Core Viewpoint - Champion Homes, Inc. is set to release its earnings results for the second quarter of fiscal year 2026 on November 4, 2025, after market close [1] Company Information - The earnings results will be discussed in a conference call scheduled for the following morning, November 5, 2025, at 8:00 A.M. Eastern Time [1] - Interested investors and parties can access the live conference call via a webcast on the Investor Relations section of the company's website [1]

Core Viewpoint - Champion Homes, Inc. is donating the value of a modular home to Greater Cleveland Habitat for Humanity to support the construction of affordable homes in Cleveland [1] Company Summary - Champion Homes, Inc. emphasizes its commitment to building high-quality, affordable homes through offsite construction methods [1] - The company's President and CEO, Tim Larson, highlights the significant need for affordable housing in the area [1] Industry Summary - The collaboration with Greater Cleveland Habitat for Humanity reflects a growing trend in the industry towards partnerships aimed at addressing housing affordability [1]

Core Insights - Harmonic has partnered with SKY Perfect JSAT Corporation to modernize its broadcast playout and delivery workflow, utilizing Harmonic's XOS Advanced Media Processor to enhance video quality and explore new business models for revenue growth [1][2]. Company Overview - Harmonic is recognized as a leader in virtualized broadband and video delivery solutions, enabling media companies to provide ultra-high-quality video streaming and broadcast services globally [4]. Technological Advancements - The XOS media processor features a cloud-native software foundation and a complete playout-to-delivery feature set, which consolidates critical broadcast functions into a single solution, enhancing operational efficiency and delivering substantial cost savings [2]. - The XOS media processor provides a 40% improvement in density compared to the previous platform, driving performance gains for SKY Perfect JSAT [2]. Market Positioning - The collaboration with SKY Perfect JSAT is seen as a strategic investment in software-centric solutions, allowing the company to expand into new market segments and launch targeted services [3].

Core Insights - Southwest Airlines and T-Mobile have announced a partnership to provide free unlimited WiFi for all Rapid Rewards Members starting October 24, 2025, marking their first collaboration [1][2][3] Company Overview - Southwest Airlines operates over 800 aircraft and will be the largest domestic airline to implement free WiFi on every flight in 2025 [2] - The airline has a strong customer loyalty base, carrying over 140 million customers in 2024 and employing more than 72,000 people as of June 30, 2025 [5][8] Customer Experience - The partnership aims to enhance the customer experience by providing seamless in-flight connectivity, with free WiFi available for all Rapid Rewards Customers regardless of their wireless provider [2][4] - Customer satisfaction scores from recent tests of free fleetwide WiFi were strong, indicating a positive reception among users [4] Strategic Goals - The initiative is part of Southwest's ongoing commitment to improve the cabin experience, with free WiFi being one of several enhancements planned for the future [3][4] - T-Mobile has been a leader in providing free inflight connectivity since 2014, and this partnership expands their reach to millions more travelers [3]

PART I – FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Presents Champion Homes' unaudited condensed consolidated financial statements, including balance sheets, income statements, cash flows, and detailed notes [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20as%20of%20June%2028,%202025%20(unaudited)%20and%20March%2029,%202025) | Metric | June 28, 2025 ($ thousands) | March 29, 2025 ($ thousands) | | :-------------------------------- | :-------------------------------------- | :--------------------------- | | Cash and cash equivalents | 605,327 | 610,338 | | Total current assets | 1,115,477 | 1,086,498 | | Total assets | 2,149,251 | 2,110,408 | | Total current liabilities | 465,988 | 451,308 | | Total long-term liabilities | 112,786 | 114,662 | | Total stockholders' equity | 1,570,477 | 1,544,438 | [Condensed Consolidated Income Statements](index=5&type=section&id=Condensed%20Consolidated%20Income%20Statements%20(unaudited)%20for%20the%20three%20months%20ended%20June%2028,%202025%20and%20June%2029,%202024) | Metric | Three months ended June 28, 2025 ($ thousands) | Three months ended June 29, 2024 ($ thousands) | YoY Change (%) | | :--------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :------------- | | Net sales | 701,318 | 627,779 | 11.7% | | Gross profit | 189,830 | 164,215 | 15.6% | | Operating income | 78,521 | 55,388 | 41.8% | | Net income attributable to Champion Homes, Inc. | 64,687 | 45,794 | 41.2% | | Basic EPS | 1.13 | 0.79 | 43.0% | | Diluted EPS | 1.13 | 0.79 | 43.0% | [Condensed Consolidated Statements of Comprehensive Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(unaudited)%20for%20the%20three%20months%20ended%20June%2028,%202025%20and%20June%2029,%202024) | Metric | Three months ended June 28, 2025 ($ thousands) | Three months ended June 29, 2024 ($ thousands) | | :--------------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Net income | 65,993 | 45,794 | | Foreign currency translation adjustments | 5,489 | (1,130) | | Total comprehensive income attributable to Champion Homes, Inc. | 70,176 | 44,664 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(unaudited)%20for%20the%20three%20months%20ended%20June%2028,%202025%20and%20June%2029,%202024) | Cash Flow Activity | Three months ended June 28, 2025 ($ thousands) | Three months ended June 29, 2024 ($ thousands) | | :-------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Net cash provided by operating activities | 75,302 | 84,616 | | Net cash (used in) investing activities | (33,864) | (9,082) | | Net cash (used in) financing activities | (51,864) | (20,604) | | Net (decrease) increase in cash and cash equivalents | (5,011) | 53,870 | | Cash and cash equivalents at end of period | 605,327 | 548,933 | [Condensed Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity%20(unaudited)%20for%20the%20three%20months%20ended%20June%2028,%202025%20and%20June%2029,%202024) | Metric | Balance at March 29, 2025 ($ thousands) | Net Income ($ thousands) | Common Stock Repurchases ($ thousands) | Foreign Currency Translation Adjustments ($ thousands) | Balance at June 28, 2025 ($ thousands) | | :-------------------------------- | :-------------------------------------- | :----------------------- | :------------------------------------- | :----------------------------------------------------- | :------------------------------------- | | Total Stockholders' Equity | 1,544,438 | 64,687 | (50,342) | 5,489 | 1,570,477 | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed explanations for financial statements, covering accounting policies, business operations, and specific items [1. Basis of Presentation and Business](index=9&type=section&id=1.%20Basis%20of%20Presentation%20and%20Business) - Champion Homes operates 42 manufacturing facilities in the U.S. and 4 in western Canada, 82 U.S. retail sales centers, and provides construction and transportation services[22](index=22&type=chunk) - During Q1 FY26, the Company idled production at its Bartow, Florida facility (**$1.0 million** costs) and plans to cease operations at its Kelowna, British Columbia facility (accrued **$2.9 million** costs)[27](index=27&type=chunk) - Floor plan receivables, primarily loans to independent retailers through Triad, totaled **$38.2 million** at June 28, 2025[29](index=29&type=chunk) [2. Business Combinations](index=11&type=section&id=2.%20Business%20Combinations) - On May 30, 2025, Champion Homes acquired Iseman Homes, Inc. for a total purchase consideration of **$26.9 million**, including **$24.6 million** in net cash paid[37](index=37&type=chunk) - The acquisition resulted in the recognition of **$5.5 million** in goodwill and **$2.9 million** for a trade name intangible asset[38](index=38&type=chunk)[41](index=41&type=chunk) - The pro forma impact of the Iseman Homes acquisition on revenue and net income is not material to the consolidated financial statements[42](index=42&type=chunk) [3. Inventories, net](index=13&type=section&id=3.%20Inventories,%20net) | Inventory Component | June 28, 2025 ($ thousands) | March 29, 2025 ($ thousands) | | :------------------ | :---------------------------- | :--------------------------- | | Raw materials | 111,247 | 110,755 | | Work in process | 33,788 | 31,079 | | Finished goods and other | 227,704 | 218,795 | | Total inventories, net | 372,739 | 360,629 | | Reserves for obsolete inventory | 11,000 | 11,100 | [4. Property, Plant, and Equipment](index=13&type=section&id=4.%20Property,%20Plant,%20and%20Equipment) | Metric | June 28, 2025 ($ thousands) | March 29, 2025 ($ thousands) | | :-------------------------------- | :---------------------------- | :--------------------------- | | Property, plant, and equipment, net | 317,037 | 307,140 | - Depreciation expense for the three months ended June 28, 2025, was **$9.0 million**, up from **$7.7 million** in the prior year period[44](index=44&type=chunk) [5. Goodwill, Intangible Assets, and Cloud Computing Arrangements](index=13&type=section&id=5.%20Goodwill,%20Intangible%20Assets,%20and%20Cloud%20Computing%20Arrangements) - Goodwill increased to **$363.5 million** at June 28, 2025, from **$358.0 million** at March 29, 2025, primarily due to the Iseman Homes acquisition[46](index=46&type=chunk) | Intangible Asset | June 28, 2025 ($ thousands) | March 29, 2025 ($ thousands) | | :----------------------- | :---------------------------- | :--------------------------- | | Amortizable intangibles, net | 64,707 | 64,712 | - Amortization of intangible assets was **$2.9 million** for both Q1 FY26 and Q1 FY25. Amortization of capitalized cloud computing costs increased to **$1.0 million** in Q1 FY26 from **$0.2 million** in Q1 FY25[47](index=47&type=chunk)[48](index=48&type=chunk) [6. Investment in ECN Capital Corporation](index=14&type=section&id=6.%20Investment%20in%20ECN%20Capital%20Corporation) - The Company holds a **$137.8 million** equity investment in ECN Capital Corp. (19.9% voting shares) and formed Champion Financing LLC (51% owned) with Triad, an ECN subsidiary[49](index=49&type=chunk) - The Company's share of ECN's net losses was **$0.5 million** for Q1 FY26, down from **$1.2 million** in Q1 FY25[50](index=50&type=chunk) - Dividend income from ECN Preferred Shares was **$1.2 million** for both Q1 FY26 and Q1 FY25[51](index=51&type=chunk) [7. Other Current Liabilities](index=16&type=section&id=7.%20Other%20Current%20Liabilities) | Liability Component | June 28, 2025 ($ thousands) | March 29, 2025 ($ thousands) | | :-------------------------------- | :---------------------------- | :--------------------------- | | Customer deposits | 87,973 | 82,886 | | Accrued product liability - water intrusion | 33,283 | 34,094 | | Total other current liabilities | 294,079 | 280,081 | [8. Accrued Warranty Obligations](index=16&type=section&id=8.%20Accrued%20Warranty%20Obligations) | Metric | Three months ended June 28, 2025 ($ thousands) | Three months ended June 29, 2024 ($ thousands) | | :-------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Balance at beginning of period | 53,155 | 50,869 | | Warranty expense | 18,165 | 18,688 | | Cash warranty payments | (18,057) | (15,446) | | Balance at end of period | 53,263 | 54,111 | | Total current portion | 40,631 | 42,418 | [9. Debt and Floor Plan Payable](index=16&type=section&id=9.%20Debt%20and%20Floor%20Plan%20Payable) | Debt Type | June 28, 2025 ($ thousands) | March 29, 2025 ($ thousands) | | :---------------- | :---------------------------- | :--------------------------- | | Total long-term debt | 24,105 | 24,773 | | Floor plan payable | 103,684 | 106,091 | - The Company has a **$200.0 million** revolving credit facility, with **$172.5 million** available for borrowing as of June 28, 2025[58](index=58&type=chunk)[61](index=61&type=chunk) - The weighted average interest rate on floor plan payables was **7.06%** at June 28, 2025[65](index=65&type=chunk) [10. Revenue Recognition](index=18&type=section&id=10.%20Revenue%20Recognition) | Sales Category | Three months ended June 28, 2025 ($ thousands) | Three months ended June 29, 2024 ($ thousands) | | :----------------------- | :--------------------------------------------- | :--------------------------------------------- | | U.S. Factory-Built Housing | 661,931 | 599,533 | | Canadian Factory-Built Housing | 30,120 | 20,799 | | Corporate/Other | 9,267 | 7,447 | | Total Net Sales | 701,318 | 627,779 | [11. Income Taxes](index=19&type=section&id=11.%20Income%20Taxes) | Metric | Three months ended June 28, 2025 ($ thousands) | Three months ended June 29, 2024 ($ thousands) | | :---------------- | :--------------------------------------------- | :--------------------------------------------- | | Income tax expense | 17,699 | 13,719 | | Effective tax rate | 21.0% | 22.5% | - The recently enacted One Big Beautiful Bill Act (OBBBA) on July 4, 2025, which changes U.S. corporate income taxation, is being assessed for its potentially material financial reporting implications[69](index=69&type=chunk) [12. Earnings Per Share](index=19&type=section&id=12.%20Earnings%20Per%20Share) | Metric | Three months ended June 28, 2025 | Three months ended June 29, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | | Net income attributable to Champion Homes, Inc. ($ thousands) | 64,687 | 45,794 | | Basic net income per share | 1.13 | 0.79 | | Diluted net income per share | 1.13 | 0.79 | [13. Segment Information](index=19&type=section&id=13.%20Segment%20Information) - The Company operates in two reportable segments: U.S. Factory-built Housing and Canadian Factory-built Housing, with Corporate/Other including transportation, financing, and corporate costs[74](index=74&type=chunk) | Segment | Net Sales (Q1 FY26, $ thousands) | Net Sales (Q1 FY25, $ thousands) | Segment EBITDA (Q1 FY26, $ thousands) | Segment EBITDA (Q1 FY25, $ thousands) | | :----------------------- | :------------------------------- | :------------------------------- | :------------------------------------ | :------------------------------------ | | U.S. Factory-built Housing | 661,931 | 599,533 | 99,099 | 79,021 | | Canadian Factory-built Housing | 30,120 | 20,799 | 3,008 | 2,879 | | Corporate/Other | 9,267 | 7,447 | (12,355) | (16,024) | | Consolidated | 701,318 | 627,779 | | | [14. Commitments, Contingencies, and Legal Proceedings](index=22&type=section&id=14.%20Commitments,%20Contingencies,%20and%20Legal%20Proceedings) - The Company has a contingent repurchase obligation of **$246.5 million** on independent retailer floor plan loans, with a loss reserve of **$1.8 million** at June 28, 2025[82](index=82&type=chunk) - Outstanding letters of credit totaled **$27.5 million** and surety bonds totaled **$17.6 million** at June 28, 2025[83](index=83&type=chunk) - A product liability for water intrusion in homes built prior to fiscal 2022 has an estimated remediation cost range of **$34.5 million** to **$77.5 million**, with **$34.5 million** recorded and **$1.2 million** paid through Q1 FY26[85](index=85&type=chunk) [15. Subsequent Event](index=23&type=section&id=15.%20Subsequent%20Event) - On July 28, 2025, the Company entered into a Second Amended and Restated Credit Agreement, providing a **$200.0 million** revolving credit facility (with potential for an additional **$100.0 million**) maturing on July 28, 2030[88](index=88&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Champion Homes' financial condition and operational results, covering business overview, acquisitions, and performance analysis [Overview](index=24&type=section&id=Overview) - Champion Homes, Inc. is a leading producer of factory-built housing in the U.S. and Canada, operating 42 U.S. and 4 Canadian manufacturing facilities and 82 U.S. retail sales centers[91](index=91&type=chunk) - The Company offers a complete solutions provider model, including manufacturing, company-owned retail, construction services, and transportation logistics[91](index=91&type=chunk) [Acquisitions, Expansions and Consolidations](index=24&type=section&id=Acquisitions,%20Expansions%20and%20Consolidations) - The Company acquired Iseman Homes in May 2025 (10 retail sales centers) and Regional Homes in October 2023 (3 manufacturing facilities, 44 retail sales centers) to strengthen distribution and expand market presence[93](index=93&type=chunk) - Strategic actions include idling production at the Bartow, Florida plant and planning to cease operations at the Kelowna, British Columbia plant to improve operating efficiency and profitability[94](index=94&type=chunk) - An equity investment in ECN facilitated the creation of Champion Financing LLC, a captive finance company, to provide financing solutions and improve market share[95](index=95&type=chunk) [Industry and Company Outlook](index=24&type=section&id=Industry%20and%20Company%20Outlook) - Demand for affordable, single-family housing continues to drive the market, supported by demographic trends in key homebuyer groups[97](index=97&type=chunk) - Manufacturing backlog decreased to **$302.5 million** as of June 28, 2025, from **$404.8 million** in the prior year, due to decreased customer orders and higher production rates[98](index=98&type=chunk) - The Company's U.S. wholesale market share of HUD code homes increased to **22.5%** for the three months ended May 31, 2025, up from **21.3%** in the prior year[99](index=99&type=chunk) [UNAUDITED RESULTS OF OPERATIONS FOR THE FIRST QUARTER OF FISCAL 2026 VS. 2025](index=26&type=section&id=UNAUDITED%20RESULTS%20OF%20OPERATIONS%20FOR%20THE%20FIRST%20QUARTER%20OF%20FISCAL%202026%20VS.%202025) Analyzes Champion Homes' unaudited financial performance for Q1 FY26 compared to Q1 FY25, detailing key operational metrics | Metric | Three months ended June 28, 2025 ($ thousands) | Three months ended June 29, 2024 ($ thousands) | YoY Change (%) | | :--------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :------------- | | Net sales | 701,318 | 627,779 | 11.7% | | Gross profit | 189,830 | 164,215 | 15.6% | | Operating income | 78,521 | 55,388 | 41.8% | | Net income attributable to Champion Homes, Inc. | 64,687 | 45,794 | 41.2% | | Adjusted EBITDA | 94,177 | 74,967 | 25.6% | [NET SALES](index=27&type=section&id=NET%20SALES) - Net sales increased by **$73.5 million**, or **11.7%**, to **$701.3 million** for Q1 FY26 compared to Q1 FY25[101](index=101&type=chunk) - U.S. manufacturing and retail net sales rose **10.4%** due to a **6.5%** increase in homes sold and a **3.6%** increase in average selling price[102](index=102&type=chunk) - Canadian manufacturing net sales grew **44.8%** due to a **49.7%** increase in homes sold, partially offset by a **3.3%** decrease in average selling price[103](index=103&type=chunk) [GROSS PROFIT](index=27&type=section&id=GROSS%20PROFIT) - Total gross profit increased by **$25.6 million**, or **15.6%**, to **$189.8 million** for Q1 FY26[105](index=105&type=chunk) - Gross profit as a percent of net sales improved to **27.1%** in Q1 FY26 from **26.2%** in Q1 FY25[105](index=105&type=chunk) - U.S. Factory-built Housing gross profit margin increased to **26.3%** (from **25.7%**) due to higher average selling prices and reduced impact from purchase accounting[107](index=107&type=chunk) [SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES](index=29&type=section&id=SELLING,%20GENERAL,%20AND%20ADMINISTRATIVE%20EXPENSES) - Total SG&A expenses increased by **$2.5 million**, or **2.3%**, to **$111.3 million** for Q1 FY26[110](index=110&type=chunk) - SG&A as a percent of net sales decreased to **15.9%** in Q1 FY26 from **17.3%** in Q1 FY25[110](index=110&type=chunk) - U.S. Factory-built Housing SG&A increased due to higher incentive compensation, Iseman Homes acquisition, and Bartow plant idling costs, partially offset by the non-recurrence of a **$7.9 million** contingent consideration charge[111](index=111&type=chunk) - Canadian Factory-built Housing SG&A increased by **96.8%** due to **$2.9 million** in costs associated with the Kelowna plant closure[112](index=112&type=chunk) [INTEREST (INCOME), NET](index=30&type=section&id=INTEREST%20(INCOME),%20NET) - Net interest income was **$4.5 million** for Q1 FY26, an increase from **$4.2 million** in Q1 FY25, primarily due to lower interest rates on invested cash balances and floor plan payables[114](index=114&type=chunk) [OTHER (INCOME) EXPENSE](index=30&type=section&id=OTHER%20(INCOME)%20EXPENSE) - Other income remained stable at approximately **$1.2 million** for both Q1 FY26 and Q1 FY25, representing dividend income from the investment in ECN Preferred Shares[115](index=115&type=chunk) [INCOME TAX EXPENSE](index=30&type=section&id=INCOME%20TAX%20EXPENSE) - Income tax expense increased by **29.0%** to **$17.7 million** for Q1 FY26, with the effective tax rate decreasing to **21.0%** from **22.5%** in Q1 FY25[116](index=116&type=chunk)[117](index=117&type=chunk) [EQUITY IN NET INCOME OF AFFILIATES](index=32&type=section&id=EQUITY%20IN%20NET%20INCOME%20OF%20AFFILIATES) - Equity in net loss of affiliates decreased by **56.4%** to **$0.6 million** for Q1 FY26, primarily due to a lower share of ECN's net losses[118](index=118&type=chunk) [NON-CONTROLLING INTEREST](index=32&type=section&id=NON-CONTROLLING%20INTEREST) - Net income attributable to non-controlling interest was **$1.3 million** for Q1 FY26, representing the minority partner's 49% share of Champion Financing's results[119](index=119&type=chunk) [ADJUSTED EBITDA](index=32&type=section&id=ADJUSTED%20EBITDA) - Adjusted EBITDA increased by **$19.2 million**, or **25.6%**, to **$94.2 million** for Q1 FY26, driven by higher sales volumes and gross profit, partially offset by higher SG&A expenses[120](index=120&type=chunk) - Adjusted EBITDA as a percent of net sales was **13.4%** for Q1 FY26, up from **11.9%** in Q1 FY25[100](index=100&type=chunk) [BACKLOG](index=34&type=section&id=BACKLOG) - The Company's unfilled U.S. and Canadian manufacturing orders decreased to **$302.5 million** at June 28, 2025, from **$404.8 million** at June 29, 2024[126](index=126&type=chunk) - The decrease in backlog is attributed to lower orders and higher production rates during Q1 FY26 compared to the prior year[126](index=126&type=chunk) [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) Examines Champion Homes' cash flow, debt, and credit facilities, detailing sources and uses of capital for operations and investments [Sources and Uses of Cash](index=34&type=section&id=Sources%20and%20Uses%20of%20Cash) - Net cash provided by operating activities decreased to **$75.3 million** in Q1 FY26 from **$84.6 million** in Q1 FY25, primarily due to less favorable changes in working capital[128](index=128&type=chunk)[129](index=129&type=chunk) - Net cash used in investing activities increased significantly to **$33.9 million** in Q1 FY26 from **$9.1 million** in Q1 FY25, mainly due to the Iseman Homes acquisition[130](index=130&type=chunk) - Net cash used in financing activities increased to **$51.9 million** in Q1 FY26 from **$20.6 million** in Q1 FY25, primarily due to **$50.0 million** in common stock repurchases[131](index=131&type=chunk) - The Company had **$172.5 million** available for borrowing under its Amended Credit Agreement as of June 28, 2025[127](index=127&type=chunk) [Critical Accounting Policies](index=36&type=section&id=Critical%20Accounting%20Policies) - There have been no significant changes in critical accounting policies other than those included in Note 1, 'Basis of Presentation'[132](index=132&type=chunk) [Recently Issued Accounting Pronouncements](index=36&type=section&id=Recently%20Issued%20Accounting%20Pronouncements) - Information on the impact of recently issued accounting pronouncements is provided in Note 1, 'Basis of Presentation – Recently Issued Accounting Pronouncements'[133](index=133&type=chunk) [Forward-Looking Statements](index=36&type=section&id=Forward-Looking%20Statements) - The report contains forward-looking statements subject to various risks and uncertainties, including supply issues, labor, inflation, housing industry cyclicality, demand fluctuations, and potential impairment of assets[134](index=134&type=chunk)[140](index=140&type=chunk) - Other risks include quality problems (e.g., water intrusion claims), data security breaches, regulatory changes, M&A integration risks, and the material weakness in internal control over financial reporting[134](index=134&type=chunk)[140](index=140&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Refers to the Fiscal 2025 Annual Report for market risk disclosures, noting no significant changes in interest rate or foreign exchange risks - There have been no significant changes in the Company's interest rate and foreign exchange risks since March 29, 2025[136](index=136&type=chunk) [Item 4. Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Addresses disclosure controls and procedures, identifying a material weakness in internal control over financial reporting and outlining remediation efforts [Evaluation of disclosure controls and procedures](index=38&type=section&id=Evaluation%20of%20disclosure%20controls%20and%20procedures) - The CEO and CFO concluded that the Company's disclosure controls and procedures were not effective as of June 28, 2025, due to a material weakness in internal control over financial reporting[138](index=138&type=chunk) [Material Weakness](index=38&type=section&id=Material%20Weakness) - A material weakness was identified in internal controls related to ineffective operation of controls in the retail operations of Regional Homes, acquired in October 2023[139](index=139&type=chunk) - This weakness resulted from insufficiently documented manual controls over transaction recording and a lack of analysis and review related to financial statement accounts[139](index=139&type=chunk) [Remediation of Material Weakness](index=39&type=section&id=Remediation%20of%20Material%20Weakness) - Management is implementing measures including improving retail accounting/IT systems, additional training, hiring personnel, and increasing corporate oversight to remediate the material weakness[141](index=141&type=chunk) - The material weakness will be considered remediated only after applicable controls operate effectively for a sufficient period and are tested[142](index=142&type=chunk) [Changes in internal control over financial reporting](index=39&type=section&id=Changes%20in%20internal%20control%20over%20financial%20reporting) - Except for the material weakness and remediation efforts, there were no other material changes in internal control over financial reporting during the quarter[143](index=143&type=chunk) - The acquired operations of Iseman Homes are excluded from the current assessment of internal control over financial reporting[143](index=143&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=40&type=section&id=Item%201.%20Legal%20Proceedings) Refers to Note 14 for legal proceedings, noting no material adverse effect on financial condition, results, or cash flows is expected - The Company is involved in various legal proceedings and claims in the ordinary course of business[146](index=146&type=chunk) - The ultimate liability from these contingent obligations is not expected to have a material adverse effect on the Company's financial condition, results of operations, or cash flows[146](index=146&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=40&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details the Company's share repurchase program, including recent increases in authorization and shares repurchased during Q1 FY26 - The Board of Directors increased the share repurchase program authorization by **$70.0 million** in Q1 FY26 and by an additional **$50.0 million** on July 24, 2025, bringing the available amount to **$150.0 million**[147](index=147&type=chunk) | Fiscal Period | Total Number of Shares Purchased | Average Price Paid Per Share | | :-------------------- | :------------------------------- | :--------------------------- | | 5/4/2025 - 5/31/2025 | 100,187 | $65.69 | | 6/1/2025 - 6/28/2025 | 671,601 | $64.63 | | Total | 771,788 | | [Item 5. Other Information](index=40&type=section&id=Item%205.%20Other%20Information) States that no directors or Section 16 officers adopted or terminated a Rule 10b5-1 Trading Plan during Q1 FY26 - None of the Company's directors or Section 16 officers adopted or terminated a Rule 10b5-1 Trading Plan during the three months ended June 28, 2025[148](index=148&type=chunk) [Item 6. Exhibits](index=41&type=section&id=Item%206.%20Exhibits) Lists the exhibits filed with the Form 10-Q, including certifications from the CEO and CFO, and Inline XBRL documents - Exhibits include certifications of the CEO and CFO (31.1, 31.2, 32) and Inline XBRL Instance and Taxonomy Extension Schema documents (101, 104)[149](index=149&type=chunk) SIGNATURES [SIGNATURES](index=42&type=section&id=SIGNATURES) Contains formal signatures of the Company's authorized officers, certifying the filing of the Form 10-Q report - The report was signed by Tim Larson, President and Chief Executive Officer, and Laurie Hough, Executive Vice President, Chief Financial Officer and Treasurer, on August 6, 2025[153](index=153&type=chunk)

Financial Data and Key Metrics Changes - For the first quarter, net sales increased by 12% to $701 million, with homes sold rising by 8% to 7,215 homes [8][14] - Consolidated gross profit increased by 16% to $190 million, with gross margin expanding by 90 basis points to 26.2% [17] - Net income attributable to the company rose by $19 million to $65 million, translating to earnings of $1.13 per diluted share, compared to $0.79 per diluted share in the prior year [18] Business Line Data and Key Metrics Changes - Sales to the independent retail channel increased year-over-year, supported by digital marketing and the addition of independent distribution points [10] - Community sales were up due to new products and strong engagement from the sales team, although moderation is anticipated in the near term [11] - Builder developer channel sales grew, with a solid pipeline and increased adoption of off-site construction [11] Market Data and Key Metrics Changes - U.S. factory-built housing revenue increased by 10%, with the average selling price per home rising by 4% to $95,000 [14] - Canadian revenue reached $30 million, a 50% increase in homes sold, although the average selling price decreased by 3% to $120,500 [16] Company Strategy and Development Direction - The company is focused on customer-centric strategies and has added experienced executives to enhance its leadership team [4][5] - Investments in new product strategies aim to attract new buyers with appealing home styles and floor plans [6] - The company is monitoring legislative developments, such as the Road to Housing Act, which supports off-site built homes [7] Management Comments on Operating Environment and Future Outlook - The company anticipates flat to low single-digit revenue growth in the second quarter compared to the prior year, citing slower order rates [22] - Management is encouraged by customer engagement and quoting activity, despite a cautious consumer sentiment [22] - The company remains focused on balancing fixed costs and production optimization in response to market dynamics [22] Other Important Information - The company generated $75 million in operating cash flows and returned $50 million to shareholders through share repurchases [20] - A $200 million revolving credit facility was amended and extended, providing liquidity for strategic initiatives [21] Q&A Session Summary Question: Commentary on the current market backdrop and order rates - Management noted stronger community business in Q1 but anticipates moderation in Q2 due to consumer dynamics [27][28] Question: Performance in June compared to expectations - The community business significantly impacted Q1 results, with improved pricing and lower material costs contributing to a strong quarter [30][31] Question: Impact of delayed shipments on revenue - Management did not quantify the impact of delayed shipments but acknowledged it contributed to the difference between expectations and actual results [32][33] Question: Community channel moderation and geographic dispersion - Management indicated that while community orders were robust in Q1, they do not expect the same growth rate in Q2 due to varying demand across geographies [38][39] Question: Outlook for Canadian market recovery - The Alberta region showed strength, but the overall Canadian market remains dynamic and subject to consumer challenges [42][43] Question: Contribution of Eiseman Homes to revenue - Eiseman Homes contributed one month of revenue since its acquisition on May 30, but did not impact backlog numbers [44] Question: Gross margin expectations and pricing dynamics - Management expects gross margins to remain in the 25% to 26% range, influenced by product mix and local demand [48][49] Question: Tariff impact on material costs - The estimated unmitigated impact of tariffs on material costs is approximately 1%, which is already considered in the guidance [68][72]

Financial Data and Key Metrics Changes - In Q1 2026, net sales increased by 12% to $701 million, with homes sold rising by 8% to 7,215 homes [8][19] - U.S. factory-built housing revenue increased by 10%, with the average selling price per U.S. home sold rising by 4% to $95,000 [14][19] - Consolidated gross profit increased by 16% to $190 million, with gross margin expanding by 90 basis points to 27.1% [17][19] - Net income attributable to Champion Homes increased by $19 million to $65 million, resulting in earnings of $1.13 per diluted share [19][20] Business Line Data and Key Metrics Changes - Sales to the independent retail channel increased compared to the prior year, driven by digital marketing support and new distribution points [9][10] - Community sales were up in Q1, supported by new products and strong sales team engagement, although moderation is anticipated in the near term [10][41] - Builder developer channel sales grew, with a solid pipeline and increased adoption of off-site construction [11][41] Market Data and Key Metrics Changes - Canadian revenue increased by 50% in the number of homes sold, with a shift towards single-section homes and stronger demand in Alberta [16] - Manufacturing backlog totaled $302 million, down 12% sequentially, with average backlog lead time at seven weeks [9][20] Company Strategy and Development Direction - The company is focused on customer-centric strategies and has added experienced executives to enhance leadership [4][5] - Investments in new product strategies aim to attract new buyers with affordable home styles and floor plans [6][24] - The company is monitoring legislative developments, such as the Road to Housing Act, which supports manufactured housing [7] Management's Comments on Operating Environment and Future Outlook - Management anticipates Q2 revenue to be flat to up low single digits compared to the prior year, with slower order rates observed [23] - The company is encouraged by customer engagement and quoting activity, despite a cautious consumer sentiment [23][24] - Management remains confident in the strategies being executed to deliver value to stakeholders [25] Other Important Information - The company generated $75 million in operating cash flows for the quarter and returned $50 million to shareholders through share repurchases [21][22] - The existing $200 million revolving credit facility was amended and extended through July 20230, providing liquidity for strategic initiatives [22] Q&A Session Summary Question: Commentary on the current market environment and order rates - Management noted stronger community business in Q1 but anticipates moderation in Q2 due to consumer dynamics [29][30] Question: Performance in June compared to expectations - Management highlighted improved community business and pricing in captive retail as key drivers for Q1 performance [32][33] Question: Impact of delayed shipments on revenue - Management acknowledged that delayed shipments contributed to the difference between expectations and actual results [34][35] Question: Community channel moderation and geographic dispersion - Management indicated that moderation is expected across multiple geographies, with community operators balancing projects with consumer demand [40][42] Question: Inventory management in captive retail - Management is actively working through inventory in captive retail stores and expects to provide updates in Q2 [66][68] Question: Gross margin expectations and input costs - Management expects gross margins to remain in the 25% to 26% range, influenced by cautious consumer sentiment and product mix [51][74] Question: Tariff impacts on material costs - Management stated that the unmitigated impact of tariffs is approximately 1% of material costs, which is already considered in the guidance [71][74] Question: Tracking household income of homebuyers - Management is encouraged by attracting first-time homebuyers and is reviewing internal survey data to understand buyer demographics [79][80]

Group 1 - Champion Homes reported quarterly earnings of $1.19 per share, exceeding the Zacks Consensus Estimate of $0.88 per share, and up from $0.91 per share a year ago, representing an earnings surprise of +35.23% [1] - The company posted revenues of $701.32 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 9.04%, compared to $627.78 million in the same quarter last year [2] - Champion Homes has surpassed consensus EPS estimates three times over the last four quarters, indicating a positive trend in earnings performance [2] Group 2 - The stock has underperformed the market, losing about 25.7% since the beginning of the year, while the S&P 500 has gained 7.6% [3] - The current consensus EPS estimate for the coming quarter is $0.92 on revenues of $663.3 million, and for the current fiscal year, it is $3.44 on revenues of $2.62 billion [7] - The Zacks Industry Rank for Building Products - Mobile Homes and RV Builders is currently in the bottom 7% of over 250 Zacks industries, suggesting potential challenges for the sector [8]

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Financial Performance - The company's revenue reached $2.6 billion[22], with an adjusted EBITDA margin of 21%[22] - Free cash flow amounted to $493 million[22] - The average US home selling price was $98 thousand[22] - Adjusted EBITDA was $545 million[22] - Net income was $402 million[22] Market Position and Production - The company sold 25,910 homes in North America[22] - The company's HUD market share is 20.4% based on shipment data[22] - Gross margin was 31.4%[22] Strategic Initiatives - The company is focused on increasing operating capacity and margin through product design and efficiency improvements[39] - The company is pursuing production automation and enterprise-wide digital technologies to reduce waste and improve decision-making[40] - The company is implementing an organic and acquisition-based growth strategy to expand into new geographies[41]