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Market ClerkRecap
Sat Oct 31 · markets closed3 signals on Oct 30129 insider buys this week · $10BCIRO short report next: Nov 14The week ahead

FOXF

FOX FACTORY HOLDING CORP
NASDAQ · CONSUMER DISCRETIONARY · MOTORCYCLES, BICYCLES & PARTS
15.99
−0.34 −2.08%
USD · close Oct 30
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Work order
91
PASS · shorts 91
Insiders, 90 days
0
no open-market filings in 90 days
Congress, 90 days
0 / 0
no disclosures naming it
Big money
0 / 15
none of the tracked funds disclose it
Calls on record
0
nobody we score has called it yet
MKT CAP $672.1MP/E —DIV YIELD —FCF YIELD 1.90%REV TTM $1.5B +1.6%NET INCOME −$298.6MNET DEBT $446.7M52W 13.19 – 22.89SEC XBRL · TTM TO Invalid Date

How FOXF rewrote its risk factors

10-K ITEM 1A · FY2025 → FY2026
Text kept
35%
of sentences unchanged
Added
447
new sentences
Dropped
392
sentences removed
Length
+2,753
words, now 34,647

New in FY2026

  • Our aftermarket distribution network currently consists of more than 9,600 retail dealers and distributors worldwide.
  • From time to time, we have experienced, and may continue to experience, inventory risks, including excess, obsolete, or slow-moving inventory, as well as warranty costs and claims relating to our products.
  • In the ordinary course of business, we reserve for these matters in our financial statements.
  • There is a risk, however, that in the future we will experience higher than expected inventory adjustments or write-downs, warranty costs and claims, as well as other related costs.
  • Please read “Risks Related to Our Business and Operations - If we inaccurately forecast demand for our products or inaccurately predict OEM and dealer destocking and restocking cycles and production schedules, we may manufacture insufficient or excess quantities or our manufacturing costs could increase, which could adversely affect our business ” and “ Product recalls, and significant product repair and/or replacement due to product warranty costs and claims have had, and in the future, could have, a material adverse impact on our business ” within Item 1A.
  • From time to time, we evaluate our portfolio of businesses and may pursue divestitures of non‑core or underperforming operations as part of our strategy to focus on higher‑growth, higher‑margin areas.
  • Divestitures may result in transitional costs, potential loss of revenue, and other financial impacts during and after the separation, including possible gains or losses on disposal depending on the structure and timing of the transaction.
  • These transactions can also create operational risks, including disruption to employees and customers and reliance on transition services arrangements for a period of time.
  • We continue to assess opportunities to streamline our portfolio and allocate capital and management attention to areas that best support our strategic objectives.
  • The current presidential administration expanded tariffs on steel, aluminum, and derivative products, imposed new tariffs on imports from China, Hong Kong, Mexico, and Canada, and proposed a shift toward reciprocal tariffs.
  • These services are typically recognized as revenue when the service is performed; • Tariff surcharges: consist of amounts billed to customers to recover tariff costs and are recorded as revenue when the associated products are recognized as revenue; and • Shipping and handling fees: consists of shipping and handling fees billed to customers.
  • Cost of sales Cost of sales includes the cost of purchased parts and manufactured products (raw materials consumed, the cost to procure materials, labor costs, including wages, and employee benefits, and factory overhead to produce finished goods or products), including: • the costs to inspect and repair products; • shipping costs associated with inbound freight (such costs are capitalized as part of inventory and included in cost of sales as the inventory is sold); • royalty expenses, including payments to certain parties for our use of licensed technology incorporated into our products; • freight expenses incurred for certain shipments to customers; • tariffs; • warranty costs associated with the repair or replacement of products under warranty; and • reductions in the carrying value of inventory to its net realizable value, if required, for estimated excess, obsolescence or impaired balances.
  • Operating expenses Our operating expenses consist of the following: • goodwill impairment; • sales and marketing; • research and development; • general and administrative; • amortization of purchased intangibles; and • intangible and long-lived asset impairment.
  • Our goodwill impairment expense reflects non-cash charges recognized when the carrying value of goodwill exceeds its estimated fair value.
  • We perform a goodwill impairment assessment at least annually but may perform interim assessments in the event of a triggering event that may indicate the fair value of a reporting unit decreased below its carrying value.
  • During the year ended January 2, 2026, we recorded $557.3 million goodwill impairment charges as a result of our assessments.
  • No goodwill impairments were identified in the years ended January 3, 2025 and December 29, 2023.
  • Other significant sales and marketing expenses include commissions paid to outside sales representatives, promotional materials and products, our sales office costs, third-party marketing spend, race support and sponsorships of events and athletes, advertising and promotions related to trade shows, and travel and entertainment.
  • We expense research and development costs as incurred and such costs are included as research and development expenses on our consolidated statements of operations.
  • In the year ended January 2, 2026, we recognized $8.0 million impairments of intangible assets.
  • No impairments of intangible assets were identified in the years ended January 3, 2025 and December 29, 2023.
  • Our intangible and long-lived asset impairment expense includes non-cash charges recognized when the carrying value of intangible and other long-lived assets is not recoverable.
  • When indicators of impairment are present, we assess the asset’s recoverability and, if necessary, write it down to its estimated fair value.
  • In the year ended January 2, 2026, we recorded total intangible and long-lived asset impairments of $13.5 million, inclusive of the $8.0 million intangible asset impairments described above.
  • No impairments of long-lived assets were identified in the years ended January 3, 2025 and December 29, 2023.
  • For the years ended January 2, 2026, January 3, 2025 and December 29, 2023, we had effective tax rates of 5.5%, (543.5)% and 12.8%, respectively.
  • As of January 2, 2026, our deferred tax assets included foreign tax credits of approximately $45.4 million, which begin to expire in 2028 unless utilized.
  • The Company is implementing tax planning strategies and operational measures to support the realizability of its general category foreign tax credits and to mitigate valuation allowance risk.
  • As of January 2, 2026, the Company determined a valuation allowance was needed for branch foreign tax credits.
  • NCI are presented as separate components in our consolidated statements of operations to clearly differentiate between our interests and the economic interests of third parties in those entities.
  • Net (loss) income attributable to FOX stockholders, as reported in the consolidated statements of operations, is presented net of the portion of net income (loss) attributable to non-controlling interests.
  • Results of operations The table below summarizes our results of operations for the fiscal years ended January 2, 2026, January 3, 2025, and December 29, 2023: For the fiscal years ended (in millions) January 2, 2026 January 3, 2025 December 29, 2023 Net sales $ 1,467.3 $ 1,393.9 $ 1,464.2 Cost of sales 1,024.1 970.3 999.4 Gross profit 443.2 423.6 464.8 Operating expenses: Goodwill impairment 557.3 — — General and administrative 151.8 139.9 124.6 Sales and marketing 132.1 121.2 100.5 Research and development 69.4 60.3 53.2 Amortization of purchased intangibles 42.0 44.5 26.5 Intangible and long-lived asset impairment 13.5 — — Total operating expenses 966.2 365.9 304.7 (Loss) income from operations (522.9) 57.7 160.1 Interest expense 53.7 54.9 19.3 Other (income) expense, net (0.3) 1.7 2.1 (Loss) income before income taxes (576.3) 1.0 138.7 (Benefit) provision for income taxes (31.6) (5.5) 17.8 Net (loss) income (544.7) 6.5 120.8 Less: net loss attributable to non-controlling interest (0.1) — — Net (loss) income attributable to FOX stockholders $ (544.6) $ 6.6 $ 120.8 *Amounts may not foot due to rounding.
  • The following table sets forth statement of operations data as a percentage of net sales for the years indicated: For the fiscal years ended January 2, 2026 January 3, 2025 December 29, 2023 Net sales 100.0 % 100.0 % 100.0 % Cost of sales 69.8 69.6 68.3 Gross profit 30.2 30.4 31.7 Operating expenses: Goodwill impairment 38.0 — — General and administrative 10.3 10.0 8.5 Sales and marketing 9.0 8.7 6.9 Research and development 4.7 4.3 3.6 Amortization of purchased intangibles 2.9 3.2 1.8 Intangible and long-lived asset impairment 0.9 — — Total operating expenses 65.8 26.3 20.8 (Loss) income from operations (35.6) 4.1 10.9 Interest expense 3.7 3.9 1.3 Other (income) expense, net — 0.1 0.1 (Loss) income before income taxes (39.3) 0.1 9.5 (Benefit) provision for income taxes (2.2) (0.4) 1.2 Net (loss) income (37.1) 0.5 8.3 Less: net loss attributable to non-controlling interest — — — Net (loss) income attributable to FOX stockholders (37.1) % 0.5 % 8.3 % *Percentages may not foot due to rounding.
  • Fiscal year ended January 2, 2026 compared to fiscal year ended January 3, 2025 Net sales For the fiscal years ended (in millions) January 2, 2026 January 3, 2025 Change ($) Change (%) Net sales $ 1,467.3 $ 1,393.9 $ 73.4 5.3 % Net sales for the year ended January 2, 2026 increased approximately $73.4 million, or 5.3%, compared to the year ended January 3, 2025.
  • The increase in net sales is primarily due to increased demand for aftermarket applications, improved performance in our upfitting product lines, and the market share gain in powersports, which offset lower industry demand in the automotive OE product lines.
  • Although net sales increased, high interest rates impacting industry and consumer demands, high vehicle costs, and macro-economic conditions remain headwinds.
  • Cost of sales For the fiscal years ended (in millions) January 2, 2026 January 3, 2025 Change ($) Change (%) Cost of sales $ 1,024.1 $ 970.3 $ 53.8 5.5 % Cost of sales for the year ended January 2, 2026 increased approximately $53.8 million, or 5.5%, compared to the year ended January 3, 2025.
  • The increase in cost of sales was mainly due to our increased sales and the impact of tariffs.
  • For the year ended January 2, 2026, our gross margin was 30.2% compared to 30.4% for the year ended January 3, 2025.
  • The decrease in gross margin for the fiscal year 2025 was primarily due to the shifts in our product line mix and the impact of tariffs.

and 407 more.

Gone since FY2025

  • Our aftermarket distribution network currently consists of more than 16,000 retail dealers and distributors worldwide.
  • In addition, we believe international expansion represents a significant opportunity for us and we intend to selectively increase infrastructure investments and focus on identified geographic regions.
  • In the fourth quarter of 2021, we completed the construction of an approximately 336,000 square foot state-of-the-art facility in Hall County, Georgia (the “Gainesville Facility”), to diversify our manufacturing platform and provide additional long-term capacity to support growth in our Powered Vehicles Group.
  • The Gainesville Facility is being used for manufacturing, warehousing, distribution and office space.
  • From time to time, we have experienced, and may continue to experience, warranty costs and claims relating to our products.
  • In the ordinary course of business, we reserve for such costs and claims in our financial statements.
  • There is a risk, however, that in the future we will experience higher than expected warranty costs and claims, as well as other related costs.
  • Please read “Risks Related to Our Business and Operations - Product recalls, and significant product repair and/or replacement due to product warranty costs and claims have had, and in the future, could have, a material adverse impact on our business” within Item 1A.
  • The new presidential administration has expanded tariffs on steel, aluminum, and derivative products, imposed new tariffs on imports from China, Hong Kong, Mexico, and Canada, and proposed a shift toward reciprocal tariffs.
  • These services are typically recognized as revenue when the service is performed; and • Shipping and handling fees: consists of shipping and handling fees billed to customers.
  • Cost of sales The cost of sales includes the cost of purchased parts and manufactured products (raw materials consumed, the cost to procure materials, labor costs, including wages, and employee benefits, and factory overhead to produce finished goods or products), including: • the costs to inspect and repair products; • shipping costs associated with inbound freight (such costs are capitalized as part of inventory and included in cost of sales as the inventory is sold); • royalty expenses, including payments to certain parties for our use of licensed technology incorporated into our products; • freight expenses incurred for certain shipments to customers; • warranty costs associated with the repair or replacement of products under warranty; and • reductions in the cost of inventory to its net realizable value, if required, for estimated excess, obsolescence or impaired balances.
  • Operating expenses Our operating expenses consist of the following: • sales and marketing; • research and development; • general and administrative; and • amortization of purchased intangibles.
  • We expense research and development costs as incurred and such costs are included as research and development expenses on our consolidated statements of income.
  • No impairments of intangible assets were identified in the years ended January 3, 2025, December 29, 2023 and December 30, 2022.
  • For the years ended January 3, 2025, December 29, 2023 and December 30, 2022, we had effective tax rates of (543.5)%, 12.8% and 12.2%, respectively.
  • As of January 3, 2025, our deferred tax assets included foreign tax credits of approximately $47.4 million, which begin to expire in 2027 unless utilized.
  • As of January 3, 2025, the Company determined a valuation allowance was not needed.
  • NCI are presented as separate components in our consolidated statements of income to clearly differentiate between our interests and the economic interests of third parties in those entities.
  • Net income attributable to FOX stockholders, as reported in the consolidated statements of income, is presented net of the portion of net income (loss) attributable to non-controlling interests.
  • Results of operations The table below summarizes our results of operations for the fiscal years ended January 3, 2025, December 29, 2023, and December 30, 2022: For the fiscal years ended (in millions) January 3, 2025 December 29, 2023 December 30, 2022 Net sales $ 1,393.9 $ 1,464.2 $ 1,602.5 Cost of sales 970.3 999.4 1,071.1 Gross profit 423.6 464.8 531.3 Operating expenses: General and administrative 139.9 124.6 116.1 Sales and marketing 121.2 100.5 90.8 Research and development 60.3 53.2 56.2 Amortization of purchased intangibles 44.5 26.5 21.5 Total operating expenses 365.9 304.7 284.6 Income from operations 57.7 160.1 246.7 Interest expense 54.9 19.3 8.9 Other expense, net 1.7 2.1 4.0 Income before income taxes 1.0 138.7 233.8 (Benefit) provision for income taxes (5.5) 17.8 28.5 Net income 6.5 120.8 205.3 Less: net loss attributable to non-controlling interest — — — Net income attributable to FOX stockholders $ 6.6 $ 120.8 $ 205.3 *Amounts may not foot due to rounding.
  • The following table sets forth statement of income data as a percentage of net sales for the years indicated: For the fiscal years ended January 3, 2025 December 29, 2023 December 30, 2022 Net sales 100.0 % 100.0 % 100.0 % Cost of sales 69.6 68.3 66.8 Gross profit 30.4 31.7 33.2 Operating expenses: General and administrative 10.0 8.5 7.2 Sales and marketing 8.7 6.9 5.7 Research and development 4.3 3.6 3.5 Amortization of purchased intangibles 3.2 1.8 1.3 Total operating expenses 26.3 20.8 17.8 Income from operations 4.1 10.9 15.4 Interest expense 3.9 1.3 0.6 Other expense, net 0.1 0.1 0.2 Income before income taxes 0.1 9.5 14.6 (Benefit) provision for income taxes (0.4) 1.2 1.8 Net income 0.5 8.3 12.8 Less: net loss attributable to non-controlling interest — — — Net income attributable to FOX stockholders 0.5 % 8.3 % 12.8 % *Percentages may not foot due to rounding.
  • Fiscal year ended January 3, 2025 compared to fiscal year ended December 29, 2023 Consolidated net sales For the fiscal years (in millions) 2024 2023 Change ($) Change (%) Total net sales $ 1,393.9 $ 1,464.2 $ (70.3) (4.8) % Total net sales for the year ended January 3, 2025 decreased approximately $70.3 million, or 4.8%, compared to the year ended December 29, 2023.
  • The decrease in net sales is primarily due to product mix, chassis availability, lower industry and end consumer demand because of higher interest rates and higher inventory levels at OEMs and dealerships.
  • The decrease was partially offset by a full-year net sales of $192.4 from Marucci, which was acquired in November 2023, compared to net sales of $16.8 million included in prior year.
  • Cost of sales For the fiscal years (in millions) 2024 2023 Change ($) Change (%) Cost of sales $ 970.3 $ 999.4 $ (29.1) (2.9) % Cost of sales for the year ended January 3, 2025 decreased approximately $29.1 million, or 2.9%, compared to the year ended December 29, 2023.
  • The decrease in cost of sales was mainly due to our decreased sales.
  • For the year ended January 3, 2025, our gross margin was 30.4% compared to 31.7% for the year ended December 29, 2023.
  • The decrease in gross margin for the fiscal year 2024 was primarily due to shifts in our product line mix and operating leverage on lower volume.
  • Operating expenses For the fiscal years (in millions) 2024 2023 Change ($) Change (%) Operating expenses: General and administrative $ 139.9 $ 124.6 $ 15.3 12.3 % Sales and marketing 121.2 100.4 20.8 20.7 Research and development 60.3 53.2 7.1 13.3 Amortization of purchased intangibles 44.5 26.5 18.0 67.9 Total operating expenses $ 365.9 $ 304.7 $ 61.2 20.1 % Total operating expenses for the year ended January 3, 2025 increased approximately $61.2 million, or 20.1%, over the comparable period in 2023.
  • When expressed as a percentage of net sales, operating expenses increased to 26.3% of net sales for the year ended January 3, 2025, compared to 20.8% of net sales for the fiscal year ended December 29, 2023.
  • Within operating expenses, our sales and marketing expenses and general and administrative expenses increased by approximately $20.8 million and $15.3 million, respectively, primarily due to $24.6 million and $26.9 million higher expenses attributable to Marucci, respectively, attributed to including a full year of Marucci expenses in 2024.
  • The increase was partially offset by our cost containment measures.
  • Research and development expenses increased approximately $7.1 million driven by personnel investments to support future growth and product innovation and the inclusion of a full year of Marucci expenses.
  • Amortization of purchased intangible assets for the year ended January 3, 2025 increased by approximately $18.0 million as compared to the year ended December 29, 2023, primarily due to the amortization of Marucci intangible assets.
  • Income from operations For the fiscal years (in millions) 2024 2023 Change ($) Change (%) Income from operations $ 57.7 $ 160.1 $ (102.4) (64.0) % As a result of the factors discussed above, income from operations for the year ended January 3, 2025 decreased approximately $102.4 million, or 64.0%, compared to the year ended December 29, 2023.
  • Interest and other expense, net For the fiscal years (in millions) 2024 2023 Change ($) Change (%) Interest expense $ 54.9 $ 19.3 $ 35.6 184.5 % Other expense, net 1.7 2.1 (0.4) (19.0) Interest and other expense, net $ 56.6 $ 21.4 $ 35.2 164.5 % Interest and other expense, net for the year ended January 3, 2025 increased by approximately $35.2 million to $56.6 million, compared to $21.4 million for the year ended December 29, 2023.
  • Interest expense increased by $35.6 million due to higher debt and interest rates.
  • Income taxes For the fiscal years (in millions) 2024 2023 Change ($) Change (%) (Benefit) provision for income taxes $ (5.5) $ 17.8 $ (23.3) (130.9) % Income tax expense for the year ended January 3, 2025 decreased by approximately $23.3 million to a benefit of $5.5 million compared to $17.8 million for the year ended December 29, 2023.
  • The decrease primarily resulted from a decrease in pre-tax profit.
  • The effective tax rates were (543.5)% and 12.8% for the years ended January 3, 2025 and December 29, 2023, respectively.

and 352 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2025 ↗, FY2026 ↗). 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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