COOK

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How COOK rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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New in FY2025

Risks Related to Our Business and Industry We may not realize the anticipated benefits of our multi-step strategic optimization plan, Project Gravity, and the related reduction in force and operational centralization may adversely affect our business, results of operations, and culture.
On May 15, 2025, our Board approved a comprehensive enterprise initiative, “Project Gravity,” designed to streamline our organizational structure, rebalance our cost base, and improve profitability and cash flow.
Actions include a reduction in force, centralization of our MEATER business into our Salt Lake City infrastructure, streamlining and channel optimization initiatives (including discontinuing the Costco roadshow program and exiting our Traeger direct-to-consumer business by redirecting Traeger.com consumers to retail partners), transitioning to a distributor model in certain European markets that currently operate under a direct model, and pellet mill consolidation.
We recorded $24.9 million of total restructuring and other costs in fiscal year 2025 related to these initiatives, and we currently expect Project Gravity, in its entirety, to be substantially completed by the end of fiscal year 2026.
Implementing these changes may disrupt our operations, divert management attention, and result in the loss of institutional knowledge and key personnel, which could harm product development, customer support, supply chain execution, and our ability to meet retailer requirements.
Further, workforce reductions and site consolidations can negatively affect employee morale, productivity, and our culture, which we view as critical to innovation and brand engagement.
Any such impacts could impair our ability to maintain product quality, deliver on time and in full, and preserve customer and retailer relationships.
We may incur additional or unanticipated restructuring charges, and the cost savings we expect may not be realized, may be delayed, or may be offset by reduced revenue, higher input costs, or other expenses.
For example, transitioning to a distributor model in Europe, discontinuing certain channel programs, consolidating pellet production, and centralizing operations may create near-term operational complexity, require contractual renegotiations, or lead to one-time costs.
If we do not execute these initiatives effectively, our results of operations and cash flows could be adversely affected.
In addition, reductions in force and business model transitions could expose us to legal and compliance risks, including with respect to labor and employment, health and safety, data protection, and ethical sourcing expectations across our supply chain, any of which could result in litigation, regulatory inquiries, or reputational harm.
We have incurred operating losses in the past, may incur operating losses in the future, and may not achieve or maintain profitability in the future.
For the year ended December 31, 2025, we had a net loss of $115.2 million.
As of December 31, 2025, we had an accumulated deficit of $804.1 million.
We expect our operating expenses to fluctuate as a percentage of revenue as we continue to manage our investments in innovation and enhance our product offerings.
While we intend to leverage these expenses over time to achieve profitability and expand revenue opportunities, these efforts and additional expenses may be more costly than we expect, and we cannot guarantee that we will be able to increase our revenue to offset our operating expenses.
Our revenue may continue to decline for a number of other reasons, including reduced demand for our products, increased competition, a decrease in the growth or reduction in size of our overall market, a challenging macroeconomic environment, or if we cannot capitalize on growth opportunities.
For example, during the year ended December 31, 2025, our total revenue decreased by 7.4% compared to the year ended December 31, 2024.
Our historical growth rates may not be sustainable or indicative of future growth.
Our historical, long-term rate of growth may not be sustainable or indicative of our future rate of growth, including in the near term.
We have experienced increased demand for our products in the past, for example due to the impact that the COVID-19 pandemic had on consumer behavior as a result of various stay-at-home orders and restrictions on dining options and restaurant closures.
We may be unable to effectively manage our business through periods of strategic realignment, which could make it more difficult to execute our business strategy.
We may be unable to effectively manage our business through periods of strategic realignment, which could make it difficult to execute our business strategy.
We have only a limited history operating at our current scale and, in response to evolving market conditions, have undertaken restructuring actions, including workforce reductions and, in 2025, Project Gravity, which includes a reduction in force and centralization and streamlining of operations.
Managing our business through these changes places significant demands on management and our operational, financial, and IT infrastructure.
If we do not effectively integrate organizational changes, retain critical talent, and maintain high-quality customer support and product quality, our reputation, brand, and results of operations could be harmed.
Our cost-savings initiatives and channel realignments may not produce the expected benefits and could introduce operational complexities.
For example, centralizing MEATER operations, exiting our direct-to-consumer business (other than for MEATER), discontinuing certain channel programs, transitioning to distributors in certain European markets, and pellet mill consolidation may cause disruptions, require additional oversight of third parties, or lead to inventory and forecasting challenges, which could adversely affect revenue, gross margins, and retailer relationships.
For example, the U.S. has announced and implemented additional tariffs on certain imports from China under multiple authorities.
On February 20, 2026, the Supreme Court ruled that the President cannot use the International Emergency Economic Powers Act (IEEPA) to impose tariffs, invalidating certain tariffs that had been imposed under IEEPA.
In response to this ruling, within hours of the decision, the President signed a proclamation imposing a new 10% global tariff under Section 122 of the Trade Act of 1974, effective February 24, 2026, and subsequently increased these tariffs to 15% on February 21, 2026.
Section 122 tariffs are subject to a 150-day statutory limit unless extended by Congress.
Trade Representative has announced it will initiate new Section 301 investigations into trading partners' unfair practices, which could result in additional tariffs.
Section 301 tariffs on Chinese goods also remain in effect.
The U.S. also continues to maintain tariffs on steel and aluminum, as well as increased tariffs and import restrictions on products imported from various other countries.
These tariffs on aluminum and steel include derivative tariffs that have impacted and will continue to impact a broad range of downstream products, which have and may continue to adversely impact our business.
The Supreme Court's ruling did not address whether importers who paid IEEPA tariffs are entitled to refunds, and that issue remains subject to further litigation before the U.S.
We cannot predict whether or when any refunds will be available, and the administration has indicated it intends to contest refund claims.
There is substantial uncertainty about the future relationship between the United States and other countries with respect to trade policies, taxes, government regulations, and tariffs.
This uncertainty has been heightened by the February 2026 Supreme Court ruling invalidating IEEPA tariffs, which has resulted in changes to the tariff structure and alternative tariff mechanisms being implemented.

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Gone since FY2024

Risks Related to Our Business and Industry We have incurred operating losses in the past, may incur operating losses in the future, and may not achieve or maintain profitability in the future.
For the year ended December 31, 2024, we had a net loss of $34.0 million.
As of December 31, 2024, we had an accumulated deficit of $688.9 million.
We expect our operating expenses to increase in the long term as we continue our sales and marketing efforts, expand our operating and retail infrastructure, add content and software features to our platform, expand into new geographies, develop new products, and incur legal, accounting, and other expenses related to operating as a public company.
These efforts and additional expenses may be more costly than we expect, and we cannot guarantee that we will be able to increase our revenue to offset our operating expenses.
Our revenue growth may slow or our revenue may decline for a number of other reasons, including reduced demand for our products, increased competition, a decrease in the growth or reduction in size of our overall market, a challenging macroeconomic environment, or if we cannot capitalize on growth opportunities.
For example, during the year ended December 31, 2024, our total revenue decreased by 0.3% compared to the year ended December 31, 2023.
Our historical growth rates may not be sustainable or indicative of future growth and we expect our growth rate to slow.
We have experienced significant growth since our change of ownership in 2013.
Our historical rate of growth may not be sustainable or indicative of our future rate of growth.
We have also experienced increased demand for our products in the past, for example due to the impact that the COVID-19 pandemic had on consumer behavior as a result of various stay-at-home orders and restrictions on dining options and restaurant closures.
We may be unable to manage our future growth effectively, which could make it difficult to execute our business strategy.
We have only a limited history of operating our business at its current scale.
We have made and expect to continue to make significant investments in our research and development efforts and in our sales and marketing organizations, including with respect to future product offerings, consumables, accessories, and services, and to expand our operations and infrastructure both domestically and internationally.
This growth has placed, and may continue to place, significant demands on our management and our operational and financial performance and infrastructure.
In 2022, we announced a planned reduction in workforce, as part of a plan to reduce our costs and drive long-term operational efficiencies.
At the same time, we suspended operations of Traeger Provisions and postponed nearshoring efforts to manufacture product in Mexico.
Over the long-term, we may not successfully execute or achieve what were the expected benefits of this reduction in force or incur greater costs than expected.
Further, any cost savings that we realize may be offset, in whole or in part, by a reduction in revenues or through increases in other expenses.
Additionally, our customers increasingly rely on our support services to resolve any issues related to the use of our products and smart features.
The importance of high-quality support will increase as we expand our business and introduce new and/or enhanced products and offerings, especially if we face limited brand recognition in certain markets that leads to non-acceptance or delayed acceptance of our products and services by consumers.
Our ability to manage our growth effectively and to integrate new employees, technologies, and acquisitions into our existing business will require us to continue to expand our operational and financial infrastructure and to continue to retain, attract, train, motivate, and manage employees.
Continued growth could strain our ability to develop and improve our operational, financial, and management controls, enhance our reporting systems and procedures, recruit, train, and retain highly skilled personnel, and maintain customer satisfaction.
Additionally, if we do not effectively manage the growth of our business and operations, the quality of our products and content could suffer, which could negatively affect our reputation and brand, business, financial condition, and results of operations, and our corporate culture may be harmed.
For example, effective March 4, 2025, the U.S. implemented a 25% additional tariff on imports from Canada and Mexico and a 20% additional tariff on imports from China.
On March 6, 2025, the Trump Administration announced that Mexican goods covered by the U.S.-Mexico-Canada Agreement would not be subject to the additional 25% tariff until April 2, 2025.
The U.S. also reinstated the 25% steel import tariff and reinstated and increased the aluminum import tariff to 25%, as well as increased tariffs and import restrictions on products imported from various other countries.
The steel and aluminum import tariffs will go into effect on March 12, 2025.
These new tariffs on aluminum and steel include derivative tariffs that will impact a broad range of downstream products and, if they remain in place in their current form, such tariffs could therefore adversely impact our business.
There is current uncertainty about the future relationship between the United States and other countries with respect to trade policies, taxes, government regulations, and tariffs and we cannot predict whether, and to what extent, U.S. trade policies will change in the future, including as a result of changes by the new U.S. presidential administration.
For example, in 2017, we introduced products that incorporate smart features, including our WiFIRE technology, a cloud-based Wi-Fi controller, that connects our grills to our Traeger app, enabling users to automate recipe steps and control and monitor their grill remotely.
In 2019, we also introduced D2 Direct Drive, an integrated, software-driven system that maintains grill temperature through variable speed fans and DC auger control.
In 2022, we introduced Smart Combustion technology which helps our grills maintain consistent cooking temperatures and a 2-in-1 EZ Clean grease and ash collection system.
For example, in August 2024, we received an offer of compromise to reach an out-of-court settlement for a product liability matter and as of December 31, 2024 , we accrued $15.0 million that will be covered by our insurance policies.
Consequently, the impact on operating results was $0.3 million and $2.6 million for years ended December 31, 2024 and 2023, respectively.
For example, in the year ended December 31, 2024, our three largest retailers accounted for 24%, 18%, and 8% of our revenue, respectively, with no other customer accounting for greater than 10% of our revenue for the year.
We have in the past recognized impairment charges for goodwill and we may need to recognize further impairments in the future, which could materially adversely impact our financial condition and results of operations.
As of December 31, 2021, the net carrying value of goodwill totaled $297.0 million prior to concluding that a triggering event had occurred during fiscal year 2022, which required interim goodwill impairment assessments.
We periodically assess the value of these assets for impairment in accordance with U.S. generally accepted accounting principles (“GAAP”).
Significant negative industry or economic trends, disruptions to our businesses, significant unexpected or planned changes in use of the assets, divestitures, and market capitalization declines may result in impairments to goodwill and other long-lived assets.

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Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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