Fox Factory Holding Shares Plummet

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Shares of Fox Factory Holding plummeted more than a quarter in value following a soft forecast from the company, known for producing components and systems for bike manufacturers, commercial trucks, and more.

Challenges and Slowdowns

The stock fell 26% to $48.01 in premarket trading, adding to a year-long decline of about 47%. Fox Factory, headquartered in Duluth, Ga., cited weak demand for new bikes as a key factor in their disappointing financial outlook.

Struggles and Projections

The company’s sales and earnings forecast for the year fell short of Wall Street expectations, reflecting ongoing struggles such as reduced bike manufacturer demand and repercussions from previous auto worker strikes. Additionally, interest rate hikes have dampened powersports vehicle demand, impacting Fox Factory’s customer base.

Near-Term Concerns and Bright Spots

CEO Mike Dennison acknowledged that challenges, especially within the bike business, may worsen in the first half of the year before showing signs of recovery in the second half. Despite this, Dennison assured that the company remains focused on overcoming these hurdles without resorting to large layoffs or drastic budget cuts in marketing and research. Amidst the difficulties, Fox Factory’s aftermarket parts division has experienced growth as more vehicle owners opt to delay purchasing new vehicles.

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