Let's get started. Thank you, everyone, for joining this afternoon. My name is Terry Ma. I cover mortgage finance here at Barclays. I'm very pleased to have the gentlemen from Fidelity National Financial joining me on stage here. I have Mike Nolan, CEO, and Tony Park, CFO. Thank you very much for joining. Welcome. Thanks, Terry. To start off, let's just maybe get a mark to market for third quarter on purchase, refi, and commercial order count trends. Can you also just remind us what July trends were and what August is shaping up to be? Yeah, sure, Terry. I'll start with that. The purchase side in July, orders were flat with the prior year. We kind of saw the same thing in August. They're up about 0.5%. Really a flat purchase market, which really isn't surprising, given all the dynamics that are going on with housing affordability and all those things. Our refi is doing a little bit better. We were up 20% month over month in July and up 10% August over August. It'll be interesting to see, with rates which are starting to come down a little bit, whether that generates some more activity as we go into September. I think it will, but it's going to kind of depend on how those rates hold up. On the commercial side, it still seems to be pretty strong. We're up 14% July over July and 5% August over August. Our national orders were up 22% in July. We've talked about the strength in national, and they were up 10% August over August. Got it. Mike mentioned, I'll just chime in for a moment, Mike mentioned the rates and them coming down. I know it's been fairly short-lived, but I think the daily rate on Friday, I didn't look at it yesterday, but the daily rate on Friday was 6.29%. Clearly about, you know, 70 basis points below where it was a couple of months ago. That's helpful color. As you mentioned, commercial has been pretty strong. I think national orders have been up double digits for something like five consecutive quarters. Right. Can you maybe just talk about what sectors you're currently seeing the most activity? In terms of the just strong commercial trend, how long can that persist for? Yeah, I mean, you're right. It's been five consecutive quarters with double-digit growth. Remember, national orders are our highest fee profile part of the business, so that's really encouraging to see that we have that. In terms of the asset classes, it's still consistent with what we've talked about really for the past couple of years, which is industrial, and that encompasses a lot of different things. Multi-family, energy transactions, you need to think of like wind and solar. These data centers, which probably fall in the industrial category, are certainly having a big impact on the industry. These are really big ticket items, and there's more of that. You've also got things like affordable housing that are still doing well. At times, the retail, hospitality, gaming segments are pretty good. The one that's still not is office, although it's getting a little bit better on the margins. We're having this great kind of commercial market. We're probably on track to have our third best year ever, only behind 2021 and 2022. When you think it's doing that without really much office, as office comes back, and I think it will at some point, I think that'll be additive to the commercial opportunity. Great. Maybe we touch on home price appreciation. That's, you know, seemingly moderated in several regions, and a few regions have maybe turned negative in recent months. Maybe the HPA impacts on fee profile also affect affordability. How do you foresee this impacting your business going forward? Yeah, I would say on the home price appreciation front, we tend to see maybe about a 60% correlation between the change in home prices and our average fee profile. That can change from market to market. If home prices are up 5%, then our average fee on average might be up 3%. Of course, it works in reverse as well. The good news would be if home prices stabilize and come down, we should see a lot more volume. Frankly, we would prefer that over a little bit higher fee profile. We'll give up a little fee profile to get a lot more volume. Got it. Maybe just digging a bit deeper on fee profile, what are some of the trends you're seeing there quarter to date? I guess I can weigh in on the residential side. I would say second quarter over second quarter, our purchase fee profile was up about 3%, and our refi fee profile was also up about 3%. What we've seen in July and August kind of goes to your point that maybe we see home prices stabilizing or maybe even coming down because our fee profile in August is down about 2% from where we were in June on the purchase side. Refi is about flat, so it hasn't moved much. Yeah, I'd say on the commercial side, the quarter's not over and it can really depend on what closes out right in September. We've been running about $15,000 on fee profile in national and I think high $8,000 on local. I think that's probably a good proxy to think about as we go through the third quarter. We'll just see what shows up on the closing side in September. Okay, that makes sense. Maybe we'll shift over to margin. That's been roughly flat year over year, the first half at 13.8%. Obviously, there are some margin headwinds from investment and healthcare costs in the second quarter. You've indicated confidence in reaching your 15% to 20% margin guide, even with the healthcare-related drag persisting. Maybe just briefly recap the drivers that negatively impact the margin and just talk about your confidence level in achieving that 15% to 20% guide. Sure, do you want to start with the headwinds? Yeah, the healthcare cost was about $12 million in the quarter, which was about 60 bps. That, frankly, surprised us. We've had pretty consistent trends over the last couple of years. In May, we had very few but high-cost claimants. That's persisted through May, June, July. We took that $12 million charge as an estimate on what the cost would be as we make our way through the year. I wouldn't be surprised to see maybe $4 to $5 million in headwinds in the third and maybe fourth quarters. There are things we can do certainly next year to plan for if we expect healthcare costs to continue to increase, changing up programs, working with vendors to maybe manage some of our claims or types of claims differently. We're looking at all those. We can also raise rates and we can certainly pay more as a company and maybe charge our employees a little bit more. I don't think this is unique to us in terms of healthcare trends. I see a lot of articles that talk about healthcare trends that have been increasing. Frankly, we've been pretty stable for a couple of years. I guess this was our point where we saw a little bit of an increase. The second point, smaller number, but we were about $10 million or so higher in tech and security and risk spend in Q2 relative to Q2 of last year. That was one of the headwinds, if you will. I think we're on a good run rate, so I don't think that goes higher from here. It's consistent with what we spent in the first quarter, but it is higher than the second quarter of last year. I think we'll probably be steady as we go through the balance of the year on that front. Okay. What I'd add to that too is, you know, when we came into 2025, our base case was it was going to look a lot like 2024. That's really how it's played out. Our margin through the first half was essentially flat with last year. Yeah, $13.8 million, right. As we go through the back half, I think that expectation holds. It should look a lot like last year. We would still expect to probably hit or maybe slightly exceed the margin we had for last year. Okay, that's helpful. What about the margin headwind from hiring and recruiting? Can you provide some additional color there on the kind of opportunity you saw, and how do you kind of evaluate similar opportunities going forward? Yeah, thanks. That's a good question. We always focus on recruiting. We always have, and our belief is we do that regardless of the environment. We're recruiting every quarter and we're trying to bring over talented people from other title organizations who can bring us revenue. These are revenue-attached recruits that we're talking about. We hire other people, but we don't talk about them in this context. We had one of our best recruiting quarters we've had in a really long time in the second quarter. I think it's partly just the focus we put on it with our scale. We're trying to do it across all the geographies we're in. We have more geography than anybody else. I think there's also, you know, we're in year four of a down market. I think there's just more opportunities to talk to people who maybe aren't as happy at what's going on inside their company. Maybe they don't feel they're investing as much in the business as they might in a better market. We continue to invest. We're doing a lot of interesting things on the tech side and others. I think it's resonating and we bring them in. They're like mini acquisitions. You're bringing in revenue like you would when you buy a company, but it's one person at a time. They also have front-loaded expenses before the revenue shows up. You're hiring them, you've got their cost immediately and maybe some other cost and having them come over. The revenue is maybe showing up 60, 90 days later because they've got to start to try to board their clients into our organization before the orders show up. The orders close out with the tail of 45, 50, 60 days. From our view, it's a really positive event that we had such a good recruiting quarter. Compared to the second quarter last year, it did clip the margins a bit. Got it. On that note, other mortgage companies have been working on preparing themselves to react just more effectively to kind of an uptick in volumes. How has FNF kind of improved its position since last year? Yeah, you know, we have a lot of experience with scaling this business up and down from a staffing standpoint. We're very good at it, and the people we have in the field know how to do it in their local markets. You can look at different points, back during the recession in 2007 and 2008 when we had to downsize the company by over a third. We did that very quickly, and as markets improved, we built the company back up. We did it in the pandemic, when that hit in March of 2020. I think we took out 20% or more of the staff in a month or a matter of weeks because our view at the time was it was going to be a bad year. We didn't know rates were going to go so low, and we had to hire a lot of people back very quickly. We hired a lot of the same people back, actually, on that one. Our field people are very good at it. Part of it is when you think about the structure, we have 1,300 locations in local communities across the country. If everybody, and it's not this simple, but if everybody adds two people, you've just added 2,600 people. The problem to solve, either up or down, is dispersed in a way that makes it easier to solve, if that makes sense. I think we're not worried about having to add to staff if we need to. As we look forward, how can we think about incremental margins on business for no purchase, refund, or commercial? Should those kind of pick up more meaningfully? Yeah, I would say that we generally talk about incremental margins in our direct operations at about 40%. It can probably vary a little bit within those buckets. Maybe our national commercial is probably a little bit stronger. If we get a real surge in, let's say, refinance at the centralized level, then it's probably better than that. I think that's a pretty good proxy is 40% incremental margins. Okay, that's helpful. Maybe switching gears a little bit, are there any longer-term investments that you're getting excited about that you can share with us, i.e., SoftPro or anything else? Yeah, I think there's a number of things. SoftPro is certainly one of them. SoftPro is the title enclosed technology we use in our business, and we've now deployed that across the entire footprint. It was a multi-year process to get that done, but we're on one platform, and that actually is very helpful to deploying things like AI, as well as gaining efficiencies around managing your tech stack. You know, we buy a lot of companies over time, and with that, you get a lot of different technologies. We're very excited that we've gotten SoftPro basically deployed throughout the whole company. Second is our inHere digital transaction platform, which we've rolled out. I think we're in year four, maybe on that one. Yes. That's now rolled out across the company. It's a transactional platform where someone can start from beginning to end digitally and do a transaction with us. We've got about a million users in the past year. Think, you know, consumers, real estate agents, lenders. It's really gaining a lot of traction. We think that'll continue to grow now that we've fully deployed because it's connected to SoftPro. The APIs to surface up the information for the inHere platform in front of the customer come through the connections with SoftPro. Now that we've got that fully deployed, we can do that everywhere. We're the only title company that's done it across their footprint, and we've got more scale than anybody else. We think there's a lot of other things that we can do that are interesting inside inHere that can lead to other places and have market share gains. We think it could become a way to engage with customers, not just during the transaction, but after the transaction. We've got some ideas around that. Some things are in pilots, but we think it's interesting. We just announced the partnership with Clear that came out today. We put a lot of effort into working with them to take what they do already very successfully in airports and ballparks across the U.S. and help us deal with fraud in real estate. We're not prepared to get into a lot of specifics today, but we're excited about this. We think it's an innovative idea. No one else has done it. That's another thing. Really just AI in general. We've got a lot of data. We've got one operating system, and we think that affords us a really unique position to leverage AI for the benefit of the company and efficiency and really the benefit of our customers. That's helpful. What ending are you in terms of AI? Are you in the just beginning stages, exploring, or how should we kind of think about that? I think it's pretty early innings. Here's kind of where we started. We've built out an infrastructure with the Chief AI Officer. We have a working group of individuals throughout the organization that help evaluate use cases, governance, risk, HR. You've got to build kind of a discipline around evaluation of AI. The next big step, which we're on, is building literacy. Anyone that's got to roll this out in big organizations, you've got to build literacy for your employees. We've rolled out the Microsoft Copilot tool to every employee. Everyone's got access to AI tools now to start to learn how to use them in their daily work. We've rolled out the GitHub tool to all of our developers. We have hundreds of developers in our different businesses, things like SoftPro in India and others. We've got maybe 10 use cases in various levels of study, if you will. When you think about all the documents that we use in real estate transactions and in our business, I think there can be, in emails, I think there can be a lot of productivity lift leveraging AI tools to help us get through that information quicker, faster, get to the answers quicker, but still with sort of human-in-the-loop control so that we don't introduce risk in a business like title insurance where we underwrite to zero, actually. Okay, that's helpful. Maybe one last question on margin drag in the last quarter. Can you maybe just provide some color on why there was extra spend on cybersecurity? I think the overall environment just requires more spend on tech and risk and cybersecurity. If you go back five years, our budget was probably a fraction of what it is now. It's just the environment that we're all in to protect our employees, our company, our customers from risks, bad actors out there. Like I said, I think we're on a good run right now. We spend a lot more now than we used to a couple of years ago. I think that's true of virtually every company. You have to spend and harden your systems from a risk standpoint. The bad actors aren't going away. AI is going to aid that as well. That's a great thing for it to happen in productivity, but it's also going to bring more risk into real estate fraud and other types of frauds. Okay, got it. Maybe just switching gears and talking about the regulatory front, concerns on the title pilot were reignited. Considering you've conversed with Paul T shortly after his announcement on expansion of the pilot, is there anything incremental you can add on just, you know, your thoughts or views about the pilot? Sure. I think maybe to correct something, because I think that was the narrative when he made the announcement about WestCore being added as a vendor, I think that was commonly interpreted as an expansion of the pilot, meaning more transaction flow through the pilot. That's actually not the case. That is one of the parts of the conversation I had with him the next day after the announcement. The intent is not to expand the pilot. The pilot's the pilot. It runs till May of 2026. WestCore was brought in as a second vendor. I think it got brought in because of concerns. I mean, I don't know this specifically, but concerns that the waiver idea just wasn't resonating, that there was pushback to that. Think about it. If you're a lender, you go from a world of a title policy that provides significant protections, duty to defend, gap coverage, fraud coverage, forgery coverage to a waiver. I think the WestCore alternative is like a step towards more of a title policy. It's not a full title policy, but it provides some of those protections. To me, it was actually a bit of an affirmation of the value of title, that movement. The pilot itself, I think, is very small. I don't feel it has a material impact on us, certainly today. It's due to expire in May of 2026. May get extended. We'll see. Really, really not much color. When I talked to the director, I've met with him twice, just reiterated that we don't support the idea of a waiver. We think it's bad policy, a bad idea. We're very open to continued conversations with the GSEs on this topic, as well as many other topics. We talk to the GSEs all the time about various things. We're engaged with them at different levels of our business pretty much every day. We've always been collaborative, and I think he appreciated that. We had a good conversation. I appreciated his time. That's kind of where we're at. Got it. Okay. Maybe just taking a step back, anything else on the regulatory front you were kind of watching out for? You know, there's always things going on at the state level, various bills that are in consideration or maybe have been passed. They're not necessarily directed at the title industry, but they can have impacts on the title industry or the broader real estate industry. We're monitoring state-level bills every day, thousands of them, actually, that might have an impact some way or another. We advocate when we feel the need to. We're pretty good at it. I think states are pretty receptive to hearing concerns. We have a team of people that do it. Really, that probably the other thing is the proposed FinCEN rule. I don't know if you're familiar with that, but FinCEN is proposing to significantly expand the transactions that the title industry has to report to them that might be considered suspicious. We're talking about an expansion of maybe 20,000 reports today to 800,000 or 900,000 or a million in the future. We think it's not necessary. There are privacy concerns that we have. We filed a lawsuit to challenge it. We're the only ones in the industry that did that. The form itself that will now be required has 111 fields that have to be completed on every one of these transactions, many of them multi-part sections. For it to be compliant, every single field has to be completed or you can't file it. A lot of times, we're not sure we'll even have the information. That's something that we're concerned about. We're also prepared to, you know, we're also working to comply with it. It's due to go into effect December 1, unless we're successful. That's just in the legal domain right now. Got it. What is the implication if that ultimately kind of goes through and it gets expanded from, you know, $20,000 to? It's just more work for every closing company and more cost. You know, again, we think it's overreach from our view. There are some privacy concerns that we think are important to air out with the government. We'll comply like we have with anything else. It's just going to mean more cost and more work. Got it. I'm sorry, maybe one other regulatory, are we done with that one? I was just going to ask, any way to kind of quantify or size the incremental costs to be compliant with that? I don't really know. I think it's the kind of thing you have to get into to find out. We'll automate as much of it as we possibly can. I'm a little bit more concerned about how able the industry will be to get all this information and what will happen to a closing if there's one field that hasn't been filled out. Yep, got it. Okay. Yeah, I was just going to mention, and we've talked about this before, but the state of Texas looks at rates. Every five years, they promulgate rates in Texas and proposed a 10% increase earlier this year. That's been challenged, and I believe it's working its way through the courts to see where that lands. We made an estimate, and if we had 2024 volumes with that new rate structure, it would have impacted our revenue by about $70 million and our pre-tax profits by about $14 million, assuming we didn't take any actions to reduce that impact. Again, that's just a proposal or a recommendation at this point. It's not in effect. You know, we don't know exactly when and where that will land, but I thought I'd throw that out there because that is still an open item. That's right. Got it. Maybe we'll shift gears and talk about capital returns. There has been an increase in the buyback in recent quarters. Maybe just remind us of the priorities when it comes to capital allocation and how you think about use of excess capital. Yeah, I would say the priorities would be our dividend, our common dividend that we, you know, we pay obviously every quarter and look to raise that typically annually in the fourth quarter. That's about $550 million at the current run rate. That's clearly a priority number one, as well as interest expense. Our debt levels are pretty low and our rates on that debt are very low. That's $75 million, but clearly a must-have. After that, it's more opportunistic. It's between M&A and share buybacks. We generate about $900 million to $1 billion annually of Holdco cash flow that we upstream to Holdco. That's in a trough environment like what we've seen the last couple of years. You're right. We did. We took a pause for a couple of years on the buyback front because we knew we were in a challenging market and wanted to make sure that we were maintaining strong cash position, which we did. The board decided to restart the buyback in the first quarter. We did that modestly. In the second quarter, we saw some weakness in our share price. It came down from, call it, the mid-60s to maybe the mid-50s or below. The board at that point felt like this was a great investment for us to be more active on the buyback front. We bought about 3 million shares, spent about $160 million in the second quarter on share buybacks. We don't give guidance in terms of our expectation for buybacks as we work our way through the year. I will say and have said that we are active, and we typically are active on a daily basis. I'm not sure we'll be as aggressive as we were in Q2, but I do believe we'll be in the market. M&A was softer last year, as Mike talked about it a little bit when we talked about recruiting. There are plenty of potential targets out there, but valuation, you know, may be an issue. We haven't had a lot of M&A activity in the last year, year and a half. Got it. Maybe along that point, what type of deals are you most interested in, and what are you looking for that fits best into your business strategy? Some things we've talked about in the past, and we'd really like to ramp up the agent acquisitions that we've always done. As Tony said, it's been a little tougher in this lower transactional environment where people want to hang on for a better year to get a better multiple, frankly. We're in year four of this down market. Maybe those opportunities will start to break open. We need to do more of that. If we saw things, and we've talked about it, and things like home warranty or appraisal, some servicing, these other connected businesses we have, that's where we'd like to do things. We're not really looking outside of the real estate-related businesses to invest in. Got it. Okay, that makes sense. I'll be remiss if I don't talk about F&G. You know, it's been really great for earnings, generating about 30% of FNF adjusted earnings the last few quarters. Maybe just, it feels like it's going to be a more durable part of the company going forward. Maybe just remind us how FNF views F&G and just talk a little bit more about what F&G kind of looks like going forward. Yeah, maybe I'll touch on that. Mike can weigh in. I would say that the board's been very pleased. I think the thesis behind the acquisition was, let's buy a business with recurring revenue, recurring earnings that we can grow and kind of complement the title business, which is cyclical. It's really exactly what's happened. We've expanded. We got the ratings upgrade. We've expanded into multiple channels. We've grown our sales from $3-ish billion to $15-ish billion annually. We've grown our assets under management from the mid-20s to close to $60 billion now. The performance has been wonderful. We had maybe a little pushback on the shareholder side of things as they didn't feel like we were getting, and agreeably, you know, so didn't feel like we were getting full valuation of that investment reflected in FNF share price. We decided to float a small portion of the shares publicly back a couple of years ago. I think that was December of 2022, maybe, something like that. Anyway, we only own 82.5% of the business today, and we do have 18 or so% of shares public. That certainly moved up from where the IPO price was, which was about $19. I believe that we're getting some of that valuation reflected in FNF's current share price. Some would argue maybe not all of it, and I think that's fair. Like I said, the performance is good. The earnings are consistent. The opportunities are still there to grow the assets. They are looking at maybe a slight shift in strategy, which is less capital intensive, with signing a $1 billion sidecar with Blackstone and getting some fee income from that. We have an own distribution strategy where we're getting some fee income there, looking to maybe instead of just growing the asset base in all areas, we'll look to be a little more strategic and opportunistic in terms of areas where we might grow that are generating the highest return. Maybe, yeah, a long way of saying I don't know that it's a permanent part of FNF. I just don't, I can't answer that question. I will say it's been a nice complement, a very good investment, and we've been very pleased. Got it. Yeah, it sounds like it's been performing well. Maybe just kind of remind investors, like the date everyone kind of seems to have focused on was, you know, June of 2025 as the first day, you know, you could implement or affect the tax-free spin. What are kind of some of the factors that you may consider for that process? Yeah, I mean, that's right. We needed to hold it five years for tax purposes before we could spin it out to our shareholders tax-free. Theoretically, we could take that 82.5% ownership that FNF has and spin that to FNF shareholders, and it wouldn't be a taxable event. That is available to us and became available to us in June. Some may expect that we will do that because we've done that type of thing in years past with other investments. We know how to do that. We have experience doing that. I think some people maybe even think we should do that. Who knows? I don't know if we'll end up doing that. There are other ways to monetize or divest of F&G if we chose to go down that path as well. Maybe not as tax-efficient because it would involve a sale or a merger and potentially a taxable event. We do feel like we've built up great value here. I think the book value when we bought the company was somewhere in the high $2 billion range, and now it's pushing $6 billion. We've really grown the book value, grown the earnings, grown the earnings generation base. I think we have a really valuable asset here. Okay, great. We have a few minutes left. I'm going to pause and see if there are any questions from the audience. No questions? All right, maybe on that note, we'll just wrap it up.