SEGMENT REPORTING

3 Months Ended

Mar. 28, 2026

14. SEGMENT REPORTING

The Company conducts business as one operating and reportable segment that designs, manufactures, and markets in-ground swimming pools, pool covers, and pool liners. The Company’s Chief Executive Officer, who is the chief operating decision maker (“CODM”), reviews financial information presented on a consolidated basis for purposes of assessing financial performance and allocating resources.

The Company reports consolidated net income (loss), as management believes that is the measure most consistent with the measurement principles in the Company’s condensed consolidated financial statements. Consolidated net income (loss) is used by the CODM predominantly in the annual budget and forecasting, including consideration of budget-to-actual variances when making decisions about the allocation of operating and capital resources.

Operations of the Company’s single segment consisted of the following (in thousands):


	Fiscal Quarter Ended
	March 28, 2026		March 29, 2025
Net sales	$	117,315	$	111,420
Other cost of sales(1)	75,619		74,580
Other selling, general and administrative expense(2)	30,550		26,684
Depreciation	5,682		4,998
Amortization(3)	7,385		7,192
Stock-based compensation expense	1,104		1,971
Strategic initiative costs(4)	450		644
Acquisition and integration related costs(5)	3,126		267
Restructuring charges(6)	—		15
Interest expense, net	4,756		6,371
Other expense (income), net	818		(308)
Earnings from equity method investment	(835)		(953)
Income tax benefit	(2,806)		(4,079)
Net loss	$	(8,534)	$	(5,962)

(1)Other cost of sales includes total cost of sales (as presented in the condensed consolidated statements of operations) excluding depreciation, stock-based compensation, restructuring charges, and strategic initiative costs.

(2)Other selling, general and administrative expense includes total selling, general and administrative expense (as presented in the condensed consolidated statements of operations) excluding depreciation, amortization, stock-based compensation, strategic initiative costs and acquisition and integration related costs.

(3)Inclusive of finance lease amortization.

(4)Represents fees paid to external consultants and other expenses for our strategic initiatives.

(5)Represents acquisition and integration costs as well as other costs related to potential transactions.

(6)Represents costs that include severance and other expenses for our executive management changes.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

Latham Group, Inc. 10-Q