Earnings call transcript: Simply Good Foods Q4 2025 sees stock plunge after EPS miss

Simply Good Foods Co. (SMPL) reported its fourth-quarter earnings for 2025, revealing a mixed financial performance that led to a significant pre-market stock decline. The company reported earnings per share (EPS) of $0.46, falling short of the expected $0.48, marking a negative surprise of 4.17%. Despite slightly surpassing revenue forecasts, the market reacted negatively, with shares dropping 19.43% in pre-market trading to $20.11. According to InvestingPro analysis, the stock appears undervalued at current levels, with a strong financial health score of 3.05 out of 5. The platform’s comprehensive analysis reveals 7 additional key insights about SMPL’s financial position.

Key Takeaways

• Simply Good Foods missed EPS expectations by 4.17%.
• Revenue slightly exceeded forecasts, reaching $369 million.
• The stock fell 19.43% pre-market following the earnings report.
• Quest brand showed strong growth, with a 15.9% increase in Q4.
• The company repurchased $51 million of stock during the quarter.

Company Performance

Simply Good Foods experienced a challenging quarter with a 1.8% year-over-year decline in net sales to $369 million. However, the company’s Quest brand continued to perform well, growing by 15.9% in the quarter. Despite these gains, the company’s gross profit decreased by 13.3% year-over-year, reflecting pressures on margins. The company maintains a moderate debt level with a debt-to-equity ratio of 0.17, as reported by InvestingPro, which provides detailed financial health metrics and valuation analysis in its comprehensive Pro Research Report.

Financial Highlights

• Revenue: $369 million, a decrease of 1.8% YoY
• EPS: $0.46, a decrease compared to the forecast of $0.48
• Gross margin: 34.3%, down 450 basis points
• Adjusted EBITDA: $66.2 million, down 14.5% YoY

Earnings vs. Forecast

The company reported an EPS of $0.46, missing the forecast of $0.48 by 4.17%. Revenue came in at $369 million, slightly above the forecast of $368.92 million, providing a marginal positive surprise of 0.02%.

Market Reaction

Simply Good Foods’ stock experienced a sharp decline of 19.43% in pre-market trading, falling to $20.11. This reaction reflects investor disappointment with the EPS miss and concerns over declining margins. The stock’s performance contrasts with its 52-week high of $40.53, indicating significant volatility.

Outlook & Guidance

Looking ahead, Simply Good Foods projects net sales growth between -2% and +2% for fiscal 2026, with gross margins expected to decline by 100-150 basis points. The company anticipates a stronger performance in the second half of the year, driven by increased marketing investments in its Quest and OWYN brands. Despite near-term challenges, analysts tracked by InvestingPro maintain a positive outlook, with price targets ranging from $27 to $43, suggesting potential upside from current levels. Subscribers can access detailed analyst forecasts and 8 additional ProTips about SMPL’s future prospects.

Executive Commentary

"Our vision is clear: to be the scaled leader in high protein, low sugar, and low carb food and beverage," stated Geoff Tanner, President and CEO. He emphasized the importance of building a fast-paced, agile culture to stay competitive in the evolving nutritional snacking market.

Risks and Challenges

• Margin pressure due to increased costs and competitive pricing.
• Potential impacts from the resolution of OWYN brand quality issues.
• Market saturation in the nutritional snacking category.
• Economic uncertainties affecting consumer spending.
• Execution risks associated with new product launches and marketing strategies.

Q&A

During the earnings call, analysts inquired about the OWYN product quality issues and the company’s strategy for managing pricing elasticity. Management also addressed the rationalization of the Atkins brand and plans to hedge cocoa costs to improve margins.

Full transcript - Simply Good Foods Co (SMPL) Q4 2025:

Operator: Greetings and welcome to The Simply Good Foods Company fiscal fourth quarter 2025 conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. It is now my pleasure to introduce your host, Joshua Levine, Vice President of Investor Relations. Thank you. You may begin.

Joshua Levine, Vice President of Investor Relations, Simply Good Foods Company: Thank you, Operator. Good morning and welcome to The Simply Good Foods Company’s fourth quarter and full fiscal year 2025 earnings call for the period ended August 30, 2025. Today, Geoff Tanner, President and CEO, and Chris Bealer, CFO, will provide you with an overview of our results, which were provided in our earnings release issued earlier this morning. Our prepared remarks will then be followed by a Q&A session. A copy of the release and accompanying presentation are available on the Investors section of the company’s website at simplygoodfoodscompany.com. This call is being webcast, and an archive of today’s remarks will be made available. During the course of today’s call, management will make forward-looking statements, which are subject to various risks and uncertainties that may cause actual results to differ materially. The company undertakes no obligation to update these statements based on subsequent events.

A detailed listing of such risks and uncertainties can be found in today’s press release and the company’s SEC filings. On today’s call, we will refer to certain non-GAAP financial measures that we believe provide useful information for investors. Due to the company’s asset-light, high cash flow business model, we evaluate our performance on an adjusted basis as it relates to EBITDA and diluted EPS. Please refer to today’s press release for reconciliation of our non-GAAP financial measures to their most comparable measures prepared in accordance with GAAP. The acquisition of Only What You Need, or OWYN, was completed on June 13, 2024. As we have now lapped the anniversary date of the OWYN acquisition, the use of organic refers to year-over-year growth for brands we have owned for more than 12 months on a comparable basis.

For Q4, organic growth includes year-over-year growth for Simply Good Foods’ business, excluding the period of time prior to the closing of the OWYN acquisition, as well as the impact of lapping the extra week in the fourth quarter of fiscal year 2024. Finally, all retail takeaway data included in our discussion today, unless otherwise noted, reflects a combination of Circana’s MULO++C measured channel data and company estimates for unmeasured channels for the 13 weeks ended August 31, 2025, as compared to the prior year. I will now turn the call over to Geoff Tanner, President and CEO.

Geoff Tanner, President and CEO, Simply Good Foods Company: Thank you, Josh. Good morning, everyone, and thank you for joining us. Fiscal year 2025 was a solid year for Simply Good Foods. We delivered 9% reported net sales growth, including 3% on an organic basis, and grew adjusted EBITDA by 3%. On a pro forma basis, including OWYN, but excluding the extra week from the prior year, net sales increased over 4% with adjusted EBITDA up approximately 6%. We largely completed the integration of OWYN, invested in our people and capabilities, and put our cash to work, paying off $150 million of debt and repurchasing more than $50 million of our stock. Our vision is clear: to be the scaled leader in high protein, low sugar, and low carb food and beverage. There is a generational shift towards these products that is quickly mainstreaming, one of the most impactful trends in food and beverage today.

This is best highlighted by the continued strength of the nutritional snacking category, our traditional aisle, which includes on-trend high protein performance nutrition, as well as adult nutrition and several other fast-growing subcategories. In aggregate, this broader category has grown at least high single digits for the past five years and grew plus 13% this year, reinforcing how relevant it is today and supporting studies that show more than 70% of Americans are actively seeking more protein and less sugar, as well as fewer carbs in their diets. In support of our vision, we have been on a journey to rapidly evolve our organization to win in this exciting and dynamic space. In the last couple of years, we have rapidly shifted our portfolio. Quest and OWYN now represent nearly three quarters of our net sales, with both growing double digits in fiscal year 2025.

Quest, which generated almost two thirds of the company’s net sales in Q4, is the category disruptor, flipping the macros on large mainstream snacking categories. Over the past two years, we have accelerated the pace of product innovation while broadening our reach, with marketing up about 50% since fiscal 2023 and household penetration now approaching 20%. Our recent acquisition of OWYN enhanced our presence in the fast-growing ready-to-drink shake segment, while positioning us to become a leader of the rapidly accelerating clean label movement. To support our fast-growing salty snacks business, we’re expanding capacity for the second time in two years, with construction on an additional production line now in progress. We increased our investment in innovation, strengthening R&D, and reducing time from concept to launch.

We invested in new sales talent and selling capabilities, expanding our opportunity to drive distribution both within and beyond our core aisle and to deepen penetration within channels. We ramped up productivity initiatives to combat inflation and free up funds to fuel our growth. Additionally, to compete and win in our space, we have consciously increased our organizational output across all facets of the company. We have challenged ourselves to reduce lead times in innovation and marketing, embrace agility in our supply chain, and evolve our marketing playbook to incorporate an insurgent mindset to compete against brands, large and small. The goal is an organization that combines the agility and speed of an insurgent challenger with the advantages of scaled R&D, supply chain, and selling capabilities. I am excited by the improvements we have made and how these actions position our company to win.

In the near term, however, we must address two important challenges. We understand the magnitude of each, have plans against both, and are confident we will work through these headwinds as we continue to evolve the company. First, as we’ve discussed in the past, Atkins is losing shelf space in the highly competitive nutritional snacking aisle. Over the last several years, as sales for this category doubled in size, with space at a premium, Atkins’ large distribution and merchandising footprint has come under pressure, with sales declines in recent periods, mainly driven by distribution cuts at several retailers, especially at Club and Mass. 75% of Atkins’ retail sales today come from approximately half of its SKUs, which turn in the top two quartiles of the category velocity rankings.

As we enter fiscal 2026, our tail SKUs that turn in the bottom of category velocity rankings have been trimmed back at some accounts. As we consider potential future distribution risk across our top accounts, it’s important to note that only approximately 10% to 15% of Atkins’ SKUs on average are still in the bottom quartile today. While painful in the short term, this process will better align Atkins’ shelf space with sales and support of a sustainable business powered by a strong core assortment. Encouragingly, at a large retailer, where we recently saw a double-digit decline in distribution, our average velocities are up nicely across the reset, giving us confidence we’re on the right track. To help strengthen the brand and attract new consumers, in September, we began to flow into market several initiatives.

These include new advertising that reorients Atkins from a more general lifestyle brand back towards weight management, as well as modernized packaging, innovation, and an updated website. We’ve also brought to market a smaller pack size within our bar portfolio, providing consumers a more attractive entry price point intended to stem declines in one of the more challenged parts of the business. Our strategy acknowledges the need to right-size Atkins’ space rather than trying to prop up our underperforming tail. A key component of this approach is proactively working with senior teams at our key retailers to manage our assortment and flow back to support the continued expansion and prioritization of Quest and OWYN. Again, while these decisions may be painful for the Atkins brand in the short term, we’re taking the right decisions and the right actions for the brand, the category, and for Simply Good Foods Company.

Our second major challenge is inflation. In order to ensure we had adequate supply to meet consumer demand, we contracted for cocoa at historically high prices, which, in addition to tariffs, weighed heavily on our margins in the back half of fiscal 2025. This pressure will continue in the first half of fiscal year 2026. At this point, we’re confident our gross margins will improve, beginning modestly in Q3 and more meaningfully into Q4, driven in part by the coverage we’ve already secured on cocoa through most of the second half at rates well below prior year. We continue to monitor the markets and note that current spot levels present further potential favorability as we exit this year and primarily into fiscal 2027.

In addition, we’ve also responded to inflation with aggressive productivity actions and pricing, which we announced to the trade in August and which will be in market by the end of Q1 of fiscal 2026. I’m pleased with the significant progress our teams have made on productivity, a capability that we’ve significantly expanded over the past two years, with benefits that will flow into our margins in the second half of fiscal 2026 and into 2027. Looking ahead, we’re in a strong position. We operate in an on-trend, high-growth category, benefiting from a generational shift towards high-protein, low-sugar, low-carb products. We will lead this shift and create value for our shareholders by accelerating innovation, expanding physical availability of our products, and breakthrough marketing.

Our world-class R&D team, asset-light model, category leadership role with retailers, and enhanced selling capabilities give us a competitive edge, and our strong balance sheet provides optionality for M&A. Turning to Quest, which represented almost two-thirds of our net sales in Q4, Quest delivered year-over-year consumption growth of 11% in the quarter and expanded household penetration to 19%, up 170 basis points versus prior year. For fiscal year 2025, Quest grew consumption 12% and net sales over 13% on a 52-week basis, helping to deliver a five-year CAGR of nearly 20% under our ownership. As the brand approaches $1 billion in net sales, we’re very pleased with its performance, and we remain confident in our ability to continue to disrupt the nutritional macros across many categories.

Credit goes to the Quest team, a nimble and competitive culture, and a framework for growth based on disruptive innovation, expanding physical availability, and increasing brand awareness. Our Quest salty snacks portfolio continues to outperform, with consumption up 31% for the quarter and 34% for the full year. From representing 20% of Quest retail sales three years ago, Salty is on target to be our largest platform by the end of fiscal year 2026. The size of the addressable market is large. We have a rich pipeline of innovation. We continue to gain shelf and merchandising space in and outside our aisle. As mentioned, we’ve invested to expand capacity. Our Quest bar business grew 2% in Q4 and for the full year, driven by our Hero line and our new Overload Bar platform.

If you recall, our Hero, or chocolate-covered crispy line of bars, and our recently launched Overload Bars with delicious inclusion-heavy offerings are part of the wave of more indulgent protein bars. These products amp up taste and texture while delivering the nutritional macros consumers are looking for. While we’re moving in the right direction on bars, our goal is to further accelerate our growth in the space. Over the past 18 months, we’ve built an impressive pipeline of exciting new bar forms, flavors, and textures that we’ll bring to market in the coming years. Our Quest Bake Shop platform continues to perform, and I’m excited for the launch of our first Bake Shop line extension, a great tasting high protein donut expected to hit shelves during Q1 of fiscal 2026.

We’re also encouraged by the early performance of our new ready-to-drink milkshake platform, which is disrupting the category in a way only Quest can, with leading macros and great taste. With strong commercial execution and more platform expansion to come in the spring, we’re confident we can win in the fast-growing competitive ready-to-drink category. Lastly, we’re thrilled with the recent launch of the second generation of our It’s Basically Cheating advertising campaign. The campaign of humorous ads highlights how Quest uniquely enables consumers to succumb to their food desires by resolving the inherent tension between food that tastes great and food with good nutrition. Ads have already begun on Thursday Night Football and will continue to be featured across a range of digital, social, and other media properties throughout the year. Quest is our largest and highest margin brand and the innovation leader in the category.

As we rapidly evolve our organization, Quest will be at the forefront, continuing to deliver strong growth. Moving to Atkins, fiscal year 2025 was a challenging year. Consumption declined 12% for Q4 and 10% for the full year, largely driven by losing distribution at Club and not repeating certain high volume, low ROI merchandising events, principally in Mass. Challenges continue to be concentrated primarily in bars and confections, whereas shakes were down 4% in the quarter and only 2% for the full year, supported by the success of the 30 gram Atkins Strong ready-to-drink shakes we launched a year ago. In the e-commerce channel, where space is not a constraint, we continue to drive solid growth with a key partner up mid-single digits.

As mentioned, as we evolve our company, Atkins will be a more focused brand around a core assortment, and we are being proactive in our efforts to get there. We acknowledge that there will continue to be short-term pain for Atkins, with consumption expected to decline approximately 20% in fiscal year 2026. Consumer research continues to show that Atkins’ core strength lies in its scientific credibility and proven history of helping consumers achieve their weight loss or maintenance goals. In short, Atkins works. This gives us confidence that even as we are partnering with key retailers to repurpose Atkins’ space to accelerate growth for Quest and OWYN, we’re making the right investments and taking the correct action to stabilize and ultimately support the long-term sustainability and profitability of the brand.

Turning to OWYN, consumption grew 14% in the fourth quarter and 34% for the full year, with household penetration up 100 basis points to 4.2%. Double-digit RTD retail sales benefited from new distribution gains at a key Mass customer and a test at Club. I want to address the somewhat slower consumption growth we’ve observed over the last few months. The impact of lapping distribution, which I’ve discussed before, was exacerbated by a product quality issue related to a raw material sourcing decision for pea protein made prior to the closing of the acquisition. Specifically, this pea protein, which was used in a portion of production during Q2, resulted in taste and texture issues on certain lots as the product aged. While the affected product made up only a small minority, I want to be clear that it was 100% safe and met all of our allergen testing protocols.

However, the product experience was poor and showed up in ratings and reviews. Therefore, as we ramped distribution and trial coming into Q4, our consumer response was not as robust as we would have liked, and as a result, velocity slowed. We have already mitigated the issue and begun aggressive programming in trade and customer marketing aimed at re-accelerating trial and growth rates. In spite of the challenge, OWYN still grew double digits in Q4, which is a testament to the unique positioning and strength of the brand. Early on here in Q1, OWYN sustained a mid-teens growth rate in September, even as it lapped a big event at Club last year. With the integration largely completed, we will now leverage the full scale and capabilities of Simply Good Foods Company to drive growth of the business.

In fiscal year 2026, this will include significantly stepped up trade and marketing investments I spoke about, in addition to leveraging our retail teams to drive displays, close distribution gaps, and bring highly differentiated innovation to market. In addition to shakes, powders also represent a huge opportunity for us, at 12% of the brand’s mix today, growing significantly. OWYN’s mission is to forge a new standard of clean. Its products are free from the top nine allergens and have a cleaner and simpler list of ingredients. Simply put, OWYN is built for today’s evolving consumer preferences. Recently completed research shows OWYN has leading equities in clean, plant-based nutrition. Aided awareness is low at 20%, reflecting significant headroom with ACV for shakes in the mid-60% and only 26% for powders. This is why we must invest more to drive awareness and build household penetration.

We’re only scratching the surface for what this brand can be, and we’re fully committed to unleash its full potential. To summarize, fiscal year 2025 was a solid year, but much work remains to evolve the company to win in this exciting category. I acknowledge our guidance for fiscal 2026 is below our long-term algorithm, and we are committed and confident we’re making the right investments and taking the right actions in fiscal 2026 to set up fiscal 2027 for success. Approximately three quarters of our portfolio through Quest and OWYN is driving strong top and bottom line growth. We’re building a fast-paced, agile culture backed with world-class capabilities necessary to win in this category. With Quest and OWYN driving growth, Atkins being reshaped for the future, and productivity and pricing initiatives underway, we’re confident in our ability to deliver sustained growth and value creation for years to come.

I’ll now hand the call over to Chris, who will provide you with details of our financial results and outlook.

Chris Bealer, CFO, Simply Good Foods Company: Thank you, Geoff. Good morning, everyone. Overall, our fiscal year finished generally in line with our guidance, with some modestly higher costs impacting our margins as we exited the year. Organic net sales grew at least 3% in each of the last three quarters. We continue to invest in our brand, our talent, and our capabilities to position the company for the long term, and we generated a lot of cash that we put to work. We are operating from a position of strength as we exit fiscal 2025 and assess the challenges facing us in fiscal 2026. I will now discuss our financial results. For net sales, total Simply Good Foods’ fourth quarter reported net sales of $369 million, declined 1.8% versus last year.

Excluding the small contribution from OWYN prior to the anniversary date of the acquisition’s closing, as well as the lap of the 53rd week, organic net sales grew 3.5%. The key driver of this organic growth was Quest, which grew 15.9% primarily from strong performance in our salty snacks business, while Atkins declined 18.3% as a result of distribution losses and related trade inventory reductions. Gross profit of $126.6 million declined 13.3% on a reported basis from the year-ago period, driven mainly by lapping the 53rd week and elevated inflationary costs, most notably cocoa. Gross margin was 34.3%, a decline of 450 basis points versus prior year on a GAAP basis, largely reflecting higher input costs and the initial impact of tariffs that were only partially offset by productivity and pricing.

Excluding the inventory step-up related to the acquisition of OWYN, which was a 90 basis points headwind to gross margins in the fourth quarter of last year, gross margins declined 540 basis points. Selling and marketing expenses of $32.4 million were down 20.6% versus prior year, primarily the result of a planned pullback in Atkins marketing and lapping the 53rd week. G&A expenses of $40.6 million declined 1.6%, primarily due to lapping the 53rd week that was mostly offset by OWYN integration expenses. Excluding stock-based compensation and one-time integration and other costs, G&A declined 16.6% to $27.6 million, driven by lapping the 53rd week and the initial realization of cost synergies related to the OWYN acquisition. As a result, adjusted EBITDA was $66.2 million, down 14.5% from the year-ago period. Excluding the lap of the 53rd week, adjusted EBITDA declined in the high single-digit range.

During the fourth quarter, we determined that there were indicators of impairment related to the Atkins brand and related intangible assets. After conducting a quantitative impairment assessment, we recorded a non-cash loss on impairment of $60.9 million. The impairment is the result of Atkins’ performance in fiscal year 2025 and updated projections of future revenue. Net interest expense of $3.6 million was down $4.3 million versus the prior year as a result of lower debt balances, while the effective tax rate was 20.2%. Net loss was $12.4 million, down from the net income of $29.3 million last year, due primarily to the impairment charge I just mentioned. On a full-year basis, reported net sales grew 9%, mainly driven by the OWYN acquisition, which added nearly eight points of growth, partially offset by approximately 2% impact from lapping the 53rd week.

On an organic basis, net sales increased 3%, driven by Quest, which grew 13.4%, as well as a small contribution from OWYN in Q4. Atkins was down 12.9%. Gross profit grew 2.8% year-over-year on a reported basis, driven by net sales growth that was partially offset by inflation, while gross margins for the full year declined 220 basis points as a result of elevated input costs, as well as dilution from the OWYN acquisition. Finally, adjusted EBITDA grew 3.4%, driven primarily by net sales growth, while reported net income declined largely as a result of the loss on impairment and other significant one-time costs, primarily related to the OWYN acquisition. Fourth quarter diluted loss per share was $0.12 versus earnings per share of $0.29 in the year-ago period, driven primarily by the impairment charge I mentioned a moment ago, which was a $0.45 after-tax headwind in the quarter.

Q4 adjusted diluted earnings per share was $0.46 compared to $0.50 in the year-ago period. On a full-year basis, the company generated diluted EPS of $1.02, a decline of 26.1% versus the prior year, largely due to the aforementioned impairment charge and one-time integration costs. Adjusted diluted EPS of $1.92 increased 4.9% versus the comparable prior year period. Please note that we calculate adjusted diluted EPS as adjusted EBITDA, less interest income, interest expense, and income taxes divided by diluted shares outstanding. Moving to the balance sheet and cash flow, as of the end of Q4, the company had cash of $98 million and an outstanding principal balance on its term loan of $250 million, bringing our net debt to trailing 12-month adjusted EBITDA to approximately 0.5 times. Full-year cash flow from operations was $178 million compared to approximately $216 million last year.

The decline was primarily due to higher uses of working capital. Capital expenditures finished the year at approximately $20 million, reflecting the timing of initial payments related to the strategic investment we’re making to support additional capacity. I will discuss this in more detail in a moment. For fiscal year 2025, the company repaid a total of $150 million of its term loan debt, bringing total repayments since the OWYN acquisition to $240 million, or essentially all of the $250 million borrowed to fund the purchase. We remain very comfortable with our gross debt levels today. In addition, during the quarter, the company used approximately $27 million to repurchase nearly 900,000 shares. For the full year, the company used approximately $51 million to repurchase nearly 1.6 million shares, or almost 2% of our outstanding common stock.

Finally, as detailed in this morning’s press release and to reflect management’s and the board’s continued confidence in the business, the board of directors recently approved a $150 million increase to the company’s existing stock repurchase program. As of October 23, 2025, the company has approximately $171 million remaining under its revised stock repurchase authorization. Moving on to a discussion of our outlook. Since we last spoke with you in July, here is what has changed. First, as a result of the accelerating pressures from inflation and tariffs, we announced the targeted pricing actions that will be in market by the end of Q1 and are expected to be a low single-digit benefit once fully implemented. These actions cover all three brands and will help us restore our margins, but in the near term, will cause our top-line trends to be more subdued as a result of initial elasticity.

Second, near-term growth slowed for OWYN as a result of the identified quality issue, which will also require incremental trade and brand investment to re-accelerate growth. Third, the impacts from tariffs are now generally more certain, apart from any changes in the prevailing tariff rates for Chinese imports, considering the ongoing negotiations where timing and magnitude remains uncertain. Assuming no significant change in prevailing tariff rates on China, we estimate our total tariff exposure will be less than 2% of our fiscal 2026 cost of goods sold on a net basis, including the benefit of currently identified mitigants against which we are already taking action. Given the trade agreements announced to date, the blended tariff rates will come in slightly higher than we were previously expecting.

Fourth, we have a secured coverage on cocoa supply that, as we move through the second half of fiscal 2026, will be progressively at prices below prior year, giving us good visibility on cost and margin improvement as we move through fiscal 2026 and into 2027. We continue to diligently monitor the commodity markets with the opportunity to further lock in more favorable costs and ensure supply. Finally, while not a change, I want to point out that we remain committed to investing in our growth platforms for the long term, even while we face higher inflation, especially in the first half. Therefore, for fiscal year 2026, we expect the following. Net sales growth is expected to be in the range of -2% to +2%, with growth from Quest and OWYN offset by Atkins.

Gross margins are expected to decline in the range of 100 to 150 basis points, and adjusted EBITDA year-over-year is expected to be in the range of -4% to +1%. This includes increased marketing spend on Quest and OWYN to support growth, while focusing on profitability for Atkins. Management is focused on long-term growth for the total company and will look to provide more fuel should it find the opportunity to do so. As we look at the shape of fiscal year 2026, the year will be a tale of two halves, with the second half expected to be stronger on both the top and bottom line than our first half. Starting with net sales, we expect growth in the first half to be at or below the lower end of our full-year range, with Q2 likely to be our weakest quarter of the year.

The first half will be impacted by initial elasticities related to our recently announced pricing actions and the wrap-around drag from Atkins’ distribution losses. While we will see the underlying benefit of recent distribution gains on Quest and OWYN, growth will be muted by the lingering effects from the OWYN quality issue and a generally tough lap for Quest and OWYN, both of which benefited in the prior year from strong merchandising programs, particularly in Q2. By the second half, we expect trends to improve meaningfully, driven by an exciting slate of innovation launches across our brands, normalizing elasticities, lapping the initial impacts from OWYN’s product issues, and tailwinds from distribution. Therefore, we expect net sales growth in the second half of the year to be at the higher end of our full-year outlook range.

Moving down the P&L, the shape of the year will be even more pronounced, driven by elevated inflation and tariffs impacting our margins in the first half before we benefit from the combination of lower cocoa costs, building productivity, and realized pricing in the second half. This lag will be most acute in Q1, when we will have very little benefit from pricing and productivity to help offset the higher costs, including the historically high cocoa inflation and our first full quarter of tariffs. As a result, we expect Q1 gross margins around 32.5%, representing a year-over-year decline of nearly 600 basis points.

Beginning in Q2, we expect to deliver sequential improvement in year-over-year trends for gross margin, and by the second half, we expect our gross margins to be in line or slightly better than our full-year fiscal 2025 gross margins on a GAAP basis, implying gross margin expansion in Q4 of nearly 200 basis points year-over-year. Adjusted EBITDA should generally track the shape of our expectations for gross margins, with pressures in the first half and much stronger results by the second half. Specifically, we expect first quarter adjusted EBITDA to decline by approximately 25% year-over-year. By Q2, we would expect more subdued year-over-year declines in the high single-digit range before we return to growth in the second half. Similar to gross margins, we expect the fourth quarter to be our strongest period of growth, up double digits year-over-year.

I would note that our outlook assumes current economic conditions, consumer purchasing behavior, and prevailing tariff rates will generally remain consistent across the company’s fiscal year. While our outlook includes a number of important assumptions, there remain several uncertain swing factors outside of our control that could represent risk to our outlook. Before we open up the call for questions, I wanted to finish by explaining our plans to spend $30 to $40 million on CapEx in fiscal 2026. Nearly all of this investment will be to support growth in our most attractive areas and particularly to reinforce our competitive moat in our salty business. We have been very clear that there is a big opportunity to drive continued expansion in our salty platform. Consumers love the products, and retailers are leaning in with us.

The investment in incremental and more flexible capacity enables us to support our long-term growth aspirations on the business and has an attractive payback. Strong cash flow generation is a hallmark of this company, and next year will be no different. Our low debt levels and high cash conversion rate provide us the optionality to create meaningful long-term value for our shareholders in multiple ways, including by investing in capacity, through share buybacks, and via M&A. For a comprehensive summary of our full-year outlook, please see slide 17 in our presentation. I want to commend our team for their hard work and tenacity to deliver the year and thank them for their support and collaboration in my first quarter as CFO. That concludes our prepared remarks. Thank you for your interest in our company. We are now available to take your questions.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. As a reminder to allow time for everyone to ask a question, we ask that everyone in the queue provide only one question. Our first question comes from the line of Peter K. Grom with UBS Investment Bank. Please proceed with your question.

Analyst: Thank you, Operator, and good morning, Geoff, Chris, Josh. I hope you all are doing well. I wanted to just pick up on the comments around OWYN and kind of the product quality issues that you alluded to that impacted the quarter. Geoff, it sounds like these are now kind of in the rearview here. Just curious how you think about the path from here, maybe what you’ve seen more recently from the brand. I guess just related, when you think about the full-year sales guidance, what’s the range of outcomes as it relates to OWYN based on what we know today? Thanks.

Geoff Tanner, President and CEO, Simply Good Foods Company: Yeah, I appreciate the questions. As we said on the call, our guidance for the year had always expected Q4 to slow a bit as we were lapping known distribution wins. However, as mentioned, Q4 was impacted by a product quality issue related to the raw material sourcing for pea protein, a decision that was made prior to closing the acquisition. More specifically, the pea protein was used in production during Q2, which did impact taste and texture on certain lots as the product aged. Used in our estimate around 10%, but certainly material enough to impact consumption, and we certainly saw it come through in ratings and reviews. As soon as we saw it, we jumped on it. I will say the product is 100% safe within the OWYN allergen-free guidelines.

A small portion of the product was impacted, but enough to impact consumption and show up in ratings and reviews. What did we do about it? We have rectified the issue. We’ve got a newer and more stable formulation that is shipping, been shipping since August, will be fully in market by fiscal Q2. Obviously, we work with customers that were more disproportionately impacted. We increased trade to restart trials, and we’ve increased marketing as part of that. We’ve dealt with the issue. It’s mostly in the rear vision mirror. There’s probably a little bit of product out there, which is why we’re ramping up our investments in both trade and marketing. We continue to be extremely confident about the trajectory of this business. Strategically, it’s expanded our presence in the shake category. It reaches a new consumer, namely those looking for plant, clean label.

Feedback from retailers is that this is a very distinct incremental segment. The integration has gone well. The synergies are on track. This was this product issue. We’ve jumped on it. We’ve dealt with it. As you look forward, I could not be more excited about the OWYN brand. It’s the clear leader in clean. As we said today, even versus where we were when we completed the acquisition, you’re seeing the increasing emergence of clean and consumers looking for clean options. We certainly hear that from retailers. We see distribution upside on the core business. ACV is still low. As you look at brand awareness, it’s only aided awareness around 20%. That’s why we’re significantly increasing marketing. This is not just on the core shakes business. I think, as we mentioned on the call, the powders business is a smallish portion today, but that’s extremely high growth, very incremental.

One of the things we did right at close of acquisition is we integrated the R&D teams. We’ve been working, you should assume we’ve been working on some exciting platform innovation that we’ll build from there. We saw the product issue. It impacted consumption. We jumped on it. We’ve addressed it. One of the reasons for increased investment is just to really get that trial accelerated. Confident in the near term, confident in the long term. We’re very pleased with how we acquired this business.

Operator: Thank you. Our next question comes from the line of Steve Powers with Deutsche Bank. Please proceed with your question.

Great. Good morning, guys.

Morning.

Morning. Geoff, maybe picking up on where you started the conversation, just on the low sugar, high protein macro trends, assuming it’s as strong and enduring a structural shift as you discussed in your opening, and I think there are a lot of reasons to believe it is. I guess, how do you handicap future competition? Maybe how have those views changed since you first arrived at Simply Good Foods Company? Maybe a bit more detail how you’ve incorporated those allowances and forecasts into your business planning for fiscal 2026. If I could also, Chris, just picking up on where you wrapped up on cap allocation, just given the dynamics that the business is contending with organically this year, both top line and cost-related, as well as a decision to lean into CapEx a bit more to drive capacity.

I was curious to see if there’s any shift in your appetite or capacity to handle M&A. It didn’t sound like it from your comments, but I just wanted to clarify that. Thank you.

Geoff Tanner, President and CEO, Simply Good Foods Company: Yeah, I’ll start, Steve. To your question on category and competition, look, this is a fantastic category, especially versus Santa’s Store. We’re seeing now five years of high single or low double-digit growth. Category grew 13% in fiscal 2025, and most of that was volume. To your point on competition, it’s not a surprise to us that it’s a very competitive space, particularly with those growth rates. What I will say is competition is not new to us. It’s not a new dynamic for Simply Good Foods. This category has always had a pretty high level of competition. We’ve always been able to do well. It’s the reason why we’ve invested so heavily in R&D, more recently bolstered our sales capabilities with category cap and at retailers. We’ve got a very agile and robust supply chain. I think M&A capabilities and the success we’ve had play a role there.

As you think about the market, what I would point out is one of the dimensions, Steve, is that if the category is mainstreaming, it’s not just limited anymore to the poor traditional aisle. As that category mainstreams, the addressable market for us is increasing substantially, which is why we’re putting much more emphasis on getting out of our aisle. You can see that with chips, the displays we’re getting, merchandising, placement, secondary placement. You can see that with the kind of products we’re bringing to market, more mainstream products like chips, like baked, like milkshake. Competition is a dynamic. It’s something we’ve always dealt with. What I would say, then I hand it over to Chris, is one of the things I’ve tried to do at Simply Good Foods is to up our beats per minute, our output, to better handle competition than we have in the past.

That’s a more agile organization. Everything needs to be faster. Innovation needs to be faster to market. Our marketing, more digital, more always on. The decision-making that we’re in the organization needs to be quicker. This is something that we continue to work on as an organization as we face up to large-scale competitors and insurgent brands. It has to be part of the DNA of Simply Good Foods. We’re committed to being an organization that combines the best of a scaled organization with the mindset and agility of an insurgent operator. I’ll turn it over to Chris for the second part.

Chris Bealer, CFO, Simply Good Foods Company: Thanks for the question. Just to set the table a bit, in 2025, just to remind you, we generated around $180 million of cash from operations. We spent about $20 million in CapEx. We paid off $150 million in debt, and we bought back just over $50 million in shares. As we look at that, this business continues to generate a lot of cash. We’re starting out 2026 with a very low net debt level, and we’re very comfortable with our debt levels. As we look at cash priorities, we’re constantly evolving the best use of excess cash through a very structured framework. I would say our priorities have not changed. I would say that we look at these options really as an and and not an or. We believe we can buy back shares. We believe we can invest in capital.

We believe that if the right M&A opportunity comes along, we certainly have capacity to take that on. We do look at M&A really through a constant lens. In the short term today, we look at our stock. We believe it’s attractively valued, and we do think buyback represents a good opportunity for us to create long-term value.

Geoff Tanner, President and CEO, Simply Good Foods Company: Just to build on that with me from a CapEx perspective. As you think about our supply chain, Steve, you know, we have an agile supply chain built to follow the consumer, which is a real asset for us. That is part of our operating model. However, where we see an opportunity to invest to strengthen a competitive moat, we will, which we’ve seen on chips. It’s obviously the fastest growing part of our portfolio. In that instance, we’re willing to invest capital in partnership with a key strategic co-man to strengthen our competitive moat.

Operator: Thank you. Our next question comes from the line of Robert Moskow with TD Cowen. Please proceed with your question.

Hi. Thanks for the question. I just want to make sure I’m getting my math right because the top-line guidance was the thing that I think surprised us, being lower and zero at the midpoint. The Atkins decline was not the surprise, though. Given that I think Quest exited the year at 14% organic growth, and I think you even said that despite the problems on OWYN, you were also double-digit there. Just mathematically, it looks like these two are going to be up high single digit in fiscal 2026. I just want to make sure I got that math right. If so, are you forecasting a deceleration in Quest in 2026? Is that also part of the guide along with OWYN’s issues? Thanks.

Chris Bealer, CFO, Simply Good Foods Company: Yeah. I think you got the math roughly right. We’re looking at Quest up really high single digits. OWYN will be in the double-digit range. As we talked about on the call, Atkins is going to be down in consumption about 20%. I think a couple of factors that perhaps will explain it. As we said on the call, we have a price increase that we’ve announced to trade. It’s not in market yet, so it won’t be showing up in consumption numbers yet. We do have a price elasticity effect that’ll be heaviest in the first half. We’re also assuming Atkins trade inventories will come down, driven by the distribution losses, which also helps explain a little bit the consumption versus net sales guidance.

From a Quest perspective and OWYN perspective, as you look at the first half, they have some tough laps, which we will have to work through, which is also why half one is a little bit lower perhaps than the full year.

Geoff Tanner, President and CEO, Simply Good Foods Company: Thank you.

Operator: Thank you. Our next question comes from the line of Jon Robert Andersen with William Blair & Company L.L.C. Please proceed with your question.

Hi. Thanks for the question. I’ve got several, but I’ll just hone in on this, maybe big picture. Geoff, you mentioned earlier that, and we’re seeing this obviously too, the category is mainstreaming to some extent. As you pointed out, not necessarily constrained to the traditional aisle anymore as a result. I guess my question is if kind of the incremental household or incremental consumer for these types of products may not be in that traditional aisle, maybe more in a mainline aisle, how are you kind of approaching serving that customer, getting in front of that customer, interrupting that path to purchase? What kind of capabilities are you building if you invest in? How do you see the offering evolving and maybe moving around the store? Thank you.

Geoff Tanner, President and CEO, Simply Good Foods Company: Yeah, it’s a good question. You know, we certainly see it if you just look at the increase in household penetration that Quest has experienced and OWYN has experienced. Quest up 19% and OWYN up close to a point. You’re right. As the category has mainstreamed, as more and more consumers are looking for high protein, low carb, low sugar options, they’re looking for those options everywhere they shop. This is no longer just isolated to the more traditional aisle near the pharmacy. In my opinion, this is one of the biggest trends that is shaping this category, the mainstreaming of it. That is why we, over the last year in particular, have had a focused effort on expanding the physical availability of our products outside our aisle. You will see secondary placement in mainline aisles, for example, chips.

We’ve built a new retail team that is focused on driving displays across the store. We have made progress in new channels, particularly in the club space. We’ve invested in away from home, so I think universities, gyms, and airports. What I would say is we’re still in the early innings of that. That is one of the biggest growth vectors that we are focused against right now, and we’ve built the capabilities to do that. The second piece to that is continuing to bring products that are more mainstream, not just limiting our innovation to bars and shakes. We’ve seen that with Quest chips, and we are in the early innings of Quest chips. You’ve seen that with our bake shop launch, which has proven to be highly incremental.

You know, thinking more broadly with innovation and really tapping into what I think is possibly the greatest strength we have in our organization, which is our R&D team, and disrupting the macros of large snacking categories. This is all in support of mainstreaming, being available everywhere consumers shop and are looking for our products, and offering them a broader range of products that flip the macros on large unhealthy snacking categories.

Operator: Thank you. Our next question comes from the line of Megan Clapp with Morgan Stanley. Please proceed with your question.

Hi. Good morning. Thanks for all the detail. I wanted to ask about Atkins, Geoff. I think you mentioned at this point 75% of the brand sales come from SKUs in the top two quartiles of category velocity. Are you able to just tell us, are those SKUs growing at this point? I’m just trying to kind of square with the 20% decline you’re expecting this year. Is that concentrated in kind of the lower velocity SKUs, or are you still seeing some pressure within the core? How should we think about that 10 to 15% in the bottom quartile? Is the bulk of the rationalization you think, as we get through 2026, going to be behind you? Thank you.

Geoff Tanner, President and CEO, Simply Good Foods Company: Yes, by far the majority of the SKUs in the top two quartiles that represent 75% of sales are growing and healthy. The issue with Atkins, as we’ve talked about in the past and on the call today, is it’s had a long tail of SKUs that have underperformed. The declines that have impacted Atkins have been mostly driven by what you’re seeing in the tail SKUs. If you want to zero in on that 10% to 15% in the bottom quartile of the category, that’s where we’re focused. That’s where we’re focused on rationalizing that tail and working with retailers to drive to a more optimal assortment and more sustainable assortment concentrated around the core.

Okay, that’s helpful. Thank you.

Operator: Thank you. Our next question comes from the line of Brian Patrick Holland with D.A. Davidson & Co. Please proceed with your question.

Thanks. Good morning. I wanted to ask about the selling and marketing line, which, you know, if we go back, depending on what starting point you want to use, it’s come down about 300, 400 basis points as a % of sales. This obviously dates back to, you know, when Atkins was the only asset in the portfolio. You talked this morning about leaning into the OWYN brand despite the fact that you have margin pressures elsewhere. You’re taking an incremental hit to support that brand. You’ve had pretty clear success since you rolled out copy on Quest. You have some proof of concept there back in early 2024. Obviously, Atkins maybe is in a different place than it was, you know, if we go back, you know, five or six years as far as what it requires from a support level.

Again, just thinking about where that number’s come down and thinking about modeling this business going forward and the earnings power, just wondering what the right level of brand support for this portfolio requires. Thanks.

Geoff Tanner, President and CEO, Simply Good Foods Company: Yeah, I’ll take it and turn it over to Chris. We’ve been really pleased with the impact that advertising has had on Quest. Over the last couple of years, Quest is up substantially, up to double digit in dollars. The new campaign that we rolled out just over a year ago had an almost immediate impact on consumption. You could see it. I’ve been doing this for 25 years, and it’s very rare to see such an immediate impact of advertising on the business. Geoff rolled out, released a 2.0 version of It’s Basically Cheating, and the test scores there were terrific. Advertising works for us, and it works in this space. As you think about how we’re allocating our marketing spend, Quest up double digits, significant advertising to support that business.

As we look at the trajectory we see on OWYN and the future we see on OWYN and the customer conversations with OWYN, we think the right decision for us is to make a substantial increase in marketing on that business for the long term. You’re right, where we have rationalized advertising is on Atkins, as we’ve brought spending back in line with the size of that business and with the trajectory of that business. One more point on advertising, shifting more and more to digital, social media winning with influencers, retail media outlets. There’s also a mixed shift within our marketing spend.

Chris Bealer, CFO, Simply Good Foods Company: The only thing I’d really add to Geoff Tanner’s comments is, as we find opportunities through the year to invest more in marketing, we absolutely will. That’s definitely a priority for us to set ourselves up well for future continued sustained growth.

Operator: Thank you. Our next question comes from the line of Kaumil S. Gajrawala with Jefferies LLC. Please proceed with your question.

Hey, guys. Good morning. I wanted to dig into something that you talked about related to the OWYN product issue. I don’t know if you said if it was reviews or if it was something on social, but maybe if you could just talk a little bit about how you might be addressing OWYN from a brand issue. You know, maybe the product quality issues are resolved, but what impact did it have on the brand? You’ve talked a lot about sort of incremental marketing, but you know, maybe what specifically are you doing and perhaps what is the narrative or has the narrative been impacted in any way from this issue? Thanks.

Geoff Tanner, President and CEO, Simply Good Foods Company: Let me just reinforce that the product issue is largely behind us. We’ve been shipping new, more stable products since August, and the impact was less than 10% of product. That notwithstanding, it did have an impact on consumption and ratings and reviews, which did drop. The product in market was a little more concentrated in a few channels. We’ve overinvested in those channels to get the ratings back up to drive trial. I’m confident that this business will be very quickly back to where it was. To underscore that, even with the issue in market, the brand is growing mid-teens. As you look long term, again, we have tremendous confidence in this business. The clean movement is really accelerating. We’re hearing it from retailers. We’re planning on making significant investments in marketing to drive awareness from a pretty low base.

We see distribution opportunities in front of us, and I’m really excited about disruptive innovation we’ll be bringing out within the next year on the business.

Operator: Thank you. Our next question comes from the line of John Joseph Baumgartner with Mizuho Securities USA LLC. Please proceed with your question.

Good morning. Thanks for the question.

Hi, John.

Good morning. Geoff, you mentioned the price increase that’s forthcoming at retail. How are you thinking about elasticity on the back of that? Should it be higher than history given the health of the consumer? Related to that, if you can just please clarify the focus on the entry prices for Atkins bars. Are you finding that absolute prices today, after the last few price increases taken, have prices become an impediment to consumption among existing buyers, or is this more of a mixed shift? As the category mainstreams, new households come in, maybe more middle-income consumers, does it require lower prices to attract new households?

Geoff Tanner, President and CEO, Simply Good Foods Company: Yeah. On pricing, we have announced pricing on portions of the portfolio, kind of in the mid to high single-digit range. We expect elasticity to be in line with what we would historically see, but we have seen that initially the elasticity impact may be a little higher and then tends to burn off, which is, as you heard Chris Bealer mention earlier, is one of the drivers of our first half, second half inflection. To your question on have we seen pricing dampen growth? Absolutely not. This has proven to be a category that is pretty resilient to pricing in the long run. You don’t get to five years of high single, low double-digit growth if that’s happening. This seems to be a category. Sorry,

Operator: That’s very resilient to pricing in the long run. To your question on Atkins, more attractive entry price point, we at Atkins, products, our entry price point was in a five-pack, where the majority of competition was in a four-pack. That just created a higher absolute price on shelf. As we did our research, we identified an opportunity to come out with a four-pack at a lower absolute price. It’s early, too early to call it. We are certainly seeing the entry price point bring in new users to the brand.

Joshua Levine, Vice President of Investor Relations, Simply Good Foods Company: Okay, thanks, Geoff.

Geoff Tanner, President and CEO, Simply Good Foods Company: Thank you. Our next question comes from the line of Matthew Edward Smith with Stifel. Please proceed with your question.

Chris Bealer, CFO, Simply Good Foods Company: Hi. Good morning. Just wanted to come back to the comments on sales expectations by brand and phasing. First, Atkins consumption is expected to be down around 20%. You also called out that your inventories may move lower given some of the distribution losses. Do you have an estimate for where you would expect that inventory headwind to come in? Second, you called out a tough merchandising comparison in the second quarter, specifically for Quest. Is that related to lapping the large club event last year? Can you provide an update on how your distribution opportunity or expansion is going within the club channel? I think you had some positive takeaways from a large event last year, and you were going through an evaluation period. Curious how you’re continuing to see that evolve. Thank you.

Operator: Yeah. To start with, I’ll address Atkins. Yeah, we do see Atkins, we think net sales will be down more than 20% in the first half, which is, as you rightly pointed out, the consumption decline we called out on the call earlier, as well as the distribution impact. As that distribution comes out, obviously, we’ll be low at retail for those points. That will be coming down more than 20% in the first half, a bit better in the second half. In terms of Quest, yeah, we are lapping some heavy merchandising in Q2 last year. Also remember that, as we just talked about, we have price elasticities that will be really in effect, full effect in the second quarter, which is an impact. We’re very happy with where especially the salty snacks business is running. Obviously, still very strong and lots of momentum left on that business.

Analyst: Yeah. I can pick up the question on Quest. You’re right. Last year, during New Year, we had a test at a large club customer where we have really not had any business at all. The test performed very well, and we’ve had continued conversations with that customer about how to roll that out. The way that it looks like it’s going to phase at this point is that it will be more spread out throughout the year, more consistent distribution versus having all of that distribution as we did in January, February, and a little bit into March. That’s where we’re landing right now. We continue to work with that customer. I’m really excited about the new relationship we’re building with that customer. It does represent for Simply significant white space from a distribution perspective.

More specifically, back to the Quest chips and the lap is the spreading effect of that volume that’ll now be more spread throughout the rest of the year as opposed to concentrated.

Geoff Tanner, President and CEO, Simply Good Foods Company: Thank you. Our last question comes from the line of James Ronald Salera with Stephens Inc. Please proceed with your question.

Hey, Geoff. Hey, Chris. Good morning. Thanks for taking our question. I wanted to circle back on the margin component of the guidance. Are you guys able to remind us what % of COGS cocoa represents? If you can give any commentary around the layering of your hedges, there’s been a lot of volatility in cocoa, so we’re just trying to get a sense, you know, if prices continue to fall, could there be gross margin relief maybe earlier than 3Q, or to a greater magnitude in 3Q? Just any comments there would be helpful.

Operator: Yeah. I mean, in terms of cocoa, just to remind you, cocoa is, we do buy cocoa directly. We also have, cocoa is a significant component of our coatings, layers, and inclusions. As a percentage of our overall cost, it’s in the mid-single-digit range. Then from a coverage perspective, which I think was the other part of your question, we are covered out quite far into the year. Certainly, first half, to remind you, I think we talked about it on the call. We are covered in the first half of the year at fairly high prices that we took as we were just ensuring supply. As we get into Q3, we’ll be transitioning into much lower costs and actually, deflationary year over year. As we go into Q4, that will take into effect, take even more into effect, lower prices, which will then carry into FY2027.

The only other point I would say on margins, as you started with a more general point, is we have pricing, as we said, really starting in Q1, really mostly in fiscal November and building into Q2. Productivity, we said, we’ve always said is on a lag, and that will be really kicking in fully in the second half. That’s why we have pretty good confidence if you look at our costs. Costs are well understood through most of the fiscal year. Pricing is building. Productivity is building. We do see, even in the spot prices, specifically on cocoa, even further opportunity, again, as we think about Q4 and into 2027.

Analyst: Yeah. The spot has come down quite considerably in the last couple of months, and certainly considerably from the position we have today through the first half.

Geoff Tanner, President and CEO, Simply Good Foods Company: Thank you. We have reached the end of the question and answer session. I’ll now turn the floor back to Geoff Tanner for closing remarks.

Analyst: That’s fine. Thank everyone for the participation today on the call. If you’ve got any follow-ups, please feel free to reach out to Josh. We look forward to speaking to you in January.

Geoff Tanner, President and CEO, Simply Good Foods Company: Thank you. This concludes today’s conference, and you may disconnect your line at this time. Thank you for your participation.

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