the Uyghur compliance stuff, to date, there have been no actions that have impacted our business. Just to expand on that a little bit, you know, we're focused on working with our suppliers to prevent disruptions by continuing to map their supply chains, monitor their material sourcing, and being prepared to respond to U.S. Customs if or when needed. Thank you. The next question comes from Christopher Horvers of JP Morgan. Thanks. Good evening, guys. My only question is you think about the average footage increase that you've seen maybe since 2019, how did you think about that in terms of laying the guidance out? You know, if we went back down to more of a pre-COVID size average project, what would that represent from a comp headwind perspective? Yeah. I'm not sure. I mean, you know, we're looking at each other, Chris. That's a really good question, to understand. I think that our average square foot pre-COVID was probably better than it is today. I don't have that data in front of me, but I would say there's a pre-COVID number. It's slightly, but I wouldn't say that it's materially different, Chris, the way that I would say it. It is down slightly. As we talk about our square foot per transaction is a little bit less, but it's definitely when you think about projects, 'cause do they come in two times, three times, four times? Or do they come in once and kind of bundle that together? Square foot for us, we tend to look at on a project basis as well as on a per transaction. I'd say on a project basis, it is down a little bit from pre-COVID, but I wouldn't say that it's materially less. You know, there's other complexities in that too. You know, our PRO business was probably 30% of our sales back then. Now it's over 40%, at least the PRO tendering it. You know, our design business was much less material than it is now. We know when our designers are involved, the project size goes up as well. It's just a, it's a fairly different business now than it was back then. Thank you. Your final question comes from the line of Elizabeth Suzuki of Bank of America. Great. Thank you for squeezing me in. I just had a question about, you know, the inventory. You mentioned that it was down in the quarter and from fourth quarter, and I'm just wondering what that looked like in units and whether there was some intentional destocking there based on what you're seeing in demand. Yeah. I mean, look, units were down, from year-end 'cause you're talking about from December 2022, we were down 8.6%. Yeah, I mean, some of that was us putting some pressure on orders, just getting it in line. You will see that grow year-over-year as we exit the year. It's just gonna grow at a slower rate, modestly slower rate than we will for sales. There were units down. I mean, that was-. I would just say that our in-stock is terrific. Our in-stock is Yeah, our in-stock, our in-stocks are terrific, and they're a lot better than they were a year ago. Yep. Most of our stores are gonna open in the back half. 65% are opening in the back half. That's part of the inventory build as well, is as we get into the back half and as we open more stores early in 2024, you're gonna see some of that build up. I appreciate everyone joining the call. Thanks for your questions. I'm gonna forward to updating you on the next quarter. Thank you. Goodbye. Thank you, sir. Ladies and gentlemen, that does conclude today's teleconference. Thank you for attending, and you may now disconnect your lines.