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What changed in Blue Bird Corp's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Blue Bird Corp's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+335 added−309 removedSource: 10-K (2025-11-24) vs 10-K (2024-11-25)

Top changes in Blue Bird Corp's 2025 10-K

335 paragraphs added · 309 removed · 251 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

70 edited+11 added−9 removed85 unchanged
Biggest changeWe believe our leadership in alternative power options, coupled with this external funding, provides a strong foundation to continue to increase sales of our propane, gasoline and electric powered bus platforms. 8 Our Competitive Strengths We believe that our competitive strengths are derived from the following factors: Reputation for safety, product quality/reliability/durability, and drivability .
Biggest changeHowever, Blue Bird has updated its plans to increase its own investment in the project to allow for an expanded facility that will further its capabilities to continue producing buses containing all powertrains offered, including, but not limited to, electric and low-emissions vehicles, as demanded by the market, and to continue and expand domestic manufacturing operations in Fort Valley, Georgia. 8 We believe our leadership in alternative power options, coupled with this external funding, provides a strong foundation to continue to increase sales of our propane, gasoline and electric powered bus platforms.
In 2020, countermeasures taken to battle the the novel coronavirus known as "COVID-19" included virtual and hybrid schooling in many jurisdictions throughout the U.S. and Canada.
In 2020, countermeasures taken to battle the novel coronavirus known as "COVID-19" included virtual and hybrid schooling in many jurisdictions throughout the U.S. and Canada.
All paint over spray is captured, dried and sent to a power generation plant to be used as fuel. • During fiscal 2023, we opened the new Electric Vehicle Build-up Center, a transformed 40,000 square foot facility at the Fort Valley, Georgia manufacturing plant, designed to meet increasing demand for electric school buses. • During fiscal 2024, the U.S.
All paint over spray is captured, dried and sent to a power generation plant to be used as fuel. 4 • During fiscal 2023, we opened the new Electric Vehicle Build-up Center, a transformed 40,000 square foot facility at the Fort Valley, Georgia manufacturing plant, designed to meet increasing demand for electric school buses. • During fiscal 2024, the U.S.
Purchases of school buses are typically made through a bid process at the district or state level, with dealers coordinating this process. Dealers develop collaborative relationships with school districts, district transportation directors, and key officials in their states. Our dealers have access to financing through a financing product maintained by an independent third party, Huntington Distribution Finance, Inc. ("Huntington").
Purchases of school buses are typically made through a bid process at the district or state level, with dealers coordinating this process. Dealers develop collaborative relationships with school districts, district transportation directors, and key officials in their states. 9 Our dealers have access to financing through a financing product maintained by an independent third party, Huntington Distribution Finance, Inc. ("Huntington").
Financial information is reported on the basis that it is used internally by the chief operating decision maker (“CODM”) in evaluating segment performance and deciding how to allocate resources to segments. The President and Chief Executive Officer of the Company has been identified as the CODM. Management evaluates the segments based primarily upon revenues and gross profit.
Financial information is reported on the basis that it is used internally by the chief operating decision maker (“CODM”) in evaluating segment performance and deciding how to allocate resources to segments. The President and Chief Executive Officer ("CEO") of the Company has been identified as the CODM. Management evaluates the segments based primarily upon revenues and gross profit.
Using robotic technology, the paint facility is designed to paint a bus three times faster than can be done manually, with a higher paint transfer rate and 4 consistent, outstanding coverage. In keeping with Blue Bird's environmental awareness focus, the facility features a zero-to-landfill design.
Using robotic technology, the paint facility is designed to paint a bus three times faster than can be done manually, with a higher paint transfer rate and consistent, outstanding coverage. In keeping with Blue Bird's environmental awareness focus, the facility features a zero-to-landfill design.
Export Dealers . We regularly monitor opportunities to sell our Type C and Type D buses in either school bus or other configurations in certain limited international markets and typically sell these products through dealers assigned to those territories. U.S. Government; Other Specialty Sales . We also sell buses through our U.S.
We regularly monitor opportunities to sell our Type C and Type D buses in either school bus or other configurations in certain limited international markets and typically sell these products through dealers assigned to those territories. U.S. Government; Other Specialty Sales . We also sell buses through our U.S.
Although management began to see improvements in the challenges caused by supply chain disruptions during fiscal 2023 and continuing into fiscal 2024, there were still occasional shortages of certain components, as well as ongoing volatility in raw materials costs.
Although management began to see improvements in the challenges caused by supply chain disruptions during fiscal 2023 and continuing into fiscal 2024 and fiscal 2025, there were still occasional shortages of certain components, as well as ongoing volatility in raw materials costs.
Additionally, during fiscal 2023, we opened the new Electric Vehicle Build-up Center, a transformed 40,000 square foot facility at the Fort Valley, Georgia manufacturing plant, designed to meet increasing demand for electric school buses. Innovative product leadership .
Additionally, during fiscal 2023, we opened the Electric Vehicle Build-up Center, a transformed 40,000 square foot facility at the Fort Valley, Georgia manufacturing plant, designed to meet increasing demand for electric school buses. Innovative product leadership .
As a result of ongoing supply chain disruptions that began in the latter half of fiscal 2021 and continued through fiscal 2024, we have experienced supplier shortages, which were significant at times, of critical components, which prevented the Company from initiating or completing, as applicable, the production process for certain units that were otherwise scheduled to be delivered to customers during fiscal 2021, fiscal 2022 and, to a lesser extent, fiscal 2023 and fiscal 2024.
As a result of ongoing supply chain disruptions that began in the latter half of fiscal 2021 and continued through fiscal 2025, we have experienced supplier shortages, which were significant at times, of critical components, which prevented the Company from initiating or completing, as applicable, the production process for certain units that were otherwise scheduled to be delivered to customers during fiscal 2021, fiscal 2022 and, to a lesser extent, fiscal 2023 through fiscal 2025.
Specifically, $2.5 billion of the funds are allocated solely for the purchase of electric powered buses, while the remaining $2.5 billion of funds are allocated for the purchase of low and zero-emission school buses, including buses that are propane or electric powered.
Specifically, $2.5 billion of the funds were allocated solely for the purchase of electric powered buses, while the remaining $2.5 billion of funds were allocated for the purchase of low and zero-emission school buses, including buses that are propane or electric powered.
Blue Bird will also begin implementing high-tech systems to improve vehicle safety, including collision mitigation systems being added to the currently-standard electronic stability control ("ESC"). 4.
Blue Bird will also begin implementing high-tech systems to improve vehicle safety, including collision mitigation systems being added to the currently-standard electronic stability control. 4.
We benefit from a highly-skilled, committed hourly workforce of approximately 1,613 employees who support our customized assembly operations at our 900,000 square foot integrated chassis manufacturing and body assembly facility and 340,000 square foot component fabrication facility. Our employees are trained to maximize production efficiency by following customized processes developed by us. Strong management team .
We benefit from a highly-skilled, committed hourly workforce of approximately 1,640 employees who support our customized assembly operations at our 900,000 square foot integrated chassis manufacturing and body assembly facility and 340,000 square foot component fabrication facility. Our employees are trained to maximize production efficiency by following customized processes developed by us. Strong management team .
The foregoing information regarding content on our website is for convenience only and is not deemed to be incorporated by reference into this Report or filed with the SEC. Overview We are the leading independent designer and manufacturer of school buses, with more than 610,000 buses sold since our formation in 1927.
The foregoing information regarding content on our website is for convenience only and is not deemed to be incorporated by reference into this Report or filed with the SEC. Overview We are the leading independent designer and manufacturer of school buses, with more than 619,000 buses sold since our formation in 1927.
New and even stricter emission standards will take effect in 2027, with our near zero-emission, propane powered school buses already exceeding those emission standards currently. • Electric — Blue Bird is the first major school bus manufacturer to market, and presently the clear leader in, electric bus sales among all major original equipment manufacturers ("OEM").
New and even stricter emission standards will take effect in 2027, with our near zero-emission, propane powered school buses already exceeding those emission standards currently. • Electric — Blue Bird is the first major school bus manufacturer to market, and we believe is presently the clear leader in, electric bus sales among all major original equipment manufacturers ("OEM").
Alternative Power Initiatives — We believe Blue Bird is the clear leader in alternative powered school buses (defined as buses that do not operate on diesel fuel) and we continue to introduce new or enhanced products to support growing consumer demand for these products. • Propane and Gasoline — In fiscal 2024, we extended our exclusive clean school bus collaboration with Ford Component Sales and Roush CleanTech to 2030, further strengthening Blue Bird’s industry leadership in low- and zero-emission student transportation.
Alternative Power Initiatives — We believe Blue Bird is the clear leader in alternative powered school buses (defined as buses that do not operate on diesel fuel) and we continue to introduce new or enhanced products to support growing consumer demand for these products. • Propane and Gasoline — In fiscal 2024, we extended our exclusive collaboration with Ford Component Sales and Roush CleanTech for cleaner powered school buses to 2030, further strengthening Blue Bird’s industry leadership in low- and zero-emission student transportation.
All 50 States, the District of Columbia, and the 13 Canadian Provinces and Territories have fleets of school buses in operation. Bus Segment Our buses are sold through an extensive network of 45 U.S. and Canadian dealer locations that, in their territories, are exclusive to our Company on Type C and Type D school buses.
All 50 States, the District of Columbia, and the 13 Canadian Provinces and Territories have fleets of school buses in operation. Bus Segment Our buses are sold through an extensive network of 44 U.S. and Canadian dealer locations that, in their territories, are exclusive to our Company on Type C and Type D school buses.
For further details and discussion about the impact of these supply chain disruptions, refer to the "Impact of Supply Chain Constraints on Our Business" section of Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations." 10 Competition The U.S. and Canadian school bus industry is highly competitive.
For further details and discussion about the impact of these supply chain disruptions, refer to the "Impact of Supply Chain Constraints on Our Business" section of Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" of this Report. 10 Competition The U.S. and Canadian school bus industry is highly competitive.
Our dealers have an average tenure of more than 30 years with us and do not sell competing Type C or Type D school bus products in the areas assigned to them by us. Highly-skilled and committed workforce .
Our dealers have an average tenure of more than 34 years with us and do not sell competing Type C or Type D school bus products in the areas assigned to them by us. Highly-skilled and committed workforce .
We do not assume any balance sheet risk with respect to this type of financing and do not receive any direct economic benefit from Huntington. 9 Other Distribution Channels Fleet Operators . We also sell school buses directly to large national fleets that span multiple states and such sales are managed internally by our National Account Sales Team.
We do not assume any balance sheet risk with respect to this type of financing and do not receive any direct economic benefit from Huntington. Other Distribution Channels Fleet Operators . We also sell school buses directly to large national fleets that span multiple states and such sales are managed internally by our National Account Sales Team. Export Dealers .
Excluding the isolated incident that impacted industry sales during 2024 that management does not believe is indicative of decreased demand in the school bus industry, the low point in the industry occurred in 2011, at approximately 23,800 units, and was the result of the decline in the U.S. economy and, in particular, the collapse of the housing market in 2008 and 2009.
Excluding the isolated incident discussed previously above that impacted industry sales during 2024 that management does not believe is indicative of decreased demand in the school bus industry, the low point in the industry occurred in 2011, at approximately 23,800 units, and was the result of the decline in the U.S. economy and, in particular, the collapse of the housing market in 2008 and 2009.
We are the only principal manufacturer with chassis and body production specifically designed for school bus applications in the U.S. and the only school bus company to offer as a standard feature compliance with industry recognized safety tests - Altoona Testing, Colorado Rack Test and the Kentucky Pole Test - as a standard specification across our entire product line.
We are the only principal manufacturer with chassis and body production specifically designed for school bus applications in the U.S. and the only school bus company to offer as a standard feature compliance with certain industry recognized safety tests - Colorado Rack Test and the Kentucky Pole Test - as a standard specification across our entire product line.
On May 22, 2023, the National Labor Relations Board (“NLRB”) certified the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied & Industrial Service Workers International Union, AFL-CIO, CLC (“USW”) as the exclusive bargaining representative for a bargaining unit of the Company’s full-time and regular part-time production, maintenance, quality control, and warehouse employees at the Company’s Fort Valley and Macon, Georgia locations, with certain exceptions.
On May 22, 2023, the National Labor Relations Board (“NLRB”) certified the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied & Industrial Service Workers International Union, AFL-CIO, CLC (“USW”) as the exclusive bargaining representative for a bargaining unit of the Company’s full-time and regular part-time production, maintenance, quality control, and warehouse employees at the Company’s Fort Valley and Macon, Georgia locations (with the Macon, Georgia warehouse subsequently relocated to Perry, Georgia), with certain exceptions.
Through the Bipartisan Infrastructure Law, the CSBP provides $5 billion in funding over five years to school districts and fleet operators to replace existing school buses with zero-emission and low-emission models.
Through the Bipartisan Infrastructure Law, the CSBP provided $5 billion in funding over five years to school districts and fleet operators to replace existing school buses with zero-emission and low-emission models.
Also, in August 2022, the Inflation Reduction Act ("IRA") was signed into law. The IRA authorizes a $369 billion investment in energy security and combating climate change.
Also, in August 2022, the Inflation Reduction Act ("IRA") was signed into law. The IRA authorized a $369 billion investment in energy security and combating climate change.
We also sell directly to major fleet operators, the U.S. government, state governments and authorized dealers in certain limited foreign countries. In fiscal 2024, we sold 9,000 buses throughout the world. Refer to “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” for discussion of our unit volumes.
We also sell directly to major fleet operators, the U.S. government, state governments and authorized dealers in certain limited foreign countries. In fiscal 2025, we sold 9,409 buses throughout the world. Refer to “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” for discussion of our unit volumes.
The demand for Blue Bird’s propane powered school buses has steadily increased over the past decade. Our propane engine is 90 percent cleaner than the most stringent current federal emission standards set by the United States of America ("U.S.") Environmental Protection Agency ("EPA").
The demand for Blue Bird’s propane powered school buses has steadily increased over the past decade. Our propane engine is 90 percent cleaner than the most stringent current federal emission standards set by the U.S. Environmental Protection Agency ("EPA").
Throughout this Report, we refer to the fiscal year ended September 28, 2024 as “fiscal 2024,” the fiscal year ended September 30, 2023 as “fiscal 2023” and the fiscal year ended October 1, 2022 as “fiscal 2022.” There were 52 weeks in fiscal 2024, fiscal 2023, and fiscal 2022. 3 Our performance in recent years has been driven by the implementation of repeatable processes focused on product initiatives, continuous improvement of both competitiveness and manufacturing flexibility, and lowering our cost of capital, as described below: 1.
Throughout this Report, we refer to the fiscal year ended September 27, 2025 as “fiscal 2025,” the fiscal year ended September 28, 2024 as “fiscal 2024” and the fiscal year ended September 30, 2023 as “fiscal 2023.” There were 52 weeks in fiscal 2025, fiscal 2024, and fiscal 2023. 3 Our performance in recent years has been driven by the implementation of repeatable processes focused on product initiatives, continuous improvement of both competitiveness and manufacturing flexibility, and lowering our cost of capital, as described below: 1.
In fiscal 2016, years ahead of our competition, we launched the industry's first gasoline powered Type C bus (utilizing an exclusive Ford engine and transmission and Roush CleanTech fuel usage evaporative emissions certification) and we were first-to-market with electronic stability control.
In the Company's fiscal year ended October 1, 2016 ("fiscal 2016"), years ahead of our competition, we launched the industry's first gasoline powered Type C bus (utilizing an exclusive Ford engine and transmission and Roush CleanTech fuel usage evaporative emissions certification) and we were first-to-market with electronic stability control.
For example, in California, the Zero Emission School Bus and Infrastructure program allocated $375 million for qualifying zero-emission school buses and $125 million for infrastructure and associated costs. In New York, the New York School Bus Incentive Program provided $300 million to fund the acquisition of new electric school buses and charging infrastructure.
For example, in California, the Zero Emission School Bus and Infrastructure program allocated $375 million for qualifying zero-emission school buses and $125 million for infrastructure and associated costs. In New York, the New York School Bus Incentive Program provided $500 million to fund the acquisition of new electric school buses and charging infrastructure beginning in 2022.
We regularly perform supplier audits and, when necessary, will meet with under-performing suppliers in order to enhance performance. At September 28, 2024, we had in place long-term supply contracts (addressing both component price and supply) covering approximately 85% of the value of our purchases from suppliers, including long-term agreements with our major single-source suppliers.
We regularly perform supplier audits and, when necessary, will meet with under-performing suppliers in order to enhance performance. At September 27, 2025, we had in place long-term supply contracts (addressing both component price and supply) covering approximately 65% of the value of our purchases from suppliers, including long-term agreements with our major single-source suppliers.
Parts Segment Parts are key for routine maintenance, replacement of parts that are damaged in service, and replacement of parts that suffer from wear and tear throughout the useful life of the vehicle. 5 In fiscal 2024, parts sales represented 7.7% of Company net sales.
Parts Segment Parts are key for routine maintenance, replacement of parts that are damaged in service, and replacement of parts that suffer from wear and tear throughout the useful life of the vehicle. In fiscal 2025, parts sales represented 7.0% of Company net sales.
Approximately 91% of our buses sold in fiscal 2024 were sold through distributors and dealers. The Company holds no equity or control position in any of the distributors or dealers. We design, engineer, manufacture, and sell three types of buses: (i) Type C school buses, (ii) Type D school buses, and (iii) specialty buses.
Approximately 92.6% of our buses sold in fiscal 2025 were sold through distributors and dealers. The Company holds no equity or control position in any of the distributors or dealers. We design, engineer, manufacture, and sell three types of buses: (i) Type C school buses, (ii) Type D school buses, and (iii) specialty buses.
In January 2024, the EPA announced the recipients of the second round of funding for the CSBP, which awarded nearly $1 billion in the form of competitive grants to 280 school districts and will help award recipients purchase over 2,700 clean school buses, 95% of which will be electric.
In January 2024, the EPA announced the recipients of the second round of funding for the CSBP, which awarded nearly $1 billion in the form of competitive grants to over 230 school districts that will help award recipients purchase approximately 2,700 clean school buses, over 95% of which will be electric.
Nonetheless, subsequent supply chain shortages for certain components, such as microchips and products containing resins, that are critical to the manufacture of school buses, depressed sales during the latter half of fiscal 2021 and throughout fiscal 2022.
Nonetheless, subsequent supply chain shortages for certain components, such as microchips and products containing resins, that are critical to the manufacture of school buses, depressed sales during the latter half of fiscal 2021 and throughout the Company's fiscal year ended October 1, 2022 ("fiscal 2022").
In October 2022, the EPA announced the awarding of approximately $965 million as part of its first round of funding for the CSBP. Over 2,300 zero- and low-emission school buses were ordered by award recipients during the first round, of which the Company received orders for over 500 school buses.
In October 2022, the EPA announced the awarding of approximately $965 million as part of its first round of funding for the CSBP, with approximately $865 million actually awarded to-date. Over 2,300 zero- and low-emission school buses were ordered by award recipients during the first round, of which the Company received orders for over 500 school buses.
We have built an extensive, experienced network of 45 dealer locations to distribute our buses across the U.S. and Canada, and during recent years have significantly enhanced our relationships with large fleet operators.
Strong distribution model . We have built an extensive, experienced network of 44 dealer locations to distribute our buses across the U.S. and Canada, and during recent years have significantly enhanced our relationships with large fleet operators.
Our Micro Bird joint venture leases its facility (0.2 million square feet) in Drummondville, Quebec, Canada. Intellectual Property and Technology We seek trademark protection in the U.S. and outside of the U.S. where available and when appropriate.
Our Micro Bird joint venture leases its facilities in Drummondville, Quebec, Canada (approximately 0.2 million square feet) and Plattsburgh, New York (approximately 0.2 million square feet). Intellectual Property and Technology We seek trademark protection in the U.S. and outside of the U.S. where available and when appropriate.
Management understands that this decrease primarily resulted from one of the Company's primary competitors experiencing significant challenges associated with a new product launch that impacted the units that it could manufacture and deliver as it sold approximately 4,700 fewer units during the period from April 2024 through September 2024 when compared with the comparable period in the previous year.
Management understands that in the second half of 2024, one of the Company's primary competitors experienced significant challenges associated with a new product launch that impacted the units that it could manufacture and deliver, as it sold approximately 4,700 fewer units during the period from April 2024 through September 2024 when compared with the comparable period in the previous year.
Our Dealer Network In fiscal 2024, we sold approximately 91% of our vehicles through our U.S. and Canadian dealer network, currently consisting of 45 dealer locations that, in their territories, are exclusive to us with Type C and D school buses.
Our Dealer Network In fiscal 2025, we sold approximately 92.6% of our vehicles through our U.S. and Canadian dealer network, currently consisting of 44 dealer locations that, in their territories, are exclusive to us with Type C and D school buses.
Our Type C school bus accounted for 79% of unit sales and our Type D school bus accounted for 19% of unit sales. GSA and export buses, which can be ordered with either the Type C or Type D chassis, accounted for the remaining 2% of unit sales.
Our Type C school bus accounted for 82% of unit sales and our Type D school bus accounted for 14% of unit sales. GSA and export buses, which can be ordered with either the Type C or Type D chassis, accounted for the remaining 4% of unit sales.
Alternative powered bus leadership . We believe we are the market leader in propane, gasoline and electric powered buses, having sold approximately 64% of all alternative powered school buses from fiscal 2015 through fiscal 2024. In fiscal 2024, we sold 5,213 propane, gasoline, compressed natural gas ("CNG") and electric powered buses, as market demand for alternative powered buses remained robust.
Alternative powered bus leadership . We believe we are the market leader in propane, gasoline and electric powered buses, having sold approximately 64% of all alternative powered school buses from fiscal 2015 through fiscal 2025. In fiscal 2025, we sold 5,275 propane, gasoline and electric powered buses, as market demand for alternative powered buses remained robust.
For the first time in student transportation history, new Blue Bird buses will be equipped with three-point seat belts as standard protection for all student passengers. Other seat options will still be available to meet specific customer needs.
For the first time in student transportation history, new Blue Bird buses are equipped with three-point seat belts as standard protection for all student passengers, starting in the first quarter of fiscal 2025. Other seat options are still available to meet specific customer needs.
In May 2024, a three year collective bargaining agreement ("CBA") was executed with the USW, which covers more than 1,500 employees as of September 28, 2024.
In May 2024, a three year collective bargaining agreement ("CBA") was executed with the USW, which covers more than 1,580 employees as of September 27, 2025. 13
We are led by a highly experienced and committed management team with an established track record in the U.S. and Canadian school bus and heavy-duty vehicle industries. Sales Volume In fiscal 2024, we sold 9,000 Type C and Type D buses, including 8,844 school buses, 1 export bus and 155 Government Services Administration ("GSA") buses.
We are led by a highly experienced and committed management team with an established track record in the U.S. and Canadian school bus and heavy-duty vehicle industries. Sales Volume In fiscal 2025, we sold 9,409 Type C and Type D buses, including 9,025 school buses and 384 Government Services Administration ("GSA") buses.
We believe that (i) since the start of the pandemic and continuing through the subsequent period that has been significantly impacted by supply chain disruptions (i.e., the cumulative period beginning in the last half of fiscal 2020 and continuing through fiscal 2024), the industry has been operating below its historical long-term average of approximately 30,400 unit sales per year, and (ii) there are over 148,000 buses in the U.S. and Canadian fleets that have been in service for 15 or more years. 7 Local property and municipal tax receipts are key drivers of school district transportation budgets.
We believe that (i) since the start of the pandemic and continuing through the subsequent period that has been significantly impacted by supply chain disruptions (i.e., in particular, the cumulative period beginning in the last half of fiscal 2020 and continuing through fiscal 2024), the industry has been operating below its historical long-term average of approximately 30,500 unit sales per year, and (ii) there are over 145,000 buses in the U.S. and Canadian fleets that have been in service for 15 or more years.
The Company’s leaders and managers continuously address safety enhancements, provide regular and ongoing safety training, and use displays located near our employee work areas to provide all employees with safety-related information. 13 Employees At September 28, 2024, we employed 1,948 employees, of which 1,945 were full-time.
The Company’s leaders and managers continuously address safety enhancements, provide regular and ongoing safety training, and use displays located near our employee work areas to provide all employees with safety-related information. Employees At September 27, 2025, we employed 2,012 employees, of which 2,008 were full-time.
In May 2024, the EPA announced the recipients of the third round of funding for the CSBP, which awarded nearly $900 million in rebates to 530 school districts and will fund over 3,400 zero- and low-emission school buses, 92% of which will be electric.
In May 2024, the EPA announced the recipients of the third round of funding for the CSBP, which awarded over $800 million in rebates to nearly 450 school districts that will fund over 3,200 zero- and low-emission school buses, approximately 88% of which will be electric.
The Company and its dealer network submitted grant applications on behalf of certain school district customers and also assisted certain other school district customers with completing and submitting their own grant applications. To date, the Company has received over 230 orders for school buses with many of the award recipients yet to spend their funding.
The Company and its dealer network submitted grant applications on behalf of certain school district customers and also assisted certain other school district customers with completing and submitting their own grant applications. To date, the Company has received over 440 orders for both propane and electric powered school buses.
In addition to strong property tax collections, additional funding for school buses is being made available through federal funding programs, including the DOE’s Diesel Emissions Reduction Act ("DERA") and the EPA’s Clean School Bus Program ("CSBP").
In addition to strong property tax collections, additional funding for school buses is being made available through federal funding programs, including, but not limited to, the EPA’s Clean School Bus Program ("CSBP").
In fiscal 2018, we sold our first Type D electric vehicles and in the fiscal year ended September 28, 2019 ("fiscal 2019"), we introduced our Type C electric vehicle. In fiscal 2024, we sold 704 Type C and Type D electric vehicles, an increase of 28.9% when compared with prior year. Strong distribution model .
In the Company's fiscal year ended September 29, 2018 ("fiscal 2018"), we sold our first Type D electric vehicles and in the fiscal year ended September 28, 2019 ("fiscal 2019"), we introduced our Type C electric vehicle. In fiscal 2025, we sold 901 Type C and Type D electric vehicles, an increase of 28.0% when compared with prior year.
The U.S. and Canadian school bus industry for Type C and Type D buses has averaged approximately 30,400 unit sales annually (for the period from October through September of the subsequent year) between 1985 and 2024. Unit sales for 2024 are projected to be about 23,700, a decrease of 18.3% when compared with 2023.
The U.S. and Canadian school bus industry for Type C and Type D buses has averaged approximately 30,500 unit sales annually (for the period from October through September of the subsequent year) between 1985 and 2025. Unit sales during 2025 are projected to be about 31,000, an increase of 30.8% when compared with 2024.
This funding includes $1 billion in grants for clean Class 6 and 7 heavy-duty vehicles, up to $40,000 in tax credits for zero-emission commercial vehicles, up to $100,000 in tax credits for heavy-duty charging infrastructure, and $2 billion for grants to support electric and fuel cell manufacturing.
This funding included or includes, as applicable, up to $40,000 in tax credits for zero-emission commercial vehicles, which expired in September 2025; up to $100,000 in tax credits for heavy-duty charging infrastructure; and $2 billion for grants to support electric and fuel cell manufacturing.
To date, the Company has received over 220 orders for school buses with many of the award recipients yet to spend their funding. In September 2024, the EPA announced it will provide an additional $965 million for its fourth round of funding for the CSBP, with award recipients for this funding to be announced in May 2025.
To date, the Company has received over 490 orders for both propane and electric powered school buses. In September 2024, the EPA announced it would provide an additional $965 million for its fourth round of funding for the CSBP and accepted applications for this round of funding, with award recipients expected to be announced in May 2025.
The periodic reports we file with, or furnish to, the SEC pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available free of charge on our website: https://investors.blue-bird.com .
The periodic reports we file with, or furnish to, the SEC pursuant to Section 13(a) or 15(d) of the Exchange Act are available free of charge on our website: https://investors.blue-bird.com . This includes Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as any amendments to those reports.
The grant represents approximately 50 percent of the total approximate $160 million investment required to complete the conversion project. The award selection is subject to final contract and funding negotiations between the DOE and Blue Bird, which are expected to conclude at the end of calendar year 2024 or the beginning of calendar year 2025.
The MESC grant originally represented approximately 50 percent of the total approximate $160 million investment required to complete the conversion project. The award selection and funding negotiations between the DOE and Blue Bird were finalized at the end of calendar year 2024.
Product Initiatives — We continue to update and improve our products. • During fiscal 2024, we announced, and began taking actions to implement, the most comprehensive safety upgrades to our school buses in the Company’s history.
Product Initiatives — We continue to update and improve our products. • During fiscal 2024, we announced, and began taking actions to implement, the most comprehensive safety upgrades to our school buses in the Company’s history. Blue Bird is equipping new school buses with a series of industry-first safety features, enhancing the safety of school children and school bus drivers.
As an additional industry first, Blue Bird will safeguard school bus drivers with the introduction of 4Front, a steering wheel deployed air bag. Blue Bird collaborated with IMMI, an employee-owned, leading global supplier of advanced safety systems and restraints based in Indiana, to develop these industry-leading safety enhancements in student transportation.
Blue Bird collaborated with IMMI, an employee-owned, leading global supplier of advanced safety systems and restraints based in Indiana, to develop these industry-leading safety enhancements in student transportation. Blue Bird will also begin implementing a series of improvements to increase the performance of the school bus and its safety on the road.
We post each of these documents on our website as soon as reasonably practicable after it is electronically filed with, or furnished to, the SEC. Our reports filed with, or furnished to, the SEC may also be found at the SEC’s website at https://www.sec.gov .
Our reports filed with, or furnished to, the SEC may also be found at the SEC’s website at https://www.sec.gov .
In addition to the information contained in this Annual Report on Form 10-K for the fiscal year ended September 28, 2024 (“Report”), information about our Company can be found at https://investors.blue-bird.com , including extensive information about our management team, our products and our corporate governance.
Any amendments to our Code of Ethics or waivers granted to our directors and executive officers will be posted on our corporate website. In addition to the information contained in this Report, information about our Company can be found at https://investors.blue-bird.com , including extensive information about our management team, our products and our corporate governance.
Accordingly, management believes that the overall decrease in the annual industry sales experienced during 2024 primarily resulted from an event that is expected to be isolated in nature and is not indicative of decreased demand, or other issues, within the overall school bus industry. 6 Source: Historical registration data are based on R.L. Polk vehicle registration data.
Accordingly, management believes that the year-over-year fluctuations in annual industry sales involving 2024 are primarily the result of an event that was isolated in nature and is not indicative of demand, or other issues, within the overall school bus industry.
As discussed previously, in July 2024 the Company was selected to receive an approximate $80 million grant from the DOE to expand the Company’s electric vehicle manufacturing capabilities and related workforce development efforts by converting a former manufacturing site for diesel powered motorhomes into an approximately 600,000 square foot, state-of-the-art electric and low-emissions vehicle manufacturing facility.
In July 2024, the Company was selected to receive an approximate $80 million MESC grant from the DOE to convert a former manufacturing site for diesel powered motorhomes into a new manufacturing facility to build buses of all powertrains including electric and low-emissions vehicles.
Department of Energy ("DOE") selected Blue Bird to receive an approximate $80 million grant to convert a former manufacturing site for diesel powered motorhomes into an approximately 600,000 square foot, electric and low-emissions vehicle manufacturing facility. The grant represents 50 percent of the total approximate $160 million investment required to complete the conversion project.
Department of Energy ("DOE") Office of Manufacturing and Energy Supply Chains (“MESC”) selected Blue Bird to receive an approximate $80 million grant to convert a former manufacturing site for diesel powered motorhomes into a new manufacturing facility to build buses of all powertrains including electric and low-emissions vehicles (the “MESC grant”).
This includes Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as any amendments to those reports. Section 16 filings made with the SEC by any of our executive officers or directors with respect to our Common Stock also are made available free of charge through our website.
Section 16 filings made with the SEC by any of our executive officers or directors with respect to our Common Stock also are made available free of charge through our website. We post each of these documents on our website as soon as reasonably practicable after it is electronically filed with, or furnished to, the SEC.
Our longevity and reputation in the school bus industry have made us an iconic American brand.
Our Competitive Strengths We believe that our competitive strengths are derived from the following factors: Reputation for safety, product quality/reliability/durability, and drivability . Our longevity and reputation in the school bus industry have made us an iconic American brand.
Finally, the Clean Heavy Duty Vehicle Program funded through the Infrastructure Investment and Jobs ACT ("IIJA") announced over $650 million in funding for electric school buses in April 2024. Recipients for this funding will be announced in January 2025. In addition to federal funding, many states have also announced significant levels of funding for electric school buses.
Accordingly, it is currently not known whether or not the EPA will move forward awarding funds from this round of the CSBP. Finally, in January 2025, the Clean Heavy Duty Vehicle Program funded through the Infrastructure Investment and Jobs Act ("IIJA") announced over $380 million in funding to 35 award recipients for over 1,275 electric school buses.
Employee training and development programs are extensive and comprehensive, including professional and technical skills training, compliance training, leadership development and management training. We view the diversity of our employees as a strength to better serve our customers and communities.
We continue to make significant investments in talent development and recognize that the growth and development of our employees is essential for our continued success. Employee training and development programs are extensive and comprehensive, including professional and technical skills training, compliance training, leadership development and management training.
To that end, we have taken various actions to enhance diversity, including partnering with organizations that can support our efforts to identify and recruit talented and diverse candidates. We aim to cultivate an inclusive culture that enables employees to feel connected to Blue Bird's three foundational objectives (Care, Delight, Deliver) while being valued for their contributions.
We aim to cultivate an inclusive culture that enables employees to feel connected to Blue Bird's three foundational objectives (Care, Delight, Deliver) while being valued for their contributions. The Company’s benefit packages support employee physical, emotional and financial well-being. Employee satisfaction and engagement are measured through periodic surveys.
We seek people who are proactive and dedicated, demonstrate an ownership mindset and share our commitment to the pursuit of operational excellence. We continue to make significant investments in talent development and recognize that the growth and development of our employees is essential for our continued success.
This commitment applies to everyone involved in Company operations and prohibits unlawful discrimination in all forms. We offer employees resources to continuously improve their skills and performance with the goal of further cultivating the opportunities for all employees. We seek people who are proactive and dedicated, demonstrate an ownership mindset and share our commitment to the pursuit of operational excellence.
Starting in the first quarter of the fiscal year ending September 27, 2025 ("fiscal 2025"), Blue Bird will begin equipping new school buses with a series of industry-first safety features, enhancing the safety of school children and school bus drivers.
As an additional industry first, Blue Bird is safeguarding school bus drivers with the introduction of 4Front, a steering wheel deployed air bag, starting in the first quarter of our fiscal year ending October 3, 2026 ("fiscal 2026").
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Any amendments to our Code of Ethics or waivers granted to our directors and executive officers will be posted on our corporate website.
Added
The MESC grant originally represented approximately 50 percent of the total approximate $160 million investment required to complete the conversion project. Negotiations concluded and the MESC grant was finalized at the end of calendar year 2024.
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Blue Bird will also begin implementing a series of improvements to increase the performance of the school bus and its safety on the road.
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Upon inauguration of the new presidential administration at the beginning of calendar year 2025, the DOE initiated a review of all previously awarded grants under the MESC program for consistency with the goals and objectives of the new administration, with such review still ongoing.
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The award selection is subject to final contract and funding negotiations between the DOE and Blue Bird, which are expected to conclude at the end of calendar year 2024 or the beginning of calendar year 2025. 5.
Added
However, Blue Bird has updated its plans to increase its own investment in the project to allow for an expanded facility that will further its capabilities to continue producing buses containing all powertrains offered, including, but not limited to, electric and low-emissions vehicles, as demanded by the market, and to continue and expand domestic manufacturing operations in Fort Valley, Georgia. 5.
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For the first half of the annual period from October 2023 through September 2024, monthly units sales were comparable to those reported in the same period in the previous year but decreased significantly during the second half of the period.
Added
In September 2025, Micro Bird opened a facility in Plattsburgh, New York, and began producing small and mid-size commercial 5 buses. Similar to Type A school buses, the commercial buses are produced on a traditional chassis provided by either Ford or GM or on an electric chassis produced by a Micro Bird subsidiary.
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The DERA funding program provides approximately $100 million annually to fund projects that upgrade, retrofit, or replace diesel engines and equipment with cleaner technologies including gasoline, propane, and electric school buses.
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However, during 2025, the competitor resolved its issues and returned to a more normal manufacturing level. When compared to 2023, industry unit sales for 2025 increased 6.9%.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe can provide no assurance that we would be able to take any of these actions, that these actions would permit us to meet our scheduled debt service obligations or that these actions would be permitted under the terms of our existing or future debt agreements, which may impose significant operating and financial restrictions on us and could adversely affect our ability to finance our future operations or capital needs; obtain standby letters of credit, bank guarantees or performance bonds required to bid on or secure certain customer contracts; make strategic acquisitions or investments or enter into alliances; withstand a future downturn in our business or the economy in general; engage in business activities, including future opportunities for growth, that may be in our interest; and plan for or react to market conditions or otherwise execute our business strategies. 20 If we cannot make scheduled payments on our debt, or if we breach any of the covenants in our debt agreements, we will be in default and, as a result, our lenders could declare all outstanding principal and interest to be due and payable, could terminate their commitments to lend us money and foreclose against the assets securing our borrowings, and we could be forced into bankruptcy or liquidation.
Biggest changeWe can provide no assurance that we would be able to take any of these actions, that these actions would permit us to meet our scheduled debt service obligations or that these actions would be permitted under the terms of our existing or future debt agreements, which may impose significant operating and financial restrictions on us and could adversely affect our ability to finance our future operations or capital needs; obtain standby letters of credit, bank guarantees or performance bonds required to bid on or secure certain customer contracts; make strategic acquisitions or investments or enter into alliances; withstand a future downturn in our business or the economy in general; engage in business activities, including future opportunities for growth, that may be in our interest; and plan for or react to market conditions or otherwise execute our business strategies.
Future 14 delays or interruptions in the supply chain expose us to the following risks which would likely significantly increase our costs and/or impact our ability to meet customer demand: • we or our third-party suppliers may lose access to critical services and components, resulting in an interruption in the manufacture, assembly, and delivery or shipment of our products; • we or our third-party suppliers may not be able to respond to unanticipated changes in customer orders; • we or our suppliers may have excess or inadequate inventory of materials and components; • we or our third-party suppliers may be subject to price fluctuations, including for inbound freight costs that are incurred to transport goods and supplies to production facilities, and a lack of long-term supply arrangements for key components; • we may experience delays in delivery by our third-party suppliers due to changes in demand from us or their other customers; • fluctuations in demand for products that our third-party suppliers manufacture for others may affect their ability or willingness to deliver components to us in a timely manner; • we may not be able to find new or alternative components or reconfigure our products and manufacturing processes in a timely manner, or at all, if the necessary components become unavailable; and • our third-party suppliers may encounter financial hardships unrelated to our demand, which could inhibit their ability to fulfill our orders and meet our requirements.
Future delays or interruptions in the supply chain expose us to the following risks which would likely significantly increase our costs and/or impact our ability to meet customer demand: • we or our third-party suppliers may lose access to critical services and components, resulting in an interruption in the manufacture, assembly, and delivery or shipment of our products; • we or our third-party suppliers may not be able to respond to unanticipated changes in customer orders; • we or our suppliers may have excess or inadequate inventory of materials and components; • we or our third-party suppliers may be subject to price fluctuations, including for inbound freight costs that are incurred to transport goods and supplies to production facilities, and a lack of long-term supply arrangements for key components; 14 • we may experience delays in delivery by our third-party suppliers due to changes in demand from us or their other customers; • fluctuations in demand for products that our third-party suppliers manufacture for others may affect their ability or willingness to deliver components to us in a timely manner; • we may not be able to find new or alternative components or reconfigure our products and manufacturing processes in a timely manner, or at all, if the necessary components become unavailable; and • our third-party suppliers may encounter financial hardships unrelated to our demand, which could inhibit their ability to fulfill our orders and meet our requirements.
If operations at our manufacturing or distribution facilities were to be disrupted for a significant length of time as a result of significant equipment failures, critical component shortages, natural disasters, power outages, fires, explosions, terrorism, adverse weather conditions, labor disputes, cybersecurity attacks or other reasons, we may be unable to fulfill dealer or customer orders and otherwise meet demand for our products, which would have an adverse effect on our business, financial condition, results of operations and cash flows.
If operations at our manufacturing or distribution facilities were to be disrupted for a significant length of time as a result of 17 significant equipment failures, critical component shortages, natural disasters, power outages, fires, explosions, terrorism, adverse weather conditions, labor disputes, cybersecurity attacks or other reasons, we may be unable to fulfill dealer or customer orders and otherwise meet demand for our products, which would have an adverse effect on our business, financial condition, results of operations and cash flows.
On May 28, 2015 and March 12, 2020, we registered 3,700,000 and 1,500,000 common stock shares, respectively, representing the shares of common stock issuable under the Blue Bird Corporation 2015 Omnibus Equity Incentive Plan (the “Incentive Plan”) and, pursuant to Rule 416(c) under the Securities Act of 1933, as amended, an indeterminable number of additional shares of common stock issuable under the Incentive Plan, as such amount may be adjusted as a result of stock splits, stock dividends, recapitalizations, anti-dilution provisions and similar transactions.
On May 28, 2015 and March 12, 2020, we registered 3,700,000 and 1,500,000 common stock shares, respectively, representing the shares of common stock issuable under the Blue Bird Corporation Amended and Restated 2015 Omnibus Equity Incentive Plan (the “Incentive Plan”) and, pursuant to Rule 416(c) under the Securities Act of 1933, as amended ("Securities Act"), an indeterminable number of additional shares of common stock issuable under the Incentive Plan, as such amount may be adjusted as a result of stock splits, stock dividends, recapitalizations, anti-dilution provisions and similar transactions.
We may also be required to remedy or retrofit buses in the event that an order is not built to a customer’s specifications or where a design error has been made. Significant retrofit and remediation costs or product recalls could have a material adverse effect on our financial condition, results of operations and cash flows.
We may also be required to remedy or retrofit 18 buses in the event that an order is not built to a customer’s specifications or where a design error has been made. Significant retrofit and remediation costs or product recalls could have a material adverse effect on our financial condition, results of operations and cash flows.
In addition, while we have not faced 21 intellectual property infringement claims from others in recent years, in the event successful infringement claims are brought against us, particularly claims (under patents or otherwise) against our product design or manufacturing processes, such claims could have a material adverse effect on our business, financial condition or results of operation.
In addition, while we have not faced intellectual property infringement claims from others in recent years, in the event successful infringement claims are brought against us, particularly claims (under patents or otherwise) against our product design or manufacturing processes, such claims could have a material adverse effect on our business, financial condition or results of operation.
Both countries have large quantities of minerals and other natural resources that impact commodity costs, such as diesel fuel, steel, rubber and resin, among others, and the conflict has further restricted access to inventory that is at least partially dependent upon such commodities, primarily for the Company’s 15 suppliers.
Both countries have large quantities of minerals and other natural resources that impact commodity costs, such as diesel fuel, steel, rubber and resin, among others, and the conflict has further restricted access to inventory that is at least partially dependent upon such commodities, primarily for the Company’s suppliers.
We may be unable to prevent third parties from using our intellectual property rights, including trade secrets and know-how, without our authorization or from independently developing intellectual property that is the same as or similar to our intellectual property, particularly in those countries where the laws do not protect our intellectual property rights as fully as in the U.S.
We may be unable to prevent third parties from using our intellectual property rights, including trade secrets and know-how, without our authorization or from independently developing intellectual property that is the same as or similar to our intellectual property, 21 particularly in those countries where the laws do not protect our intellectual property rights as fully as in the U.S.
To the extent the increase in school bus demand is attributable to pent-up demand rather than overall economic growth, future school bus sales may lag behind improvements in general economic conditions or property tax levels. During downturns, we may find it necessary to reduce line rates and employee levels due to lower overall demand.
To the extent the increase in school bus demand is attributable to pent-up demand rather than overall economic growth, future school bus sales may lag behind improvements in general economic conditions or property tax levels. During downturns, we may find it necessary to reduce 16 line rates and employee levels due to lower overall demand.
Increased environmental, safety, emissions, fuel economy or other regulations may result in additional costs and lag time to introduce new products to market. 17 Safety or durability incidents associated with a school bus malfunction may result in loss of school bus sales that could have material adverse effects on our business.
Increased environmental, safety, emissions, fuel economy or other regulations may result in additional costs and lag time to introduce new products to market. Safety or durability incidents associated with a school bus malfunction may result in loss of school bus sales that could have material adverse effects on our business.
We can also provide no assurance that our insurance policies will cover every cybersecurity incident and/or will be adequate to cover all the costs related to significant security attacks or disruptions resulting from such attacks. Finally, such insurance policies may not continue to be available in amounts and/or on terms acceptable to us.
We can also provide no assurance that our insurance policies will cover every cybersecurity incident and/or will be adequate to cover all the costs related to significant security attacks or disruptions resulting from such attacks. Finally, such insurance policies may not continue to be available in amounts and/or on terms acceptable to us, or at all.
Because Huntington serves as an additional source of leasing and financing options for dealers and customers, an impairment of Huntington’s ability to provide such financial services could negatively affect our efforts to expand our market penetration among customers that rely on these financial services to acquire new school buses and dealers that seek financing.
Because Huntington serves as an additional source of leasing and financing options for dealers and certain customers, an impairment of Huntington’s ability to provide such financial services could negatively affect our efforts to expand our market penetration among customers that rely on these financial services to acquire new school buses and dealers that seek financing.
We collect, store and process sensitive data, including intellectual property, material non-public financial information, proprietary 23 business information, the proprietary business information of our dealers and suppliers, as well as personally identifiable information of our employees, in data centers and in our information technology systems.
We collect, store and process sensitive data, including intellectual property, material non-public financial information, proprietary business information, the proprietary business information of our dealers and suppliers, as well as personally identifiable information of our employees, in data centers and in our information technology systems.
In such a case, we may not be able to recover our losses from the supplier. 18 We may incur material losses and costs as a result of product liability claims and recalls.
In such a case, we may not be able to recover our losses from the supplier. We may incur material losses and costs as a result of product liability claims and recalls.
Events and conditions that could result in impairment include a prolonged period of global economic weakness, a further decline in economic conditions or a slow, weak economic recovery, sustained declines in the price of our common stock, adverse changes in the regulatory environment, adverse changes in the market share of our products, adverse changes in interest rates or other factors leading to reductions in the long-term sales or profitability that we expect.
Events and conditions that could result in impairment include a prolonged period of global economic weakness; a significant decline in economic conditions or a slow, weak economic recovery; sustained declines in the price of our common stock; adverse changes in the regulatory environment; adverse changes in the market share of our products; adverse changes in interest rates or other factors leading to reductions in the long-term sales or profitability that we expect.
As a result, foreign currency fluctuations and the associated remeasurements and translations could have a material adverse effect on our results of operations and financial condition. The manufacture of our Type A buses is conducted by the Micro Bird joint venture that we do not control and cannot operate solely for our benefit.
As a result, foreign currency fluctuations and the associated remeasurements and translations could have a material adverse effect on our results of operations and financial condition. The manufacture of Type A school buses and commercial buses is conducted by the Micro Bird joint venture that we do not control and cannot operate solely for our benefit.
Although we neither assume any balance sheet risk nor receive any direct economic benefit from Huntington, we could be materially adversely affected if Huntington was unable to provide this financing and our dealers were unable to obtain alternate financing, at least until a replacement for Huntington was identified.
Although we neither assume any balance sheet risk nor receive any direct economic benefit from Huntington, we could be materially adversely affected if Huntington was unable to provide this financing and our dealers and other customers were unable to obtain alternate financing, at least until a replacement for Huntington was identified.
All investigations of suspect areas have been completed. Implementation of a corrective action plan has commenced, which will consist of re-surfacing the landfill cap, re-grading a portion of 19 the lot in close proximity to the landfill, ongoing monitoring, and ground water use restrictions for the old landfill.
Substantially all investigations of suspect areas have been completed. Implementation of a corrective action plan has commenced, which will consist of re-surfacing the landfill cap, re-grading a portion of the lot in close proximity to the landfill, ongoing monitoring, and ground water use restrictions for the old landfill.
Beginning in fiscal 2022 and continuing through fiscal 2024, the ongoing pressure on the global supply chain was further exacerbated as a result of Russia’s invasion of Ukraine towards the end of February 2022.
Beginning in fiscal 2022 and continuing through fiscal 2025, the ongoing pressure on the global supply chain was further exacerbated as a result of Russia’s invasion of Ukraine towards the end of February 2022.
Huntington faces a number of business, economic and financial risks that could impair its access to capital and negatively affect its business and operations and its ability to provide financing and leasing to our dealers and customers.
Huntington faces a number of business, economic and financial risks that could impair its access to capital and negatively affect its business and operations and its ability to provide financing and leasing to our dealers and certain other customers.
We rely heavily on trade secrets to gain a competitive advantage in the market and the unenforceability of our nondisclosure agreements may adversely affect our operations. Historically, we have not relied upon patents to protect our design or manufacturing processes or products.
We rely heavily on trade secrets to gain a competitive advantage in the market and in the event of the unenforceability of our nondisclosure agreements, our operations may adversely affected. Historically, we have not relied upon patents to protect our design or manufacturing processes or products.
Our business is cyclical, which has had, and could have future, adverse effects on our sales and results of operations and lead to significant shifts in our results of operations from quarter to quarter that make it difficult to project long-term performance.
Our business can be cyclical, which has had, and could have future, adverse effects on our sales and results of operations and lead to significant shifts in our results of operations from quarter to quarter that make it difficult to project long-term performance.
Our current or future indebtedness could impair our financial condition and reduce the funds available to us for growth or other purposes. Our debt agreements impose certain operating and financial restrictions, with which failure to comply could result in an event of default that could adversely affect our business. We have substantial indebtedness.
Our current or future indebtedness could impair our financial condition and reduce the funds available to us for growth or other purposes. Our debt agreements impose certain operating and financial restrictions, with which failure to comply could result in an event of default that could adversely affect our business. We have a material amount of indebtedness.
The manufacture of Type A buses is carried out by a 50/50 Canadian joint venture, Micro Bird, which we do not control or consolidate.
The manufacture of Type A school buses and commercial buses is carried out by a 50/50 Canadian joint venture, Micro Bird, which we do not control or consolidate.
We depend on School Bus Holdings and its subsidiaries for distributions, loans and other payments to generate the funds necessary to meet our financial obligations, including our expenses as a publicly traded company, and to pay any dividends with respect to our common stock, if any.
We depend on Blue Bird Body Company and its subsidiaries for distributions, loans and other payments to generate the funds necessary to meet our financial obligations, including our expenses as a publicly traded company, and to pay any dividends with respect to our common stock, if any.
Consequently, stockholders' ability to achieve a return on their investment will depend on appreciation in the price of our common stock. We have no direct operations and no significant assets other than the ownership of 100% of the capital stock of School Bus Holdings.
Consequently, stockholders' ability to achieve a return on their investment will depend on appreciation in the price of our common stock. We have no direct operations and no significant assets other than the ownership of 100% of the capital stock of Blue Bird Body Company.
Other Risk Factors Relating to an Investment in Our Common Stock Our only significant asset is ownership of 100% of the capital stock of School Bus Holdings and we do not currently intend to pay cash dividends on our common stock.
Other Risk Factors Relating to an Investment in Our Common Stock Our only significant asset is ownership of 100% of the capital stock of Blue Bird Body Company and we do not currently intend to pay cash dividends on our common stock.
While we maintain business continuity and disaster recovery plans and conduct training and tests to respond to these types of events, we can provide no assurance that these measures would be sufficient to prevent or mitigate the impact of a prolonged information technology failure or that we would not experience material losses if such an event was to occur.
While we maintain business continuity and disaster recovery plans and conduct training and tests to respond to these types of events, we can provide no assurance that these measures would be sufficient to prevent or mitigate the impact of a prolonged information technology failure or that we would not experience material losses if such an event was to occur. 23 A cybersecurity incident could compromise the confidentiality, integrity, and/or availability of our proprietary electronic information.
Legal and contractual restrictions in agreements governing our current indebtedness, as well as our financial condition and operating requirements, may limit our ability to obtain cash from School Bus Holdings and its subsidiaries.
Legal and contractual restrictions in agreements governing our current indebtedness, as well as our financial condition and operating requirements, may limit our ability to obtain cash from Blue Bird Body Company and its subsidiaries.
Our profitability requires us to maintain certain minimum school bus sales volumes and margins. As is typical for a vehicle manufacturer, we have significant fixed costs and, therefore, changes in our school bus sales volume can have a disproportionately large effect on profitability.
As is typical for a vehicle manufacturer, we have significant fixed costs and, therefore, changes in our school bus sales volume can have a disproportionately large effect on profitability.
Our competitors may develop or gain access to products that are superior to our products, develop methods of more efficiently and effectively providing products and services, or adapt more quickly than we do to new technologies or evolving customer requirements. IC Bus and Thomas Built Bus both sell electric powered school buses.
Our competitors may develop or gain access to products that are superior to our products, develop methods of more efficiently and effectively providing products and services, or adapt more quickly than we do to new technologies or evolving customer requirements.
While some of the elements of cost reduction are within our control, others, such as commodity costs, regulatory costs and labor costs, depend more on external factors, and there can be no assurance that such external factors will not materially adversely affect our ability to reduce our costs.
While some of the elements of cost reduction are within our control, others, such as commodity costs, regulatory costs and labor costs, depend more on external factors, and there can be no assurance that such external factors will not materially adversely affect our ability to reduce our costs. 19 Our operating results may vary widely from period to period due to the sales cycle, seasonal fluctuations and other factors.
We may be unable to obtain critical components from suppliers, which could disrupt or delay our ability to deliver products to customers. We rely on specialist suppliers for critical components (including engines, transmissions and axles) and replacement of any of these components with like parts from another supplier normally requires engineering and testing resources, which entail costs and take time.
We rely on specialist suppliers for critical components (including engines, transmissions and axles) and replacement of any of these components with like parts from another supplier normally requires engineering and testing resources, which entail costs and take time.
Significant deterioration in the economic environment, housing prices, property tax levels or municipal budgets could result in fewer new orders for school buses or could cause customers to seek to postpone or reduce orders, which could result in lower revenues, profitability and cash flows.
Significant deterioration in the economic environment, housing prices, property tax levels or municipal budgets could result in fewer new orders for school buses or could cause customers to seek to postpone or reduce orders, which could result in lower revenues, profitability and cash flows. 15 We may be unable to obtain critical components from suppliers, which could disrupt or delay our ability to deliver products to customers.
Our operating results may vary widely from period to period due to the sales cycle, seasonal fluctuations and other factors. Our orders with our dealers and customers generally require time-consuming customization and specification. We incur significant operating expenses when we are building a bus prior to sale or designing and testing a new bus.
Our orders with our dealers and customers generally require time-consuming customization and specification. We incur significant operating expenses when we are building a bus prior to sale or designing and testing a new bus.
We can provide no assurance that our ability to sell our products at reasonable margins will not be impaired by the imposition of tariffs or other changes in trade policy which may make it more difficult or more expensive to purchase our products.
We can provide no assurance that our ability to sell our products at reasonable margins, or at all, would not be impaired by the imposition of changes in trade policies and tariffs that may make it more difficult or expensive for us to purchase inventory, which could result in reduced sales, profitability and cash flows.
During economic downturns, this tends to result in our utilizing a substantial portion of our cash reserves. Our ability to sell our products may be negatively affected by trade policies and tariffs. We import some of our components from China and other foreign countries.
During economic downturns, this tends to result in our utilizing a substantial portion of our cash reserves. Our costs to produce, and our ability to sell, our products may be negatively impacted by changes in trade policies and tariffs.
In addition, we and certain of our subsidiaries may incur significant additional indebtedness, including additional secured and/or unsecured indebtedness. Although the terms of our debt agreements contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions, and additional indebtedness incurred in compliance with these restrictions could be significant.
Although the terms of our debt agreements contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions, and additional indebtedness incurred in compliance with these restrictions could be significant. Incurring additional indebtedness could increase the risks associated with our current indebtedness, including our ability to service our indebtedness.
At September 28, 2024, there were 594,232 common stock shares remaining to be issued under the Incentive Plan.
At September 27, 2025, there were 293,304 common stock shares remaining to be issued under the Incentive Plan.
Additionally, on November 16, 2021, we filed a Registration Statement on Form S-3 that allows the Company to sell up to $200.0 million in the aggregate of any combination of several different types of securities, including shares of common stock, from time to time in one or more offerings.
On December 23, 2024, we filed an automatic shelf Registration Statement on Form S-3 that allows the Company to sell an undisclosed amount, in any combination, of several different types of securities, including shares of common stock, from time to time in one or more offerings.
Incurring additional indebtedness could increase the risks associated with our substantial indebtedness, including our ability to service our indebtedness. Our profitability depends on achieving certain minimum school bus sales volumes and margins. If school bus sales deteriorate, our results of operations, financial condition, and cash flows will suffer.
Our profitability depends on achieving certain minimum school bus sales volumes and margins. If school bus sales deteriorate, our results of operations, financial condition, and cash flows will suffer. Our profitability requires us to maintain certain minimum school bus sales volumes and margins.
A cybersecurity incident could compromise the confidentiality, integrity, and/or availability of our proprietary electronic information. We are highly dependent on information technology systems and networks to conduct our business and manage critical operations.
We are highly dependent on information technology systems and networks to conduct our business and manage critical operations.
In addition, our competitors could be, and have been in the past, vertically 16 integrated by designing and manufacturing their own components (including engines) to reduce their costs.
Our competitors may achieve cost savings or be able to withstand a substantial downturn in the market because their businesses are consolidated with other vehicle lines. In addition, our competitors could be, and have been in the past, vertically integrated by designing and manufacturing their own components (including engines) to reduce their costs.
If Huntington Distribution Finance, Inc. cannot provide financial services to our dealers and customers to acquire our products, our sales and results of operations could deteriorate. Our dealers and customers benefit from their relationships with Huntington, which provides (i) floorplan financing for certain of our network dealers and (ii) a modest amount of vehicle lease financing to school districts.
Our dealers and customers benefit from their relationships with Huntington, which provides (i) floorplan financing for certain of our network dealers and (ii) vehicle lease and other financing options to certain school districts and large fleet customers.
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This brings both competitors into direct competition with our electric powered product offerings. Our competitors may achieve cost savings or be able to withstand a substantial downturn in the market because their businesses are consolidated with other vehicle lines.
Added
IC Bus and Thomas Built Bus both sell electric powered school buses and offer, or have announced intentions to offer, gasoline powered school buses. This brings both competitors into direct competition with several of our alternative powered product offerings.
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Our purchases may be subject to the effects of the U.S. trade policy, including the imposition of tariffs and anti-dumping/countervailing duties on these components.
Added
Recently enacted and/or proposed trade policies and tariffs have increased and/or could increase the cost of components we and/or our suppliers purchase from Canada, China and Mexico, which have increased and/or could increase our cost to produce buses and purchase parts for resale. These enacted and/or proposed trade policies and tariffs could expand to other foreign countries in future periods.
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Our defined benefit pension plan may become underfunded in future periods and pension funding requirements could increase significantly due to a reduction in funded status as a result of a variety of factors, including weak performance of financial markets, decreasing interest rates and investments that do not achieve adequate returns.
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We can provide no assurance that we will be able to successfully pass along part or all of our increased costs to our customers, particularly for those customers for which we have executed a contract containing a fixed bus price.
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Our defined benefit pension plan currently holds a significant amount of equity and fixed income securities.
Added
Additionally, our ability to increase the sales price we charge for our products could impact customer purchasing decisions in future periods, resulting in them buying less, or none, of our products.
Removed
Our future funding requirement for our frozen defined benefit pension plan (“Pension Plan”) qualified with the Internal Revenue Service depends upon the future performance of assets placed in trusts for this plan, the level of interest rates used to determine funding levels, the level of benefits provided for by the Pension Plan and any changes in government laws and regulations.
Added
We have recently initiated actions to terminate our defined benefit pension plan during fiscal 2026 and the amount of pension funding required in connection with the termination could be significant due to, among other factors, decreasing interest rates, investments that do not achieve adequate returns and/or the degree of our success in our negotiations with the insurance company from which we will purchase group annuity contracts to pay pension obligations due to participants in future years.
Removed
Future funding requirements generally increase if the discount rate decreases or if actual asset returns are lower than expected asset returns, as other factors are held constant. If future funding requirements increase, we would be required to contribute more funds, which would negatively impact our cash flows.
Added
During fiscal 2025, we began executing a plan that will result in the termination of our frozen defined benefit pension plan (“Pension Plan”) qualified with the Internal Revenue Service during fiscal 2026.
Added
Upon making such decision, we transitioned all Pension Plan assets, which were previously comprised primarily of equity and longer-termed fixed income securities, to a money market fund comprised of high quality, highly liquid investments, primarily issued by the U.S. government, having maturities of less than one year to ensure the preservation of principal.
Added
While such assets are not as prone to the risk of significant fluctuations in fair value, the return that they earn is more exposed to changes in shorter-term interest rates.
Added
A decrease in such interest rates during fiscal 2026 would result in both a reduction in the value of assets and an increase in the amount of pension obligations due to participants during the plan termination process.
Added
Additionally, we will have to negotiate with insurance companies on the cost of the group annuity contracts that we plan to purchase to pay the pension obligations due to participants in future years.
Added
The funding required in fiscal 2026 in connection with the plan termination is dependent on the return earned by assets placed in trusts for this plan, the level of interest rates used to determine pension obligations due to participants in future periods and the degree of our success in our negotiations with the insurance company from which we purchase group annuity contacts.
Added
An adverse impact from any or all of the above discussed factors could result in a significant amount of pension funding during the termination process in fiscal 2026, which would negatively impact our cash flows.
Added
Additionally, the plan termination will have a material impact on both our profitability and financial position in fiscal 2026 as we will be required to recognize in our consolidated statements of operations the significant amount of losses deferred in the equity account entitled accumulated other comprehensive loss in connection with the transaction.
Added
If we cannot make scheduled payments on our debt, or if we breach any of the covenants in our debt agreements, we will be in default and, as a result, our lenders could declare all outstanding principal and interest to be due and payable, could terminate their commitments to lend us money and foreclose against the assets securing our borrowings, and we could be forced into bankruptcy or liquidation. 20 In addition, we and certain of our subsidiaries may incur significant additional indebtedness, including additional secured and/or unsecured indebtedness.
Added
Changes in laws, regulations or governmental policies and programs involving grants, subsidies and/or other incentives may negatively impact our sale of alternative powered school buses.
Added
Our production plans and financial projections incorporate federal and state programs supporting adoption of clean fuel technologies into existing school bus fleets by offering grants, subsidies and/or other incentives to partially, or fully, offset the higher price of alternative powered school buses.
Added
Changes in government programs and support for these products could impact customer purchasing decisions in future periods, resulting in them buying less, or none, of our alternative powered products.
Added
While we manage our product development and production operations to support all power options we offer to our customers, which include diesel, gasoline, propane and all-electric powered school buses, our materials ordering and sales projections incorporate assumptions that the mix of school buses we will produce and sell in future periods will be impacted by customers taking advantage of assistance programs offered by federal and state governments.
Added
Changes in such programs could impact customer ordering practices, which could result in sales and/or gross profit amounts varying, potentially significantly, from our original estimates of such amounts. If Huntington Distribution Finance, Inc. cannot provide financial services to our dealers and customers to acquire our products, our sales and results of operations could deteriorate.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe vCISO works with and provides strategic guidance to the Vice President of Information Technology, including preparing and/or presenting key information to the Company's Audit Committee or Board or Directors, as necessary.
Biggest changeThe vCISO works with and provides strategic guidance to the Vice President of Information Technology, including preparing and/or presenting key information to the Company's Audit Committee or Board of Directors, as necessary.

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed3 unchanged
Biggest changeOur Micro Bird joint venture leases its facility (0.2 million square feet) in Drummondville, Quebec, Canada.
Biggest changeOur Micro Bird joint venture leases its facilities in Drummondville, Quebec, Canada (approximately 0.2 million square feet) and Plattsburgh, New York (approximately 0.2 million square feet).

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

10 edited+5 added−1 removed7 unchanged
Biggest changePerformance Graph The following performance graph and related information is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C under the Securities Exchange Act of 1934, as amended, or to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, as amended, except to the extent the Company specifically incorporates it by reference into such a filing: the SEC requires the Company to include a line graph presentation comparing cumulative five year common stock returns with a broad-based stock index and either a nationally recognized industry index or an index of peer companies selected by the Company.
Biggest changePerformance Graph The following performance graph and related information is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C under the Exchange Act, or to the liabilities of Section 18 of the Exchange Act, and will not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent the Company specifically incorporates it by reference into such a filing.
Management of the Company believes that there are in excess of 34,000 beneficial holders of our common stock. Dividends We have not paid any dividends on our common stock to date.
Management of the Company believes that there are in excess of 26,000 beneficial holders of our common stock. Dividends We have not paid any dividends on our common stock to date.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is currently quoted on the NASDAQ Global Market under the symbol “BLBD.” At November 20, 2024, there were 66 holders of record of the Company’s common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is currently quoted on the NASDAQ Global Market under the symbol “BLBD.” At November 19, 2025, there were 65 holders of record of the Company’s common stock.
Securities Authorized for Issuance Under Equity Compensation Plans The following table provides information for all equity compensation plans at September 28, 2024, under which the equity securities of the Company were authorized for issuance: Plan Category (1) (a) Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants, and Rights (b) Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (c) Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities reflected in column (a)) (2) Equity compensation plans approved by security holders 278,678 $ 17.58 594,232 (1) There are no equity compensation plans not approved by stockholders.
Securities Authorized for Issuance Under Equity Compensation Plans The following table provides information for all equity compensation plans at September 27, 2025, under which the equity securities of the Company were authorized for issuance: Plan Category (1) (a) Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants, and Rights (b) Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (c) Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities reflected in column (a)) (2) Equity compensation plans approved by security holders 116,624 $ 16.20 293,304 (1) There are no equity compensation plans not approved by stockholders.
Share repurchase activity under the share repurchase program, on a trade date basis, for each month in the quarter ended September 28, 2024, was as follows: Period by fiscal month Total number of shares repurchased Average price paid per share (in dollars) (1) Total number of shares repurchased as part of publicly announced plans or programs (2) Approximate dollar value of shares that may yet be purchased under the plans or programs (in millions) June 30 - July 27, 2024 — $ — — $ 60.0 July 28 - August 24, 2024 20,000 48.86 20,000 59.0 August 25 - September 28, 2024 181,818 49.29 181,818 50.1 Total 201,818 201,818 (1) Average price paid per share includes costs associated with the repurchases, except for the cost of any associated excise tax.
Share repurchase activity under the share repurchase programs, on a trade date basis, for each fiscal month in the quarter ended September 27, 2025, was as follows: Period by fiscal month Total number of shares repurchased Average price paid per share (in dollars) (1) Total number of shares repurchased as part of publicly announced plans or programs (2) Approximate dollar value of shares that may yet be purchased under the plans or programs (in millions) June 29 - July 26, 2025 3,302 $ 42.02 3,302 $ 10.9 July 27 - August 23, 2025 8,684 43.01 8,684 110.6 August 24 - September 27, 2025 401 55.03 401 110.5 Total 12,387 12,387 (1) Average price paid per share includes costs associated with the repurchases, except for the cost of any associated excise tax.
Under the share repurchase program, the Company may repurchase shares through open market purchases, privately negotiated transactions, accelerated share repurchase transactions, block purchases or otherwise in accordance with applicable federal securities laws, including Rule 10b-18 of the Securities Exchange Act of 1934, as amended. 29 The Board of Directors also authorized the Company to enter into written trading plans pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended.
Under both share repurchase programs, the Company may repurchase shares through open market purchases, privately negotiated transactions, accelerated share repurchase transactions, block purchases or otherwise in accordance with applicable federal securities laws, including Rule 10b-18 of the Exchange Act.
Additionally, NFI Group Inc. is traded on the Toronto Stock Exchange in Canadian Dollars. The hypothetical investment in NFI Group Inc. assumes investing $100 U.S. Dollars to acquire shares on September 28, 2019. The value of such shares at each of the above dates is then translated from Canadian Dollars to U.S. Dollars for inclusion in the peer group index.
Dollars to acquire shares on October 3, 2020. The value of such shares at each of the above dates is then translated from Canadian Dollars to U.S. Dollars for inclusion in the peer group index.
The following stock performance graph compares the total stockholder return of an investment of $100 in cash from September 28, 2019 through September 28, 2024. 28 Cumulative Total Return September 28, 2019 October 3, 2020 October 2, 2021 October 1, 2022 September 30, 2023 September 28, 2024 Blue Bird Corporation 100 63 112 44 112 254 Russell 3000 100 113 149 120 142 189 Peer Group 100 113 162 102 135 153 (1) Peer Group Astec Industries Inc.
The following stock performance graph compares the total stockholder return of an investment of $100 in cash from October 3, 2020 through September 27, 2025. 28 Cumulative Total Return October 3, 2020 October 2, 2021 October 1, 2022 September 30, 2023 September 28, 2024 September 27, 2025 Blue Bird Corporation 100 177 69 177 402 481 Russell 3000 100 132 106 125 166 192 Peer Group 100 147 96 128 154 223 (1) Peer Group Astec Industries Inc.
Given our business model and brand recognition, we believe that the specialty vehicle OEMs and branded industrial companies that we have selected represent the most comparable publicly traded companies to Blue Bird. While Lion Electric Company is within Blue Bird's peer group, it is not included in the chart above as it has only been publicly traded since May 2021.
Given our business model and brand recognition, we believe that the specialty vehicle OEMs and branded industrial companies that we have selected represent the most comparable publicly traded companies to Blue Bird.
Commercial Vehicle Group Inc. Douglas Dynamics, Inc. Federal Signal Corp. NFI Group Inc. Rev Group Inc. The Shyft Group, Inc. Thor Industries Inc. Wabash National Corp Other than Lion Electric Company, Blue Bird is the only publicly traded school bus company. As such, our peer group is not constructed on a line-of-business basis.
Wabash National Corp Other than Lion Electric Company, which had its common stock delisted from the New York and Toronto Stock Exchanges during the early months of calendar year 2025, Blue Bird was and is the only publicly traded school bus company. As such, our peer group is not constructed on a line-of-business basis.
Removed
The Company has chosen to use the Russell 3000 Index as the broad-based index.
Added
The SEC requires the Company to include a line graph presentation comparing cumulative five year common stock returns with a broad-based stock index and either a nationally recognized industry index or an index of peer companies selected by the Company. The Company has chosen to use the Russell 3000 Index as the broad-based index.
Added
Commercial Vehicle Group Inc. Douglas Dynamics, Inc. Federal Signal Corp. NFI Group Inc. Rev Group Inc. Thor Industries Inc.
Added
While Lion Electric Company was included within Blue Bird's peer group, it is not included in the chart above given that its common stock was publicly traded only from May 2021 to February 2025. Additionally, NFI Group Inc. is traded on the Toronto Stock Exchange in Canadian Dollars. The hypothetical investment in NFI Group Inc. assumes investing $100 U.S.
Added
On August 5, 2025, the Board of Directors of the Company authorized and approved a second share repurchase program for up to $100 million of 29 outstanding shares of the Company’s common stock, expiring January 1, 2028.
Added
The Board of Directors also authorized the Company to enter into written trading plans pursuant to Rule 10b5-1 under the Exchange Act.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeFinancial Statements and Supplementary Data 49 Reports of Independent Registered Public Accounting Firm (BDO USA, P.C.; Atlanta, GA; PCAOB ID #243) 49 Consolidated Balance Sheets 52 Consolidated Statements of Operations 53 Consolidated Statements of Comprehensive Income (Loss) 54 Consolidated Statements of Cash Flows 55 Consolidated Statements of Stockholders' (Deficit) Equity 57 Notes to Consolidated Financial Statements 58
Biggest changeFinancial Statements and Supplementary Data 49 Reports of Independent Registered Public Accounting Firm (BDO USA, P.C.; Atlanta, GA; PCAOB ID #243) 49 Consolidated Balance Sheets 52 Consolidated Statements of Operations 53 Consolidated Statements of Comprehensive Income 54 Consolidated Statements of Cash Flows 55 Consolidated Statements of Stockholders' Equity 57 Notes to Consolidated Financial Statements 58

Item 7. Management's Discussion & Analysis

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

121 edited+49 added−41 removed96 unchanged
Biggest changeThe increase in Adjusted EBITDA is primarily the result of a $69.6 million increase in net income, as a result of the factors discussed above, the corresponding $20.4 million increase in income tax expense, the $7.4 million in stockholder transaction costs that were incurred in fiscal 2023 with no similar costs incurred in fiscal 2022 and the $5.5 million increase in Micro Bird's total interest expense, net; income tax expense or benefit; depreciation expense and amortization expense, which primarily resulted from a $4.2 million increase in income tax expense as a result of Micro Bird reporting net income during fiscal 2023 and a net loss in fiscal 2022. 40 The following table sets forth a reconciliation of net income (loss) to Adjusted EBITDA for the fiscal years presented: (in thousands) 2023 2022 Net income (loss) $ 23,812 $ (45,759) Adjustments: Interest expense, net (1) 17,380 14,973 Income tax expense (benefit) 8,953 (11,451) Depreciation, amortization, and disposals (2) 17,914 15,212 Operational transformation initiatives 1,757 7,213 Loss on debt modification 537 632 Share-based compensation expense 4,173 3,690 Product redesign initiatives — 549 Stockholder transaction costs 7,371 — Micro Bird total interest expense, net; income tax expense or benefit; depreciation expense and amortization expense 5,456 (90) Other 574 285 Adjusted EBITDA $ 87,927 $ (14,746) Adjusted EBITDA Margin (percentage of net sales) 7.8 % (1.8) % (1) Includes $0.4 million and $0.3 million for fiscal 2023 and 2022, respectively, representing interest expense on operating lease liabilities, which are a component of lease expense and presented as a single operating expense in selling, general and administrative expenses on our Consolidated Statements of Operations.
Biggest changeThe following table sets forth a reconciliation of net income to Adjusted EBITDA for the fiscal years presented: (in thousands) 2025 2024 Net income $ 127,720 $ 105,547 Adjustments: Interest expense, net (1) 1,318 6,847 Income tax expense 43,926 33,228 Depreciation, amortization, and disposals (2) 17,223 16,736 Loss on debt refinancing or modification — 1,558 Share-based compensation expense 14,785 8,609 Clean Bus Solutions impairment 7,394 — Stockholder transaction costs — 3,154 Micro Bird total interest expense, net; income tax expense or benefit; depreciation expense and amortization expense 8,970 7,362 Other — (132) Adjusted EBITDA $ 221,336 $ 182,909 Adjusted EBITDA Margin (percentage of net sales) 15.0 % 13.6 % (1) Includes $0.3 million and $0.4 million for fiscal 2025 and fiscal 2024, respectively, representing interest expense on operating lease liabilities, which are a component of lease expense and presented as a single operating expense within cost of goods sold or selling, general and administrative expenses on our Consolidated Statements of Operations.
Nonetheless, the lessons learned, and resulting actions taken, by management over the past three fiscal years allowed the Company to better navigate these supply chain challenges and consistently produce buses to fulfill sales orders.
Nonetheless, the lessons learned, and resulting actions taken, by management over the past three fiscal years allowed the Company to better navigate these supply chain challenges to consistently produce buses to fulfill sales orders.
In the years preceding the 2020 COVID-19 pandemic, our sales were subject to seasonal variation based on the school calendar with the peak season during our third and fourth fiscal quarters.
In the fiscal years preceding the 2020 COVID-19 pandemic, our sales were subject to seasonal variation based on the school calendar with the peak season during our third and fourth fiscal quarters.
These payments totaled $2.7 million in fiscal 2024 and were recorded in other (expense) income, net in the Consolidated Statements of Operations because such compensation is not reflective of wages paid for services provided by the direct and indirect employees who support our operating activities and is expensed within cost of goods sold.
These payments totaled $2.7 million in fiscal 2024 and were recorded in other income (expense), net in the Consolidated Statements of Operations because such compensation is not reflective of wages paid for services provided by the direct and indirect employees who support our operating activities and is expensed within cost of goods sold.
Additionally, consolidated EBITDA, which is an adjusted EBITDA metric defined by our Credit Agreement (defined below) that could differ from Adjusted EBITDA discussed above as the adjustments to the calculations are not uniform, is used to determine the Company's ongoing compliance with several financial covenant requirements, including being utilized in the denominator of the calculation of the Total Net Leverage Ratio ("TNLR"), which is also utilized in determining the interest rate we pay on borrowings under our Credit Agreement (defined below).
Additionally, consolidated EBITDA, which is an adjusted EBITDA metric defined by our Credit Agreement (defined below) that could differ from Adjusted EBITDA discussed above as the adjustments to the calculations are not uniform, is used to determine the Company's ongoing compliance with several financial covenant requirements, including being utilized in the denominator of the calculation of the Total Net Leverage Ratio ("TNLR"), which is also utilized in determining the 33 interest rate we pay on borrowings under our Credit Agreement (defined below).
Also contributing was increased inventory costs, as the average cost of goods sold per unit for fiscal 2024 was 4.2% higher compared to fiscal 2023, primarily due to product and mix changes as well as increases in manufacturing costs attributable to a) increased raw materials costs resulting from ongoing inflationary pressures and b) ongoing supply chain disruptions that resulted in higher purchase costs for components.
Also contributing was increased 38 inventory costs, as the average cost of goods sold per unit for fiscal 2024 was 4.2% higher compared to fiscal 2023, primarily due to product and mix changes as well as increases in manufacturing costs attributable to a) increased raw materials costs resulting from ongoing inflationary pressures and b) ongoing supply chain disruptions that resulted in higher purchase costs for components.
The Company recognizes uncertain tax positions based on a cumulative probability assessment if it is more likely than not that the tax position will be sustained upon examination by an appropriate tax authority with full knowledge of all information. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized.
The Company recognizes uncertain tax positions, if any, based on a cumulative probability assessment if it is more likely than not that the tax position will be sustained upon examination by an appropriate tax authority with full knowledge of all information. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized.
In addition, Blue Bird is the market leader in alternative powered product offerings with its propane powered, gasoline powered, and all-electric powered school buses. Blue Bird sells its buses and parts through an extensive network of U.S. and Canadian dealers that, in their territories, are exclusive to Blue Bird on Type C and Type D school buses.
In addition, Blue Bird is the market leader in alternative powered product offerings with its propane powered, gasoline powered, and all-electric powered school buses. 30 Blue Bird sells its buses and parts through an extensive network of U.S. and Canadian dealers that, in their territories, are exclusive to Blue Bird on Type C and Type D school buses.
An effective dealer is capable of expanding revenues within a given school district by matching that district’s needs to our capabilities, offering options that would not otherwise be provided to the district. 32 • Pricing . Our products are sold to school districts throughout the U.S. and Canada.
An effective dealer is capable of expanding revenues within a given school district by matching that district’s needs to our capabilities, offering options that would not otherwise be provided to the district. • Pricing . Our products are sold to school districts throughout the U.S. and Canada.
For example, significant management judgments are required in determining excess, obsolete, or unsalable inventory; allowance for doubtful accounts; potential impairment of long-lived assets, goodwill and intangible assets; and the accounting for self-insurance reserves, warranty reserves, pension obligations, income taxes, environmental liabilities and 45 contingencies.
For example, significant management judgments are required in determining excess, obsolete, or unsalable inventory; allowance for doubtful accounts; potential impairment of long-lived assets, goodwill and intangible assets; and the accounting for self-insurance reserves, warranty reserves, pension obligations, income taxes, environmental liabilities and contingencies.
We use Free Cash Flow, and ratios based on Free Cash Flow, to conduct and evaluate our business because, although it is similar to cash flow from operations, we believe it is a more conservative measure of cash flow since purchases of fixed assets and intangible assets are a necessary component of ongoing operations.
We use Free Cash Flow, and ratios based on Free Cash Flow, to conduct and evaluate our business because, although it is similar to cash flow from operations, we believe it is a more conservative measure of cash flow since purchases of fixed assets and intangible assets are a necessary component of ongoing manufacturing operations.
Recent Accounting Pronouncements A discussion of recently issued accounting standards applicable to the Company is described in Note 2, Summary of Significant Accounting Policies and Recently Issued Accounting Standards, in the Notes to Consolidated Financial Statements contained elsewhere in this Report, and we incorporate such discussion by reference herein.
Recent Accounting Pronouncements A discussion of recently issued accounting standards applicable to the Company is described in Note 2, Summary of Significant Accounting Policies and Recently Issued Accounting Standards, in the Notes to Consolidated Financial Statements contained elsewhere in this Report, and we incorporate such discussion by reference herein. 47
EPA in administering the CSBP that were recorded as unearned revenue within other current liabilities (which is included within accrued expenses, pension and other liabilities). As we built and sold the underlying buses during fiscal 2024, we recognized 43 this amount in revenue.
EPA in administering the CSBP that were recorded as unearned revenue within other current liabilities (which is included within accrued expenses, pension and other liabilities). As we built and sold the underlying buses during fiscal 2024, we recognized this amount in revenue.
The fair value of our trade name is derived by using the relief from 46 royalty method, which discounts the estimated cash savings we realize by owning the name instead of otherwise having to license or lease it.
The fair value of our trade name is derived by using the relief from royalty method, which discounts the estimated cash savings we realize by owning the name instead of otherwise having to license or lease it.
Under the qualitative assessment, an entity is not required to calculate the fair value of a reporting unit unless the entity determines that it is more likely than not that its fair value is less than its carrying amount.
Under the 45 qualitative assessment, an entity is not required to calculate the fair value of a reporting unit unless the entity determines that it is more likely than not that its fair value is less than its carrying amount.
Among other items, the CBA required the payment of a $750 signing bonus to the approximate 1,500 covered workers in our Fort Valley and Perry, Georgia facilities as well as a lump-sum payment to certain employees who were not eligible for the approximate 12%, on average, year one wage increase because their current hourly wage rate exceeded the rate required by the terms of the CBA.
Among other items, the CBA required the payment of a $750 signing bonus to the approximate 1,500 covered workers in our Fort Valley and Macon, Georgia facilities as well as a lump-sum payment to certain employees who were not eligible for the approximate 12%, on average, year one wage increase because their current hourly wage rate exceeded the rate required by the terms of the CBA.
On December 14, 2023, the Company entered into an underwriting agreement with BofA Securities, Inc. and Barclays Capital Inc., as representatives of the several underwriters and American Securities LLC ("2024 Selling Stockholder"), pursuant to which the 2024 Selling Stockholder agreed to sell 2,500,000 shares of common stock at a purchase price of $25.10 per share.
Finally, on December 14, 2023, the Company entered into an underwriting agreement with BofA Securities, Inc. and Barclays Capital Inc., as representatives of the several underwriters and American Securities LLC ("2024 Selling Stockholder"), pursuant to which the 2024 Selling Stockholder agreed to sell 2,500,000 shares of common stock at a purchase price of $25.10 per share ("December Offering").
Borrowings under the Credit Facilities bear interest, at our option, at (i) base rate ("ABR") or (ii) the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York ("SOFR") plus 0.10%, plus an applicable margin depending on the TNLR (which is defined in the Credit Agreement as the ratio of consolidated net debt to consolidated EBITDA on a trailing four quarter basis) of the Company as follows: Level TNLR ABR Loans SOFR Loans I Less than 1.00x 0.75% 1.75% II Greater than or equal to 1.00x and less than 1.50x 1.50% 2.50% III Greater than or equal to 1.50x and less than 2.25x 2.00% 3.00% IV Greater than or equal to 2.25x 2.25% 3.25% Pricing on the Closing Date was set at Level III until receipt of the financial information and related compliance certificate for the first fiscal quarter ending after the Closing Date, with pricing as of September 28, 2024 set at Level I.
Borrowings under the Credit Facilities bear interest, at our option, at (i) base rate ("ABR") or (ii) the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York ("SOFR") plus 0.10%, plus an applicable margin depending on the TNLR (which is defined in the Credit Agreement as the ratio of consolidated net debt to consolidated EBITDA on a trailing four quarter basis) of the Company as follows: Level TNLR ABR Loans SOFR Loans I Less than 1.00x 0.75% 1.75% II Greater than or equal to 1.00x and less than 1.50x 1.50% 2.50% III Greater than or equal to 1.50x and less than 2.25x 2.00% 3.00% IV Greater than or equal to 2.25x 2.25% 3.25% Pricing on the Closing Date was set at Level III until receipt of the financial information and related compliance certificate for the first fiscal quarter ending after the Closing Date, with pricing as of September 27, 2025 set at Level I.
On February 15, 2024, the Company entered into an underwriting agreement with Barclays Capital Inc., as representative of the several underwriters and the 2024 Selling Stockholder, pursuant to which the 2024 Selling Stockholder agreed to sell 4,042,650 shares of common stock at a purchase price of $32.90 per share (collectively, the "2024 Offerings").
On February 15, 2024, the Company entered into an underwriting agreement with Barclays Capital Inc., as representative of the several underwriters and the 2024 Selling Stockholder, pursuant to which the 2024 Selling Stockholder agreed to sell 4,042,650 shares of common stock at a purchase price of $32.90 per share ("February Offering," and collectively with the December Offering, the "2024 Offerings").
Short-Term and Long-Term Liquidity Requirements Our ability to make principal and interest payments on borrowings under our Credit Facilities and our ability to fund planned capital expenditures will depend on our ability to generate cash in the future, which, to a certain extent, is subject to general economic, financial, competitive, regulatory and other conditions.
Short-Term and Long-Term Liquidity Requirements Our ability to make principal and interest payments on borrowings under our Credit Facilities, as applicable, and our ability to fund planned capital expenditures will depend on our ability to generate cash in the future, which, to a certain extent, is subject to general economic, financial, competitive, regulatory and other conditions.
Our selling, general and administrative expenses include costs associated with our selling and marketing efforts, engineering, centralized finance, human resources, purchasing, and information technology services, along with other administrative matters and functions. In most instances, other than direct costs associated with sales and marketing programs, the principal component of these costs is salary expense.
Our selling, general and administrative expenses include costs associated with our selling and marketing efforts, engineering, centralized finance, human resources, purchasing, information technology services, along with other administrative matters and functions. In most instances, other than direct costs associated with sales and marketing programs, the principal component of these costs is compensation expense.
We believe that Adjusted EBITDA and Adjusted EBITDA Margin are useful to investors in evaluating our performance because the measures consider the performance of our ongoing operations, excluding decisions made with respect to capital investment, financing, and certain other significant initiatives or transactions as outlined in the preceding paragraph.
We believe that Adjusted EBITDA and Adjusted EBITDA Margin are useful to investors in evaluating our performance because the measures consider the performance of our ongoing operations, excluding decisions made with respect to capital investment, financing, and certain other significant initiatives or transactions as outlined in the preceding paragraphs.
During fiscal 2024, the Company paid the above amounts to those employees covered by the CBA as well as similar amounts to a small number of hourly employees not covered by the CBA so that their total compensation is competitive with that of unionized employees performing comparable job functions.
During fiscal 2024, the Company paid the above amounts to those employees covered by the CBA as well as similar amounts to a small number of hourly employees not covered by the CBA so that their total compensation was competitive with that of unionized employees performing comparable job functions.
As the principal manufacturer of chassis and body production specifically designed for school bus applications in the U.S., Blue Bird is recognized as an industry leader for school bus innovation, safety, product quality/reliability/durability, efficiency, and lower operating costs.
As the only manufacturer of chassis and body production specifically designed for school bus applications in the U.S., Blue Bird is recognized as an industry leader for school bus innovation, safety, product quality/reliability/durability, efficiency, and lower operating costs.
The impacts from supply chain constraints on the Company's business and operations beginning during the second half of fiscal 2021 and continuing into fiscal 2024 negatively affected our inventory procurement costs, gross profit, income and cash flows.
The impacts from supply chain constraints on the Company's business and operations beginning during the second half of fiscal 2021 and continuing into fiscal 2025 negatively affected our inventory procurement costs, gross profit, income and cash flows.
Additionally, in certain cases, prices originally quoted with dealers and school districts may have become less favorable, or more unfavorable, to us given increasing inventory costs between the time the sales order was contractually agreed upon and the bus is built and delivered as a result of ongoing supply chain disruptions and general inflationary pressures. • Buying patterns of major fleets .
Additionally, in certain cases, prices originally quoted with dealers and school districts may have become less favorable, or more unfavorable, to us given increasing inventory costs between the time the sales order was contractually agreed upon and the bus is built and delivered as a result of ongoing supply chain disruptions, general inflationary pressures and/or changes in trade policies and tariffs. • Buying patterns of major fleets .
We include in this line item our 50% share of net income or loss from our investments in Micro Bird and Clean Bus Solutions, our unconsolidated joint ventures. Key Non-GAAP Financial Measures We Use to Evaluate Our Performance The consolidated financial statements included in this Report in Item 8.
We include in this line item our 50% share of net income or loss from our investments in Micro Bird Holdings, Inc. and Clean Bus Solutions, LLC, our unconsolidated joint ventures. Key Non-GAAP Financial Measures We Use to Evaluate Our Performance The consolidated financial statements included in this Report in Item 8.
As discussed previously above, supply chain disruptions developing subsequent to the COVID-19 pandemic and Russia's invasion of Ukraine have significantly increased our inventory purchase costs, including freight costs incurred to expedite receipt of critical components, reflected in cost of goods sold during all of fiscal 2022, and continuing, to a lesser extent, into fiscal 2023 and fiscal 2024.
As discussed previously above, supply chain disruptions developing subsequent to the COVID-19 pandemic and Russia's invasion of Ukraine have significantly increased our inventory purchase costs, including freight costs incurred to deliver critical components, reflected in cost of goods sold during all of fiscal 2022 and continuing, to a lesser extent, into fiscal 2023, fiscal 2024 and fiscal 2025.
While certain of the charges that are added back in the Adjusted EBITDA calculation, such as transaction related costs and operational transformation and major product redesign initiatives, represent operating expenses that may be recorded in more than one annual period, the significant project or transaction giving rise to such expenses is not considered to be indicative of the Company’s normal operations.
While certain of the charges that are added back in the Adjusted EBITDA calculation, such as transaction related costs and major cost cutting and/or operational transformation initiatives, represent operating expenses that may be recorded in more than one annual period, the significant project or transaction giving rise to such expenses is not considered to be indicative of the Company’s normal operations.
Also, on May 23, 2024, eligible members of the USW voted to ratify a three-year CBA with Blue Bird Body Company ("BBBC"), a subsidiary of the Company.
Additionally, on May 23, 2024, eligible members of the USW voted to ratify a three-year CBA with Blue Bird Body Company ("BBBC"), a subsidiary of the Company.
We make estimates of the amounts to recognize for income taxes in each tax jurisdiction in which we operate. In addition, provisions are established for withholding taxes related to the transfer of cash between jurisdictions and for uncertain tax positions taken. 33 • Other income/expense, net .
We make estimates of the amounts to recognize for income taxes in each tax jurisdiction in which we operate. In addition, provisions are established for withholding taxes related to the transfer of cash between jurisdictions and for uncertain tax positions taken, if any. • Other expense/income, net .
The primary drivers of the $8.8 million decrease were the following: The net decrease primarily resulted from the effect of net changes in operating assets and liabilities that negatively impacted operating cash flows by $84.1 million during fiscal 2024 when compared with fiscal 2023.
The primary drivers of the $8.8 million decrease were as follows: The net decrease primarily resulted from the effect of net changes in operating assets and liabilities that negatively impacted operating cash flows by $84.1 million during fiscal 2024 when compared with fiscal 2023.
Supply chain disruptions continued into fiscal 2024 as there were still occasional shortages of certain critical components as well as ongoing increases in raw materials costs, both of which impacted our business and operations by limiting the number of school buses that we could produce and sell as well as increasing the costs to manufacture buses.
Supply chain disruptions continued into fiscal 2025 as there were still occasional shortages of certain critical components as well as ongoing increases in raw materials costs, both of which impacted our business and operations by limiting the number and/or mix of school buses that we could produce and sell as well as increasing the costs to manufacture buses.
These assets are tested for impairment whenever events or changes in circumstances indicate the carrying amount of the assets may not be recoverable. No impairments have been recorded. The recorded balances for goodwill were $15.1 million and $3.7 million for the Bus and Parts segments, respectively, at both September 28, 2024 and September 30, 2023.
These assets are tested for impairment whenever events or changes in circumstances indicate the carrying amount of the assets may not be recoverable. No impairments have been recorded. The recorded balances for goodwill were $15.1 million and $3.7 million for the Bus and Parts segments, respectively, at both September 27, 2025 and September 28, 2024.
Our cost of goods sold may vary from period to period due to changes in sales volume, efforts by certain suppliers to pass through the economics associated with key commodities, fluctuations in freight costs, design changes with respect to specific components, design changes with respect to specific bus models, wage increases for plant labor, productivity of plant labor, delays in receiving materials and other logistical challenges, and the impact of overhead items such as utilities. • Selling, general and administrative expenses .
Our cost of goods sold may vary from period to period due to changes in sales volume and/or mix, efforts by certain suppliers to pass through the economics associated with key commodities as well as changes in trade policies and tariffs, fluctuations in freight costs, design changes with respect to specific components, design changes with respect to specific bus models, wage increases for plant labor, productivity of plant labor, delays in receiving materials and other logistical challenges, and the impact of overhead items such as utilities. • Selling, general and administrative expenses .
Amounts recorded for uncertain tax positions are periodically assessed, including the evaluation of new facts and circumstances, to ensure sustainability of the positions. The Company records interest and penalties related to unrecognized tax benefits in income tax expense. There was no liability for uncertain tax positions at September 28, 2024 or September 30, 2023.
Amounts recorded for uncertain tax positions are periodically assessed, including the evaluation of new facts and circumstances, to ensure sustainability of the positions. The Company records interest and penalties related to unrecognized tax benefits in income tax expense. There was no liability for uncertain tax positions at September 27, 2025 or September 28, 2024.
The $100.0 million of Term Loan Facility proceeds and $36.2 million of Revolving Credit Facility proceeds that were borrowed on the Closing Date were used to pay (i) the $131.8 million of term loan indebtedness outstanding under the previous credit agreement ("Amended 2016 Credit Agreement"), which was also the amount outstanding as of September 30, 2023 (there were no amounts outstanding on the revolving credit facility portion of the Amended 2016 Credit Agreement on either date), (ii) interest and commitment fees accrued under the Amended 2016 Credit Agreement through the Closing Date and (iii) transaction costs associated with the consummation of the Credit Agreement.
The $100.0 million of Term Loan Facility proceeds and $36.2 million of Revolving Credit Facility proceeds that were borrowed on the Closing Date were used to pay (i) the $131.8 million of term loan indebtedness outstanding under the previous credit agreement, which was also the amount outstanding as of September 28, 2024 (there were no amounts outstanding on the revolving credit facility portion of the previous credit agreement on either date), (ii) interest and commitment fees accrued under the previous credit agreement through the Closing Date and (iii) transaction costs associated with the consummation of the Credit Agreement.
Later that same month, the Company retired the shares of common stock that had previously been reflected as treasury stock within its historical consolidated financial statements by recording the amount paid in excess of the $0.0001 par value of each share as a $39.9 million reduction in retained earnings, which reduced the value in this account to zero, with the remaining $10.4 million recorded as a reduction in additional paid-in capital.
In fiscal 2024, the Company also retired the shares of common stock that had previously been reflected as treasury stock within its historical consolidated financial statements by recording the amount paid in excess of the $0.0001 par value of each share as a $39.9 million reduction in retained earnings, which reduced the value in this account to zero, with the remaining $10.4 million recorded as a reduction in additional paid-in capital.
Accordingly, while management believes that this methodology provides an accurate reserve estimate, actual claims incurred could differ from the original estimates, requiring future adjustments. For example, at September 28, 2024, a 5% increase or decrease in the average lifetime historical warranty claims by body type, by month would increase or decrease accrued product warranty costs by approximately $0.8 million.
Accordingly, while management believes that this methodology provides an accurate reserve estimate, actual claims incurred could differ from the original estimates, requiring future adjustments. For example, at September 27, 2025, a 5% increase or decrease in the average lifetime historical warranty claims by body type, by month would increase or decrease accrued product warranty costs by approximately $0.9 million.
Adjusted EBITDA is defined as net income or loss prior to interest income; interest expense including the component of operating lease expense (which is presented as a single operating expense in selling, general and administrative expenses in our U.S.
Adjusted EBITDA is defined as net income or loss prior to interest income; interest expense including the component of operating lease expense (which is presented as a single operating expense within cost of goods sold or selling, general and administrative expenses in our U.S.
Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of financial condition and results of operations of the Company should be read in conjunction with the Company’s audited financial statements for the fiscal years ended September 28, 2024, September 30, 2023 and October 1, 2022 and related notes appearing elsewhere in this Report.
Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of financial condition and results of operations of the Company should be read in conjunction with the Company’s audited financial statements for the fiscal years ended September 27, 2025, September 28, 2024 and September 30, 2023 and related notes appearing elsewhere in this Report.
Although we believe that Adjusted EBITDA and Adjusted EBITDA Margin may enhance an evaluation of our operating performance based on recent revenue generation and product/overhead cost control because they exclude the impact of prior decisions made about capital investment, financing, and certain other significant initiatives or transactions, (i) other companies in Blue Bird’s industry may define Adjusted EBITDA and Adjusted EBITDA Margin differently than we do and, as a result, they may not be comparable to similarly titled measures used by other companies in Blue Bird’s industry, and (ii) Adjusted EBITDA and Adjusted EBITDA Margin exclude certain financial information that some may consider important in evaluating our performance.
Although we believe that Adjusted EBITDA and Adjusted EBITDA Margin may enhance an evaluation of our operating performance because they exclude the impact of prior decisions made about capital investment, financing, and certain other significant initiatives or transactions, (i) other companies in Blue Bird’s industry may define Adjusted EBITDA and Adjusted EBITDA Margin differently than we do and, as a result, they may not be comparable to similarly titled measures used by other companies in Blue Bird’s industry, and (ii) Adjusted EBITDA and Adjusted EBITDA Margin exclude certain financial information that some may consider important in evaluating our performance.
GAAP financial statements) that represents interest expense on lease liabilities; income taxes; and depreciation and amortization including the component of operating lease expense (which is presented as a single operating expense in selling, general and administrative expenses in our U.S.
GAAP financial statements) that represents interest expense on lease liabilities; income taxes; and depreciation and amortization including the component of operating lease expense (which is presented as a single operating expense within cost of goods sold or selling, general and administrative expenses in our U.S.
GAAP financial statements) that represents amortization charges on right-of-use lease assets; as adjusted for certain non-cash charges or credits that we may record on a recurring basis such as share-based compensation expense and unrealized gains or losses on certain derivative financial instruments; net gains or losses on the disposal of assets as well as certain charges such as (i) significant product design changes; (ii) transaction related costs; (iii) discrete expenses related to major cost cutting and/or operational transformation initiatives.
GAAP financial statements) that represents amortization charges on right-of-use lease assets; as adjusted for certain non-cash charges or credits that we may record on a recurring basis such as share-based compensation expense and unrealized gains or losses on certain derivative financial instruments as well as certain charges such as (i) transaction related costs or (ii) discrete expenses related to major cost cutting and/or operational transformation initiatives.
We are required to consider current market conditions, including changes in interest rates, in making these assumptions. Effective January 1, 2006, the benefit plan was frozen to all participants. No accrual of future benefits is earned or calculated beyond this date.
We are required to consider current market conditions, including changes in interest rates, as well as changes in other facts and circumstances in making these assumptions. Effective January 1, 2006, the benefit plan was frozen to all participants. No accrual of future benefits is earned or calculated beyond this date.
The establishment of the reserves utilizing such estimates and assumptions is based on the premise that historical claims experience, both in terms of the volume of claims activity and related cost, is indicative of current or future expected activity, which could differ significantly. At September 28, 2024 and September 30, 2023, reserves totaled approximately $7.3 million and $6.2 million, respectively.
The establishment of the reserves utilizing such estimates and assumptions is based on the premise that historical claims experience, both in terms of the volume of claims activity and related cost, is indicative of current or future expected activity, which could differ significantly. At September 27, 2025 and September 28, 2024, reserves totaled approximately $7.1 million and $7.3 million, respectively.
During fiscal 2024, we used cash generated from operations to make $3.8 million of required quarterly principal payments on the Term Loan Facility and repay all $36.2 million of Revolving Credit Facility borrowings from the Closing Date.
During fiscal 2025 and fiscal 2024, we used cash generated from operations to make (i) $5.0 million of required quarterly principal payments on the Term Loan Facility and (ii) $3.8 million of required quarterly principal payments on the Term Loan Facility and repay all $36.2 million of Revolving Credit Facility borrowings from the Closing Date, respectively.
With the COVID-19 pandemic impacting the demand for Company products and the impact of the subsequent supply chain constraints hindering the Company's ability to produce and sell buses, seasonality has become unpredictable. Seasonality and variations from historical seasonality have impacted the comparison of results between fiscal periods. • Inflation.
Since 2020, with the COVID-19 pandemic impacting the demand for Company products and the impact of the subsequent supply chain constraints hindering the 32 Company's ability to produce and sell buses as discussed previously above, seasonality has become unpredictable. Seasonality and variations from historical seasonality have impacted the comparison of results between fiscal periods. • Inflation.
Towards the end of fiscal 2022 and continuing into fiscal 2023, there were slight improvements in the supply chain's ability to deliver the parts and components necessary to support our production operations, resulting in increased (i) manufacturing efficiencies and (ii) production of buses to fulfill sales orders during fiscal 2023.
During fiscal 2023 and fiscal 2024, there were slight improvements in the supply chain's ability to deliver the parts and components necessary to support our production operations, resulting in increased (i) manufacturing efficiencies and (ii) production of buses to fulfill sales orders.
Consolidated Results of Operations for the fiscal years ended September 28, 2024 and September 30, 2023: (in thousands) 2024 2023 Net sales $ 1,347,154 $ 1,132,793 Cost of goods sold 1,090,998 993,943 Gross profit $ 256,156 $ 138,850 Operating expenses Selling, general and administrative expenses 116,825 87,193 Operating profit $ 139,331 $ 51,657 Interest expense (10,579) (18,012) Interest income 4,136 1,004 Other expense, net (4,394) (8,307) Loss on debt refinancing or modification (1,558) (537) Income before income taxes $ 126,936 $ 25,805 Income tax expense (33,228) (8,953) Equity in net income of non-consolidated affiliate(s) 11,839 6,960 Net income $ 105,547 $ 23,812 Other financial data: Adjusted EBITDA $ 182,909 $ 87,927 Adjusted EBITDA Margin 13.6 % 7.8 % 35 The following provides the results of operations of Blue Bird's two reportable segments: (in thousands) 2024 2023 Net Sales by Segment Bus $ 1,242,885 $ 1,034,625 Parts 104,269 98,168 Total $ 1,347,154 $ 1,132,793 Gross Profit by Segment Bus $ 203,791 $ 91,003 Parts 52,365 47,847 Total $ 256,156 $ 138,850 Net sales .
(2) Includes $1.6 million for both fiscal 2025 and fiscal 2024, representing amortization charges on right-of-use operating lease assets, which are a component of lease expense and presented as a single operating expense within cost of goods sold or selling, general and administrative expenses on our Consolidated Statements of Operations. 37 Consolidated Results of Operations for the fiscal years ended September 28, 2024 and September 30, 2023: (in thousands) 2024 2023 Net sales $ 1,347,154 $ 1,132,793 Cost of goods sold 1,090,998 993,943 Gross profit $ 256,156 $ 138,850 Operating expenses Selling, general and administrative expenses 116,825 87,193 Operating profit $ 139,331 $ 51,657 Interest expense (10,579) (18,012) Interest income 4,136 1,004 Other expense, net (4,394) (8,307) Loss on debt refinancing or modification (1,558) (537) Income before income taxes $ 126,936 $ 25,805 Income tax expense (33,228) (8,953) Equity in net income of non-consolidated affiliate(s) 11,839 6,960 Net income $ 105,547 $ 23,812 Other financial data: Adjusted EBITDA $ 182,909 $ 87,927 Adjusted EBITDA Margin 13.6 % 7.8 % The following provides the results of operations of Blue Bird's two reportable segments: (in thousands) 2024 2023 Net Sales by Segment Bus $ 1,242,885 $ 1,034,625 Parts 104,269 98,168 Total $ 1,347,154 $ 1,132,793 Gross Profit by Segment Bus $ 203,791 $ 91,003 Parts 52,365 47,847 Total $ 256,156 $ 138,850 Net sales .
In general, management believes that supply chain disruptions could continue in future periods and could materially impact our results if we are unable to i) obtain parts and supplies in sufficient quantities to meet our production needs and/or ii) pass along rising costs to our customers.
In general, management believes that supply chain disruptions, including those resulting from current or future military conflicts, could continue in future periods and could materially impact our results if we are unable to i) obtain parts and supplies in sufficient quantities to meet our production needs and/or ii) pass along rising costs to our customers.
Although the Company did not sell any shares or receive any proceeds from the 2023 Offerings or 2024 Offerings, it was required to pay certain expenses in connection with these transactions that totaled approximately $7.4 million and $3.2 million in fiscal 2023 and fiscal 2024, respectively.
The 2023 Offerings closed on June 12, 2023 and September 14, 2023, respectively. 39 Although the Company did not sell any shares or receive any proceeds from the 2024 Offerings or 2023 Offerings, it was required to pay certain expenses in connection with these transactions that totaled approximately $3.2 million and $7.4 million in fiscal 2024 and fiscal 2023, respectively.
Based on the current level of operations, we believe that our existing cash and cash equivalent balances and expected cash flows from operations will be sufficient to meet our operating requirements for at least the next 12 months. We have operating leases for office and warehouse space and finance leases for equipment.
Based on the current level of operations, we believe that our existing cash and cash equivalent balances and expected cash flows from operations will be sufficient to meet our operating requirements for at least the next 12 months. We have operating leases for office and warehouse space, or a combination of both, as well as equipment.
The recorded balances for intangible assets were $43.6 million and $45.4 million at September 28, 2024 and September 30, 2023, respectively. Pensions We have pension benefit costs and obligations, which are developed from actuarial valuations. Actuarial assumptions attempt to anticipate future events and are used in calculating the expense and liability relating to our plan.
The recorded balances for intangible assets were $41.7 million and $43.6 million at September 27, 2025 and September 28, 2024, respectively. Pensions We have pension benefit costs and obligations, which are developed from actuarial valuations. Actuarial assumptions attempt to anticipate future events and are used in calculating the expense and liability relating to our plan.
The projected benefit obligation for the pension plan was $113.6 million and $108.4 million at September 28, 2024 and September 30, 2023, respectively. Product Warranty Costs The Company’s products are generally warranted against defects in material and workmanship for a period of one to five years.
The projected benefit obligation for the pension plan was $109.6 million and $113.6 million at September 27, 2025 and September 28, 2024, respectively. Product Warranty Costs The Company’s products are generally warranted against defects in material and workmanship for a period of one to five years.
Among other smaller offsetting items, these increases were partially offset by the $10.5 million decrease in interest expense, net as a result of the factors discussed above. 37 The following table sets forth a reconciliation of net income to Adjusted EBITDA for the fiscal years presented: (in thousands) 2024 2023 Net income $ 105,547 $ 23,812 Adjustments: Interest expense, net (1) 6,847 17,380 Income tax expense 33,228 8,953 Depreciation, amortization, and disposals (2) 16,736 17,914 Operational transformation initiatives — 1,757 Loss on debt refinancing or modification 1,558 537 Share-based compensation expense 8,609 4,173 Stockholder transaction costs 3,154 7,371 Micro Bird total interest expense, net; income tax expense or benefit; depreciation expense and amortization expense 7,362 5,456 Other (132) 574 Adjusted EBITDA $ 182,909 $ 87,927 Adjusted EBITDA Margin (percentage of net sales) 13.6 % 7.8 % (1) Includes $0.4 million for both fiscal 2024 and 2023, representing interest expense on operating lease liabilities, which are a component of lease expense and presented as a single operating expense in selling, general and administrative expenses on our Consolidated Statements of Operations.
The following table sets forth a reconciliation of net income to Adjusted EBITDA for the fiscal years presented: (in thousands) 2024 2023 Net income $ 105,547 $ 23,812 Adjustments: Interest expense, net (1) 6,847 17,380 Income tax expense 33,228 8,953 Depreciation, amortization, and disposals (2) 16,736 17,914 Operational transformation initiatives — 1,757 Loss on debt refinancing or modification 1,558 537 Share-based compensation expense 8,609 4,173 Stockholder transaction costs 3,154 7,371 Micro Bird total interest expense, net; income tax expense or benefit; depreciation expense and amortization expense 7,362 5,456 Other (132) 574 Adjusted EBITDA $ 182,909 $ 87,927 Adjusted EBITDA Margin (percentage of net sales) 13.6 % 7.8 % (1) Includes $0.4 million for both fiscal 2024 and fiscal 2023, representing interest expense on operating lease liabilities, which are a component of lease expense and presented as a single operating expense within cost of goods sold or selling, general and administrative expenses on our Consolidated Statements of Operations.
New bus orders during fiscal 2023 and continuing into fiscal 2024 remained robust, primarily due to a combination of (i) pent-up demand resulting from the cumulative effect of the COVID-19 pandemic when many school systems conducted virtual learning and (ii) the challenged global supply chain for automotive parts that hindered the school bus industry's ability to produce and sell buses during the latter half of fiscal 2021 and continuing through fiscal 2024.
New bus orders during fiscal 2024 and continuing into fiscal 2025 remained robust, primarily due to a combination of (i) pent-up demand resulting from the cumulative effect of the COVID-19 pandemic when many school systems conducted virtual learning and (ii) the challenged global supply chain for automotive parts that hindered the school bus industry's ability to produce and sell buses as discussed previously above.
At September 28, 2024 and September 30, 2023, accrued product warranty costs totaled approximately $16.2 million and $15.4 million, respectively. 47 Income Taxes The Company accounts for income taxes in accordance with the provisions of ASC 740, Income Taxes (“ASC 740”), which requires an asset and liability approach to financial accounting and reporting for income taxes.
At September 27, 2025 and September 28, 2024, accrued product warranty costs totaled approximately $17.2 million and $16.2 million, respectively. Income Taxes The Company accounts for income taxes in accordance with the provisions of ASC 740, Income Taxes (“ASC 740”), which requires an asset and liability approach to financial accounting and reporting for income taxes.
Our leases have remaining lease terms ranging from 0.2 years to 5.7 years with the option to extend certain leases for up to 1.0 year year. Finance leases run through fiscal 2025 and have total payments of approximately $1.0 million, all of which is due in fiscal 2025.
Our leases have remaining lease terms ranging from 0.5 years to 5.0 years, with the option to extend certain leases for up to 1.0 year, and total payments of approximately $7.1 million, of which approximately $2.6 million is due in fiscal 2026.
Under the share repurchase program, the Company may repurchase shares through open market purchases, privately negotiated transactions, accelerated share repurchase transactions, block purchases or otherwise in accordance with applicable federal securities laws, including Rule 10b-18 of the Securities Exchange Act of 1934, as amended.
Under both share repurchase programs, the Company may repurchase shares through open market purchases, privately negotiated transactions, accelerated share 44 repurchase transactions, block purchases or otherwise in accordance with applicable federal securities laws, including Rule 10b-18 of the Exchange Act.
Financial information is reported on the basis that it is used internally by the chief operating decision maker (“CODM”) in evaluating segment performance and deciding how to allocate resources to segments. The President and Chief Executive Officer of the Company has been identified as the CODM. Management evaluates the segments based primarily upon revenues and gross profit.
Financial information is reported on the basis that it is used internally by the CODM in evaluating segment 34 performance and deciding how to allocate resources to segments. The President and CEO of the Company has been identified as the CODM. Management evaluates the segments based primarily upon revenues and gross profit.
During fiscal 2022, capital spending was reduced to lower than normal amounts in an effort to mitigate the impact of supply chain constraints on our operations, financial results and cash flows. Total cash (used in) provided by financing activities Cash used in financing activities totaled $46.6 million for fiscal 2024 and $42.9 million for fiscal 2023.
During the first half of fiscal 2023, capital spending was reduced to lower than normal amounts in an effort to mitigate the impact of supply chain constraints on our operations, financial results and cash flows. Total cash used in financing activities Cash used in financing activities totaled $50.7 million for fiscal 2025 and $46.6 million for fiscal 2024.
The $3.7 million increase in cash used was primarily attributable to a $115.8 million increase in term loan repayments and $9.9 million in purchases of Company stock.
The $3.7 million increase in cash used was primarily attributable to a $115.8 million increase in term loan repayments and $9.9 million increase in purchases of Company stock in fiscal 2024 when compared with fiscal 2023.
At September 28, 2024, Borrower and the guarantors under the Credit Agreement were in compliance with all covenants.
At September 27, 2025, Borrower and the guarantors under the Credit Agreement were in compliance with all covenants.
For example, at September 28, 2024, a one-half percent increase in the discount rate would reduce the projected benefit obligation of our pension plans by approximately $4.9 million, while a one-half percent decrease in the discount rate would increase the projected benefit obligation of our pension plans by approximately $5.3 million.
For example, at September 27, 2025, a one-half percent increase in the discount rate would reduce the projected benefit obligation of our pension plans by approximately $3.8 million, while a one-half percent decrease in the discount rate would increase the projected benefit obligation of our pension plans by approximately $4.0 million.
(2) Includes $1.8 million and $1.1 million for fiscal 2023 and 2022, respectively, representing amortization on right-of-use operating lease assets, which are a component of lease expense and presented as a single operating expense in selling, general and administrative expenses on our Consolidated Statements of Operations.
(2) Includes $1.6 million and $1.8 million for fiscal 2024 and fiscal 2023, respectively, representing amortization charges on right-of-use operating lease assets, which are a component of lease expense and presented as a single operating expense within cost of goods sold or selling, general and administrative expenses on our Consolidated Statements of Operations.
We recorded $0.1 million of net periodic pension expense during fiscal 2024 when compared with $0.7 million recorded during fiscal 2023. 36 Additionally, on June 7, 2023, the Company entered into an underwriting agreement with BofA Securities, Inc. and Barclays Capital Inc., as representatives of the several underwriters and American Securities LLC, Coliseum Capital Partners, L.P., and Blackwell Partners LLC – Series A ("2023 Selling Stockholders"), pursuant to which the 2023 Selling Stockholders agreed to sell 5,175,000 shares of common stock, including the sale of 675,000 shares pursuant to the underwriters’ exercise of their over-allotment option, at a purchase price of $20.00 per share.
Finally, on June 7, 2023, the Company entered into an underwriting agreement with BofA Securities, Inc. and Barclays Capital Inc., as representatives of the several underwriters and American Securities LLC, Coliseum Capital Partners, L.P., and Blackwell Partners LLC – Series A (collectively, the "2023 Selling Stockholders"), pursuant to which the 2023 Selling Stockholders agreed to sell 5,175,000 shares of common stock, including the sale of 675,000 shares pursuant to the underwriters’ exercise of their over-allotment option, at a purchase price of $20.00 per share.
In mid-September 2024, the Company constructively retired the shares of common stock it had recently repurchased by recording the $9.9 million paid in excess of the $0.0001 par value of each share as a reduction in retained earnings.
In fiscal 2025 and fiscal 2024, the Company constructively retired the shares of common stock it repurchased by recording the $39.5 million and $9.9 million paid in excess of the $0.0001 par value of each share, respectively, as a reduction in retained earnings.
Credit Agreement On November 17, 2023 (the “Closing Date”), BBBC ("Borrower") executed a $250.0 million five-year credit agreement with Bank of Montreal, acting as administrative agent and an issuing bank; several joint lead arranger partners and issuing banks, including Bank of America; and a syndicate of other lenders (the "Credit Agreement").
The Company’s revolving line of credit is available for working capital requirements, capital expenditures and other general corporate purposes. 40 Credit Agreement On November 17, 2023 (the “Closing Date”), BBBC ("Borrower") executed a $250.0 million five-year credit agreement with Bank of Montreal, acting as administrative agent and an issuing bank; several joint lead arranger partners and issuing banks, including Bank of America; and a syndicate of other lenders (the "Credit Agreement").
Cash Flows The following table sets forth general information derived from our statement of cash flows for the fiscal years presented: (in thousands) 2024 2023 2022 Cash and cash equivalents, beginning of year $ 78,988 $ 10,479 $ 11,709 Total cash provided by (used in) operating activities 111,112 119,928 (24,437) Total cash used in investing activities (15,815) (8,520) (6,453) Total cash (used in) provided by financing activities (46,598) (42,899) 29,660 Change in cash and cash equivalents 48,699 68,509 (1,230) Cash and cash equivalents, end of year $ 127,687 $ 78,988 $ 10,479 Total cash provided by (used in) operating activities Cash provided by operating activities totaled $111.1 million for fiscal 2024 and $119.9 million for fiscal 2023.
Cash Flows The following table sets forth general information derived from our statement of cash flows for the fiscal years presented: (in thousands) 2025 2024 2023 Cash and cash equivalents, beginning of year $ 127,687 $ 78,988 $ 10,479 Total cash provided by operating activities 176,214 111,112 119,928 Total cash used in investing activities (23,872) (15,815) (8,520) Total cash used in financing activities (50,716) (46,598) (42,899) Change in cash and cash equivalents 101,626 48,699 68,509 Cash and cash equivalents, end of year $ 229,313 $ 127,687 $ 78,988 Total cash provided by operating activities Cash provided by operating activities totaled $176.2 million for fiscal 2025 and $111.1 million for fiscal 2024.
In response, beginning in July 2021, the Company announced a number of sales price increases that applied to new sales orders and partially applied to backlog orders that were both intended to mitigate the impact of rising purchase costs on our operations and results.
In response, the Company announced a number of sales price increases over this same period that applied to new sales orders and, in limited circumstances, to backlog orders that were both intended to mitigate the impact of rising purchase costs on our operations, results and cash flows.
Other expense, net, was $4.4 million for fiscal 2024, a decrease of $3.9 million, or 47.1%, compared to $8.3 million of other expense, net, in fiscal 2023.
Other expense, net, was $4.4 million for fiscal 2024, a decrease of $3.9 million, or 47.1%, compared to $8.3 million of other expense, net, in fiscal 2023. We recorded $0.1 million of net periodic pension expense during fiscal 2024 when compared with $0.7 million recorded during fiscal 2023.
Ongoing improvements in manufacturing operations, when coupled with periodic pricing actions taken by the Company to ensure that the increased sales prices charged for buses kept pace with increased costs to procure inventory to produce the buses, allowed the Company to report gross profits and gross margins throughout fiscal 2024 that were consistent with, or better than, historic levels experienced prior to the COVID-19 pandemic.
Ongoing improvements in manufacturing operations, when coupled with periodic pricing actions taken by the Company to ensure that the increased sales prices charged for buses keep pace with increased costs to procure inventory to produce the buses, allowed the Company to report gross profit and gross margin that were better than those reported in fiscal 2024.
Borrowings under the Term Loan Facility, which were made at the Closing Date, may not be reborrowed once they are repaid while borrowings under the Revolving Credit Facility may be repaid and reborrowed from time to time at our election. 41 The Term Loan Facility is subject to amortization of principal, payable in equal quarterly installments on the last day of each fiscal quarter, which commenced on March 30, 2024, with 5.0% of the $100.0 million aggregate principal amount of all initial term loans outstanding at the Closing Date payable each year prior to the maturity date of the Term Loan Facility.
The Term Loan Facility is subject to amortization of principal, payable in equal quarterly installments on the last day of each fiscal quarter, which commenced on March 30, 2024, with 5.0% of the $100.0 million aggregate principal amount of all initial term loans outstanding at the Closing Date payable each year prior to the maturity date of the Term Loan Facility.
The following table sets forth the calculation of Free Cash Flow for the fiscal years presented: (in thousands) 2024 2023 2022 Total cash provided by (used in) operating activities $ 111,112 $ 119,928 $ (24,437) Cash paid for fixed assets and acquired intangible assets (15,263) (8,520) (6,453) Free Cash Flow $ 95,849 $ 111,408 $ (30,890) Free Cash Flow for fiscal 2024 was $15.6 million lower than for fiscal 2023, due to an $8.8 million decrease in cash provided by operating activities, as well as a $6.7 million increase in cash paid for fixed assets, both as discussed above.
The following table sets forth the calculation of Free Cash Flow for the fiscal years presented: (in thousands) 2025 2024 2023 Total cash provided by operating activities $ 176,214 $ 111,112 $ 119,928 Cash paid for fixed assets and acquired intangible assets (22,872) (15,263) (8,520) Free Cash Flow $ 153,342 $ 95,849 $ 111,408 Free Cash Flow for fiscal 2025 was $57.5 million higher than for fiscal 2024, due to a $65.1 million increase in cash provided by operating activities, which was partially offset by a $7.6 million increase in cash paid for fixed assets, both as discussed above.
The increase in the effective tax rate to 34.7% was primarily due to the impacts of state taxes and certain permanent items on the Federal rate. The effective tax rate for fiscal 2022 differed from the statutory Federal income tax rate of 21.0%.
The increase was primarily due to the impacts of state taxes and certain permanent items on the federal rate, which were partially offset by the impacts from discrete period items. The effective tax rate for fiscal 2024 was 26.2% and differed from the statutory Federal income tax rate of 21.0%.
At September 28, 2024 and September 30, 2023, deferred tax liabilities totaled approximately $22.4 million and $22.9 million, respectively, while deferred tax assets totaled approximately $22.0 million and $22.6 million, respectively.
At September 27, 2025 and September 28, 2024, deferred tax liabilities totaled approximately $26.4 million and $22.4 million, respectively, while deferred tax assets totaled approximately $23.7 million and $22.0 million, respectively.
The 2023 Offerings were conducted pursuant to prospectus supplements, dated June 7, 2023 and September 11, 2023, respectively, to the prospectus, dated December 22, 2021, included in the Company’s registration statement on Form S-3 (File No. 333-261858) that was initially filed with the SEC on December 23, 2021 (the "December 2021 Prospectus").
The December Offering was conducted pursuant to a prospectus supplement, dated December 14, 2023, and the February Offering was conducted pursuant to a prospectus supplement, dated February 15, 2024, both to the prospectus dated December 22, 2021 36 included in the Company’s registration statement on Form S-3 (File No. 333-261858) that was initially filed with the SEC on December 23, 2021 ("December 2021 Prospectus").
The Credit Agreement also includes a requirement that the Company comply with the following financial covenants on the last day of each fiscal quarter through maturity: (i) a pro forma TNLR of not greater than 3.00:1.00 and (ii) a pro forma fixed charge coverage ratio (as defined in the Credit Agreement) of not less than 1.20:1.00.
Borrower is also required to pay lenders an unused commitment fee of between 0.25% and 0.45% per annum on the undrawn commitments under the Revolving Credit Facility, depending on the TNLR, quarterly in arrears. 41 The Credit Agreement also includes a requirement that the Company comply with the following financial covenants on the last day of each fiscal quarter through maturity: (i) a pro forma TNLR of not greater than 3.00:1.00 and (ii) a pro forma fixed charge coverage ratio (as defined in the Credit Agreement) of not less than 1.20:1.00.
Property tax revenues are a function of land and building prices, based on assessments of property value by state or county assessors and millage rates voted by the local electorate. • Student enrollment and delivery mechanisms for learning . Increases or decreases in the number of school bus riders have a direct impact on school district demand.
Property tax revenues are one of the major sources of funding for school districts, and therefore new school buses. Property tax revenues are a function of land and building prices, based on assessments of property value by state or county assessors and millage rates voted by the local electorate. • Student enrollment and delivery mechanisms for learning .

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThe sales bids historically have not included price escalation provisions to account for economic fluctuations between the bid date and the contract date.
Biggest changeThe Company's sales bids include price escalation provisions to mitigate the impact from economic fluctuations between the bid date and the contract date that allow us to pass along increased costs to our customers.
Commodity Risk The Company and its suppliers incorporate raw and finished commodities such as steel, copper, aluminum, and other automotive type commodities into its products. We often bid on contracts weeks or months before school buses are delivered and enter into school bus sales contracts with fixed prices per bus.
Commodity Risk The Company and its suppliers incorporate raw and finished commodities such as steel, copper, aluminum, and other automotive type commodities into our products. We often bid on contracts weeks or months before school buses are delivered and enter into school bus sales contracts with fixed prices per bus.
Based upon the balance of term loan and revolving credit facility borrowings outstanding as of September 28, 2024, a one percent change in market interest rates would increase or decrease, as applicable, annual interest expense, and ultimately cash flows from operations, by approximately $1.0 million.
Based upon the balance of term loan and revolving credit facility borrowings outstanding as of September 27, 2025, a one percent change in market interest rates would increase or decrease, as applicable, annual interest expense, and ultimately cash flows from operations, by approximately $0.9 million.
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As a result, we have historically been unable to pass along increased costs due to economic fluctuations to our customers, which is not expected to continue as the Company now includes price escalation provisions when bidding on contracts.

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