Long-term Debt and Notes Payable |
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| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Long-term Debt and Notes Payable | Long-term Debt and Notes Payable Revolving Credit Facility
On October 22, 2025, the Company entered into a $300.0 million senior secured, cash flow-based revolving credit facility (the “Revolving Credit Facility”), which replaced the Company’s prior asset-based revolving credit facility, which was terminated. The scheduled maturity date for the Revolving Credit Facility is October 16, 2030. Under the terms of the Revolving Credit Facility, the Company pays interest on the unpaid principal amount outstanding at a rate equal to Term SOFR (as defined in the Revolving Credit Facility) plus an applicable margin ranging from 1.25% to 2.125%, determined based upon the Company’s Total Net Debt Leverage Ratio (as defined in the Revolving Credit Facility). The Company pays a quarterly commitment fee on unused Revolving Commitments ranging from 0.20% to 0.35%, determined based upon the Company’s Total Net Debt Leverage Ratio. The Revolving Credit Facility has an accordion feature that allows the Company to request incremental commitments of up to $100.0 million plus additional incremental amounts, subject to compliance with specified leverage requirements.
Pursuant to the Revolving Credit Facility, the Company is subject to a total net debt leverage ratio covenant that requires that the Company’s Total Net Debt Leverage Ratio may not exceed 4.50 to 1.00, a consolidated interest coverage ratio covenant that requires that the Company’s Consolidated Interest Coverage Ratio (as defined in the Revolving Credit Facility) may not be less than 3.50 to 1.00, and a secured net debt leverage ratio covenant that requires that the Company’s Secured Net Debt Leverage Ratio (as defined in the Revolving Credit Facility) may not exceed 3.00 to 1.00. As of July 4, 2026, the Company was in compliance with these covenants.
There was $60.0 million outstanding and $237.8 million available for future borrowings, net of outstanding letters of credit, under the Revolving Credit Facility at July 4, 2026, and $85.0 million outstanding and $212.8 million available at December 31, 2025.
Unamortized deferred debt issuance costs associated with the Revolving Credit Facility were $2.7 million and $3.0 million as of July 4, 2026 and December 31, 2025, respectively, and are recorded within Other Assets. Debt issuance cost amortization expense was $0.6 million for each of the three months ended July 4, 2026 and June 28, 2025, and $1.2 million for each of the six months ended July 4, 2026 and June 28, 2025. All costs are amortized to interest expense over the term of the respective agreement.
Interest expense was $2.3 million and $3.1 million for the three months ended July 4, 2026 and June 28, 2025, respectively, and $4.7 million and $6.2 million for the six months ended July 4, 2026 and June 28, 2025, respectively.
2030 Convertible Notes
On December 3, 2024, the Company issued $165.0 million aggregate principal amount of 5.500% Convertible Senior Notes due 2030 (the “2030 Convertible Notes”). The 2030 Convertible Notes bear interest at a rate of 5.500% per annum, payable semi-annually in arrears on March 15 and September 15 of each year. The 2030 Convertible Notes will mature on March 15, 2030, unless earlier converted, redeemed or repurchased. As adjusted for the Company’s twenty percent Class B stock distribution, the conversion rate is 53.0389 shares of common stock per $1,000 principal amount of 2030 Convertible Notes, which represents a conversion price of $18.85 per share. The 2030 Convertible Notes are convertible at the option of the holders at any time on or after December 15, 2029, until the close of business on the second scheduled trading day immediately preceding the maturity date. Upon conversion, the Company will satisfy its conversion obligations by paying and/or delivering, as the case may be, cash, shares of its common stock or a combination of cash and shares of its common stock, at its election.
Beginning March 20, 2028, if the Company’s stock price has been at least 130% of the conversion price for a specified period of time, the 2030 Convertible Notes may be called at the option of the issuer. Under the same conditions, the Company can elect to redeem the 2030 Convertible Notes for cash. After the first quarter of 2025, if the Company’s stock price has been at
least 130% of the conversion price for 20 of 30 trading days ending on and including the last trading day of the immediately preceding quarter, the 2030 Convertible Notes may be called at the option of the holder. During the fiscal quarter ended July 4, 2026, the Company’s stock price met the price trigger defined above, and therefore holders of the 2030 Convertible Notes will have the ability to convert their notes at their option at any time during the fiscal quarter ending October 3, 2026.
2031 Convertible Notes
On September 15, 2025, the Company issued $225.0 million aggregate principal amount of Convertible Senior Notes due 2031 (the “2031 Convertible Notes”). The 2031 Convertible Notes do not bear interest and will mature on January 15, 2031, unless earlier converted, redeemed or repurchased. As adjusted for the Company’s twenty percent Class B stock distribution, the conversion rate is 22.1283 shares of common stock per $1,000 principal amount of 2031 Convertible Notes, which represents a conversion price of $45.19 per share. The 2031 Convertible Notes are convertible at the option of the holders at any time on or after October 15, 2030, until the close of business on the second scheduled trading day immediately preceding the maturity date. Upon conversion, the Company will satisfy its conversion obligations by paying cash up to the aggregate principal amount of the 2031 Convertible Notes to be converted and paying and/or delivering, as the case may be, cash, shares of its common stock or a combination of cash and shares of its common stock, at its election, in respect of any amount in excess of the aggregate principal amount of the notes being converted.
Beginning January 22, 2029, if the Company’s stock price has been at least 130% of the conversion price for a specified period of time, the 2031 Convertible Notes may be called at the option of the Company. After the fourth quarter of 2025, if the Company’s stock price has been at least 130% of the conversion price for 5 of the first 20 trading days of a fiscal quarter, the 2031 Convertible Notes may be redeemed at the option of the holder during the 30‑trading day period beginning on, and including, the 21st trading day of such quarter. During the fiscal quarter ended July 4, 2026, the Company’s stock price met the price trigger defined above, and holders of the 2031 Convertible Notes had the ability to convert their notes at their option during the 30‑trading day period beginning on, and including, the 21st trading day of the quarter. No notes were converted.
The following table presents the outstanding principal amount and carrying value of the Convertible Notes as of the dates indicated:
The Company estimates the fair value of the convertible notes based on quoted prices for these instruments in active markets and classifies these fair value measurements as Level 1 within the fair value hierarchy. The fair value of the 2031 Convertible Notes was approximately $378.2 million and $264.1 million as of July 4, 2026 and December 31, 2025, respectively. The fair value of the 2030 Convertible Notes was approximately $126.7 million and $84.8 million as of July 4, 2026 and December 31, 2025, respectively.
Capped Call Transactions
In connection with the issuance of the 2031 Convertible Notes, we entered into capped call transactions (the “Capped Calls”) with certain financial institutions. The Capped Calls are generally expected to reduce the potential dilution to the Company’s common stock upon any conversion of the 2031 Convertible Notes and/or offset any potential cash payments the Company is required to make in excess of the principal amount of converted 2031 Convertible Notes, subject to a cap. As adjusted for the Company’s twenty percent Class B stock distribution, the cap price of the Capped Calls is approximately $68.44 per share of the Company’s common stock and is subject to certain adjustments under the terms of the capped call transactions. The Capped Calls expire January 15, 2031.
The Company used approximately $26.9 million of the net proceeds from the 2031 Convertible Notes to purchase the Capped Calls. These instruments are classified as equity and recorded within additional paid-in capital in the Consolidated Condensed Statements of Changes in Stockholders’ Equity.
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