Financial Data and Key Metrics Changes - First quarter sales grew 6% on an organic basis, with operating EBITDA of $788 million increasing 16% year over year, resulting in an operating EBITDA margin of 25.7%, up 240 basis points from the prior year [6][7][20] - Adjusted EPS for the quarter was $1.00, reflecting a 30% increase compared to the previous year [7][21] Business Line Data and Key Metrics Changes - Electronics Co. net sales for the first quarter were $1.1 billion, up 14% year over year, driven by a 16% increase in volume [22] - Industrials Co. first quarter net sales were $1.95 billion, flat year over year, with a 2% organic sales growth offset by currency headwinds [24][26] Market Data and Key Metrics Changes - Asia Pacific delivered 13% organic sales growth year over year, with China seeing a 20% increase driven by electronics and water [20] - Organic sales in Europe were up 4%, while North America remained flat due to softness in construction and auto markets [20] Company Strategy and Development Direction - The company is on track for the spin-off of its electronics business, named Qunity, with a planned separation date of November 1 [8][10] - Qunity is positioned to be a major player in the electronics materials and solutions market, with a strong focus on semiconductor markets and AI applications [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand in electronics, particularly in semiconductor advanced nodes and AI applications, with strong order patterns expected to continue [8][18] - The company is actively addressing tariff uncertainties and has identified actions to mitigate potential impacts, estimating a net cost impact of $60 million for 2025 [12][27] Other Important Information - The company has realigned its segment reporting structure in preparation for the upcoming separation, with results now reported as Electronics Co. and Industrials Co. [18] - The estimated cost exposure due to tariffs in 2025 is about $500 million, with mitigation actions expected to reduce the net impact significantly [12][27] Q&A Session Summary Question: Can you walk us through the exemption process regarding tariffs? - Management indicated that product exemptions are a smaller part of their mitigation strategy, focusing more on procurement and supply chain optimization [30][31] Question: What is the tariff exposure for each business segment? - The estimated net exposure for 2025 is split evenly between Electronics Co. and Industrials Co., with about $30 million each [43] Question: How much of the sales in China are under long-term contracts? - Approximately 70% of sales into China are specked-in materials, making it difficult for customers to switch to competitors [56] Question: What is driving the strong demand in the water business? - Demand is strong across various technologies, particularly reverse osmosis and ion exchange, with expectations for high single-digit growth for the year [61][62] Question: How does the company view its competitive positioning in the electronics market? - Management believes they have a strong competitive position due to their extensive customer relationships and application engineering support [102] Question: What are the expectations for the semiconductor market in China? - Management expects normalization in demand in China, with flat growth anticipated for the full year, while global demand remains strong [70][111]

Financial Data and Key Metrics Changes - First quarter sales grew 6% on an organic basis, with operating EBITDA of $788 million increasing 16% year over year, resulting in an operating EBITDA margin of 25.7%, up 240 basis points from the prior year [5][20]. - Adjusted EPS for the quarter was $1.00, reflecting a 30% increase from the previous year [21]. Business Line Data and Key Metrics Changes - **Electronics Co.**: First quarter net sales increased 14% year over year to $1.1 billion, driven by a 16% increase in volume, while prices decreased by 2% [22]. Operating EBITDA for Electronics Co. was $373 million, up 26% year over year, with a margin of 33.4%, up 340 basis points [23]. - **Industrials Co.**: First quarter net sales were flat at $1.95 billion, with a 2% organic sales growth offset by currency headwinds [24]. Operating EBITDA for Industrials Co. was $464 million, up 6% year over year, with a margin of 23.8%, up 130 basis points [26]. Market Data and Key Metrics Changes - Asia Pacific delivered 13% organic sales growth year over year, with China showing a 20% increase driven by electronics and water [19]. Europe saw a 4% organic sales increase, while North America remained flat due to soft construction and auto markets [20]. Company Strategy and Development Direction - The company is progressing on the spin-off of its electronics business, named Qunity, with a planned separation date of November 1 [6][8]. The new company aims to be a leading provider in the electronics materials and solutions sector, with a strong focus on semiconductor markets [13][15]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand in electronics, particularly in semiconductor advanced nodes and AI applications, and noted strong order patterns through April [6][18]. The company is also actively addressing tariff uncertainties and has identified actions to mitigate potential impacts [11][28]. Other Important Information - The company expects a net cost impact of tariffs of about $60 million for 2025, primarily affecting the second half of the year [28]. The financial guidance for 2025 remains unchanged, with net sales estimated between $12.8 billion and $12.9 billion [27]. Q&A Session Summary Question: Can you walk us through the exemption process regarding tariffs? - Management indicated that product exemptions are a smaller part of their mitigation strategy, focusing more on procurement and supply chain optimization [31][32]. Question: What is the tariff exposure split between Electronics Co. and Industrials Co.? - The estimated net exposure for 2025 is evenly split, with about $30 million for each segment, representing around 6% of their COGS [45][46]. Question: How much of the sales in China are under long-term contracts? - Approximately 70% of sales into China are specked-in materials, making it difficult for customers to switch to competitors [60]. Question: What is driving the strong demand in the water business? - Demand is strong across various technologies, particularly reverse osmosis and ion exchange, with expectations for high single-digit growth for the year [65][66]. Question: How does the company view its competitive positioning in the electronics market? - Management feels confident about their competitive position, emphasizing strong customer relationships and the ability to support advanced technologies [107]. Question: What are the expectations for the China market in the second half of the year? - The company anticipates normalization in demand, with flat year-over-year expectations, while still expecting strong global market conditions [75][116].

Electronics Separation - DuPont is targeting November 1, 2025, to complete the separation of its Electronics business via a spin-off transaction, creating a new independent company named "ElectronicsCo" (later named Qnity)[3, 12, 17] - The separation does not require a shareholder vote but is subject to customary conditions [4] - Effective Q1 2025, DuPont realigned its management and reporting structure in light of the intended separation, reporting the Electronics business separately [5] Financial Performance - 1Q 2025 - Net sales reached $3.1 billion, with 6% organic growth year-over-year[12, 19] - Operating EBITDA increased by 16% year-over-year to $788 million, with a margin expansion of 240 basis points to 25.7%[12, 19] - Adjusted EPS increased by 30% year-over-year to $1.03 per share[12, 20] - Transaction-adjusted free cash flow was $212 million, with a conversion rate of 49%[20] Segment Performance - 1Q 2025 - ElectronicsCo's net sales were $1.118 billion, with organic growth of 14% driven by a 16% increase in volume[24] - ElectronicsCo's Operating EBITDA was $373 million, with a margin of 33.4%, up 340 basis points year-over-year[26, 30] - IndustrialsCo's net sales were $1.948 billion, with organic growth of 2%[32] - IndustrialsCo's Operating EBITDA was $464 million, with a margin of 23.8%, up 130 basis points year-over-year[34, 37] Outlook - The company maintains its FY25 guidance with net sales of $12.8 - $12.9 billion and Adjusted EPS of $4.30 - $4.40[12, 38] - The company estimates a net cost impact of approximately $60 million (approximately $0.10 per share) from tariffs, mainly impacting the second half of 2025[38]

Financial Data and Key Metrics Changes - The company reported Q1 sales of $617 million, with core sales increasing by 20 basis points year over year despite a negative impact of approximately 140 basis points from currency exchange rates [12][14] - Adjusted EBITDA margin was 12.8%, down 120 basis points from the previous year, primarily due to foreign exchange impacts [14][20] - Adjusted EPS for the quarter was $0.24, slightly above expectations but down $0.02 compared to the same quarter last year [14][23] Business Line Data and Key Metrics Changes - Specialty Products and Technologies segment saw a decline of 70 basis points in core revenue year over year, while Equipment and Consumables segment increased by 170 basis points [20][22] - Consumables showed strong growth across most categories and geographies, particularly in North America [12][13] - The orthodontics business experienced growth in Spark and Brackets and Wires outside of China, while the premium implants segment continued to grow [21][22] Market Data and Key Metrics Changes - The global dental market remained stable in Q1, with underlying demand similar to the second half of 2024 [9][35] - Positive growth was noted in North America, Japan, and emerging markets, while Europe remained flat [27] - Consumer confidence indices in the U.S. have deteriorated, but this has not yet impacted the company's Q1 results [10][35] Company Strategy and Development Direction - The company is focused on a value creation plan that includes growth in consumables, Nobel, and orthodontics, as well as price capture across its portfolio [25][26] - A tariff task force has been established to manage the impact of tariffs and optimize supply chain flexibility [31][32] - The company maintains its 2025 guidance of 1% to 3% core growth and adjusted EBITDA margins of approximately 14% [11][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the dental market's long-term stability despite current macroeconomic uncertainties [27][35] - The company is navigating geopolitical uncertainties and has implemented cost controls to enhance operational productivity [10][11] - Future performance is expected to benefit from the unwinding of revenue deferrals in the second half of the year [17][19] Other Important Information - The company has made progress on its $250 million share repurchase program, purchasing $19 million worth of stock in Q1 [23] - Free cash flow was an outflow of $5 million in Q1, typical for the first quarter due to timing of incentive compensation [15][22] Q&A Session Summary Question: Current tariff exposure and mitigation strategies - The company has significant tariff exposure from U.S. goods imported into China and vice versa, with ongoing efforts to shift supply chains to mitigate impacts [42][43] Question: April trends and volume-based dynamics - April has started positively, with no major shifts in procedure types observed, indicating stability in the market [50][51] Question: Gross and net impacts from tariffs - The guidance includes current tariff activity, with confidence in mitigating impacts through various strategies [56][58] Question: Expectations for VBP in China - The ortho VBP process is progressing as expected, with anticipated benefits in the second half of the year [67][69] Question: Performance of premium and challenger implants - Challenger experienced a dip in Q1 due to fewer billing days, but no change in trajectory is expected for the year [92][94] Question: Spark average selling price trends - No major change in Spark ASP was noted, with consistent pricing and value capture expected [100][101] Question: Size of the China business and inventory management - The China business represents a high single-digit percentage of total revenue, with inventory held in China and ongoing shipments incurring tariffs [105][106]

Financial Data and Key Metrics Changes - The company reported Q1 sales of $617 million, with core sales increasing by 20 basis points year over year despite a negative impact of approximately 140 basis points from currency exchange rates [12][14] - Adjusted EBITDA margin was around 12.8%, down 120 basis points from the previous year, primarily due to foreign exchange impacts [14][19] - Adjusted EPS for the quarter was $0.24, slightly above expectations but down $0.02 compared to the same quarter last year [14][22] Business Line Data and Key Metrics Changes - Specialty Products and Technologies segment saw a core revenue decline of 70 basis points year over year, while Equipment and Consumables segment increased by 170 basis points [19][21] - Consumables showed strong growth across most categories and geographies, particularly in North America [12][13] - The orthodontics business experienced growth in Spark and Brackets and Wires outside of China, despite challenges in the Chinese market [20][25] Market Data and Key Metrics Changes - The global dental market remained stable in Q1, with underlying demand similar to the second half of 2024 [9][35] - Positive growth was noted in North America, Japan, and emerging markets, while Europe remained flat [26] - Consumer confidence indices in the U.S. have deteriorated, but this has not yet impacted the company's Q1 results [10][35] Company Strategy and Development Direction - The company is focused on a value creation plan that includes growth in consumables, Nobel, and orthodontics, as well as price capture across its portfolio [25][26] - A tariff task force has been established to manage the impacts of tariffs and optimize supply chain flexibility [31][32] - The company maintains its 2025 guidance of 1% to 3% core growth and adjusted EBITDA margins of approximately 14% [11][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the dental market's long-term stability despite current macroeconomic uncertainties [27][35] - The company is navigating challenges through cost controls and operational improvements, with a focus on maintaining strong customer service levels [10][27] - Future performance is expected to benefit from the unwinding of revenue deferrals in the second half of the year [16][87] Other Important Information - The company has made progress on its $250 million share repurchase program, purchasing $19 million worth of stock in Q1 [22] - Free cash flow was an outflow of $5 million in Q1, typical for the first quarter due to timing of incentive compensation [15][21] Q&A Session Summary Question: Current tariff exposure and mitigation strategies - The company detailed its tariff exposure primarily in U.S. goods imported into China and vice versa, with ongoing efforts to shift supply chains to mitigate impacts [41][42][43] Question: April trends and volume-based dynamics - Management noted that April has started positively, with no significant shifts in procedure types observed [49][50][51] Question: Gross and net impacts from tariffs - The guidance includes current tariff activity, with confidence in mitigating impacts but acknowledging wider error bars compared to previous guidance [56][57][58] Question: Expectations for implants and product launches - The Challenger segment experienced a decline due to fewer billing days, but no change in trajectory is anticipated for the year [91][93][95] Question: Spark average selling price trends - No major change in Spark ASP was reported, with consistent pricing and value capture noted [100][101] Question: Size of the China business and inventory management - The China business represents a high single-digit percentage of total revenue, with inventory held in China and ongoing shipments incurring tariffs [105][106][107]

Financial Data and Key Metrics Changes - First quarter revenues declined by 1% to $143 million compared to the same period in 2024, with adjusted EBITDA of $23 million, down from $24 million year-over-year [27][30][8] - Net loss for the first quarter was $1 million, an improvement from a net loss of $5 million in the first quarter of 2024 [30] - Adjusted net income increased to $7 million or $0.05 per diluted share, compared to $5 million or $0.04 per diluted share in the same period last year [30] Business Line Data and Key Metrics Changes - Grill sales increased by 13% year-over-year, benefiting from the launch of the new Woodridge series [17][20] - Consumables revenues decreased by 6% to $30 million, largely in line with expectations [27] - Accessories revenue fell by 27% to $26 million, primarily due to challenges faced by the Meter product line [27][24] Market Data and Key Metrics Changes - North American revenues rose by 6%, while revenues from the rest of the world dropped by 47%, significantly impacted by Meter's performance [28] - The first quarter typically experiences slower sales in the outdoor cooking industry, but sell-through for grills remained positive compared to the previous year [18] Company Strategy and Development Direction - The company is focused on mitigating tariff impacts through cost reductions, sourcing diversification, and strategic pricing increases [11][12][13] - Plans to reduce production in China significantly by 2026 while enhancing relationships with manufacturing partners [13] - The company has suspended forward guidance for fiscal 2025 due to uncertainties in the macroeconomic environment and consumer demand [16][34] Management's Comments on Operating Environment and Future Outlook - Management highlighted the challenges posed by tariffs and declining consumer sentiment, emphasizing the need for strategic navigation through the current macroeconomic landscape [9][10] - The company remains optimistic about its ability to offset tariff impacts and is committed to long-term growth strategies despite short-term challenges [26][36] Other Important Information - The Woodridge series received strong consumer reception, achieving an average rating of 4.8 stars, marking the highest rating for a product launch in the company's history [21] - The company is actively managing inventory levels and has reduced purchase orders to avoid overstocking amid uncertain demand [35][55] Q&A Session Summary Question: Can you provide some color around strategic price increases across your product portfolio? - Management indicated that pricing decisions were made based on historical sell-through data and product elasticity, with a focus on premium positioning and innovation [38][39] Question: Can you talk about the Meter segment and capital allocation going forward? - Management acknowledged short-term challenges in the Meter segment but emphasized a long-term strategy focused on wholesale channels and operational efficiency [44][46] Question: Have you sensed a shift in retailer willingness to take on inventory? - Management noted no significant reluctance from retailers to take inventory, but there has been a shift towards domestic fulfillment due to tariff implications [50][52] Question: Can you clarify the tariff situation regarding products from China? - Management confirmed that grills from China are subject to a total tariff of 45%, while accessories vary based on sourcing [58][60] Question: What is the approach to marketing this year? - The company is focusing on sales activation activities and in-store marketing, while top-of-funnel marketing has been deprioritized due to the uncertain environment [89][90]

Financial Data and Key Metrics Changes - First quarter revenues declined by 1% to $143 million compared to the same period in 2024, with adjusted EBITDA of $23 million, down from $24 million year-over-year [6][24][27] - Net loss for the first quarter was $1 million, an improvement from a net loss of $5 million in the first quarter of 2024 [27] - Adjusted net income increased to $7 million or $0.05 per diluted share, compared to $5 million or $0.04 per diluted share in the same period last year [27] Business Line Data and Key Metrics Changes - Grill sales increased by 13% year-over-year, benefiting from the launch of the new Woodridge series [15][24] - Consumables revenues decreased by 6% to $30 million, in line with expectations, due to a reduction in wood pellet and soup consumables [21][24] - Accessories revenue fell by 27% to $26 million, primarily due to challenges faced by Meter in the smart thermometer category [22][24] Market Data and Key Metrics Changes - North American revenues rose by 6%, while revenues from the rest of the world dropped by 47%, largely due to Meter's performance [25] - The first quarter typically experiences slower sales in the outdoor cooking industry, but sell-through for grills remained healthy into the second quarter [16][24] Company Strategy and Development Direction - The company is focused on mitigating tariff impacts through cost reductions, sourcing diversification, and strategic pricing increases [10][12][14] - Plans to reduce production in China significantly by 2026 while enhancing relationships with manufacturing partners [11][12] - The company has suspended forward guidance for fiscal 2025 due to uncertainties in the macroeconomic environment and consumer demand [14][31] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by tariffs and declining consumer sentiment, emphasizing the importance of navigating the current macroeconomic climate [7][8] - The company is optimistic about its ability to offset tariff impacts through various mitigation strategies, although consumer demand remains a significant unknown [10][29] - Management expressed confidence in the long-term value of the Meter brand despite short-term pressures [42][44] Other Important Information - The Woodridge series received strong consumer reception, achieving an average rating of 4.8 stars across various platforms [19][20] - The company is actively managing inventory levels and has reduced purchase orders to avoid overstocking amid uncertain demand [32][53] Q&A Session Summary Question: Can you provide insights on strategic price increases across your product portfolio? - Management indicated that pricing decisions were made based on historical sell-through data and product elasticity, with a focus on premium positioning [35][36] Question: How is the Meter segment performing and what are the capital allocation plans? - Management acknowledged short-term challenges for Meter but emphasized a long-term strategy focused on wholesale channels and cost structure optimization [42][43] Question: Has there been a shift in retailer willingness to take on inventory? - Management noted no significant reluctance from retailers but mentioned a shift towards domestic fulfillment due to tariff implications [48][49] Question: Can you clarify the tariff situation for products sourced from China? - Management confirmed that grills from China are subject to a total tariff of 45%, while accessories vary based on sourcing [57][64] Question: What is the current status of the Walmart pellet rollout? - Management expressed excitement about the partnership with Walmart, noting it meets consumer demand for convenience [68][69]

TRAEGER INVESTOR PRESENTATION. FIRST QUARTER 2025 SAFE HARBOR STATEMENT This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of l995. All statements contained in this presentation that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements regarding our mitigation efforts to offset the direct impact of tariffs, our implementation of strategic actions to stabiliz ...

Financial Performance - Value-added (VA) sales reached $259.3 million, a 1% increase year-over-year[9] - Adjusted EBITDA was $48.7 million, representing 18.8% of VA sales, an 8% increase year-over-year[9] - Adjusted EPS increased by 18% year-over-year to $1.13[9] - The company saw a $35 million year-over-year improvement in free cash flow due to reduced working capital[9] Segment Performance - Performance Materials segment value-added sales were $160.0 million, up 3% year-over-year, with adjusted EBITDA of $40.9 million, up 15% year-over-year[38][39] - Electronic Materials segment value-added sales were $77.8 million, with adjusted EBITDA of $13.3 million[42][43][44] - Precision Optics segment value-added sales were $21.5 million, with an adjusted EBITDA loss of $0.1 million[46][47][48] Market Performance - Semiconductor market VA sales increased by 7% to $68.3 million due to improving demand in data storage and advanced logic & memory applications[14] - Energy market VA sales increased significantly by 47% to $19.6 million, driven by a large nuclear energy shipment[14] - Consumer Electronics market VA sales decreased by 17% to $46.6 million due to general market uncertainty[14] Financial Outlook - The company expects Q2 to be slightly better than Q1[23] - The company anticipates a $0.10 to $0.15 impact from China tariffs in Q2 and a potential $0.40 to $0.50 impact in the second half of the year[23] - The company expects to deliver a 20%+ adjusted EBITDA margin for the full year[23]

Financial Data and Key Metrics Changes - The company expects EPS to decline about 30% for the first half of the year, with Q2 expected to be down less than Q1, which was down over 30% [12][13][14] - Gross margin for Q2 is expected to decrease by approximately 700 basis points, influenced by tariff components and increased SG&A expenses [14][13] Business Line Data and Key Metrics Changes - The company reported a 10% increase in its business, with a 100 basis point increase in market share, particularly in the sweets category [23] - The company anticipates low single-digit growth in everyday chocolate for the second half of the year, driven by strong innovation [35] Market Data and Key Metrics Changes - The company has seen strong growth in international markets, particularly in Brazil, where organic sales grew double digits [98] - The competitive environment in international markets has normalized, aiding the company's performance [98] Company Strategy and Development Direction - The company is focused on mitigating tariff impacts through various strategies, including lobbying and operational adjustments [10][9] - The company aims to continue growing its chocolate business while expanding into the salty snacks and sweets categories, targeting younger and more diverse demographics [79][78] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in a path to earnings growth next year, despite current tariff challenges [20][21] - The company is actively monitoring consumer sentiment and adapting its strategies to maintain market share amid a weak consumer environment [31][30] Other Important Information - The company is not planning any buybacks for the year but remains open to capital allocation opportunities depending on how the year unfolds [99] - The company is investing in innovation and marketing to ensure long-term growth, particularly in the chocolate category [113][114] Q&A Session Summary Question: What is the risk of tariff expenses in Q3 and Q4? - Management indicated that unmitigated tariff impacts could reach up to $100 million per quarter, primarily from cocoa and Canadian retaliatory tariffs [8][9] Question: How should investors think about the magnitude of EPS decline in Q2? - Management expects EPS to be down about 30% for the first half, with Q2 showing a decline less than Q1 due to strong net sales [12][14] Question: What is the outlook for earnings growth next year? - Management maintains a positive outlook for earnings growth next year, despite the challenges posed by tariffs [20][21] Question: How is the company addressing consumer trends towards healthier eating? - Management noted that while consumer sentiment is weak, the chocolate category remains resilient, and they are focusing on premium and permissible products [31][30] Question: What is the competitive landscape in the U.S. chocolate market? - Management reported no significant changes in the competitive landscape, with smaller players softening and larger players increasing innovation [124] Question: How will the company approach pricing in light of cocoa prices? - Management confirmed that pricing will increase in Q2 and Q3 as part of their seasonal pricing strategy [128]