Core Insights - Build-A-Bear Workshop reported record full-year results for fiscal 2025, with revenue reaching nearly $530 million, marking a growth of approximately 7% year-over-year, and pretax income of $67.2 million, despite facing $11 million in tariff-related costs [2][6][8] Financial Performance - For Q4, total revenue was $154.5 million, a 2.7% increase year-over-year, while net retail sales were $139.5 million, remaining essentially flat [1] - The company experienced a gross margin of 55.2% in Q4, down 140 basis points from the previous year due to tariff impacts, partially offset by selective price increases [7] - Full-year EPS was $3.99, reflecting a 5% increase, with tariffs and related costs reducing EPS by approximately $0.65 [8] Operational Developments - The company plans to open at least 50 net new locations in 2026, focusing on partner-operated models, and has doubled its international footprint to 36 countries [5][10][12] - Build-A-Bear added 11 net new experience locations in Q4, bringing the total to 64 [9] Digital Strategy and Challenges - E-commerce demand fell by 13.6% in Q4 and 5.5% for the full year, attributed to traffic declines and difficult comparisons against strong prior-year launches [7] - The company is adapting to significant digital traffic disruptions caused by AI-driven changes in Google’s search algorithms, leading to a double-digit decline in click-through rates [4][13] Brand Expansion and Product Development - The Mini Beans product line has sold over 3 million units and secured placement in approximately 1,500 Walmart stores [14] - The launch of the animated series "Kabu" has garnered over 1 million views, contributing to brand engagement and sales [15] Future Guidance - The company anticipates mid-single-digit revenue growth for 2026, with a projected $16 million impact from tariffs and related costs [19] - First-quarter revenue is expected to be flat year-over-year, with growth anticipated to accelerate throughout the year [18] Leadership Transition - CEO Sharon John announced her retirement, with COO Chris Hurt set to take over as CEO effective June 11, 2026 [3][4][21]

Financial Data and Key Metrics Changes - Total revenues for Q4 2025 were $154.5 million, an increase of 2.7% year-over-year, with full-year revenues reaching $529.8 million, up 6.7% from the previous year [20][24] - Pre-tax income for Q4 was $21.5 million, down from $27.5 million last year, impacted by approximately $6 million in tariffs and related costs [23] - Earnings per share for the full year were $3.99, representing a 5% growth, although tariffs reduced EPS by approximately $0.65 [24] Business Line Data and Key Metrics Changes - Net retail sales for Q4 were $139.5 million, essentially flat compared to last year, while e-commerce demand decreased by 13.6% for the quarter [20][22] - Commercial revenue, reflecting wholesale sales, increased by 42.2% for the quarter and 23.4% for the year, indicating strong growth in this segment [22] Market Data and Key Metrics Changes - The company expanded its international footprint significantly, entering eight new countries in 2025, doubling its international presence to 36 countries in two years [7][11] - The U.S. market saw continued expansion with new store openings, including co-branded locations with Hello Kitty [9][10] Company Strategy and Development Direction - The company focuses on three strategic initiatives: expanding experiential retail locations, advancing digital transformation, and leveraging brand equity for new revenue streams [6][11] - Plans for 2026 include opening at least 50 net new locations, primarily in the partner-operated model, to support international growth [10][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's resilience despite challenges from tariffs and supply chain disruptions, highlighting a record revenue year and ongoing strategic initiatives [4][16] - The outlook for 2026 anticipates mid-single-digit revenue growth, with pre-tax income expected to range from a decline to low single-digit growth due to tariff impacts [25][26] Other Important Information - The CEO announced retirement plans, with the COO set to take over, emphasizing a planned succession process [3][29] - The company has successfully launched new products, such as Mini Beans, which have generated significant sales and expanded distribution [14][15] Q&A Session Summary Question: Discussion on personalization and expansion - Management acknowledged the importance of in-store personalization and customization, with plans to expand these offerings in key markets [49][50] Question: Inventory management and tariff impacts - The CFO discussed elevated inventory levels due to tariffs and ongoing investments to support growth, emphasizing proactive management strategies [51][52] Question: Long-term investments and digital business - Management confirmed ongoing strategic investments in digital capabilities and infrastructure to support future growth, despite short-term impacts [57][58] Question: International expansion and new partners - The COO detailed recent international expansions and the strategy to open new locations in both existing and new markets [61][62] Question: Pre-tax margin guidance - The CFO explained the expected impact of tariffs and investments on pre-tax margins, indicating a cautious outlook for the upcoming year [65][66]

Financial Data and Key Metrics Changes - Total revenues for fiscal 2025 reached approximately $529.8 million, representing a 6.7% year-over-year increase, marking the highest revenue in the company's history [24][31] - Pre-tax income for the year was $67.2 million, slightly impacted by approximately $11 million in tariff-related costs, with earnings per share at $3.99, reflecting a 5% growth [25][31] - For the fourth quarter, total revenues were $154.5 million, a 2.7% increase year-over-year, while net retail sales were essentially flat at $139.5 million [21][22] Business Line Data and Key Metrics Changes - The direct-to-consumer business saw a 13.6% decrease in e-commerce demand for the fourth quarter, primarily due to traffic declines and tough comparisons from previous strong product launches [23] - Commercial revenue, which includes wholesale sales, increased by 42.2% for the quarter and 23.4% for the year, indicating strong growth in this segment [23] Market Data and Key Metrics Changes - The company expanded its international footprint significantly, entering eight new countries in 2025, doubling its international presence to 36 countries over two years [7][64] - The U.S. market remains a stronghold, with the company continuing to expand its corporate store footprint, including new experiential locations [9][10] Company Strategy and Development Direction - The company is focused on three strategic initiatives: expanding experiential retail locations, advancing digital transformation, and leveraging brand equity to create new revenue streams [6][11] - The new CEO, Chris Hurt, plans to continue the company's growth strategy, emphasizing organic growth, location expansion, wholesale and outbound licensing, and enhancing gifting and personalization opportunities [36][39] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges from tariffs and supply chain disruptions but expressed confidence in the company's resilience and ability to navigate these issues [4][16] - The outlook for 2026 anticipates mid-single-digit revenue growth, driven by the addition of at least 50 new experience locations, primarily in international markets [26][28] Other Important Information - The company has successfully launched a new line of pre-stuffed branded Mini Beans, achieving over 3 million units sold and securing a multi-million dollar wholesale order with Walmart [15][16] - The transition of leadership from Sharon John to Chris Hurt is part of a planned succession process, with expectations for continued growth under Hurt's leadership [3][30] Q&A Session Summary Question: Discussion on personalization and in-store experiences - Management highlighted the importance of expanding personalization options in-store, including embroidery and customization, as a key growth area [48][50] Question: Inventory management and tariff impacts - The CFO discussed elevated inventory levels due to tariffs and ongoing investments to support growth, emphasizing proactive management strategies [52][54] Question: Long-term investments in digital and operations - Management confirmed ongoing strategic investments, particularly in digital capabilities and international expansion, with a focus on long-term growth [59][61] Question: Momentum in commercial and franchise businesses - The company is exploring new partners and countries for expansion, with significant opportunities identified in existing markets like Italy and Germany [63][64] Question: Pre-tax margin guidance and influencing factors - The CFO explained the expected impact of tariffs and investments on pre-tax margins, indicating a range of mid-single-digit decline to low single-digit growth for the upcoming year [68][70]

Financial Data and Key Metrics Changes - Total revenues for fiscal 2025 reached $529.8 million, representing a 6.7% increase year-over-year, marking the highest revenue in the company's history [24][16] - Pre-tax income was $67.2 million, slightly impacted by approximately $11 million in tariff-related costs, with earnings per share at $3.99, reflecting a 5% growth for the year [24][19] - Gross margin for Q4 was 55.2%, down 140 basis points compared to the previous year, primarily due to tariffs [22] Business Line Data and Key Metrics Changes - Net retail sales for Q4 were $139.5 million, essentially flat year-over-year, while e-commerce demand decreased by 13.6% for the quarter [20][21] - Commercial revenue, which includes wholesale sales, increased by 42.2% for the quarter and 23.4% for the year, indicating strong growth in this segment [22] Market Data and Key Metrics Changes - The company expanded its international footprint significantly, entering eight new countries in 2025, doubling its international presence to 36 countries [7][4] - The U.S. market remains a stronghold, with the company planning to open at least 50 new experience locations in 2026, primarily in international partner-operated formats [10][25] Company Strategy and Development Direction - The company focuses on three strategic initiatives: expanding experiential retail locations, advancing digital transformation, and leveraging brand equity for new revenue streams [5][11] - The new CEO, Chris Hurt, aims to continue the company's growth by optimizing the omni-channel model and expanding the global footprint through various business models [34][36] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges from tariffs and supply chain disruptions but expressed confidence in the company's resilience and ability to execute long-term strategies [5][16] - The outlook for 2026 anticipates mid-single-digit revenue growth, with pre-tax income expected to range from a decline to low single-digit growth due to ongoing tariff impacts [25][26] Other Important Information - The company launched a new animated series, Kabu, which has already garnered over 1 million views, showcasing its efforts to build a proprietary IP ecosystem [15][14] - The transition of leadership from Sharon John to Chris Hurt is part of a planned succession process aimed at sustaining the company's growth trajectory [3][29] Q&A Session Summary Question: Discussion on expansion and personalization opportunities - Management highlighted the importance of in-store personalization and customization, particularly in tourist locations, and plans to roll out these features more broadly [49][50] Question: Inventory management and tariff impacts - The CFO discussed elevated inventory levels due to tariffs and investments for growth, emphasizing proactive management strategies to mitigate impacts [51][53] Question: Long-term investments in digital and operations - Management confirmed ongoing strategic investments in digital capabilities and operations, with a focus on long-term growth despite short-term challenges [58][60] Question: International expansion and new partners - The company opened in eight new countries and plans to continue expanding with both new and existing partners, particularly in markets like Italy and Germany [63][64] Question: Pre-tax margin guidance and influencing factors - The CFO explained the expected impact of tariffs on pre-tax margins, with a range reflecting both costs and strategic investments for future growth [67][68]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 grew nearly 3% to almost $123 million, while pre-tax income declined by $2 million to nearly $11 million, impacted by approximately $4 million in negative tariff effects [5][22] - Year-to-date revenue increased over 8% to over $375 million, with pre-tax income rising by 15% to almost $46 million, also inclusive of about $5 million in negative tariff impact [5][6] - Gross margin was 53.7%, a decline of 40 basis points compared to last year, primarily due to tariffs, which reduced gross profit by about $4 million in the quarter [24] Business Line Data and Key Metrics Changes - Net retail sales for the quarter were $112.3 million, an increase of 2.5% [22] - Direct-to-consumer sales showed solid performance in August and September but declined by 10.8% in October due to challenging comparisons from a strong license product launch last year [23] - Commercial revenue, primarily from wholesale sales, grew 4.2% for the quarter and 15.3% year-to-date, with expectations of over 20% growth for the year [24] Market Data and Key Metrics Changes - The company added 24 net new experience locations, with 70% of those openings outside the United States, bringing the total to 651 locations across 33 countries [8][10] - The Mini Beans product line saw a 60% increase in sales during Q3, approaching 3 million units sold [16][49] Company Strategy and Development Direction - The company aims to expand its experiential retail footprint, advance digital transformation, and leverage brand equity beyond workshops while returning capital to shareholders [7][14] - The strategy includes opening new co-branded locations and expanding the Mini Beans collection to various retail environments [11][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving record revenue of over $500 million for fiscal 2025, despite ongoing tariff headwinds [3][6] - The company is focused on mitigating tariff impacts through cost management and selective price increases, with expectations of a reduced tariff rate in the coming year [35][36] Other Important Information - The company returned over $26 million to shareholders through dividends and buybacks, contributing to more than 24% EPS growth for the first three quarters of the fiscal year [6][25] - The company maintained a strong balance sheet with $27.7 million in cash and no borrowing under its revolving credit facility [26] Q&A Session Summary Question: Can you elaborate on the tariff impact and mitigation strategies for next year? - Management indicated that tariffs for the current year are expected to total less than $11 million, with ongoing efforts to mitigate costs through partnerships and selective price increases [34][35] Question: How is the diversification in pricing affecting customer demographics? - Management noted that 40% of sales are to teens and adults, allowing for greater pricing flexibility and attracting a broader customer base [40][41] Question: What trends are observed in promotional activity this quarter? - Management stated that promotional activity was managed more stringently, resulting in lower discount rates compared to previous quarters [46][47] Question: Can you provide insights on Mini Beans sales and new product introductions? - Management expressed excitement about Mini Beans, highlighting a 60% increase in sales and expansion into various retail channels [48][49] Question: How do high-profile movie tie-ins affect sales? - Management acknowledged that while movie tie-ins can drive sales, the overall performance is influenced by a broader assortment of products [56][58] Question: Will having multiple locations in large malls provide leverage in lease negotiations? - Management confirmed that increased revenue and foot traffic from multiple locations can create leverage in discussions with mall partners [60][61]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 grew nearly 3% to almost $123 million, while pre-tax income declined by $2 million to nearly $11 million, impacted by approximately $4 million in tariffs [5][22] - Year-to-date revenue increased over 8% to over $375 million, with pre-tax income rising by 15% to almost $46 million, also inclusive of about $5 million in tariff impacts [5][22] - Earnings per share (EPS) grew over 24% for the first three quarters of the fiscal year, reflecting strong shareholder returns totaling over $26 million through dividends and buybacks [6][25] Business Line Data and Key Metrics Changes - Direct-to-consumer sales showed solid performance in August and September but declined in October due to external factors, with e-commerce demand down 10.8% for the quarter [23][24] - Commercial revenue, primarily from wholesale sales, grew 4.2% for the quarter and 15.3% year-to-date, with expectations of over 20% growth for the year [24] Market Data and Key Metrics Changes - Domestic store traffic outperformed national benchmarks, although overall traffic saw a slight decline [23] - The company opened 24 net new experience locations, with 70% outside the U.S., bringing total locations to 651 across 33 countries [8][9] Company Strategy and Development Direction - The company aims to expand its experiential retail footprint, advance digital transformation, and leverage brand equity beyond workshops while returning capital to shareholders [7][14] - The introduction of Mini Beans collectibles has been successful, with nearly 3 million units sold and a 60% increase in sales during Q3 [16][49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving record revenue of over $500 million for fiscal 2025, despite ongoing tariff headwinds [3][27] - The company is focused on mitigating tariff impacts through cost management and strategic initiatives, including diversifying its market presence [35][37] Other Important Information - The company has maintained a strong balance sheet with cash and cash equivalents totaling $27.7 million and no borrowing under its revolving credit facility [25][26] - The company is committed to executing its strategic objectives while delivering consistent value to shareholders through disciplined capital allocation [28] Q&A Session Summary Question: Tariff impact and mitigation strategies - Management acknowledged approximately $10 million in tariff expenses for the year and discussed ongoing efforts to mitigate these costs through partnerships and selective price increases [34][36] Question: Diversification in pricing and customer demographics - Management highlighted the success of Mini Beans and higher-priced items, noting that diversification attracts different customer segments, including teens and adults [40][41] Question: Promotional activity in the quarter - Management stated that promotional activity was managed more stringently, resulting in lower discount rates while focusing on enhancing customer experience [46][47] Question: Trends in Mini Beans sales and new SKU introductions - Management expressed excitement about Mini Beans, noting strong sales and expansion into various retail environments, indicating a successful strategy for growth [48][49] Question: Impact of high-profile movie tie-ins on sales - Management discussed the unpredictability of sales related to movie tie-ins, emphasizing a broader assortment as a key driver for Black Friday success [56][58] Question: Expansion into multiple locations in large malls - Management confirmed that having multiple locations in major malls enhances leverage in lease negotiations and contributes to increased foot traffic [60][61] Question: Customer behavior during government shutdown - Management noted a slowdown in traffic during the government shutdown but reported a rebound in November, indicating resilience in customer spending [68][69] Question: Opportunities in wholesaling Mini Beans - Management identified wholesaling Mini Beans as a significant growth opportunity, with plans to expand into additional retail channels [71][72]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 grew nearly 3% to almost $123 million, while pre-tax income declined by $2 million to nearly $11 million, impacted by approximately $4 million in negative tariff effects [5][20] - Year-to-date revenue increased over 8% to over $375 million, with pre-tax income rising by 15% to almost $46 million, also inclusive of about $5 million in negative tariff impact [5][20] - Gross margin was 53.7%, a decline of 40 basis points compared to last year, primarily due to tariffs, which reduced gross profit by about $4 million in the quarter [23][24] Business Line Data and Key Metrics Changes - Direct-to-consumer sales saw a decline of 10.8% in e-commerce demand, primarily due to challenging comparisons from a strong license product launch last year [22] - Commercial revenue, mainly from wholesale sales, grew 4.2% for the quarter and 15.3% year-to-date, with expectations of over 20% growth for the year [23][24] Market Data and Key Metrics Changes - Domestic store traffic outperformed the national benchmark, although there was a slight transaction decrease driven by a 1% decline in traffic [21] - The company opened 24 net new experience locations, with 70% of those outside the United States, bringing the total to 651 locations across 33 countries [7][8] Company Strategy and Development Direction - The company aims to expand its experiential retail footprint, advance digital transformation, and leverage brand equity beyond workshops while returning capital to shareholders [6][27] - The introduction of the Mini Beans collection has been successful, with nearly 3 million units sold and over 60% growth in Q3 alone, indicating a strategy to reach broader markets [15][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in reaffirming full-year guidance, expecting revenue to exceed $500 million for the first time in company history despite ongoing tariff headwinds [3][5] - The company is focused on executing strategic objectives while managing external challenges, including tariffs and inflationary pressures [27] Other Important Information - The company returned over $26 million to shareholders through dividends and buybacks, contributing to more than 24% EPS growth for the first three quarters of the fiscal year [5][24] - The company has maintained significant flexibility with about $70 million remaining under its board-approved repurchase authorization [24] Q&A Session Summary Question: What are the opportunities to reduce tariff impacts next year? - Management indicated that while tariffs will continue to impact, they are working on mitigating costs through partnerships and selective price increases [30][32] Question: How is the diversification in pricing affecting customer engagement? - Management noted that diversification allows for appealing to different customer segments, with 40% of sales coming from teens and adults, enhancing pricing flexibility [35][38] Question: What trends are seen with Mini Beans sales? - Mini Beans have shown strong sales growth, with plans to expand distribution beyond workshops, indicating a successful product line [45][46] Question: How does promotional activity compare year over year? - Management stated that promotional activity has been managed more stringently, resulting in lower discount rates while focusing on enhancing customer experience [43][44] Question: How does the company leverage its presence in malls? - Management highlighted that having multiple locations in major malls enhances foot traffic and strengthens partnerships with mall operators [57][59]

Core Insights - Build-A-Bear Workshop, Inc. (BBW) is experiencing significant growth in its Commercial arm, which is diversifying revenues and profitability beyond traditional retail locations [2][5] - The company reported an 18.3% increase in Commercial revenues and a 15.2% rise in combined Commercial and International franchise revenues in Q2 of fiscal 2025 [2][9] - The partner-operated model is a key driver of this growth, allowing for high-margin wholesale revenues with minimal capital expenditure [3][4] Revenue Growth - Commercial revenues grew by 18.3% in Q2, while total partner and franchise revenues increased by 15.2% [9] - The Commercial segment has expanded at a 63% compound annual growth rate from fiscal 2020 to 2024 [2] Business Model - The partner-operated model requires low capital investment and leverages existing infrastructure, contributing to higher gross margins [3][4] - With 157 partner-operated stores now representing 25% of Build-A-Bear's 627 global locations, this model is scaling faster than corporate stores [3] Future Outlook - Management anticipates at least 60 net new locations in fiscal 2025, primarily through partners [5] - The success of the Commercial arm indicates a structural shift towards a hybrid consumer-products brand, potentially rivaling the retail business in margin contribution [5] Competitive Position - Build-A-Bear has outperformed competitors, with a 50.8% stock price increase over the past year compared to the industry's 7.3% growth [6] - The company's forward 12-month price-to-earnings ratio is 12.79, lower than the industry average of 17.84, indicating a potential valuation opportunity [7][10] Financial Estimates - The Zacks Consensus Estimate for current financial-year sales and earnings per share suggests year-over-year growth of 7.4% and 6.9%, respectively [11] - Current quarter sales are estimated at $124.28 million, with a year-over-year growth estimate of 4.06% [12]

Core Insights - Build-A-Bear Workshop is successfully targeting adults, leveraging nostalgia to diversify its portfolio and enhance customer engagement [3][12][14] - The company reported record-breaking revenue of $252.6 million in the first half of fiscal 2025, marking a nearly 12% increase year-over-year [3][4] - Build-A-Bear's stock has risen approximately 60% year-to-date, nearing a $1 billion market cap, despite challenges faced by other retailers [4][10] Financial Performance - The company raised its outlook following effective tariff mitigation strategies, including increased inventory management [4][8] - Build-A-Bear's diverse revenue streams, including new products and demographics, have contributed to its financial resilience [10][11] Market Position and Strategy - The company has expanded beyond traditional retail locations, establishing a presence in cruise ships, amusement parks, and hospitality [5][6] - Build-A-Bear's ability to discreetly raise prices through constant product innovation has helped mitigate tariff impacts [10][11] Consumer Engagement - A recent survey indicated that 92% of adults still own their childhood teddy bears, highlighting the brand's strong nostalgic appeal [14][16] - The experiential nature of Build-A-Bear's offerings fosters deep emotional connections with consumers, enhancing brand loyalty [16][17] Future Outlook - Analysts suggest that Build-A-Bear's international expansion presents significant growth opportunities, with high returns on capital [11] - The brand's focus on personalization and creating memorable experiences positions it well in a competitive retail landscape [9][18]

Financial Data and Key Metrics Changes - The company reported record revenue of over $128 million, an increase of 11.9% year-over-year [6][20] - Pretax income grew by 30.6% to nearly $20 million, with an EPS increase of 42.7% to $1.17 [6][20] - The pretax margin rate for Q1 was 15%, compared to 3% in Q1 2019, indicating significant improvement [6][8] Business Line Data and Key Metrics Changes - Net retail sales increased by 10.9% to $119.6 million, with strong performance across all segments [20] - E-commerce demand rose by 0.5%, while commercial revenue, primarily from wholesale sales, grew by 28.3% [22][20] - The Mini Beans collectibles line expanded by 30% year-over-year, with total sales reaching nearly 2 million units [16] Market Data and Key Metrics Changes - Domestic store traffic increased by 3%, significantly outperforming the U.S. national traffic, which declined by 3% [21][20] - The company ended the quarter with over 600 locations, with 30% of those outside the United States [9][10] Company Strategy and Development Direction - The company is focused on three strategic initiatives: expanding experiential retail footprint, advancing digital transformation, and leveraging brand strength through investments [9][14] - Plans include opening at least 50 net new locations in 2025, primarily operated by international partners [25][13] - The company aims to enhance inventory management systems to better respond to market trends and consumer demands [14][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating economic and geopolitical challenges, reiterating revenue guidance for 2025 [8][18] - The company expects to report record revenue for the year, maintaining strong profitability with double-digit pretax margins [18][26] - Management highlighted the importance of a clean balance sheet and strong cash flow in supporting long-term growth initiatives [9][18] Other Important Information - The company returned over $7 million in capital to shareholders through dividends and share repurchases [6][20] - Inventory at quarter-end was $72.3 million, reflecting an increase due to accelerated purchases of core products [25] Q&A Session Summary Question: How will the company capitalize on movie-related events? - Management noted strong relationships with major film creators and the ability to leverage popular characters like Stitch for broader appeal beyond children [34][35] Question: How will the new inventory management system improve responsiveness to trends? - The new system will enhance real-time inventory visibility and allow for better movement of stock between e-commerce and physical stores, improving responsiveness to demand spikes [38][39] Question: How did the retail stores perform compared to expectations? - Retail stores exceeded expectations with positive traffic, conversion rates, and average unit retail, indicating effective execution by the team [47][48] Question: Who are the partners for operated stores and are there plans for more? - Partners include well-known firms in various markets, and the company is in negotiations for new partnerships while maintaining high standards for partner operations [51][54] Question: What is the impact of tariffs on the updated guidance? - The updated pretax income guidance reflects less than $10 million in tariff impacts, with ongoing efforts to mitigate costs through diversified sourcing [62][63]