Financial Analysis

"ACQUISITIONS On October 25, 2024, the Company acquired all the outstanding common stock of Endless Summer Technologies Proprietary, Limited (""EST"") and related patents and other assets used in EST's business and operations in a purchase transaction with EST's sole shareholder (the ""Seller""). EST, based in Durban, South Africa, has been a long term supplier of products to the Company and it specializes in the design, development and manufacturing of scuba equipment through unique application of existing, new and emerging technologies. The EST acquisition is included in the Company's Diving segment, and is expected to provide new innovative products, unlock synergies and enhance operating efficiencies for the Diving segment. The approximately $12,197 acquisition cost was funded with existing cash. Approximately $1,650 of the purchase price was paid into segregated escrow accounts which were set aside to fund (1) any potential downward purchase price adjustment tied to cash, debt and net working capital levels as of the closing or (2) potential indemnity claims that may be made by the Company against the Seller in connection with the inaccuracy of certain representations and warranties made by the Seller or related to the breach or nonperformance of certain other actions, agreements or conditions related to the acquisition, for a period of 24 months from the acquisition date. The Company cannot estimate the probability or likelihood of bringing such an indemnity claim again …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

CONTINGENCIES The Company is subject to various legal actions and proceedings in the normal course of business, including those related to commercial disputes, product liability, intellectual property and environmental matters. The Company is insured against loss for certain of these matters. Although litigation is subject to many uncertainties and the ultimate exposure with respect to these matters cannot be ascertained, management does not believe the final outcome of any pending litigation will have a material adverse effect on the financial condition, results of operations, liquidity or cash flows of the Company.

CommitmentsAndContingenciesDisclosureTextBlock

"INDEBTEDNESS The Company had no outstanding debt at October 3, 2025 or September 27, 2024. Revolvers The Company and certain of its subsidiaries have entered into an unsecured revolving credit facility with PNC Bank, National Association and Associated Bank, N.A. (""the Lending Group""). This credit facility consists of a $75 million Revolving Credit Facility among the Company, certain of the Company's subsidiaries, PNC Bank National Association, as lender and as administrative agent, and the other lender named therein (the ""Credit Agreement"" or ""Revolver""). The Revolver provides for borrowing of up to an aggregate principal amount not to exceed $75,000 with a $50,000 accordion feature that gives the Company the option to increase the maximum financing availability (i.e., an aggregate borrowing amount of $125,000) subject to the conditions of the Credit Agreement and subject to the approval of the lenders. On July 15, 2021, the Company entered into a First Amendment to this credit facility that extended its expiration date from November 15, 2022, to July 15, 2026. Other key provisions of the credit facility remained as outlined above and the description herein is qualified in its entirety by the terms and conditions of the original Debt Agreement (a copy of which was filed as Exhibit 99.1 to the current report on Form 8-K dated and filed with the Securities and Exchange Commission on November 20, 2017) and the Amendment (a copy of which was filed as Exhibit 10.1 to the c …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS The Companys current stock ownership plans provide for issuance of options to acquire shares of Class A common stock by key executives and non-employee directors. Current plans also allow for issuance of shares of restricted stock, restricted stock units or stock appreciation rights in lieu of options. Under the Companys 2023 Non-Employee Director Stock Ownership Plan and the 2020 Long-Term Incentive Plan (the only plans where shares currently remain available for future equity incentive awards) there were a total of 284,109 shares of the Companys Class A common stock available for grant to key executives and non-employee directors at October 3, 2025. Share awards previously made under the Company's 2010 Long-Term Stock Incentive Plan and 2012 Non-Employee Director Stock Ownership Plan, which no longer allow for additional share grants, also remain outstanding. The Company recognized additional tax expense of $207 and $351, and $95 for 2025, 2024, and 2023, respectively, from the vesting of restricted stock and restricted stock units. These amounts were recorded as a component of income tax (benefit) expense. The Company recognizes forfeitures of non-vested equity awards as incurred. Non-Vested Stock All outstanding shares of non-vested stock awarded by the Company have been granted at their fair market value on the date of grant and vest within five years after the grant date. The fair value at date of grant is based on the …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

"FAIR VALUE MEASUREMENTS Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. A fair value hierarchy has been established based on three levels of inputs, of which the first two are considered observable and the last unobservable. Level 1 - Quoted prices in active markets for identical assets or liabilities. These are typically obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 - Inputs, other than quoted prices included within Level 1, which are observable for the asset or liability, either directly or indirectly. These are typically obtained from readily-available pricing sources for comparable instruments. Level 3 - Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entitys own assumptions of the data that market participants would use in pricing the asset or liability, based on the best information available in the circumstances. The carrying value of accounts receivable and accounts payable approximate fair value because of the short-term maturity of those instruments. The followin …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

"INCOME TAXES The U.S. and foreign income before income taxes for the respective years consisted of the following: 2025 2024 2023 United States $ (11,745) $ (32,560) $ 16,070 Foreign 2,466 2,698 9,754 $ (9,279) $ (29,862) $ 25,824 Income tax expense for the respective years consisted of the following: 2025 2024 2023 Current: Federal $ 1,595 $ 159 $ 7,631 State 597 40 2,267 Foreign 2,193 1,618 3,286 Deferred 20,630 (5,146) (6,894) $ 25,015 $ (3,329) $ 6,290 The tax effects of temporary differences that give rise to deferred tax assets and deferred tax liabilities at the end of the respective years are presented below: 2025 2024 Deferred tax assets: Inventories $ 5,139 $ 6,126 Compensation 5,437 4,386 Lease liabilities 10,299 10,746 Tax credit carryforwards 1,670 2,272 Net operating loss carryforwards 9,407 5,374 Research and Experimental Expenditures 12,881 8,846 Other 7,820 7,510 Total gross deferred tax assets 52,653 45,260 Less valuation allowance 35,725 6,367 Deferred tax assets 16,928 38,893 Deferred tax liabilities: Goodwill and other intangibles 2,200 1,395 Right of Use assets 9,806 10,316 Depreciation and amortization 3,097 4,941 Foreign statutory reserves 812 734 Net deferred tax assets $ 1,013 $ 21,507 The net deferred tax assets recorded in the accompanying Consolidated Balance Sheets as of the years ended October 3, 2025 and September 27, 2024 were as follows: 2025 2024 Non-current assets $ 3,074 $ 23,420 Non-current liabilities 2,061 1,913 Net deferred tax assets …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

"LEASES The Company determines if an arrangement is a lease at inception. The Company leases certain facilities and machinery and equipment under long-term, non-cancelable operating leases. As an ongoing accounting policy election under Topic 842, the Company excludes short-term leases (terms of 12 months or less) from the balance sheet presentation and accounts for non-lease and lease components in a contract as a single lease component for most asset classes. All leases in which the Company is the lessee are classified as operating leases, and the Company does not have any finance leases or sublease agreements. Additionally, the Company does not have any leases in which it is the lessor. As of October 3, 2025, the Company had approximately 200 leases, with remaining terms ranging from less than one year to 16 years. Some of the leases contain variable payment terms, such as payments based on fluctuations in the Consumer Price Index (CPI). Variable lease payments are expensed in the period in which the obligation for those payments was incurred. Some leases also contain options to extend or terminate the lease. To the extent the Company is reasonably certain to exercise these options, they have been considered in the calculation of the right-of-use (""ROU"") assets and lease liabilities. Under current lease agreements, there are no residual value guarantees or restrictive lease covenants. In calculating the ROU assets and lease liabilities, several assumptions and judgments …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

New Accounting Pronouncements Recently issued accounting pronouncements In November 2023, the Financial Account Standards Board (FASB), issued Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 is intended to improve the disclosures about a public entity's reportable segments and address requests from investors for additional, more detailed information about a reportable segment's expenses. The amendments in this ASU do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. The amendments to this standard apply to all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting and are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted this guidance for the year ending October 3, 2025 and subsequent interim periods. The adoption of this standard did not impact the Companys results of operations or financial position. See Note 13 Segments of Business for the new disclosures required by the standard. In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses: Measurement of Credit Losses for Accounts Receivable and Contract Assets (Topic 326). The update permits entities to elect a practical expedi …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

EMPLOYEE BENEFITS A majority of the Companys full-time employees are covered by defined contribution programs. Expenses attributable to the defined contribution programs were approximately $2,136, $2,187 and $2,190 for 2025, 2024 and 2023, respectively. The Company also has a non-qualified deferred compensation plan that provides certain officers and employees the ability to defer a portion of their compensation until a later date. The deferred amounts and earnings thereon are payable to participants, or designated beneficiaries, at specified future dates upon retirement, death or termination of employment from the Company. The deferred compensation liability, which is reported at fair value equal to the related rabbi trust assets, and is classified as Deferred compensation liability on our accompanying Consolidated Balance Sheets, was approximately $30,681 and $29,092 as of October 3, 2025 and September 27, 2024, respectively. See Note 4 Fair Value Measurements for additional information. …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

RELATED PARTY TRANSACTIONS The Company conducts transactions with certain related parties including organizations controlled by the Johnson Family. These transactions include product purchases, aviation services, office rental, and facility fees. Total costs of these transactions were $1,782, $1,537 and $1,473 for 2025, 2024 and 2023, respectively. Amounts due to/from related parties were immaterial at October 3, 2025 and September 27, 2024.

RelatedPartyTransactionsDisclosureTextBlock

"REVENUES Revenue recognition Revenue is recognized when performance obligations under the terms of a contract with our customer are satisfied; generally this occurs with the transfer of control of our goods at a point in time based on shipping terms and transfer of title. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods. The amount of consideration received can vary, primarily because of customer incentive or rebate arrangements. The Company estimates variable consideration based on the expected value of total consideration to which customers are likely to be entitled based on historical experience and projected market expectations. Included in the estimate is an assessment as to whether any variable consideration is constrained. Revenue estimates are adjusted at the earlier of a change in the expected value of consideration or when the consideration becomes fixed. For all contracts with customers, the Company has not adjusted the promised amount of consideration for the effects of a significant financing component as the period between the transfer of the promised goods and the customer's payment is expected to be one year or less. Sales are made on normal and customary short-term credit terms, generally ranging from 30 to 90 days, or upon delivery of point of sale transactions. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. The Company enters into …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

"SEGMENTS OF BUSINESS The Company conducts its worldwide operations through separate business segments, each of which represent major product lines. Operations are conducted in the U.S. and various foreign countries, primarily in Europe, Canada and the Pacific Basin. During the years ended October 3, 2025, September 27, 2024, and September 29, 2023, combined sales to one customer of the Company's Fishing, Camping and Watercraft Recreation segments represented approximately $119,540, $113,509, and $101,392 respectively, of the Company's consolidated revenues. The Company has historically reported ""Camping"" and ""Watercraft Recreation"" segments separately. Starting in the first fiscal quarter of 2025, the Company combined these two segments into one segment, ""Camping & Watercraft Recreation,"" consistent with the manner in which its chief operating decision maker (""CODM"") assesses performance and makes resource allocations. The operating segment change was for financial reporting purposes only and did not impact or result in changes to operations of the business segments, nor did it impact the Company's consolidated financial statements, but it did impact our previous segment footnote disclosure and the table below, including the corresponding items of segment information disclosed in the prior year. The Company sold the Military and Commercial Tent product lines of its Camping & Watercraft Recreation business segment to a third party in an asset sale for a purcha …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

"SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Johnson Outdoors Inc. (the Company) is an integrated, global outdoor recreation products company engaged in the innovative design, manufacture and marketing of brand name camping, diving, watercraft and marine electronics products. Principles of Consolidation The consolidated financial statements include the accounts of Johnson Outdoors Inc. and all majority owned subsidiaries and are stated in conformity with U.S. generally accepted accounting principles. Intercompany accounts and transactions have been eliminated upon consolidation. Use of Estimates The preparation of financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities and operating results and the disclosure of commitments and contingent liabilities. Actual results could differ significantly from those estimates. Fiscal Year The Companys fiscal year ends on the Friday nearest September 30. The fiscal year ended October 3, 2025 (hereinafter 2025) comprised 53 weeks and the fiscal years ended September 27, 2024 (hereinafter 2024) and September 29, 2023 (hereinafter 2023) each comprised 52 weeks. Cash, Cash Equivalents and Marketable Securities The Company considers all short-term investments in interest bearing accounts and all securities and other instruments with an original maturity of three months or less to be cash equivalents. Cash equivalents are stated at cost which approximates market v …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

"ACQUISITIONS On October 25, 2024, the Company acquired all the outstanding common stock of Endless Summer Technologies Proprietary, Ltd (""EST"") and related patents and other assets used in EST's business and operations in a purchase transaction with EST's sole shareholder (the ""Seller""). EST, based in Durban, South Africa, has been a long term supplier of products to the Company and it specializes in the design, development and manufacturing of scuba equipment through unique application of existing, new and emerging technologies. The EST acquisition is included in the Company's Diving segment, and is expected to provide new innovative products, unlock synergies and enhance operating efficiencies for the Diving segment. The approximately $12,197 acquisition cost was funded with existing cash. Approximately $1,650 of the purchase price was paid into segregated escrow accounts which were set aside to fund (1) any potential downward purchase price adjustment tied to cash, debt and net working capital levels as of the closing or (2) potential indemnity claims that may be made by the Company against the Seller in connection with the inaccuracy of certain representations and warranties made by the Seller or related to the breach or nonperformance of certain other actions, agreements or conditions related to the acquisition, for a period of 24 months from the acquisition date. The Company cannot estimate the probability or likelihood of bringing such an indemnity claim against t …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

CONTINGENCIES The Company is subject to various legal actions and proceedings in the normal course of business, including those related to commercial disputes, product liability, intellectual property and regulatory matters. The Company is insured against loss for certain of these matters. Although litigation is subject to many uncertainties and the ultimate exposure with respect to these matters cannot be ascertained, management does not believe the final outcome of any pending litigation will have a material adverse effect on the financial condition, results of operations, liquidity or cash flows of the Company.

CommitmentsAndContingenciesDisclosureTextBlock

"INDEBTEDNESS The Company had no debt outstanding at January 2, 2026, October 3, 2025, or December 27, 2024. Revolver The Company and certain of its subsidiaries entered into an unsecured credit facility with PNC Bank National Association and Associated Bank, N.A. (""the Lending Group""). This credit facility consisted of a $75 million Revolving Credit Facility among the Company, certain of the Companys subsidiaries, PNC Bank National Association, as lender and as administrative agent, and the other lender named therein (as amended, the Credit Agreement or Revolver). The Revolver provides for borrowing of up to an aggregate principal amount not to exceed $75,000 with a $50,000 accordion feature that gave the Company the option to request an increase of the maximum financing availability (i.e., an aggregate borrowing amount of $125,000) subject to the conditions of the Credit Agreement and subject to the approval of the lenders. On July 15, 2021, the Company entered into a First Amendment to this credit facility that extended its expiration date from November 15, 2022, to July 15, 2026. On January 29, 2025, the Company entered into a Second Amendment to this credit facility that reduced the Revolver to $50,000 (but maintained the accordion feature) and modified the terms of the Credit Agreement. Effective as of December 9, 2025, the Company and certain of its subsidiaries entered into a Second Amended and Restated Credit Agreement which amends and restates the Companys Amended …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS The Companys current stock ownership plans allow for issuance of stock options to acquire shares of Class A common stock by key executives and non-employee directors. Current plans also allow for issuance of shares of restricted stock, restricted stock units or stock appreciation rights in lieu of stock options. Under the Companys 2023 Non-Employee Director Stock Ownership Plan and the 2020 Long-Term Incentive Plan (the only plans where shares currently remain available for future equity incentive awards) there were a total of 173,038 shares of the Companys Class A common stock available for future grant to non-employee directors and key executives at January 2, 2026. Share awards previously made under the Company's 2012 Non-Employee Director Stock Ownership Plan, which no longer allow for additional share grants, also remain outstanding. Non-vested Stock All shares of non-vested restricted stock awarded by the Company have been granted in the form of shares of Class A common stock at their fair market value on the date of grant and vest within one year from the date of grant for stock granted to directors and within a period ranging from one to four years from the date of grant for stock granted to officers and employees, based on the terms of the agreement with such officer or employee. The fair value at date of grant is based on the number of shares granted and the average of the Companys high and low Class A common stock …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

"FAIR VALUE MEASUREMENTS Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. A fair value hierarchy has been established based on three levels of inputs, of which the first two are considered observable and the last unobservable. Level 1 - Quoted prices in active markets for identical assets or liabilities. These are typically obtained from real-time quotes for transactions in active exchange markets involving identical assets or liabilities. Level 2 - Inputs, other than quoted prices included within Level 1, which are observable for the asset or liability, either directly or indirectly. These are typically obtained from readily-available pricing sources for comparable instruments. Level 3 - Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entitys own assumptions of the data that market participants would use in pricing the asset or liability, based on the best information available in the circumstances. The carrying amounts of accounts receivable, accounts payable and accrued expenses approximated their fair values at January 2, 2026, Octobe …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

INCOME TAXES For the three months ended January 2, 2026 and December 27, 2024, the Companys earnings before income taxes, income tax expense and effective income tax rate were as follows: Three Months Ended (thousands, except tax rate data) January 2, 2026 December 27, 2024 Loss before income taxes $ (1,255) $ (18,927) Income tax expense (benefit) 2,045 (3,637) Effective income tax rate (162.9) % 19.2 % The change in the Companys effective tax rate for the three months ended January 2, 2026 versus the prior year period was primarily due to an adjustment related to its U.S. valuation allowance on deferred tax assets. Additionally, the change was further driven by the geographic mix of profits or losses from a tax perspective in the current year. The Company's effective tax rate is impacted by valuation allowances in domestic and certain foreign tax jurisdictions and, as a result, changes in the geographic source of Company profits or losses between periods can, in certain instances, have varying impacts on the Company's effective tax rate during a particular period. The Company maintains valuation allowances when it is more likely than not that all or a portion of a deferred tax asset will not be realized. Changes in valuation allowances from period to period are included in the tax provision in the period of change. In determining whether a valuation allowance is required, the Company considers such factors as prior earnings history, expected future earnings, carry-back and c …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

"LEASES The Company leases certain facilities and machinery and equipment under long-term, non-cancelable operating leases. The Company determines if an arrangement is a lease at inception. As of January 2, 2026, the Company had approximately 150 leases, with remaining terms ranging from less than one year to 14 years. Some of the leases contain variable payment terms, such as payments based on fluctuations in the Consumer Price Index (CPI). Some leases also contain options to extend or terminate the lease. To the extent the Company is reasonably certain to exercise these options, they have been considered in the calculation of the right-of-use (""ROU"") assets and lease liabilities. Under current lease agreements, there are no residual value guarantees or restrictive lease covenants. In calculating the ROU assets and lease liabilities, several assumptions and judgments were made by the Company, including whether a contract is or contains a lease under the applicable definition, and the determination of the discount rate, which is assumed to be the incremental borrowing rate. The incremental borrowing rate is derived from information available to the Company at the lease commencement date based on lease length and location. The components of lease expense recognized in the accompanying Condensed Consolidated Statements of Operations for the three months ended January 2, 2026 and December 27, 2024 were as follows: Three months ended January 2, 2026 December 27, 2024 Lease Cost …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

NEW ACCOUNTING PRONOUNCEMENTS Recently adopted accounting pronouncements In November 2023, the Financial Account Standards Board (FASB), issued Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 is intended to improve the disclosures about a public entity's reportable segments and address requests from investors for additional, more detailed information about a reportable segment's expenses. The amendments in this ASU do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. The amendments to this standard apply to all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting and are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted this guidance for the year ending October 3, 2025 and subsequent interim periods. The adoption of this standard did not impact the Companys results of operations or financial position. See Note 16 Segments of Business for the new disclosures required by the standard. Recently issued accounting pronouncements In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses: Measurement of Credit Losses for Accounts Receivable and Contract Assets (Topic 326). The update p …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

"REVENUES Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; generally this occurs with the transfer of control of our goods at a point in time based on shipping terms and transfer of title. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods. The amount of consideration received can vary, primarily because of customer incentive or rebate arrangements. The Company estimates variable consideration based on the expected value of total consideration to which customers are likely to be entitled based on historical experience and projected market expectations. Included in the estimate is an assessment as to whether any variable consideration is constrained. Revenue estimates are adjusted at the earlier of a change in the expected value of consideration or when the consideration becomes fixed. For all contracts with customers, the Company has not adjusted the promised amount of consideration for the effects of a significant financing component as the period between the transfer of the promised goods and the customer's payment is expected to be one year or less. Sales are made on normal and customary short-term credit terms, generally ranging from 30 to 90 days, or upon delivery of point of sale transactions. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. The Company enters into contractual arrangements with c …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

"SEGMENTS OF BUSINESS The Company conducts its worldwide operations through separate business segments, each of which represents major product lines. Operations are conducted in the United States and various foreign countries, primarily in Europe, Canada and the Pacific Basin. The Companys Chief Executive Officer, who has been identified as the chief operating decision maker, ""CODM,"" primarily uses operating profit as the measure of profit or loss to assess segment performance and allocate resources. Operating profit represents net sales less cost of goods sold and operating expenses. Net Sales are directly attributed to each segment. Segment operating expenses include operating expenses directly attributable to the segment, as well as certain shared corporate administration and other costs which are allocated to the segments in a reasonable manner considering the specific facts and circumstances of the expenses being allocated. The CODM evaluates segment profitability based on operating profit (loss) because it provides key insights to operational leverage and other key operational metrics for each segment. Additionally, segment operating profit (loss) is used in the annual budgeting and forecasting process, and budget-to-actual and forecast-to-actual variances are considered when determining how resources should be allocated to each segment. Net sales and operating profit include both sales to customers, as reported in the Companys accompanying Condensed Consolidated Stat …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing