Key Highlights

● Fox Factory said CEO Mike Dennison is departing and named Douglas Grimm interim chief executive.

● Fiscal 2026 net sales guidance was lowered to $1.35 billion–$1.38 billion.

● Adjusted EBITDA guidance fell to $140 million–$150 million from $176 million–$196 million.

● Preliminary third-quarter sales came to $336 million–$340 million.

Two pieces of news at once

Fox Factory Holding (NASDAQ:FOXF) said CEO Mike Dennison is departing and named Douglas Grimm as interim chief executive, according to market reports. One report described the departure as unplanned. The leadership change was reported alongside the company's revised outlook.

At the same time, Fox Factory cut its guidance. The company now expects fiscal 2026 net sales of $1.35 billion to $1.38 billion, down from a prior range of $1.42 billion to $1.47 billion, and adjusted EBITDA of $140 million to $150 million, down from $176 million to $196 million, according to market reports.

The S&P SmallCap 600 member plunged on the news, though reports differed on the size of the move at different points in the day. One report described a steep drop before the opening bell, and another reported a sharp decline by mid-morning.

The numbers behind the cut

Fox Factory gave preliminary third-quarter figures, with sales of $336 million to $340 million and adjusted EBITDA of $38 million to $42 million. A separate report noted that the third-quarter revenue range compares with prior guidance of $355 million to $380 million.

The fourth-quarter outlook fell well short of Wall Street's expectations. The company guided to revenue of $287 million to $313 million, against a consensus estimate of $348.5 million.

Fox Factory, based in Duluth, Georgia, designs and manufactures ride-dynamics products, including shocks and suspension systems for mountain bikes, powersports vehicles and pickup trucks, along with aftermarket upgrade packages. Its business is tied to spending on recreational and performance vehicles, as well as to orders from the bike and vehicle makers it supplies.

A difficult backdrop for consumer names

The announcement arrived on a weak day for consumer-facing stocks. The LSEG/Ipsos Primary Consumer Sentiment Index fell 5.3 points to 45.2, its lowest since October 2011. Consumer discretionary shares slipped in the final hour, and gasoline averaged $4.33 a gallon, up from $3.06 a year earlier.

The broader market fell. The S&P 500 lost 84.62 points to 7,659.44, the Nasdaq Composite dropped 572.99 points to 26,140.03 and the Dow Jones Industrial Average slipped 175.28 points to 52,002.41. The Russell 2000 fell 45.90 points to about 2,721. No closing level for the S&P SmallCap 600 was available. Technology stocks led the declines, while energy, utilities and consumer staples gained.

The 10-year Treasury yield eased to roughly 5.1, after topping 5.3 earlier in October, its highest since 2002. Higher borrowing costs matter for buyers who finance big-ticket recreational purchases.

Fox Factory Awaits Transition Details

Consumer data next week include the University of Michigan sentiment survey on Oct 23. Results from automakers and suppliers, including General Motors (NYSE:GM) on Tuesday, Oct 20, and Genuine Parts (NYSE:GPC) the same day, could give additional context on vehicle demand. The Federal Reserve announces its next decision on Oct 28. Fed Chair Kevin Warsh said, "I don't prejudge meetings," at an IMF gathering in Bangkok.

Investors will be looking for more information on the leadership transition, including any further announcements from the company, and for fuller detail on the drivers of the lower outlook when Fox Factory releases complete third-quarter results.