PART I. FINANCIAL INFORMATION Item 1. Financial Statements This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive income (loss), stockholders' equity, and cash flows, along with detailed notes explaining accounting policies, segment performance, debt, and other financial disclosures for the periods ended July 4, 2025, and June 28, 2024 Unaudited Condensed Consolidated Balance Sheets Presents the company's financial position, assets, liabilities, and equity at specific dates Balance Sheet Summary | Metric | July 4, 2025 (in thousands) | January 3, 2025 (in thousands) | | :----------------------------- | :-------------------------- | :--------------------------- | | Cash and cash equivalents | $81,451 | $71,674 | | Accounts receivable | $185,359 | $165,827 | | Inventory | $412,762 | $404,736 | | Total current assets | $746,555 | $727,680 | | Goodwill | $377,366 | $639,505 | | Total assets | $1,965,002 | $2,232,310 | | Total current liabilities | $246,011 | $259,780 | | Total liabilities | $1,006,400 | $1,031,166 | | Total stockholders' equity | $958,719 | $1,201,182 | Unaudited Condensed Consolidated Statements of Operations Details the company's revenues, expenses, and net income (loss) over specific periods Statements of Operations Summary | Metric (in thousands) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :-------------------- | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | Net sales | $374,864 | $348,491 | $729,894 | $681,963 | | Gross profit | $116,991 | $110,963 | $226,670 | $214,121 | | Goodwill impairment | — | — | $262,129 | — | | Income (loss) from operations | $18,528 | $18,590 | $(232,059) | $27,465 | | Net income (loss) | $2,705 | $5,407 | $(257,029) | $1,911 |\ | Basic EPS | $0.07 | $0.13 | $(6.15) | $0.05 |\ | Diluted EPS | $0.07 | $0.13 | $(6.15) | $0.05 | Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) Reports net income (loss) and other comprehensive income (loss) for specific periods Statements of Comprehensive Income (Loss) Summary | Metric (in thousands) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :-------------------- | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | Net income (loss) | $2,705 | $5,407 | $(257,029) | $1,911 | | Other comprehensive income (loss) | $12,190 | $(2,435) | $7,821 | $(5,643) | | Comprehensive income (loss) | $14,895 | $2,972 | $(249,208) | $(3,732) | Unaudited Condensed Consolidated Statements of Stockholders' Equity Outlines changes in equity components, including common stock and retained earnings Statements of Stockholders' Equity Summary | Metric (in thousands) | July 4, 2025 | January 3, 2025 | | :-------------------- | :----------- | :-------------- | | Common stock | $42 | $42 |\ | Additional paid-in capital | $345,932 | $339,266 |\ | Treasury stock | $(13,754) | $(13,754) |\ | Accumulated other comprehensive income | $8,045 | $224 |\ | Retained earnings | $618,454 | $875,404 |\ | Total stockholders' equity | $958,719 | $1,201,182 | Unaudited Condensed Consolidated Statements of Cash Flows Summarizes cash inflows and outflows from operating, investing, and financing activities Cash Flow Summary | Activity (in thousands) | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :---------------------- | :-------------------------- | :--------------------------- | | Net cash provided by operating activities | $37,468 | $36,037 | | Net cash used in investing activities | $(19,412) | $(26,579) | | Net cash used in financing activities | $(9,393) | $(10,688) | | Change in cash and cash equivalents | $9,777 | $(1,396) | | Cash and cash equivalents—End of period | $81,451 | $82,246 | Notes to Unaudited Condensed Consolidated Financial Statements Provides detailed explanations of accounting policies and specific financial statement items Note 1. Description of the Business, Basis of Presentation, and Summary of Significant Accounting Policies Describes the company's business, financial statement presentation, and key accounting policies - The Company designs, engineers, manufactures, and markets premium products and systems for bikes, powered vehicles, and specialty sports gear globally24 - A non-cash goodwill impairment charge of $262.1 million was recorded in the first quarter of fiscal year 2025, impacting all reporting units, due to adverse changes in U.S. tariff policies and a sustained decline in stock price37 - The Company operates on a 52-53-week fiscal year, with the three and six-month periods ended July 4, 2025, and June 28, 2024, each including 13 and 26 weeks, respectively27 Note 2. Revenues Details revenue recognition policies and disaggregated net sales by segment, channel, and geography Net Sales by Segment | Segment (Net Sales in thousands) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :------------------------------- | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | Powered Vehicles Group | $123,514 | $117,795 | $245,612 | $235,908 | | Aftermarket Applications Group | $114,144 | $107,129 | $226,058 | $208,981 | | Specialty Sports Group | $137,206 | $123,567 | $258,224 | $237,074 | | Total net sales | $374,864 | $348,491 | $729,894 | $681,963 | Net Sales by Sales Channel | Sales Channel (Net Sales in thousands) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :------------------------------------- | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | OEM | $173,757 | $151,299 | $330,078 | $289,108 | | Aftermarket/Non-OEM | $201,107 | $197,192 | $399,816 | $392,855 | | Total net sales | $374,864 | $348,491 | $729,894 | $681,963 | Net Sales by Geographic Location | Geographic Location (Net Sales in thousands) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :------------------------------------------- | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | North America | $271,676 | $278,153 | $543,977 | $562,815 | | Europe | $58,147 | $37,524 | $106,424 | $64,774 | | Asia | $38,741 | $26,315 | $66,550 | $44,485 | | Rest of the world | $6,300 | $6,499 | $12,943 | $9,889 | | Total net sales | $374,864 | $348,491 | $729,894 | $681,963 | Note 3. Inventory Provides a breakdown of inventory components, including raw materials, work-in-process, and finished goods Inventory Breakdown | Inventory Type (in thousands) | July 4, 2025 | January 3, 2025 | | :---------------------------- | :----------- | :-------------- | | Raw materials | $249,602 | $245,368 | | Work-in-process | $23,110 | $16,519 | | Finished goods | $140,050 | $142,849 | | Total inventory | $412,762 | $404,736 | Note 4. Prepaids and Other Current Assets Details the composition of prepaid expenses and other current assets Prepaid and Other Current Assets Breakdown | Asset Type (in thousands) | July 4, 2025 | January 3, 2025 | | :------------------------ | :----------- | :-------------- |\ | Prepaid chassis deposits | $31,217 | $47,094 |\ | Advanced payments and prepaid contracts | $22,931 | $26,496 |\ | Other current assets | $12,835 | $11,853 |\ | Total prepaid and other current assets | $66,983 | $85,443 | Note 5. Property, Plant and Equipment, net Presents the breakdown of property, plant, and equipment, net of accumulated depreciation Property, Plant and Equipment Breakdown | Asset Type (in thousands) | July 4, 2025 | January 3, 2025 | | :------------------------ | :----------- | :-------------- | | Machinery and manufacturing equipment | $190,516 | $177,261 | | Building and building improvements | $84,492 | $82,224 | | Leasehold improvements | $42,294 | $40,663 | | Internal-use computer software | $38,315 | $38,572 | | Information systems, office equipment and furniture | $34,062 | $28,725 | | Transportation equipment | $24,712 | $23,299 | | Land and land improvements | $15,563 | $15,521 | | Total property, plant and equipment | $429,954 | $406,265 | | Less: accumulated depreciation and amortization | $(182,483) | $(159,872) | | Total property, plant and equipment, net | $247,471 | $246,393 | Property, Plant and Equipment by Geographic Location | Geographic Location (in thousands) | July 4, 2025 | January 3, 2025 | | :--------------------------------- | :----------- | :-------------- | | United States | $203,673 | $203,937 | | International | $43,798 | $42,456 | | Total long-lived assets | $247,471 | $246,393 | Note 6. Accrued Expenses Details the components of accrued expenses and warranty liability activity Accrued Expenses Breakdown | Accrued Expense Type (in thousands) | July 4, 2025 | January 3, 2025 | | :---------------------------------- | :----------- | :-------------- | | Payroll and related expenses | $30,214 | $22,504 | | Warranty | $18,543 | $21,593 | | Current portion of lease liabilities | $16,600 | $16,683 | | Accrued sales rebate | $10,459 | $7,852 | | Income tax payable | $5,460 | $9,343 | | Other accrued expenses | $9,320 | $13,452 | | Total accrued expenses | $90,596 | $91,427 | Warranty Liability Activity | Warranty Activity (in thousands) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :------------------------------- | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | Beginning warranty liability | $19,113 | $19,327 | $21,593 | $20,001 | | Charge to cost of sales | $2,679 | $5,546 | $4,147 | $9,489 | | Costs incurred | $(3,249) | $(4,180) | $(7,197) | $(8,797) | | Ending warranty liability | $18,543 | $20,693 | $18,543 | $20,693 | Note 7. Debt Describes the company's debt facilities, including revolving loans and term loan principal payments - The 2022 Credit Facility, maturing on April 5, 2027, provides for revolving loans, swingline loans, and letters of credit up to an aggregate amount of $650.0 million70 Revolver Loan Status | Revolver Status (in thousands) | July 4, 2025 | January 3, 2025 | | :----------------------------- | :----------- | :-------------- | | Amount outstanding | $157,000 | $153,000 | | Standby letters of credit | $164 | $155 | | Available borrowing capacity | $492,836 | $496,845 | | Total borrowing capacity | $650,000 | $650,000 | Term Loan Principal Payment Schedule | Term Loan Principal Payments (in thousands) | July 4, 2025 | | :------------------------------------------ | :----------- | | For fiscal year 2025 | $12,143 | | For fiscal year 2026 | $24,286 | | For fiscal year 2027 | $512,143 | | Total | $548,572 | | Long-term debt, net of issuance cost | $541,780 | Note 8. Commitments and Contingencies Outlines significant legal proceedings and other contractual commitments and contingencies - The Company is currently involved in a federal securities class action lawsuit and two stockholder derivative complaints, all of which the Company denies wrongdoing and intends to vigorously defend8384 - Bailment pool arrangements for truck chassis with GM and Ford involve interest payments, while Stellantis chassis require cash deposits, with interest expense related to chassis on hand totaling $1.7 million for the six months ended July 4, 20258586 Note 9. Derivatives and Hedging Explains the company's use of derivative instruments for hedging interest rate risk - The Company utilizes interest rate swaps to hedge the variability of cash flows in interest payments associated with the first $500.0 million of its variable rate debt88 Interest Rate Swap Contracts Summary | Interest Rate Swap Contracts (in thousands) | July 4, 2025 Unrealized Gain (Loss) in AOCI | January 3, 2025 Unrealized Gain (Loss) in AOCI | | :------------------------------------------ | :---------------------------------------- | :--------------------------------------------- | | April 5, 2022 - April 5, 2027 ($100,000 Notional) | $1,739 | $2,650 | | September 20, 2024 - December 26, 2025 ($100,000 Notional) | $76 | $(87) | | September 20, 2024 - December 25, 2026 ($200,000 Notional) | $(82) | $903 | | September 20, 2024 - September 21, 2029 ($100,000 Notional) | $(86) | $2,219 | | Total | $1,647 | $6,468 | - An estimated $1.6 million of existing net gain in Accumulated Other Comprehensive Income (AOCI) related to interest rate swap contracts is expected to be reclassified as a decrease to interest expense over the next 12 months92 Note 10. Fair Value Measurements and Financial Instruments Presents assets and liabilities measured at fair value and related valuation methodologies Fair Value Assets Summary | Fair Value Assets (in thousands) | July 4, 2025 (Total) | January 3, 2025 (Total) | | :------------------------------- | :------------------- | :---------------------- | | Deferred Compensation Plan Investments | $4,455 | $4,394 | | Interest Rate Swaps | $1,815 | $5,685 | | Total assets measured at fair value | $6,270 | $10,079 | Fair Value Liabilities Summary | Fair Value Liabilities (in thousands) | July 4, 2025 (Total) | January 3, 2025 (Total) | | :------------------------------------ | :------------------- | :---------------------- | | Incremental Term Loans | $541,780 | $552,061 | | Revolver | $157,000 | $153,000 | | Deferred Compensation Plan Liabilities | $4,434 | $4,300 | | Interest Rate Swaps | $168 | — | | Total liabilities measured at fair value | $703,382 | $709,361 | Note 11. Stockholders' Equity Details changes in stockholders' equity and stock-based compensation expenses - The Company has an authorized share repurchase plan for up to $300.0 million in common stock, with $250.0 million remaining available as of July 4, 2025100101221 - No common stock was repurchased for retirement during the six months ended July 4, 2025; however, 32,717 shares were acquired to satisfy tax-withholding obligations101220 Stock-Based Compensation Expenses | Stock-Based Compensation (in thousands) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :-------------------------------------- | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | Cost of sales | $347 | $320 | $645 | $556 | | Sales and marketing | $461 | $292 | $850 | $667 | | Research and development | $395 | $361 | $727 | $626 | | General and administrative | $3,359 | $1,230 | $5,695 | $4,259 | | Total | $4,562 | $2,203 | $7,917 | $6,108 | Note 12. Earnings (Net Loss) Per Share Provides basic and diluted earnings (net loss) per share calculations Earnings Per Share Summary | EPS (in thousands, except per share) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :----------------------------------- | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | Net income (loss) attributable to FOX stockholders | $2,744 | $5,407 | $(256,950) | $1,911 | | Basic EPS | $0.07 | $0.13 | $(6.15) | $0.05 | | Diluted EPS | $0.07 | $0.13 | $(6.15) | $0.05 | - Due to the net loss reported for the six months ended July 4, 2025, no dilutive shares were included in the calculation of diluted net loss per share for the period111 Note 13. Income Taxes Details the provision (benefit) from income taxes and effective tax rates Income Tax Provision (Benefit) and Effective Rates | Income Tax (in thousands) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :------------------------ | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | Provision (benefit) from income taxes | $2,800 | $(371) | $(837) | $(1,638) | | Effective tax rates | 50.9% | (7.4)% | 0.3% | (600.0)% | - The effective tax rate for the six months ended July 4, 2025, was 0.3%, primarily due to the impairment impact of non-deductible goodwill115 - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, introducing significant tax provisions, but it does not affect the measurement of deferred tax assets and liabilities as of July 4, 2025117 Note 14. Acquisitions Describes recent business acquisitions and their financial contributions - The Company acquired Marzocchi Suspension S.r.l. on December 19, 2024, for $20.5 million (net of cash acquired), aiming to expand its motorcycle suspension manufacturing capabilities120 Marzocchi Acquisition Financial Contribution | Marzocchi Financial Contribution (in thousands) | 3 Months Ended July 4, 2025 | 6 Months Ended July 4, 2025 | | :---------------------------------------------- | :-------------------------- | :-------------------------- | | Total revenues | $11,691 | $23,660 | | Total pre-tax losses | $(722) | $(2,345) | - Goodwill of $3.3 million was recognized from the Marzocchi acquisition, which is tax deductible for U.S. income tax purposes124 Note 15. Segment Information Presents financial information by operating segment, including net sales and Adjusted EBITDA - The Company manages its activities through three operating segments: Powered Vehicles Group (PVG), Aftermarket Applications Group (AAG), and Specialty Sports Group (SSG)126 - Adjusted EBITDA is the key financial metric used by the Chief Operating Decision Maker (CODM) to measure the profitability and financial performance of the operating segments131 Net Sales by Segment | Net Sales by Segment (in millions) | 3 Months Ended July 4, 2025 | 3 Months Ended June 28, 2024 | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :--------------------------------- | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------------- | | Powered Vehicles Group | $123.5 | $117.8 | $245.6 | $235.9 | | Aftermarket Applications Group | $114.2 | $107.1 | $226.1 | $209.0 | | Specialty Sports Group | $137.2 | $123.6 | $258.2 | $237.1 | | Total net sales | $374.9 | $348.5 | $729.9 | $682.0 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on the company's financial performance, condition, and future outlook, including a detailed analysis of operating results for the three and six months ended July 4, 2025, compared to the prior year, critical accounting policies, liquidity, and capital resources, and a discussion of forward-looking statements and risk factors Cautionary Note Regarding Forward-Looking Statements Highlights inherent risks and uncertainties associated with forward-looking statements - Forward-looking statements are subject to substantial risks and uncertainties, including changes in general economic conditions, market disruptions from escalating geopolitical tensions (China-Taiwan, Russia-Ukraine, Israel-Palestine), growing inflation, higher interest rates, and tariffs143 - Key risks include dependency on a limited number of suppliers for materials and vehicle chassis, which could lead to increased costs or supply chain disruptions143 - Other risks encompass the ability to develop new products, expand into new markets, increase aftermarket penetration, accelerate international growth, and manage exchange rate fluctuations143 Critical Accounting Policies and Estimates Discusses key accounting policies and estimates that significantly impact financial reporting - A non-cash goodwill impairment charge of $262.1 million was recognized in the first quarter of fiscal year 2025, impacting all reporting units, due to adverse changes in U.S. tariff policies and a sustained decline in the Company's stock price148 - The fair value of reporting units for goodwill impairment testing is determined using a weighting of income (discounted cash flow) and market approaches, with sensitivity analyses performed to assess the impact of changes in key assumptions149 Results of Operations Analyzes the company's financial performance and operating results for the reported periods Three months ended July 4, 2025 compared to three months ended June 28, 2024 Compares the company's operating results for the three months ended July 4, 2025, and June 28, 2024 Operating Results: Three Months Ended | Metric (in millions) | July 4, 2025 | June 28, 2024 | Change ($) | Change (%) | | :------------------- | :----------- | :------------ | :--------- | :--------- | | Net sales | $374.9 | $348.5 | $26.4 | 7.6% | | Cost of sales | $257.9 | $237.5 | $20.4 | 8.6% | | Gross margin | 31.2% | 31.8% | -0.6% | - | | Operating expenses | $98.5 | $92.4 | $6.1 | 6.6% | | Income from operations | $18.5 | $18.6 | $(0.1) | (0.5)% | | Net income | $2.7 | $5.4 | $(2.7) | (50.0)%| - The increase in net sales was driven by stabilized bike sales, increased demand for aftermarket products, and the expansion of the motorcycle business, partially offset by lower industry demand in automotive OE product lines154 - Gross margin decreased by 60 basis points primarily due to product mix and the impact of tariffs155 Segment Review (Three Months) Reviews the financial performance of operating segments for the three-month periods Segment Performance: Three Months Ended | Segment (in millions) | Net Sales (July 4, 2025) | Net Sales (June 28, 2024) | Net Sales Change (%) | Adjusted EBITDA (July 4, 2025) | Adjusted EBITDA (June 28, 2024) | Adjusted EBITDA Change (%) | | :-------------------- | :----------------------- | :------------------------ | :------------------- | :----------------------------- | :------------------------------ | :------------------------- | | Powered Vehicles Group | $123.5 | $117.8 | 4.9% | $16.4 | $15.9 | 3.1% | | Aftermarket Applications Group | $114.2 | $107.1 | 6.6% | $16.0 | $14.2 | 12.7% | | Specialty Sports Group | $137.2 | $123.6 | 11.0% | $30.4 | $29.2 | 4.1% | | Unallocated corporate expenses | - | - | - | $(13.5) | $(15.1) | (10.6)% | - Powered Vehicles Group net sales increased due to the Marzocchi acquisition, while Aftermarket Applications Group and Specialty Sports Group saw growth driven by increased aftermarket demand and stabilized bike sales, respectively163164165 Six months ended July 4, 2025 compared to six months ended June 28, 2024 Compares the company's operating results for the six months ended July 4, 2025, and June 28, 2024 Operating Results: Six Months Ended | Metric (in millions) | July 4, 2025 | June 28, 2024 | Change ($) | Change (%) | | :------------------- | :----------- | :------------ | :--------- | :--------- | | Net sales | $729.9 | $682.0 | $47.9 | 7.0% | | Cost of sales | $503.2 | $467.8 | $35.4 | 7.6% | | Gross margin | 31.1% | 31.4% | -0.3% | - | | Operating expenses | $458.7 | $186.7 | $272.0 | 145.7% | | (Loss) income from operations | $(232.1) | $27.5 | $(259.6) | (944.0)%| | Net (loss) income | $(257.0) | $1.9 | $(258.9) | (13,626.3)%| - Net sales increased by 7.0% due to stabilized bike sales, increased aftermarket product demand, and motorcycle business expansion, despite headwinds from high interest rates and vehicle costs169 - The Company reported a significant net loss of $(257.0) million, primarily driven by a $262.1 million goodwill impairment charge recognized during the period171176 Segment Review (Six Months) Reviews the financial performance of operating segments for the six-month periods Segment Performance: Six Months Ended | Segment (in millions) | Net Sales (July 4, 2025) | Net Sales (June 28, 2024) | Net Sales Change (%) | Adjusted EBITDA (July 4, 2025) | Adjusted EBITDA (June 28, 2024) | Adjusted EBITDA Change (%) | | :-------------------- | :----------------------- | :------------------------ | :------------------- | :----------------------------- | :------------------------------ | :------------------------- | | Powered Vehicles Group | $245.6 | $235.9 | 4.1% | $30.8 | $31.8 | (3.1)% | | Aftermarket Applications Group | $226.1 | $209.0 | 8.2% | $33.0 | $29.0 | 13.8% | | Specialty Sports Group | $258.2 | $237.1 | 8.9% | $53.8 | $53.3 | 0.9% | | Unallocated corporate expenses | - | - | - | $(28.7) | $(29.5) | (2.7)% | - Aftermarket Applications Group showed the strongest Adjusted EBITDA growth at 13.8%, driven by increased demand, while Powered Vehicles Group's Adjusted EBITDA decreased slightly due to higher R&D expenses178180 Liquidity and Capital Resources Assesses the company's ability to meet short-term and long-term financial obligations Cash Flow Activities Summary | Cash Flow Activity (in millions) | 6 Months Ended July 4, 2025 | 6 Months Ended June 28, 2024 | | :------------------------------- | :-------------------------- | :--------------------------- | | Net cash provided by operating activities | $37.5 | $36.0 | | Net cash used in investing activities | $(19.4) | $(26.6) | | Net cash used in financing activities | $(9.4) | $(10.7) | | Change in cash and cash equivalents | $9.8 | $(1.4) | - The Company expects cash on hand, cash flows from operations, and availability under its 2022 Credit Facility to be sufficient to fund operations for the next 12 months and beyond188 - The 2022 Credit Facility provides $650.0 million in revolving loans, maturing April 5, 2027, with a weighted-average interest rate of 6.41% as of July 4, 2025194195 - Recent developments, including new and expanded tariffs under the Trump administration and the enactment of the One Big Beautiful Bill Act (OBBBA), introduce cost and tax framework uncertainties, which the Company is evaluating200201 Item 3. Quantitative and Qualitative Disclosures About Market Risk States no material changes to market risk disclosures from the prior annual report Item 4. Controls and Procedures Details the evaluation of disclosure controls and internal control over financial reporting Evaluation of Disclosure Controls and Procedures Assesses the effectiveness of the company's disclosure controls and procedures - Management, with the participation of the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures as of July 4, 2025, and concluded they were effective at the reasonable assurance level207 Changes in Internal Control over Financial Reporting Reports on any material changes in internal control over financial reporting - There was no change in internal control over financial reporting identified during the period covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting208 Inherent Limitations on Effectiveness of Controls Acknowledges the inherent limitations that restrict the effectiveness of control systems - Management acknowledges that control systems provide only reasonable, not absolute, assurance of achieving objectives due to inherent limitations such as faulty judgments, simple errors, circumvention by individual acts or collusion, and management override209 PART II. OTHER INFORMATION Item 1. Legal Proceedings Details ongoing legal actions, including class action and derivative lawsuits - A federal securities class action was filed on February 20, 2024, alleging material misstatements and omissions regarding product demand and inventory levels, with the defendants denying all allegations210 - Two stockholder derivative complaints were filed in October 2024, premised on similar factual allegations as the securities fraud case, claiming officers and directors breached fiduciary duties211 - The court dismissed the initial amended complaint in the securities fraud case but granted leave to file a second amended complaint, which the defendants have moved to dismiss210 Item 1A. Risk Factors Highlights significant risks, particularly those related to trade policies and supply chain - New and expanded U.S. tariffs, including a universal 'reciprocal' tariff of 10% on all countries effective August 1, 2025, introduce additional costs and uncertainty into the supply chain215 - There is a risk that continued U.S. tariffs could be met with additional retaliatory tariffs on U.S.-produced exports, intensifying broader trade uncertainty and potentially impacting global economic conditions216 - The Uyghur Forced Labor Prevention Act (UFLPA) poses risks of product detentions, supply chain disruptions, and penalties if suppliers are found to have dealings, directly or indirectly, with entities on the UFLPA entities list217218 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Reports on common stock repurchases and the remaining authorization under the plan Common Stock Repurchases | Period | Total Number of Shares Purchased | Weighted-average Price Paid per Share | Approximate Dollar Value of Shares that May Yet be Purchased under the Plans or Programs | | :---------- | :------------------------------- | :------------------------------------ | :--------------------------------------------------------------------------------------- | | 4/5-5/9 | 32,406 | $20.65 | $250,000,000 | | 5/10-6/6 | 311 | $26.32 | $250,000,000 | | 6/7-7/4 | — | — | $250,000,000 | | Total | 32,717 | $20.70 | $250,000,000 | - The shares purchased were acquired from holders of restricted stock unit awards to satisfy tax-withholding obligations220 - As of July 4, 2025, $250.0 million remains available under the $300.0 million share repurchase plan authorized on November 1, 2023221 Item 3. Defaults Upon Senior Securities Confirms no defaults occurred on senior securities during the reporting period Item 4. Mine Safety Disclosures States that mine safety disclosures are not applicable to the company's operations Item 5. Other Information Discloses information regarding Rule 10b5-1 trading arrangements by officers and directors Item 6. Exhibits Lists all exhibits filed as part of the quarterly report on Form 10-Q Signatures Contains the official certifications by the company's principal financial and accounting officers
Fox(FOXF) - 2025 Q2 - Quarterly Report