Simply Good Foods Co 10-Q

Item 1. Financial Statements (Unaudited) The Simply Good Foods Company and Subsidiaries Consolidated Balance Sheets (Unaudited, dollars in thousands, except share and per share data) November 29, 2025 August 30, 2025 Assets Current assets: Cash $ 194,051 $ 98,468 Accounts receivable, net 129,178 164,978 Inventories 181,148 167,217 Prepaid expenses 4,398 7,209 Other current assets 5,064 15,812 Total current assets 513,839 453,684 Long-term assets: Property and equipment, net 38,851 39,738 Intangible assets, net 1,257,642 1,261,603 Goodwill 589,974 589,974 Other long-term assets 50,321 51,046 Total assets $ 2,450,627 $ 2,396,045 Liabilities and stockholders’ equity Current liabilities: Accounts payable $ 75,486 $ 78,298 Accrued interest 66 44 Accrued expenses and other current liabilities 27,069 46,219 Total current liabilities 102,621 124,561 Long-term liabilities: Long-term debt, less current maturities 396,744 249,066 Deferred income taxes 169,627 166,091 Other long-term liabilities 47,519 49,494 Total liabilities 716,511 589,212 See commitments and contingencies (Note 9) Stockholders’ equity: Preferred stock, $0.01 par value, 100,000,000 shares authorized, none issued — — Common stock, $0.01 par value, 600,000,000 shares authorized, 103,940,255 and 103,688,071 shares issued at November 29, 2025, and August 30, 2025, respectively 1,039 1,037 Treasury stock, 8,941,085 shares and 3,957,571 shares at cost at November 29, 2025, and August 30, 2025, respectively ( 230,026 ) ( 129,337 ) Additional paid-in-capital 1,349,610 1,346,687 Retained earnings 616,148 590,879 Accumulated other comprehensive loss ( 2,655 ) ( 2,433 ) Total stockholders’ equity 1,734,116 1,806,833 Total liabilities and stockholders’ equity $ 2,450,627 $ 2,396,045 See accompanying notes to the unaudited consolidated financial statements. 3 Table of Contents The Simply Good Foods Company and Subsidiaries Consolidated Statements of Operations and Comprehensive Income (Unaudited, dollars in thousands, except share and per share data) Thirteen Weeks Ended November 29, 2025 November 30, 2024 Net sales $ 340,198 $ 341,268 Cost of goods sold 230,298 210,782 Gross profit 109,900 130,486 Operating expenses: Selling and marketing 29,677 32,994 General and administrative 38,006 38,064 Depreciation and amortization 4,633 4,160 Business transaction costs — 643 Total operating expenses 72,316 75,861 Income from operations 37,584 54,625 Other income (expense): Interest income 499 776 Interest expense ( 4,286 ) ( 7,861 ) (Loss) gain on foreign currency transactions ( 57 ) 120 Other income 76 15 Total other income (expense) ( 3,768 ) ( 6,950 ) Income before income taxes 33,816 47,675 Income tax expense 8,547 9,553 Net income $ 25,269 $ 38,122 Other comprehensive income: Foreign currency translation, net of reclassification adjustments ( 222 ) ( 387 ) Comprehensive income $ 25,047 $ 37,735 Earnings per share from net income: Basic $ 0.26 $ 0.38 Diluted $ 0.26 $ 0.38 Weighted average shares outstanding: Basic 98,749,340 100,394,693 Diluted 99,051,004 101,479,603 See accompanying notes to the unaudited consolidated financial statements. 4 Table of Contents The Simply Good Foods Company and Subsidiaries Consolidated Statements of Cash Flows (Unaudited, dollars in thousands) Thirteen Weeks Ended November 29, 2025 November 30, 2024 Operating activities Net income $ 25,269 $ 38,122 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 6,205 5,047 Amortization of deferred financing costs and debt discount 150 506 Stock compensation expense 3,083 3,844 Estimated credit losses 20 750 Unrealized loss (gain) on foreign currency transactions 57 ( 120 ) Deferred income taxes 3,536 3,374 Amortization of operating lease right-of-use asset 1,480 1,678 Other ( 279 ) ( 402 ) Changes in operating assets and liabilities: Accounts receivable, net 35,768 67 Inventories ( 13,605 ) ( 13,157 ) Prepaid expenses 2,672 ( 958 ) Other current assets 10,794 ( 1,396 ) Accounts payable ( 2,012 ) 319 Accrued interest 22 ( 189 ) Accrued expenses and other current liabilities ( 22,288 ) ( 3,707 ) Other assets and liabilities ( 778 ) ( 1,757 ) Net cash provided by operating activities 50,094 32,021 Investing activities Purchases of property and equipment ( 2,096 ) ( 307 ) Investments in intangible and other assets — ( 362 ) Net cash used in investing activities ( 2,096 ) ( 669 ) Financing activities Proceeds from option exercises 1,056 9,984 Tax payments related to issuance of restricted stock units and performance stock units ( 1,214 ) ( 2,315 ) Repurchase of common stock ( 99,638 ) — Principal payments of long-term debt — ( 50,000 ) Proceeds from issuance of long-term debt 150,000 — Deferred financing costs ( 2,585 ) — Net cash provided by (used in) financing activities 47,619 ( 42,331 ) Cash and cash equivalents Net increase (decrease) in cash 95,617 ( 10,979 ) Effect of exchange rate on cash ( 34 ) 208 Cash at beginning of period 98,468 132,530 Cash and cash equivalents at end of period $ 194,051 $ 121,759 5 Table of Contents Thirteen Weeks Ended November 29, 2025 November 30, 2024 Supplemental disclosures of cash flow information Cash paid for interest $ 4,114 $ 7,544 Cash paid for taxes $ 29 $ 395 Non-cash investing and financing transactions Non-cash credits for repayment of note receivable $ 49 $ 200 Non-cash additions to property and equipment $ 42 $ 59 Non-cash additions to intangible assets $ — $ 64 See accompanying notes to the unaudited consolidated financial statements. 6 Table of Contents The Simply Good Foods Company and Subsidiaries Consolidated Statements of Stockholders’ Equity (Unaudited, dollars in thousands, except share data) Common Stock Treasury Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss Total Shares Amount Shares Amount Balance at August 30, 2025 103,688,071 $ 1,037 3,957,571 $ ( 129,337 ) $ 1,346,687 $ 590,879 $ ( 2,433 ) $ 1,806,833 Net income — — — — — 25,269 — 25,269 Stock-based compensation — — — — 3,083 — — 3,083 Foreign currency translation adjustments — — — — — — ( 222 ) ( 222 ) Repurchase of common stock — — 4,983,514 ( 100,689 ) — — — ( 100,689 ) Shares issued upon vesting of restricted stock units and performance stock units 164,184 1 — — ( 1,215 ) — — ( 1,214 ) Exercise of options to purchase common stock 88,000 1 — — 1,055 — — 1,056 Balance at November 29, 2025 103,940,255 $ 1,039 8,941,085 $ ( 230,026 ) $ 1,349,610 $ 616,148 $ ( 2,655 ) $ 1,734,116 Common Stock Treasury Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss Total Shares Amount Shares Amount Balance at August 31, 2024 102,515,315 $ 1,025 2,365,100 $ ( 78,451 ) $ 1,319,686 $ 487,265 $ ( 2,039 ) $ 1,727,486 Net income — — — — — 38,122 — 38,122 Stock-based compensation — — — — 3,654 — — 3,654 Foreign currency translation adjustments — — — — — — ( 387 ) ( 387 ) Shares issued upon vesting of restricted stock units and performance stock units 164,093 2 — — ( 2,317 ) — — ( 2,315 ) Exercise of options to purchase common stock 713,751 7 — — 9,977 — — 9,984 Balance at November 30, 2024 103,393,159 $ 1,034 2,365,100 $ ( 78,451 ) $ 1,331,000 $ 525,387 $ ( 2,426 ) $ 1,776,544 See accompanying notes to the unaudited consolidated financial statements. 7 Table of Contents Notes to Unaudited Consolidated Financial Statements (Unaudited, dollars in thousands, except for share and per share data) 1. Nature of Operations and Principles of Consolidation Description of Business The Simply Good Foods Company (“Simply Good Foods” or the “Company”), headquartered in Denver, Colorado, is a consumer packaged food and beverage company with ambitious goals to raise the bar on what food can be with trusted brands and innovative nutritious snacking products. Within our portfolio of trusted brands (Quest, Atkins, and OWYN), we offer a wide variety of nutritional snacks and beverages, including high protein chips, bars, ready-to-drink (RTD) shakes, and powders, and low sugar, low carb sweets and baked goods. We are a leader of the nutritious snacking movement, poised to expand our healthy lifestyle platform through innovation-driven organic growth and external investment opportunities. Our nutritious snacking platform consists of brands that specialize in providing products for consumers that follow certain nutritional philosophies and health-and-wellness trends: Quest for consumers seeking a variety of protein-rich foods and beverages that also limit sugars and simple carbohydrates, Atkins for those following a low-carbohydrate lifestyle or seeking to manage weight or blood sugar levels, and OWYN for consumers seeking protein-rich beverages that are plant-based and tested for the top nine allergens that also limit sugars and simple carbohydrates. We distribute our products in major retail channels, primarily in North America, including grocery, club, and mass merchandise, as well as through e-commerce, convenience, specialty, and other channels. Our portfolio of nutritious snacking brands gives us a strong platform with which to introduce new products, expand distribution, and attract new consumers to our products. The common stock of Simply Good Foods is listed on the Nasdaq Capital Market under the symbol “SMPL.” Unaudited Interim Consolidated Financial Statements The unaudited interim consolidated financial statements include the accounts of Simply Good Foods and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. Unless the context otherwise requires, “we,” “us,” “our” and the “Company” refer to Simply Good Foods and its subsidiaries. In context, “Quest” may also refer to the Quest brand, “Atkins” may also refer to the Atkins brand, and “OWYN” may also refer to the OWYN brand. Atkins, Atkins Endulge, Quest, OWYN, and the Simply Good logo are either registered trademarks or trademarks of the Company’s wholly owned subsidiary Simply Good Foods USA, Inc. or one of its affiliates in the United States and elsewhere. All rights are reserved. The Company maintains its accounting records on a 52/53-week fiscal year, ending on the last Saturday in August. The interim consolidated financial statements and related notes of the Company and its subsidiaries are unaudited. The unaudited interim consolidated financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”). The unaudited interim consolidated financial statements reflect all adjustments and disclosures which are, in the Company’s opinion, necessary for a fair presentation of the results of operations, financial position and cash flows for the indicated periods. All such adjustments were of a normal and recurring nature unless otherwise disclosed. The year-end balance sheet data was derived from the audited financial statements and, in accordance with the instructions to Form 10-Q, certain information and footnote disclosures required by GAAP have been condensed or omitted. The results reported in these unaudited interim consolidated financial statements are not necessarily indicative of the results that may be reported for the entire fiscal year and should be read in conjunction with the Company’s consolidated financial statements for the fiscal year ended August 30, 2025, included in the Company’s Annual Report on Form 10-K (“Annual Report”) filed with the SEC on October 28, 2025. 8 Table of Contents 2. Summary of Significant Accounting Policies Refer to Note 2, Summary of Significant Accounting Policies , to the consolidated financial statements included in the Annual Report for a description of significant accounting policies. Recently Issued and Adopted Accounting Pronouncements Recently Issued Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures (“ASU 2023-09”), which updates disclosures required in the footnotes to the financial statements to further aid investors in understanding how to analyze income tax reporting. The amendments are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available. The amendments should be applied on a prospective basis, however, retrospective application is permitted. The Company is currently evaluating the provisions of the amendments and the effect on its future consolidated financial statements. In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), which will improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses in commonly presented expense captions such as cost of sales, SG&A, and R&D. The amendments are effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted for annual financial statements that have not yet been issued or made available. The amendments should be applied on either (1) prospectively to financial statements issued for reporting periods after the effective date, or (2) retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the provisions of the amendments and the effect on its future consolidated financial statements. In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal Use Software (“ASU 2025-06”), which will improve disclosures surrounding internal-use software and the timing of capitalization when companies use the incremental and iterative development method. The amendments are effective for fiscal years beginning after December 15, 2027, and for interim periods within those fiscal years. Early adoption is permitted. The amendments should be applied through (1) a prospective transition approach, (2) a retrospective transition approach, or (3) a modified transition approach that is based on the status of the project and whether software costs were capitalized before the date of adoption. The Company is currently evaluating the provisions of the amendments and the effect on its future consolidated financial statements. No other new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material effect on the Company’s consolidated financial statements. 3. Revenue Recognition Revenue from transactions with external customers for each of the Company’s products would be impracticable to disclose and management does not view its business by product line. The following is a summary of revenue disaggregated by geographic area and brands: Thirteen Weeks Ended (In thousands) November 29, 2025 November 30, 2024 North America (1) Atkins $ 90,270 $ 108,168 Quest 210,343 191,937 OWYN 31,182 32,254 Total North America 331,795 332,359 International 8,403 8,909 Total net sales $ 340,198 $ 341,268 (1) The North America geographic area consists of net sales substantially related to the United States and there is no individual foreign country to which more than 10% of the Company’s net sales are attributed or that is otherwise deemed individually material. Charges related to credit losses on accounts receivable from transactions with external customers were immaterial for the thirteen weeks ended November 29, 2025, and $ 0.8 million for the thirteen weeks ended November 30, 2024. As of both November 29, 2025, and August 30, 2025, the allowance for credit losses related to accounts receivable were $ 0.9 million. 9 Table of Contents 4. Goodwill and Intangibles As of November 29, 2025, and August 30, 2025, Goodwill in the Consolidated Balance Sheets was $ 590.0 million. There were no impairment charges related to goodwill during the thirteen weeks ended November 29, 2025, or since the inception of the Company. Intangible assets, net in the Consolidated Balance Sheets consists of the following: November 29, 2025 (In thousands) Useful life Gross carrying amount Accumulated amortization Net carrying amount Intangible assets with indefinite life: Brands and trademarks Indefinite life $ 1,142,000 $ — $ 1,142,000 Intangible assets with finite lives: Customer relationships 15 years 194,500 81,380 113,120 Licensing agreements 10 years 16,072 14,757 1,315 Proprietary recipes and formulas 7 years 7,000 7,000 — Software and website development costs 3 - 5 years 6,641 5,434 1,207 $ 1,366,213 $ 108,571 $ 1,257,642 August 30, 2025 (In thousands) Useful life Gross carrying amount Accumulated amortization Net carrying amount Intangible assets with indefinite life: Brands and trademarks Indefinite life $ 1,142,000 $ — $ 1,142,000 Intangible assets with finite lives: Customer relationships 15 years 194,500 78,138 116,362 Licensing agreements 10 years 16,072 14,319 1,753 Proprietary recipes and formulas 7 years 7,000 7,000 — Software and website development costs 3 - 5 years 6,641 5,153 1,488 $ 1,366,213 $ 104,610 $ 1,261,603 Changes in Intangible assets, net during the thirteen weeks ended November 29, 2025, were primarily related to recurring amortization expense. Amortization expense related to intangible assets was $ 4.0 million for the thirteen weeks ended November 29, 2025, and $ 3.7 million for the thirteen weeks ended November 30, 2024. There were no impairment charges related to its indefinite-lived or finite-lived intangible assets during the thirteen weeks ended November 29, 2025, and November 30, 2024. We believe the estimates and assumptions utilized in our impairment assessments are reasonable and are comparable to those that would be used by other marketplace participants. However, actual events and results could differ substantially from those utilized in our initial valuations. Significant declines of future revenue projections or changes of other assumptions used in estimating fair values versus those utilized at the time of the initial valuations could result in impairment charges that could materially affect the consolidated financial statements. Estimated future amortization for each of the next five fiscal years and thereafter is as follows: (In thousands) Amortization Remainder of 2026 $ 11,638 2027 13,575 2028 12,967 2029 12,967 2030 12,967 2031 and thereafter 51,528 Total $ 115,642 10 Table of Contents 5. Long-Term Debt and Line of Credit On July 7, 2017, the Company (through certain of its subsidiaries) entered into a credit agreement with Barclays Bank PLC and other parties (as amended to date, the “Credit Agreement”). The Credit Agreement at that time provided for (i) a term facility of $ 200.0 million (“Term Facility”) with a seven -year maturity and (ii) a revolving credit facility of up to $ 75.0 million (the “Revolving Credit Facility”) with a five -year maturity. Substantially concurrent with the consummation of the business combination which formed the Company between Conyers Park Acquisition Corp. and NCP-ATK Holdings, Inc. on July 7, 2017, the full $ 200.0 million of the Term Facility (the “Term Loan”) was drawn. On November 7, 2019, the Company entered into a second amendment (the “Incremental Facility Amendment”) to the Credit Agreement to increase the principal borrowed on the Term Facility by $ 460.0 million. The Term Facility together with the incremental borrowing make up the Initial Term Loans (as defined in the Incremental Facility Amendment). The Incremental Facility Amendment was executed to partially finance the acquisition of Quest Nutrition, LLC on November 7, 2019. No amounts under the Term Facility were repaid as a result of the execution of the Incremental Facility Amendment. Effective as of December 16, 2021, the Company entered into a third amendment (the “Extension Amendment”) to the Credit Agreement. The Extension Amendment provided for an extension of the stated maturity date of the Revolving Commitments and Revolving Loans (each as defined in the Credit Agreement) from July 7, 2022, to the earlier of (i) 91 days prior to the then-effective maturity date of the Initial Term Loans and (ii) December 16, 2026. On January 21, 2022, the Company entered into the “2022 Repricing Amendment” to the Credit Agreement. The 2022 Repricing Amendment, among other things, (i) reduced the interest rate per annum applicable to the Initial Term Loans outstanding under the Credit Agreement immediately prior to the effective date of the 2022 Repricing Amendment, (ii) reset the prepayment premium for the existing Initial Term Loans to apply to Repricing Transactions (as defined in the Credit Agreement) that occur within six months after the effective date of the 2022 Repricing Amendment, and (iii) implemented SOFR and related replacement provisions for LIBOR. On April 25, 2023, the Company entered into the “2023 Repricing Amendment” to the Credit Agreement. The 2023 Repricing Amendment, (i) reduced the interest rate per annum applicable to the Initial Term Loans outstanding under the Credit Agreement immediately prior to April 25, 2023, and (ii) provided for an extension of the maturity date of the Initial Term Loans from July 7, 2024, to March 17, 2027. On June 13, 2024, the Company entered into a sixth amendment (the “2024 Incremental Facility Amendment”) to the Credit Agreement to increase the principal borrowed on the Term Facility by $ 250.0 million. The terms of the incremental borrowing are the same as the terms of the outstanding borrowings under the Term Facility. The 2024 Incremental Facility Amendment was executed to partially finance the OWYN Acquisition. No amounts under the Term Facility were repaid as a result of the execution of the 2024 Incremental Facility Amendment. On January 31, 2025, the Company entered into a seventh amendment (the “2025 Repricing Amendment”) to the Credit Agreement to reduce the interest rate per annum applicable to the Initial Term Loans outstanding under the Credit Agreement immediately prior to the effective date of the 2025 Repricing Amendment. On November 19, 2025, the Company entered into an eighth amendment (the “2026 Incremental Facility Amendment”) to the Credit Agreement to increase the principal borrowed on the Term Facility by $ 150.0 million and provided for an extension of the maturity date from March 17, 2027 to March 17, 2030. The 2026 Incremental Facility Amendment also provided for an extension of the stated maturity date of the Revolving Commitments and Revolving Loans (each as defined in the Credit Agreement) from December 16, 2026, to the earlier of (i) 91 days prior to the then-effective maturity date of the Term Facility and (ii) December 16, 2029. The terms of the incremental borrowing are substantially the same as the terms of the outstanding borrowings under the Term Facility. No amounts of the Term Facility were repaid as a result of the execution of the 2026 Incremental Facility Amendment. Effective as of the 2026 Incremental Facility Amendment, the interest rate per annum for the Initial Term Loans is based on either: i. A base rate equaling the higher of (a) the “prime rate,” (b) the federal funds effective rate plus 0.50 %, or (c) the Adjusted Term SOFR Rate (as defined in the Credit Agreement) applicable for an interest period of one month plus 1.00 % plus (x) 1.00 % margin for the Term Loan or (y) 1.00 % margin for the Revolving Credit Facility; or ii. SOFR, subject to a floor of 0.00 %, plus (x) 2.00 % margin for the Term Loan or (y) 2.00 % margin for the Revolving Credit Facility. In connection with the closing of the 2026 Incremental Facility Amendment, the Company expensed $ 2.5 million of non-deferrable third-party costs through General and administrative within the Consolidated Statements of Operations and Comprehensive Income and capitalized $ 2.6 million of upfront lender fees (original issue discount) and third-party financing costs. The Simply Good Foods Company is not a borrower under the Credit Agreement and has not provided a guarantee of the Credit Agreement. Simply Good Foods USA, Inc., is the administrative borrower and certain other subsidiary holding companies are co-borrowers under the Credit Agreement. Each of the Company’s domestic subsidiaries that are not a named borrower under the Credit Agreement has 11 Table of Contents provided a guarantee on a secured basis. As security for the payment or performance of the debt under the Credit Agreement, the borrowers and the guarantors have pledged certain equity interests in their respective subsidiaries and granted the lenders a security interest in substantially all of their domestic assets. All guarantors other than Quest Nutrition, LLC and Only What You Need, Inc. are holding companies with no assets other than their investments in their respective subsidiaries. The Credit Agreement contains certain financial and other covenants that limit the Company’s ability to, among other things, incur and/or undertake asset sales and other dispositions, liens, indebtedness, certain acquisitions and investments, consolidations, mergers, reorganizations and other fundamental changes, payment of dividends and other distributions to equity and warrant holders, and prepayments of material subordinated debt, in each case, subject to customary exceptions materially consistent with credit facilities of such type and size. The Revolving Credit Facility has a maximum total net leverage ratio equal to or less than 6.00 :1.00 contingent on credit extensions in excess of 30 % of the total amount of commitments available under the Revolving Credit Facility. Any failure to comply with the restrictions of the credit facilities may result in an event of default. The Company was in compliance with all covenants as of November 29, 2025, and August 30, 2025, respectively. Long-term debt consists of the following: (In thousands) November 29, 2025 August 30, 2025 Term Facility (effective rate of 5.9% at November 29, 2025) $ 400,000 $ 250,000 Less: Deferred financing fees 3,256 934 Long-term debt, net of deferred financing fees $ 396,744 $ 249,066 The Company is no t required to make principal payments on the Term Facility over the twelve months following the period ended November 29, 2025. The outstanding balance of the Term Facility is due upon its maturity in March 2030. As of November 29, 2025, the Company had letters of credit in the amount of $ 0.8 million outstanding. These letters of credit offset against the $ 75.0 million availability of the Revolving Credit Facility and exist to support two of the Company’s leased buildings. No amounts were drawn against these letters of credit as of November 29, 2025. The Company utilizes market approaches to estimate the fair value of certain outstanding borrowings by discounting anticipated future cash flows derived from the contractual terms of the obligations and observable market interest and foreign exchange rates. The Company carries debt at historical cost and discloses fair value. As of November 29, 2025, and August 30, 2025, the book value of the Company’s debt approximated fair value. The estimated fair value of the Term Loan is valued based on observable inputs and classified as Level 2 in the fair value hierarchy. 6. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measurements, a three-tier fair value hierarchy, which prioritizes the inputs used in the valuation methodologies, is used: Level 1 – Valuations based on quoted prices for identical assets and liabilities in active markets. Level 2 – Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Level 3 – Valuations based on unobservable inputs reflecting the Company’s own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment. Components of the balance sheet such as accounts receivable, cash and cash equivalents, and others approximate fair value as of November 29, 2025. 12 Table of Contents 7. Income Taxes The tax expense and the effective tax rate resulting from operations were as follows: Thirteen Weeks Ended (In thousands) November 29, 2025 November 30, 2024 Income before income taxes $ 33,816 $ 47,675 Provision for income taxes $ 8,547 $ 9,553 Effective tax rate 25.3 % 20.0 % The effective tax rate for the thirteen weeks ended November 29, 2025 was 5.3 % higher than the effective tax rate for the thirteen weeks ended November 30, 2024, which was primarily due to the absence of excess tax benefits from stock option exercises recognized in the prior-year period. 8. Leases The Company generally leases office space and distribution centers in the United States through operating lease agreements. As of the thirteen weeks ended November 29, 2025, the Company had no finance lease agreements. Our leases have remaining lease terms up to 7 years and most include an option to renew for additional terms. The Company’s lease costs recognized in the Consolidated Statement of Operations consist of the following: Thirteen Weeks Ended (In thousands) Statements of Operations Caption November 29, 2025 November 30, 2024 Operating lease cost: Lease cost Cost of goods sold and General and administrative $ 2,304 $ 2,209 Variable lease cost (1) Cost of goods sold and General and administrative 1,274 858 Total operating lease cost 3,578 3,067 Total lease cost $ 3,578 $ 3,067 (1) Variable lease cost primarily consists of common area maintenance, such as cleaning and repairs. The right-of-use assets and corresponding liabilities related to operating are as follows: (In thousands) Balance Sheets Caption November 29, 2025 August 30, 2025 Assets Operating lease right-of-use assets Other long-term assets $ 42,638 $ 44,118 Total lease assets $ 42,638 $ 44,118 Liabilities Current: Operating lease liabilities Accrued expenses and other current liabilities $ 6,823 $ 5,867 Long-term: Operating lease liabilities Other long-term liabilities 47,519 49,494 Total lease liabilities $ 54,342 $ 55,361 13 Table of Contents Future maturities of lease liabilities as of November 29, 2025, were as follows: (In thousands) Operating Leases Fiscal year ending: Remainder of 2026 $ 7,206 2027 10,927 2028 10,388 2029 10,438 2030 10,549 Thereafter 16,146 Total lease payments 65,654 Less: Interest ( 11,312 ) Present value of lease liabilities $ 54,342 The weighted-average remaining lease terms and weighted-average discount rates for operating leases were as follows: November 29, 2025 August 30, 2025 Weighted-average remaining lease term (in years) Operating leases 6.06 6.31 Weighted-average discount rate Operating leases 6.0 % 6.0 % Supplemental and other information related to operating leases was as follows: Thirteen Weeks Ended (In thousands) November 29, 2025 November 30, 2024 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 2,566 $ 2,510 9. Commitments and Contingencies Litigation The Company is a party to certain litigation and claims that are considered normal to the operations of the business. From time to time, the Company has been and may again become involved in legal proceedings arising in the ordinary course of business. The Company is not presently a party to any litigation that it believes to be material, and the Company is not aware of any pending or threatened litigation against it that its management believes could have a material adverse effect on its business, operating results, financial condition or cash flows. Other The Company enters into endorsement contracts with certain celebrity figures and social media influencers to promote and endorse the Quest, Atkins, and OWYN brands and product lines. These contracts contain endorsement fees, which are expensed ratably over the life of the contract, and performance fees, that are recognized at the time of achievement. Based on the terms of contracts in place and achievement of performance conditions as of November 29, 2025, the Company will be required to make payments of $ 0.1 million over the next year. 14 Table of Contents 10. Stockholders’ Equity Stock Repurchase Program The Company adopted a $ 50.0 million stock repurchase program on November 13, 2018. On April 13, 2022, October 21, 2022, and October 21, 2025, the Company announced that its Board of Directors had approved the addition of $ 50.0 million, $ 50.0 million, and $150.0 million, respectively, to its stock repurchase program, resulting in authorized stock repurchases of up to an aggregate of $ 300.0 million. Under the stock repurchase program, the Company may repurchase shares from time to time in the open market or in privately negotiated transactions. The stock repurchase program does not obligate the Company to acquire any specific number of shares or acquire shares over any specific period of time. The stock repurchase program may be suspended or discontinued at any time by the Company and does not have an expiration date. During the thirteen weeks ended November 29, 2025, the Company repurchased 4,983,514 shares of common stock at an average price of $ 19.99 per share, inclusive of commissions and exclusive of accrued excise tax. The U.S. Inflation Reduction Act of 2022 requires a 1% excise tax on the net amount of share repurchases. The Company did not repurchase any shares of common stock during the thirteen weeks ended November 30, 2024. As of November 29, 2025, approximately $ 71.0 million remained available under the stock repurchase program. In January 2026, the Company's Board of Directors approved a $200 million increase to its existing stock repurchase program. Subsequent to the thirteen weeks ended November 29, 2025, and through January 6, 2026, the Company repurchased 2,430,028 shares of common stock at an average price of $19.34 per share, inclusive of commissions and exclusive of accrued excise tax. As of January 6, 2026, the Company has approximately $224.0 million available under its revised stock repurchase program. 11. Earnings Per Share Basic earnings or loss per share is based on the weighted average number of common shares issued and outstanding. In computing diluted earnings per share, basic earnings per share is adjusted for the assumed issuance of all potentially dilutive securities, including the Company’s employee stock options and non-vested stock units. In periods in which the Company has a net loss, diluted loss per share is based on the weighted average number of common shares issued and outstanding as the effect of including common stock equivalents outstanding would be anti-dilutive. The following table reconciles the numerators and denominators used in the computations of both basic and diluted earnings per share: Thirteen Weeks Ended (In thousands, except per share data) November 29, 2025 November 30, 2024 Basic earnings per share computation: Numerator: Net income available to common stockholders $ 25,269 $ 38,122 Denominator: Weighted average common shares outstanding - basic 98,749,340 100,394,693 Basic earnings per share from net income $ 0.26 $ 0.38 Diluted earnings per share computation: Numerator: Net income available for common stockholders $ 25,269 $ 38,122 Numerator for diluted earnings per share $ 25,269 $ 38,122 Denominator: Weighted average common shares outstanding - basic 98,749,340 100,394,693 Employee stock options 210,380 910,180 Non-vested stock units 91,284 174,730 Weighted average common shares - diluted 99,051,004 101,479,603 Diluted earnings per share from net income $ 0.26 $ 0.38 15 Table of Contents Diluted earnings per share calculations for the thirteen weeks ended November 29, 2025, November 30, 2024, excluded 0.9 million and 0.7 million shares of common stock issuable upon exercise of stock options that would have been anti-dilutive. Diluted earnings per share calculations for the thirteen weeks ended November 29, 2025, and November 30, 2024, excluded 0.4 million and an immaterial number of non-vested stock units that would have been anti-dilutive. 12. Omnibus Incentive Plan Stock-based compensation includes stock options, restricted stock units, performance stock unit awards, and stock appreciation rights, which are awarded to employees, directors, and consultants of the Company. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period of the award based on their grant date fair value. Stock-based compensation expense is included within General and administrative expense, which is the same financial statement caption where recipient’s other compensation is reported. The Company recorded stock-based compensation expense of $ 3.1 million and $ 3.8 million in the thirteen weeks ended November 29, 2025, and November 30, 2024, respectively. Stock Options The following table summarizes stock option activity for the thirteen weeks ended November 29, 2025: Shares underlying options Weighted average exercise price Weighted average remaining contractual life (years) Outstanding as of August 30, 2025 1,476,243 $ 25.44 4.61 Granted — — Exercised ( 88,000 ) 12.00 Forfeited ( 928 ) 38.61 Outstanding as of November 29, 2025 1,387,315 $ 26.28 4.49 Vested and expected to vest as of November 29, 2025 1,387,315 $ 26.28 4.49 Exercisable as of November 29, 2025 1,197,402 $ 24.62 3.98 As of November 29, 2025, the Company had $ 0.8 million of total unrecognized compensation cost related to stock options that will be recognized over a weighted average period of 0.7 years. During the thirteen weeks ended November 29, 2025, and November 30, 2024, the Company received $ 1.1 million and $ 10.0 million in cash from stock option exercises, respectively. Restricted Stock Units The following table summarizes restricted stock unit activity for the thirteen weeks ended November 29, 2025: Units Weighted average grant-date fair value Non-vested as of August 30, 2025 639,015 $ 36.14 Granted 451,449 20.50 Vested ( 167,460 ) 36.22 Forfeited ( 14,715 ) 35.32 Non-vested as of November 29, 2025 908,289 $ 28.37 As of November 29, 2025, the Company had $ 20.5 million of total unrecognized compensation cost related to restricted stock units that will be recognized over a weighted average period of 2.2 years. Performance Stock Units During the thirteen weeks ended November 29, 2025, the Board of Directors granted performance stock units under the Company’s 2017 Omnibus Incentive Plan. The number of shares issuable as a result of grants of performance stock units is determined based on market-based criteria, performance-based criteria, or a combination of market-based criteria and performance-based criteria. The number of shares may be increased or decreased based on the results of these metrics in accordance with the terms established at the date of grant. 16 Table of Contents For market-based criteria awards, the Company’s relative total shareholder return, or relative TSR, is measured for the Company and each company in the Russell 3000 Food & Beverage index using the immediately preceding 30-day average share price at the beginning and end of the applicable three -year performance period. The percentile rank of the Company’s TSR relative to that of the peer group determines the percent of the target award earned, ranging between 0 % and 200 %. The related compensation expense is recognized ratably over the term regardless of whether or not the market condition is satisfied, provided the requisite service is rendered. These units are valued using a Monte Carlo simulation. For Company financial performance-based criteria awards, we estimate the probability that the Company’s internally established performance criteria will be achieved at each reporting period and adjust compensation expense accordingly. The performance metrics achieved determines the percent of the target award earned, ranging between 0% and 200%. These units are valued using the closing market price of the Company’s common stock on the date of grant. For market-based criteria and Company financial performance-based criteria awards, the Company’s TSR within the peer group and the performance metrics achieved determines the percent of the target award earned, ranging between 0% and 275%. We estimate the probability that the performance criteria will be achieved at each reporting period and adjust compensation expense accordingly. Should the performance-based criteria not be probable of being achieved, the compensation expense for the value of the award incorporating the market-based criteria is recognized ratably over the term, provided the requisite service is rendered. These units are valued using a Monte Carlo simulation. The following table summarizes performance stock unit activity for the thirteen weeks ended November 29, 2025: Units Weighted average grant-date fair value Non-vested as of August 30, 2025 278,193 $ 52.66 Granted 290,348 23.92 Vested ( 56,651 ) 62.55 Forfeited ( 17,977 ) 42.84 Non-vested as of November 29, 2025 493,913 $ 34.99 Performance stock units are generally granted to employees as a part of the annual grant in November of the associated fiscal year, although the Board of Directors reserves the right to administer mid-year grants from time to time as they see fit. The fair value of each performance stock unit grant with a market-based TSR component is estimated on the date of grant using a Monte-Carlo simulation based on the following assumptions presented below which are associated with each year’s annual grant: Thirteen Weeks Ended Thirteen Weeks Ended November 29, 2025 November 30, 2024 Expected volatility 29.96 % 31.38 % Expected dividend yield — % — % Expected performance term 2.93 2.93 Risk-free rate of return 3.54 % 4.14 % Fair value $ 22.22 $ 54.41 As of November 29, 2025, the Company had $ 10.0 million of total unrecognized compensation cost related to performance stock units that will be recognized over an expected weighted average period of 2.4 years. Stock Appreciation Rights Stock appreciation rights (“SARs”) permit the holder to participate in the appreciation of the Company’s common stock price and are awarded to non-employee consultants of the Company. The SARs settle in shares of its common stock once the applicable vesting criteria have been met. The SARs outstanding as of November 29, 2025, cliff vested two years from the date of grant and must be exercised within five years from the date of grant. 17 Table of Contents The following table summarizes SARs activity for the thirteen weeks ended November 29, 2025: Shares underlying SARs Weighted average exercise price Outstanding as of August 30, 2025 150,000 $ 37.67 Granted — — Exercised — — Forfeited — — Outstanding as of November 29, 2025 150,000 $ 37.67 Vested as of November 29, 2025 150,000 $ 37.67 Exercisable as of November 29, 2025 150,000 $ 37.67 The SARs outstanding as of the thirteen weeks ended November 29, 2025, are liability-classified; therefore, the related stock-based compensation expense is based on the vesting provisions and the fair value of the awards. 13. Segment Information The Company substantially completed its efforts to fully integrate its operations and organizational structure after the OWYN Acquisition. The Company aligned the nature of its production processes and methods used to distribute products to customers and its organizational structure to support entity-wide business functions across brands, products, customers, and geographic regions. As a result, as of the thirteen weeks ended November 29, 2025, the Company determined its operations are organized into one consolidated operating segment and reportable segment, represented by the Company’s consolidated financial statements. Previously, as of November 30, 2024, the Company’s operations were organized into two operating segments, Quest and Atkins, and OWYN, which were aggregated into one reportable segment due to similar financial, economic and operating characteristics. The Chief Operating Decision Maker (“CODM”) is the Chief Executive Officer (“CEO”). The CODM regularly reviews consolidated segment performance including net sales, significant expenses, net income, Adjusted EBITDA, budget to actual variance analysis, as well as other key metrics. The CODM uses net income as the measure of profitability to assess segment performance and allocate resources. The accounting policies of the segment are the same as those described in Note 2, Summary of Significant Accounting Policies. The following table summarizes our segment net sales, significant expenses, and net income for the thirteen weeks ended November 29, 2025, and November 30, 2024: Thirteen Weeks Ended November 29, 2025 November 30, 2024 Net sales $ 340,198 $ 341,268 Cost of goods sold 230,298 210,782 Operating expenses: Selling and marketing 29,677 32,994 General and administrative 38,006 38,064 Depreciation and amortization 4,633 4,160 Business transaction costs — 643 Other income (expense) ( 3,768 ) ( 6,950 ) Income tax expense 8,547 9,553 Net income $ 25,269 $ 38,122 18 Table of Contents