Today, I welcome you to The Beauty Health Company's Second Quarter 2025 Earnings Conference Call. All participants will be in the listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch-tone phone. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Norberto Aja, Investor Relations. Please go ahead. Thank you, operator, and good afternoon. Thank you for joining The Beauty Health Company's 2025 Second Quarter Conference Call. Our earnings press release was issued this afternoon and is available on our investor relations site at beautyhealth.com. Joining me on the call today is The Beauty Health Company's Chief Executive Officer, Marla Beck, along with our Chief Financial Officer, Michael Monahan. Before we begin, please note that today's discussion includes forward-looking statements, including guidance and underlying assumptions, which are subject to risks and uncertainties. Actual results may differ materially. For further discussion of risks related to our business, please refer to our SEC filings. We may also reference non-GAAP measures, with reconciliations available in our earnings press release furnished to the SEC and available on our website. Following management's prepared remarks, we will open the call for a question and answer session. With that, I would now like to turn the call over to our CEO, Marla Beck. Please go ahead, Marla. Thank you, Norberto. Good afternoon, everyone. Q2 marked another strong quarter, demonstrating the momentum of our transformation strategy and disciplined execution. We exceeded both revenue and adjusted EBITDA guidance for the third consecutive quarter, driven by our consumables revenue, margin expansion, and operational improvements. During the quarter, we successfully launched the Hydrophilic with Peptide Booster, which has quickly become our top-performing Hydrafacial branded booster. We expanded to over 35,000 active devices globally. We saw significant gross margin improvement, GAAP at 62.8%, and adjusted at 65.9%. We completed our transition to a distributor model in China, and we restructured our debt. These achievements fueled $78.2 million in revenue and $13.9 million in adjusted EBITDA, both above expectations. Our consumables business, now over 70% of revenue, remains strong, demonstrating the impact of our Razor Razor Blade model. A favorable mix, judicious cost control, and inventory optimization continue to enhance profitability. We reduced operating expenses by nearly 18%, lowered inventory, and closed the quarter with $212 million in cash following a strategic debt restructuring. While we've made significant progress on adjusted EBITDA and cash flow, device sales remain pressured due to macroeconomic headwinds. That said, we're confident in the long-term opportunity and in our ability to improve performance through strategic execution and innovation. Over the past year, we've taken several steps to drive equipment sales growth in the future. These include a strengthened sales organization with new leadership at every level, including a new Chief Revenue Officer to instill a data-driven approach to pipeline management and execution, an upgraded CRM to better leverage field and lead data to target new providers, and improved alignment between sales and marketing around shared initiatives to expand our global presence and footprint. Our strategy continues to center on three pillars: commercial execution and operational rigor, innovation acceleration, and provider-centric growth. Regarding commercial execution, our Razor Razor Blade model continues to scale, with consumables driving recurring revenue and margin expansion. Providers consistently see strong ROI from Hydrafacial devices, evidenced by exceptional loyalty. Over 1/3 of U.S. providers have partnered with us for over five years, contributing significantly to consumables revenue. We ended the quarter with over 35,000 active devices, up from 33,500 last year. Our Good, Better, Best offering is resonating, with Syndeo sales accounting for two-thirds of device sales and non-Syndeo sales accounting for the remaining 1/3. Booster sales in the Americas rose over 8% year-on-year, led by the Hydrophilic with Peptide Booster launch, a booster clinically proven to address fine lines and wrinkles. This demonstrates the end-consumer demand for our premium treatments. We plan to build on this momentum with more innovation in the back half of 2025. In EMEA, increased booster adoption and expansion in the medical channel are positive signs for us to capture future market share. In addition, during the second half of the year, our global commercial teams will begin rolling out a new strategic engagement program to deepen account relationships and drive growth. Moving to science-backed innovation, through our MedTech Meets Beauty strategy, we're advancing clinically validated innovation, building on our 28-year legacy. HydraFillic with Pep9, our most successful booster launch to date, exceeded 30-day targets and outpaced Hydralock HA's strong debut. Hydralock adoption and penetration continue to rise. A third of U.S. providers have now purchased Hydralock HA boosters. The performance of these two booster launches demonstrates that our strategy to invest in Hydrafacial branded, clinically backed consumables is resonating with our providers and the end-consumers. We're continuing to implement our Wrap the Treatment Room strategy to support our providers in enhancing patient and consumer outcomes and generating revenue. This includes the launch of the Hydrafacial Backbar product in the fourth quarter of this year, aimed at boosting in-office treatment results and provider revenue. A new retail skincare line debuting with a single-hero product also in the fourth quarter of this year, along with more SKUs planned for 2026, and upcoming launches of two new scalp tips for Keravive and a lip tip, both now expected in 2026. This Wrap the Treatment Room strategy includes boosters, backbar, and skincare, which work together to enhance treatment outcomes and extend the benefits of a Hydrafacial treatment. This strategy helps to deepen engagement, increase utilization, and drive revenue for our providers. All of our innovation remains grounded in clinical rigor and will be supported by our talented team of Business Development Managers and our extensive provider network, all of which are part of our competitive edge in the physician-dispensed topicals market. As it relates to strengthening provider partnerships, providers are the backbone of our success. In the U.S., our largest market, we're seeing continued strength in national accounts. Excluding Sephora, consumable sales in the first half of 2025 increased by 6.1% over last year, partially driven by double-digit growth from our largest national accounts. We're also seeing continued traction in EMEA, evidenced by double-digit growth in consumables this quarter. To support our providers, we're enhancing business development tools and preparing to relaunch our loyalty program in early 2026. The redesign aims to reward long-term commitment and drive incremental sales. Given the recent BCG report that shows expected compounded annual growth in the specialty facial sector to be 7% through 2029, we are uniquely positioned with our device-installed base and recurring revenue consumables model to drive profitable growth. Hydrafacial is one of the most in-demand skin health treatments globally, with 5 million treatments delivered in 2024, over 175 patents, a 96% worth it rating on Real Self, and a Net Promoter Score of 52, the second highest in our industry. We're also the second most recognized facial treatment in the U.S. and the number one brand driving new patient traffic to med spas in our category. In summary, Q2 highlights the strength of our recurring revenue model, the growing reach of our brand, and the meaningful progress of our transformation. We're grateful to our global team and our provider partners. Our focus remains on driving sustainable growth and long-term value creation. Now I'll hand it over to Mike. Thank you, Marla. Good afternoon, everyone. I'm pleased to report we once again exceeded our initial expectations this quarter, driven by the hard work and disciplined execution of our global teams. The business is undergoing meaningful change to drive value, and our teams are delivering. While there is still work to be done to grow equipment device sales, we are successfully controlling our costs to drive increased adjusted EBITDA and cash flow. As a result of our favorable performance in the first half of 2025, we are increasing the low end of our net sales full-year guidance range to $285 million- $300 million and increasing both the top and bottom end of our adjusted EBITDA guidance range to $27 million- $35 million. For Q3, we expect net sales between $65 million and $70 million and adjusted EBITDA between $2 million and $4 million. This guidance reflects the seasonally slower third quarter in our industry, along with strategic R&D investments we are making behind device and consumables innovation, including backbar and skincare. Revenue for Q2 came in at $78.2 million, GAAP gross margin was 62.8%, and operating loss was - $2.7 million. Adjusted gross margin was 65.9%, and adjusted EBITDA was $13.9 million. Our global footprint continues to expand, which adds to the recurring consumables revenue stream. In the second quarter, we sold 957 total units worldwide at an average selling price of approximately $23,362. As of June 30, 2025, total active machines in the field increased to 35,193 units vs. 33,504 units at the end of Q2 2024. Consumable sales for the quarter totaled $55.8 million, up 0.8% year -over -year, driven by growth in the Americas and EMEA, offset by declines in APAC, primarily driven by the transition in China from a direct business to a distributor model. As with recent prior quarters, macroeconomic pressures continue to impact capital equipment purchasing decisions, contributing to a 36.5% year-over-year decline in global device revenue. Our Good, Better, Best device strategy aims to address this by expanding provider access by offering select systems at lower price points. This initiative continues to deliver results, as non-Syndeo systems represented 37% of total devices sold globally, up from 28% in Q2 last year. We continue to believe we will be well positioned to capture additional market share when the macro environment improves. From a regional perspective, Q2 consolidated revenue in the Americas was down 9.8%, while revenue across APAC and EMEA declined 43.4% and 4.2%, respectively. Contributing to the decline in APAC is the planned go-to-market strategy change in China. We have transitioned the business from a direct to a distributor model. As part of this plan, we ensured that we warehoused enough capital equipment inventory in China to satisfy expected equipment demand for the remainder of the year that will not be subject to tariffs. We will have some exposure to tariffs for consumables sold in China. However, we are working through this with our new distribution partner. As a reminder, we closed our China production facility in Q4 of 2024 and centralized production in the U.S., minimizing our global tariff exposure. Gross margins were in line with our expectations, with the strong improvement year over year, driven primarily by disciplined demand planning and overall management of inventory, a favorable mix shift towards consumable net sales, and improved operational processes. Specifically, gross profit for the second quarter was $49.1 million, comparing favorably to $40.9 million in the prior year period. Adjusted gross margin for the quarter was 65.9% compared to 49.4% in the prior year period. GAAP gross margin for the quarter was 62.8% as compared to 45.2%, improving significantly versus the prior year period. Total operating expenses for the second quarter decreased by 17.8% to $51.8 million as we continue to manage our expenses. Selling and marketing expenses were down approximately 24.2% to $23.1 million, reflecting lower personnel-related expenses, including share-based compensation, lower sales commission, marketing, training, and events expense. R&D expense was roughly flat at $1.3 million, while G&A expense was $27.5 million, down 12.6% year -over -year, driven by lower personnel-related spend and bad debt recoveries. These factors led to an operating loss of $2.7 million in Q2 2025, an improvement versus a loss of $22.1 million in the comparable prior year. Adjusted EBITDA of $13.9 million was above our implied guidance, reflecting lower operational spend and higher gross margin. Moving to the balance sheet, we ended the quarter with $212 million in cash and equivalents, down from $370 million at year-end 2024. This decline primarily reflects the completion of our convertible note exchange, in which we repurchased approximately $20 million in principal and exchanged a total of $413 million of 2026 notes for a combination of cash and $250 million in new 7.95% secured notes due in 2028. This transaction meaningfully extends our debt maturity profile and enhances our long-term financial flexibility. In addition, we incurred typical working capital and restructuring investments as we continue executing on our transformation strategy. Inventory declined to $59.2 million from $69.1 million at year-end, demonstrating improved demand planning and supply chain efficiency. Additionally, we continue to make progress on selling through our Elite fair market value devices. We now have 235 devices remaining and expect to sell the remaining units this year. As previously stated, our U.S.-based manufacturing footprint is fully operational and remains a strategic advantage geared toward enhancing quality, increasing agility, and helping mitigate tariff exposure in the U.S., which we are projecting to be approximately $4 million for the remainder of the year. We took an average overall price increase of nearly 5% across our consumables portfolio effective July 3rd. This marks our first price increase in three years. We had factored this increase into our budget and for the full year 2025. As a result, this is already included in our 2025 guidance. I'll now turn the call back to Marla. We delivered a strong second quarter marked by disciplined cost management, expanding profitability, and solid execution. With healthy margins, a high-quality recurring revenue base, and greater financial flexibility, we're well positioned to drive long-term value. With that, we'll open the line for questions. Operator? Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. The first question comes from the line of Allen Gong with JPMorgan. Please go ahead. Thanks for the question and congrats on the good quarter. I guess when I look at your guide, you know you're raising the bottom end after maintaining after a good first quarter. You've had another good quarter. When I look at your third quarter guide, it looks, you know, fairly cautious, right? I guess there's some seasonality in there. Given the momentum you have, given easy comps, what are you seeing in July and August? How does that factor into your confidence in the guide? Hi, Allen. Thanks for the question. I'm going to have Mike answer that. Hi, Allen. Let me address the second half of the guide more specifically, because it's really driven and includes the third quarter. It's driven by three factors. The first is we're projecting revenue, the year-over-year trends to be down similar to what we saw in the first half. It's mainly driven by the switch to China, along with the current trends we're seeing. We're expecting to see more ASP pressure in the back half of the year. That's really putting some overall pressure on revenue and pressuring in the near term the gross margin. The second piece relates to gross margins. It's projected to be down in the second half versus the first half due to overall ASP, primarily because we're selling more Elite and Syndeo factory-refurbished devices, because they're more accessible and providers are taking advantage of that price point. Additionally, we're still projecting most of the tariff impact that I mentioned of $4.5 million to impact the back half of the year in both the third and fourth quarter. We're hopeful that ends up being conservative, but we've been managing through that and still are leaving that in the guide. The third piece is we're making some meaningful R&D investments in the back half of the year. Approximately, it's $4- $5 million. That's mainly to support launches late in 2025 and in 2026 around both consumables and devices. Got it. Thanks. I guess a follow-up just on the installed base. You added a net, or I guess gross, you were able to place a good number of systems in the quarter. Obviously, that's what helped drive the total system sales upside. Your installed base grew significantly less, implying that a lot of those systems that you sold were upgrades or replacements or churn, I suppose. What drove that relative to the trends that we've been seeing in other quarters? Thank you. We had device sales continue to be pressured because of the macro environment that we've seen and interest rates. Churn was a little bit higher in the second quarter than we've seen in the past. That's been the last couple of quarters. It's not occurring in any one channel over another. It's spread across both medical and non-medical. We're in the process now of developing an action plan, and we're reaching out to those providers with the expectation to reverse some of those trends in the back half of the year. Mr. Gong, are you done with the question? Yes, I am. Thank you. Thank you. Next question comes from the line of Jon Block with Stifel. Please go ahead. Hey, everyone. This is Joe Federico on for John. Thanks for taking the question. I guess I'll just maybe try to get a little more detail on the EBITDA dynamics in the guidance in the back half of the year. I think, Mike, you just touched on it. You've done roughly $21 million year to date, and then at the midpoint of the updated guide, it implies $10 million in the back half. Is that step down just the combination of the tariff headwinds that you just outlined and the increased R&D spend? Any more color other than that would be great. It's the combination of both of those and the assumption around product mix, specifically how we're continuing to project increased sales around factory-refurbished Sindeos and Elites that's pressuring gross margin as we move through that product and clear it out of our inventory. Okay, got it. That's helpful. Maybe just one more on EBITDA. I mean, gross profit on a dollar basis was essentially right in line with our estimate for the quarter, but EBITDA obviously came in well ahead of us, a very solid quarter. I think you outlined some of the areas of OpEx that may have accounted for the difference, mainly sales and marketing. Is there any additional specific actions you're taking that you can highlight? What's kind of the run rate that we can expect there going forward? Yeah, if you look at sales and marketing, it was a big piece of the driver of OpEx savings. G&A was also lower. If I speak about G&A for a minute, we've had initiatives over the last year and a half where we're really trying to control G&A costs. Additionally, we've had some bad debt recovery that's helped as we collect on some of our past due accounts that we previously had to reserve for. We reversed some of that out in G&A. Sales and marketing in particular is the largest driver, as you mentioned. A lot of that is our sales and marketing team is really focused on making sure that they get an ROI for the spend that they're deploying. We've been cautious around deploying that spend to make sure that it's really driving new leads, helping with lead conversion, and expanding the overall Hydrafacial brand to the end consumer to drive traffic. That's what's driving it. When you think about the future costs, I would expect it to stay, the sales and marketing line in terms of dollars, very similar to what we did in the second quarter. Second quarter GAAP number was low $23 million. I would expect for the rest of the year we tend to be around that same range, $23 million, $24 million of spend for the back half of the quarter. The percentage just moves around based on the seasonality of the revenue. Very helpful. Thank you. Thank you. Next question comes from the line of Oliver Chen with Raymond James & Associates. Please go ahead. Hi, Marla and Michael. As we look forward with delivery systems, what do you think it takes to grow positively there? Will the comparative ease enough and the changes in Asia also ease such that you can get positive, consistent growth? Any thoughts around that? Also, as we think longer term about consumables, what are your thoughts on the long-term growth rates here? The regions, you spoke about the regions at length. I think there's quite different things happening in Americas versus Europe. If you could comment on the consumers and the macros there and how that's interplaying with your numbers, that would be helpful too. Thank you. Hi, Oliver. Thank you for the questions. I'll start and then I'll have Mike add in. In terms of device sales and device execution, we're acutely focused on driving device sales. Our team has a very ambitious customer engagement program that's being implemented across the globe with regards to leads and pipeline management to really accelerate device sales. We think while we're disappointed in the numbers, we think we have a good plan to get to where we want to be. In terms of consumable sales, we're excited about where we are and excited about the future. They were slightly positive year on year, but when you take out China, consumable sales increased 5.3%. In terms of the non-APAC markets, our signature treatments were stable. We're seeing incredible booster adoption. In fact, our global booster revenue grew double digits this year. We feel very strongly about our consumable sales future. With the addition of additional launches, backbar, and skincare, that is really an area where we see growth for the company. I'll let Mike take the rest of the question. I think you covered most with the exception of regional questions. On a regional basis, you know we're seeing similar declines on equipment. The themes are, if you look in EMEA versus the Americas, separate and leaving APAC out, we're seeing similar kind of pressure points and percentage pressure year -over -year. On consumables, EMEA did particularly well in growing consumables year -over -year. They grew the consumables business well into the double digits. What we're seeing there is strong execution. That particular region focuses in on the medical channel, and they're seeing good traction there. Marla, there are prudent changes you're making to the sales organization. What are your thoughts on timing or what should we expect in terms of timing of that driving, helping drive positive growth there? How do you disaggregate, I guess, what's happening in the backdrop with the macros with delivery systems relative to what seems like solid execution? Are Are you on your way? Yeah, it's a good question. The macro still pressures, and it's mainly because of the uncertainty in the market, right? Which is just uncertain with where tariffs are going, where the economy is going. I think once we get through that, we feel good. Our team is executing well. We have a lot of new leaders on the team, and we're really excited. We can't predict exactly when it will turn, but we're excited about the team and the initiatives they are implementing right now and implementing in the back half of the year. Okay. Michael, as marketing and demand creation as a percentage of sales or dollar, what's the outlook and framework and timing of how that makes the most sense to optimize against changes and such? Is your question more specifically on kind of how we think about sales and marketing as a percentage of revenue in the guide? Yeah, both. I think if there's any other strategy thoughts too that's relevant to modeling that and also the changes underway, that could be helpful as well. Yeah, I think the selling and marketing line, we were a little under 30% of revenue in the second quarter. I would expect that to increase, but the dollar amount to stay relatively stable. It's increasing because of the seasonally low revenue in the quarter. I would expect that to come back down into kind of the 30%- 31% range, give or take, in the fourth quarter. One of the important things about what we're seeing in sales and marketing, if you take the sales component, obviously our sales team, large expense that runs through that is around kind of commissions. It's a variable cost that runs through that line. When you look at the marketing spend, that's where our marketing team is very disciplined around deploying money to bring in more leads. They measure the effectiveness of those leads. As they're effective, we're willing to deploy more money back into that line to drive revenue. If not, then we end up pulling back on some of the marketing costs until we see an appropriate ROI. Strategically, our marketing team is acutely focused on the provider and where the patient or consumer is. Over the last year, we've really shifted into allocating more dollars over to provider marketing relative to consumer marketing. We do think the launch of backbar and skincare will halo over all of our marketing for both provider and consumer. Thank you. The last follow-up was innovation sounds exciting as well as R&D. There was previously thinking around exosomes as well as a really good hair product. What's on your mind, as you mentioned, R&D and investing there? Thanks a lot. Best regards. Yeah, I think in terms of R&D, we're investing in consumables innovation and device innovation. You'll hear more about specific categories as we get closer to launching each product. The categories you're talking about are compelling. We see exosomes as a long-term opportunity. We also see hair and our Keravive treatment as a long-term opportunity for investment. Thank you very much. Thank you. Next question comes from the line of Bruce Jackson with The Benchmark Company. Please go ahead. Hi, good afternoon, and thank you for taking my questions. Just to follow up on that last one, you've spoken about the importance of keeping up a new product cadence. When's the next booster or new product expected to launch? We will be launching Hydrafacial Backbar and a hero skincare SKU in the fourth quarter of this year, followed by a significant expansion in both those categories in 2026. The booster cadence, we think one to two a year is the right cadence. If you look, I think the company did a lot more previously, but we really need time to get the full benefit of each launch. We're still picking up penetration from the Hydralock HA launch, which was from last year. We think this strategy of really leaning into launches over a long period of time to get the full adoption makes the most sense. Okay, that's helpful. One follow-up, if I may. Looking at the other income, with the refinancing of the debt, are there going to be any changes to your net interest expense or net income, other income lines going forward? Yes. We restructured our debt where we had $557 million of debt at the end of last quarter. We pushed out, we refinanced $250 million from 2026- 2028. That interest rate is a little bit below 8%. You're going to see more expense run through interest expense starting this year and into next year based on the $250 million new notes. Okay. All right. That's it for me. Thank you. Thank you. Thank you. Next question comes from the line of Olivia Tong with Raymond James. Please go ahead. Great, thanks. Good afternoon. I want to start with the consumable price increase that you talked about. Could you tell us when you did, when you implemented that, what's been the feedback from your esthetician and your view on demand elasticity? Does this cover the tariff pressure or is there more that needs to be done with productivity or other offsetting measures to offset the headwind? Thank you, Olivia. We implemented the price increase on July 3rd. Honestly, we were a little worried about the reaction, but apparently there were quite a bit of price increases put into the medical aesthetics channel at around the same time that were much higher than ours. We really didn't get any feedback on any issues around our price increase. Mike, do you want to talk about the tariff headwinds and how we're thinking about that? Sure. Yeah, Olivia, obviously the price increase helps and it's a partial offset to some of those, to some of the tariffs. We're still projecting kind of $4 million of expense in the back half of the year. Our hope is that that ends up being conservative. We've been able to kind of manage through that. It's largely from purchases from APAC for the consumables piece of our business. Got it. Can you talk about what drove the higher churn versus your expectations? Does that continue to contribute in the second half? Yeah, it's a good question. We're looking into the churn. As I said earlier, it's not in any one particular area. It cuts across both medical and non-medical. I haven't seen anything in the data that shows any one specific item. The short answer is we're still looking into the specific customers and reaching out. We're pretty optimistic that we can reactivate some of these customers with some very targeted initiatives. We'll keep you posted on that. Thank you. Next question comes from the line of Sydney Wagner with Jefferies. Please go ahead. Hi, thanks for taking our question. Just wondering if you can give a little bit more color on the variability of performance between provider channels or provider types. Thank you. Yeah, happy to talk a little bit about that. We saw some nice growth in the non-medical channel this quarter, especially among single-room SDs and day spas. That was exciting to see given that our Good, Better, Best strategy was really designed to expand the market. I think with our Elite factory-refurbished devices and other more accessibly priced devices, the market felt comfortable buying in. Really nice growth in that sector. In terms of the medical and med spa, we continue to feel good about the potential there. A lot of them are incredibly excited about the Hydrafillic Booster launches and our more clinically backed booster strategy. We had great adoption within that channel. Miss Wagner, are you done with the question? Yep, that's it. Thank you. Thank you. Next question comes from the line of Susan Anderson with Canaccord Genuity. Please go ahead. Hi, good afternoon. Alec Legg, I'm for Susan. Thanks for taking our question. On the consumables, I think I heard, did you say that consumables was up 6% excluding Sephora? When should we expect that headwind to roll off? Consumables are up 5.3% excluding China. That's big because as we moved from a direct model to a distributor model, the business in China is going through a transition period. That's one of the key pieces. I think in the U.S., the 6% was referenced around our U.S. national accounts. In particular, Sephora we're no longer in anymore. When you factor that out, we saw national account growth in the U.S. grow the 6%. Got it. On the China distributor transition, how should we think about the ASPs across both the equipment and the consumables business? Is the current rate the right way to think about it, or will there be more pressure in the back half? We factor that in. In our distributor business, it tends to be we have different agreements. Think about it on average in terms of it's usually a 30%- 40% discount to the product. We don't obviously have the OpEx that kind of comes through. For the guide this year, the distributor that we partnered with in China is focused on mainly servicing the existing providers that are in China and making sure that transition goes effectively, goes smoothly. We didn't factor in a significant amount of growth in China this year. We kind of view it as a transition year. As we move into next year, you'll start to see the distributor model and those economics where there's a discount kind of play through where it's lower gross margin, lower gross profit, but very, very minimal OpEx to drive kind of EBITDA. Very helpful. Thank you. Nice job. Thank you. Next question comes from the line of Navann Ty with BNP Paribas. Please go ahead. Hi, thank you. Sorry if I missed it, but could you discuss the general trends across the med spa, plastic and derm channel in the US this quarter? Are you seeing end consumer weakness in the low end of the market, or is that still in luxury treatments? Yeah, it's a good question. Thank you so much. The specialty facial category is still very strong in medical aesthetics. I think our consumable sales really reflect that consistent consumer demand, and our growth in consumables is showing that. I think what we're seeing is with our providers, you know, which include med spa, doctor's office, and large U.S. chains, they're really driving and utilizing Hydrafacial as a traffic driver. Some of our top U.S. national accounts with large footprints are even seeing double-digit growth. What's helping that is our cadence of booster launches, which are driving attention on the part of the providers and the aestheticians and interest on the part of the end consumer into having additional Hydrafacials. Just the significant booster revenue growth is showing the value of our higher-end treatments to the consumer. We feel good about the category we're in. I think what happens if there's any sort of slowing of patient spend at the more expensive treatments, the med spas use Hydrafacial to get the patients and consumers in so they can try to upsell them to other treatments. The trends we're seeing with treatment stacking and, you know, prescribing Hydrafacial before other treatments is really compelling. Thank you. That's very helpful. I don't understand the 2026 loyalty program, at least broadly. How will that be structured versus other aesthetics companies' programs? Yeah, I think, you know, for us, what we are doing is really simplifying our program and adding more incremental levels to really add more perks and benefits for our base and for our provider base. Currently, 93% of our providers are in our program, and we're really leveling up. We're also relaunching it to prepare for skincare and backbar so that we can add additional benefits for buying into those programs. For us, it's really about simplifying and then preparing the program so that we can add additional benefits. Thank you. Thank you. This concludes our question and answer session. I would like to turn the conference back over to Marla Beck for closing remarks. Thank you all for joining today, and thank you to The Beauty Health Company and Hydrafacial team for everything you do and your hard work on execution this quarter. Thank you. Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.