Traeger, Inc.

I'll now hand it over to your host, Nick Backus, Vice President of Investor Relations. Please go ahead.

Good afternoon, everyone. Thank you for joining Traeger's call to discuss its third quarter 2024 results, which were released this afternoon and can be found on our website at investors.traeger.com. I'm Nick Backus, Vice President of Investor Relations at Traeger. With me on the call today are Jeremy Andrus, our Chief Executive Officer, and Don Bossel, our Chief Financial Officer. Before we get started, I want to remind everyone that management's remarks on this call may contain forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations and views of future events including, but not limited to, outlook as to revenue results for conceivables and accessories categories for the fourth quarter of 2024 and our anticipated full-year fiscal 2024 results. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied herein. I encourage you to review our annual report on Form 10-K for the year ended December 31st, 2023, our quarterly report on Form 10-Q for the quarter ended September 30th, 2024, once filed, and our other SEC filings for discussion of these factors and uncertainties, which are available on the investor relations portion of our website. You should not take undue reliance on these forward-looking statements, which we speak to only as of today. We undertake no obligation to update or revise them for any new information. This call will also contain certain non-GAAP financial measures, including adjusted EBITDA, adjusted net income or loss, adjusted net income or loss per share, and adjusted EBITDA margin, which we believe are useful supplemental measures. The most comparable GAAP financial measures and reconciliations of the non-GAAP measures contained herein to such GAAP measures are included in our earnings release, which is available on the investor relations portion of our website at investors.trigger.com. Please note that our definition of these measures may differ from similarly titled metrics presented by other companies. Now I'd like to turn the call over to Jeremy Andrus, Chief Executive Officer of Traeger. Jeremy.

Thanks, Nick. Thank you for joining our third quarter 2024 earnings call. I will start by reviewing our third quarter performance and then turn the call over to Dom to discuss our financial results and to provide more detail on our 2024 financial guidance. This afternoon, we reported solid third quarter results that exceeded our internal expectations and demonstrate our team's dedication to driving consistent improvements to the business. Our third quarter performance included several important highlights. First, we returned to top line growth in the quarter with revenue growth of 4%. Critically, this growth was driven by very strong performance in our grills category, which grew 32% as compared to the prior year. Second, our profitability improved significantly. Third quarter gross margin expanded by 440 basis points. This improvement in gross margin was driven by both external factors as well as our margin enhancement initiatives, which continued to bear fruit. Expense discipline, along with the strong gross margin improvement, translated to adjusted EBITDA of $12 million, a significant improvement from last year's $5 million, and drove adjusted EBITDA margin expansion of 610 basis points versus the third quarter of last year. Given our better than anticipated third quarter performance, we are increasing our fiscal 2024 financial guidance. We now expect sales of 595 to $605 million and adjusted EBITDA of 78 to $81 million. At the midpoint of the range, we are increasing our adjusted EBITDA guidance by 4% on top of last quarter's 15% increase in guidance. This increase in our adjusted EBITDA guidance is being driven by our third quarter performance and our expectation for full year gross margin to be 41.8% to 42.3% up from our previous 40.5% to 41.5% range. The growth in our grills business in the third quarter reflects strong sell through at retail during the period. Our strategy to lean into promotions this year, given the soft industry demand backdrop, was successful and the consumer responded favorably to our Labor Day promotion. Given that our retail partners experienced better than anticipated sell through in our peak season, channeled inventories coming out of the second quarter were in a very clean position. and the strong consumer demand in the third quarter drove upside in replenishment sales. I am pleased with the stronger than anticipated grills demand in the quarter. Despite this performance, we continue to view the consumer demand backdrop as mixed for our category, and we think the consumer remains discerning in their purchasing behavior. While we saw healthy sell-through across our overall grill assortment, we continue to see outperformance in grills that are priced below $1,000, which we believe demonstrates that the consumer remains selective in their spending patterns. And while we did see a reduction in our grills ASP partially due to this mix shift, as well as our promotional strategy, we are bringing new customers into the Traeger hood and we are gaining market share. We view this favorably as our strong brand loyalty and attachment of adjacent revenue streams like pellets and accessories contribute to a high customer lifetime value. The strength in our third quarter grills performance is giving us the confidence to increase our full year outlook for the grill segment. We are now assuming positive low single digit growth in grills for the year. I am very pleased with our ability to grow our grills revenues in an environment that remains challenging for big ticket and home related goods purchases. Our sell-through performance in the third quarter demonstrates that there is a strong and growing appetite for the Traeger brand. As I've discussed on prior calls, our largest opportunity and our first long-term growth pillar is to accelerate brand awareness and penetration in the United States. I believe that the elements for growth remain in place and that our brand health is stronger than ever. For example, our research shows that Traeger's unaided brand awareness as of the third quarter increased by approximately 20% as compared to 2022. The fact that awareness of the Traeger brand is meaningfully growing in a challenging industry environment and during a time when we have not been investing aggressively into top of funnel marketing is evidence of the strength of our brand. The affinity for the brand within the Traeger hood is also evidenced by our industry leading net promoter score. which remains materially higher than any other outdoor cooking brand. The energy around Traeger is being fueled by our continued investment in community engagement and brand activation. Our social media presence continues to be a strong source of connection with the Traeger hood, and our digital content is an important part of the consumer flywheel. We continue this activation strategy in the third quarter. In August, we kicked off Traeger Game Day. This social campaign features giveaways, contests, recipes, and content, all focused on engaging the Traegerhood during football season. We also launched Traeger Kitchen in the third quarter. Traeger Kitchen is a weekly YouTube series featuring pro chefs and pit masters giving step-by-step tutorials of their favorite recipes cooked on the Traeger. Viewers can get tips, tricks, and recipes for cooking on their Traeger from some of the biggest names in outdoor cooking by tuning in. The feedback and reception from the Traegerhood has been fantastic, and we are seeing strong growth in YouTube subscribers since its launch. Moving on to our accessories business. In the third quarter, the strong growth in our grills business was partially offset by softness in our accessories category. driven by a reduction in revenues at meter. As we discussed last quarter, meter is seeing pressure on its e-commerce sales, which we believe is largely attributable to a change in its demand creation strategy earlier this year, which proved ineffective. We were anticipating continued pressure on meter in Q3, and sales results ended modestly lower than our expectations. The good news is that the third quarter is meter's lowest volume period of the year, we have implemented strategies to drive improvement going forward meter is a fourth quarter weighted business and ahead of the holiday selling period the team is focused on re-accelerating prospect marketing to fill the funnel of potential customers we are increasing our demand creation with the focus on driving conversion at a healthy row as in meters peak season meter has also brought innovation to the market with its launch of meter pro excel METER's four-probe solution in September and its recent launch of METER Pro Duo, its new two-probe solution. We believe that METER's revamped demand creation strategy and recent product innovation will drive improvement in the fourth quarter and into next year. However, while we expect sequential improvement in the trend, we are planning for a decline in our accessories business in the fourth quarter. Moving on to consumables. Our consumables revenues declined in the third quarter. However, this was largely due to a shift in revenue pace in your pellet business. Underlying demand trends for consumables remain healthy, and third quarter sell-through was positive for both pellets and food consumables. We are expecting our consumables category to return to positive growth in the fourth quarter. Driving recurring revenue of your consumables offering remains a long-term growth pillar. In the third quarter, we relaunched our meat church blend wood pellets, a limited edition pellet, in partnership with pit master and Traeger ambassador Matt Pittman. On the food consumable side, we continue to gain distribution and added rubs into Safeway for the first time in September. Overall, I am pleased with our third quarter performance and our team's ability to execute. Thus far in 2024, we have demonstrated our ability to successfully navigate a period of challenging consumer demand in our category and have grown adjusted EBITDA while continuing to invest in our long-term growth pillars. I am grateful for our retail partners with whom we have worked closely to drive a successful year thus far and with whom we are eager to continue to grow. I also want to thank the entire Traeger team for their hard work and dedication to serving our consumer and driving continued improvements in our business. As I look forward to the rest of this year and into next year and beyond, I continue to be extremely confident in Traeger's positioning and our ability to drive growth. The improvement in sell-through trends over the last two quarters is encouraging, and has ensured that channel inventories remain healthy and appropriate. This is great news as our product innovation pipeline is strong and is expected to accelerate into 2025 and beyond. I'll now turn the call over to Dom to discuss third quarter financial results in more detail. Dom?