Vital Farms, Inc.

Previous wording

We source our eggs from a network of more than 625 small farms, including our contracted family farms along with a small number of company-owned accelerator farms. We have strategically designed our supply chain to ensure high production standards and optimal year-round operation. We are motivated by the positive impact we have on rural communities and enjoy a strong relationship and reputation with the family farmers in our network.

Current wording

We source our eggs from a network of more than 600 small farms, including our contracted family farms along with a small number of company-owned accelerator farms. We have strategically designed our supply chain to ensure high production standards and optimal year-round operation. We are motivated by the positive impact we have on rural communities and enjoy a strong relationship and reputation with the family farmers in our network.

Previous wording

We primarily work with our contracted farms pursuant to buy-sell contracts. Under these arrangements, the farmer is responsible for all of the working capital and investments required to produce the eggs and manage the farm, including purchasing the birds and feed supply. As a result of elevated construction costs associated with our new farms, we incurred incremental farm recruitment costs in 2024 and 2025, which have continued into 2026, that were required to be paid in advance of these farms beginning to produce eggs. These costs are expected to be recognized over the term of the related buy-sell contracts with the new farms, which average approximately six years in length. We believe the impact to our working capital resulting from these upfront costs could range from $10.0 million to $15.0 million in fiscal 2026. We are contractually obligated to purchase all of the eggs produced by the farmer during the term of the contract at an agreed-upon price that depends upon pallet weight and is adjusted quarterly for changes in feed cost.

Current wording

We primarily work with our contracted family farms pursuant to buy-sell contracts. Under these arrangements, the farmer is responsible for all of the working capital and investments required to produce the eggs and manage the farm, including purchasing the birds and feed supply. At times, we incur incremental farm recruitment costs as a result of construction costs associated with onboarding our contracted new farms that are required to be paid in advance of these farms beginning to produce eggs. These costs are expected to be recognized over the term of the related buy-sell contracts with the new farms, which average approximately six years in length. We believe the impact to our working capital resulting from these upfront costs could range from $25.0 million to $30.0 million in fiscal 2026. We are contractually obligated to purchase all of the eggs produced by the farmer during the term of the contract at an agreed-upon price that depends upon pallet weight and is adjusted quarterly for changes in feed cost.

Previous wording

We believe we are a strategic and valuable partner to retailers. We have continued to command premium prices for our products, including our shell eggs. Our loyal and growing consumer base has fueled the continued expansion of our brand in the natural and mainstream retail channels. We believe the success of our brand demonstrates that consumers are demanding premium products that meet a higher ethical standard. We have a strong presence at The Kroger Co., or Kroger, Sprouts Farmers Market, Target Corporation and Whole Foods Market, Inc., or Whole Foods, and we also sell our products at Albertsons Companies, Inc., Publix Super Markets, Inc., Walmart, Inc. and other retailers. We offer 26 retail stock keeping units, or SKUs, through a multi-channel retail distribution network. We believe we have significant room for growth within the retail and foodservice channels through growing brand awareness, gaining additional points of distribution and new product innovation.

Current wording

We believe we are a strategic and valuable partner to retailers. We have continued to command premium prices for our products, including our shell eggs. Our loyal and growing consumer base has fueled the continued expansion of our brand in the natural and mainstream retail channels. We believe the success of our brand demonstrates that consumers are demanding premium products that meet a higher ethical standard. We have a strong presence at The Kroger Co., or Kroger, Sprouts Farmers Market, Target Corporation and Whole Foods Market, Inc., or Whole Foods, and we also sell our products at Albertsons Companies, Inc., Publix Super Markets, Inc., Walmart, Inc. and other retailers. We offer 29 retail stock keeping units, or SKUs, through a multi-channel retail distribution network. We believe we have significant room for growth within the retail and foodservice channels through growing brand awareness, gaining additional points of distribution and new product innovation.

Previous wording

We had net revenue of $166.0 million and $184.8 million, net loss of $31.1 million and net income of $16.6 million, and Adjusted EBITDA of $(26.6) million and $29.9 million in the 13-week periods ended June 28, 2026 and June 29, 2025, respectively. We had net revenue of $353.2 million and $347.0 million, net loss of $32.6 million and net income of $33.5 million, and Adjusted EBITDA of $(21.6) million and $57.4 million in the 26-week periods ended June 28, 2026 and June 29, 2025, respectively. Adjusted EBITDA is a non-GAAP financial measure. See the section titled “—Non-GAAP Financial Measure—Adjusted EBITDA” below for the definition of Adjusted EBITDA, as well as a reconciliation of Adjusted EBITDA to net income, the most directly comparable financial measure stated in accordance with GAAP.

Current wording

We had net revenue of $182.2 million and $198.9 million, net loss of $6.5 million and net income of $16.4 million, and Adjusted EBITDA of $1.5 million and $27.4 million in the 13-week periods ended September 27, 2026 and September 28, 2025, respectively. We had net revenue of $535.3 million and $545.9 million, net loss of $39.0 million and net income of $50.0 million, and Adjusted EBITDA of $(20.1) million and $84.8 million in the 39-week periods ended September 27, 2026 and September 28, 2025, respectively. Adjusted EBITDA is a non-GAAP financial measure. See the section titled “—Non-GAAP Financial Measures—Adjusted EBITDA” below for the definition of Adjusted EBITDA, as well as a reconciliation of Adjusted EBITDA to net income, the most directly comparable financial measure stated in accordance with GAAP.

Previous wording

During 2026, as a result of economic uncertainty, an industry-wide oversupply of shell eggs and increased price gaps with certain competing shell egg products, we have experienced declining velocities in our shell egg sales to retail customers. This resulted in increased sales to breaker and wholesale channels, which adversely impacted our financial results in the 13-week and 26-week periods ended June 28, 2026.

Current wording

During 2026, as a result of economic uncertainty, an industry-wide oversupply of shell eggs and increased price gaps with certain competing shell egg products, we have experienced declining velocities in our shell egg sales to retail customers. This resulted in increased sales to breaker and wholesale channels, which adversely impacted our financial results in the 13-week and 39-week periods ended September 27, 2026.

Previous wording

In the 13-week and 26-week periods ended June 28, 2026, we worked with certain of our contracted farmers to address our oversupply through voluntary amendments to their producer contracts to cease production from existing flocks or delay placement of future flocks, in return for payments to such farmers, reflecting a portion of their foregone profits. We expect such supply control measures to continue throughout 2026.

Current wording

In the 13-week and 39-week periods ended September 27, 2026, we worked with certain of our contracted farmers to address our oversupply through voluntary amendments to their producer contracts to cease production from existing flocks or delay placement of future flocks, in return for payments to such farmers, reflecting a portion of their foregone profits. We expect such supply control measures to continue throughout 2026.

Previous wording

In addition, we intend to halt construction on Vital Crossroads, our previously announced planned second egg washing and packing facility with onsite cold storage in Seymour, Indiana, by the end of 2026. We will continue to evaluate our supply needs relative to the planned timing for construction of Vital Crossroads.

Current wording

In addition, we previously announced our intention to halt construction on Vital Crossroads, our previously announced planned second egg washing and packing facility with onsite cold storage in Seymour, Indiana, by the end of 2026. We will continue to evaluate our supply needs relative to the planned timing for construction of Vital Crossroads.

Previous wording

During 2026, we made operational staffing changes to reduce headcount and better align our resources with our growth strategies, resulting in a workforce reduction that impacted approximately 12% of our remote crew members.

Current wording

During 2026, we have made operational staffing changes to reduce headcount and better align our resources with our growth strategies, resulting in a workforce reduction that impacted approximately 12% of our remote crew members.

Previous wording

In May 2026, we made the strategic decision to wind down our butter business to sharpen our focus on our core egg product categories where we see distinct competitive advantages. We expect to complete the wind down of the butter business by the end of fiscal 2026. In connection with the discontinuation plan, we expect to incur butter inventory-related charges, costs, and write-downs, packaging write-downs, and other related discontinuation costs. We are not able to estimate the amount or range of amounts of such potential costs, including any amounts that will result in future cash expenditures at this time. We may also incur additional costs not currently contemplated due to events that may occur as a result of, or that are associated with, the wind down of our butter business.

Current wording

In May 2026, we made the strategic decision to wind down our butter business to sharpen our focus on our core egg product categories where we see distinct competitive advantages. We expect to complete the wind-down of the butter business by the end of fiscal 2026. In connection with the discontinuation plan, we expect to incur butter inventory-related charges, costs, and write-downs. We estimate that the total costs incurred related to the exit of our butter business will be between $8.0 million and $13.0 million, consisting of expenses relating to inventory write-downs, inclusive of the $7.8 million in inventory obsolescence we recorded in the 39-week period ended September 27, 2026.We may also incur additional costs not currently contemplated due to events that may occur as a result of, or that are associated with, the wind-down of our butter business.

Previous wording

Highly Pathogenic Avian Influenza (“HPAI”) and Other Agricultural Diseases

Current wording

Highly Pathogenic Avian Influenza, or HPAI, and Other Agricultural Diseases

Previous wording

Since initial outbreaks of HPAI in early 2022, we have been closely following the progression of the virus and working with our farmers, veterinarians, government health officials and animal welfare auditors to ensure that our flocks are kept as safe as possible. We did not experience an outbreak of HPAI at any of our farms in the 13-week or 26-week periods ended June 28, 2026.

Current wording

Since initial outbreaks of HPAI in early 2022, we have been closely following the progression of the virus and working with our farmers, veterinarians, government health officials and animal welfare auditors to ensure that our flocks are kept as safe as possible. We did not experience an outbreak of HPAI at any of our farms in the 13-week or 39-week periods ended September 27, 2026.

Previous wording

In fiscal 2024, we were made aware of an outbreak of a virus called Egg Drop Syndrome (“EDS”) in the Midwest. EDS is characterized by the production of pale, thin-shelled, soft-shelled, or shell-less eggs by seemingly healthy laying hens. Twelve of our farms were impacted by EDS in fiscal 2025 and one of our farms has been impacted by an outbreak of EDS in fiscal 2026 to date.

Current wording

In fiscal 2024, we were made aware of an outbreak of a virus called Egg Drop Syndrome, or EDS, in the Midwest. EDS is characterized by the production of pale, thin-shelled, soft-shelled, or shell-less eggs by seemingly healthy laying hens. Twelve of our farms were impacted by EDS in fiscal 2025 and one of our farms has been impacted by an outbreak of EDS in fiscal 2026 to date.

Previous wording

At times since 2024, HPAI-related disruptions in the supply of conventional eggs resulted in increased demand for premium egg products such as ours, which occasionally resulted in shortages of these eggs on shelves at our retail customers. While we have not experienced material disruptions to our egg supply due to HPAI and EDS outbreaks, if a substantial portion of our farms or production facilities were affected, this could materially and negatively affect our supply chain and operating results. Additionally, agricultural diseases such as HPAI or EDS have resulted and could in the future result in supply shortages and price increases across the egg market, including shortages of eggs on shelves at our retail customers. We are confident in the measures we have taken to reduce the risk of HPAI and EDS on our farms and production facilities, including through procurement of vaccinations for EDS, as well as our ability to mitigate impacts on supply. However, given continued uncertainty about future outbreaks and governmental responses to such outbreaks, we cannot predict the ultimate impact that agricultural diseases such as HPAI and EDS will have on our business.

Current wording

Additionally, agricultural diseases such as HPAI or EDS have resulted and could in the future result in supply shortages and price increases across the egg market, including shortages of eggs on shelves at our retail customers. We are confident in the measures we have taken to reduce the risk of HPAI and EDS on our farms and production facilities, including through procurement of vaccinations for EDS, as well as our ability to mitigate impacts on supply. However, given continued uncertainty about future outbreaks and governmental responses to such outbreaks, we cannot predict the ultimate impact that agricultural diseases such as HPAI and EDS will have on our business.

Previous wording

In the first half of fiscal 2026, these conditions, together with industry-wide oversupply of shell eggs and increased price gaps with certain competing shell egg products, contributed to a decline in our financial performance and to our financial results falling short of our previously announced guidance. We contract with family farms to purchase all of their egg production for the duration of our contracts. We are contractually obligated to purchase these eggs irrespective of our ability to sell such eggs. In periods of oversupply, we have sold or donated our excess supply at reduced prices or no cost. Our current oversupply of egg inventory has resulted in increased sales to breaker and wholesale channels at lower prices or no cost. We consider excess sales to breaker and wholesale channels to be sales volume in excess of the fiscal 2024 and 2025 average contribution of breaker and wholesale volume to our overall shell egg volume, which was 4.9%. As discussed above, we have implemented certain supply control measures to address the oversupply of our shell eggs, and we expect such measures to continue throughout 2026.

Current wording

Throughout 2026, these conditions, together with industry-wide oversupply of shell eggs and increased price gaps with certain competing shell egg products, contributed to a decline in our financial performance and to our financial results falling short of our previously announced guidance. We contract with family farms to purchase all of their egg production for the duration of our contracts. We are contractually obligated to purchase these eggs irrespective of our ability to sell such eggs. In periods of oversupply, we have sold or donated supply at reduced prices or no cost. Our current oversupply of egg inventory has resulted in increased sales to breaker and wholesale channels at lower prices or no cost. We consider sales to breaker and wholesale channels to be sales volume in excess of the fiscal 2024 and 2025 average contribution of breaker and wholesale volume to our overall shell egg volume, which was 4.9%. As discussed above, we have implemented certain supply control measures to address the oversupply of our shell eggs, and we expect such measures to continue throughout 2026.

Previous wording

In November 2025, the Supreme Court of the United States, or SCOTUS, heard oral arguments on tariffs imposed under the International Emergency Economic Powers Act, or IEEPA. In February 2026, SCOTUS issued a decision invalidating these tariffs; however, President Trump subsequently signed an executive order implementing a non-IEEPA tariff. These actions have contributed to continued uncertainty and volatility in the trade environment. In April 2026, the IEEPA tariff refund process was launched, and we began to receive refunds in the second quarter of fiscal 2026. Ongoing and potential future litigation, rulemaking and policy changes could further alter the tariff regime with little notice. We are continuing to evaluate the potential impact of these developments on our financial statements and business.

Current wording

In November 2025, the Supreme Court of the United States, or SCOTUS, heard oral arguments on tariffs imposed under the International Emergency Economic Powers Act, or IEEPA. In February 2026, SCOTUS issued a decision invalidating these tariffs; however, President Trump subsequently signed an executive order implementing a non-IEEPA tariff. These actions have contributed to continued uncertainty and volatility in the trade environment. In April 2026, the IEEPA tariff refund process was launched, and we began to receive refunds in the second quarter of fiscal 2026 and expect to receive all refunds by the end of fiscal 2026. During the 39-week period ended September 27, 2026, we received refunds for IEEPA tariffs previously paid totaling approximately $1.3 million, which was recognized as a reduction to cost of goods sold. Ongoing and potential future litigation, rulemaking and policy changes could further alter the tariff regime with little notice. We are continuing to evaluate the potential impact of these developments on our financial statements and business.

Previous wording

We have positioned our brand to capitalize on growing consumer interest in natural, clean-label, traceable, ethical, great-tasting and nutritious foods. We believe there is substantial opportunity to grow our consumer base and increase the velocity at which households purchase our products. U.S. household penetration for the shell egg category is approximately 97.3%, while the household penetration for our shell eggs is approximately 10.0%. We intend to increase household penetration by continuing to invest significantly in sales and marketing to educate consumers about our brand, our values and the premium quality of our products. We believe these efforts have helped and will continue to help educate consumers on the attractive attributes of our products, generate further demand for our products and ultimately expand our consumer base. Our ability to continue to attract new consumers will depend, among other things, on the perceived value and quality of our products, the offerings of our competitors and the effectiveness of our marketing efforts. Our performance depends significantly on factors that may affect the level and pattern of consumer spending in the U.S. natural food market in which we operate. Such factors include consumer preference, consumer confidence, consumer income, consumer perception of the safety and quality of our products and shifts in the perceived value for our products relative to alternatives.

Current wording

We have positioned our brand to appeal to growing consumer interest in natural, clean-label, traceable, ethical, great-tasting and nutritious foods. We believe there is substantial opportunity to grow our consumer base and increase the velocity at which households purchase our products. U.S. household penetration for the shell egg category is approximately 97.2%, while the household penetration for our shell eggs is approximately 9.8%. We intend to increase household penetration by continuing to invest significantly in sales and marketing to educate consumers about our brand, our values and the premium quality of our products. We believe these efforts have helped and will continue to help educate consumers on the attractive attributes of our products, generate further demand for our products and ultimately expand our consumer base. Our ability to continue to attract new consumers will depend, among other things, on the perceived value and quality of our products, the offerings of our competitors and the effectiveness of our marketing efforts. Our performance depends significantly on factors that may affect the level and pattern of consumer spending in the U.S. natural food market in which we operate. Such factors include consumer preference, consumer confidence, consumer income, consumer perception of the safety and quality of our products and shifts in the perceived value for our products relative to alternatives.

Previous wording

We believe that our ability to increase the number of customers that sell our products to consumers is an indicator of our market penetration and our future business opportunities. We define our customers as the entities that sell our products to consumers. With certain of our retail customers, like Whole Foods, we sell our products through distributors. We are not able to precisely attribute our net revenue to a specific retailer for products sold through such channels. We rely on third-party data to calculate the portion of retail sales attributable to such retailers, but this data is inherently imprecise because it is based on gross sales generated by our products sold at retailers, without accounting for price concessions, promotional activities or chargebacks in the ordinary course of business, and because it measures retail sales for only the portion of our retailers serviced through distributors. Based on this third-party data and internal analysis, Whole Foods accounted for approximately 21% and 20% of our retail sales for the 13-week periods ended June 28, 2026 and June 29, 2025 and 21% and 20% of our retail sales for the 26-week periods ended June 28, 2026 and June 29, 2025, respectively. Kroger accounted for approximately 12% and 10% of our retail sales for the 13-week periods ended June 28, 2026 and June 29, 2025 and 12% and 10% of our retail sales for the 26-week periods ended June 28, 2026 and June 29, 2025, respectively.

Current wording

We believe that our ability to increase the number of customers that sell our products to consumers is an indicator of our market penetration and our future business opportunities. We define our customers as the entities that sell our products to consumers. With certain of our retail customers, like Whole Foods, we sell our products through distributors. We are not able to precisely attribute our net revenue to a specific retailer for products sold through such channels. We rely on third-party data to calculate the portion of retail sales attributable to such retailers, but this data is inherently imprecise because it is based on gross sales generated by our products sold at retailers, without accounting for price concessions, promotional activities or chargebacks in the ordinary course of business, and because it measures retail sales for only the portion of our retailers serviced through distributors. Based on this third-party data and internal analysis, Whole Foods accounted for approximately 20% and 20% of our retail sales for the 13-week periods ended September 27, 2026 and September 28, 2025 and 20% and 20% of our retail sales for the 39-week periods ended September 27, 2026 and September 28, 2025, respectively. Kroger accounted for approximately 12% and 10% of our retail sales for the 13-week periods ended September 27, 2026 and September 28, 2025 and 12% and 10% of our retail sales for the 39-week periods ended September 27, 2026 and September 28, 2025, respectively.

Previous wording

As of June 28, 2026, there were more than 24,000 stores selling our products. We expect the retail channel to be our largest source of net revenue for the foreseeable future. By capturing greater shelf space, driving higher product velocities and increasing our SKU count, we believe there is meaningful runway for further growth with existing retail customers. Additionally, we believe there is significant opportunity to gain incremental stores from existing customers as well as by adding new retail customers. We also believe there is significant further long-term opportunity in additional distribution channels, including the convenience, drugstore and club markets. Our ability to execute this strategy will increase our opportunities for incremental sales to consumers, and we also believe this growth will allow for margin expansion. To accomplish these objectives, we intend to continue leveraging consumer awareness of and demand for our brand, offering targeted sales incentives to our customers and utilizing customer-specific marketing tactics. Our ability to grow within the retail channel will depend on a number of factors, such as our customers’ satisfaction with the sales, product velocities and profitability of our products.

Current wording

As of September 27, 2026, there were more than 24,500 stores selling our products. We expect the retail channel to be our largest source of net revenue for the foreseeable future. By capturing greater shelf space, driving higher product velocities and increasing our SKU count, we believe there is meaningful runway for further growth with existing retail customers. Additionally, we believe there is significant opportunity to gain incremental stores from existing customers as well as by adding new retail customers. We also believe there is significant further long-term opportunity in additional distribution channels, including the convenience, drugstore and club markets. Our ability to execute this strategy will increase our opportunities for incremental sales to consumers, and we also believe this growth will allow for margin expansion. To accomplish these objectives, we intend to continue leveraging consumer awareness of and demand for our brand, offering targeted sales incentives to our customers and utilizing customer-specific marketing tactics. Our ability to grow within the retail channel will depend on a number of factors, such as our customers’ satisfaction with the sales, product velocities and profitability of our products.

Previous wording

We believe there is significant demand for our products in the foodservice channel since we offer versatile ingredients with high menu penetrations across commercial and non-commercial operator segments. We see considerable opportunity to continue to grow the channel in the medium- to long-term with our two-pronged sales approach to values-aligned foodservice operators and their distributors. We are working with ROOTED Food Sales Agency, a foodservice sales and marketing agency, to increase our category share in broad-line distribution and to access additional national and regional restaurant menus.

Current wording

We believe there is demand for our products in the foodservice channel since we offer versatile ingredients with high menu penetrations across commercial and non-commercial operator segments. We see considerable opportunity to continue to grow the channel in the medium- to long-term with our two-pronged sales approach to values-aligned foodservice operators and their distributors. We are working with ROOTED Food Sales Agency, a foodservice sales and marketing agency, to increase our category share in broad-line distribution and to access additional national and regional restaurant menus.

Previous wording

We intend to continue to strengthen our product offerings by investing in innovation in new and existing categories. We have a history of product introductions and intend to continue to innovate by introducing new products from time to time. Eggs and egg-related products generated $160.4 million in net revenue, approximately 97% of total net revenue, in the 13-week period ended June 28, 2026. Eggs and egg-related products generated $341.5 million in net revenue, approximately 97% of total net revenue in the 26-week period ended June 28, 2026. We expect eggs and egg-related products to be our largest source of net revenue for the foreseeable future. We believe that investments in innovation will contribute to our long-term growth, including by reinforcing our efforts to increase household penetration. Our ability to successfully develop, market and sell new products will depend on a variety of factors, including the availability of capital to invest in innovation, as well as changing consumer preferences and demand for food products.

Current wording

We intend to continue to strengthen our product offerings by investing in innovation in new and existing categories. We have a history of product introductions and intend to continue to innovate by introducing new products from time to time. For example, we announced in October 2026 our launch of a pilot program to offer free-range shell egg products at a limited number of retail locations. Eggs and egg-related products generated $177.2 million in net revenue, approximately 97% of total net revenue, in the 13-week period ended September 27, 2026. Eggs and egg-related products generated $518.7 million in net revenue, approximately 97% of total net revenue in the 39-week period ended September 27, 2026. We expect eggs and egg-related products to be our largest source of net revenue for the foreseeable future. We believe that investments in innovation will contribute to our long-term growth, including by reinforcing our efforts to increase household penetration. Our ability to successfully develop, market and sell new products will depend on a variety of factors, including the availability of capital to invest in innovation, as well as changing consumer preferences and demand for food products.

Previous wording

We periodically offer promotional incentives to our customers, including customer rebates, temporary price reductions, off-invoice discounts, retailer advertisements, product coupons and other trade activities. At the end of each accounting period, we recognize a liability for an estimated promotional allowance reserve. We periodically provide credits or discounts to our customers in the event that products do not conform to customer expectations upon delivery or expire at a customer’s site. We treat these credits and discounts as a reduction of the sales price of the related transaction at the time of sale. We anticipate that these promotional activities, credits and discounts could materially impact our net revenue and that changes in such activities could impact period-over-period results.

Current wording

We periodically offer promotional incentives to our customers, including customer rebates, temporary price reductions, off-invoice discounts, retailer advertisements, product coupons, buy-one-get-one-free programs and other trade activities. At the end of each accounting period, we recognize a liability for an estimated promotional allowance reserve. We periodically provide credits or discounts to our customers in the event that products do not conform to customer expectations upon delivery or expire at a customer’s site. We treat these credits and discounts as a reduction of the sales price of the related transaction at the time of sale. We anticipate that these promotional activities, credits and discounts could materially impact our net revenue and that changes in such activities could impact period-over-period results.

Previous wording

Net revenue is impacted by increases or decreases in volume of the products we sell, as well as price/mix, which refers to the impact on margin of how products are priced and sales are distributed among the different products in our portfolio. Our shell eggs are sold to consumers at a premium price point, and when prices for commodity, private-label, or other premium shell eggs fall relative to the price of our shell eggs (including due to supply fluctuations or pricing or promotional actions that we or our competitors may implement), price-sensitive consumers may choose to purchase shell eggs offered by our competitors instead of our eggs. As a result, lower prices for commodity, private-label or other premium shell eggs may adversely affect our net revenue. In periods of shell egg oversupply, we have been, and may in the future be, required to sell excess shell eggs to breakers or wholesalers at a reduced price, generally dependent upon the commodity price of shell eggs. Net revenue may also vary from period to period depending on the purchase orders we receive, the volume and mix of our products sold, and the channels through which our products are sold.

Current wording

Net revenue is impacted by increases or decreases in volume of the products we sell, as well as price/mix, which refers to the impact on margin of how products are priced and sales are distributed among the different products in our portfolio. Our shell eggs are sold to consumers at a premium price point, and when prices for commodity, private-label, or other premium shell eggs fall relative to the price of our shell eggs (including due to supply fluctuations or pricing or promotional actions that we or our competitors may implement), price-sensitive consumers may choose to purchase shell eggs offered by our competitors instead of our eggs. As a result, lower prices for commodity, private-label or other premium shell eggs may adversely affect our net revenue. In periods of shell egg oversupply, we have been, and may in the future be, required to sell shell eggs to breakers or wholesalers at a reduced price, generally dependent upon the commodity price of shell eggs. Net revenue may also vary from period to period depending on the purchase orders we receive, the volume and mix of our products sold, and the channels through which our products are sold.

Previous wording

The results of operations data for the 13-week and 26-week periods ended June 28, 2026 and June 29, 2025 have been derived from the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report.

Current wording

The results of operations data for the 13-week and 39-week periods ended September 27, 2026 and September 28, 2025 have been derived from the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report.

Previous wording

Includes stock-based compensation expense of $260 and $173 in cost of goods sold for the 13-week periods ended June 28, 2026 and June 29, 2025, respectively.

Current wording

Includes stock-based compensation expense of $233 and $155 in cost of goods sold for the 13-week periods ended September 27, 2026 and September 28, 2025, respectively.

Previous wording

Includes stock-based compensation (benefit) expense of $(1,638) and $2,861 in selling, general and administrative for the 13-week periods ended June 28, 2026 and June 29, 2025, respectively.

Current wording

Includes stock-based compensation expense of $2,889 and $3,084 in selling, general and administrative for the 13-week periods ended September 27, 2026 and September 28, 2025, respectively.

Previous wording

The decrease in net revenue of $18.7 million, or 10%, was primarily driven by a volume-driven decline of $19.8 million, excluding excess breaker and wholesale channel sales, partially offset by a price/mix benefit of $1.1 million. Excess sales to breaker and wholesale channels contributed $0.1 million to net revenue growth, as a large volume increase was almost entirely offset by a price decline. Net revenue from sales through our retail channel was $158.0 million and $176.1 million for the 13-week periods ended June 28, 2026 and June 29, 2025, respectively.

Current wording

The decrease in net revenue of $16.8 million, or 8%, was primarily driven by a price/mix decline of $14.3 million, and a volume-driven decline of $2.2 million, excluding breaker and wholesale channel sales. Sales to breaker and wholesale channels contributed $0.3 million to net revenue decline, as a large volume increase was more than offset by a price decline. Net revenue from sales through our retail channel was $175.1 million and $189.7 million for the 13-week periods ended September 27, 2026 and September 28, 2025, respectively.

Previous wording

The decrease in gross profit of $60.9 million, or 85%, was driven by higher input and production costs and unfavorable sales mix. The unfavorable sales mix was driven by an oversupply of egg inventory, which resulted in increased sales to breaker and wholesale channels at lower prices, reducing gross profit by $19.5 million. In addition, gross margin for the 13-week period ended June 28, 2026 was impacted by a $7.8 million inventory impairment charge related to the exit of our butter products.

Current wording

The decrease in gross profit of $32.8 million, or 44%, was driven by higher input and production costs and unfavorable sales mix. The unfavorable sales mix was driven by an oversupply of egg inventory, which resulted in increased sales to breaker and wholesale channels at lower prices, reducing gross profit by $7.9 million.

Previous wording

a decrease of $2.1 million in employee-related costs, including stock-based compensation, driven by a change in estimate based on revised expectations of the attainment levels for performance metrics of certain PSUs; and

Current wording

a decrease of $4.2 million in employee-related costs, including stock-based compensation, driven by lower compensation expenses and decreased expenses related to employee travel;

Previous wording

an increase of $0.3 million in marketing-related expenses, partially offset by

Current wording

a decrease of $0.3 million in professional services, partially offset by

Previous wording

an increase of $0.3 million in other selling, general, and administrative expenses.

Current wording

an increase of $1.4 million in other selling, general, and administrative expenses; and

Previous wording

an increase of $0.9 million in technology and software-related expenses;

Current wording

an increase of $0.6 million in technology and software-related expenses.

Previous wording

The increase in shipping and distribution costs of $1.7 million, or 19%, was driven by higher fuel rates and unfavorable linehaul rates.

Current wording

The increase in shipping and distribution costs of $2.5 million, or 27%, was driven by higher fuel rates and unfavorable linehaul rates.

Previous wording

The increase in interest expense of $0.2 million, or 93%, was primarily driven by interest incurred on outstanding borrowings on the JPMorgan Credit Facility.

Current wording

The increase in interest expense of $2.7 million, or 1,276%, was primarily driven by interest incurred on the Silver Point Term Loan.

Previous wording

The decrease of $1.1 million in interest income, or 83%, was primarily driven by a decrease in interest income received on our available-for-sale securities and marketable securities.

Current wording

The decrease in interest income of $0.9 million, or 74%, was primarily driven by a decrease in interest income received on our available-for-sale securities and marketable securities.

Previous wording

The increase in other expense, net of $72 thousand, or 19%, was primarily driven by higher losses on our commodity derivative instruments during the 13-week period ended June 28, 2026 as compared to those in the 13-week period ended June 29, 2025.

Current wording

The increase in other income (expense), net of $1.5 million, or 315%, was primarily driven by increased gains on our commodity derivative instruments during the 13-week period ended September 27, 2026 as compared to those in the 13-week period ended September 28, 2025.

Previous wording

The decrease in the income tax (benefit) provision of $17.6 million, or 223%, was primarily related to a decrease in net (loss) income for the 13-week period ended June 28, 2026 as compared to the 13-week period ended June 29, 2025.

Current wording

The decrease in the income tax (benefit) provision of $8.3 million, or 150%, was primarily related to a decrease in net (loss) income for the 13-week period ended September 27, 2026 as compared to the 13-week period ended September 28, 2025.

Previous wording

Includes stock-based compensation expense of $455 and $280 in cost of goods sold for the 26-week periods ended June 28, 2026 and June 29, 2025, respectively.

Current wording

Includes stock-based compensation expense of $688 and $435 in cost of goods sold for the 39-week periods ended September 27, 2026 and September 28, 2025, respectively.

Previous wording

Includes stock-based compensation (benefit) expense of $923 and $5,607 in selling, general and administrative for the 26-week periods ended June 28, 2026 and June 29, 2025, respectively.

Current wording

Includes stock-based compensation expense of $3,812 and $8,691 in selling, general and administrative for the 39-week periods ended September 27, 2026 and September 28, 2025, respectively.

Previous wording

The increase in net revenue of $6.2 million, or 2%, was primarily driven by price/mix benefits of $9.2 million, excluding excess breaker and wholesale channel sales, slightly offset by a volume-driven decline of $2.8 million. Excess sales to breaker and wholesale channels contributed only $0.2 million to net revenue growth, as a large volume increase was more than offset by a price decline. Net revenue from sales through our retail channel was $337.5 million and $330.7 million for the 26-week periods ended June 28, 2026 and June 29, 2025, respectively.

Current wording

The decrease in net revenue of $10.5 million, or 2%, was primarily driven by a price/mix decline of $5.1 million, and a volume-driven decline of $5.0 million, excluding breaker and wholesale channel sales. Sales to breaker and wholesale channels contributed $0.5 million to net revenue decline, because the increase in volume was offset by price declines. Net revenue from sales through our retail channel was $512.6 million and $520.5 million for the 39-week periods ended September 27, 2026 and September 28, 2025, respectively.

Previous wording

The decrease in gross profit of $70.4 million, or 52%, was driven by higher input and production costs and unfavorable sales mix. The unfavorable sales mix was driven by an oversupply of egg inventory, which resulted in increased sales to breaker and wholesale channels at lower prices, reducing gross profit by approximately $23.8 million. In addition, gross margin for the 26-week period ended June 28, 2026 was impacted by a $7.8 million inventory impairment charge related to the exit of our butter products.

Current wording

The decrease in gross profit of $103.2 million, or 49%, was driven by higher input and production costs and unfavorable sales mix. The unfavorable sales mix was driven by an oversupply of egg inventory, which resulted in increased sales to breaker and wholesale channels at lower prices, reducing gross profit by approximately $31.7 million. In addition, gross margin for the 39-week period ended September 27, 2026 was impacted by a $7.8 million inventory impairment charge related to the exit of our butter products.