Financial Data and Key Metrics Changes - Net sales for Q2 2025 were $132.5 million, compared to $130.8 million in Q2 2024, reflecting a slight increase [7] - The company incurred a diluted loss of $1.05 per share, while adjusted diluted earnings per share were $0.41, down from $0.47 per share in the same period last year [7] - For the six months ended June 28, 2025, net sales totaled $268.2 million, with a diluted loss of $0.57 per share, compared to $267.6 million in sales and $0.87 per share in diluted earnings for the same period in 2024 [8] - Cash and short-term investments amounted to $101 million, with a current ratio of 4.0:1 and no debt [8] Business Line Data and Key Metrics Changes - New product sales accounted for $42 million, or 34% of net firearm sales, indicating an increase from Q1 2025 [14] - The company conducted a product rationalization that resulted in a $5.7 million reduction in sales due to SKU reductions, particularly affecting the American Gen one and EC9 pistols [18][19] Market Data and Key Metrics Changes - The firearms industry is experiencing softening demand, with NICS checks falling below pre-2019 levels, impacting manufacturing, distribution, and retail channels [15] - Despite market challenges, the company is reportedly outpacing the market in terms of demand, with a focus on maintaining market share [31] Company Strategy and Development Direction - The company has reorganized its operations to enhance flexibility and accountability, aiming for sustainable growth and resilience in a cyclical market [5] - The acquisition of Anderson Manufacturing for $16 million is expected to expand capacity and product offerings, reinforcing the company's position in the firearms market [12][13] - The company emphasizes innovation and market share gain as key strategies in a down market [31] Management's Comments on Operating Environment and Future Outlook - Management acknowledges macroeconomic pressures such as tariff and interest rate uncertainty, a weakening job market, and inflation affecting consumer spending [15] - The company remains committed to delivering reliable and innovative products while operating with financial discipline and maximizing shareholder value [16] Other Important Information - The company returned $23 million to shareholders through dividends and stock repurchases, maintaining a dividend strategy of approximately 40% of net income [10] - The organizational realignment is not primarily a cost-saving initiative but rather a reallocation of talent to better align with future strategies [27] Q&A Session Summary Question: Impact of product rationalization on sales - The product rationalization primarily affected the American Gen one and EC9 pistols, with a $5.7 million reduction in sales [18][19] Question: Organizational realignment and long-term savings - The organizational realignment is complete, focusing on reallocating talent rather than generating ongoing savings [27][28] Question: Current consumer demand for firearms - The company is outpacing the market in demand, with a focus on producing SKUs that customers want [31]