--- ticker: LW company: Lamb Weston Holdings Inc. filing_type: 10-K year_current: 2025 year_prior: 2024 risks_added: 2 risks_removed: 2 risks_modified: 9 risks_unchanged: 16 source: SEC EDGAR url: https://riskdiff.com/lw/2025-vs-2024/ markdown_url: https://riskdiff.com/lw/2025-vs-2024/index.md generated: 2026-06-01 --- # Lamb Weston Holdings Inc.: 10-K Risk Factor Changes 2025 vs 2024 > Source: U.S. Securities and Exchange Commission (EDGAR) > Generated: 2026-06-01 > All data extracted directly from official filings. No hallucinated content. ## Summary | Status | Count | |--------|-------| | New risks added | 2 | | Risks removed | 2 | | Risks modified | 9 | | Unchanged | 16 | --- ## New in Current Filing: We may not realize the anticipated cost savings and/or operating efficiencies associated with strategic initiatives, including our FY25 Restructuring Plan and recently announced Cost Savings Program. Our future success and earnings growth depend in part on our ability to achieve the appropriate cost structure and operate efficiently in the highly competitive industry. We continuously review our operations in an effort to pursue initiatives to reduce costs, increase effectiveness, and optimize cash flow. These initiatives may focus on opportunities to improve the procurement, manufacturing, and logistics within our supply chain as well as general and administrative processes. We may not realize all the anticipated cost savings or other benefits from such initiatives. Other events and circumstances, such as financial or strategic difficulties, delays, or unexpected costs, may also adversely impact our ability to realize all the anticipated cost savings or other benefits, or cause us not to realize such cost savings or other benefits on the expected timetable. If we are unable to realize the anticipated benefits, our ability to fund other initiatives may be adversely affected. Finally, the complexity of the implementation may require a substantial amount of management and operational resources to achieve the anticipated benefits of the initiatives. These and related demands on our resources may divert the organization's attention from other business issues, have adverse effects on existing business relationships with suppliers and customers, and impact employee morale. Any failure or delay in implementing these initiatives in accordance with our plans could adversely affect our business, operating efficiency, and financial results. In October 2024, we began implementing a restructuring plan (the "FY25 Restructuring Plan"), which is designed to drive operational and cost efficiencies and improve cash flows, which actions were substantially completed by the end of fiscal 2025. See Note 4, Restructuring, of the Notes to Consolidated Financial Statements in "Part II, Item 8. Financial Statements and Supplementary Data" of this Form 10-K for additional information on the plan. In addition, in July 2025, we announced a new cost savings program (the "Cost Savings Program"). If these initiatives do not achieve the expected financial impact in the aggregate or on the expected timeline, or if the benefits, even if achieved, are not adequate to meet our long-term growth and profitability expectations, our financial results and ability to meet our long-term growth expectations could be adversely impacted. 13 13 13 Table of Contents Table of Contents --- ## New in Current Filing: Impairment in the carrying value of goodwill, other intangible assets, or long-lived assets could result in the incurrence of impairment charges and negatively impact our financial results and net worth. As of May 25, 2025, we had goodwill of $1,090.2 million and other intangibles, net of $114.0 million. Additionally, we had $3,687.9 million of property, plant, and equipment, net, $113.2 million of operating right-of-use assets, and $354.6 million of other assets as of May 25, 2025. The net carrying value of goodwill represents the fair value of acquired businesses in excess of identifiable assets and liabilities as of the acquisition date (or subsequent impairment date, if applicable). The net carrying value of other intangibles represents the fair value of brands, trademarks, licensing agreements, customer relationships, and other acquired intangibles as of the acquisition date (or subsequent impairment date, if applicable), net of accumulated amortization. We perform an annual impairment assessment for goodwill, other intangible assets, and long-lived assets. In addition, we perform a similar assessment upon the occurrence of events or changes in circumstances which may indicate that the carrying amount of the assets may not be fully recoverable, measured by comparing their net book value to the undiscounted projected future cash flows generated by their use. Impairments to goodwill, other intangible assets, and long-lived assets may be caused by factors outside our control, such as increasing competitive pricing pressures, lower than expected revenue and profit growth rates, changes in industry earnings before interest, taxes, depreciation and amortization ("EBITDA") multiples, changes in discount rates based on changes in cost of capital (interest rates, etc.), or the bankruptcy of a significant customer, and could result in the incurrence of impairment charges and negatively impact our financial results and net worth. --- ## No Match in Current: If we are unable to execute on large capital projects, our business, financial condition, and results of operations could be materially and adversely affected. *This section from the 2024 filing does not have a high-confidence textual match in 2025. It may have been removed, merged, or substantially reworded.* We believe global demand for frozen potato products will continue to grow over the long-term. To support our customers' growth, we believe we must invest in our production capabilities either through capital expansion or acquisitions. In fiscal 2024, we completed the construction of a new french fry processing line in American Falls, Idaho and a new processing facility in Ulanqab, Inner Mongolia, China. We are also currently investing in new french fry processing facilities in Argentina and the Netherlands. If we are unable to complete these or other large capital projects, or encounter unexpected delays, higher costs or other challenges, including those related to supply chain disruptions and availability of necessary labor, materials, and equipment, our business, financial condition, and results of operations could be materially and adversely affected. --- ## No Match in Current: Our business relies on a potato crop that has a concentrated growing region. *This section from the 2024 filing does not have a high-confidence textual match in 2025. It may have been removed, merged, or substantially reworded.* Ideal growing conditions for the potatoes necessary for our value-added products (e.g., french fries) are concentrated in a few geographic regions globally. In the U.S., most of the potato crop used in value-added products is grown in Washington, Idaho, and Oregon. European growing regions for the necessary potatoes are concentrated in Austria, Belgium, Germany, France, the Netherlands, and the United Kingdom. Recent agronomic developments have opened new growing regions, but the capital-intensive nature of our industry's production processes has kept production highly concentrated in the historical growing regions noted above. Unfavorable crop conditions in any one region could lead to significant demand on the other regions for production, which occurred in connection with the drought in Europe during fiscal 2019. Our inability to mitigate any such conditions by leveraging our production capabilities in other regions could negatively impact our ability to meet existing customers' needs and new customer opportunities and could decrease our profitability. See also "- Legal and Regulatory Risks - Climate change, or legal, regulatory, or market measures to address climate change, may negatively affect our business and operations," in this Item 1A. Risk Factors below. --- ## Modified: Our business, financial condition, and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business and other factors related to our international operations, including foreign currency risks and trade barriers. **Key changes:** - Reworded sentence: "During each of fiscal 2025, 2024, and 2023, net sales outside the U.S., primarily in Australia, Canada, China, Europe, Japan, Korea, Mexico, and Taiwan, accounted for approximately 35%, 34%, and 23% of our net sales, respectively." - Reworded sentence: "and foreign governments, including modification or termination of existing trade agreements or treaties, creation of new trade agreements or treaties, trade regulations, and increased or new tariffs, sanctions, quotas, import or export licensing requirements, and other trade barriers imposed by governments; •changes in capital controls, including currency exchange controls, government currency policies or other limits on our ability to import raw materials or finished products into various countries or repatriate cash from outside the United States; •negative economic developments in economies around the world and the instability of governments, including the actual or threat of wars, terrorist attacks, epidemics or civil unrest, including the war in Ukraine and conflicts in the Middle East; •currency devaluations or fluctuations in currency values, including in developed and emerging markets, such as the highly inflationary environment in Argentina; •earthquakes, tsunamis, droughts, floods or other major disasters that may limit the supply of raw materials that are purchased abroad for use in our international operations or domestically; •volatile commodity prices and increased costs of raw and packaging materials, labor, energy and transportation, disruptions in shipping or reduced availability of freight transportation and warehousing, such as the reduced availability of shipping containers that we encountered in fiscal 2022; •pandemics and other public health crises, which may lead, and in the case of the COVID-19 pandemic, led, to measures that decrease revenues, disrupt our supply chain or otherwise increase our storage, production or distribution costs and adversely affect our workforce, local suppliers, customers and consumers of our products; •differing employment practices and labor standards in the international markets in which we operate; •differing levels of protection of intellectual property across the international markets in which we operate; •difficulties and costs associated with complying with U.S." - Reworded sentence: "The nature and degree of the various risks we face can differ significantly among our regions and businesses." - Added sentence: "11 11 11 Table of Contents Table of Contents" **Prior (2024):** We conduct a substantial and growing amount of business with customers located outside the U.S. During each of fiscal 2024, 2023, and 2022, net sales outside the U.S., primarily in Australia, Canada, China, Europe, Japan, Korea, Mexico, and Taiwan, accounted for approximately 34%, 23%, and 17% of our net sales, respectively. The amount for fiscal 2022 does not include any impact of unconsolidated net sales associated with LWAMSA and LW EMEA, which are also subject to risks associated with international operations. In fiscal 2023, we acquired additional equity interests in LWAMSA and LW EMEA, thereby increasing our ownership in LWAMSA and LW EMEA to 90% and 100%, respectively. We began consolidating the financial results of LWAMSA and LW EMEA in our Consolidated Financial Statements in the first quarter and fourth quarter of fiscal 2023, respectively. Factors relating to our domestic and international sales and operations, many of which are outside of our control, have had, and could continue to have, a material adverse impact on our business, financial condition, and results of operations, including: •foreign exchange rates, foreign currency exchange and transfer restrictions, which may unpredictably and adversely impact our combined operating results, asset and liability balances, and cash flow in our Consolidated Financial Statements, even if their value has not changed in their original currency; •our consolidated financial statements are presented in U.S. dollars, and we must translate the assets, liabilities, revenue and expenses into U.S. dollars for external reporting purposes; •changes in trade, monetary and fiscal policies of the U.S. and foreign governments, including modification or termination of existing trade agreements or treaties, creation of new trade agreements or treaties, trade regulations, and increased or new tariffs, sanctions, quotas, import or export licensing requirements, and other trade barriers imposed by governments. In particular, changes in U.S. trade programs and trade relations with other countries, including the imposition of trade protection measures by foreign countries in favor of their local producers of competing products, such as governmental subsidies, tax benefits, and other measures giving local producers a competitive advantage over Lamb Weston, may adversely affect our business and results of operations in those countries; •changes in capital controls, including currency exchange controls, government currency policies or other limits on our ability to import raw materials or finished products into various countries or repatriate cash from outside the United States; •negative economic developments in economies around the world and the instability of governments, including the actual or threat of wars, terrorist attacks, epidemics or civil unrest, including the war in Ukraine and conflicts in the Middle East; •currency devaluations or fluctuations in currency values, including in developed and emerging markets, such as the highly inflationary environment in Argentina; •earthquakes, tsunamis, droughts, floods or other major disasters that may limit the supply of raw materials that are purchased abroad for use in our international operations or domestically; •volatile commodity prices and increased costs of raw and packaging materials, labor, energy and transportation, disruptions in shipping or reduced availability of freight transportation and warehousing, such as the reduced availability of shipping containers that we encountered in fiscal 2022; •pandemics and other public health crises, which may lead, and in the case of the COVID-19 pandemic, have led, to measures that decrease revenues, disrupt our supply chain or otherwise increase our storage, production or distribution costs and adversely affect our workforce, local suppliers, customers and consumers of our products; •differing employment practices and labor standards in the international markets in which we operate; •differing levels of protection of intellectual property across the international markets in which we operate; •difficulties and costs associated with complying with U.S. laws and regulations applicable to entities with overseas operations, including the Foreign Corrupt Practices Act; •the threat that our operations or property could be subject to nationalization and expropriation; •varying regulatory, tax, judicial and administrative practices in the international markets in which we operate; •difficulties associated with operating under a wide variety of complex foreign laws, treaties and regulations; and •potentially burdensome taxation. 13 13 13 Table of Contents Table of Contents The nature and degree of the various risks we face can differ significantly among our regions and businesses. All these factors could result in increased costs or decreased revenues and could have an adverse effect on our business, financial condition, and results of operations. **Current (2025):** We conduct a substantial and growing amount of business with customers located outside the U.S. During each of fiscal 2025, 2024, and 2023, net sales outside the U.S., primarily in Australia, Canada, China, Europe, Japan, Korea, Mexico, and Taiwan, accounted for approximately 35%, 34%, and 23% of our net sales, respectively. Factors relating to our domestic and international sales and operations, many of which are outside of our control, have had, and could continue to have, a material adverse impact on our business, financial condition, and results of operations, including: •foreign exchange rates, foreign currency exchange and transfer restrictions, which may unpredictably and adversely impact our combined operating results, asset and liability balances, and cash flow in our Consolidated Financial Statements, even if their value has not changed in their original currency; •our consolidated financial statements are presented in U.S. dollars, and we must translate the assets, liabilities, revenue and expenses into U.S. dollars for external reporting purposes; •changes in trade, monetary and fiscal policies of the U.S. and foreign governments, including modification or termination of existing trade agreements or treaties, creation of new trade agreements or treaties, trade regulations, and increased or new tariffs, sanctions, quotas, import or export licensing requirements, and other trade barriers imposed by governments; •changes in capital controls, including currency exchange controls, government currency policies or other limits on our ability to import raw materials or finished products into various countries or repatriate cash from outside the United States; •negative economic developments in economies around the world and the instability of governments, including the actual or threat of wars, terrorist attacks, epidemics or civil unrest, including the war in Ukraine and conflicts in the Middle East; •currency devaluations or fluctuations in currency values, including in developed and emerging markets, such as the highly inflationary environment in Argentina; •earthquakes, tsunamis, droughts, floods or other major disasters that may limit the supply of raw materials that are purchased abroad for use in our international operations or domestically; •volatile commodity prices and increased costs of raw and packaging materials, labor, energy and transportation, disruptions in shipping or reduced availability of freight transportation and warehousing, such as the reduced availability of shipping containers that we encountered in fiscal 2022; •pandemics and other public health crises, which may lead, and in the case of the COVID-19 pandemic, led, to measures that decrease revenues, disrupt our supply chain or otherwise increase our storage, production or distribution costs and adversely affect our workforce, local suppliers, customers and consumers of our products; •differing employment practices and labor standards in the international markets in which we operate; •differing levels of protection of intellectual property across the international markets in which we operate; •difficulties and costs associated with complying with U.S. laws and regulations applicable to entities with overseas operations, including the Foreign Corrupt Practices Act; •the threat that our operations or property could be subject to nationalization and expropriation; •varying regulatory, tax, judicial and administrative practices in the international markets in which we operate; •difficulties associated with operating under a wide variety of complex foreign laws, treaties and regulations; and •potentially burdensome taxation. The nature and degree of the various risks we face can differ significantly among our regions and businesses. All these factors could result in increased costs or decreased revenues and could have an adverse effect on our business, financial condition, and results of operations. 11 11 11 Table of Contents Table of Contents --- ## Modified: Problems with the transition, design, or implementation of our new ERP system have and could further interfere with our business and operations and adversely affect our financial condition. **Key changes:** - Reworded sentence: "At the beginning of our third quarter of fiscal 2024, we transitioned certain central systems and functions in North America to a new enterprise resource planning ("ERP") system." - Reworded sentence: "In addition, some customers affected by these disruptions secured supply from alternative sources." - Removed sentence: "Even if we do not encounter further adverse effects, the transition, design, and implementation of a new ERP system, may be much more costly than we anticipated." **Prior (2024):** At the beginning of our third quarter of fiscal 2024, we began transitioning certain central systems and functions in North America to a new ERP system, as part of our multi-year effort to upgrade our information systems and ERP infrastructure across the company. We are designing the next phase of our ERP implementation for our manufacturing facilities in North America. The ERP system is designed to accurately maintain our financial records, enhance operational functionality, and provide timely information to our management team related to the operation of the business. The ERP system implementation process has required, and will continue to require, the investment of significant personnel and financial resources. We have experienced, and may continue to experience, difficulties as we transition to new upgraded systems and business processes. For example, after the ERP transition in our fiscal third quarter 2024, we experienced temporary reduced visibility into finished goods inventories at our distribution centers, which affected our ability to fill customer orders. Although we partnered closely with our customers to minimize the impact of the disruptions and resolved the reduced visibility, within the quarter, our sales volume and margins nevertheless declined. In addition, some customers affected by these disruptions may have secured supply from alternative sources, and we must regain their trust and business. Other difficulties may include loss of data; difficulty in completing financial reporting and filing reports with the SEC in a timely manner; or challenges in otherwise running our business. We may also experience decreases in productivity as our personnel implement and become familiar with new systems and processes. Any disruptions, delays, or deficiencies in the transition, design, and implementation of a new ERP system, particularly any disruptions, delays, or deficiencies that impact our operations, could have a material adverse effect on our business, financial condition, and results of operations. Even if we do not encounter further adverse effects, the transition, design, and implementation of a new ERP system, may be much more costly than we anticipated. **Current (2025):** At the beginning of our third quarter of fiscal 2024, we transitioned certain central systems and functions in North America to a new enterprise resource planning ("ERP") system. In fiscal 2025, we paused the next phase of our ERP implementation for our production facilities in North America. The ERP system implementation process required, and when we restart the next phase of the ERP implementation will require, the investment of significant personnel and financial resources and could be more costly than we anticipated. We have experienced, and may experience in the future, difficulties as we transition to new upgraded systems and business processes. For example, after the ERP transition in our fiscal third quarter 2024, we experienced temporary reduced visibility into finished goods inventories at our distribution centers, which affected our ability to fill customer orders. Although we partnered closely with our customers to minimize the impact of the disruptions and resolved the reduced visibility, within the quarter, our sales volume and margins nevertheless declined. In addition, some customers affected by these disruptions secured supply from alternative sources. Other difficulties may include loss of data; difficulty in completing financial reporting and filing reports with the SEC in a timely manner; or challenges in otherwise running our business. We may also experience decreases in productivity as our personnel implement and become familiar with new systems and processes. Any disruptions, delays, or deficiencies in the transition, design, and implementation of a new ERP system, particularly any disruptions, delays, or deficiencies that impact our operations, could have a material adverse effect on our business, financial condition, and results of operations. --- ## Modified: Increased competition may result in reduced sales or profits. **Key changes:** - Reworded sentence: "Some of our competitors are larger and have substantial financial, sales and marketing, and other resources." - Added sentence: "For example, in fiscal 2025, we faced significant competition as global restaurant traffic continued to soften." - Added sentence: "As a result, we increased our investments in price and trade to compete in the increasingly competitive environment in both the North America and International segments, which decreased our profits." **Prior (2024):** Our business, value-added frozen potato products, is highly competitive. Competitors include large North American and European frozen potato product companies that compete globally, local and regional companies, and retailers and foodservice distributors with their own branded and private label products. Some of our competitors are larger 16 16 16 Table of Contents Table of Contents and have substantial financial, sales and marketing, and other resources. We compete based on, among other things, customer service, value, product innovation, product quality, brand recognition and loyalty, price, and the ability to identify and satisfy customer preferences. A strong competitive response from one or more of our competitors to our marketplace efforts could result in us reducing pricing, increasing spend on promotional activity, or losing market share. Competitive pressures may restrict our ability to increase prices, including in response to commodity and other input cost increases or additional improvements in product quality. Our profits could decrease if a reduction in prices or increased costs are not counterbalanced with increased sales volume. **Current (2025):** Our business, value-added frozen potato products, is highly competitive. Competitors include large North American and European frozen potato product companies that compete globally, local and regional companies, and retailers and foodservice distributors with their own branded and private label products. Some of our competitors are larger and have substantial financial, sales and marketing, and other resources. We compete based on, among other things, customer service and support, value, product innovation, product quality, brand recognition and loyalty, price, and the ability to identify and satisfy customer preferences. A strong competitive response from one or more of our competitors to our marketplace efforts could result in us reducing pricing, increasing spend on promotional activity, or losing market share. Competitive pressures may restrict our ability to increase prices, including in response to commodity and other input cost increases or additional improvements in product quality. Our profits could decrease if a reduction in prices or increased costs are not counterbalanced with increased sales volume. For example, in fiscal 2025, we faced significant competition as global restaurant traffic continued to soften. As a result, we increased our investments in price and trade to compete in the increasingly competitive environment in both the North America and International segments, which decreased our profits. --- ## Modified: We face risks related to financial and credit market disruptions and other economic conditions. **Key changes:** - Reworded sentence: "Disruptions in financial and/or credit markets may impact our ability to manage normal commercial relationships with our customers, suppliers, and creditors and might cause us to not be able to continue to have access to preferred sources of liquidity when needed or on terms we find acceptable, and our borrowing costs could increase." - Added sentence: "17 17 17 Table of Contents Table of Contents" **Prior (2024):** Customer and consumer demand for our products may be impacted by weak economic conditions, recession, equity market volatility, or other negative economic factors in the U.S. or other countries. For example, the U.S. has experienced significantly heightened inflationary pressures since 2022. In fiscal 2024, we experienced declines in sales volume as a result of a slowdown in restaurant traffic in North America and other key international markets as our customers and consumers respond to the cumulative effect of inflation on the cost of food consumed away from home. In addition, if the restaurant traffic trends continue to soften, we may experience sales declines and may have to decrease prices, all of which could have a material adverse impact on our business, financial condition, and results of operations. Similarly, disruptions in financial and/or credit markets may impact our ability to manage normal commercial relationships with our customers, suppliers, and creditors and might cause us to not be able to continue to have access to preferred sources of liquidity when needed or on terms we find acceptable, and our borrowing costs could increase. An economic or credit crisis could occur and impair credit availability and our ability to raise capital when needed. In addition, disruptions in financial and/or credit markets could result in some of our customers experiencing a significant decline in profits and/or reduced liquidity. A significant adverse change in the financial and/or credit position of a customer could require us to assume greater credit risk relating to that customer and could limit our ability to collect receivables. A significant adverse change in the financial and/or credit position of a supplier or co-packer could result in an interruption of supply. This could have a material adverse effect on our business, financial condition, results of operations, and liquidity. A disruption in the financial markets may also have a negative effect on our derivative counterparties and could impair our banking or other business partners, on whom we rely for access to capital and as counterparties to our derivative contracts. In addition, changes in tax or interest rates in the U.S. or other countries, whether due to recession, economic disruptions, or other reasons, may adversely impact us. **Current (2025):** Disruptions in financial and/or credit markets may impact our ability to manage normal commercial relationships with our customers, suppliers, and creditors and might cause us to not be able to continue to have access to preferred sources of liquidity when needed or on terms we find acceptable, and our borrowing costs could increase. An economic or credit crisis could occur and impair credit availability and our ability to raise capital when needed. In addition, disruptions in financial and/or credit markets could result in some of our customers experiencing a significant decline in profits and/or reduced liquidity. A significant adverse change in the financial and/or credit position of a customer could require us to assume greater credit risk relating to that customer and could limit our ability to collect receivables. A significant adverse change in the financial and/or credit position of a supplier or co-packer could result in an interruption of supply. This could have a material adverse effect on our business, financial condition, results of operations, and liquidity. A disruption in the financial markets may also have a negative effect on our derivative counterparties and could impair our banking or other business partners, on whom we rely for access to capital and as counterparties to our derivative contracts. In addition, changes in tax or interest rates in the U.S. or other countries, whether due to recession, economic disruptions, or other reasons, may adversely impact us. 17 17 17 Table of Contents Table of Contents --- ## Modified: Our business is affected by potato crop performance. **Key changes:** - Added sentence: "Severe weather conditions, including protracted periods of extreme heat or cold, during the planting and growing season in our potato crop regions have in the past significantly affected, and can significantly affect, potato crop performance and our operations." - Added sentence: "For example, because of the poor quality of the crop in the Pacific Northwest that was harvested in fall 2021 following the extreme heat in the summer of 2021, we encountered lower raw potato utilization rates in our production facilities, which increased our production costs." - Added sentence: "On the other hand, too much water, such as in times of prolonged heavy rainfalls or flooding, can promote harmful crop conditions like mildew growth and increase risks of diseases, as well as delay planting or affect our ability to harvest the potatoes." - Added sentence: "For example, wet conditions in Europe delayed planting in 2024." - Added sentence: "Potatoes are also susceptible to pests and diseases that can cause crop failure, decreased yields, and negatively affect the physical appearance of the potatoes." **Prior (2024):** Our primary input is potatoes and every year, we must procure potatoes that meet the quality standards for processing into value-added products. Environmental and climate conditions, such as soil quality, moisture, and temperature, affect the yield and quality of the potato crop on a year-to-year basis. As a result, we source potatoes from specific regions of the U.S. and specific countries abroad, including Argentina, Australia, Austria, Belgium, Canada, China, France, Germany, the Netherlands, and the United Kingdom, where we believe the optimal potato growing conditions exist. However, severe weather conditions, including protracted periods of extreme heat or cold, during the planting and growing season in these regions can significantly affect potato crop performance, such as the extreme heat in the Pacific Northwest in the summer of 2021 and the drought in Europe during fiscal 2019, both of which resulted in poor crop and significantly limited supply. Further, because of the poor quality of the crop in the Pacific Northwest that was harvested in fall 2021, we encountered lower raw potato utilization rates in our production facilities during the second half of fiscal 2022 and early fiscal 2023, which increased our production costs. On the other hand, too much water, such as in times of prolonged heavy rainfalls or flooding, can promote harmful crop conditions like mildew growth and increase risks of diseases, as well as delay planting or affect our ability to harvest the potatoes. For example, wet conditions in Europe delayed planting in 2024. Potatoes are also susceptible to pest diseases and insects that can cause crop failure, decreased yields, and negatively affect the physical appearance of the potatoes. We have deep experience in agronomy and actively work to monitor the potato crop. However, if a weather or pest-related event occurs in a particular crop year, and our agronomic programs are insufficient to mitigate the impacts thereof, we may have insufficient potatoes to meet our existing customers' needs and new customer opportunities, or we may experience manufacturing inefficiencies and higher costs, and our competitiveness and profitability could decrease. Alternatively, overly favorable growing conditions can lead to high per acre yields and over-supply. An increased supply of potatoes could lead to overproduction of finished goods and associated increased storage costs or destruction of unused potatoes at a loss. For example, in fiscal 2024, we had an oversupply of potatoes, largely attributable to soft restaurant traffic trends in North America and other key international markets and a higher-than-expected impact on customer order fulfillment rates related to the ERP transition, as well as a solid potato crop in the Company's growing regions in North America, which resulted in the write-off of excess raw potatoes that adversely affected our financial results. **Current (2025):** Our primary input is potatoes and every year, we must procure potatoes that meet the quality standards for processing into value-added products. Environmental and climate conditions, such as soil quality, moisture, and temperature, affect the yield and quality of the potato crop on a year-to-year basis. Severe weather conditions, including protracted periods of extreme heat or cold, during the planting and growing season in our potato crop regions have in the past significantly affected, and can significantly affect, potato crop performance and our operations. For example, because of the poor quality of the crop in the Pacific Northwest that was harvested in fall 2021 following the extreme heat in the summer of 2021, we encountered lower raw potato utilization rates in our production facilities, which increased our production costs. On the other hand, too much water, such as in times of prolonged heavy rainfalls or flooding, can promote harmful crop conditions like mildew growth and increase risks of diseases, as well as delay planting or affect our ability to harvest the potatoes. For example, wet conditions in Europe delayed planting in 2024. Potatoes are also susceptible to pests and diseases that can cause crop failure, decreased yields, and negatively affect the physical appearance of the potatoes. If a weather or pest-related event occurs in a particular crop year, and our agronomic programs are insufficient to mitigate the impacts thereof, we may have insufficient potatoes to meet our existing customers' needs and new customer opportunities, or we may experience manufacturing inefficiencies and higher costs, and our competitiveness and profitability could decrease. Alternatively, overly favorable growing conditions can lead to high per acre yields and over-supply. An increased supply of potatoes could lead to overproduction of finished goods and associated increased storage costs or destruction of unused potatoes at a loss. For example, in fiscal 2025, we had an oversupply of potatoes, largely attributable to soft restaurant traffic trends in North America and other key international markets, which resulted in the write-off of excess raw potatoes that adversely affected our financial results. 14 14 14 Table of Contents Table of Contents In addition, ideal growing conditions for the potatoes necessary for our value-added products (e.g., french fries) are concentrated in a few geographic regions globally. As a result, we source potatoes from specific regions of the U.S. and specific countries abroad, including Argentina, Australia, Austria, Belgium, Canada, China, France, Germany, the Netherlands, and the United Kingdom, where we believe the optimal potato growing conditions exist. Unfavorable crop conditions in any one region have led at times, and could lead, to significant demand on the other regions for production. Our inability to mitigate any such conditions by leveraging our production capabilities in other regions could negatively impact our ability to meet existing customers' needs and new customer opportunities and could decrease our profitability. See also "- Legal and Regulatory Risks - Climate change, or legal, regulatory, or market measures to address climate change, may negatively affect our business and operations," in this Item 1A. Risk Factors below. --- ## Modified: We may not be able to offset cost increases on inputs necessary for the production and distribution of our products, such as labor, raw materials, energy, fuel, and packaging materials. **Key changes:** - Reworded sentence: "These commodities are subject to price volatility and fluctuations in availability caused by many factors, including: changes in global supply and demand, governmental incentives and controls (including import/export restrictions, such as new or increased tariffs, sanctions, quotas or trade barriers including the tariffs announced by the U.S." - Reworded sentence: "Our attempts to offset these cost pressures, such as through increases in the selling prices of some of our products, may not be successful or may not be sustainable." - Added sentence: "Though we provide most of our customers with local/regional supply, products we manufacture at our one production facility in Canada and import to the U.S., as well as the 5% of our inputs, primarily edible oils and natural gas, that are sourced in Canada, are currently exempt from these tariffs as they are compliant with the United States-Mexico-Canada trading agreement." - Added sentence: "Despite the current exemptions, the implementation of new tariffs on imports from Canada, Mexico, China or other countries for an extended period and without specific exemptions for our products may adversely affect our business, financial condition and results of operations." - Added sentence: "Further, any retaliatory tariffs on U.S." **Prior (2024):** A significant portion of our cost of goods comes from commodities such as raw potatoes, edible oil, grains, starches, and energy. These commodities are subject to price volatility and fluctuations in availability caused by many factors, including: changes in global supply and demand, weather conditions (including any potential effects of climate change), fire, natural disasters (such as a hurricane, tornado, earthquake, wildfire or flooding), disease or pests, agricultural uncertainty, water stress, health epidemics or pandemics or other contagious outbreaks, such as the COVID-19 pandemic, governmental incentives and controls (including import/export restrictions, such as new or increased tariffs, sanctions, quotas or trade barriers including the financial and economic sanctions imposed by the U.S. and certain foreign governments in response to the war in Ukraine), limited or sole sources of supply, inflation, political uncertainties, acts of terrorism, governmental instability, war or other conflicts (such as the war in Ukraine and conflicts in the Middle East), or currency exchange rates. During fiscal 2024, we continued to experience significantly elevated commodity and supply chain costs, including the costs of labor, raw materials (such as edible oil, grain and starch), energy, fuel, packaging materials, and other inputs necessary for the production and distribution of our products. As fiscal 2024 progressed, we experienced some moderation in input cost inflation, however, we expect modestly elevated levels of inflation to continue into fiscal 2025. Commodity price increases, or a sustained interruption or other constraints in the supply or availability of key commodities, including necessary services such as transportation and warehousing, could adversely affect our business, financial condition, and results of operations. Our attempts to offset these cost pressures, such as through increases in the selling prices of some of our products, may not continue to be successful. Higher product prices may result in reductions in sales volume. To the extent that price increases are not sufficient to offset these increased costs adequately or in a timely manner, and/or if they result in significant decreases in sales volume, our business, financial condition, or results of operations may be adversely affected. We also may not be successful in mitigating the effects of these cost increases through productivity initiatives or through our commodity hedging activity. Our future success and earnings growth depend in part on our ability to maintain the appropriate cost structure and operate efficiently in the highly competitive value-added frozen potato product category. We continue to implement profit-enhancing initiatives that improve the efficiency of our supply chain and general and administrative functions. These initiatives are focused on cost-saving opportunities in procurement, manufacturing, logistics, and customer service, as well as general and administrative functions. However, gaining additional efficiencies may become more difficult over time. In addition, there is currently no active derivatives market for potatoes in the U.S. Although we have experience in hedging against commodity price increases, these practices and experience reduce, but do not eliminate, the risk of negative profit impacts from commodity price increases. As a result, the risk management procedures that we use may not always work as we intend. To the extent we are unable to offset present and future cost increases, our business, financial condition, and results of operations could be materially and adversely affected. **Current (2025):** A significant portion of our cost of goods comes from commodities such as raw potatoes, edible oil, grains, starches, and energy. These commodities are subject to price volatility and fluctuations in availability caused by many factors, including: changes in global supply and demand, governmental incentives and controls (including import/export restrictions, such as new or increased tariffs, sanctions, quotas or trade barriers including the tariffs announced by the U.S. in April 2025 on U.S. imports, and any retaliatory tariffs imposed by foreign governments on U.S. exports, as well as selective tariff exemptions), weather conditions (including any potential effects of climate change), fire, natural disasters (such as a hurricane, tornado, earthquake, wildfire or flooding), disease or pests, agricultural uncertainty, water stress, health epidemics or pandemics or other contagious outbreaks, as was the case with the COVID-19 pandemic, limited or sole sources of supply, inflation, political uncertainties, acts of terrorism, governmental instability, war or other conflicts (such as the war in Ukraine, conflicts in the Middle East and tensions between China and Taiwan), or currency exchange rates. During fiscal 2025, we continued to experience elevated commodity and supply chain costs, including the costs of labor, raw materials (such as potatoes, edible oil, grain and starch), energy, fuel, packaging materials, and other inputs necessary for the production and distribution of our products, as well as transportation and logistics costs. Commodity price increases, or a sustained interruption or other constraints in the supply or availability of key commodities, including necessary services such as transportation and warehousing, could adversely affect our business, financial condition, and results of operations. Our attempts to offset these cost pressures, such as through increases in the selling prices of some of our products, may not be successful or may not be sustainable. Higher product prices may result in reductions in sales volume, especially given the current highly competitive frozen potato product market and soft restaurant traffic and the volatility of the macroeconomic environment. To the extent that price increases are not sufficient to offset these increased costs adequately or in a timely manner, and/or if they result in significant decreases in sales volume, our business, financial condition, or results of operations may be adversely affected. Though we provide most of our customers with local/regional supply, products we manufacture at our one production facility in Canada and import to the U.S., as well as the 5% of our inputs, primarily edible oils and natural gas, that are sourced in Canada, are currently exempt from these tariffs as they are compliant with the United States-Mexico-Canada trading agreement. Despite the current exemptions, the implementation of new tariffs on imports from Canada, Mexico, China or other countries for an extended period and without specific exemptions for our products may adversely affect our business, financial condition and results of operations. Further, any retaliatory tariffs on U.S. products by other countries, or other trade protection measures by foreign countries in favor of their local producers of competing products, such as governmental subsidies, tax benefits, and other measures giving local producers a competitive advantage over Lamb Weston, may adversely affect our business and results of operations in those countries. We also may not be successful in mitigating the effects of these cost increases through productivity initiatives or through our commodity hedging activity. Our future success and earnings growth depend in part on our ability to maintain the appropriate cost structure and operate efficiently in the highly competitive value-added frozen potato product category. We continue to implement profit-enhancing initiatives to improve the efficiency of our supply chain and general and administrative functions. These initiatives are focused on cost-saving opportunities in procurement, manufacturing, logistics, and customer service, as well as general and administrative functions. However, gaining additional efficiencies may become more difficult over time. In addition, there is currently no active derivatives market for potatoes in the U.S. Although we have experience in hedging against commodity price increases, these practices and experience reduce, but do not eliminate, the risk of negative profit impacts from commodity price increases. As a result, the risk management procedures that we use may not always work as we intend. To the extent we are unable to offset present and future cost increases, our business, financial condition, and results of operations could be materially and adversely affected. --- ## Modified: Labor shortages or stoppages, an inability to attract and retain key personnel, increased turnover or increases in labor costs could adversely affect our business, financial condition, and results of operations. **Key changes:** - Reworded sentence: "A number of factors may adversely affect the available labor force, or increase labor costs, for us or our third-party business partners, including hybrid or remote work arrangements, higher unemployment subsidies, other government regulations, and general macroeconomic factors." - Reworded sentence: "Further, our success depends on our ability to attract, retain, and develop effective leaders and personnel with professional and technical expertise, such as agricultural and food manufacturing experience or emerging technologies experience, as well as finance, marketing, and other senior management professionals." - Reworded sentence: "In addition, changes in immigration laws and policies or restrictions could make it more difficult for us to recruit or relocate skilled employees." - Removed sentence: "Similarly, we have been negatively impacted and may in the future continue to be negatively impacted by labor shortages or increased labor costs experienced by our third-party business partners, including our logistics providers, suppliers, and customers." - Removed sentence: "For example, reduced availability of trucking capacity due to shortages of drivers, primarily as a result of the COVID-19 pandemic, caused an increase in the cost of transportation for us and our suppliers in fiscal 2022." **Prior (2024):** Labor is a primary component of operating our business. A number of factors may adversely affect the labor force available to us or increase labor costs, including the shift towards hybrid or remote work arrangements, higher unemployment subsidies, other government regulations, and general macroeconomic factors. The labor market has been increasingly tight and competitive, and we may face sudden and unforeseen challenges in the availability of labor, such as we experienced in fiscal 2022 and 2023 at some of our production facilities, which reduced our production run-rates and increased our manufacturing costs. As we experienced with the COVID-19 pandemic, sustained labor shortages or increased turnover rates within our workforce, could lead to production or shipping delays, increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees, and could negatively affect our ability to efficiently operate our production and distribution facilities and overall business. Further, our success depends on our ability to attract, retain, and develop effective leaders and personnel with professional and technical expertise, such as agricultural and food manufacturing experience, as well as finance, marketing, and other senior management professionals. The loss of the services of these persons could deplete our institutional knowledge and could have a material adverse effect on our business, financial condition, and results of operations. The market for these employees is competitive, and we could experience difficulty from time to time in hiring and retaining the personnel necessary to support our business. Our ability to recruit and retain a highly skilled workforce could also be materially impacted if we fail to adequately respond to rapidly changing employee expectations regarding fair compensation, an inclusive and diverse workplace, flexible working, or other matters. If we are unable to hire and retain employees capable of performing at a high-level, develop adequate training and succession plans for leadership positions, or if mitigation measures we may take to respond to a decrease in labor availability, such as overtime and third-party outsourcing, have unintended negative effects, our business could be adversely affected. Similarly, we have been negatively impacted and may in the future continue to be negatively impacted by labor shortages or increased labor costs experienced by our third-party business partners, including our logistics providers, suppliers, and customers. For example, reduced availability of trucking capacity due to shortages of drivers, primarily as a result of the COVID-19 pandemic, caused an increase in the cost of transportation for us and our suppliers in fiscal 2022. An overall labor shortage, lack of skilled labor, increased turnover, or labor inflation could have a material adverse impact on our business, financial condition, and results of operations. In addition, health care and workers' compensation costs have been increasing. Inflationary pressures and any shortages in the labor market could continue to increase labor costs, which could have a material adverse effect on our business, financial condition, or results of operations. Our labor costs include the cost of providing employee benefits in the U.S. and foreign jurisdictions, including pension, health and welfare, and severance benefits. Changes in interest rates, mortality rates, health care costs, early retirement rates, investment returns, and the market value of plan assets can affect the funded status of our defined benefit plans and cause volatility in the future funding requirements of the plans. A significant increase in our obligations or future funding requirements could have a negative impact on our results of operations and cash flows from operations. Additionally, the annual costs of benefits vary with increased costs of health care and the outcome of collectively bargained wage and benefit agreements. Furthermore, we may be subject to increased costs or experience adverse effects on our operating results if we are unable to renew collectively bargained agreements on satisfactory terms as they expire. Our financial condition and ability to meet the needs of our customers could be materially and adversely affected if strikes or work stoppages or interruptions occur as a result of delayed negotiations with union-represented employees within or outside the U.S. **Current (2025):** Labor is a primary component of operating our business. A number of factors may adversely affect the available labor force, or increase labor costs, for us or our third-party business partners, including hybrid or remote work arrangements, higher unemployment subsidies, other government regulations, and general macroeconomic factors. The labor market has been increasingly tight and competitive, and we may face sudden and unforeseen challenges in the availability of labor, such as we experienced in fiscal 2022 and 2023 at some of our production facilities, which reduced our production run-rates and increased our manufacturing costs, or as we and our suppliers experienced in 2022 with the shortage of drivers and reduced trucking capacity, which increased transportation costs. As we experienced with the COVID-19 pandemic, sustained labor shortages or increased turnover rates within our workforce, could lead to production or shipping delays, increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees, and could negatively affect our ability to efficiently operate our production and distribution facilities and overall business. Further, our success depends on our ability to attract, retain, and develop effective leaders and personnel with professional and technical expertise, such as agricultural and food manufacturing experience or emerging technologies experience, as well as finance, marketing, and other senior management professionals. The loss of the services of these persons could deplete our institutional knowledge and could have a material adverse effect on our business, financial condition, and results of operations. The market for these employees is competitive, and we could experience difficulty from time to time in hiring and retaining the personnel necessary to support our business. In addition, changes in immigration laws and policies or restrictions could make it more difficult for us to recruit or relocate skilled employees. Our ability to recruit and retain a highly skilled workforce could also be materially impacted if we fail to adequately respond to rapidly changing employee expectations regarding fair compensation, an inclusive workplace, flexible working, or other matters. If we are unable to hire and retain employees capable of performing at a high-level, develop adequate training and succession plans for leadership positions, or if mitigation measures we may take to respond to a decrease in labor availability, such as overtime and third-party outsourcing, have unintended negative effects, our business could be adversely affected. In addition, health care and workers' compensation costs have been increasing. Inflationary pressures and any shortages in the labor market could continue to increase labor costs, which could have a material adverse effect on our business, financial condition, or results of operations. Our labor costs include the cost of providing employee benefits in the U.S. and foreign jurisdictions, including pension, health and welfare and severance benefits. We are in the process of terminating our pension plan for certain of our U.S. employees. The termination and settlement process preserves retirement benefits due to participants but changes the ultimate payor of such benefits. During fiscal 2026, we expect to complete the purchase of group annuity contracts that will transfer any remaining pension benefit obligation to an insurance company. The final pension settlement charges and the actual amount we will be required to contribute to the plan is dependent on various factors, including the value of plan assets, distributions paid to plan participants, and the cost to purchase annuity contracts to settle the pension obligation. Additionally, the annual costs of benefits vary with increased costs of health care and the outcome of collectively bargained wage and benefit agreements. A significant increase in our obligations could have a negative impact on our results of operations and cash flows from operations. In addition, our financial condition and ability to meet the needs of our customers could be materially and adversely affected if strikes or work stoppages or interruptions occur as a result of delayed negotiations with union-represented employees within or outside the U.S, or if we are unable to renew collectively bargained agreements on satisfactory terms as they expire. As discussed above, most of the union workers at our facilities are represented under contracts that expire at various times over the next several years. Of the hourly employees who are represented by these contracts, 65% are party to a collective 10 10 10 Table of Contents Table of Contents bargaining agreement currently in negotiations or scheduled to expire over the course of the next twelve months. As the agreements expire and are renegotiated, there is no guarantee that they will be renewed in a timely manner or on satisfactory terms. --- ## Modified: If we are unable to execute on large capital projects or complete or realize the projected benefits of acquisitions, divestitures and other strategic transactions, our business, financial condition, and results of operations could be materially and adversely affected. **Key changes:** - Reworded sentence: "To support growth, we have invested in our production capabilities either through capital expansion or acquisitions, and are currently investing in a new processing facility in Argentina." - Reworded sentence: "If we are unable to complete or realize the projected benefits of recent or future acquisitions, divestitures or other strategic transactions, our business, financial condition, and results of operations may be adversely impacted." **Prior (2024):** Our ability to meet our objectives with respect to acquisitions and other strategic transactions may depend in part on our ability to identify suitable counterparties, negotiate favorable financial and other contractual terms, obtain all necessary regulatory approvals on the terms expected and complete those transactions. Potential risks also include: •the inability to integrate acquired businesses into our existing operations in a timely and cost-efficient manner; •diversion of management's attention from other business concerns; •potential loss of key employees, suppliers and/or customers of acquired businesses; •assumption of unknown risks and liabilities; •the inability to achieve anticipated benefits, including revenues or other operating results; •operating costs of acquired businesses may be greater than expected; •difficulties integrating personnel and financial and other systems; •inaccurate estimates of fair value made in the accounting for acquisitions and amortization of acquired intangible assets, which would reduce future reported earnings; •indemnities and potential disputes with the sellers; and •the inability to promptly implement an effective control environment. If we are unable to complete or realize the projected benefits of recent or future acquisitions, divestitures or other strategic transactions, our business or financial results may be adversely impacted. 15 15 15 Table of Contents Table of Contents **Current (2025):** To support growth, we have invested in our production capabilities either through capital expansion or acquisitions, and are currently investing in a new processing facility in Argentina. If we are unable to complete this or other large capital projects, or encounter unexpected delays, higher costs or other challenges, including those related to supply chain disruptions and availability of necessary labor, materials, and equipment, our business, financial condition, and results of operations could be materially and adversely affected. In addition, our ability to meet our objectives with respect to acquisitions and other strategic transactions may depend in part on our ability to identify suitable counterparties, negotiate favorable financial and other contractual terms, obtain all necessary regulatory approvals on the terms expected and complete those transactions. Potential risks also include: •the inability to integrate acquired businesses into our existing operations in a timely and cost-efficient manner; •diversion of management's attention from other business concerns; •potential loss of key employees, suppliers and/or customers of acquired businesses; •assumption of unknown risks and liabilities; •the inability to achieve anticipated benefits, including revenues or other operating results; •operating costs of acquired businesses may be greater than expected; •difficulties integrating personnel and financial and other systems; •inaccurate estimates of fair value made in the accounting for acquisitions and amortization of acquired intangible assets, which would reduce future reported earnings; •indemnities and potential disputes with the sellers; and •the inability to promptly implement an effective control environment. If we are unable to complete or realize the projected benefits of recent or future acquisitions, divestitures or other strategic transactions, our business, financial condition, and results of operations may be adversely impacted. --- ## Modified: An imbalance of industry supply and demand may result in reduced sales or profits. **Key changes:** - Reworded sentence: "Customer and consumer demand for our products may be impacted by weak economic conditions, recession, equity market volatility, or other negative economic factors in the U.S." - Added sentence: "15 15 15 Table of Contents Table of Contents" **Prior (2024):** In recent years, market demand for value-added frozen potato products has exceeded industry capacity to produce these products. However, in fiscal 2024, we experienced declines in sales volume as a result of a slowdown in restaurant traffic in North America and other key international markets as our customers and consumers respond to the cumulative effect of inflation on the cost of food consumed away from home. As additional industry capacity comes online, restaurant traffic declines, or market demand otherwise decreases, including as a result of inflation or pandemics such as the COVID-19 pandemic or other contagious outbreaks, we may face competitive pressures that would restrict our ability to increase or maintain prices, or we may lose market share. For example, during fiscal 2024, we have faced increased pricing pressure as additional industry capacity becomes operational, which capacity is also impacted by softening demand. Our profits would decrease as a result of a reduction in prices or sales volume. **Current (2025):** Customer and consumer demand for our products may be impacted by weak economic conditions, recession, equity market volatility, or other negative economic factors in the U.S. or other countries. For example, the U.S. has experienced significantly heightened inflationary pressures since 2022. Historically, market demand for value-added frozen potato products has generally been balanced with industry capacity. However, in fiscal 2024 and continuing in fiscal 2025, we experienced declines in sales volume as a result of a slowdown in restaurant traffic in North America and other key international markets as our customers and consumers respond to the cumulative effect of inflation on the cost of food consumed away from home. In addition, if the restaurant traffic trends continue to soften, we may experience sales declines and may have to decrease prices, all of which could have a material adverse impact on our business, financial condition, and results of operations. In fiscal 2025, we invested in price and trade support to compete in the increasingly competitive environment in both North America and other international markets, though there is no guarantee that such support will be sufficient. As additional industry capacity comes online, restaurant traffic declines, or market demand otherwise decreases, including as a result of inflation, we may face competitive pressures that would restrict our ability to increase or maintain prices, or we may lose market share. For example, during fiscal 2025, we have faced increased pricing pressure as additional industry capacity becomes operational, which capacity is also impacted by softening demand. Our profits would decrease as a result of a reduction in prices or sales volume. 15 15 15 Table of Contents Table of Contents --- *Data sourced from SEC EDGAR. Last updated 2026-06-01.*