Fox Factory (FOXF) investor relations material

Executive summary

• Q1 2026 net sales rose 3.9% year-over-year to $368.7 million, reaching the high end of guidance, driven by powersports, automotive aftermarket, and upfitting demand.

• Adjusted EBITDA was $35.7 million, exceeding guidance, while adjusted net income was $7.4 million ($0.18 per diluted share), down from $9.8 million ($0.23 per share) last year.

• Net loss narrowed significantly to $15.0 million, or $0.36 per diluted share, from $259.7 million last year, reflecting the absence of a prior-year goodwill impairment charge and improved operations.

• Early results from the multi-phase profit optimization strategy are materializing, with phase one savings realized and phase two on schedule, targeting $50 million in cost savings for fiscal 2026.

• The Phoenix, Arizona operations divestiture closed as planned, with proceeds dedicated to debt reduction.

Financial highlights

• Gross margin declined to 28.9% from 30.9% year-over-year, mainly due to tariffs and product mix shifts.

• Adjusted EBITDA margin was 9.7%, down from 11.2% in the prior year, but stable sequentially.

• Cash and cash equivalents stood at $53.9 million at quarter-end; total debt was $688.2 million.

• Operating cash flow was $(16.1) million, compared to $0.7 million in the prior year.

• Operating expenses dropped significantly due to the absence of prior year goodwill impairment.

Outlook and guidance

• Full-year 2026 net sales expected between $1.328–$1.416 billion; adjusted EBITDA between $174–$203 million, reaffirmed.

• Q2 2026 net sales expected between $343–$365 million; adjusted EBITDA between $32–$40 million.

• Guidance implies approximately 200-basis points of adjusted EBITDA margin improvement over 2025.

• Margin expansion is expected in H2 as cost savings and tariff anniversaries take effect.

• No potential tariff recoveries included in outlook due to uncertainty.