Traeger Inc

Previous wording

Our revenue decreased by 5.4% for the three months ended March 31, 2024 as compared to the three months ended March 31, 2023, and was $144.9 million for the three months ended March 31, 2024, down from $153.2 million for the three months ended March 31, 2023. We recorded net loss of $4.7 million for the three months ended March 31, 2024, compared to net loss of $10.9 million for the three months ended March 31, 2023.

Current wording

Our revenue decreased by 1.8% and 3.5% for the three and six months ended June 30, 2024, respectively, as compared to the three and six months ended June 30, 2023, respectively, and was $168.5 million and $313.4 million for the three and six months ended June 30, 2024, respectively, down from $171.5 million and $324.7 million for the three and six months ended June 30, 2023, respectively. We recorded a net loss of $2.6 million and $7.3 million for the three and six months ended June 30, 2024, respectively, compared to net loss of $30.2 million and $41.1 million for the three and six months ended June 30, 2023, respectively.

Previous wording

We believe challenging macroeconomic pressures and uncertainties have resulted in decreased discretionary consumer spending, particularly for durable goods, and therefore contributed to a decline in our revenue for the three months ended March 31, 2024, compared to the prior year period. For example, we experienced a mid-single digit percentage decline in demand for grills, as measured by unit volume, for the three months ended March 31, 2024, compared to the prior year period. We expect these macroeconomic trends, and a shift in consumer demand away from big-ticket, home related products such as grills, and towards experiences, services, and leisure, to continue throughout fiscal year end 2024, which could result in continued pressure on our revenue and results of operations.

Current wording

We believe challenging macroeconomic pressures and uncertainties have resulted in decreased discretionary consumer spending, particularly for durable goods, and therefore contributed to a decline in our revenue for the three and six months ended June 30, 2024, compared to the prior year period. For example, we experienced a mid-single digit percentage decline in demand for grills, as measured by unit volume, for the six months ended June 30, 2024, compared to the prior year period. We expect these macroeconomic trends, and a shift in consumer demand away from big-ticket, home related products such as grills, and towards experiences, services, and leisure, to continue throughout fiscal year end 2024, which could result in continued pressure on our revenue and results of operations.

Previous wording

We experienced an increase in excess of 20% in our inbound freight container rates primarily due to global transportation factors for the three months ended March 31, 2024, as compared to the prior year period. If supply chain challenges continue in the future, we will observe increases in our cost of revenues which could impact our operating results.

Current wording

We experienced a mid-double digit increase in our inbound freight container rates primarily due to global transportation factors for the six months ended June 30, 2024, as compared to the prior year period. If supply chain challenges persist, we anticipate increases in our cost of revenues which could impact our future operating results.

Previous wording

In addition, general and administrative expense includes research and development expenses incurred to develop and improve our future products and processes, which primarily consist of employee and facilities-related expenses, including salaries, benefits and stock-based compensation expense, as well as fees for professional services, costs related to prototype tooling and materials, and software platform costs. Research and development expense was $3.7 million and $2.2 million for the three months ended March 31, 2024 and 2023, respectively.

Current wording

In addition, general and administrative expense includes research and development expenses incurred to develop and improve our future products and processes, which primarily consist of employee and facilities-related expenses, including salaries, benefits and stock-based compensation expense, as well as fees for professional services, costs related to prototype tooling and materials, and software platform costs. Research and development expense was $4.8 million and $3.0 million for the three months ended June 30, 2024 and 2023, respectively, and $8.5 million and $5.2 million for the six months ended June 30, 2024 and 2023, respectively.

Previous wording

Amortization of intangible assets primarily consists of amortization of identified finite-lived customer relationships, distributor relationships, non-compete arrangements and trademark assets that were allocated a considerable portion of the purchase price from the corporate reorganization and acquisition of our business in 2017, as well as the July 2021 acquisition of Apption Labs Limited and its subsidiaries (collectively, “Apption Labs”) pursuant to a share purchase agreement (the “Share Purchase Agreement”). These costs are amortized on a straight-line basis over 2.5 to 25 year useful lives and, as a result, amortization expense on these assets is expected to remain stable over the coming years. Future business acquisitions may result in incremental amortization of intangible assets acquired in any such transactions.

Current wording

Amortization of intangible assets primarily consists of amortization of identified finite-lived customer relationships, distributor relationships, non-compete arrangements and trademark assets that were allocated a considerable portion of the purchase price from the corporate reorganization and acquisition of our Company in 2017, as well as the July 2021 acquisition of Apption Labs Limited and its subsidiaries (collectively, “Apption Labs”) pursuant to a share purchase agreement. These costs are amortized on a straight-line basis over 2.5 to 25 year useful lives and, as a result, amortization expense on these assets is expected to remain stable over the coming years. Future business acquisitions may result in incremental amortization of intangible assets acquired in any such transactions.

Previous wording

The fair values of our contingent consideration earn out obligation associated with the Apption Labs business combination is estimated based on probability adjusted present values of the consideration expected to be transferred using significant inputs. At each reporting date, we revalue the contingent consideration obligation to its fair value and records increases and decreases in fair value in the change in fair value of contingent consideration in our accompanying condensed consolidated statements of operations and comprehensive loss. Changes in the fair value of the contingent consideration obligation results from changes in discount periods and rates, and changes in probability assumptions with respect to the likelihood of achieving certain performance targets. For the three months ended March 31, 2024, there was no change in fair value of contingent consideration and in April 2024, the Company paid the remaining $15.0 million of contingent consideration based on the achievement of certain earnings and product launch thresholds for fiscal year 2023.

Current wording

The fair values of our contingent consideration earn out obligation associated with the Apption Labs business combination is estimated based on probability adjusted present values of the consideration expected to be transferred using significant inputs. At each reporting date, we revalue the contingent consideration obligation to its fair value and records increases and decreases in fair value in the general and administrative expenses in our accompanying condensed consolidated statements of operations and comprehensive loss. Changes in the fair value of the contingent consideration obligation results from changes in discount periods and rates, and changes in probability assumptions with respect to the likelihood of achieving certain performance targets. For the three and six months ended June 30, 2024, there was no change in fair value of contingent consideration and in April 2024, the Company paid the remaining $15.0 million of contingent consideration based on the achievement of certain earnings and product launch thresholds for fiscal year 2023.

Previous wording

Total other expense consists of interest expense and other income, net. Interest expense includes interest and other fees associated with our Credit Facilities and Receivables Financing Agreement (each as defined below) as well as the amortization of amounts recorded within accumulated other comprehensive income prior to the dedesignation of the interest rate swap derivative contracts as a cash flow hedge. Other income, net also consists of any unrealized gains (losses) from our interest rate swap derivative contract subsequent to the dedesignation of the swap contract from a cash flow hedge, foreign currency realized and unrealized gains and losses resulting from exchange rate fluctuations on transactions denominated in a currency other than the U.S. Dollar and from the foreign currency contracts that we use to manage our exposure to foreign currency exchange rate risk related to our purchases and international operations.

Current wording

Total other expense consists of interest expense and other income, net. Interest expense includes interest and other fees associated with our Credit Facilities, Receivables Financing Agreement (each as defined below) as well as the amortization of amounts recorded within accumulated other comprehensive income prior to the dedesignation of the interest rate swap derivative contracts as a cash flow hedge. Other income, net also consists of any realized and unrealized gains (losses) from our interest rate swap derivative contract subsequent to the dedesignation of the swap contract from a cash flow hedge, foreign currency realized and unrealized gains and losses resulting from exchange rate fluctuations on transactions denominated in a currency other than the U.S. Dollar and from the foreign currency contracts that we use to manage our exposure to foreign currency exchange rate risk related to our purchases and international operations.

Previous wording

Revenue from our grills decreased by $12.9 million, or 14.4%, to $76.8 million for the three months ended March 31, 2024 compared to $89.7 million for the three months ended March 31, 2023. The decrease was primarily driven by high-single digit percentage decrease in average selling price and mid-single digit percentage reduction in unit volume. Lower unit volume was driven by sales from end-of-life products and new product launches in the comparable period. The decrease in average selling price was primarily due to mix shift to lower priced grills and strategic pricing action on select grills.

Current wording

Revenue from our grills increased by $1.8 million, or 2.0%, to $95.0 million for the three months ended June 30, 2024 compared to $93.1 million for the three months ended June 30, 2023. The increase was primarily driven by high-double digit increase in volume partially offset by mid-double digit reduction in average selling price. Higher unit volume was driven by effective promotional activity and strategic pricing action on select grills. The decrease in average selling price was primarily due to mix shift to lower priced grills, strategic pricing action on select grills, and higher mix of direct import sales.

Previous wording

Revenue from our accessories increased by $2.5 million, or 7.4%, to $35.8 million for the three months ended March 31, 2024 compared to $33.4 million for the three months ended March 31, 2023. The increase was driven primarily by increased sales of MEATER smart thermometers.

Current wording

Revenue from our accessories decreased by $3.8 million, or 8.8%, to $39.7 million for the three months ended June 30, 2024 compared to $43.5 million for the three months ended June 30, 2023. The decrease was driven primarily by lower sales of MEATER smart thermometers.

Previous wording

Gross profit increased by $7.1 million, or 12.9%, to $62.6 million for the three months ended March 31, 2024 compared to $55.4 million for the three months ended March 31, 2023. Gross margin increased to 43.2% for the three months ended March 31, 2024 from 36.2% for the three months ended March 31, 2023. The increase in gross margin was driven primarily by favorability from freight and logistics, pellet mill capacity optimization, and favorable foreign exchange rates.

Current wording

Gross profit increased by $9.0 million, or 14.2%, to $72.3 million for the three months ended June 30, 2024 compared to $63.3 million for the three months ended June 30, 2023. Gross margin increased to 42.9% for the three months ended June 30, 2024 from 36.9% for the three months ended June 30, 2023. The increase in gross margin was driven primarily by favorability from freight and logistics costs, optimization of operations, and favorable foreign exchange rates.

Previous wording

Sales and marketing expense decreased by $0.4 million, or 1.8%, to $21.7 million for the three months ended March 31, 2024 compared to $22.1 million for the three months ended March 31, 2023. As a percentage of revenue, sales and marketing expense increased to 15.0% for the three months ended March 31, 2024 from 14.4% for the three months ended March 31, 2023. The decrease in sales and marketing expense was driven by decreases in demand creation costs, partially offset by increased employee expenses.

Current wording

Sales and marketing expense increased by $0.3 million, or 1.1%, to $28.2 million for the three months ended June 30, 2024 compared to $27.9 million for the three months ended June 30, 2023. As a percentage of revenue, sales and marketing expense increased to 16.8% for the three months ended June 30, 2024 from 16.3% for the three months ended June 30, 2023. The increase in sales and marketing expense was driven by increased investment in brand awareness and increased employee related costs partially offset by reduced professional fees.

Previous wording

Change in fair value of contingent consideration, attributable to the revalued earn out obligation associated with the Apption Labs business combination, decreased by $1.0 million for the three months ended March 31, 2024 as compared to the prior year period. The change in fair value was primarily driven by the change in likelihood of achieving the fiscal year 2023 performance targets. For the three months ended March 31, 2024, there was no change in fair value of contingent consideration and in April 2024, the Company paid the remaining $15.0 million of contingent consideration based on the achievement of certain earnings and product launch thresholds for fiscal year 2023.

Current wording

Change in fair value of contingent consideration, attributable to the revalued earn out obligation associated with the Apption Labs business combination, decreased by $1.8 million for the three months ended June 30, 2024 as compared to the prior year period. The change in fair value was primarily driven by the change during each period in the likelihood of achieving the fiscal year 2023 performance targets. In April 2024, the Company paid the remaining $15.0 million of contingent consideration based on the achievement of certain earnings and product launch thresholds for fiscal year 2023.

Previous wording

Total other expense decreased by $3.1 million, or 41.1%, to $4.4 million for the three months ended March 31, 2024 compared to $7.5 million for the three months ended March 31, 2023. This decrease was primarily due to realized and unrealized gains on our interest rate swap, partially offset by changes in realized and unrealized gains and losses from foreign currencies.

Current wording

Total other expense increased by $5.0 million, or 213.4%, to $7.4 million for the three months ended June 30, 2024 compared to $2.4 million for the three months ended June 30, 2023. This increase was primarily due to decreases in the realized and unrealized gains on our interest rate swap, partially offset by changes in realized and unrealized gains and losses from foreign currencies.

Previous wording

Revenue from our consumables increased by $2.2 million, or 7.4%, to $32.3 million for the three months ended March 31, 2024 compared to $30.0 million for the three months ended March 31, 2023. The increase was driven by an increase in excess of 20% in unit volume of food consumables and a mid-single digit percentage increase in unit volume of wood pellets, partially offset by mid-double digit percentage reduction in average selling price of food consumables.

Current wording

Revenue from our consumables increased by $1.1 million, or 1.8%, to $66.1 million for the six months ended June 30, 2024 compared to $64.9 million for the six months ended June 30, 2023. The increase was driven by an increase in excess of 20% in unit volume of food consumables and low-single digit increase in wood pellet volume, partially offset by low-double digit reduction in average selling price of food consumables.

Previous wording

Historically, our cash requirements have principally been for working capital purposes, capital expenditures, and debt service payments. We have funded our operations through cash flows from operating activities, cash on hand, and borrowings under our credit facilities and receivables financing agreement. Market conditions can impact the viability of these institutions. In the event of failure of any of the financial institutions where we maintain our cash and cash equivalents, there can be no assurance that we would be able to access uninsured funds in a timely manner or at all. Any inability to access or delay in accessing these funds could adversely affect our business and financial position.

Current wording

Historically, our cash requirements have principally been for working capital purposes, capital expenditures, and debt service payments. We have funded our operations through cash flows from operating activities, cash on hand, and borrowings under our credit facilities and receivables financing agreement. In the event of failure of any of our financial institutions where we maintain our cash and cash equivalents, there can be no assurance that we would be able to access uninsured funds in a timely manner or at all. Any inability to access or delay in accessing these funds could adversely affect our business and financial position.

Previous wording

As of March 31, 2024, we had cash and cash equivalents of $23.6 million, $125.0 million borrowing capacity under our Revolving Credit Facility (as defined below) and $4.3 million borrowing capacity under our Receivables Financing Agreement (as defined below). As of March 31, 2024, we had not drawn down on the Revolving Credit Facility and had drawn down $40.6 million on the Receivables Financing Agreement. As of March 31, 2024, the total principal amount outstanding under our First Lien Term Loan Facility (as defined below) was $403.8 million. Based on our current business plan and revenue prospects, we continue to believe that our existing cash and cash equivalents, availability under our Revolving Credit Facility and Receivables Financing Agreement, and our anticipated cash flows from operating activities will be sufficient to meet our working capital and operating resource expenditure requirements for at least the next twelve months from the date of this Quarterly Report on Form 10-Q. However, our future working capital requirements will depend on many factors, including our rate of revenue growth and profitability, the timing and size of future acquisitions, and the timing of introductions of new products and investments in our supply chain and implementation of technologies.

Current wording

As of June 30, 2024, we had cash and cash equivalents of $18.0 million, $125.0 million borrowing capacity under our Revolving Credit Facility (as defined below) and $31.9 million borrowing capacity under our Receivables Financing Agreement (as defined below). As of June 30, 2024, we had no outstanding loan amounts under the Revolving Credit Facility and had drawn down $23.5 million on the Receivables Financing Agreement. As of June 30, 2024, the total principal amount outstanding under our First Lien Term Loan Facility was $403.7 million. Based on our current business plan and revenue prospects, we continue to believe that our existing cash and cash equivalents, availability under our Revolving Credit Facility and Receivables Financing Agreement, and our anticipated cash flows from operating activities will be sufficient to meet our working capital and operating resource expenditure requirements for at least the next twelve months from the date of this Quarterly Report on Form 10-Q. However, our future working capital requirements will depend on many factors, including our rate of revenue growth and profitability, the timing and size of future acquisitions, and the timing of introductions of new products and investments in our supply chain and implementation of technologies.

Previous wording

We may from time to time seek to raise additional equity or debt financing to support our growth or in connection with the acquisition of complementary businesses. Any equity financing we may undertake could be dilutive to our existing stockholders, and any additional debt financing we may undertake could require debt service and financial and operational requirements that could adversely affect our business. There is no assurance we would be able to obtain future financing on acceptable terms or at all. See Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K.

Current wording

We may from time to time seek to raise additional equity or debt financing to support our growth or in connection with the acquisition of complementary businesses. Any equity financing we may undertake could be dilutive to our existing stockholders, and any additional debt financing we may undertake could require debt service and financial and operational requirements that could adversely affect our business. There is no assurance we would be able to obtain future financing on acceptable terms or at all. See Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K and Part II, Item 1A. “Risk Factors” in this Quarterly Report on Form 10-Q.

Previous wording

Cash flows related to operating activities are dependent on net loss, non-cash adjustments to net loss, and changes in working capital. The decrease in cash used in operating activities during the three months ended March 31, 2024 compared to cash used in operating activities during the three months ended March 31, 2023 is primarily due to a decrease in net cash used for working capital, partially offset by a decrease in net loss, adjusted for non-cash items, as compared to the prior year period. The decrease in cash used in working capital was primarily due to a decrease in the change in accounts receivable in the current period, primarily driven by the collections of large trade receivable balances from our direct import program that were outstanding at the beginning of the prior year period, partially offset by an increase in the change in inventory balances in the current period as a result of strategic inventory management to reduce the high inventory levels at the beginning of the prior year period.

Current wording

Cash flows related to operating activities are dependent on net loss, non-cash adjustments to net loss, and changes in working capital. The decrease in cash provided by operating activities during the six months ended June 30, 2024 compared to cash provided by operating activities during the six months ended June 30, 2023 is primarily due to an increase in net cash used for working capital, partially offset by a decrease in net loss, adjusted for non-cash items, as compared to the prior year period. The increase in cash used for working capital was primarily due to a decrease in the change in accounts receivable in the current period, primarily driven by the collections of large trade receivable balances in the prior year period that were outstanding at the beginning of the prior year period, partially offset by a decrease in the change in inventory balances in the current period as a result of strategic inventory management in the prior year period to reduce the high inventory levels at the beginning of the prior year period.

Previous wording

The decrease in cash used in investing activities during the three months ended March 31, 2024 was primarily related to improvement costs for our new corporate headquarters in the prior year period.

Current wording

The increase in cash used in investing activities during the six months ended June 30, 2024 was primarily related to the purchase of tooling equipment and internal-use software costs, partially offset from the prior year sale of property, plant, and equipment.

Previous wording

On June 29, 2021, we refinanced our existing credit facilities and entered into a new first lien credit agreement, as borrower, with Credit Suisse AG, Cayman Islands Branch, as administrative agent (in such capacity, the “Administrative Agent”) and collateral agent, and other lenders party thereto as joint lead arrangers and joint bookrunners (the “First Lien Credit Agreement”). The First Lien Credit Agreement provides for a senior secured term loan facility (the "First Lien Term Loan Facility") and a revolving credit facility (the “Revolving Credit Facility” and, together with the First Lien Term Loan Facility, the “Credit Facilities”). The Company entered into an agency transfer agreement on April 30, 2024, pursuant to which Morgan Stanley Senior Funding, Inc. succeeded Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent for the Credit Facilities. The Company’s obligations under the First Lien Credit Agreement are substantively unchanged.

Current wording

On June 29, 2021, we refinanced our existing credit facilities and entered into a new first lien credit agreement, as borrower, with Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent, and other lenders party thereto as joint lead arrangers and joint bookrunners (the “First Lien Credit Agreement”). The First Lien Credit Agreement provides for a senior secured term loan facility (the “First Lien Term Loan Facility”) and a revolving credit facility (the “Revolving Credit Facility” and, together with the First Lien Term Loan Facility, the “Credit Facilities”). We entered into an agency transfer agreement on April 30, 2024, pursuant to which Morgan Stanley Senior Funding, Inc. succeeded Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent for the Credit Facilities. Our obligations under the First Lien Credit Agreement are substantively unchanged.

Previous wording

The First Lien Term Loan Facility accrues interest at a rate per annum that considers both fixed and floating components. The fixed component ranges from 3.00% to 3.25% per annum based on our Public Debt Rating (as defined in the First Lien Credit Agreement). The floating component is based on the Term SOFR (as defined in the First Lien Credit Agreement) for the relevant interest period. The First Lien Term Loan Facility requires periodic principal payments from December 2021 through

Current wording

The First Lien Term Loan Facility accrues interest at a rate per annum that considers both fixed and floating components. The fixed component ranges from 3.00% to 3.25% per annum based on our Public Debt Rating (as defined in the First Lien Credit Agreement). The floating component is based on the Term SOFR (as defined in the First Lien Credit Agreement) for the relevant interest period. The First Lien Term Loan Facility requires periodic principal payments from December 2021 through June 2028, with any remaining unpaid principal and any accrued and unpaid interest due on the maturity date of June 29, 2028. As of June 30, 2024, the total principal amount outstanding on the First Lien Term Loan Facility was $403.7 million.

Previous wording

Except as noted below, the Credit Facilities are collateralized by substantially all of the assets of TGP Holdings III LLC, TGPX Holdings II LLC, Traeger Pellet Grills Holdings LLC and certain subsidiaries of Traeger Pellet Grills Holdings LLC, including intellectual property, mortgages and the equity interest of each of these respective entities. The assets of Traeger SPE LLC, substantively consisting of our accounts receivable, collateralize the receivables financing agreement discussed below and do not collateralize the Credit Facilities. There are no guarantees from any entities above TGPX Holdings II LLC, including Traeger, Inc.

Current wording

Except as noted below, the Credit Facilities are collateralized by substantially all of the assets of TGP Holdings III LLC, TGPX Holdings II LLC, Traeger Pellet Grills Holdings LLC and certain subsidiaries of Traeger Pellet Grills Holdings LLC, including intellectual property, mortgages and the equity interest of each of these respective entities. The assets of Traeger SPE LLC, substantively consisting of our accounts receivable, collateralize the receivables financing agreement discussed below and do not collateralize the Credit Facilities. There are no guarantees from parent entities above Traeger, Inc.

Previous wording

On November 8, 2023, we entered into Amendment No. 9 to the Receivables Financing Agreement in order to extend the expiration of the facility by one year to June 27, 2025. As part of the amendment, the maximum borrowing capacity was decreased from $100.0 million to $75.0 million and a mechanism was added to allow for seasonal adjustments to the maximum borrowing capacity, which can now be set between $30.0 million and $75.0 million. A seasonal adjustment schedule was established upon the effectiveness of Amendment No. 9, and further adjustments can be made up two times annually at our discretion (with consent of the lenders under the Receivables Financing Agreement). We are required to pay fixed interest on outstanding cash advances of 2.5%, a floating interest based on the CP Rate or Adjusted Term SOFR (each as defined in the Receivables Financing Agreement), and an unused capacity charge that ranges from 0.25% to 0.5%. Amendment No. 9 also implemented a new liquidity threshold at $42.5 million of liquidity. If our liquidity falls below this threshold, it may result in an increase in the required level of reserves, which would result in a reduction of our borrowing base under the Receivables Financing Agreement during such a liquidity shortfall. We were in compliance with the covenants under the Receivables Financing Agreement as of March 31, 2024.

Current wording

On November 8, 2023, we entered into Amendment No. 9 to the Receivables Financing Agreement in order to extend the expiration of the facility by one year to June 27, 2025. As part of the amendment, the maximum borrowing capacity was decreased from $100.0 million to $75.0 million and a mechanism was added to allow for seasonal adjustments to the maximum borrowing capacity, which can now be set between $30.0 million and $75.0 million. A seasonal adjustment schedule was established upon the effectiveness of Amendment No. 9, and further adjustments can be made up two times annually at our discretion (with consent of the lenders under the Receivables Financing Agreement). We are required to pay fixed interest on outstanding cash advances of 2.5%, a floating interest based on the CP Rate or Adjusted Term SOFR (each as defined in the Receivables Financing Agreement), and an unused capacity charge that ranges from 0.25% to 0.5%. Amendment No. 9 also implemented a new liquidity threshold at $42.5 million of liquidity. If our liquidity falls below this threshold, it may result in an increase in the required level of reserves, which would result in a reduction of our borrowing base under the Receivables Financing Agreement during such a liquidity shortfall.

Previous wording

As of March 31, 2024, we had drawn down $40.6 million under this facility for general corporate and working capital purposes.

Current wording

As of June 30, 2024, we had drawn down $23.5 million under this facility for general corporate and working capital purposes.

Previous wording

Our critical accounting policies and estimates are described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K, the notes to the consolidated financial statements included therein and Note 2 –Summary of Significant Accounting Policies to the accompanying unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q. During the three months ended March 31, 2024, there were no material changes to our critical accounting policies and estimates from those discussed in our Annual Report on Form 10-K.

Current wording

Our critical accounting policies and estimates are described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K, the notes to the consolidated financial statements included therein and Note 2 –Summary of Significant Accounting Policies to the accompanying unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q. During the six months ended June 30, 2024, there were no material changes to our critical accounting policies and estimates from those discussed in our Annual Report on Form 10-K.

Previous wording

For information regarding recent accounting pronouncements, see Note 2 –Summary of Significant Accounting Policies to the accompanying unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.

Current wording

For information regarding recent accounting pronouncements, see Note 2 –Summary of Significant Accounting Policies to the unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.