Good afternoon, everyone, and welcome to the Tilly's fourth quarter and full year 2025 earnings conference call. All participants will be in a 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. Please note that today's event is being recorded. At this time, I'd like to turn the floor over to Gar Jackson with Investor Relations. Please go ahead. Good afternoon, and welcome to the Tilly's fiscal 2025 fourth quarter earnings call. Nate Smith, President and Chief Executive Officer, and Michael Henry, Executive Vice President and Chief Financial Officer, will discuss the company's business and operating results and then host a Q&A session. For a copy of Tilly's earnings press release, please visit the investor relations section of the company's website at tillys.com. From the same section, shortly after the conclusion of the call, you'll also be able to find a recorded replay of the call for the next 30 days. Certain forward-looking statements will be made during this call that reflect Tilly's judgment and analysis only as of today, March 11, 2026, and actual results may differ materially from current expectations based on various factors affecting Tilly's business. Accordingly, you should not place undue reliance on these forward-looking statements. For a more thorough discussion of the risks and uncertainties associated with any forward-looking statements, please see the disclaimer regarding forward-looking statements that is included in our fiscal 2025 fourth quarter earnings release, which is furnished to the SEC today on Form 8-K, as well as our other filings at the SEC referenced in that disclaimer. Today's call will be limited to one hour and will include a Q&A session after our prepared remarks. I will now turn the call over to Nate. Thank you, Gar, and good afternoon to everyone joining us today. We finished fiscal 2025 surpassing our expectations on both the top line and bottom line for the fourth quarter relative to our outlook provided in early December. We ended the fiscal year with six consecutive months of accelerating positive comp momentum and 18 consecutive positive comp weeks. That momentum drove our first profitable fourth quarter and first positive comp sales fiscal year since fiscal 2021. Our momentum has continued to start fiscal 2026 with a +20% comparable net sales result in February. We have meaningfully improved our merchandise assortments and evolved our brand and digital marketing efforts to improve our customer engagement. Additionally, we have closed underperforming stores and sustained solid operational execution, delivering significantly improved results compared to last year. From a merchandising perspective, we began fiscal 2025 looking to reinvigorate our brand mix and to clean up excess aged inventory. With each passing quarter, our comparable net sales results and product margins improved as these changes were being made, ultimately leading to comp sales growth throughout the second half of fiscal 2025, which is momentum we are carrying into early fiscal 2026. Our merchandising teams put in a lot of effort to make the necessary changes to drive these improved results, and I'm confident in their ability to drive further improvements in fiscal 2026. I'd especially like to acknowledge Michael Cingolani, who we just promoted to Chief Merchandising Officer, for his leadership and tireless efforts in turning our sales trajectory around over the past year and setting us up for such a strong start to fiscal 2026. Good product offerings need to be supported by effective marketing strategies and tactics to help new customers realize who we are and what we have to offer, to update existing customers on changes we have made, and to reintroduce Tilly's to former customers who may have disengaged from our brand. We believe our marketing team's efforts to drive greater consumer awareness and consideration for Tilly's have made a significant impact through engaging campaigns, refreshed content, and exciting events, as evidenced by our growing TikTok following and reversing declines in our active customer loyalty program membership. These efforts will continue in various ways throughout fiscal 2026 to build upon the successes achieved in fiscal 2025. In terms of store real estate, with the improved store comp trends we've seen over the last seven months and counting, and because our unit economics support it, we are now pivoting from a store closure posture to a disciplined approach to new store openings in fiscal 2026, with a plan to open four-six new stores. We will remain selective and reasonably conservative in our future expectations for new stores, but it is encouraging to reach an inflection point of feeling the confidence to begin strategically considering store growth again. Fiscal 2025 was a year of significant store optimization, resulting in 21 total store closures. We are proud of the fact that we were able to deliver sales growth in the fourth quarter with 17 fewer net stores. At the present time, we have four known store closures that will take place late in the first quarter, and while that number may change as the year progresses, we do not currently expect to close a significant number of additional stores this year. Our infrastructure investments and a price optimization tool during the second half of fiscal 2025 and in warehouse management software in mid-fiscal 2024 have now been producing the anticipated benefits we expected. Our price optimization tool has contributed meaningfully to our improved fourth quarter product margins. The new warehouse system is now helping drive significant labor efficiencies within our store and e-com distribution centers. Further investments in our business are expected to continue during fiscal 2026, including an AI-driven merchandise allocation tool that we believe will lead to greater operating efficiencies over time. In closing, we are very excited about our prospects for fiscal 2026. We believe our turnaround is real. The fundamentals are fixed. Our top line is growing. We are looking to reinitiate store growth. We must continue to build upon the progress made thus far. The team has done the hard work, now we're optimizing. We are not yet profitable on an annualized basis, but we see a clear path to get there after generating profit in two of the last three quarters. We built forward momentum in our business throughout fiscal 2025, and that momentum has carried into an unprecedented start to fiscal 2026. Given current trends, we expect to deliver further improvement in both top line and bottom line performance in each quarter of the year. We look forward to discussing our progress with you as the year progresses. I will now turn the call over to Mike to share the details about our fiscal 2025 fourth quarter operating results and to introduce our fiscal 2026 first quarter outlook. Thanks, Nate. We finished fiscal 2025 with stronger sales and product margins than we anticipated, along with lower expenses to achieve our first profitable fourth quarter since fiscal 2021. Details of our fourth quarter operating results compared to last year's fourth quarter were as follows. Total net sales of $155.1 million increased by 5.3% despite finishing fiscal 2025 with 17 fewer stores than a year ago. Comparable net sales for the 13-week period ended January 31, 2026, including both physical stores and e-com, increased by 10.1%, with increases from both physical stores and e-com of 10.3% and 9.8% respectively. That strong fourth quarter comp performance was enough to pull our full-year comp sales slightly positive for the first time since fiscal 2021 at +0.3%. Total net sales from physical stores increased by 3.6% despite our 7.1% reduction in year-over-year store count. Net sales from physical stores represented 72.3% of total net sales compared to 73.5% last year. E-com net sales represented 27.7% of total net sales compared to 26.5% last year. Gross margin, including buying, distribution, and occupancy expenses, increased to 33.2% of net sales, an improvement of 720 basis points compared to 26% of net sales last year. Product margins improved by 470 basis points as a result of higher initial markups and lower total markdowns associated with operating with reduced and more current inventories than a year ago. Buying, distribution and occupancy costs improved by 250 basis points or $1.9 million in the aggregate, primarily due to lower occupancy costs associated with our reduced store count and partially offset by increased shipping costs associated with our online net sales growth. Total SG&A expenses were $48.9 million or 31.5% of net sales, a reduction of $3.5 million or 410 basis points as a percentage of net sales compared to $52.4 million or 35.6% of net sales last year. Significant SG&A reductions compared to last year's fourth quarter were attributable to store payroll and related benefits of $1.6 million, primarily related to our reduced store count, lower non-cash impairment charges of $0.7 million, reduced e-com fulfillment labor of $0.7 million and a variety of smaller reductions across several line items. Operating income improved to $2.6 million or 1.7% of net sales from an operating loss of $14.1 million or 9.6% of net sales last year. Income tax expense was $18,000 or 0.6% of pre-tax income, compared to $0.2 million or 1.8% of pre-tax loss last year. Both years include the continuing impact of a full non-cash valuation allowance on our deferred tax assets. Net income improved to $2.9 million or $0.10 per diluted share, compared to a net loss of $13.7 million or $0.45 per share last year, representing an improvement of $16.6 million or $0.55 per share versus last year's fourth quarter. Turning to our balance sheet, we ended fiscal 2025 with total liquidity of $87.8 million, comprised of cash of $46.3 million, no debt, and available borrowing capacity of $41.5 million under our asset-backed credit facility. Net inventories were 10.8% lower, with an improved inventory aging compared to a year ago. Total capital expenditures for fiscal 2025 were $4.7 million compared to $8.2 million in fiscal 2024. Turning to the first quarter of fiscal 2026, comparable net sales for the first month of the year ended February 28, 2026 increased by 20.1% relative to the comparable period of 2025. Based on current and historical trends, we currently expect the following for our fiscal 2026 first quarter operating results. Total net sales to be in the range of approximately $119 million-$125 million, translating to a comparable net sales increase of 16%-22% respectively. We currently expect to generate product margin improvements of approximately 310-330 basis points compared to last year's first quarter. SG&A to be approximately $44 million-$45 million before factoring in any potential non-cash store asset impairment charges which may arise. Pre-tax loss and net loss to be in the range of approximately $10.1 million-$8 million respectively, with a near zero effective income tax rate due to the continuing impact of a full non-cash valuation allowance on our deferred tax assets. Loss per share to be in the range of $0.34-$0.27 respectively, compared to a loss per share of $0.74 in last year's first quarter, with estimated weighted average shares of approximately 31.1 million. We currently expect to end the first quarter with 220 total stores, a net decrease of 18 stores or 7.6% from the end of the first quarter of fiscal 2025. We are not in a position to provide annual guidance, given we cannot predict our comparable net sales performance for the balance of the fiscal year with any certainty. However, for illustrative purposes regarding our potential to return to profitability in fiscal 2026 and subject to various assumptions with respect to product margins, inventory levels, and expenses, we estimate that it would take an annualized comparable net sales increase of approximately 8%-9% to begin generating profitability for fiscal 2026 as a whole. In closing, as Nate noted earlier, we are optimistic about our prospects in fiscal 2026 based on the sequential improvement in our comparable net sales trend we achieved from quarter to quarter throughout fiscal 2025 and into our strong start to fiscal 2026. Operator, we'll now go to our Q&A session. At this time, we'll begin that question and answer session. To ask a question, you may press Star and then one. To withdraw your questions, you may press Star and two. If you are using a speakerphone, we do ask that you please pick up the handset prior to pressing the keys to ensure the best sound quality. Again, that is Star and then one to ask a question. Our first question today comes from Matt Koranda from Roth Capital. Please go ahead with your question. Hey, guys. Nice work in the quarter. I guess first off, just curious about the composition of the strong comp for the fourth quarter in particular. It looks like it based on the comments from the last time you guys gave public commentary, it probably accelerated in December and January. Wanted to hear about sort of the acceleration in comp, but also if you can break down traffic versus ticket for that period, that'd be helpful as well. Sure, Matt. So you know, going back to the beginning of the third quarter, we did a +1% in August, +1% in September, +6% in October, then a +8% in November, +10.6% in December, +12.4% in January. As we just said, a +20.1% in February. March is off to an even stronger start than that so far. Really significant acceleration in our comp sales trend from month to month, on top of the quarter to quarter performance we were achieving, throughout fiscal 2025, from Q1 through Q4. Just really, really excited to see this kind of performance. Our conversion rate has been super strong. It's been high teens, double-digit% increase compared to last year. Traffic has been improving, both stores and e-com performing, all departments positive. You know, pretty much everything is moving in a favorable direction. Got it. Okay. Good to hear. I guess just wanted to hear a little bit about what you think is working in the assortment. Obviously, really strong acceleration all the way through the February commentary you gave, and it sounds like March sounds pretty good. What's working? What do you think is kinda driving higher traffic? You know, is there something in the assortment in particular, or is it a better marketing posture? Maybe just help us identify kind of the big levers you've pulled. Yeah. Thanks, Matt. This is Nate. Mike and I were talking last night about this and, you know, we were constructing what we figured this question would come. It really is across every category. We're not seeing any spike in any particular category. We're seeing strength across the board, both genders and kids. You know, I think obviously our private label is working as well. I think, you know, when we think about what was causing some of our struggles, it started with the assortment. We feel very strongly now our assortment across the board, across all categories is where it needs to be. We mentioned Michael Cingolani coming in and taking charge of that and now being promoted to the CMO role. I think that was a huge component of it. It's also, you know, the inventory situation was addressed too. Now we're selling far more full price than we were, you know, say a year ago, that we were selling a lot of off price with aged and obsolete inventory. So our inventory levels are healthier, our assortment is stronger. You know, we've obviously rationalized some of our underperforming store. You know, the consequence of all that is now really healthy margins. Okay. All right. That's helpful. Thanks, Nate. On the store openings, it sounds like you're telegraphing, you know, net opener of stores this year, considering the four to six you mentioned in terms of opens and only a handful of closures near term. What determines the path forward on further expansion, I guess? Maybe just help us understand where your head's at on store expansion over maybe the medium to longer term. What are we factoring in maybe for Mike on CapEx for the store expansion this year? To your first question, Matt, you know, I think what we feel good about our unit economics. We feel good about our ability to execute. You know, for me, it's more the consumer spending environment in the long term. You know, if the macro does turn against discretionary retail spending, certainly double-digit comps will become harder to sustain, no matter how well we execute. You know, largely speaking, I'd say we're leaning into it this year and can only expect to be more aggressive in 2027 the way we're viewing our business today. Yeah. In terms of total CapEx, we don't expect our CapEx to reach $10 million in the aggregate. It's been less than that each of the last two years, as we noted in our prepared remarks. It should be in a similar neighborhood. I'd say not more than $8 million -$9 million would be our expectation as we sit here today. You know, look, we're still on the path of recovery. We struggled a lot in the first half of 2025. We've lost a lot of productivity in terms of sales per sq ft, finishing fiscal 2025 with- Ladies and gentlemen, we seem to be having a technical difficulty with the main speaker line. Please stay on the line. We'll be reconnecting here momentarily. Again, we do apologize for the audio break. We are reconnecting Mr. Henry's line. One more moment. We should have him back on the line for you. Thank you. This is the conference operator once again. We've reconnected Michael's line into the conference. Michael, we still have Matt on the line for you. Great. If you would like to continue with the Q&A. Yeah. Sorry about that, everybody. We had some sort of technical glitch happen here that booted us out of the line. Apologies for that little hiccup. We're back. Hey, can you guys hear me, by the way? Yes, we can hear you. Yes. Can you hear us? Yes. Oh, okay. Sir, we- Cool. We can hear you. All right. Got it. Just wanna make sure. I think, Mike, you may have kinda dropped off when you were talking about CapEx for stores, probably no greater than $8 million-$9 million, and then you started getting a little choppy. Maybe if you wanna finish the commentary around that'd be helpful. Yeah, I started talking about our sales per sq ft. We're ending fiscal 2025 at roughly $260 per sq ft, which is still well below where we've been as a business in the past. We would expect ourselves to continue to improve on that metric. As we do, we'll continue to give us greater confidence in even expanding the rate of store expansion that we've noted for this year to even higher levels in future years, which is what we would expect to be able to do. Lots of room yet to continue to improve this business. We struggled a lot through fiscal 2022, 2023, 2024, first half of 2025, and we're just beginning to regain that lost ground that we struggled with for that three-four-year period. You know, we'll walk before we run. We'll continue to be reasonably conservative in our expectations for new stores. They have to be at the right economics. It's nice to reach this inflection point where we're starting to look ahead and feel confident about our ability to reinitiate growth. Okay, great. Maybe just last one from me. It was helpful to hear the commentary on sort of the zone in which you'd be profitable from a comp perspective. Just curious if there's any other assumptions that we should be embedding in that profitability outlook or hypothetical, I guess, profitability outlook. Is there more gross margin leverage embedded in that assumption with an 8%-9% comp? Is there more you can do on SG&A expense that kinda gets you to the break-even line, or is it just a simple sorta comp assumption you're making? No. Good question. Mike talked about, you know, the sales per square foot, which is we have targets we wanna hit. You know, on the other side of that, we're really on the efficiency journey now, is what we're calling it. You know, we see a clear path with things like our price optimization tool, where we will continue to see margin upside. We've got our AI solution to planning and allocation rolling out here latter part of this year with Impact Analytics. We'll be launching RFID latter part of this year, which will give us obviously better inventory accuracy, resulting in a reduction of stock-outs. It'll also cut our manual inventory counting time by probably 80%-90%. And we've got a series of back-end efficiency projects as it relates to all of our product handling and fulfillment processes, to include store labor efficiency, which is another work stream we've got underway. We're approaching this from both sides, not only sales per sq ft, but what we would consider to be efficiency on the back end. Yeah. Just to add on to that, you know, an 8%-9% comp increase does not correlate to a proportionate increase in SG&A to the efficiency comments that Nate's making from a variety of angles. The aggregate increase in SG&A, despite continuing minimum wage increases and other cost pressures, would not cause SG&A in the aggregate to go up as much as you might expect with an 8%-9% comp. Okay. We do also expect to continue to improve product margins this year, more in the front half of the year than in the back half of the year. If you follow the cadence of our product margin improvement that we achieved each quarter, through fiscal 2025, we're still gonna have a meaningful amount in Q1. It'll start to moderate but still be triple digits in Q2 if all goes as planned, and then it would more moderate in Q3 and Q4. That makes sense. Thanks, Mike, and I appreciate it, Nate. Ladies and gentlemen, at this time, seeing no additional questions, I'd like to turn the floor back over to management for any closing remarks. I'd just like to say thank you for joining us today, and we look forward to sharing our fiscal 2026 first quarter results with you in early June. Have a good afternoon, have a good evening. With that, everyone, we'll be concluding today's conference call and presentation. We do thank you for joining. You may now disconnect your line.