LW 10-K & 10-Q changes, risk factors and insider trading

A significant portion of our costinput of goodscosts 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 and surcharges announced by the U.S. in Aprilthroughout 2025 and 2026 on U.S. imports, and anycorresponding 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 andEast, tensions between China and Taiwan and recent geopolitical developments in Venezuela), 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 theseU.S. tariffs as they are compliant with the United States-Mexico-CanadaU.S.-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 or the termination of the U.S.-Mexico-Canada trading agreement 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.

WeOur alsoattempts mayto not be successful in mitigating the effects ofoffset these cost pressures, such as through increases throughin the selling prices of some of our products, productivity initiatives or through our commodity hedging activity.activity, may not be successful or sustainable. 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. Higher product prices may result in reductions in sales volume, especially given the current highly competitive frozen potato product market and soft restaurant traffic, most notably in Europe, and the volatility of the macroeconomic environment. If we are unable to increase prices, or if 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 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.U.S or Europe. 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.

Our ability to manufacture or sell our products may be impaired by damage or disruption to our manufacturing, warehousing or distribution capabilities, or to the capabilities of our suppliers, logistics service providers, or independent distributors. This damage or disruption could result from execution issues, as well as factors that are difficult to predict or beyond our control such as increased temperatures due to climate change, water stress, extreme weather events, natural disasters, product or raw material scarcity, fire, terrorism, pandemics, armed hostilities (including the ongoing war in Ukraine and conflicts in the Middle East), blockades, strikes, labor shortages, cybersecurity breaches, governmental restrictions or mandates, disruptions in logistics, supplier capacity constraints, or other events. Failure to take adequate steps to mitigate the likelihood or potential impact of such events, or to effectively manage such events if they occur, may adversely affect our business, financial condition, and results of operations. Further, the inability of any supplier, including, but not limited to, those that supply our packaging, ingredients, equipment and other necessary operating materials, co-manufacturer, independent contractor, logistics service provider, or independent distributor to deliver or perform for us in a timely or cost-effective manner could cause our operating costs to increase and our profit margins to decrease. We have experienced, and may continue to experience, disruptions in our supply chain, including as a result of temporary systems disruptions, labor shortages, increased transportation and warehousing costs, longer shipping times, pandemics or other public health crisis, the ongoing war in Ukraine and conflicts in the Middle East. As discussed above, since late February 2026, the conflicts in the Middle East.East have caused and may continue to cause disruptions to shipping routes and increased volatility in global commodity and transportation markets. The occurrence of a significant supply chain disruption or the inability to access or deliver products that meet requisite quality and safety standards in a timely and efficient manner, could lead to increased warehouse and other storage costs or otherwise adversely affect our profitability and weaken our competitive position or harm our business.

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 withduring thethose COVID-19 pandemic,years, sustained labor shortages or increased turnover rates within our workforce,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 or advanced 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%74% are party to a collective 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.

We conduct a substantial and growing amount of business with customers located outside the U.S. During each of fiscal 2026, 2025, 2024, and 2023,2024, net sales outside the U.S., primarily in Australia, Canada, China, Europe, Japan, Korea, Mexico, and Taiwan, accounted for approximately 35%, 34%,35%, and 23%34% 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:

•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 StatesU.S.;

•pandemics and other public health crises, which may lead, and in the case of the COVID-19 pandemic, led,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;

There can be no assurance that our customers will continue to purchase our products in the same quantities or on the same terms as in the past. The loss of a significant customer or a material reduction in sales to a significant customer could materially and adversely affect our business, financial condition, and results of operations. In addition, the financial condition of our significant customers, including restaurants, distributors and retailers, are affected by events that are largely beyond our control, such as the impacts of past and possible future pandemics or other contagious outbreaks, and political or military conflicts, such as the war in Ukraine or conflicts in the Middle East.control. Deterioration in the financial condition of significant customers could materially and adversely affect our business, financial condition, and results of operations.

To serve our customers globally, we rely primarily on our international operations, but also in part on exports from the U.S. During fiscal 2026, 2025, 2024, and 2023,2024, export sales from the U.S. accounted for approximately 6%, 6% and 11%, respectively, of our total net sales.sales in each year. Circumstances beyond our control, such as retaliatory non-U.S. tariffs countermeasures, a labor dispute at a port, limited shipping container availability or workforce disruptionsdisruptions, (suchhave as disruptions that occurred during the COVID-19 pandemic),and could prevent us from exporting our products in sufficient quantities to meet certain customer opportunities. For example, during the latter half of fiscal 2022, limited shipping container availability along the U.S. West Coast and disruptions to ocean freight networks across the Pacific Ocean resulted in lower export volumes in our International segment. We have access to production outside of the U.S. through our facilities in Argentina, Australia, Austria, Canada, China, the Netherlands, and the United Kingdom, but we may be unsuccessful in mitigating any future disruption to export mechanisms. Our operations outside of the U.S. are also subject to export mechanisms in their regions and as such, are impacted by similar factors, including political or military conflicts, such as conflicts in the Middle East. For example, with the blockade of the Strait of Hormuz, we have experienced an increase in traffic at another key port of entry in the Middle East, resulting in higher costs and longer transit times. If thisdisruptions occurs,to our access to export mechanisms occur or continue for an extended period of time, we may be unable to adequately supply all our existing customers’ needs and new customer opportunities, which could adversely affect our business, financial condition, and results of operations.

Our reputation could also be adversely impacted by any of the following, or by adverse publicity (whether or not valid) relating thereto: the failure to maintain high ethical, social, and environmental standards for our operations and activities, including the health, safety, and security of our employees and our supply chain; our research and development efforts; our environmental impact, including use of agricultural materials, packaging, energy and water use, and waste management, and the failure to set certain goals, or to achieve any stated goals, with respect to such matters; our failure to comply with local laws and regulations; our failure to maintain an effective system of internal controls; or our failure to provide accurate and timely financial information. If we do not successfully manage ESG-relatedsustainability-related expectations across stakeholders, which evolve and are at times conflicting, it could erode stakeholder trust, impact our reputation and adversely affect our business. Moreover, the growing use of social and digital media and shopping, health or product evaluation applications by consumers and other stakeholders has greatly increased the speed and extent that information or misinformation and opinions can be shared. Negative or inaccurate posts or comments about us, our brands, or our products on social or digital media or inaccurate information contained in shopping, health or product evaluation applications which may use outputs derived from artificial intelligence applications could damage our reputation and our brands. Damage to our reputation or loss of customer confidence in our products for any of these or other reasons could result in decreased demand for our products and could have a material adverse effect on our business, financial condition, and results of operations, as well as require additional resources to rebuild our reputation.

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.acquisitions. 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.

Our business is affected by potato crop harvest quality and performance.

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. ForExtreme example,heat becausehas ofled, theand can lead, to poor quality of the crop inquality, the Pacific Northwest that was harvestedresulting in fall 2021 following the extreme heat in the summer of 2021, we encountered lower raw potato utilization rates in our production facilities,rates, which increased ourincrease production costs. On the other hand, too much water, such as in times of prolonged heavy rainfalls or flooding, has and 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, most recently in fiscal 2025,2026, we had an oversupply of potatoes, largely attributable to continued soft restaurant traffic trends in NorthEurope, Americaas well as significant surplus in the European potato market due to expanded potato acreage and othera keyrobust internationalcrop markets,of potatoes during the last growing season, which resulted in the write-off of excess raw potatoes that adversely affected our financial results.

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.

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. Furthermore, we may experience price pressure due to competitors’ promotional activity and pricing, which may be particularly strong during adverse economic periods and periods of high inflation. 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 2025,2026, we facedcontinued to face significant competition as global restaurant traffic continuedremained tosoft, soften.most As a result, we increased our investmentsnotably in price and trade to compete in the increasingly competitive environment in both the North America and International segments, which decreased our profits.Europe.

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 fiscalrecent 2024 and continuing in fiscal 2025,years, we have experienced declines in sales volume as a result of a slowdown in restaurant traffic in North AmericaAmerica, Europe, 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 2025,2026, 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 2025,2026, we have faced increased pricing pressure as additionalour industryinternational capacityoperations becomeswere operational,challenged by an increasingly competitive market environment resulting from a significant surplus in the European potato market; local sourcing in developing regions such as the Middle East, China and India, which capacityaffected isexports alsofrom impactedEurope byto softeningthose demand.markets; Ourand profitspersistently wouldlower decreaserestaurant as a result of a reductiontraffic in priceskey or sales volume.countries.

Consumer preferences evolvecontinuously over timeevolve, and our success depends on our ability to identify the priorities, tastes and dietary habits of consumers and offer products that appeal to those preferences. We need to continue to respond to these changing consumer preferences and support our customers in their efforts to evolve to meet those preferences. For example, as consumers continue to focus on freshly prepared foods and away from processed foods, some restaurants may choose to limit the frying capabilities of their kitchens. As a result, we must evolve our product offering to provide alternatives that work in such a preparation environment. In addition, our products may contain carbohydrates, sodium, genetically modified ingredients, added sugars, saturated fats, and preservatives, the diet and health effects of which remain the subject of public scrutiny. For example, the increased use and/or prevalence of certain weight loss drugs, which may suppress a person’s appetite and/or impact a person’s preferences, may impact the demand or consumption patterns for certain of our products. In addition, consumers have increasingly been focused on well-being including reducing sodium and trans fatsfats, seed oils, and added sugar consumption, as well as the source and authenticity of ingredients in the foods they consume. Efforts to reformulate our products, introduce new products and create product extensions require significant research and development and marketing investments. If our products fail to meet consumer preferences or customer requirements, or we fail to introduce new and improved products on a timely basis, then the return on those investments will be less than anticipated, which could materially and adversely affect our business, financial condition, and results of operations.

In addition, we compete against branded products as well as private label products. Our products must provide higher value and/or quality to our customers and consumers than alternatives, particularly during periods of economic uncertainty. Consumers may not buy our products if relative differences in value and/or quality between our products and private label products change in favor of competitors’ products or if consumers perceive this type of change. If consumers prefer private label products, which are typically sold at lower prices, then we could lose market share or sales volumes or shift our product mix to lower margin offerings. During anAn economic downturn, some of the effects of which are present in our current environment, factors such as increased unemployment, decreases in disposable income, inflation, and declines in consumer confidence could cause a decrease in demand for our overall product offerings, particularly higher priced products, which could materially and adversely affect our business, financial condition, and results of operations. Distributors, restaurants, and retailers may also become more conservative in response to these conditions and seek to reduce their inventories. A change in consumer preferences could also cause us to increase capital, marketing, and other expenditures, which could materially and adversely affect our business, financial condition, and results of operations.

In addition, the restrictive covenants in our credit agreements require us to maintain specified financial ratios and satisfy other financial condition tests. We cannot provide assurance that we will continue to be in compliance with these ratios and tests. Our ability to continue to meet those financial ratios and tests will depend on our ongoing financial and operating performance, which, in turn, will be subject to economic conditions and to financial, market, and competitive factors, many of which are beyond our control. A breach of any of these covenants could result in a default under one or more of our debt instruments, including as a result of cross default provisions and, in the case of our revolving credit facility, permit the lenders thereunder to cease making loans to us. Upon the occurrence of an event of default under our credit facilities, the lenders could elect to declare all amounts outstanding thereunder to be immediately due and payable and terminate all commitments to extend further credit. Such action by the lenders could cause cross-defaults under our senior notes indentures.

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.

As of May 25,31, 2025,2026, we had goodwill of $1,090.2$1,130.1 million and other intangibles, net of $114.0$108.3 million. Additionally, we had $3,687.9$3,690.0 million of property, plant, and equipment, net, $113.2$111.6 million of operating right-of-use assets, and $354.6$325.7 million of other assets as of May 25, 2025.assets. 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 fair value of the assets for goodwill and other intangible assets and their net book value to the undiscounted projected future cash flows generated by their use.use for other long-lived assets. 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.

We rely on information technology networks and systems, including the Internet, to process, transmit, and store electronic and financial information, to manage and support a variety of business processes and activities, and to comply with regulatory, legal, and tax requirements. We also depend upon our information technology infrastructure for digital marketing activities and for electronic communications among our locations, personnel, customers, third-party manufacturers and suppliers. The importance of such networks and systems has increased due to our adoption of flexible work-from-home policies for some of our functional support areas, which in turn has heightened our vulnerability to cyberattacks or other disruptions. Despite careful security and controls design, implementation and updating, monitoring and routine testing, independent third-party verification, and annual training of employees on information security and data protection, our information technology systems, some of which are dependent on services provided by third parties, may be vulnerable to, among other things, damage, invasions, disruptions, or shutdowns due to any number of causes such as catastrophic events, natural disasters, infectious disease outbreaks and other public health crises, fires, power outages, systems failures, telecommunications failures, security breaches, computer viruses, ransomware and malware, hackers, employee error or malfeasance, potential failures in the incorporation of artificial intelligence, employee or personnel failures and other causes. While we have experienced threats to our data and systems, to date, we are not aware that we have experienced a breach that had a material impact on our operations or business. However, third parties, including our partners and vendors, could also be a source of security risk to us, and have or causecould have disruptions to our normal operations, in the event of a breach of their own products, components, networks, security systems, and infrastructure. For example, in April 2023, Americold Realty Trust, Inc., a third-party finished goods storage provider, suffered a cyber incident that impacted its operations and resulted in considerable delays in the delivery of our products to our customers and interrupted other key business processes. While the incident impacted our business and we were unable to ship to certain customers for a short period of time, it did not have a material adverse impact on our business.

Cyber threats are constantly evolving, are becoming more frequent and more sophisticated and are being made by groups of individuals with a wide range of expertise and motives, which increases the difficulty of detecting and successfully defending against them. Continued geopolitical turmoil and geopolitical tensions, such as between the U.S. and China,China and the U.S. and Iran, have heightened the risk of cyberattacks. Sophisticated cybersecurity threats, including potential cyberattacks from China, Russia or other state actors targeted against the U.S., pose a potential risk to the security and viability of our information technology systems, as well as the confidentiality, integrity, and availability of the data stored on those systems, including cloud-based platforms.systems. In addition, new technology, such as artificial intelligence, that could result in greater operational efficiency may further expose our computer systems to the risk of cyberattacks. Our initiatives to continue to modernize our operations, increase data digitization and improve our production facilities may increase potential exposure to cybersecurity risks and increase the complexity of our cybersecurity program. We anticipate that the risk of cybersecurity attacks will increase as artificial intelligence is increasingly used to identify vulnerabilities and conduct increasingly sophisticated attacks. If we do not allocate and effectively manage the resources necessary to build and sustain the proper technology infrastructure and associated automated and manual control processes, we could be subject to billing and collection errors, business disruptions, or damage resulting from security breaches. If any of our significant information technology systems suffer severe damage, disruption, or shutdown and our business continuity plans do not effectively resolve the issues in a timely manner, our product sales, financial condition, and results of operations may be materially and adversely affected, and we could experience delays in reporting our financial results. Any interruption of our information technology systems or those of our suppliers and customers could have operational, reputational, legal, and financial impacts that may have a material adverse effect on our business, financial condition, and results of operations.

We sell food products for human consumption, which involves risks such as product contamination or spoilage, product tampering, other adulteration of food products, mislabeling, and misbranding. We may voluntarily recall or withdraw products from the market in certain circumstances, which would cause us to incur associated costs; those costs could be meaningful. For example, in June 2024, we had a voluntary product withdrawal, which negatively impacted our financial results. We may also be subject to litigation, requests for indemnification from our customers, or liability if the consumption or inadequate preparation of any of our products causes injury, illness, or death. A significant product liability judgment or a widespread product recall or withdrawal may negatively impact our sales and profitability for a period of time depending on the costs of the recall or withdrawal, the destruction of product inventory, product availability, competitive reaction, customer reaction, and consumer attitudes. Even if a product liability or labeling claim is unsuccessful or is not fully pursued, the negative publicity surrounding any such assertion that our products caused illness or injury could adversely affect our reputation with existing and potential customers and our corporate and brand image. Our business could also be adversely affected if consumers lose confidence in the food safety system generally, even if such loss of confidence is unrelated to products in our portfolio.

In addition, we could be the target of claims of false or deceptive advertising under U.S. federal and state laws as well as foreign laws, including consumer protection statutes of some states. The marketing of food products has come under increased regulatory scrutiny in recent years, and the food industry has been subject to an increasing number of proceedings and claims relating to alleged false or deceptive labeling and marketing under federal, state and foreign laws or regulations.regulations, including those alleging noncompliance with food ingredient and packaging requirements. Changes in legal or regulatory requirements (such as new food safety requirements, revised or new nutrition facts or allergen labeling, including front of pack labeling, serving size regulations and bans on certain food ingredients or packaging materials), or evolving interpretations of existing legal or regulatory requirements, may result in increased compliance costs, capital expenditures and other financial obligations that could adversely affect our business or financial results. If we are found to be out of compliance with applicable laws and regulations in these areas, we could be subject to civil remedies, including fines, injunctions, termination of necessary licenses or permits, or recalls or withdrawals, as well as potential criminal sanctions, any of which could have a material adverse effect on our business.

Additionally, asAs a manufacturer and marketer of food products, we are subject to extensive regulation by the FDA and other national, state and local governmentgovernmental agencies. The Food, Drug & Cosmetic Act, the Food Safety Modernization Act, other laws and their respective regulations govern, among other things, the manufacturing, composition and ingredients, packaging, and safety of food products. Some aspects of these laws use a strict liability standard for imposing sanctions on corporate behavior, meaning that no intent is required to be established. If we fail to comply with applicable laws and regulations, we may be subject to civil remedies, including fines, injunctions, recalls, withdrawals, or seizures, as well as criminal sanctions, any of which could have a material adverse effect on our business, financial condition, and results of operations.

The regulation of food products, both within the U.S. and internationally, continues to be a focus for governmental scrutiny. The presence and/or formation of acrylamide in potato products cooked at high temperatures has become a global regulatory issue as both the FDA and the European Food Safety Authority (‘‘EFSA’’) have issued guidance to the food processing industry to work to reduce conditions that favor the formation of this naturally occurring compound. Acrylamide formation is the result of heat processing reactions that give ‘‘browned foods’’ their desirable flavor. Acrylamide formation occurs in many food types in the human diet, including but not limited to breads, toast, cookies, coffee, crackers, potatoes, and olives. The regulatory approach to acrylamide has generally been to encourage the industry to achieve as low as reasonably achievable content levels through process control (e.g., temperature) and material testing (e.g., low sugar and low asparagine). However, limits for acrylamide exposure have been established in the State of California, andand, although currently on hold, point of sale consumer warnings aremay be required if products exceed those limits. In addition, the EFSA has promulgated regulations establishing specific mitigation measures, sampling, and analysis procedures and benchmark levels for acrylamide in certain food products. If the global regulatory approach to acrylamide becomes more stringent and additional legal limits are established, our manufacturing costs could increase. In addition, if consumer perception regarding the safety of our products is negatively impacted due to regulation, sales of our products could decrease.

Our facilities and products are subject to many lawslaws, executive orders, and regulationsregulations, including those administered by the U.S. Department of Agriculture, the FDA, the Occupational Safety and Health Administration, and other federal, state, local, and foreign governmental agencies relating to the processing, packaging, storage, distribution, advertising, labeling, quality, and safety of food products, and the health and safety of our employees. Our failure to comply with applicable lawslaws, executive orders, and regulations could subject us to additional costs, product detentions, substantial delays or a temporary shutdown in manufacturing, lawsuits, administrative penalties, and civil remedies, including fines, injunctions, and recalls or withdrawals of our products.

Our operations are also subject to extensive and increasingly stringent regulations administered by foreign governmentgovernmental agencies, the U.S. Environmental Protection Agency, and comparable state agencies, which pertain to the protection of human health and the environment, including, but not limited to, the discharge of materials into the environment, such as the land application of our processed water, and the handling and disposition of wastes. Failure to comply with these regulations can have serious consequences, including civil and administrative penalties and negative publicity, while compliance could require seasonal shutdowns in manufacturing and increase costs. Changes in applicable laws or regulations or evolving interpretations thereof may result in increased compliance costs, capital expenditures, and other financial obligations for us, which could affect our profitability or impede the production or distribution of our products, which could adversely affect our business, financial condition, and results of operations.

Climate change, or legal, regulatory, or market measures to address climate change,change or environmental sustainability, may negatively affect our business and operations.

The increasing concern over climate change and environmental sustainability also may result in more regional, federal, and/or global legal and regulatory requirements to reduce or mitigate the effects of greenhouse gases, as well as more stringent regulation of water rights.rights and usage. For example, new climate-related disclosure requirements in California such as Senate Bill 253 require companies doing business in California to report their greenhouse gas emissions. In the event that such regulation is enacted and is more aggressive than the sustainability measures that we are currently undertaking to monitor our emissions, improve our energy efficiency, and reduce, reclaim, and reuse water, we may be subject to curtailment or reduced access to resources or experience significant increases in our costs of operation and delivery. Specifically, regulatory limitations on water usage at our facilities could cause a decrease in production and/or an increase in costs. We have substantial operations in the states of Oregon and Washington, which have been steadily increasing their restrictions on water usage in manufacturing and food processing operations. If water available to our operations becomes scarce, or costs of acquiring and discharging water increase, we may incur increased production costs that we are unable or choose not to pass along to customers through increased prices, or face production constraints, which could adversely affect our business and financial results. In addition, increasing regulation of utility providers, fuel emissions, or fuel suppliers could substantially increase the distribution and supply chain costs of our products. Further,Also, wemultiple states in the U.S. have implemented, or are considering implementing, extended producer responsibility laws that require the Company to enact policies and processes and will increase expenses, including through fees paid to state governments in connection with such laws. We may experience significant increases in our compliance costs, capital expenditures, and other financial obligations to adapt our business and operations to meet new regulations and standards. For example, inIn fiscal 2026, we expect our capital expenditures to includeincluded approximately $100$90 million for environmental projects, largely focused on wastewater treatment at our production facilities. Further, we expect to spend about $500 million in the aggregate over the next six years to comply with government environmental regulations and permit limitations.

Even if we make changes to align ourselves with such legal or regulatory requirements, we may still be subject to significant penalties or potential litigation if such laws and regulations are interpreted and applied in a manner inconsistent with our practices. Also, consumers and customers may place an increased priority on purchasing products that are sustainably grown and made, requiring us to incur increased costs for additional transparency, due diligence, and reporting. In addition, we might fail to effectively address increased attention from and, at times, the conflicting views of the media, stockholders, activists, and other stakeholders on climate change and related environmental sustainability matters. From time to time, we establish and publicly announce goals and commitments, including those related to reducing our impact on the environment. Our ability to achieve any stated goal, target or objective is subject to numerous factors and conditions, many of which are outside of our control, including evolving regulatory, tracking and reporting requirements, the pace of scientific and technological developments, and the availability of suppliers that can meet our standards. We may be required to expend significant resources to meet these goals and commitments, which could significantly increase our operational costs. Our selection of voluntary disclosure frameworks and standards, and the interpretation or application of those frameworks and standards, may change from time to time or differ from those of others. Methodologies for reporting this data may be updated and previously reported data may be adjusted to reflect improvement in availability and quality of third-party data, changing assumptions, changes in the nature and scope of our operations (including from acquisitions and divestitures), and other changes in circumstances, which could result in significant revisions to our current goals, reported progress in achieving such goals, or ability to achieve such goals in the future. There can be no assurance of the extent to which any of our goals or commitments will be achieved, or that any future investments we make in furtherance of achieving these goals will meet customer or investor expectations. Any delay or failure (perceived or actual) to achieve our goals with respect to reducing our impact on the environment or perception of a delay or failure to act responsibly with respect to the environment or to effectively respond to regulatory requirements concerning climate change can lead to adverse publicity, which could damage our reputation, as well as expose us to enforcement actions and litigation. See also “Industry Risks – —Our business is affected by potato crop harvest quality and performance,” in this Item 1A. Risk Factors above.

We consider our intellectual property rights to be a significant and valuablematerial aspect of our business. We attempt to protect our intellectual property rights through a combination of trademark, patent, copyright and trade secret protection, contractual agreements and policing of third-party misuses of our intellectual property. Our failure to timely obtain or adequately protect and/or enforce our intellectual property or any change in law that lessens or removes the current legal protections of our intellectual property may diminish our competitiveness and adversely affect our business and financial results. We also license certain intellectual property, most notably Grown in Idaho and Alexia, from third parties. To the extent that we are not able to contract with these third parties on favorable terms or maintain our relationships with these third parties, our rights to use certain intellectual property could be impacted.

Our MD&A is based on financial data derived from the financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). We have also presented Adjusted EBITDA, Adjusted Gross Profit, Adjusted Selling, General and Administrative expenses (“SG&A”), Adjusted Income Tax Expense (Benefit), and Adjusted Equity Method Investment Earnings, each of which is considered a non-GAAP financial measure, to supplement the financial information included in this report. We also present net sales excluding FX and net sales excluding FX and extra week. Refer to “Non-GAAP Financial Measures” below for the definitions of Adjusted EBITDA, Adjusted Gross Profit, Adjusted SG&A, andAdjusted Income Tax Expense (Benefit), Adjusted Equity Method Investment Earnings, net sales excluding FX, and net sales excluding FX and extra week, and a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures, net income, gross profit, SG&A, and equity method investment earnings,earnings and net sales, as applicable. For more information, refer to the “Results of Operations” and “Non-GAAP Financial Measures” sections below.

Interest expense, net in fiscal 2025 increased $44.2$0.5 million, or 33%, to $180.0 million. The increase in interest expense, net was driven by a decline of $23.6 million of capitalized interest inversus fiscal 2025, compared to the$180.5 prior fiscal year, and higher borrowings during the year. The increase in our total debt reflected increased borrowing under a new term loan agreement.million. For more information, see Note 8, Debt and Financing Obligations, of the Notes to Consolidated Financial Statements in “Part II, Item 8. Financial Statements and Supplementary Data” in this Form 10-K.

Equity method investment earnings from unconsolidated joint ventures were $15.2$7.5 million and $26.0$15.2 million for fiscal 20252026 and 2024,2025, respectively. Adjusted Equity Method Investment Earnings were $7.5 million and $25.7 million for fiscal 2026 and 2025, respectively. The decline of $18.2 million in earnings was primarily the result of lower gross profit, with higher volumes more than offset by unfavorable price/mix. The results for the current and prior fiscal yearsyear reflect earnings associated with theour Company's 50 percent50% interest in Lamb Weston/RDO Frozen, an unconsolidated potato processing joint venture in Minnesota.Frozen.

During fiscal 2025,2026, cash provided by operating activities increased $70.1$74.6 million to $868.3$942.9 million, compared to $798.2 million for fiscal 2024.million. The increase primarilylargely relatedrelates to $349.1$55.1 million of favorable changes in working capital, primarilyled attributableby to reduced inventories and a favorable change inhigher accrued liabilities relatedtied to changes in compensation and benefit accruals indue theto priorbetter year.performance Inventoryachievement, dayslower oninventories, hand at the end of fiscal 2025 declined eight days compared with fiscal 2024. This was partially offset byand a $279.0$19.5 million decreaseincrease in net income, adjusted for non-cash income and expenses.items. See “Results of Operations” in this MD&A for more information related to the decreaseincrease in income from operations.

For more information about our debt, including among other items, our revolving credit agreement,facility, term loan facilities, interest rates, maturity dates, and covenants, see Note 8, Debt and Financing Obligations, of the Notes to the Consolidated Financial Statements in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K. At May 25,31, 2025,2026, we were in compliance with all covenants contained in our credit agreements.

•Short-termTotal borrowingsdebt and long-termfinancing debt, including current portion.obligations. See Note 8, Debt and Financing Obligations, for more information on debt payments and the timing of expected future payments.

•Leases. See Note 9, Leases, for more information on our operating and finance lease obligations and timing of expected future payments. The total obligation amount for leases includes imputed interest.

This report, including the MD&A, contains forward-looking statements within the meaning of the federal securities laws. Words such as “expect,” “improve,” “intend,” “continue,” “execute,advance,” “strengthen,deliver,” “drive,enable,” “optimize,” “remain,” “support,” “grow,” “reduce,” “advance,” “impact,” “focus,” “manage,” “mitigate,” “believe,” “anticipate,” “will,” “may,” “estimate,” “outlook,” and variations of such words and similar expressions are intended to identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements regarding our business and financial outlook and prospects, our plans and strategies and anticipated benefits therefrom, including with respect to the Cost Savings Program and Restructuringother Plan,cost savings or efficiency initiatives, anticipated capital expenditures,expenditures and investments, input and other costs, cash flows, liquidity, dividends, anticipated conditions in our industry and the global economy. These forward-looking statements are based on management’s current expectations and are subject to uncertainties and changes in circumstances. Readers of this report should understand that these statements are not guarantees of performance or results. Many factors could affect these forward-looking statements and our actual financial results and cause them to vary materially from the expectations contained in the forward-looking statements, including those set forth in this report. These risks and uncertainties include, among other things: consumer preferences, including restaurant traffic in North America and our international markets, and an uncertain general economic environment, including as a result of tariffs and other trade policies, inflationary pressures and recessionary concerns, any of which could adversely impact our business, financial condition or results of operations, including as a result of impacts on the demand and prices for our products; the competitive environment and related conditions in the markets in which we operate; the availability and prices of raw materials and other commodities; operational challenges; our ability to successfully implement the Cost Savings Program, the Restructuring PlanProgram or other cost savings or efficiency initiatives, including achieving the expected benefits of those activities and possible changes in the size and timing of related charges; our dependence on information technology and systems, including service interruptions, misappropriation of data, or breaches of security, as well as difficulties, disruptions or delays in implementing new technology; levels of labor and people-related expenses; our ability to successfully execute our long-term value creation strategies, including our Focus to Win planstrategy; our ability to execute on large capital projects, including construction of new production lines or facilitiesprojects; political and economic conditions in the countries in which we conduct business and other factors related to our international operations; disruptions in the global economy caused by conflicts such as the wars in Ukraine and the Middle East and the possible related heightening of our other known risks; the ultimate outcome of litigation or any product recalls or withdrawals; changes in our relationships with our growers or significant customers; impacts on our business due to health pandemics or other contagious outbreaks, such as the COVID-19 pandemic, including impacts on demand for our products, increased costs, disruption of supply, other constraints in the availability of key commodities and other necessary services or restrictions imposed by public health authorities or governments; disruption of our access to export mechanisms; risks associated with integrating acquired businesses; risks associated with other possible acquisitions; our debt levels; actions of governments and regulatory factors affecting our businesses; our ability to pay regular quarterly cash dividends or otherwise return capital to shareholders and the amounts and timing of any future dividends or other shareholder returns; and other risks described in our reports filed from time to time with the SEC. We caution readers not to place undue reliance on any forward-looking statements included in this report, which speak only as of the date of this report. We undertake no responsibility for updating these statements, except as required by law.

Lamb Weston Holdings, Inc. (“we,” “us,” “our,” the “Company,” or “Lamb Weston”) is a leading global producer, distributor, and marketer of value-added frozen potato products. We are the number one supplier of value-added frozen potato products in North America and a leading supplier of value-added frozen potato products internationally, with a strong and growing presence in high-growth emerging markets. We offer a broad product portfolio to a diverse channel and customer base in over 100 countries. French fries represent the majoritymost of our value-added frozen potato product portfolio.

This MD&A is provided as a supplement to the consolidated financial statements and related condensed notes included elsewhere herein to help provide an understanding of our financial condition, changes in financial condition and results of our operations. Our MD&A is based on financial data derived from the financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). We have also presented Adjusted EBITDA, Adjusted Gross Profit, Adjusted Selling, General and Administrative expenses (“SG&A”), and Adjusted Income Tax Expense, and Adjusted Equity Method Investment Earnings, each of which is considered a non-GAAP financial measure, to supplement the financial information included in this report. We also present net sales excluding FX. Refer to “Non-GAAP Financial Measures” below for the definitions of Adjusted EBITDA, Adjusted Gross Profit, Adjusted SG&A, and Adjusted Income Tax Expense, and Adjusted Equity Method Investment EarningsExpense and a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures, net income, gross profit, SG&A, income tax expense, or equitynet method investment earnings,sales, as applicable. For more information, refer to the “Results of Operations” and “Non-GAAP Financial Measures” sections below.

Thirteen Weeks Ended FebruaryAugust 22,30, 2026 compared to Thirteen Weeks Ended FebruaryAugust 23,24, 2025

North America segment net sales, which includes all sales to customers in the U.S., Canada, and Mexico, increased $48.7$56.8 million, or 5%, to $1,035.0$1,141.4 million. VolumeSales volume increased 12%7% compared to the prior year quarter driven by customer contract wins, share gainswins and growth.higher demand from existing customers. Price/mix declined 7%,2%, reflectingresulting continuedfrom price and trade support for customers and acontinued mix shift toward faster-growing chain customers and private-label products, which generally carry lower margins than other channels.

International segment net sales, which includes all sales to customers outside of North America, declined $4.4$45.8 million, or 1%,8%, to $529.8$528.9 million over the prior year quarter,quarter. includingSales a favorable foreign currency impact of $43.7 million. Net sales at constant currencyvolume declined 9%,6% orand $48.1 million compared to the prior year quarter. Volumeprice/mix declined 2%, driven by softer demand in key international markets, notably in EMEA. Price/mix at constant currency declined 7%, primarily reflecting ongoing price and trade to support customers and, to a lesser extent, an unfavorable mix that favors lower margin geographies and products.2%.

Gross profit declined $90.9$75.9 million versus the prior year quarter to $331.6$266.5 million. Adjusted Gross Profit declined $92.9$22.1 million versus the prior year quarter to $327.5$316.8 million, primarily reflecting unfavorable global price/mix,mix asand wellincreased asmanufacturing acosts netper $32.5pound, million pre-tax charge related to the write-off of excess raw potatoesmostly in the International segment due to lower than planned sales volumes in a competitive market environment.segment. Total manufacturing cost per pound increased,increased whichdue reflectedto the rawcarry potatoin write-off,of increasedprior fixedyear factory burden costs associated withcosts, underutilized international production facilities and inflationary pressures across key input categories globally.globally, including fuel and freight costs. These higher costs were partially offset by benefits from cost savings initiativesinitiatives, aslapping wellof asArgentina improvedstart-up operatingcosts, efficienciesand approximately $5 million in ourtariff North America segment.refunds.

SG&A declinedincreased $7.4$16.6 million versus the prior year quarter to $156.8$170.2 million. Adjusted SG&A increased $9.4$6.8 million versus the prior year quarter to $157.4$139.2 million, primarily driventhe byresult higherof compensationlapping $7.3 million of non-recurring miscellaneous income in the first quarter fiscal 2026. Cost savings mostly offset increases in outside services and benefitfixed accruals and $12.7 million write-off of capitalized costs associated with certain projects no longer under development. These costs were partially offset by the benefit of ongoing cost savings initiatives.expense.

North America Segment Adjusted EBITDA declinedincreased $12.8$27.3 million to $289.8$287.3 million compared to the prior year quarter. Higher sales volumes, lower manufacturing costs per pound, and lower Adjusted SG&A, reflecting cost savings initiativesinitiatives, and improvedapproximately operating$5 efficiencies,million werein tariff refunds, as well as an increase in equity method investment earnings, more than offset by continued price and trade support for customerscustomers, customer and anproduct unfavorablemix mix.and inflation in key input cost categories.

International Segment Adjusted EBITDA declined $75.6$30.7 million to $18.5$26.5 million compared to the prior year quarter. The decrease was primarily attributable to lower sales,sales volume and lower net sales mostly in Europe and higher manufacturing costs per pound,pound including athe netimpact $32.5 million pre-tax charge forof the write-offcarry in of excessprior rawyear potatoeshigher duecosts, tofactory lower than planned sales volumes,underutilization and increasedinflation, fixed factory burden costs associated with underutilization of international production facilities. Theincluding higher manufacturingfuel costs were partially offset by benefits from cost savings initiatives.costs.

Interest expense, net declined $2.3$1.3 million, versus the prior year quarter, to $45.0$42.4 million, driven by lower borrowingsoutstanding ondebt our revolving credit facility, partially offset by a reduced benefit from capitalized interest.balances.

Income tax expense for the thirdfirst quarter of fiscal 20262027 and 20252026 was $30.3$16.9 million and $57.5$47.9 million, respectively. The effective income tax rate (calculated as the ratio of income tax expense to pre-tax income, inclusive of equity method investment earnings) was 35.9%36.7% and 28.3%42.7% in the thirdfirst quarter of fiscal 20262027 and 2025,2026, respectively. The effective tax rate for our current quarter reflects the impacts of comparability items, most notably the expenses related to our Cost Savings Program and Restructuring Plan, as discussed in more detail in the Reconciliations of Non-GAAP Financial Measures. In addition, we recorded $10.2 million of discrete tax expense in the first quarter of fiscal 2026, primarily related to the establishment of a full valuation allowance against certain international deferred tax assets. Excluding the impact of these items, the Company’s effective tax rate was 21.8%27.2% for the thirdfirst quarter of fiscal 2026,2027, versus 28.1%30.2% for the prior year quarter. Compared to the thirdfirst quarter of fiscal 2025,2026, the effective tax rate excluding the impact of these items is lower primarily due to having a smaller proportion of losses with no expected tax benefits in certain jurisdictions.

Equity Method Investment Earnings (Loss)

Equity method investment earnings (loss) from unconsolidated joint ventures were $2.7earnings of $6.2 million and $2.1losses of $0.6 million for the thirdfirst quarter of fiscal 20262027 and 2025,2026, respectively. The increase of $0.6$6.8 million in earnings was primarily the result of higher sales volumes and gross margin, partiallyincluding offseta bymore an unfavorablefavorable mix of sales. The results for the current and prior year quarters reflect earnings associated with our 50% interest in Lamb Weston/RDO Frozen, an unconsolidated potato processing joint venture in Minnesota.

As of FebruaryAugust 22,30, 2026, we had $57.5$166.3 million of cash and cash equivalents, with $1,263.6$1,239.3 million additional amounts available for borrowing under our revolving credit facility. We believe we have sufficient liquidity to meet our business requirements for at least the next 12 months.months and the foreseeable future thereafter. Cash generated by operations, supplemented by our cash and cash equivalents and availability under our revolving credit facility, are our primary sources of liquidity for funding our business requirements. Our funding requirements include capital expenditures, changes in working capital requirements,capital, and shareholderreturning returns,cash includingto shareholders in the form of cash dividends and repurchasesshare underrepurchases. These expenditures could increase or decrease as a result of our sharefinancial repurchaseresults, program.future economic conditions, supply chain constraints for equipment, our regulatory compliance requirements, and other factors.