Total Revenue

-8% " " " " " "

The decline was driven by lower volumes in North America (due to share losses and soft restaurant traffic) and the carryover effect of exiting certain lower-margin business in Europe in prior quarters. While inflation-driven pricing helped offset part of the drop, net sales were still pressured by weaker demand and product mix shifts. " " " " " "

North America

-8% " "

A continued volume decline in the U.S. and Canada was amplified by customer share losses and muted restaurant traffic, building on trends observed in previous periods. Strategic decisions to focus on higher-margin channels further reduced sales volumes, despite some benefit from ongoing pricing actions. " "

International

-6% " "

Previous-quarter cuts to lower-priced contracts in Europe and the lingering impact of a voluntary product withdrawal constrained international volume. Growth in Latin America and Asia-Pacific only partially offset these headwinds, resulting in a net decline. " "

COGS

+5% " " " " " "

Input cost inflation (notably higher raw potato costs) and inefficiencies from underutilized production lines pushed up per-pound manufacturing expenses, continuing the trend from earlier quarters. Although supply chain productivity initiatives offered some relief, they did not fully offset these higher costs. " " " " " "

SG&A

>900% increase from $17M in Q2 2024 to $184.7M " " " " " "

This sharp jump reflects one-time costs (including higher IT investments and potential integration expenses) combined with the normalization of expenses from an unusually low base in the prior year. Additionally, unrealized mark-to-market currency and hedging losses contributed to the spike, building on cost pressures seen in previous quarters. " " " " " "

Operating Income

-94% " " " " " "

Lower gross profit from declining sales volumes and rising manufacturing costs, alongside pronounced SG&A increases, severely narrowed margins. Although pricing actions helped partially, they could not offset the combined impact of higher costs and volume losses, resulting in a steep drop in operating income. " " " " " "

Net Income

From $215M to - $36.1M " " " " " "

The swing to a net loss was primarily driven by substantially lower operating income and increased cost burdens, including one-time SG&A items. A higher effective tax rate and carryover effects of voluntary product withdrawal charges from previous periods also contributed to the negative bottom line. " " " " " "

Net Sales

FY 2025

no prior guidance

$6.35B to $6.45B "

no prior guidance

Adjusted EBITDA

FY 2025

no prior guidance

$1.17B to $1.21B "

no prior guidance

CapEx

FY 2025

$550 million "

$750 million "

raised

Net Sales

2H FY 2025

no prior guidance

$3.1B to $3.2B "

no prior guidance

Adjusted EBITDA

2H FY 2025

no prior guidance

$600 million to $640 million "

no prior guidance

EBITDA margins

Short to medium term

no prior guidance

19% to 20% " "

no prior guidance

Volume

FY 2025

no prior guidance

Expected to grow "

no prior guidance

Price/Mix

FY 2025

no prior guidance

Expected to decline "

no prior guidance

Persistent Softness in Restaurant Traffic

Q1 2025: Traffic down 2%, soft but slightly better than Q4 2024. " Q4 2024: Prolonged traffic softness with accelerating declines. " " Q3 2024: Soft traffic driving volume declines, uncertain recovery timeline. " " "

Fifth consecutive quarter of consumer traffic decline, especially in QSR; uncertain volume recovery " "

Recurring; sentiment still cautious, with incremental improvements and persistent headwinds

Market Share Dynamics

Q1 2025: Recovering lost share post-ERP issues, new chain wins in International. " " " Q4 2024: Share losses from executional challenges. " " Q3 2024: Lost share but working to regain via higher-margin products. " "

Incremental share losses in NA & International, slower-than-expected recovery; some new business wins " " " "

Recurring; company remains focused on regaining lost accounts and capturing new wins

Confidence in Long-Term Fry Category Growth

Q1 2025: Remains confident in global fry demand despite declining traffic. " Q4 2024: Expects return to historical growth as market adjusts. " " Q3 2024: Forecasting 2%-4% long-term growth. " " "

Reaffirmed long-term fry growth outlook despite short-term pressures, citing steady fry attachment rates "

Recurring; consistently bullish on category resilience

Operational Efficiencies & Cost Management

Q1 2025: Restructuring plan, plant closure, SG&A cuts, modernizing manufacturing footprint. " " " Q4 2024: Evaluating network for cost savings. " " " Q3 2024: ERP disruptions raised costs, margin pressures. " "

Addressing unplanned downtime, lower utilization, aiming for cost reductions; new supply chain leadership driving improvements " " " "

Recurring; gradual benefits expected as initiatives ramp up

Capacity Utilization & Production Adjustments

Q1 2025: Closed Connell facility (5% NA capacity), temporarily idled lines. " " Q4 2024: Managing new capacity to match soft demand. " " " Q3 2024: Concern over rising industry capacity amid soft traffic. "

Low 90% utilization; some line suspensions due to downtime, start-up issues at expansions " "

Recurring; ongoing right-sizing of production to align with demand

Share Repurchase & Capital Allocation

Q1 2025: Repurchased 1.4M shares ($82M); no new authorization details. " Q4 2024: $210M repurchased in FY2024, focus on strategic investments. " " Q3 2024: Ongoing buybacks and dividend returns. " " "

Authorized an additional $250M, total $560M for buybacks; dividend increase; shifting capex to modernization " "

Recurring; new repurchase authorization indicates continued focus on shareholder returns

ERP Transition Challenges

Q1 2025: Delayed future ERP phases, working to regain share lost in transition. " " " Q4 2024: Disruptions affecting order fulfillment and share. " " Q3 2024: $95M impact from ERP issues. " " "

Lingered in International; some customer recovery ongoing, incremental noncash ERP amortization " "

Recurring; impact diminishing but still a factor

International Expansion & M&A

Q1 2025: Growth in Asia Pacific & Latin America; new plant coming soon. " " Q4 2024: No specific mention. Q3 2024: Evaluating international M&A. " "

No mention in Q2 2025

Previously discussed; not addressed in current call

Pricing Actions & Margin Pressures

Q1 2025: Price/mix +2%, offset by higher manufacturing costs, more price investments ahead. " " " Q4 2024: Targeted price/trade support, margin below target. " " Q3 2024: Price up, offset by unfavorable mix. " " "

Price/mix down 3% in NA; EBITDA margin guided at 19%-20% due to competition, inflation " " "

Recurring; competition constraining pricing power and pressuring margins

Impact of Europe’s Potato Crop

Q1 2025: In line with historical averages, no major detail. " Q4 2024: Expecting below-average crop, driving higher costs. " " Q3 2024: Noted price up mid-single digits, more detail promised in Q4. "

Crop improved vs. initial low outlook, leading to competitive market and limited cost pass-through "

Ongoing; volatility in crop outlook influencing cost and competition

Lowered EBITDA Margin Guidance

Q1 2025: Targeting lower end of range after product withdrawal, cost deleveraging. " " " Q4 2024: Margin below target, product withdrawal impact, unfavorable mix. " " Q3 2024: Reduced annual guide from ERP disruptions. " "

Trimmed to 19%-20% near term, citing inefficiencies, competition, and cost inflation " "

Recurring; persistent caution on near-term profitability