FOX FACTORY HOLDING CORP Q1 FY2026 earnings call

• Mike Dennison mentioned first quarter revenue of $368.7 million, the high end of guidance, and adjusted EBITDA of $35.7 million exceeding the high end of guidance. • Phase 1 cost carryover and Phase 2 actions were on schedule, and the Phoenix divestiture was closed as planned. • Focus on controlling costs with $50 million savings target in 2026, $10 million from Phase 1 carryover and $40 million from Phase 2 actions. • PDG's segment performance details including automotive and power sports. • AAG's growth, PVD's OEM partnerships and dealership expansion efforts. • SSG's bike business progress and challenges. • Marucci's VAT softness and softball growth highlights.

PDG delivered net sales of $143.4 million in Q1, up 17.4% year-over-year. This was a strong start for the segment with growth reflecting timing dynamics though underlying performance aligned with the year's framework. Automotive premium truck OE had balanced performance due to shipment timing and macro pressures, while power sports had a solid quarter but cautious near-term outlook. AAG had net sales of $114.8 million, up 2.6% year-over-year. Growth came from upfitting product lines and aftermarket demand, offset by the Phoenix operations exit. PVD's portfolio was evolving with OEM relationships and dealership expansion, including new strategic partnerships with automotive OEMs. SSG had net sales of $110.5 million, down 8.7% year-over-year. The bike business had improved channel inventory but muted demand. Marucci saw VAT industry volumes trend softly but softball was a bright spot with new products resonating and significant growth since 2024.

• Reaffirmed 2026 full-year outlook with net sales expected in the range of $1.328 billion to $1.416 billion and adjusted EBITDA in the range of $174 million to $203 million. • Q2 net sales expected to be in the range of $343 million to $365 million and adjusted EBITDA in the range of $32 million to $40 million. • Tariff dynamics shifted with Section 232 framework having a smaller impact on businesses, Marucci's tariff benefit absorbed by soft demand, and margin expansion expected in the second half with Phase II benefits and tariff anniversary. • Capital expenditures expected to be approximately 2% of revenues and tax rate in the range of 15 to 18%.

• Forward-looking statements involve known and unknown risks, including factors outside the company's control that could materially affect future results. • Important factors and risks detailed in quarterly reports on Form 10-Q and annual report on Form 10-K. • Uncertainty regarding tariff cost recoveries, volatility in the bike industry, and disruptions in suppliers and customers affecting business performance. • Impact of macro environment, tariffs, and supply chain issues on the company's results.

Q: Commentary on fuel prices and consumer behavior, A: Mike Dennison said the premium automotive buyers in their business aren't as focused on gas prices, but in the aftermarket, consumers are more conservative due to high interest rates and gas prices, leading them to invest in their current trucks.

Q: PowerSports and OEM tariff exposure, A: Mike Dennison said they are diversified across major OEMs in the PowerSports category and seeing a shift in mix as they pivot from one OEM to another.

Q: Implied margin improvement, A: Dennis Shem said the strong first quarter, improvements in AAG and Marucci, and the ongoing cost plan contribute to the expected margin improvement.

Q: Marucci's outlook and strategic alternatives, A: Dennis Shem said Marucci was down in the first quarter due to channel inventory, but they are running the business hard and excited about Q3 product launches.

Q: Bike business OE orders and new customers, A: Mike Dennison said the bike business is stable with product diversification and expansion into new customers, benefiting from disruption in the industry and relationships with new players.

Q: PVD upfitting partnership model and tariffs, A: Dennis Shem said the PVD upfitting partnership model is a new channel with new partnership structure, relieving SG&A and opening new dealer relationships; on tariffs, the Section 232 framework is less impactful for core businesses and Marucci's tariff benefit is absorbed by soft demand.