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BOSTON BEER CO INC

BOSTON BEER CO INCSAMEarnings & Financial Report

NYSE · Consumer Staples · Malt Beverages

The Boston Beer Company is an American brewery founded in 1984 by James "Jim" Koch and Rhonda Kallman. Boston Beer Company's first brand of beer was named Samuel Adams after Founding Father Samuel Adams, an American revolutionary patriot. Since its founding, Boston Beer has started several other brands, and in 2019 completed a merger with Dogfish Head Brewery.

What changed in BOSTON BEER CO INC's 10-K — 2024 vs 2025

Top changes in BOSTON BEER CO INC's 2025 10-K

265 paragraphs added · 283 removed · 221 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

93 edited+11 added−36 removed56 unchanged
The Company’s strategy is to create and offer a world-class variety of traditional and innovative alcohol beverages. The Company’s primary brands which include the Twisted Tea, Truly Hard Seltzer, Samuel Adams, Angry Orchard, Dogfish Head and Sun Cruiser brands are all available nationally.
The Company’s strategy is to create and offer a world-class variety of traditional and innovative alcohol beverages. The Company’s primary brands which include the Twisted Tea, Truly Hard Seltzer, Samuel Adams, Angry Orchard, Sun Cruiser and Dogfish Head brands are all available nationally.
The principal factors of competition in the market for Traditional beer and Beyond beer occasions include product quality and taste, brand advertising and imagery, trade and drinker promotions, pricing, packaging and the development of innovative new products. The Company distributes its products through independent Distributors who also distribute competitors’ products.
The principal factors of competition in the market for Beyond beer and Traditional beer occasions include product quality and taste, brand advertising and imagery, trade and drinker promotions, pricing, packaging and the development of innovative new products. The Company distributes its products through independent Distributors who also distribute competitors’ products.
Additionally, the Company believes it has competitive advantages over imported beers, including lower transportation costs, higher product quality, a lack of import charges and superior product freshness. 12 Regulation and Taxation The alcoholic beverage industry is regulated by federal, state and local governments. These regulations govern the production, sale and distribution of alcoholic beverages, including permitting, licensing, marketing and advertising.
Additionally, the Company believes it has competitive advantages over imported beers, including lower transportation costs, higher product quality, a lack of import charges and superior product freshness. Regulation and Taxation The alcoholic beverage industry is regulated by federal, state and local governments. These regulations govern the production, sale and distribution of alcoholic beverages, including permitting, licensing, marketing and advertising.
Since the proprietary strains cannot be replaced if destroyed, the Company protects these strains by storing multiple cultures of the same strain at different production locations and in several independent laboratories. 8 Apples. The Company uses special varieties and origins of apples in its hard ciders that it believes are important for their flavor profiles.
Since the proprietary strains cannot be replaced if destroyed, the Company protects these strains by storing multiple cultures of the same strain at different production locations and in several independent laboratories. Apples. The Company uses special varieties and origins of apples in its hard ciders that it believes are important for their flavor profiles.
The Company uses a wide array of point-of-sale items (banners, neon signs, umbrellas, glassware, display pieces, signs and menu stands) designed to stimulate impulse sales and continued awareness, where legal. 7 Packaging and Ingredients Historically, the Company has been successful in obtaining sufficient quantities of the packaging materials and ingredients used in the production of its beverages.
The Company uses a wide array of point-of-sale items (banners, neon signs, umbrellas, glassware, display pieces, signs and menu stands) designed to stimulate impulse sales and continued awareness, where legal. Packaging and Ingredients Historically, the Company has been successful in obtaining sufficient quantities of the packaging materials and ingredients used in the production of its beverages.
The Company would work with available third-party production facilities to attempt to minimize any potential disruptions. 10 Competition The US Beer Market is highly competitive due to large domestic and international brewers and a large number of smaller craft brewers and craft distilleries who distribute similar products that have similar pricing and target drinkers.
The Company would work with available third-party production facilities to attempt to minimize any potential disruptions. Competition The US Beer Market is highly competitive due to large domestic and international brewers and a large number of smaller craft brewers and craft distilleries who distribute similar products that have similar pricing and target drinkers.
As noted earlier, this category is small and highly competitive and the competitors include mostly small regional and local hard cider companies. Hard ciders are typically priced competitively with Traditional beer and Beyond beer and may compete for drinkers with beer, wine, spirits, or FMBs. Some of these competitors include "Bold Rock", "2 Towns" and “Blakes”.
As noted earlier, this category is small and highly competitive and the competitors include mostly small regional and local hard cider companies. Hard ciders are typically priced competitively with Traditional beer and Beyond beer and may compete for drinkers with beer, wine, spirits, or FMBs. Some of these competitors include "Bold Rock", "2 Towns", “Schilling” and “Blakes”.
Most recently, during 2023 and 2024, in separate transactions AB InBev and Molson Coors sold some of these craft brands and breweries to Tilray Brands, Inc a global cannabis, craft beer, spirits beverage company. 11 The Company’s Angry Orchard product line competes within the hard cider category.
Most recently, during 2023 and 2024, in separate transactions AB InBev and Molson Coors sold some of these craft brands and breweries to Tilray Brands, Inc a global cannabis, craft beer, and spirits beverage company. The Company’s Angry Orchard product line competes within the hard cider category.
The Company’s Board of Directors and the ELT believe that succession planning, talent management, culture, and diversity, equity, and inclusion are critical to the Company’s continued success. Succession Planning and Talent Management The Company regularly reviews talent development and succession plans for each of its functional areas to identify and develop a pipeline of talent to maintain business operations.
The Company’s Board of Directors and the ELT believe that succession planning, talent management, culture, and diversity, equity, and inclusion are critical to the Company’s continued success. Succession Planning and Talent Management 12 The Company regularly reviews talent development and succession plans for each of its functional areas to identify and develop a pipeline of talent to maintain business operations.
The initial term of the agreement expires December 31, 2031 with provisions to extend. At current production volume projections, the Company believes that it will fall short of its future annual volume commitments under the City Brewing and Rauch agreements and will incur shortfall fees.
The initial term of the agreement expires December 31, 2031 with provisions to extend. 9 At current production volume projections, the Company believes that it will fall short of its future annual volume commitments under the City Brewing and Rauch agreements and will incur shortfall fees.
The Company sells its products predominantly in the United States, but also has markets in Canada, Mexico and other international markets. With few exceptions, the Company’s products are not the primary brands in its Distributors’ portfolios.
The Company sells its products predominantly in the United States, but also has markets in Canada, Mexico and other international markets. 6 With few exceptions, the Company’s products are not the primary brands in its Distributors’ portfolios.
Imported beers, such as Modelo Especial®, Corona®, Heineken®, and Stella Artois®, continue to compete aggressively in the United States and have gained market share over the last ten years.
Imported beers, such as Modelo Especial®, Corona®, Heineken®, Guinness®, and Stella Artois®, continue to compete aggressively in the United States and have gained market share over the last ten years.
The 2024 North American barley crop, which will support 2025 malt needs, was generally consistent with historical long-term averages with regard to both quality and quantity. The Company purchased most of the malt used in the production of its beers from four suppliers during 2024.
The 2025 North American barley crop, which will support 2026 malt needs, was generally consistent with historical long-term averages with regard to both quality and quantity. The Company purchased most of the malt used in the production of its beers from four suppliers during 2025.
The Company maintains competitive sources for most packaging materials and ingredients. In 2024, certain flavorings, crowns and labels were each supplied by a single source; however, the Company believes that, given time to adjust, alternative suppliers are available. The most significant packaging and ingredients include: Cans .
The Company maintains competitive sources for most packaging materials and ingredients. In 2025, certain flavorings, crowns and labels were each supplied by a single source; however, the Company believes that, given time to adjust, alternative suppliers are available. The most significant packaging and ingredients include: Cans .
Since 2020, the Company has not had any significant disruptions in its supply of glass and the Company currently believes that it will have a sufficient supply of glass in 2025. Malt. The two-row varieties of barley used in the Company’s malt are mainly grown in the United States and Canada.
Since 2020, the Company has not had any significant disruptions in its supply of glass and the Company currently believes that it will have a sufficient supply of glass in 2026. Malt. The two-row varieties of barley used in the Company’s malt are mainly grown in the United States and Canada.
Thus, the Company, in addition to competing with other beverages for a share of the drinker’s business, competes with other beverage companies for a share of the Distributor’s attention, time and selling efforts. During 2024, the Company’s largest individual Distributor accounted for approximately 3% of the Company’s gross sales.
Thus, the Company, in addition to competing with other beverages for a share of the drinker’s business, competes with other beverage companies for a share of the Distributor’s attention, time and selling efforts. During 2025, the Company’s largest individual Distributor accounted for approximately 3% of the Company’s gross sales.
In 2024, these apples were sourced primarily from Europe and the United States and include bittersweet apples from France and culinary apples from Italy, Washington State and New York. Purchases and commitments are denominated in Euros for European apples and US Dollars for American apples.
In 2025, these apples were sourced primarily from Europe and the United States and include bittersweet apples from France and culinary apples from Italy, Washington State and New York. Purchases and commitments are denominated in Euros for European apples and US Dollars for American apples.
Hard seltzers are typically priced competitively with Traditional beer and Beyond beer and may compete for drinkers with beer, wine, spirits, or FMBs. Some of these competitors include Mark Anthony Brands under the brand name “White Claw” and "White Claw Surge."; ABInBev under “Bud Light Seltzer”, and Molson Coors under “Vizzy Hard Sparkling Water” and "Topo Chico".
Hard seltzers are typically priced competitively with Traditional beer and Beyond beer and may compete for drinkers with beer, wine, spirits, or FMBs. Some of these competitors include Mark Anthony Brands under the brand name “White Claw” and "White Claw Surge."; AB InBev under “Bud Light Seltzer”, and Molson Coors under “Vizzy Hard Sparkling Water” and "Topo Chico".
The Company is the second largest supplier in Beyond beer at a 21% market share. 3 The Company’s business goal is to grow market share in the US Beer Market by creating and offering high quality alcohol beverages.
The Company is the second largest supplier in Beyond beer at a 20% market 3 share. The Company’s business goal is to grow market share in the US Beer Market by creating and offering high quality alcohol beverages.
These brands include Twisted Tea, a flavored malt beverage introduced in 2001, Angry Orchard, a hard cider introduced in 2011, Truly Hard Seltzer, a hard seltzer introduced in 2016 and Sun Cruiser, a vodka spirits RTD introduced in 2024. In 2024, approximately 85% of the Company’s 2024 volume is in Beyond beer with the remainder in Traditional beer.
These brands include Twisted Tea, a flavored malt beverage introduced in 2001, Angry Orchard, a hard cider introduced in 2011, Truly Hard Seltzer, a hard seltzer introduced in 2016 and Sun Cruiser, a vodka spirits RTD introduced in 2024. In 2025, approximately 86% of the Company’s volume is in Beyond beer with the remainder in Traditional beer.
These payments are being expensed over the terms of the agreements. Currently, certain of these production services agreements expire on December 31, 2025 and others on December 31, 2028. The Company has the contractual right to extend its agreements with City Brewing beyond the current termination dates on an annual basis through December 31, 2035.
These payments are being expensed over the terms of the agreements. Currently, certain of these production services agreements expire on December 31, 2028. The Company has the contractual right to extend its agreements with City Brewing beyond the current termination dates on an annual basis through December 31, 2035.
The Company currently has production services agreements with subsidiaries of City Brewing Company, LLC (“City Brewing”). During 2024 and 2023, City Brewing supplied approximately 26% and 22%, respectively, of the Company’s annual domestic shipment volume. In accordance with the production services agreements, the Company has paid to City Brewing for capital improvements at its facilities and other pre-payments.
The Company currently has production services agreements with subsidiaries of City Brewing Company, LLC (“City Brewing”). During 2025 and 2024, City Brewing supplied approximately 14% and 26%, respectively, of the Company’s annual domestic shipment volume. In accordance with the production services agreements, the Company has paid to City Brewing for capital improvements at its facilities and other pre-payments.
During 2020 and 2021, the Company experienced some supply chain constraints in packaging materials, primarily cans, that impacted the Company’s production schedules and increased can costs as a result of using a more expensive can supplier. The Company enters into limited-term supply agreements with certain vendors in order to receive preferential pricing.
Prior to 2023, the Company experienced some supply chain constraints in packaging materials, primarily cans, that impacted the Company’s production schedules and increased can costs as a result of using a more expensive can supplier. The Company enters into limited-term supply agreements with certain vendors in order to receive preferential pricing.
These investments were made to drive efficiencies and cost reductions and support product innovation. Based on its current estimates of future volumes and mix, the Company expects to invest between $90 million and $110 million in 2025 to meet those estimates.
These investments were made to drive efficiencies and cost reductions and support product innovation. Based on its current estimates of future volumes and mix, the Company expects to invest between $70 million and $90 million in 2026 to meet those estimates.
The majority of the promotional and distribution efforts for the Truly brand family in 2024 were focused on sleek can variety packages which include, Truly Berry Mix Pack, Truly Party Pack, Truly Unruly Mix Pack, Truly Citrus Mix Pack, Truly Lemonade Seltzer Mix Pack and Truly Fruit Punch Mix Pack.
The majority of the promotional and distribution efforts for the Truly brand family in 2025 were focused on sleek can variety packages which include, Truly Berry Mix Pack, Truly Party Pack, Truly Unruly Mix Pack, Truly Citrus Mix Pack, Truly Lemonade Seltzer Mix Pack and Truly Unruly Lemonade Mix Pack.
The Company’s Executive Leadership Team (“ELT”) is comprised of the Company's CEO and seven of his direct reports who collectively have management responsibility for the Company's primary business areas, including but not limited to brewing, supply chain operations, sales, marketing, finance, legal, and people and culture.
The Company’s Executive Leadership Team (“ELT”) is comprised of the Company's CEO and eight leaders who collectively have management responsibility for the Company's primary business areas, including but not limited to brewing, supply chain operations, sales, marketing, finance, legal, and people and culture.
During each of the years ended December 28, 2024 and December 30, 2023, the Company produced approximately 74% of its domestic volume at Company-owned breweries. In the normal course of its business, the Company has historically entered into various production arrangements with other production companies.
During each of the years ended December 27, 2025 and December 28, 2024, the Company produced approximately 86% and 74%, respectively of its domestic volume at Company-owned breweries. In the normal course of its business, the Company has historically entered into various production arrangements with other production companies.
The Company’s Dogfish Head Canned Cocktails and Sun Cruiser compete in the spirits RTDs category. This category is small and highly competitive and includes large international and domestic competitors, as well as many small regional and local distilling companies. Spirits RTDs are typically higher priced and may compete for drinkers with beer, wine, spirits, or FMBs.
The Company’s Sun Cruiser brand competes in the spirits RTDs category. This category is growing and highly competitive and includes large international and domestic competitors, as well as many small regional and local distilling companies. Spirits RTDs are typically higher priced and may compete for drinkers with beer, wine, spirits, or FMBs.
As of December 28, 2024, the balance of the note receivable is $16.7 million and the final maturity date is December 31, 2028. In December of 2024 the Company entered into an amendment and restatement in its entirety of an existing production agreement with a third-party supplier, Rauch North America Inc ("Rauch").
As of December 27, 2025, the balance of the note receivable is $11.2 million and the final maturity date is December 31, 2028. In December of 2024 the Company entered into an amendment and restatement in its entirety of an existing production agreement with a third-party supplier, Rauch North America Inc ("Rauch").
In addition, Monster acquired CaNarchy Craft Brewery Collective in early 2022 and launched the Beast Unleashed, a new brand of flavored malt beverages in early 2023 which includes Nasty Beast Hard Tea. Monster is planning to launch a new hard lemonade named Blind Lemon in early 2025.
In addition, Monster acquired CANarchy Craft Brewery Collective in early 2022 and launched the Beast Unleashed, a new brand of flavored malt beverages in early 2023 which includes Nasty Beast Hard Tea and Blind Lemon Hard Lemonade.
These styles are offered in various can, bottle and keg packages. The Dogfish Head brand also releases a variety of specialty package and draft beers brewed in limited quantities at its Dogfish Head Brewings and Eats and Milton Brewery tasting room locations.
The Company offers over twenty-five styles of beer in the Dogfish Head brand family. These styles are offered in various can, bottle and keg packages. The Dogfish Head brand also releases a variety of specialty package and draft beers brewed in limited quantities at its Dogfish Head Brewings and Eats and Milton Brewery tasting room locations.
Truly Hard Seltzer brand beverages are primarily packaged in sleek cans and Twisted Tea brand beverages are primarily packaged in standard cans. In 2024, approximately 79% of the Company’s total volume was packaged in cans and the Company expects that percentage to increase further in 2025.
Twisted Tea brand beverages are primarily packaged in standard cans and Truly Hard Seltzer and Sun Cruiser brand beverages are primarily packaged in sleek cans. In 2025, approximately 82% of the Company’s total volume was packaged in cans and the Company expects that percentage to increase further in 2026.
Arizona, after earlier development and launch in 2020 in Canadian markets, launched Arizona Hard Tea in the United States beginning in 2023. The Company’s Twisted Tea beverages compete generally within the FMB category of Beyond beer. FMBs, such as Twisted Tea, Mike’s Hard Lemonade, Smirnoff Ice, Cayman Jack, Clubtails, Beast Unleashed, Bud Light Lime, Redd’s Apple Ale, Seagrams Escapes.
Arizona, after earlier development and launch in 2020 in Canadian markets, launched Arizona Hard Tea in the United States beginning in 2023. 10 The Company’s Twisted Tea beverages compete within the Beyond Beer FMB category, which includes brands such as Twisted Tea, Mike’s Hard Lemonade, Smirnoff Ice, Cayman Jack, Clubtails, Beast Unleashed, Bud Light Lime, Redd’s Apple Ale, and Seagram’s Escapes.
Coke has entered into agreements with Molson Coors to develop, market and sell Topo Chico brand Hard Seltzer, Simply Spiked Lemonade, and Peace Hard Tea. Coke also announced agreements with Constellation Brands to develop, market and sell FRESCA™ Mixed and with Brown Forman to develop, market and sell Jack Daniel's® Tennessee Whiskey and Coca-Cola®™ Ready-to-Drink Cocktail.
Coke has entered into agreements with Molson Coors to develop, market and sell Topo Chico brand Hard Seltzer, Simply Spiked Lemonade, and Peace Hard Tea. Coke also announced separate agreements with two leading Spirits brands, Sazerac Company and Brown Forman to market and sell FRESCA™ Mixed and Jack Daniel's® Tennessee Whiskey and Coca-Cola®™ Ready-to-Drink Cocktail, respectively.
Since 2020, the Company has not had any significant disruptions in its supply of cardboard and the Company currently believes that it will have a sufficient supply of cardboard wraps in 2025. Glass. Some of the Company’s beverages are sold in glass bottles.
The Company’s beverages are packaged primarily in cardboard wraps, carriers and cardboard shipping cases. Since 2020, the Company has not had any significant disruptions in its supply of cardboard and the Company currently believes that it will have a sufficient supply of cardboard wraps in 2026. Glass. Some of the Company’s beverages are sold in glass bottles.
The Company expenses the shortfall fees during the contractual period when such fees are incurred as a component of cost of goods sold. During 2024 and 2023, the Company recorded $13.0 million and $9.5 million, respectively, in shortfall fees.
The Company expenses the shortfall fees during the contractual period when such fees are incurred as a component of cost of goods sold. During 2025 and 2024, the Company recorded $21.4 million and $13.0 million, respectively, in shortfall fees.
The Company’s Truly Hard Seltzer beverages compete primarily within the hard seltzer category of Beyond beer. This category grew quickly from 2016 to 2021 and then declined in 2022, 2023 and 2024. The hard seltzer category is highly competitive and includes large international and domestic competitors.
The Company’s Truly Hard Seltzer beverages compete primarily within the hard seltzer category of Beyond beer. This category grew quickly from 2016 to 2021 and then declined each year since 2021. The hard seltzer category is highly competitive and includes large international and domestic competitors.
As of December 28, 2024, if volume for the remaining term of the production arrangements was zero, the total contractual shortfall and termination fees, with advance notice as specified in the related contractual agreements, would total approximately $37 million with $27 million due in 2025 and $10 million due in future years thereafter.
As of December 27, 2025, if volume for the remaining term of the production arrangements was zero, the total contractual shortfall and termination fees, with advance notice as specified in the related contractual agreements, would total approximately $26 million with $15 million due in 2026 and $11 million due in future years thereafter.
The Hard Seltzer category is $3.1 billion in measured off-premise channels and comprises approximately 30% of Beyond beer and the hard seltzer category declined in dollars approximately 16% in 2023 and 8% in 2024. The Company offers over thirty styles of hard seltzer in the Truly Hard Seltzer brand family, most of which are available nationally in the United States.
The Hard Seltzer category is $3.0 billion in measured off-premise channels and comprises approximately 28% of Beyond beer and the hard seltzer category declined in dollars approximately 8% in 2024 and 4.5% in 2025. 4 The Company offers over thirty styles of hard seltzer in the Truly Hard Seltzer brand family, most of which are available nationally in the United States.
Sleek cans, standard cans and bottles are sold primarily for off-premise retailers, which include grocery stores, club stores, convenience stores, liquor stores, and other traditional and e-commerce retail outlets. Kegs are sold primarily for on-premise retailers, which include bars, restaurants, stadiums and other venues.
The Company sells its beverages in various packages. Sleek cans, standard cans and bottles are sold primarily for off-premise retailers, which include grocery stores, club stores, convenience stores, liquor stores, and other traditional and e-commerce retail outlets. Kegs are sold primarily for on-premise retailers, which include bars, restaurants, stadiums and other venues.
The Company competes for a share of the Distributor’s attention, time and selling efforts. At retail, the Company competes for traditional retail shelf, cold box and tap space, as well as e-commerce placement. From a drinker perspective, competition exists for brand acceptance and loyalty.
At retail, the Company competes for traditional retail shelf, cold box and tap space, as well as e-commerce placement. From a drinker perspective, competition exists for brand acceptance and loyalty.
With the exception of certain specialty and distilled products, the Company includes a clearly legible “freshness” date on every bottle, can and keg of its beverages, in order to ensure that its drinkers enjoy only the freshest products. Boston Beer was the first American brewer to use this practice.
With the exception of certain specialty and distilled products, the Company includes a clearly legible “freshness” date on every bottle, can and keg of its beverages, in order to ensure that its drinkers enjoy only the freshest products.
During 2022, 2023 and 2024 the Company did not have any significant disruptions in its can supply and the Company currently believes that it will have a sufficient supply of cans in 2025. Flavorings and Fruit Juice. The Company’s beverages include many unique and proprietary flavors and combinations of flavors and most of these flavorings are single sourced.
Since 2022, the Company has not had any significant disruptions in its can supply and the Company currently believes that it will have a sufficient supply of cans in 2026. Flavorings. The Company’s beverages include many unique and proprietary flavors and combinations of flavors and most of these flavorings are single sourced.
At current volume projections, the Company anticipates that it will recognize approximately $30 million of shortfall fees in future years with $14 million forecasted to be expensed in 2025 and the remainder expected to be expensed primarily in 2026.
At current volume projections, the Company anticipates that it will recognize approximately $19 million of shortfall fees in future years with $6 million forecasted to be expensed in 2026 and $13 million expected to be expensed in years thereafter.
Production and retail activities at the Company's local breweries and tap rooms are mainly for brewing and packaging beers for retail sales on site at tap rooms and gift shops, restaurant activities, developing innovative and traditional beers and in some cases supporting draft and package accounts in the respective local market areas.
Production and retail activities at the Company's local breweries and tap rooms are mainly for brewing and packaging beers for retail sales on site at tap rooms and gift shops, restaurant activities and developing innovative and traditional beers.
The Company currently expects that the percentage of total domestic production at third-party production facilities will be approximately 20% in 2025.
The Company currently expects that the percentage of total domestic production at third-party production facilities will be less than 10% in 2026.
Trademarks The Company has obtained trademark registrations with the United States Patent and Trademark Office for over 400 trademarks, including Samuel Adams®, Sam Adams®, Twisted Tea®, Truly®, Truly Hard Seltzer®, Angry Orchard®, Dogfish Head®, Coney Island®, and Angel City Brewery®. It also has a number of common law trademarks.
Trademarks The Company has obtained trademark registrations with the United States Patent and Trademark Office for over 400 trademarks, including Samuel Adams®, Sam Adams®, Twisted Tea®, Truly®, Truly Hard Seltzer®, Angry Orchard®, and Dogfish Head®. It also has a number of common law trademarks. Several Company trademarks are also registered or have registrations pending in various foreign countries.
In recent years, wine and spirits have been competing more directly with beers. The Company monitors such activity and attempts to develop strategies which benefit from the drinker’s interest in trading up, in order to position its beverages competitively with wine and spirits. The Company competes with other beer and alcoholic beverage companies within a three-tier distribution system.
The Company monitors such activity and attempts to develop strategies which benefit from the drinker’s interest in trading up, in order to position its beverages competitively with wine and spirits. The Company competes with other beer and alcoholic beverage companies within a three-tier distribution system. The Company competes for a share of the Distributor’s attention, time and selling efforts.
Production Strategy The Company continues to pursue a production strategy that includes production at breweries owned by the Company and production facilities owned by others. The Company made capital investments in 2024 of approximately $76.8 million, most of which represented investments in breweries owned by the Company.
The Company was the first American brewer to use this practice. 8 Production Strategy The Company continues to pursue a production strategy that includes production at breweries owned by the Company and production facilities owned by others. The Company made capital investments in 2025 of approximately $54.5 million, most of which represented investments in breweries owned by the Company.
States levy excise taxes at varying rates based on the type of beverage and alcohol content. Failure by the Company to comply with applicable federal, state or local laws and regulations could result in higher taxes, penalties, fees and suspension or revocation of permits, licenses or approvals.
Failure by the Company to comply with applicable federal, state or local laws and regulations could result in higher taxes, penalties, fees and suspension or revocation of permits, licenses or approvals.
The Company has certain competitive advantages over other brewers and competitors, including a long history of awards for product quality, greater available resources and the ability to distribute and promote its products on a more cost-effective basis.
The Company closely monitors these and other trends in its Distributor network and works to develop programs and tactics intended to best position its products in the market. 11 The Company has certain competitive advantages over other brewers and competitors, including a long history of awards for product quality, greater available resources and the ability to distribute and promote its products on a more cost-effective basis.
Business General The Boston Beer Company, Inc. and certain subsidiaries (the “Company”) are engaged in the business of selling alcohol beverages throughout the United States and in selected international markets, under the trademarks “The Boston Beer Company®”, “Twisted Tea Brewing Company®”, “Hard Seltzer Beverage Company”, “Angry Orchard® Cider Company”, “Dogfish Head® Craft Brewery”, “Dogfish Head Distilling Co.”, “Angel City® Brewing Company”, “Coney Island® Brewing Company”, "Green Rebel Brewing Co.", “TeaPot Worldwide”, and “Sun Cruiser Beverage Co." The Company produces alcohol beverages, including flavored malt beverages, hard seltzer, beer, hard cider, spirits based ready to drink beverages (“spirits RTDs”) and distilled spirits at Company-owned breweries and its cidery and under contract arrangements at other production facilities.
Business General The Boston Beer Company, Inc. and certain subsidiaries (the “Company”) are engaged in the business of selling alcohol beverages throughout the United States and in selected international markets, under the trade names “The Boston Beer Company®”, “Twisted Tea Brewing Company®”, “Hard Seltzer Beverage Company”, “Angry Orchard® Cider Company”, “Dogfish Head® Craft Brewery”, “Dogfish Head Distilling Co.”, “Angel City® Brewing Company”, “Coney Island® Brewing Company”, "Green Rebel Brewing Co.", “TeaPot Worldwide”, “Sun Cruiser Beverage Co.","American Fermentation Company LLC", and "Sinless Spirits Company".
These contracts generally result in increased competition among brewers as the contracts may affect the manner in which a Distributor allocates selling effort and investment to the brands included in its portfolio. The Company closely monitors these and other trends in its Distributor network and works to develop programs and tactics intended to best position its products in the market.
These contracts generally result in increased competition among brewers as the contracts may affect the manner in which a Distributor allocates selling effort and investment to the brands included in its portfolio.
The hard cider category is $0.5 billion in measured off-premise channels and comprises approximately 5% of Beyond beer and the cider category in dollars increased 2% in 2023 and declined 2% in 2024. This category is small and highly competitive and the competition consists mostly of many small regional and local hard cider companies.
The hard cider category is $0.5 billion in measured off-premise channels and comprises approximately 4% of Beyond beer and the cider category in dollars declined 2% in 2024 and increased 4% in 2025.
This led to improved customer service levels and significantly fewer out of stocks but resulted in write-offs of excess inventory at the Company’s breweries and warehouses. During 2023, the Company significantly improved its supply chain functions which led to reduced inventories internally and at distributors, while improving customer service levels and significantly reducing write-offs of excess inventory.
These levels are designed to result in high customer service levels, limit distributor and retailer out of stocks and reduce the risk of inventory obsolescence. Since 2023, the Company significantly improved its supply chain functions which led to reduced inventories internally and at distributors, while improving customer service levels and significantly reducing write-offs of excess inventory.
The top tier rate on hard cider (with alcohol by volume of 8.5% or less) is $0.226 per gallon, on hard cider (with non-qualifying fermentable fruits) is $1.07 per gallon, on artificially carbonated wine (hard cider with high CO2 levels) is $3.30 per gallon, and on distilled spirits is $13.50 per proof gallon.
The top tier rate on hard cider (with alcohol by volume of less than 8.5%) is $0.226 per gallon, on still wine (with non-qualifying fermentable fruits) is $1.07 per gallon, and on distilled spirits is $13.50 per proof gallon. States levy excise taxes at varying rates based on the type of beverage and alcohol content.
The Company currently offers over 7 styles of spirits RTDs under the Dogfish Head brand that are available in sleek can and sleek can variety packages. The Sun Cruiser brand was launched in early 2024.
The Company currently offers over 7 styles of spirits RTDs under the Dogfish Head brand that are available in sleek can and sleek can variety packages. Angry Orchard Hard Cider The Company’s Angry Orchard ciders compete within the hard cider category.
Most styles are available in sleek cans and some are available in 24 ounce cans. In 2024, the Company introduced Truly Unruly, an 8% ABV hard seltzer in a sleek can variety pack. In 2024, Truly Unruly was the top growth driver among higher ABV brands in the US Beer Market.
Most styles are available in sleek cans and some are available in 24 ounce cans. In 2024, the Company introduced Truly Unruly, an 8% ABV hard seltzer in a sleek can variety pack. Truly Unruly grew in 2025 and the Company expects Truly Unruly to continue to grow in 2026.
The Company has a strong history of innovation and has internally developed brands outside of the craft beer category that are among the leaders in their respective categories.
Description of the Company’s Business The Company was founded in 1984 as a craft brewery and competes in the craft beer category primarily with its Samuel Adams and Dogfish Head brands. The Company has a strong history of innovation and has internally developed brands outside of the craft beer category that are among the leaders in their respective categories.
The Company began selling limited quantities of cannabis beverage products in Canada under the TeaPot brand during the second half of 2022. In late 2024, the Company began the launch of a new cannabis beverage brand of hand-crafted non-alcoholic cannabis cocktails named Emerald Hour.
The Company began selling limited quantities of cannabis beverage products in Canada under the TeaPot brand during the second half of 2022. In late 2024, the Company began the launch of a new cannabis beverage and gummy brand named Emerald Hour. The Company currently does not have plans to produce or sell any cannabis products outside of Canada.
In addition, the Company owns an apple orchard and cidery located in Walden, New York (the “Orchard” and “Cidery”), a restaurant in Rehoboth, Delaware (“Chesapeake & Maine”) and a boutique inn in Lewes, Delaware (the “Dogfish Inn”). The Company sells its beverages in various packages.
The Company announced it will close its local brewery in Los Angeles, California (the “Angel City Brewery") effective April 30, 2026. In addition, the Company owns an apple orchard and cidery located in Walden, New York (the “Orchard” and “Cidery”), a restaurant in Rehoboth, Delaware (“Chesapeake & Maine”) and a boutique inn in Lewes, Delaware (the “Dogfish Inn”).
The Samuel Adams brand also releases a variety of specialty package and draft beers brewed in limited quantities at its Samuel Adams Downtown Boston Tap Room, Samuel Adams Boston Brewery Tap Room, and Samuel Adams Cincinnati Brewery Tap Room. The Company offers over twenty-five styles of beer in the Dogfish Head brand family.
Most Samuel Adams beers are available nationally in various bottle, standard can, and keg packages. The Samuel Adams brand also releases a variety of specialty package and draft beers brewed in limited quantities at its Samuel Adams Downtown Boston Tap Room, Samuel Adams Boston Brewery Tap Room, and Samuel Adams Cincinnati Brewery Tap Room.
Product Innovations The Company has a proven track record of innovation and building new brands and is committed to maintaining its position as a leading innovator. To that end, the Company continually tests new alcohol beverages and may sell them under various brand labels for evaluation of drinker interest.
To that end, the Company continually tests new alcohol beverages and may sell them under various brand labels for evaluation of drinker interest.
The Company is not aware of any trademark infringements that could materially affect its current business or any prior claim to the trademarks that would prevent the Company from using such trademarks in its business. The Company’s policy is to pursue registration of its marks whenever appropriate and to oppose infringements of its marks through available enforcement options.
The Company regards its trademarks as having substantial value and as being an important factor in the marketing of its products. The Company is not aware of any trademark infringements that could materially affect its current business or any prior claim to the trademarks that would prevent the Company from using such trademarks in its business.
The Company also operates three smaller local breweries that are mainly focused on brewing and packaging beers for retail sales on site at tap rooms and gift shops, restaurant activities, developing innovative and traditional beers and in some cases, supporting draft and package accounts in the respective local market areas.
The Company also operates smaller local breweries that are mainly focused on brewing and packaging beers for retail sales on site at tap rooms and gift shops, restaurant activities and developing innovative and traditional beers. These two ongoing local breweries are located in Boston, Massachusetts (the “Samuel Adams Boston Downtown Tap Room”) and Rehoboth, Delaware (“Dogfish Head Brewings and Eats”).
The Company’s sales organization is designed to develop and strengthen relations at the Distributor, retailer and drinker levels by providing educational and promotional programs. The Company’s sales force has a high level of product knowledge and is trained in the details of the brewing and selling processes.
Boston Beer has a sales force of over 550 people, which the Company believes is one of the largest in the US Beer Market industry. The Company’s sales organization is designed to develop and strengthen relations at the Distributor, retailer and drinker levels by providing educational and promotional programs.
The Company offers over ten styles of hard cider in the Angry Orchard brand family, most of which are available nationally in the United States in various bottle, can, and keg packages. The majority of the promotional and distribution efforts for the Angry Orchard brand family are focused on Angry Orchard Crisp Apple.
This category is small and highly competitive and the competition consists mostly of many small regional and local hard cider companies. 5 The Company offers over ten styles of hard cider in the Angry Orchard brand family, most of which are available nationally in the United States in various bottle, can, and keg packages.
Twisted Tea The Company’s Twisted Tea products generally compete within the flavored malt beverage (“FMB”) category of Beyond beer. The FMB category is $4.6 billion in measured off-premise channels and comprises approximately 45% of Beyond beer and the FMB category grew in dollars approximately 20% in 2023 and 6% in 2024.
The FMB category is $4.5 billion in measured off-premise channels and comprises approximately 42% of Beyond beer and the FMB category grew in dollars approximately 6% in 2024 and declined 4% in 2025.
The Dogfish Head brand began in 1995 and is recognized as one of the most innovative and respected craft beer and spirits brand with a particular focus on India Pale Ales (“IPAs”) and spirits RTDs. In addition to its primary brands, the Company has two local brands, Angel City® and Coney Island®, that primarily focus on local distribution.
The Sun Cruiser brand was launched in 2024 and has grown quickly to be the fifth largest spirits RTD brand. The Dogfish Head brand began in 1995 and is recognized as one of the most innovative and respected craft beer and spirits brand with a particular focus on India Pale Ales (“IPAs”).
In the first quarter of 2025, the Company is planning to launch Truly Unruly Lemonade Mix Pack, Sun Cruiser vodka based lemonade and Dogfish Head Grateful Dead Juicy Pale Ale. During the rest of 2025, the Company has plans to add new brands, new beverage styles and may reformulate existing styles of beverages.
In the first quarter of 2026, the Company is planning to expand Sinless Vodka Cocktails into additional states, launch Twisted Tea Extreme Variety Pack, Samuel Adams Cherry Bomb Ale and Dogfish Head Grateful Dead Citrus Daydream Lager. During the rest of 2026, the Company has plans to add new brands, new beverage styles and may reformulate existing styles of beverages.
In 2016, the Company began national distribution of the Truly Hard Seltzer brand and it maintained its place as one of the leading brands in the hard seltzer category in 2024.
The Twisted Tea brand family was first introduced in 2001 and since 2022, Twisted Tea has been the largest selling flavored malt beverage brand in the United States. In 2016, the Company began national distribution of the Truly Hard Seltzer brand and it maintained its place as one of the leading brands in the hard seltzer category in 2025.
This category grew rapidly in the early stages of its development and is highly competitive and includes large international and domestic competitors as well as many smaller national, regional and local hard seltzer companies. Beginning in the latter half of 2021 and continuing into 2023, the category saw sharp declines in volume.
Truly Hard Seltzer The Company’s Truly Hard Seltzer brand generally competes within the hard seltzer category. This category is highly competitive and includes large international and domestic competitors as well as many smaller national, regional and local hard seltzer companies. The category grew rapidly from 2018 to 2021. Since 2021, the category has seen significant declines in volume.
The Samuel Adams Seasonal program of beers was originally introduced in the late 1980’s and includes various limited availability seasonal beers and variety packs. Samuel Adams American Light was introduced in 2024 and is made with high quality American ingredients and recently earned the title of Best Light Beer in America in the World Beer Awards.
Samuel Adams Boston Lager® is the Company’s flagship beer that was introduced in 1984. The Samuel Adams Seasonal program of beers was originally introduced in the late 1980’s and includes various limited availability seasonal beers and variety packs.
Truly Hard Seltzer and Twisted Tea brand beverages are particularly reliant on the use of flavorings and a variety of flavors as part of their appeal to drinkers.
Truly Hard Seltzer and Twisted Tea brand beverages are particularly reliant on the use of flavorings and a variety of flavors as part of their appeal to drinkers. The Company is working closely with various flavoring suppliers to ensure it has an adequate supply and currently believes that it will have sufficient supply of flavorings in 2026. 7 Cardboard .
Some of these Spirits-based Canned Cocktails competitors include; ABInBev under the brand name "Cutwater" and Diageo under the brand name "Crown Royal". The Company’s products also compete with other alcoholic beverages for drinker attention and consumption and the pace of innovation in the categories in which the Company competes is increasing.
The Company’s products also compete with other alcoholic beverages for drinker attention and consumption and the pace of innovation in the categories in which the Company competes is increasing. In recent years, wine and spirits have been competing more directly with beers.
During 2023 and 2024, the Company increased its promotional efforts related to Twisted Tea Light, and in 2023 and 2024, the style grew significantly off a relatively small base. In 2024, the Company launched in certain test markets, Twisted Tea Extreme, an 8% Alcohol By Volume ("ABV") flavored malt beverage in 2 styles, primarily sold in 24 ounce cans.
During 2024 and 2025, the Company increased its promotional efforts related to Twisted Tea Light and Twisted Tea Extreme, an 8% Alcohol By Volume ("ABV") flavored malt beverage launched during 2024. The Company expects Twisted Tea Light and Twisted Tea Extreme to be positive contributors for the Twisted Tea brand in 2026.
The Angry Orchard brand also releases a variety of specialty package and draft ciders fermented in limited quantities at its Company-owned Orchard and Cidery in Walden, New York. Dogfish Head Spirit RTDs and Sun Cruiser The Company’s Dogfish Head Canned Cocktails and Sun Cruiser brands compete in the spirits RTD category.
The majority of the promotional and distribution efforts for the Angry Orchard brand family are focused on Angry Orchard Crisp Apple, Angry Orchard Crisp Imperial and Angry Orchard Seasonal Variety Packs. The Angry Orchard brand also releases a variety of specialty package and draft ciders fermented in limited quantities at its Company-owned Orchard and Cidery in Walden, New York.
The Company’s most significant innovations in 2024 were the introduction of the Sun Cruiser brand, a new iced tea vodka based RTD, as well as the launch of Truly Unruly Mix Pack and Twisted Tea Extreme. Also, in 2024 the Company launched Samuel Adams American Light.
The Company’s most significant innovations in 2025 were the introduction of new Sun Cruiser styles and packages including Sun Cruiser vodka based lemonade, as well as the launch of Truly Unruly Lemonade Mix Pack, Dogfish Head Grateful Dead Juicy Pale Ale and Sinless Vodka Cocktails, a new spirits RTD brand.
The Pennsylvania Brewery, the Cincinnati Brewery and the Milton Brewery produced most of the Company’s shipment volume from Company owned breweries during 2024. The Pennsylvania Brewery is the Company’s largest brewery.
Because actual capital investments are highly dependent on meeting demand, the actual amount spent may well be significantly different from the Company’s current expectations. The Pennsylvania Brewery, the Cincinnati Brewery and the Milton Brewery produced most of the Company’s shipment volume from Company owned breweries during 2025. The Pennsylvania Brewery is the Company’s largest brewery.
The remaining net book value of these third-party production prepayments is $14.5 million at December 28, 2024 of which $10.3 million is expected to be expensed to cost of goods sold during 2025 and the remainder thereafter. 9 These agreements include minimum capacity availability commitments by City Brewing and the Company is obligated to meet annual minimum volume commitments and is subject to contractual shortfall fees, if these annual minimum volume commitments are not met.
These agreements include minimum capacity availability commitments by City Brewing and the Company is obligated to meet annual minimum volume commitments and is subject to contractual shortfall fees, if these annual minimum volume commitments are not met.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Regulatory changes in response to public attitudes could adversely affect the Company’s business. The alcoholic beverage industry has been the subject of considerable societal and political attention for several years, due to public concern over alcohol-related social problems, including driving under the influence, underage drinking and health consequences from the misuse of alcohol, including alcoholism.
Regulatory changes in response to public attitudes could adversely affect the Company’s business. The alcoholic beverage industry has been the subject of considerable societal and political attention for several years, due to public concern over alcohol-related social problems, including driving under the influence, underage drinking and health consequences from alcohol and the misuse of alcohol, including alcoholism.
Volatility, uncertainty, and inflation in the financial markets and economic conditions generally may directly or indirectly affect the Company’s performance and operating results in a variety of ways, including: (a) prices for energy, labor, packaging, ingredients, and agricultural products may rise faster than current estimates, including increases resulting from currency fluctuations; (b) the Company’s key suppliers may not be able to fund their capital requirements, resulting in disruption in the supplies of the Company’s raw and packaging materials; (c) the credit risks of the Company’s Distributors may increase; (d) the impact of currency fluctuations on amounts owed to the Company by distributors that pay in foreign currencies; (e) the Company’s credit facility, or portion thereof, may become unavailable at a time when needed by the Company to meet critical needs; (f) overall alcoholic beverage consumption may decline; or (g) drinkers of the Company’s products may change their purchase preferences and frequency, which might result in sales declines.
Volatility, uncertainty, and inflation in the financial markets and economic conditions generally may directly or indirectly affect the Company’s performance and operating results in a variety of ways, including: (a) prices for energy, labor, packaging, ingredients, and agricultural products may rise faster than current estimates, including increases resulting from currency fluctuations; (b) the Company’s key suppliers may not be able to fund their capital requirements, resulting in disruption in the supplies of the Company’s raw and packaging materials; (c) the credit risks of the Company’s Distributors may increase; (d) currency fluctuations may impact amounts owed to the Company by distributors that pay in foreign currencies; (e) the Company’s credit facility, or portion thereof, may become unavailable at a time when needed by the Company to meet critical needs; (f) overall alcoholic beverage consumption may decline; or (g) drinkers of the Company’s products may change their purchase preferences and frequency, which might result in sales declines.
Nevertheless, should an interruption occur, the Company could experience temporary shortfalls in production and/or increased production and/or distribution costs and be required to make significant capital investments to secure alternative capacity for certain brands and packages, the combination of which could have a material adverse effect on the Company’s business and financial results.
Should an interruption occur, the Company could experience temporary shortfalls in production and/or increased production and/or distribution costs and be required to make significant capital investments to secure alternative capacity for certain brands and packages, the combination of which could have a material adverse effect on the Company’s business and financial results.
Imported beers, such as Modelo Especial®, Corona®, Heineken®, and Stella Artois®, continue to compete aggressively in the United States and have gained market share over the last ten years. Constellation Brands (owner of the United States distribution rights to Modelo Especial and Corona) and Heineken may have substantially greater financial resources, marketing strength and distribution networks than the Company.
Imported beers, such as Modelo Especial®, Corona®, Heineken®, Guinness®, and Stella Artois®, continue to compete aggressively in the United States and have gained market share over the last ten years. Constellation Brands (owner of the United States distribution rights to Modelo Especial and Corona) and Heineken may have substantially greater financial resources, marketing strength and distribution networks than the Company.
While new AI initiatives, laws, and regulations are emerging and evolving, uncertainty will remain, and the Company’s obligation to comply with the evolving regulatory landscape could entail significant costs, negatively affect the Company’s business, or limit the Company’s ability to incorporate certain AI capabilities into the Company’s business. An increase in energy costs could harm the Company’s financial results .
While new AI initiatives, laws, and regulations are emerging and evolving, uncertainty will remain, and the Company’s obligation to comply with the evolving regulatory landscape could entail significant costs, negatively affect the Company’s business, or limit the Company’s ability to incorporate certain AI capabilities into the Company’s business. 20 An increase in energy costs could harm the Company’s financial results .
In 2024, certain flavorings, crowns, and labels were each supplied by single sources. The loss of any of the Company’s packaging materials suppliers could, in the short-term, adversely affect the Company’s results of operations, cash flows and financial position until alternative supply arrangements were secured.
In 2024 and 2025, certain flavorings, crowns, and labels were each supplied by single sources. The loss of any of the Company’s packaging materials suppliers could, in the short-term, adversely affect the Company’s results of operations, cash flows and financial position until alternative supply arrangements were secured.
Changes in control or ownership within the current distribution network could lead to less support of the Company’s products. Contributing to distribution risk is the fact that the Company’s distribution agreements are generally terminable by the Distributor on relatively short notice.
Changes in control or ownership within the current distribution network could lead to less support of the Company’s products. 14 Contributing to distribution risk is the fact that the Company’s distribution agreements are generally terminable by the Distributor on relatively short notice.
Failure to attract and retain the right talent, or to manage the transition of responsibilities resulting from such turnover smoothly, would affect the Company's ability to meet its challenges and may cause the Company to miss performance objectives or financial targets.
Failure to attract and retain the right talent, or to manage the transition of responsibilities resulting from such turnover smoothly, would affect the Company's ability to meet its challenges and may cause the Company to miss performance objectives or financial 18 targets.
At the same time, despite making these expenditures and incurring these costs, if demand were to further increase above current volume estimates, the Company could still face the risk of not being able to meet the increased demand.
At the same time, despite making these expenditures and incurring these costs, if demand were to increase above current volume estimates, the Company could still face the risk of not being able to meet the increased demand.
If such damage were to occur, it would likely have a negative effect on the financial condition of the Company. 21 In addition to these inherent brand risks, C.
If such damage were to occur, it would likely have a negative effect on the financial condition of the Company. In addition to these inherent brand risks, C.
In an uncertain volume environment, the Company faces the risk of not being able to support the owned brewery operating costs, if volumes were to decline.
In an uncertain volume environment, the Company faces the risk of not being able to support the owned brewery operating costs, if volumes were to decline further.
In the United States, where approximately 95% of its beverages are sold, the Company sells most of its alcohol beverages to independent beer Distributors for distribution to retailers and, ultimately, to drinkers. Although the Company currently has arrangements with over 300 Distributors, sustained growth will require it to maintain such relationships and possibly enter into agreements with additional Distributors.
In the United States, where approximately 94% of its beverages are sold, the Company sells most of its alcohol beverages to independent beer Distributors for distribution to retailers and, ultimately, to drinkers. Although the Company currently has arrangements with over 300 Distributors, sustained growth will require it to maintain such relationships and possibly enter into agreements with additional Distributors.
Currently, the Company believes it can meet its volume targets in 2025 and return to volume growth in future years, but there is no guarantee its efforts will be successful or profitable. The Company’s inability to react to changes in demand could have a material adverse effect on the Company’s operations or financial results.
Currently, the Company believes it can meet its volume targets in 2026 and return to volume growth in future years, but there is no guarantee its efforts will be successful or profitable. The Company’s inability to react to changes in demand could have a material adverse effect on the Company’s operations or financial results.
Twisted Tea and Truly Hard Seltzer brand beverages are particularly reliant on the use of flavorings and variety of flavors as part of their appeal to drinkers. The Company purchased most of the malt used in the production of its beer from four suppliers during 2024.
Twisted Tea and Truly Hard Seltzer brand beverages are particularly reliant on the use of flavorings and variety of flavors as part of their appeal to drinkers. The Company purchased most of the malt used in the production of its beer from four suppliers during 2025.
Beginning in the second half of 2021, the market for hard seltzer products experienced decelerating growth trends, which contributed to the Company’s depletion volume decline of 5% in 2022, 6% in 2023 (5% decline on a 52-week comparable basis) and 2% in 2024.
Beginning in the second half of 2021, the market for hard seltzer products experienced decelerating growth trends, which contributed to the Company’s depletion volume decline of 5% in 2022, 6% in 2023 (5% decline on a 52-week comparable basis), 2% in 2024 and 4% in 2025.
As an outgrowth of these concerns, the possibility exists that advertising by alcoholic beverage producers could be restricted, that additional cautionary labeling or packaging requirements might be imposed, that further restrictions on the sale of alcohol might be imposed or that there may be renewed efforts to impose increased excise or other taxes on beer sold in the United States.
As an outgrowth of these concerns, the possibility exists that industry volumes could further decline, advertising by alcoholic beverage producers could be restricted, that additional cautionary labeling or packaging requirements might be imposed, that further restrictions on the sale of alcohol might be imposed or that there may be renewed efforts to impose increased excise or other taxes on beer sold in the United States.
The Company currently operates 9 retail locations where its beverages are sold and consumed on-premise, including six brewery tap rooms, an apple orchard and innovation cidery, a restaurant and a boutique inn.
The Company currently operates nine retail locations where its beverages are sold and consumed on-premise, including six brewery tap rooms, an apple orchard and innovation cidery, a restaurant and a boutique inn.
The Company purchases a substantial portion of the ingredients used in its beverages, including its flavorings, fruit juice, malt, hops, apples, and other ingredients, from a limited number of domestic and foreign suppliers.
The Company purchases a substantial portion of the ingredients used in its beverages, including its flavorings, malt, hops, apples, and other ingredients, from a limited number of domestic and foreign suppliers.
James Koch, the founder and Chairman of the Company, as well as the founders of Dogfish Head brand, Samuel Calagione, Founder and Brewer, Dogfish Head Brewery and Mariah Calagione, Founder and Communitarian, Dogfish Head Brewery, are an integral part of the Company’s history, brand equity and current and potential future brand messaging and the Company relies on the positive public perception of these founders.
James Koch, the founder, Chief Executive Officer and Chairman of the Company, as well as the founders of Dogfish Head brand, Samuel Calagione, Founder and Brewer, Dogfish Head Brewery and Mariah Calagione, Founder and Communitarian, Dogfish Head Brewery, are an integral part of the Company’s history, brand equity and current and potential future brand messaging and the Company relies on the positive public perception of these founders.
James Koch, who is the founder and Chairman of the Company, as the holder of 100% of the voting rights to the outstanding shares of the Company’s Class B Common Stock. As a result, Mr.
James Koch, who is the founder, Chairman and Chief Executive Officer of the Company, as the holder of 100% of the voting rights to the outstanding shares of the Company’s Class B Common Stock. As a result, Mr.
These costs include the destruction of excess inventory, provisions for excess and obsolete inventories, property, plant and equipment impairments, write-offs of third-party production prepayments and provisions for costs associated with the termination of various third-party production contracts. The Company is targeting a percentage change in shipments and depletion volume of between down single digits to up single digits.
These costs include the destruction of excess inventory, provisions for excess and obsolete inventories, property, plant and equipment impairments, write-offs of third-party production prepayments and provisions for costs associated with the termination of various third-party production contracts. In 2026, the Company is targeting a percentage change in shipments and depletion volume of between flat and down mid- single digits.
The potential for growth in the sales of flavored malt beverages, hard seltzers, domestic beers, imported beers and spirits RTDs is expected to increase the competition in the market for Beyond beer and Traditional beer occasions within the United States and, as a result, the Company may well face competitive pricing pressures and the demand for and market share of the Company’s products may fluctuate and possibly decline.
The potential for growth in the sales of flavored malt beverages, hard seltzers, domestic beers, imported beers and spirits RTDs is expected to increase the competition in the market for Beyond beer and Traditional beer occasions within the United States and, as a result, the Company may well face competitive pricing pressures and the demand for and market share of the Company’s products may fluctuate and possibly decline. 13 The Company’s products compete generally with other alcoholic beverages.
Mariah Calagione has recently announced her retirement from the Company effective during 2025. The role of these founders as founders, brewers, leaders or former leaders of the Company is emphasized as part of the Company’s brand communication and has appeal to some drinkers.
Mariah Calagione has recently retired from the Company effective during 2025. The role of these founders as founders, brewers, leaders or former leaders of the Company is emphasized as part of the Company’s brand communication and has appeal to some drinkers.
Also as noted above, during 2024, approximately 26% of the Company’s annual domestic shipment volume was produced under production service agreements with City Brewing Company, LLC and its subsidiaries.
Also as noted above, during 2025, approximately 14% of the Company’s annual domestic shipment volume was produced under production service agreements with City Brewing Company, LLC and its subsidiaries.
Several large non-alcoholic beverage companies including Coca-Cola Company (“Coke"), Pepsi, Monster Beverage Corporation (“Monster”) and Arizona Beverage Company ("Arizona") have entered the alcoholic beverage market directly or through licensing agreements with alcoholic beverage companies to develop alcohol versions of existing traditional non-alcohol brands.
Several large non-alcoholic beverage companies including Coke, Pepsi, Monster and Arizona have entered the alcoholic beverage market directly or through licensing agreements with alcoholic beverage companies to develop alcohol versions of existing traditional non-alcohol brands.
The Company attempts to mitigate production and distribution risks through a combination of owned breweries and access to third-party contract production facilities, but there is no guarantee that this strategy will be successful, and it might result in short term costs and inefficiencies which could adversely impact our business and financial results. 20 Turnover in Company leadership or other key positions may lead to loss of key knowledge or capability and adversely impact Company performance.
The Company attempts to mitigate production and distribution risks through a combination of owned breweries and access to third-party contract production facilities, but there is no guarantee that this strategy will be successful, and it might result in short term costs and inefficiencies which could adversely impact our business and financial results.
The slowdown in growth trends greatly impacted the Company's volume of production and shipments, as well as its volume projections for the future. The volume reduction also resulted in increased supply chain related costs.
The slowdown in growth trends greatly impacted the Company's volume of production and shipments, as well as its volume projections for the future. During 2021 through 2024, the volume reductions resulted in increased supply chain related costs.
During 2024, the Company produced approximately 74% of its domestic volume at breweries owned by the Company and, as noted above, anticipates producing 80% of its domestic volume at breweries owned by the Company in 2025.
During 2025, the Company produced approximately 86% of its domestic volume at breweries owned by the Company and, as noted above, anticipates producing over 90% of its domestic volume at breweries owned by the Company in 2026.
This emerging technology presents a number of risks inherent in its use. AI algorithms trained with noisy data may create accuracy issues, unintended biases, and discriminatory outcomes that could harm the Company’s brands, reputation, business, or customers.
This emerging technology presents a number of risks inherent in its use. AI algorithms trained with noisy data may create accuracy issues, unintended biases, and discriminatory outcomes that could harm the Company’s brands, reputation, business, or customers. Additionally, no assurance can be made that the usage of AI will assist the Company in being more efficient.
The Company has, as a practice, not hedged this exposure, although this practice is regularly reviewed. The cost of hops has increased in recent years due to the rising market price of hops and exchange rate changes. The continuation of these trends will impact the Company’s product cost and potentially the Company’s ability to meet the demand for its beers.
The cost of hops has increased in recent years due to the rising market price of hops and exchange rate changes. The continuation of these trends will impact the Company’s product cost and potentially the Company’s ability to meet the demand for its beers.
The Company’s reliance on production facilities owned by others and an inability to leverage investment in the Company-owned breweries could have a material adverse effect on the Company’s operations or financial results.
Significant adverse fluctuations in foreign currency exchange rates and increased tariffs may have a material adverse effect on the Company’s business and financial results. 17 The Company’s reliance on production facilities owned by others and an inability to leverage investment in the Company-owned breweries could have a material adverse effect on the Company’s operations or financial results.
If any negative changes were to occur, the Company might need to adapt its strategy for communicating its key messages regarding its history, equity, and current and potential future brand messaging. Any such change in the Company’s messaging strategy might have a detrimental impact on the future growth of the Company.
If any negative changes were to occur, the Company might need to adapt its strategy for communicating its key messages regarding its history, equity, and current and potential future brand messaging.
Currently, it is not possible to predict the impact of this on sales of alcohol, but it is possible that legal cannabis usage could adversely impact the demand for the Company’s products.
Currently, it is not possible to predict the impact of this on sales of alcohol, but it is possible that legal cannabis and hemp derived beverage consumption could adversely impact the demand for the Company’s products. The Company is dependent on its distributors.
If consumption of the Company’s products in general were to come into disfavor among domestic drinkers, or if the domestic alcohol beverage industry were subjected to significant additional societal pressure or governmental regulations, the Company’s business could be materially adversely affected. Additionally, certain states are considering or have passed laws and regulations that allow the sale and distribution of cannabis.
If consumption of the Company’s products in general were to come into disfavor among domestic drinkers, or if the domestic alcohol beverage industry were subjected to significant additional societal pressure or governmental regulations, the Company’s business could be materially adversely affected.
In response to these issues, the Company significantly increased its capacity and personnel to address these challenges. 17 With a decline in volume over the second half of 2021 through 2024, the Company incurred additional supply chain related costs associated with downsizing its production model to adjust to reduced demand.
With a decline in volume over the second half of 2021 through 2025, the Company incurred additional supply chain related costs associated with downsizing its production model to adjust to reduced demand.
Additionally, no assurance can be made that the usage of AI will assist the Company in being more efficient. 22 Further, dependence on AI without adequate safeguards to make certain business decisions may introduce additional operational vulnerabilities by producing inaccurate outcomes, recommendations, or other suggestions based on flaws in the underlying data or other unintended results.
Further, dependence on AI without adequate safeguards to make certain business decisions may introduce additional operational vulnerabilities by producing inaccurate outcomes, recommendations, or other suggestions based on flaws in the underlying data or other unintended results.
The US Beer Market has experienced a decline in shipments over the last ten years. The Company believes that this decline is due to declining alcohol consumption per person in the population, health and wellness trends and increased competition from wine and spirits companies.
The Company believes that this decline is due to declining alcohol consumption per person in the population, economic uncertainty, health and wellness trends and increased competition from wine, spirits and other beverage companies.
Claims, whether or not meritorious, could be asserted against the Company that might adversely impact the Company’s results. 23 Risks Related to General Economic Conditions The Company’s operating results and cash flow may be adversely affected by unfavorable economic, financial and societal market conditions.
Risks Related to General Economic Conditions The Company’s operating results and cash flow may be adversely affected by unfavorable economic, financial and societal market conditions.
The Beyond beer and Traditional beer markets within the United States (“US Beer Market”) is highly competitive due to the participation of large domestic and international brewers and the large number of regional and local competitors, who distribute similar products that have similar pricing and target drinkers. 15 The two largest brewers in the United States, AB InBev and Molson Coors, participate actively in the US Beer Market, through numerous offerings including beers, flavored malt beverages, hard seltzers and spirit RTDs.
The Beyond beer and Traditional beer markets within the United States (“US Beer Market”) is highly competitive due to the participation of large domestic and international brewers and the large number of regional and local competitors, who distribute similar products that have similar pricing and target drinkers.
The Company has an experienced leadership team with an established track record of business success and innovation in the beverage and consumer goods industries. The Company has and is likely to experience changes in key leadership or key positions regularly. The departure of key leadership personnel can take from the Company significant knowledge and experience.
Turnover in Company leadership or other key positions may lead to loss of key knowledge or capability and adversely impact Company performance. The Company has an experienced leadership team with an established track record of business success and innovation in the beverage and consumer goods industries.
The Company’s operations are subject to certain operating hazards that could result in unexpected costs or product recalls that could harm the Company’s business.
Any such change in the Company’s messaging strategy might have a detrimental impact on the future growth of the Company. 19 The Company’s operations are subject to certain operating hazards that could result in unexpected costs or product recalls that could harm the Company’s business.
The Company buys some other ingredients and capital equipment from foreign suppliers for which the Company also carries exposure to foreign exchange rate and tariff changes. Significant adverse fluctuations in foreign currency exchange rates and increased tariffs may have a material adverse effect on the Company’s business and financial results.
The Company buys some other ingredients and capital equipment from foreign suppliers for which the Company also carries exposure to foreign exchange rate and tariff changes.
Changes in federal and other tax rates could have a significant effect on the Company’s financial results. There is no guarantee that the Company will not face litigation that could harm the Company’s business. The Company has from time to time in the past been involved in material litigation.
There is no guarantee that the Company will not face litigation that could harm the Company’s business. The Company has from time to time in the past been involved in material litigation. Claims, whether or not meritorious, could be asserted against the Company that might adversely impact the Company’s results.
These supply constraints impacted the Company’s production schedules and increased can cost by having to use a more expensive supplier. 18 The Company maintains competitive sources for the supply of packaging materials, such as cans, glass and cardboard. The Company enters into limited-term supply agreements with certain vendors in order to receive preferential pricing.
The Company is dependent on key packaging suppliers and an increase in packaging costs could harm the Company’s financial results. The Company maintains competitive sources for the supply of packaging materials, such as cans, glass and cardboard. The Company enters into limited-term supply agreements with certain vendors in order to receive preferential pricing.
Some of these contracts require the Company to make commitments on minimum volume of purchases based on Company forecasts. If the Company's needs decline significantly from its forecasts, the Company would likely incur storage costs for excess production or contractual penalties that might be significant and could have a material adverse impact on the Company's financial results.
If the Company's needs decline significantly from its forecasts, the Company would likely incur storage costs for excess production or contractual penalties that might be significant and could have a material adverse impact on the Company's financial results. 16 The Company is dependent on key ingredient suppliers, including foreign sources; its dependence on foreign sources creates foreign currency and tariff exposure for the Company; the Company’s use of natural ingredients creates weather and crop reliability and excess/shortage inventory exposure for the Company.
The Company’s most significant innovations in 2024 was the introduction of its Sun Cruiser brand, a new vodka based RTD, as well as the launch of its Truly Unruly Mix Pack and Twisted Tea Extreme.
The Company’s most significant innovations in 2025 were the introduction of new Sun Cruiser styles and packages including Sun Cruiser vodka based lemonade, as well as the launch of Truly Unruly Lemonade Mix Pack, Dogfish Head Grateful Dead Juicy Pale Ale and Sinless Vodka Cocktails, a new spirits RTD brand.
In the first quarter of 2025, the Company is planning to launch Truly Unruly Lemonade Mix Pack, Sun Cruiser vodka based hard lemonade and Dogfish Head Grateful Dead Juicy Pale Ale. During the rest of 2025, the Company has plans to add new beverage styles and may reformulate existing styles of beverages.
In the first quarter of 2026, the Company is planning to expand Sinless Vodka Cocktails into additional states, launch Twisted Tea Extreme Variety Pack, Samuel Adams Cherry Bomb Ale and Dogfish Head Grateful Dead Citrus Daydream Lager. During the rest of 2026, the Company has plans to add new brands, new beverage styles and may reformulate existing styles of beverages.
The Company’s new product development can also be constrained by any limited availability of the desired ingredients.
The Company’s new product development can also be constrained by any limited availability of the desired ingredients. Growth rates higher than planned or the introduction of new products requiring special ingredients could create demand for ingredients greater than the Company can source.
Growth or decline in the Company’s revenues, changes in operating procedures, and increased complexity have required significant capital investment. The Company on an overall basis has yet to see any operating cost leverage from these investments and there is no guarantee that it will.
Growth or decline in the Company’s revenues, changes in operating procedures, and increased complexity have required significant capital investment.
Growth rates higher than planned or the introduction of new products requiring special ingredients could create demand for ingredients greater than the Company can source. 19 The Company’s contracts for certain hops and apples are payable in Euros, Pounds Sterling and New Zealand dollars, and therefore, the Company is subject to the risk that the currencies may fluctuate adversely against the U.S. dollar.
The Company’s contracts for certain hops and apples are payable in Euros, and therefore, the Company is subject to the risk that the currencies may fluctuate adversely against the U.S. dollar. The Company has, as a practice, not hedged this exposure, although this practice is regularly reviewed.
The Company remains reliant on third party-owned production facilities, particularly City Brewing Company, LLC, and its subsidiaries, to meet demand. The percentage of its domestic volume produced at Company owned breweries decreased from over 90% in 2017 to approximately 74% in 2024.
Despite these increases, third party-owned production facilities remain a critical part of the Company’s production strategy and the Company is reliant on them, particularly City Brewing Company, LLC, and its subsidiaries, to meet demand.
Removed
The Company’s products compete generally with other alcoholic beverages.
Added
The two largest brewers in the United States, AB InBev and Molson Coors, participate actively in the US Beer Market, through numerous offerings including beers, flavored malt beverages, hard seltzers and spirit RTDs.
Removed
As previously discussed, the Company has entered into an agreement with Pepsi to develop, market and sell alcohol beverages which include Hard Mountain Dew, a flavored malt beverage, to take advantage of this trend.
Added
More recently, younger generations including Millennials and Gen Z, are embracing moderation or abstinence, influenced by wellness trends and the rise of non-alcoholic alternatives. Some drinkers are embracing the “sober curious” movement, which encourages individuals to question their relationship with alcohol and explore alternatives.
Removed
The company has a cannabis-based beverage product in Canada and could be ready to produce that in the United States if the regulatory environment changes. 16 The Company is dependent on its distributors.
Added
The US Beer Market has experienced a decline in shipments over the last ten years. More recently in 2025 these declines accelerated to an approximate decline of 4% in volume.
Removed
The Company currently expects that the percentage of total domestic production at Company owned breweries in 2025 will be 80%. The Company expects its reliance on production at City Brewing Company, LLC to decline from approximately 26% of production in 2024 to approximately 20% of production in 2025.
Added
Additionally, many states are considering or have passed laws and regulations that allow the sale and distribution of cannabis and hemp based products. In December 2025, cannabis was reclassified from a Schedule I controlled substance to Schedule III by the federal government, reflecting its recognized medical use and lower potential for abuse.
Removed
The Company is dependent on key packaging suppliers and an increase in packaging costs could harm the Company’s financial results. In 2020 and 2021, as the Truly and the Twisted brand families grew significantly and overall demand for cans increased, the Company experienced supply constraints for cans.
Added
In certain states hemp derived beverages are competing with alcoholic beverages for shelf space and drinkers, despite recent federal regulations which restrict their availability after November 2026.
Removed
The Company is dependent on key ingredient suppliers, including foreign sources; its dependence on foreign sources creates foreign currency and tariff exposure for the Company; the Company’s use of natural ingredients creates weather and crop reliability and excess/shortage inventory exposure for the Company.
Added
The Company on an overall basis has yet to see any operating cost leverage from these investments and there is no guarantee that it will. 15 The Company has increased the percentage of its domestic volume produced at Company owned breweries from 74% in 2024 to 86% in 2025 and is currently estimating a further increase to over 90% in 2026.
Removed
In selecting third party production facilities for production services arrangements, the Company carefully weighs a facility's sleek can packaging and automated variety packaging capability and capacity, its quality control capabilities throughout the production process.
Added
During 2025 the Company significantly increased its spending on advertising and promotion by $61.0 million or 13.6% and during 2026 the Company currently estimates it will further increase spending by between $20 million and $40 million.
Removed
The Company continues to work at its Company-owned breweries and with its third-party production partners to attempt to minimize any potential disruptions.
Added
Some of these contracts require the Company to make commitments on minimum volume of purchases based on Company forecasts.
Added
During both 2024 and 2025 the Company has had transition of its Chief Executive Officer. The Company has and is likely to experience future changes in key leadership or key positions regularly. The departure of key leadership personnel can take from the Company significant knowledge and experience.
Added
Changes in federal and other tax rates could have a significant effect on the Company’s financial results.
Added
The Company has been and expects to continue to be adversely impacted by tariff programs The Company sources some of its goods and services from countries impacted from the tariff programs announced by the U.S. government and these tariffs have had an adverse effect on the Company’s business and financial results.
Added
The Company has reviewed its supply chain and business and based on information currently available, the primary impact of these tariffs is higher costs of packaging, ingredients, promotional materials and capital equipment which are currently sourced from Canada, European Union, China, and Mexico.
Added
The Company has reported these costs due to tariffs and the impact to its statement of operations in the amount of $11 million in 2025.
Added
In 2026, the Company estimates tariff costs will increase to between $20 million and $30 million, primarily because tariffs were effective for only part of 2025, resulting in a partial‑year impact, while 2026 is expected to reflect a full year of impact if current tariffs remain in place.
Added
These tariff cost estimates are based upon tariffs in place prior to the February 20, 2026 Supreme Court ruling.
Added
These estimates could materially change and the Company will closely monitor the tariff environment and continue to evaluate and explore opportunities to mitigate these negative impacts but there is no guarantee that these efforts will be effective. 21 In addition, 5% of the Company’s revenue is from countries outside the United States with the majority of this revenue in Canada.
Added
The Company’s U.S. and international businesses could also be negatively impacted if tariffs result in changes in consumer demand or cause currency related impacts. The Company’s reported amounts and future estimates of the impact of tariff costs do not reflect any potential impacts of tariffs on consumer demand or currency related impacts.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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The cybersecurity team also leverages multiple third-party security programs for full-time monitoring of security stacks and on-demand support to act as force multipliers in the event of severe or critical security events. The Company's Board of Directors has ultimate oversight of cybersecurity risk and aids in making decisions with respect to company priorities, resource allocations, and oversight structures.
The cybersecurity team also leverages multiple third-party security programs for full-time monitoring of security stacks and on-demand support to act as force multipliers in the event of severe or critical security events. 22 The Company's Board of Directors has ultimate oversight of cybersecurity risk and aids in making decisions with respect to company priorities, resource allocations, and oversight structures.
The Company's cybersecurity program is led by its Chief Information Security Officer (CISO) , who reports to its Chief Information Officer (CIO) . The CISO is responsible for management of cybersecurity risk and the protection and defense of the Company's networks and systems.
The Company's cybersecurity program is led by its Chief Information Security Officer (CISO) , who reports to its Director, IT Infrastructure and Architecture. The CISO is responsible for management of cybersecurity risk and the protection and defense of the Company's networks and systems.
The Company's internal cybersecurity team and third-party security services provide comprehensive cyber threat detection and response capabilities and maintain a full-time monitoring system which complements the technology, processes and threat detection techniques we use to monitor, manage and mitigate cybersecurity threats.
The Company utilizes best-in-class SIEM technologies, data analytics and threat intelligence to detect anomalies and search for cyber threats. The Company's internal cybersecurity team and third-party security services provide comprehensive cyber threat detection and response capabilities and maintain a full-time monitoring system which complements the technology, processes and threat detection techniques we use to monitor, manage and mitigate cybersecurity threats.
The Board of Directors is assisted by the Audit Committee, which regularly reviews the cybersecurity program with management and reports to the Board of Directors.
The Board of Directors is assisted by the Audit Committee, which regularly reviews the cybersecurity program with management and reports to the Board of Directors. Cybersecurity reviews by the Audit Committee or the Board of Directors generally occur at least once annually, or more frequently as determined to be necessary or advisable.
The Company works to protect its computing environments and products from cybersecurity threats through multi-layered defenses and apply lessons learned from its defense and monitoring efforts to proactively prevent future attacks. The Company utilizes best-in-class SIEM technologies, data analytics and threat intelligence to detect anomalies and search for cyber threats.
The Company's approach to cybersecurity risk management includes the following key elements: • Multi-Layered Defense and Continuous Monitoring. The Company works to protect its computing environments and products from cybersecurity threats through multi-layered defenses and apply lessons learned from its defense and monitoring efforts to proactively prevent future attacks.
Removed
Cybersecurity reviews by the Audit Committee or the Board of Directors generally occur at least once annually, or more frequently as determined to be necessary or advisable. 24 The Company's approach to cybersecurity risk management includes the following key elements: • Multi-Layered Defense and Continuous Monitoring.

Item 2. Properties

Properties — owned and leased real estate

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The Company also leases small offices in Burlington, Vermont, Montreal, Quebec, and Toronto, Ontario as well as various warehousing facilities across the United States and Canada. The Company believes that its facilities are adequate for its current needs and that suitable additional space will be available on commercially acceptable terms as required.
The Company also leases small offices in Burlington, Vermont, Montreal, Quebec, and Toronto, Ontario as well as various warehousing facilities across the United States and Canada. The Company believes that its facilities are adequate for its current needs and that suitable additional space will be available on commercially acceptable terms as required. 24
The Company leases approximately 48,650 square feet of space in Los Angeles, California, on which it maintains an Angel City and Truly brand tap room, small brewery, and tour center. The current term of the lease for this facility will expire in 2026.
The Company leases approximately 48,650 square feet of space in Los Angeles, California, on which it maintains an Angel City Brewery branded tap room, small brewery, and tour center. The current term of the lease for this facility will expire in 2026.
The buildings on this property consist of approximately 128,500 square feet of brewery and warehouse space. 25 The Company leases approximately 10,000 square feet of space in Cincinnati, Ohio, on which it maintains a Samuel Adams brand tap room and small brewery. The current term of the lease for this facility will expire in 2028.
The Company leases approximately 10,000 square feet of space in Cincinnati, Ohio, on which it maintains a Samuel Adams brand tap room and small brewery. The current term of the lease for this facility will expire in 2028.
The Company owns approximately 0.5 acre of land in Lewes, Delaware, on which the Company’s Dogfish Head Inn is located. The buildings on this property consists of approximately 8,400 square feet of space.
The buildings on this property consist of approximately 150,000 square feet of brewery and warehouse space. The Company owns approximately 0.5 acre of land in Lewes, Delaware, on which the Company’s Dogfish Head Inn is located. The buildings on this property consists of approximately 8,400 square feet of space.
The Company owns approximately 12 acres of land in Cincinnati, Ohio, on which the Company’s Cincinnati Brewery is located, and leases, with an option to purchase, approximately 0.75 acre of land from 3rd party investment group which abuts its property.
The Company owns approximately 12 acres of land in Cincinnati, Ohio, on which the Company’s Cincinnati Brewery is located, and leases, with an option to purchase, approximately 0.75 acre of land from 3rd party investment group which abuts its property. The buildings on this property consist of approximately 128,500 square feet of brewery and warehouse space.
The Company, under a development agreement, has access to approximately 900 square feet of space in Windsor, Ontario, on which it maintains a cannabis research and development facility. The current term of the agreement for this facility will expire in 2026.
The Company announced it will not renew the lease and close the Angel City Brewery effective April 30, 2026. The Company, under a development agreement, has access to approximately 900 square feet of space in Windsor, Ontario, on which it maintains a cannabis research and development facility. The current term of the agreement for this facility will expire in 2026.
The Company owns approximately 76 acres of land in Breinigsville, Pennsylvania, consisting of three parcels on which the Company’s Pennsylvania Brewery is located. The buildings on this property consist of approximately 1 million square feet of brewery and warehouse space.
The Company owns approximately 76 acres of land in Breinigsville, Pennsylvania, consisting of three parcels on which the Company’s Pennsylvania Brewery is located.
The buildings on this property consist of approximately 17,650 square feet of space. The Company owns approximately 57 acres of land in Milton, Delaware, on which the Company’s Milton Brewery is located. The buildings on this property consist of approximately 150,000 square feet of brewery and warehouse space.
The Company owns approximately 64 acres of land in Walden, New York, consisting of an apple orchard and buildings, including a small cidery, gift shop, and tour center. The buildings on this property consist of approximately 17,650 square feet of space. The Company owns approximately 57 acres of land in Milton, Delaware, on which the Company’s Milton Brewery is located.
The company leases approximately 585,000 square feet of space in Alburtis, PA, on which it maintains a warehouse for raw and finished goods. The current lease for this facility will expire January 2027, although it has an option to renew for one (1) five-year extension.
The buildings on this property consist of approximately 1 million square feet of brewery and warehouse space. 23 The company leases approximately 585,000 square feet of space in Alburtis, PA, on which it maintains a warehouse for raw and finished goods.
Removed
The Company leases approximately 7,815 square feet of office space in Cincinnati, Ohio. Lease is due to expire in September 2025 with no extension options. The Company owns approximately 64 acres of land in Walden, New York, consisting of an apple orchard and buildings, including a small cidery, gift shop, and tour center.
Added
The current lease for this facility will expire January 2027, although it has an option to renew for one (1) five-year extension.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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(“Ardagh”) filed an action against the Company alleging, among other things, that the Company had failed to purchase contractual minimum volumes of certain aluminum beverage can containers in 2021 and 2022. The Company filed an Amended Answer, Amended Affirmative Defenses and Amended Counterclaims on March 25, 2024.
(“Ardagh”) filed an action against the Company alleging, among other things, that the Company had failed or would fail to purchase contractual minimum volumes of certain aluminum beverage can containers in 2021 to 2026. The Company filed an Amended Answer, Amended Affirmative Defenses and Amended Counterclaims on March 25, 2024.
Following briefing by the parties, on June 17, 2024, the Court granted the Company's Motion to Reconsider, denied Ardagh's Motion for Judgment on the Pleadings, and vacated its February 26, 2024 Order. The Court set a fact discovery deadline of November 25, 2024 with some discovery motions still pending.
Following briefing by the parties, on June 17, 2024, the Court granted the Company's Motion to Reconsider, denied Ardagh's Motion for Judgment on the Pleadings, and vacated its February 26, 2024 Order. The Court set a fact discovery deadline of November 25, 2024. The Court also set an expert discovery deadline of May 30, 2025.
Removed
Expert discovery has begun and the Court has set an expert discovery deadline of April 18, 2025. The Court has not set a date for summary judgment filings or trial. The Company denies that it breached the terms of the parties’ contract and intends to defend against the Ardagh claims vigorously. Item 4.
Added
Ardagh has filed a Motion for Partial Summary Judgment on certain liability issues. The Company also has filed a Motion for Partial Summary judgment on certain liability and damage issues. The Court has set a trial date to commence on March 23, 2026.
Removed
Mine Safe ty Disclosures Not Applicable 26 PART II.
Added
The Company denies that it breached the terms of the parties’ contract and intends to defend against the Ardagh claims vigorously. The possible outcome of this litigation could range from zero to the level of Ardagh's initial demand of over/approximately $300 million plus interest if applied. Item 4. Mine Safe ty Disclosures Not Applicable 25 PART II.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Class B Common Stock At December 28, 2024, the Company had 4,200,000 authorized shares of Class B Common Stock with a par value of $0.01, of which 2,068,000 shares were issued and outstanding.
Class B Common Stock At December 27, 2025, the Company had 4,200,000 authorized shares of Class B Common Stock with a par value of $0.01, of which 2,068,000 shares were issued and outstanding.
The Company’s Class B Common Stock is not listed for trading. Each share of Class B Common Stock is freely convertible into one share of Class A Common Stock, upon request of any Class B holder. As of February 21, 2025, C.
The Company’s Class B Common Stock is not listed for trading. Each share of Class B Common Stock is freely convertible into one share of Class A Common Stock, upon request of any Class B holder. As of February 20, 2026, C.
James Koch, the Company’s Chairman, was the direct holder of record of all of the Company’s issued and outstanding Class B Common Stock.
James Koch, the Company’s Chairman and Chief Executive Officer, was the direct holder of record of all of the Company’s issued and outstanding Class B Common Stock.
Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities The graph set forth below shows the value of an investment of $100 on January 1, 2019 in each of the Company’s stock (“The Boston Beer Company, Inc.”), the Standard & Poor’s 500 Index (“S&P 500 Index”) and the Standard & Poor’s 500 Beverage Index, which consists of producers of alcoholic and non-alcoholic beverages (“S&P 500 Beverages Index”) for the five years ending December 28, 2024.
Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities The graph set forth below shows the value of an investment of $100 on December 26, 2020 in each of the Company’s stock (“The Boston Beer Company, Inc.”), the Standard & Poor’s 500 Index (“S&P 500 Index”) and the Standard & Poor’s 500 Beverage Index, which consists of producers of alcoholic and non-alcoholic beverages (“S&P 500 Beverages Index”) for the five years ending December 27, 2025.
There were 6,603 holders of record of the Company’s Class A Common Stock as of February 21, 2025. Excluded from the number of stockholders of record are stockholders who hold shares in “nominee” or “street” name.
There were 6,292 holders of record of the Company’s Class A Common Stock as of February 20, 2026. Excluded from the number of stockholders of record are stockholders who hold shares in “nominee” or “street” name.
The closing price per share of the Company’s Class A Common Stock as of February 21, 2025, as reported under the New York Stock Exchange-Composite Transaction Reporting System, was $227.32. 27 Class A Common Stock At December 28, 2024, the Company had 22,700,000 authorized shares of Class A Common Stock with a par value of $0.01, of which 9,291,092 were issued and outstanding, which includes 27,894 shares that have trading restrictions.
The closing price per share of the Company’s Class A Common Stock as of February 20, 2026, as reported under the New York Stock Exchange-Composite Transaction Reporting System, was $235.00. 26 Class A Common Stock At December 27, 2025, the Company had 22,700,000 authorized shares of Class A Common Stock with a par value of $0.01, of which 8,438,651 were issued and outstanding, which includes 30,193 shares that have trading restrictions.
As of December 28, 2024, the Company had repurchased a cumulative total of approximately 14.9 million shares of its Class A Common Stock for an aggregate purchase price of approximately $1.17 billion and had approximately $427.5 million remaining on the $1.6 billion stock repurchase expenditure limit set by the Board of Directors. 28 During fiscal year 2024, the Company repurchased and subsequently retired 803,281 shares of its Class A Common Stock for an aggregate purchase price of $238.9 million.
As of December 27, 2025, the Company had repurchased a cumulative total of approximately 15.8 million shares of its Class A Common Stock for an aggregate purchase price of approximately $1.37 billion and had approximately $228.4 million remaining on the $1.6 billion stock repurchase expenditure limit set by the Board of Directors. 27 During fiscal year 2025, the Company repurchased and subsequently retired 896,521 shares of its Class A Common Stock for an aggregate purchase price of $199.2 million.
Total Return to Shareholders (Includes reinvestment of dividends) ANNUAL RETURN PERCENTAGE Years Ending Company Name / Index 12/26/2020 12/25/2021 12/31/2022 12/30/2023 12/28/2024 The Boston Beer Company, Inc. 167.97 (48.29 ) (37.22 ) 4.88 (12.87 ) S&P 500 Index 16.40 29.44 (17.40 ) 26.29 26.90 S&P 500 Beverages Index 6.56 14.51 8.93 (1.98 ) (0.89 ) INDEXED RETURNS Years Ending Company Name / Index Base Period 12/28/2019 12/26/2020 12/25/2021 12/31/2022 12/30/2023 12/28/2024 The Boston Beer Company, Inc. 100 424.98 219.78 137.98 144.71 79.50 S&P 500 Index 100 154.78 200.35 165.49 209.00 199.46 S&P 500 Beverages Index 100 132.12 151.29 164.81 161.54 129.12 The Company’s Class A Common Stock is listed for trading on the New York Stock Exchange under the symbol SAM.
(48.29 ) (37.22 ) 4.88 (12.87 ) (34.56 ) S&P 500 Index 29.44 (17.40 ) 26.29 26.90 17.55 S&P 500 Beverages Index 14.51 8.93 (1.98 ) (0.89 ) 4.96 INDEXED RETURNS Years Ended Company Name / Index Base Period 12/26/2020 12/25/2021 12/31/2022 12/30/2023 12/28/2024 12/27/2025 The Boston Beer Company, Inc. 100 51.71 32.47 34.05 29.67 19.42 S&P 500 Index 100 129.44 106.92 135.03 171.36 201.43 S&P 500 Beverages Index 100 114.51 124.74 122.27 121.18 127.18 The Company’s Class A Common Stock is listed for trading on the New York Stock Exchange under the symbol SAM.
Removed
Additionally, the Company repurchased 1,351 shares of its Class A Common Stock for repurchases of unvested investment shares issued under the Investment Share Program of the Company’s Employee Equity Incentive Plan, as illustrated in the table below: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (in thousands) December 31, 2023 - February 3, 2024 61,817 $ 349.89 61,525 $ 244,893 February 4, 2024 - March 2, 2024 53,335 345.82 53,328 226,450 March 3, 2024 - March 30, 2024 33,386 298.76 33,330 216,490 March 31, 2024 - May 4, 2024 86,768 288.13 86,741 191,494 May 5, 2024 - June 1, 2024 69,743 273.32 69,339 172,497 June 2, 2024 - June 29, 2024 64,486 294.91 64,366 153,499 June 30, 2024 - August 3, 2024 84,144 285.37 84,067 129,502 August 4, 2024 - August 31, 2024 72,999 274.42 72,744 109,504 September 1, 2024 - September 28, 2024 69,054 275.29 68,973 90,505 September 29, 2024 - November 2, 2024 86,828 287.89 86,828 465,506 November 3, 2024 - November 30, 2024 60,978 311.62 60,946 446,509 December 1, 2024 - December 28, 2024 61,094 310.53 61,094 427,536 Total 804,632 $ 297.22 803,281 $ 427,536 Item 6. [ R eserved] 29
Added
Total Return to Shareholders (Includes reinvestment of dividends) ANNUAL RETURN PERCENTAGE Years Ended Company Name / Index 12/25/2021 12/31/2022 12/30/2023 12/28/2024 12/27/2025 The Boston Beer Company, Inc.
Added
Additionally, the Company repurchased 1,399 shares of its Class A Common Stock for repurchases of unvested investment shares issued under the Investment Share Program of the Company’s Employee Equity Incentive Plan, as illustrated in the table below: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (in thousands) December 29, 2024 - February 1, 2025 67,075 $ 265.00 66,968 $ 409,783 February 2, 2025 - March 1, 2025 65,019 235.84 65,011 394,450 March 2, 2025 - March 29, 2025 69,531 232.87 69,268 378,310 March 30, 2025 - May 3, 2025 79,815 241.65 79,728 359,044 May 4, 2025 - May 31, 2025 63,971 239.62 63,970 343,714 June 1, 2025 - June 28, 2025 73,918 207.69 73,728 328,383 June 29, 2025 - August 2, 2025 96,929 200.07 96,733 309,018 August 3, 2025 - August 30, 2025 73,723 219.18 73,558 292,882 August 31, 2025 - September 27, 2025 65,755 220.54 65,715 278,383 September 28,2025 - November 1, 2025 91,690 220.11 91,617 258,212 November 2, 2025 - November 29, 2025 77,306 198.80 77,038 242,882 November 30, 2025 - December 27, 2025 73,188 198.08 73,187 228,383 Total 897,920 $ 222.03 896,521 $ 228,383 Item 6. [ R eserved] 28

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Customer incentives and other payments made to Distributors are primarily based upon the performance of certain marketing and advertising activities. Depending on applicable state laws and regulations, these activities promoting the Company’s products may include, but are not limited to, point-of-sale and merchandise placement, samples, product displays, promotional programs at retail locations and meals, travel and entertainment.
Customer incentives and other payments made to Distributors are primarily based upon the performance of certain marketing and advertising activities. Depending on applicable state laws and regulations, these activities promoting the Company’s products may include, but are not limited to, discounts, point-of-sale and merchandise placement, samples, product displays, promotional programs at retail locations and meals, travel and entertainment.
Depending on applicable state laws and regulations, these activities promoting the Company’s products may include, but are not limited to, point-of-sale and merchandise placement, samples, product displays, promotional programs at retail locations and meals, travel and entertainment.
Depending on applicable state laws and regulations, these activities promoting the Company’s products may include, but are not limited to, discounts, point-of-sale and merchandise placement, samples, product displays, promotional programs at retail locations and meals, travel and entertainment.
With its over 300 Distributors nationwide and the Company’s sales force of over 475 people, as well as a commitment to maintaining its innovation capability, brand equity and quality, the Company believes it is well positioned to compete in the Beyond beer and Traditional beer categories.
With its over 300 Distributors nationwide and the Company’s sales force of over 550 people, as well as a commitment to maintaining its innovation capability, brand equity and quality, the Company believes it is well positioned to compete in the Beyond beer and Traditional beer categories.
The Company also increasingly competes with wine and spirits companies, some of which have significantly greater resources than the Company. This competitive environment may affect the Company’s overall performance within the Beyond beer and Traditional beer categories.
The Company also increasingly competes with wine, spirits and other beverage companies, some of which have significantly greater resources than the Company. This competitive environment may affect the Company’s overall performance within the Beyond beer and Traditional beer categories.
Furthermore, if the review of the carrying values of the long-lived assets indicates impairment of such assets, the Company may determine that shorter estimated useful lives are more appropriate. In that event, the Company will be required to record additional depreciation in future periods, which will reduce earnings.
Furthermore, if the review of the carrying values of the long-lived assets indicates impairment of such assets, the Company may determine that shorter estimated useful lives are more appropriate. In that event, the Company will be required to accelerate depreciation in future periods, which will reduce earnings.
A significant change in the timing or level of demand for certain products as compared to forecasted amounts may result in recording additional provisions for excess or expired inventory in the future. Provision for excess or expired inventory included in cost of goods sold was $21.9 million, $19.3 million, and $35.9 million in fiscal years 2024, 2023, and 2022 respectively.
A significant change in the timing or level of demand for certain products as compared to forecasted amounts may result in recording additional provisions for excess or expired inventory in the future. Provision for excess or expired inventory included in cost of goods sold was $13.7 million, $21.9 million, and $19.3 million in fiscal years 2025, 2024, and 2023 respectively.
Stock-based compensation was $19.0 million, $17.0 million and $14.0 million in fiscal years 2024, 2023, and 2022, respectively. As permitted by ASC 718, the Company elected to use a lattice model, such as the trinomial option-pricing model, to estimate the fair values of stock options. All option-pricing models require the input of subjective assumptions.
Stock-based compensation was $21.8 million, $19.0 million and $17.0 million in fiscal years 2025, 2024, and 2023, respectively. As permitted by ASC 718, the Company elected to use a lattice model, such as the trinomial option-pricing model, to estimate the fair values of stock options. All option-pricing models require the input of subjective assumptions.
As of December 28, 2024 and December 30, 2023, the Company had deferred revenue of $11.3 million and $8.9 million, respectively, related to product shipped prior to these dates for which the criteria to recognize revenue was not met as of these dates. These amounts are included in accrued expenses and other current liabilities in the accompanying consolidated balance sheets.
As of December 27, 2025 and December 28, 2024, the Company had deferred revenue of $13.3 million and $11.3 million, respectively, related to product shipped prior to these dates for which the criteria to recognize revenue was not met as of these dates. These amounts are included in accrued expenses and other current liabilities in the accompanying consolidated balance sheets.
Amounts paid to customers in connection with these programs that were recorded as reductions to net revenue or as advertising, promotional and selling expenses totaled $112.3 million, $106.4 million and $95.9 million in fiscal years 2024, 2023, and 2022, respectively.
Amounts paid to customers in connection with these programs that were recorded as reductions to net revenue or as advertising, promotional and selling expenses totaled $123.1 million, $112.3 million and $106.4 million in fiscal years 2025, 2024, and 2023, respectively.
Amounts paid to customers in connection with these programs in fiscal years 2024, 2023, and 2022 were $51.3 million, $43.8 million and $41.1 million, respectively. In fiscal years 2024, 2023, and 2022, the Company recorded certain of these costs in the total amount of $32.2 million, $31.4 million and $29.9 million, respectively as reductions to net revenue.
Amounts paid to customers in connection with these programs in fiscal years 2025, 2024, and 2023 were $57.9 million, $51.3 million and $43.8 million, respectively. In fiscal years 2025, 2024, and 2023, the Company recorded certain of these costs in the total amount of $38.4 million, $32.2 million and $31.4 million, respectively as reductions to net revenue.
Amounts paid to Distributors in connection with these programs in fiscal years 2024, 2023, and 2022 were $61.0 million, $62.6 million and $54.8 million, respectively. The reimbursements for discounts to Distributors are recorded as reductions to net revenue.
Amounts paid to Distributors in connection with these programs in fiscal years 2025, 2024, and 2023 were $65.2 million, $61.0 million and $62.6 million, respectively. The reimbursements for discounts to Distributors are recorded as reductions to net revenue.
Historically, the cost of actual stale beer returns has been in line with established reserves; however, the cost could differ materially from the reserves which would impact revenue. As of December 28, 2024, and December 30, 2023, the stale beer reserve was $6.1 million and $8.2 million, respectively.
Historically, the cost of actual stale beer returns has been in line with established reserves; however, the cost could differ materially from the reserves which would impact revenue. As of December 27, 2025, and December 28, 2024, the stale beer reserve was $4.9 million and $6.1 million, respectively.
Cost of goods sold was $149.36 per barrel for the fifty-two weeks ended December 28, 2024, as compared to $150.59 per barrel for the fifty-two weeks ended December 30, 2023.
Cost of goods sold was $141.79 per barrel for the fifty-two weeks ended December 27, 2025, as compared to $149.36 per barrel for the fifty-two weeks ended December 28, 2024.
Cash and cash equivalents decreased to $211.8 million as of December 28, 2024 from $298.5 million as of December 30, 2023, primarily reflecting repurchases of the Company's Class A common stock, a note receivable issued, and purchases of property, plant, and equipment, partially offset by net cash provided by operating activities.
Cash and cash equivalents increased to $223.4 million as of December 27, 2025 from $211.8 million as of December 28, 2024, primarily reflecting net cash provided by operating activities, partially offset by repurchases of the Company's Class A common stock, and purchases of property, plant, and equipment.
For both periods, capital investments were made mostly in the Company’s breweries to drive efficiencies and cost reductions and support product innovation and future growth. 32 Cash used in financing activities was $239.3 million during the year ended December 28, 2024, as compared to $84.8 million during the year ended December 30, 2023.
For both periods, capital investments were made mostly in the Company’s breweries to drive efficiencies and cost reductions. Cash used in financing activities was $204.1 million during the year ended December 27, 2025, as compared to $239.3 million during the year ended December 28, 2024.
The Company used $96.3 million in investing activities during the year ended December 28, 2024, as compared to $62.4 million during the year ended December 30, 2023. The increase in investing activity cash outflows is due to a $20.0 million note receivable issued and a $12.2 million increase in capital investments.
The Company used $54.5 million in investing activities during the year ended December 27, 2025, as compared to $96.3 million during the year ended December 28, 2024. The decrease in investing activity cash outflows is due to a $20.0 million note receivable issued in 2024 and a $21.7 million decrease in capital investments.
Under the quantitative assessment, the estimated fair value of the Company’s reporting unit is compared to its carrying value, including goodwill. The estimate of fair value of the Company’s reporting unit is generally calculated based on an income approach using the discounted cash flow method supplemented by the market approach which considers the Company’s market capitalization and enterprise value.
When a quantitative test is performed, the estimated fair value of the reporting unit is compared to its carrying value, including goodwill. Fair value is primarily estimated using an income approach based on discounted cash flow analysis, supplemented by a market approach that considers the Company’s market capitalization and enterprise value.
Impairment of brewery assets classified as property, plant, and equipment included in operating expenses was $7.2 million, $5.0 million and $2.6 million in fiscal years 2024, 2023, and 2022, respectively.
Impairment charges included in operating expenses related to brewery assets classified as property, plant, and equipment were $6.4 million, $7.2 million, and $5.0 million for fiscal years 2025, 2024, and 2023, respectively. Impairment charges related to brewery assets classified as operating right‑of‑use assets were $0.6 million, $0.0 million, and $0.4 million for fiscal years 2025, 2024, and 2023, respectively.
Factors generally considered important which could trigger an impairment review on the carrying value of long-lived assets include the following: (1) significant underperformance relative to historical or projected future operating results; (2) significant changes in the manner of use of acquired assets or the strategy for the Company’s overall business; (3) underutilization of assets; and (4) discontinuance of products by the Company or its customers. 33 Valuation of Goodwill and Indefinite Lived Intangible Assets The Company has recorded intangible assets with indefinite lives and goodwill for which impairment testing is required at least annually or more frequently if events or circumstances indicate that these assets might be impaired.
Factors generally considered important which could trigger an impairment review on the carrying value of long-lived assets include the following: (1) significant underperformance relative to historical or projected future operating results; (2) significant changes in the manner of use of acquired assets or the strategy for the Company’s overall business; (3) underutilization of assets; and (4) discontinuance of products by the Company or its customers. 33 Valuation of Goodwill and Indefinite Lived Intangible Assets The Company records goodwill and identifiable intangible assets arising from business acquisitions.
Forward-Looking Statements In this Form 10-K and in other documents incorporated herein, as well as in oral statements made by the Company, statements that are prefaced with the words “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “intend,” “designed,” and similar expressions, are intended to identify forward-looking statements regarding events, conditions, and financial trends that may affect the Company’s future plans of operations, business strategy, results of operations, and financial position.
Management’s Discussion and Analysis of Financial Condition and Results of Operations Our Annual Report on Form 10-K for the year ended December 27, 2025 includes a discussion and analysis of our financial condition and results of operations for the years ended December 28, 2024 and December 30, 2023 in Item 7 of Part II, “Management’s Discussion and Analysis of Financial Condition and Results of Operations Forward-Looking Statements In this Form 10-K and in other documents incorporated herein, as well as in oral statements made by the Company, statements that are prefaced with the words “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “intend,” “designed,” and similar expressions, are intended to identify forward-looking statements regarding events, conditions, and financial trends that may affect the Company’s future plans of operations, business strategy, results of operations, and financial position.
The $154.5 million increase in financing activity cash outflows in 2024 compared to 2023 is primarily due to higher repurchases of the Company's Class A common stock in the current year. During fiscal year 2024, the Company repurchased and subsequently retired 803,281 shares of its Class A Common Stock for an aggregate purchase price of $238.9 million.
The $35.2 million decrease in financing activity cash outflows in 2025 compared to 2024 is primarily due to lower repurchases of the Company's Class A common stock in the current year. During fiscal year 2025, the Company repurchased and subsequently retired 896,521 shares of its Class A Common Stock for an aggregate purchase price of $199.2 million.
The net revenue per barrel increased by 2.7% to $268.64 per barrel for the year ended December 28, 2024, as compared to $261.61 per barrel for the year ended December 30, 2023, primarily due to price increases and lower returns. Cost of goods sold.
The net revenue per barrel increased by 2.4% to $275.21 per barrel for the year ended December 27, 2025, as compared to $268.64 per barrel for the year ended December 28, 2024, primarily due to price increases and favorable product mix. 30 Cost of goods sold.
Valuation of Property, Plant, and Equipment The carrying value of property, plant, and equipment, net of accumulated depreciation, at December 28, 2024 was $616.2 million.
Valuation of Property, Plant, and Equipment The carrying value of property, plant, and equipment, net of accumulated depreciation, at December 27, 2025 was $578.1 million.
Depletions of the Company’s products for the year ended December 28, 2024 decreased by approximately 2% compared to the prior year. The Company believes distributor inventory as of December 28, 2024 averaged approximately four weeks on hand and was at an appropriate level for each of its brands. Net Revenue per barrel.
Depletions of the Company’s products for the year ended December 27, 2025 decreased by approximately 4% compared to the prior year. The Company believes distributor inventory as of December 27, 2025 was at appropriate levels and averaged approximately four weeks on hand which is within the Company’s target wholesaler inventory levels. Net Revenue per barrel.
Inflationary impacts of $18.6 million consist primarily of increased material costs of $10.2 million and internal brewery costs of $8.4 million. Gross profit. Gross profit was $119.27 per barrel for the year ended December 28, 2024, as compared to $111.01 per barrel for the year ended December 30, 2023.
Inflationary impacts of $36.8 million consist primarily of increased raw material costs of $30.5 million, inclusive of $10.1 million impact from tariffs, and increased internal brewery costs of $6.3 million. Gross profit. Gross profit was $133.41 per barrel for the year ended December 27, 2025, as compared to $119.27 per barrel for the year ended December 28, 2024.
Total shipment volume of 7,493,000 barrels for the year ended December 28, 2024 decreased by 2.4% over 2023 levels of 7,678,000 barrels, primarily due to decreases in the Company’s Truly brands, partially offset by increases in its Twisted Tea and Sun Cruiser brands.
Total shipment volume of 7,140,000 barrels for the year ended December 27, 2025 decreased by 4.7% over 2024 levels of 7,493,000 barrels, primarily due to decreases in Twisted Tea, Truly Hard Seltzer and Samuel Adams brands that were only partially offset by growth in the Company’s Sun Cruiser, Angry Orchard and Dogfish Head brands.
Under the quantitative assessment, the trademark is evaluated for impairment by comparing the carrying value of the trademark to its estimated fair value. The estimated fair value of the trademark is calculated based on an income approach using the relief from royalty method.
When a quantitative test is performed, the carrying value of the trademark is compared to its estimated fair value. The fair value of the trademark is determined using an income approach based on the relief‑from‑royalty method.
Gross margin was 44.4% for the year ended December 28, 2024, as compared to 42.4% for the year ended December 30, 2023. Gross margin primarily benefited from price increases, contract renegotiations and recipe optimization savings and lower returns, partially offset by higher brewery processing costs per barrel due to lower volumes and increased inflationary costs.
Gross margin was 48.5% for the year ended December 27, 2025, as compared to 44.4% for the year ended December 28, 2024. Gross margin primarily benefited from contract renegotiations and recipe optimization savings, improved brewery efficiencies, price increases and favorable product mix. These benefits were partially offset by increased inflationary and tariff costs.
Results of Operations Year Ended December 28, 2024 (52 weeks) Compared to Year Ended December 30, 2023 (52 weeks) Year Ended (in thousands, except per barrel) Dec. 28 2024 Dec. 30 2023 Amount change % change Per barrel change Barrels sold 7,493 7,678 (185 ) (2.4 )% Per barrel % of net revenue Per barrel % of net revenue Net revenue $ 2,012,926 $ 268.64 100.0 % $ 2,008,625 $ 261.61 100.0 % $ 4,301 0.2 % $ 7.03 Cost of goods 1,119,194 149.36 55.6 % 1,156,256 150.59 57.6 % (37,062 ) (3.2 )% (1.23 ) Gross profit 893,732 119.27 44.4 % 852,369 111.01 42.4 % 41,363 4.9 % 8.26 Advertising, promotional, and selling expenses 552,033 73.67 27.4 % 555,998 72.41 27.7 % (3,965 ) (0.7 )% 1.26 General and administrative expenses 189,906 25.34 9.4 % 174,548 22.73 8.7 % 15,358 8.8 % 2.61 Impairment of intangible assets 42,584 5.68 2.1 % 16,426 2.14 0.8 % 26,158 >100% 3.54 Impairment of brewery assets 7,184 0.96 0.4 % 5,396 0.70 0.3 % 1,788 33.1 % 0.26 Contract settlement costs 26,052 3.48 1.3 % 0 0.00 0.0 % 26,052 >100% 3.48 Total operating expenses 817,759 109.14 40.6 % 752,368 97.99 37.5 % 65,391 8.7 % 11.15 Operating income 75,973 10.14 3.8 % 100,001 13.02 5.0 % (24,028 ) (24.0 )% (2.88 ) Other income, net 11,629 1.55 0.6 % 9,587 1.25 0.5 % 2,042 21.3 % 0.30 Income before income tax provision 87,602 11.69 4.4 % 109,588 14.27 5.5 % (21,986 ) (20.1 )% (2.58 ) Income tax provision 27,907 3.72 1.4 % 33,338 4.34 1.7 % (5,431 ) (16.3 )% (0.62 ) Net income $ 59,695 $ 7.97 3.0 % $ 76,250 $ 9.93 3.8 % $ (16,555 ) (21.7 )% $ (1.96 ) 30 Net revenue.
Results of Operations Year Ended December 27, 2025 (52 weeks) Compared to Year Ended December 28, 2024 (52 weeks) Year Ended (in thousands, except per barrel) Dec. 27 2025 Dec. 28 2024 Amount change % change Per barrel change Per barrel % change Barrels sold 7,140 7,493 (353 ) (4.7 )% Per barrel % of net revenue Per barrel % of net revenue Net revenue $ 1,964,994 $ 275.21 100.0 % $ 2,012,926 $ 268.64 100.0 % $ (47,932 ) (2.4 )% $ 6.57 2.4 % Cost of goods 1,012,414 141.79 51.5 % 1,119,194 149.36 55.6 % (106,780 ) (9.5 )% (7.57 ) (5.1 )% Gross profit 952,580 133.41 48.5 % 893,732 119.27 44.4 % 58,848 6.6 % 14.14 11.9 % Advertising, promotional, and selling expenses 609,953 85.43 31.0 % 552,033 73.67 27.4 % 57,920 10.5 % 11.76 16.0 % General and administrative expenses 190,790 26.72 9.7 % 189,906 25.34 9.4 % 884 0.5 % 1.38 5.4 % Impairment of intangible assets — — 0.0 % 42,584 5.68 2.1 % (42,584 ) (100.0 )% (5.68 ) (100.0 )% Impairment of brewery assets 6,955 0.97 0.4 % 7,184 0.96 0.4 % (229 ) (3.2 )% 0.01 1.0 % Contract settlement costs — 0.00 0.0 % 26,052 3.48 1.3 % (26,052 ) (100.0 )% (3.48 ) (100.0 )% Total operating expenses 807,698 113.12 41.1 % 817,759 109.14 40.6 % (10,061 ) (1.2 )% 3.98 3.6 % Operating income 144,882 20.29 7.4 % 75,973 10.14 3.8 % 68,909 90.7 % 10.15 >100% Other income, net 8,578 1.20 0.4 % 11,629 1.55 0.6 % (3,051 ) (26.2 )% (0.35 ) (22.6 )% Income before income tax provision 153,460 21.49 7.8 % 87,602 11.69 4.4 % 65,858 75.2 % 9.80 83.8 % Income tax provision 44,991 6.30 2.3 % 27,907 3.72 1.4 % 17,084 61.2 % 2.58 69.4 % Net income $ 108,469 $ 15.19 5.5 % $ 59,695 $ 7.97 3.0 % $ 48,774 81.7 % $ 7.22 90.6 % 29 Net revenue.
Beginning in the fourth quarter of 2024, the Company changed the indefinite useful life of the Dogfish Head trademark asset and began amortizing the remaining $14.4 million balance over an estimated useful life of 10 years.
Beginning in the fourth quarter of fiscal 2024, the Company commenced amortization of the remaining Dogfish Head intangible asset over an estimated useful life of 10 years. Impairment of brewery assets.
Impairment of brewery assets of $7.2 million increased by $1.8 million from the prior fiscal year, due to higher write-offs of equipment at Company-owned breweries. Contract settlement costs. Contract settlement costs of $26 million due to an amendment and restatement in its entirety of an existing production agreement with a third-party supplier, Rauch.
Impairment of brewery assets of $7.0 million decreased by $0.2 million from the prior fiscal year, due to lower write-offs of equipment at third party and Company-owned production facilities. 31 Contract settlement costs. The Company did not record any contract settlement costs in fiscal 2025.
The accrued expenses and other current liabilities increase of $13.9 million is primarily due to increases in accrued incentive compensation compared to the prior year. The accounts receivable increase of $10.3 million is primarily due to timing of shipments in the month of December compared to the prior year.
The accrued expenses and other current liabilities increase of $15.6 million is primarily due to increases in accrued contract manufacturing shortfall fees compared to the prior year.
Cash provided by operating activities for the year ended December 30, 2023 was $265.2 million and consisted of net income of $76.3 million, non-cash items of $124.0 million, and an inflow of $64.9 million from a net decrease in operating assets and liabilities.
Cash provided by operating activities for the year ended December 27, 2025 was $270.2 million and consisted of net income of $108.5 million, non-cash items of $114.7 million, and an inflow of $47.0 million from a net decrease in operating assets and liabilities. The inventory decrease of $23.4 million is primarily due to lower volumes and improved supply chain performance.
As of December 28, 2024, the Company had repurchased a cumulative total of approximately 14.9 million shares of its Class A Common Stock for an aggregate purchase price of approximately $1.17 billion and had approximately $427.5 million remaining on the $1.6 billion stock repurchase expenditure limit set by the Board of Directors.
As of December 27, 2025, the Company had repurchased a cumulative total of approximately 15.8 million shares of its Class A Common Stock for an aggregate purchase price of approximately $1.37 billion and had approximately $228.4 million remaining on the $1.6 billion stock repurchase expenditure limit set by the Board of Directors. 32 The Company expects that its cash balance as of December 27, 2025 of $223.4 million and future operating cash flows, along with its $150.0 million credit facility agreement, will be sufficient to fund future cash requirements.
This amendment adjusts the existing production agreement to better match the Company’s future capacity requirements and results in increased production flexibility and more favorable termination rights to the Company. Income tax provision.
In fiscal 2024, the Company recorded contract settlement costs of $26 million due to an amendment and restatement in its entirety of an existing production agreement with a third-party supplier, Rauch. This amendment adjusted the existing production agreement to better match the Company’s future capacity requirements and results in increased production flexibility and more favorable termination rights to the Company.
Advertising, promotional and selling expenses, decreased $4.0 million, or 0.7%, to $552.0 million for the year ended December 28, 2024, as compared to $556.0 million for the year ended December 30, 2023. The decrease was primarily due to decreased freight to distributors of $10.5 million from lower rates and volumes.
Advertising, promotional and selling expenses, increased $57.9 million, or 10.5%, to $610.0 million for the year ended December 27, 2025, as compared to $552.0 million for the year ended December 28, 2024.
The 2024 decrease in cost of goods sold of $1.23, or 3.2% per barrel was primarily due to contract renegotiations and recipe optimization savings of $24.1 million, or $3.22 per barrel, partially offset by inflationary impacts of $18.6 million, or $2.48 per barrel.
The 2025 decrease in cost of goods sold of $7.57 per barrel, or 5.1% was primarily due to contract renegotiations and recipe optimization savings of $37.4 million, or $5.24 per barrel, improved brewery efficiencies of $34.1 million, or $4.78 per barrel, decreases in inventory obsolescence of $10.3 million, or $1.44 per barrel and lower third-party production costs of $9.6 million, or $1.34 per barrel, partially offset by inflationary impacts, including tariffs, of $36.8 million, or $5.15 per barrel.
Brand and selling costs increased $6.5 million, primarily due to increased brand media investments and higher salaries and benefits. Advertising, promotional and selling expenses were 27.4% of net revenue, or $73.67 per barrel, for the year ended December 28, 2024, as compared to 27.7% of net revenue, or $72.41 per barrel, for the year ended December 30, 2023.
These increases were partially offset by a $3.0 million reduction in freight costs due to lower volumes. Advertising, promotional and selling expenses were 31.0% of net revenue, or $85.43 per barrel, for the year ended December 27, 2025, as compared to 27.4% of net revenue, or $73.67 per barrel, for the year ended December 28, 2024.
Net revenue increased by $4.3 million, or 0.2%, to $2,012.9 million for the year ended December 28, 2024, as compared to $2,008.6 million for the year ended December 30, 2023, due to price increases of $38.3 million and lower returns of $13.0 million, partially offset by the impact of lower shipment volume of $48.3 million. Volume.
Net revenue decreased by $47.9 million, or 2.4%, to $1,965.0 million for the year ended December 27, 2025, as compared to $2,012.9 million for the year ended December 28, 2024, primarily due to decreased sales volume impacts of $94.8 million, partially offset by increased pricing of $27.1 million, and favorable product mix of $19.1 million. Volume.
General and administrative expenses increased by $15.4 million, or 8.8%, to $189.9 million for the year ended December 28, 2024, as compared to $174.5 million for the comparable period in 2023.
General and administrative expenses increased by $0.9 million, or 0.5%, to $190.8 million for the year ended December 27, 2025, as compared to $189.9 million for the comparable period in 2024. The increase was primarily due to higher salaries and benefits costs. Impairment of intangible assets. In fiscal 2025, the Company recorded no impairment charges related to intangible assets.
The Company’s annual goodwill impairment evaluation analysis conducted at the end of fiscal August indicated that the fair value of the Company’s goodwill was substantially greater than the carrying value and accordingly there was no impairment to record during fiscal 2024.
As of the annual impairment assessments conducted at the end of fiscal August 2025 and 2024, the estimated fair value of the reporting unit substantially exceeded its carrying value, and no goodwill impairment was recorded.
Impairment of intangible assets reflects a $42.6 million non-cash impairment charge recorded for the Dogfish Head brand, taken as a result of the Company’s annual impairment analysis as of September 1, 2024. The impairment determination was primarily based on the latest forecasts of brand performance which have been below the Company’s previous projections.
In fiscal 2024, the Company recorded a $42.6 million non‑cash impairment charge ($29.1 million net of tax) primarily related to the Dogfish Head brand, based on the Company’s annual impairment assessment performed as of September 1, 2024.
The guidance for goodwill impairment testing allows an entity to assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the estimated fair value of a reporting unit, of which the Company has one, is less than its carrying amount or to proceed directly to performing a quantitative impairment test.
In accordance with ASC 350, the Company may first perform a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value, or it may elect to perform a quantitative impairment test.
Accordingly, the Company obtains the assistance of third-party valuation specialists as part of the impairment evaluation. In estimating the fair value of the trademark, management must make assumptions and projections regarding future cash flows based upon future revenues, the market-based royalty rate, the discount rate, and the after-tax royalty savings expected from ownership of the trademark.
Estimating the fair value of the trademark requires significant judgment and the use of assumptions related to projected future revenues, market‑based royalty rates, discount rates, and the after‑tax royalty savings attributable to ownership of the trademark. The Company uses third‑party valuation specialists to assist in this assessment.
The assumptions and projections used in the estimate of fair value are consistent with recent trends and represent the projections used in Company’s current strategic operating plans which include reductions in revenues from the Dogfish Head beer products.
The assumptions applied are consistent with recent performance trends and the Company’s current strategic operating plans, which include reduced revenue expectations for Dogfish Head beer products. These assumptions are sensitive to changes in macroeconomic conditions, industry growth, and competitive dynamics.
The Company’s effective tax rate for fiscal 2024 was 31.9% compared to 30.2% in fiscal 2023, primarily due to lower pre-tax income with no corresponding reduction in non-deductible expenses. The Company estimates the lower pre-tax income resulting from the impairment of intangible assets and the contract settlement negatively impacted the 2024 effective tax rate by approximately 300 basis points.
Income tax provision. The Company’s effective tax rate for fiscal 2025 was 29.3% compared to 31.9% in fiscal 2024, primarily due to higher pre-tax net income and a lower negative impact of non-deductible expenses.
If these estimates or their related assumptions change in the future, the Company may be required to recognize an impairment loss for the Company’s goodwill which could have a material adverse impact on the Company’s financial statements. The Company’s intangible assets consist primarily of a trademark and customer relationships obtained through the Company’s Dogfish Head acquisition.
Adverse changes in key assumptions or market conditions could result in future impairment charges that could have a material effect on the Company’s financial condition and results of operations. The Company’s identifiable intangible assets consist primarily of a trademark and customer relationships acquired in connection with the Dogfish Head acquisition.
The Company performed a sensitivity analysis on its significant assumptions used in the Dogfish Head trademark fair value calculation as of September 28, 2024 and determined the following : • A decrease in the annual forecasted revenue growth rate of 1.0% would result in a 4.9% decrease to the fair value of $14.4 million as of September 28, 2024. • A decrease in the discount rate of 1.5% would result in a 8.3% increase to the fair value of $14.4 million as of September 28, 2024, and an increase in the discount rate of 1.5% would result in a 6.9% decrease to the fair value of $14.4 million as of September 28, 2024. 34 Revenue Recognition and Classification of Customer Programs and Incentives The Company recognizes revenue when obligations under the terms of a contract with its customer are satisfied; generally, this occurs with the transfer of control of its products.
This change in estimated useful life was accounted for prospectively. 34 Revenue Recognition and Classification of Customer Programs and Incentives The Company recognizes revenue when obligations under the terms of a contract with its customer are satisfied; generally, this occurs with the transfer of control of its products.
Removed
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The Company has elected to omit discussion of the earliest of the three years covered by the consolidated financial statements presented. Refer to Item 7.
Added
The increase was primarily driven by higher media spend of $27.0 million, increased local marketing of $10.7 million, higher production and other non‑media costs of $7.6 million, increased point‑of‑sale investments of $5.9 million, increased national promotions of $4.3 million, and higher salaries and benefits of $4.3 million.
Removed
"Management's Discussion and Analysis of Financial Condition and Results of Operations" located in the Company's Form 10-K for the fiscal year ended December 30, 2023, filed on February 27, 2024, for reference to discussion of the fiscal year ended December 31, 2022, the earliest of the three fiscal years presented.
Added
The third-party production prepayments decrease of $7.4 million is due to a full year amortization of these prepayments during 2025, decreasing the prepaid balance from $14.5 million as of December 28, 2024 to $7.1 million as of December 27, 2025.
Removed
The increase was primarily due to higher salaries and benefits costs resulting from Chief Executive Officer transition costs recorded in the first quarter as well as increased inflationary costs. 31 Impairment of intangible assets.
Added
Intangible assets are classified as either indefinite‑lived or finite‑lived. Goodwill and indefinite‑lived intangible assets are not amortized but are assessed for impairment at least annually, or more frequently if events or changes in circumstances indicate that the carrying amount may not be recoverable.
Removed
In fiscal 2023, the Company recorded an impairment charge of $16.4 million primarily for the Dogfish Head brand. See further discussion in Note H to the Consolidated Financial Statements within Part II, Item 8 of this Form 10-K. Impairment of brewery assets.
Added
Finite‑lived intangible assets are amortized over their estimated useful lives and evaluated for impairment when indicators are present. The Company performs its annual goodwill impairment assessment in the third quarter of each fiscal year and evaluates goodwill on an interim basis if triggering events occur. The Company has one reporting unit.
Removed
The inventory decrease of $31.5 million is due to improvements in supply chain process resulting in lower inventory levels and lower volumes. The third-party production prepayments decrease of $27.8 million is due to expensing of these prepayments over the respective contract terms.
Added
These valuation techniques require significant management judgment, including assumptions related to projected revenues, future cash flows, operating margins, cost of capital, and long‑term growth rates. These assumptions are derived from historical performance, current operating plans, and management’s expectations regarding future economic and competitive conditions.
Removed
The Company expects that its cash balance as of December 28, 2024 of $211.8 million and future operating cash flows, along with its $150.0 million credit facility agreement, will be sufficient to fund future cash requirements.
Added
Customer relationships are finite‑lived and are amortized over their estimated useful lives.
Removed
The Company performs its annual impairment tests and re-evaluates the useful lives of other intangible assets with indefinite lives at the annual impairment test measurement date in the third quarter of each fiscal year or when circumstances arise that indicate a possible impairment or change in useful life might exist.
Added
From the acquisition date through the annual impairment assessment conducted at the end of fiscal August 2024, the Dogfish Head trademark was classified as an indefinite‑lived intangible asset based on management’s determination that there were no legal, regulatory, contractual, competitive, or economic factors limiting its expected period of benefit.
Removed
If the estimated fair value of the Company’s reporting unit is less than the carrying value of its reporting unit, a goodwill impairment will be recognized. In estimating the fair value of the Company’s reporting unit, management must make assumptions and projections regarding such items as future cash flows, future revenues, future earnings, cost of capital, and other factors.
Added
As an indefinite‑lived asset, the trademark was not amortized and was tested annually for impairment. The Company’s impairment evaluation of the trademark follows ASC 350, under which management may first perform a qualitative assessment or proceed directly to a quantitative impairment test.
Removed
The assumptions used in the estimate of fair value are based on historical trends and the projections and assumptions that are used in the latest operating plans. These assumptions reflect management’s estimates of future economic and competitive conditions and are, therefore, subject to change as a result of changing market conditions.
Added
Beginning in the fourth quarter of fiscal 2024, management reassessed the expected useful life of the Dogfish Head trademark and concluded that it no longer met the criteria for indefinite‑lived classification due to changes in qualitative factors affecting the expected period of economic benefit. As a result, the trademark was reclassified as a finite‑lived intangible asset.
Removed
Customer relationships are amortized over their estimated useful lives. As of the annual impairment assessment date at the end of fiscal August, the Dogfish Head trademark was determined to have a indefinite useful life and was not amortized.
Added
Effective in the fourth quarter of fiscal 2024, the Company began amortizing the trademark’s remaining carrying value of $14.4 million over an estimated useful life of 10 years on a straight‑line basis.
Removed
The guidance for indefinite lived intangible asset impairment testing allows an entity to assess qualitative factors to determine whether the existence of events or circumstances indicates that it is more likely than not that the indefinite lived intangible asset is impaired or to proceed directly to performing the quantitative impairment test.
Removed
If the estimated fair value is less than the carrying value of the trademark, then an impairment charge is recognized to reduce the carrying value of the trademark to its estimated fair value. Significant judgment is required to estimate the fair value of the Dogfish Head trademark.
Removed
These assumptions reflect management’s estimates of future economic and competitive conditions and consider many factors including macroeconomic conditions, industry growth rates, and competitive activities and are, therefore, subject to change as a result of changing market conditions.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

5 edited+1 added−0 removed1 unchanged
The cost of these commitments changes as foreign exchange rates fluctuate. Currently, it is not the Company’s policy to hedge against foreign currency fluctuations. The interest rate for borrowings under the Company’s credit facility is based on the applicable secured overnight financing rate ("SOFR") plus 1.1%, and therefore, subjects the Company to fluctuations in such rates.
The cost of these commitments changes as foreign exchange rates fluctuate. Currently, it is not the Company’s policy to hedge against foreign currency fluctuations. 36 The interest rate for borrowings under the Company’s credit facility is based on the applicable secured overnight financing rate ("SOFR") plus 1.1%, and therefore, subjects the Company to fluctuations in such rates.
As such factors cannot be predicted, the actual impact on earnings due to an adverse change in the respective rates could vary substantially from the amounts calculated above.
As such factors cannot be predicted, the actual impact on earnings due to an adverse change in the respective rates could vary substantially from the amounts calculated above. 37
A potential adverse fluctuation in foreign currency exchange rates could negatively impact future cash flows by approximately $2.5 million as of December 28, 2024. There are many economic factors that can affect volatility in foreign exchange rates.
A potential adverse fluctuation in foreign currency exchange rates could negatively impact future cash flows by approximately $2.3 million as of December 27, 2025. There are many economic factors that can affect volatility in foreign exchange rates.
At December 28, 2024, the applicable SOFR was 4.5%. As of December 28, 2024, the Company had no amounts outstanding under its current line of credit. Sensitivity Analysis The Company applies a sensitivity analysis to reflect the impact of a 10% hypothetical adverse change in the foreign currency exchange rates.
At December 27, 2025, the applicable SOFR was 3.76%. As of December 27, 2025, the Company had no amounts outstanding under its current line of credit. Sensitivity Analysis The Company applies a sensitivity analysis to reflect the impact of a 10% hypothetical adverse change in the foreign currency exchange rates.
Market risk sensitive instruments include derivative financial instruments, other financial instruments and derivative commodity instruments, such as futures, forwards, swaps and options, that are exposed to rate or price changes. 36 The Company enters into hops purchase contracts, as described in Note M to the Consolidated Financial Statements within Part II, Item 8 of this Form 10-K, and makes purchases of other ingredients, equipment, and machinery and payments for commissions and marketing services to an international sales agent denominated in foreign currencies.
The Company enters into hops purchase contracts, as described in Note M to the Consolidated Financial Statements within Part II, Item 8 of this Form 10-K, and makes purchases of other ingredients, equipment, and machinery and payments for commissions and marketing services to an international sales agent denominated in foreign currencies.
Added
Market risk sensitive instruments include derivative financial instruments, other financial instruments and derivative commodity instruments, such as futures, forwards, swaps and options, that are exposed to rate or price changes.

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